An instrument out of tune: the EU –Mercosur Trade Agreement

Nataly Machado (Master’s student in EU Law, UMinho)

Brazil is one of the countries with the largest environmental heritage in the world. However, in breach of the existing legislation that helps protect the environment, Brazilian biomes are increasingly threatened by the poor political and environmental management of this country in recent years.

If we consider the Amazon biome, the largest tropical forest in the world, which occupies 59% of Brazil’s territory, holds a large part of the available freshwater in the world and is home to the largest number of species of flora and fauna in the world, the numbers of environmental setbacks are alarming (to say the least). For example, in April 2021, record shows that deforestation reached 778 km2, which is the highest rate for that month in the last ten years[1].

The gap between the discourse of goals and commitments to take care of the Brazilian forests and what happens in practice – an old and repeated script in the history of unbridled destruction of the Amazon – has not worked as a strategy to consolidate the trade agreement between the European Union and Mercosur (Argentina, Brazil, Paraguay and Uruguay), which has been the breeding ground for controversy before the final approval of the EU Member States and the European Parliament.

In short, the aforementioned trade agreement, announced on 28 June 2019, would ensure a region-to-region commercial venue with fewer restrictions and tariffs amongst the participants. A milestone in the history of diplomacy and international trade, it is a broad partnership that presents great opportunities for both blocs and will enable the strategic integration of two markets that together represent 780 million consumers. Through the agreement, the two blocs propose to remove trade restrictions between themselves in relation to almost all productive sectors, both in Europe as a whole and in the Latin American sub-region. Mercosur will fully liberalise 91% of its imports from the EU over a transition period of up to 10 years for most products, and the EU will eliminate duties on 100% of industrial goods over a transitional period of up to 10 years[2].

The agreement goes beyond trade agendas and also addresses issues regarding services, government procurements, technical barriers, phytosanitary measures, intellectual property, and establishes a roadmap to high standard normative commitments, with a solid framework on issues such as the environment and that reinforces the sustainable development commitments already partaken by the countries that make up both blocs under the Paris Agreement.

One of the focal points of the agreement between the economic blocs is the commitment to effectively implement the Paris Agreement, safeguarding a sustainable management and conservation of forests through high standards and human rights concerns from a social and environmental perspective. Therefore, the agreement pays special attention to ensuring that trade in natural resources such as forestry products, fisheries and wildlife is based on sustainable principles. It aims to prevent trade in illegally obtained products and to promote trade in products that contribute to the conservation of biodiversity[3].

Furthermore, the ‘precautionary principle’ is established as a cornerstone of the agreement when there is a perception of risk from exports and aims to ensure that the EU and the Mercosur countries can continue to protect health and the environment even if this affects trade, including in situations where scientific information is not conclusive.

In line with this environmental concern of the trade agreement in question, the European Green Deal lays down strict rules for all stages of the food chain, which are essential for combating climate change, protecting the environment and preserving biodiversity, since deforestation and the intensive mono-culture that derives from this practice are one of the main causes of loss of biodiversity in nature[4].

This is the setting in which the EU, through the European Green Deal, develops stronger green deal diplomacy, focused on convincing and supporting others to take their fair share in promoting more sustainable development, ensuring that the Paris Agreement remains the indispensable multilateral framework for tackling climate change.

In addition, European public opinion has increasingly gained momentum on environmental issues. According to an EU-wide survey published in September 2017, the Special Eurobarometer on climate change, more than 9 in 10 EU citizens (92%) consider climate change to be a serious problem[5].

The latest report by MapBiomas shows that deforestation rose 14% in 2020. 99.8% of deforestation is illegal and only 2% has been addressed by Ibama – Brazilian Institute of the Environment and Renewable Natural Resources. As a result, demonstrations of boycott of Brazilian products by European food producers and sellers and official messages such as the letter from the Austrian government and the German Agriculture Minister’s stating that she, Julia Klöckner, is skeptical of the deal of the trade agreement between the EU and Mercosur, are clear signs of resistance against consolidation of the agreement[6]. Furthermore, those reservations about ratifying the agreement are based on Europe’s own commitments set out in the Green Deal and the Paris Agreement, pointing to the deforestation of the Amazon.

The problem revolves around the real need to implement a State model that values the guarantee of environmental quality and the antagonistic practices of dismantling environmental protection programs and institutions, as well as legislative attempts that further catalyze deforestation in the Amazon and open more space for the vulnerability of public forests. Recent example of these practices can be easily seen in a bill awaiting consideration by the Brazilian Senate, regarding environmental licensing (PL 3729/04), which basically seeks to make environmental licensing more flexible, releasing it for a series of economic activities, as if it were a type of licensing conceded through self-declaration by the interested party.

What we have is a deconstruction of Brazilian environmental norms and policies, which goes against the principle of environmental precaution, established in the Brazilian Federal Constitution, in article 225, § 1º, that sets goals for the Administration to define minimum parameters in the pursuit of environmental defense and preservation through public policies and control mechanisms.

And scientific research[7] suggests that there is a real impossibility of following through any plan to combat climate change and, at the same time, adapt to a trade agreement of huge proportions such as the EU-Mercosur, which demands a rigid standard of protection and environmental sustainability according to the guidelines of the Paris Agreement, of which Brazil is a signatory country. The destruction of Brazilian biomes goes against the EU’s strategic plan to face the climate and environmental challenges as a new growth strategy as established by the European Green Deal.

The fact remains that it will become easier for Mercosur to export to the EU, as far as they respect the EU’s high standards[8] and adapt not only the South American bloc’s normative framework regarding environmental protection, but also practical actions that are convergent with the Paris Agreement and the European Green Deal. As the latter document emphasizes “the Commission will propose to make the respect of the Paris agreement an essential element for all future comprehensive trade agreements; the EU’s trade policy facilitates trade and investment in green goods and services and promotes climate friendly public procurement, and trade policy also needs to ensure undistorted, fair trade and investment in raw materials that the EU economy needs for the green transition”[9].

Unfortunately, it is confronted with this backdrop of unbridled environmental destruction, mainly by Brazilian (in)actions, that the EU-Mercosur trade agreement will be deliberated by each of the Member States’ the parliaments and then by the European Parliament.

What is expected is that the climate emergency will be the central theme to guide the resolution of the controversies that are present amidst the negotiation process of this agreement –  which is already jeopardized – in order to suppress the euphoria of promoting the expansion of production chains that follow a logic of unbridled economic growth and are manifestly contrary to the imperatives of the newest maestro to conduct the European orchestra of ecological transition to a clean, circular economy and to restore biodiversity and cut pollution: the European Green Deal.


[1]Information available at https://imazon.org.br/imprensa/desmatamento-atinge-778-km%C2%B2-na-amazonia-em-abril-maior-valor-para-o-mes-em-10-anos-aponta-imazon/

[2]Information available at https://trade.ec.europa.eu/doclib/docs/2019/june/tradoc_157964.pdf

[3]For further development, see https://trade.ec.europa.eu/doclib/docs/2019/june/tradoc_157957.pdf

[4]Information available at https://www.europarl.europa.eu/news/en/headlines/society/20200109STO69929/biodiversity-loss-what-is-causing-it-and-why-is-it-a-concern

[5]Information available at https://op.europa.eu/en/publication-detail/-/publication/92f6d5bc-76bc-11e9-9f05-01aa75ed71a1

[6]Information available at https://www.euractiv.com/section/economy-jobs/news/austria-vetoes-mercosur-deal-saying-it-goes-against-eu-green-deal/ and https://www.irishexaminer.com/farming/arid-40044770.html

[7]For further development, see https://www.nature.com/articles/s41559-020-01368-x https://www.bbc.com/news/world-latin-america-55130304 and https://www.globalforestwatch.org/map/

[8]For further development, see https://trade.ec.europa.eu/doclib/docs/2019/june/tradoc_157953.pdf

[9]Information available at https://eur-lex.europa.eu/legal-content/EN/TXT/?qid=1588580774040&uri=CELEX:52019DC0640

Picture credits: TNeto

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