The Mercosur Trade Agreement: A lose-lose deal

One year after the EU announced the conclusion of an important trade agreement with the Mercosur countries (Brazil, Argentina, Uruguay, Paraguay), we want to analyse this trade agreement a bit further before it returns to the news headlines in the coming months with the start of the ratification process. The German Presidency has clearly showed its intention to conclude this agreement by putting it on the agenda of the Council’s ministerial meeting of November 9. This is nonsensical. Indeed, the Mercosur is in total contradiction with the Green Deal and would be a tragedy for the Amazon forest and its indigenous populations. 

Besides the EU-Mercosur deal being one of the biggest trade agreements the EU has ever negotiated, there is another reason why it is significant to us. This reason is more personal and is very close to our hearts. Six months ago we sailed along with climate strikers from around the world, to Latin America and arrived in the Amazon forest to attend a summit called ‘Amazonia, Centro du mundo’ (https://www.youtube.com/watch?v=9-50kuQM05M). There we talked to scientists, anthropologists, young activists from around the world and most importantly leaders of the indigenous communities in the Amazon. The stories we heard there were absolutely heartbreaking.  

The Amazon forest has undeniable importance for Latin-America, for the EU and for the world. It is home to more than 500 indigenous communities that depend on the forests for their living. The Amazon is one of the most diverse ecosystems on the planet and it influences climates all around the world. It is estimated to be the supplier of more than 20% of the world’s oxygen. The water flowing through the Amazonian rivers is equivalent to 20% of the Earth’s liquid freshwater.

It’s certain that the Amazon rainforest is crucial for Earth’s survival. And we are destroying it.  A recent study in the American magazine Science (The rotten apples of Brazil’s agribusiness, July 2020) revealed that a fifth of Brazil’s soy and beef exports to the EU comes from illegally deforested land. Deforestation is 80% due to agricultural and livestock activities and very much responsible for increasing CO2 emissions. According to official figures, the deforestation of the Brazilian Amazon reached a record with an acceleration of 25% during the first half of this year compared to the same period in 2019. The study published in Science magazine “points to the responsibility of all foreign markets in this process”. It is clear that the EU-Mercosur agreement will intensify industrial agriculture. Which means it will hugely intensify deforestation as well. Hélène Capocci, of Entraide et Fraternité underlines again “it is time to refuse to feed the economic model which provokes this type of catastrophe.”

Sharon Burrow of the ITUC (International Trade Union Confederation) also points out that the increasing commercial exploitation pressure on the Amazon rainforest will also increase socio-environmental conflicts, which already affect the indigenous people living on this territory. The EU-Mercosur deal will contribute to this pressure.

We saw firsthand in the Amazon that indigenous people’s rights are being violated in horrible ways under the Bolsonaro administration. The traditional people living inside the Amazon take care of the forest and the forest takes care of them. This means they are the caretakers of the lungs of the planet. We should be thanking these people. But instead we are completely violating their basic human rights. 

“With the blessing of Brazilian president Jair Bolsonaro, illegal loggers are mounting an all-out assault on our planet’s “green lung” according to WeMove.eu, who are running a petition to halt the Mercosur deal. “They are destroying its vital carbon stores, and the hundreds of thousands of species who call it home. All to help the meat industry. With the negotiations of Mercosur still open, the EU has powerful leverage to put pressure on Bolsonaro to save the Amazon.”

Most of the texts of the EU-Mercosur trade agreement are now public, although some important annexes and the framing preamble are not available, probably because  they are still being worked out, behind closed doors. 

According to the summary of the agreement, the goal is to meet the needs of businesses, reduce administrative barriers and expedite the clearance of goods. It would eliminate more than 91% of customs duties on trade between the two zones. 

Critics have called this ‘’cars for cows‘’, since it would promote European companies’ exports in the automotive, chemical, pharmaceutical and clothing sectors and give them greater access to public procurement Mercosur States. In exchange, Mercosur companies would benefit from broader market access in the European market for their agricultural production (beef, poultry, sugar/ethanol). The deal allows for a quota of 99,00 tons of beef, 180,000 tons for poultry meat, 650,000 tons for ethanol arriving in Europe, with a lower price than equivalents that can be produced locally in Europe.

Of course the intention is to open up business between the continents and so this is seen as beneficial for the economy of those four South American countries as well as for Europe. But the European meat producers will be facing unfair low costs imports of huge quantities of lower quality standard meat and at very high costs for our planet.  

The EU-Mercosur agreement is heavily criticised by some European farmers because of this price disparity, which will make it harder to compete with imported agricultural products, while they themselves have to produce food under higher EU standards. The dominant agro-industrial model in the Mercosur countries is based on land grabbing by a minority of large landowners, as well as the massive use of pesticides and GMOs in agriculture, and antibiotics and growth hormones for animal husbandry, a lot of which is banned in Europe. However, the EU-Mercosur agreement provides for a total elimination of customs duties for 82% of agricultural imports from these countries, and preferential rates for sensitive products (CNCD, 2020). This agreement will reinforce the deforestation underway in Brazil, factory farming and chemical agriculture, all the while treating with the greatest contempt the indigenous populations who live there.

Facing those critiques, the EU refers to protection clauses in the agreement regarding the environment, deforestation and the protection of human rights. But this is totally inadequate. An analysis by the Nicolas Hulot Foundation points that all elements of the agreement are binding with the exception of one related to the Paris agreement and deforestation, with no sanction mechanism or pausing of the agreement included in the deal should such clauses be violated. This clearly implies that profit and economic gains will once again largely outweigh climate goals, biodiversity and deforestation. 

Contrary to what the Commission may suggest, the agreement does not provide that EU standards would be applicable to imported Mercosur products to the EU. For example: there is not intention to implement the prohibition of appeal antibiotics as an animal growth enhancer, whereas according to the EU Veterinary Medicinal Products Regulation 2018, this should also apply to countries importing animal to Europe. This means farmers from Europe and from South America will be selling their goods on the same market but with different constraints. And worse, that Europe accepts a deal were there own laws will not be respected.

When you go to the official website of the EU-Mercosur agreement, the first sentence you see is: 

‘A union of countries working as one to secure the well-being of their people’’. This is outrageous when you realise that this agreement will emphasize deforestation, biodiversity loss, land grabbing, violation of human rights and adding to this, that in Europe our farmers will have to face unfair competition, that will destroy local markets. This agreement is  a gift to multinationals! 

The agreement, negotiated by the European Commission on behalf of the EU countries, will not be definitively approved until it has been ratified by the EU Council, the European Parliament, and the parliaments of all the Member States. Some countries, like France, Luxembourg, Ireland and the Wallonia region in Belgium, have already expressed their intention not to ratify it. They are saying they will not vote for the trade agreement as long as Brazil doesn’t honor its environmental commitments. The European Green Party also ratified a position against the agreement last year, and many progressive MEPs have spoken against it.  

In October 2020, it is the end of the legal scrubbing and translation process, after 20 years of negotiations. Which means it will finally be sent to the European Parliament for ratification. Following this, all EU countries will have had to decide whether to ratify the deal, highlighting the importance of grassroots campaigns in every Member State. The November 9 Council of Ministers will have to agree to launch the ratification process. 

2 scenarios are possible: 

Around Europe we find movements opposing the agreement of the Mercosur. Among them are farmers associations and trade unions. In Belgium, a coalition called “Stop EU-Mercosur” calls on Belgian governments and parliamentarians to seize this opportunity, starting by opposing this agreement which does not respect the essential guidelines in terms of sustainable development and respect for human and social rights. 

The primary concern of farmer organisations is the threat posed by Mercosur to European producers. It is also clear that farmers are unhappy with the hypocrisy of the EU calling on Member States to reduce agricultural emissions while preparing to import 99,000 tonnes of beef from South America.

We are Adélaïde Charlier and Anuna De Wever, two climate activists that launched the youth for climate movement in Belgium, internationally known as Fridays For Future. We went on strike for weeks and weeks, for more than a year. We worked together with scientists, politicians and activists. We recently sailed to Latin America to attend the CoP in Chile and to understand the threat to the Amazon Rainforest and the Global South facing the direct consequences of climate change.

After this, we felt like it was time for our activism to evolve and for us to get closer to the decision making process at the European level. We started an internship in the Greens/EFA Group in February 2020 and decided to write a regular blog to share information on the preparation of the European Green Deal within the Parliament.

We want to build the bridge between the climate activists in the streets and the politicians in the European Parliament. We would like to offer young activists more information about the internal trade-offs to pressure the right points, and debate with our politicians to show them there are millions of people all around the world ready and waiting for change.

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