MOSCOW, July 3: Member states of the Southern Common Market (MERCOSUR) and the European Free Trade Association (EFTA) are poised to sign a landmark Free Trade Agreement (FTA) later this year, according to a joint statement following talks between the two trading blocs.
“In light of the progress achieved, MERCOSUR and the EFTA states share the commitment to take the necessary steps to ensure that the Free Trade Agreement is signed in the coming months of 2025,” the statement said.
The statement was published during a MERCOSUR summit in Buenos Aires.
It said negotiations between the blocs were launched back in 2017.
“The MERCOSUR – EFTA Free Trade Agreement will create a free-trade zone of almost 300 million people and a combined GDP of more than US$ 4.3 trillion,” the statement said.
It said both sides will benefit from “improved market access for more than 97% of their exports.”
At the same time, the free trade agreement between MERCOSUR and the European Union is in limbo. In 2024, a wave of mass protests by farmers against this agreement swept across the EU countries. They fear that because of it, Europe will be inundated with cheap imports from countries with less stringent sanitary and environmental standards. European farmers, who are going through hard times, say the consequence of the deal with MERCOSUR could be a further decline in sales of European agricultural producers “due to unfair competition” with colleagues from Latin America.
The crisis worsened after European Commission President Ursula von der Leyen, despite the protest of a number of leading EU countries led by France, concluded a controversial political agreement in Montevideo(Uruguay), in December 2024 to create the world’s largest free trade zone with more than 700 million consumers from the EU and South America. The agreement concluded in Uruguay is currently undergoing the ratification procedure.
As a full-fledged association, MERCOSUR was formed in 1991, when in Asuncion, representatives of Argentina, Brazil, Paraguay and Uruguay signed an agreement to create a customs union and a common market. In 2024, Bolivia joined the bloc. MERCOSUR unites 250 million people and more than 75 per cent of the continent’s combined GDP.
The EFTA countries, which include Liechtenstein, Switzerland, Iceland and Norway, are not members of the European Union. This intergovernmental organization for the development and intensification of free trade was founded as an alternative for states that do not want to join the European community.
(UNI)
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