European associations urge EU to expedite EU-Mercosur agreement

Written on behalf of European businesses that create millions of jobs and contribute to the welfare of European citizens, the plea comes amidst the Ukraine conflict and its subsequent strain on supply chains. These circumstances have highlighted the importance of diversifying export markets and suppliers of critical industrial inputs.

The EU-Mercosur agreement, according to the associations, is crucial for preserving Europe's competitiveness and ensuring operational supply chains in a volatile and ambiguous global setting. Crises ranging from strategic dependencies on raw material supply, concerns over feedstock, and demographic challenges have underscored the importance of strong and diversified trade relations.

The associations insist that the EU-Mercosur agreement could be pivotal in maintaining Europe's economic and geopolitical standing by providing a "first mover advantage" into the broader Latin American market. They argue that ratifying the agreement would be a significant step towards overcoming existing trade barriers with Latin America and bolstering Europe's role as a key player in the region.

While recognising concerns over environmental aspects, the letter assured that the agreement would act as a strong incentive for Mercosur countries to uphold their sustainable development commitments, including the cessation of illegal deforestation.

The EU-Mercosur agreement also presents an opportunity to address global challenges such as climate change, forest preservation, and labour rights through enhanced regulatory dialogue and cooperation. Furthermore, the associations argue that the agreement is a key component in the EU's broader strategy with Latin America and the Caribbean. The EU is already the region's largest investor and bilateral trade has increased by 40 per cent since 2018 due to existing FTAs.

With this collective call to action, the associations have urged the EU and its institutions to expedite the ratification process of the EU-Mercosur agreement.

Fibre2Fashion News Desk (KD)