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What is the EU-Mercosur trade deal?
The EU-Mercosur trade deal is a free trade agreement negotiated over 25 years between the European Union and the Mercosur bloc, which includes Argentina, Brazil, Paraguay, and Uruguay. It aims to create a large free trade area for over 700 million people, covering a quarter of the world's GDP. The deal is designed to boost economic ties, reduce tariffs, and promote trade and investment between Europe and South America.
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Why is the EU-Mercosur deal controversial in Brussels?
The deal faces controversy in Brussels mainly due to legal challenges and environmental concerns. Critics argue that the agreement may not be fully legal under EU law and could harm the environment, especially regarding deforestation in the Amazon. Some EU countries, like France and Poland, are also concerned about the economic impact and the fairness of the deal, leading to delays in final approval.
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What does the European Parliament need to approve?
The European Parliament must give its final approval for the trade deal to become fully effective. Currently, the Parliament is reviewing the agreement, and this process could take up to two years. During this time, legal challenges and political debates could influence whether the deal is ratified or blocked altogether.
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How could this trade deal affect trade between Europe and South America?
If approved, the deal could significantly boost trade by reducing tariffs and barriers, making it easier for European and South American businesses to trade goods and services. However, if the deal is delayed or blocked, it could slow down economic growth and limit opportunities for companies in both regions, especially in sectors like agriculture, manufacturing, and technology.
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What are the main legal challenges facing the deal?
Legal challenges in the EU court question whether the deal complies with EU law, particularly regarding environmental protections and legal procedures. These challenges could delay or prevent the deal’s ratification, making it a key obstacle in the approval process.
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Could the deal be rejected altogether?
Yes, if the European Parliament or courts find significant legal or environmental issues, they could reject the deal entirely. This would mean that the long-standing negotiations would not result in a formal trade agreement, potentially affecting future EU trade policies with South America.