Faced with the prospect of a trade agreement with four South American countries that has taken more than twenty years to negotiate being voted down amidst wide-spread public opinion fear it might set ablaze the Amazon forest, the European Commission has taken the initiative. And it wants to move fast to get the deal over the finishing line.
The fact that Asia is moving forward with the world’s largest free trade area – RCEP – is focusing minds among the top-level strategists in EU institutions. With Mercosur “we would have the first-mover advantage” said the Commission’s Rupert Schlegelmilch, implying that the EU clearly does not have it in Asia.
Following recent meetings held by Commission vice-president Valdis Dombrovskis with Brazil’s vice president Hamilton Mourao as well as with Francisco Bustillo, foreign affairs minister of Uruguay, the country currently presiding Mercosur, the EU executive can now announce it has a concrete plan.
Technical work on ‘pre-ratification commitments’ has begun
Speaking to members of the European Parliament on Thursday (10 December 2020), Véronique Lorenzo, who heads the South America division at the European External Action Service, said that the two sides had already “started technical work”.
The aim is to agree to a ‘joint declaration’ spelling out Mercosur’s and the EU’s plans to roll out the agreement’s trade and environment commitments. Uruguay has agreed to such a mechanism “as long as it is reciprocal”, explained Lorenzo.
The aim is to “confirm and detail environmental and social commitments and that provide a response to current criticisms”. The declaration would also “showcase what we are already doing, said Lorenzo”. The main focus is deforestation and the rights of indigenous peoples.
The EU would also provide help and monies to help Mercosur countries combat deforestation. For the forthcoming programming period 2021-2027 we are proposing an Amazon initiative that would serve that purpose”.
Such a declaration would be flanked by a monitoring mechanism in the area of deforestation, with the monitoring entrusted to the EU’s research agency ‘Joint Research Centre’, explained Ms Lorenzo. The aim is to offer objective, measurable benchmarks to achieve specified goals.
The parties will also establish a dedicated institutional mechanism. “It could be a joint committee,” said Lorenzo.
The aim is to have the what would be a complementary side-deal to the Mercosur pact ready by January 2021. The institutions eye initial ratification at the middle of next year.
The chair of the international trade committee in parliament is game.
“First INTA discussion on #EU-#Mercosur agreement,” tweeted Bernd Lange during today’s committee meeting. “Econ + geopol importance of agreement acknowledged, but also concerns on implementation, monitoring and enforcement of environmental and labour issues. @EP_Trade ready to work with @DG_Trade and Mercosur on way forward.”
GI pre-ratification commitments
Note that the EU is also expecting pre-ratification commitments from the Mercosur countries on Geographical Indications – a method it frequently uses to get countries to set up relevant laws and institutions mechanisms to protect EU food and drink names before a trade agreement comes into force.