Last week, after 20 years, the EU and Mercosur countries concluded a political agreement for an ambitious, balanced and comprehensive trade agreement.
It is the biggest trade agreement that the EU has ever concluded (covering 773 million people and providing tariff savings for EU companies of more than €4 billion) and the first trade pact ever struck by Mercosur which comprises Argentina, Brazil, Paraguay and Uruguay. Venezuela is also member, but is suspended.
Much of the initial reaction has focused on the market access aspects of the deal, including the reduction or elimination of tariffs, which will help trade flows in both directions, or the creation of tariff rate quotas, which will allow additional, limited volumes of product to be exported at preferential tariff rates.
However, there has also been considerable concern expressed, particularly in Europe, about the potential environmental and climate impact of the deal in the Mercosur countries and questions raised about the EU’s commitment to sustainable development.
As we saw in recent elections to the European Parliament, right across Europe, there is an increasing concern and consciousness about environmental and climate-related issues. This concern has certainly contributed to some of the criticism that we have seen in relation to the EU-Mercosur trade deal.
The Irish Government will have to take a decision to support or oppose this agreement
Unfortunately, some of the commentary is inaccurate and has, in some cases, been used disingenuously to argue against other aspects of the agreement.
However, that is not to say that there is much well-founded concern and many of the genuine questions raised deserve answers from policymakers. At some point in the future, the Irish Government will have to take a decision to support or oppose this agreement, but there is time before that decision is taken and that time should be used to have a rational debate on the facts of the agreement and not on the basis of the false claims that are being made.
Throughout these long negotiations, climate and environmental issues have been climbing steadily up the political agenda and as the negotiations stretched over two decades, so too has the sustainability agenda become a central part of those negotiations.
Reflecting that changing agenda and to ensure visibility for the trade and sustainable development aspects, the agreement contains a dedicated trade and sustainable development chapter, the central premise of which is “that trade should not happen at the expense of the environment or labour conditions: on the contrary, it should promote sustainable development”.
It contains strong commitments for the effective implementation of the Paris Agreement on climate and the Mercosur countries have included specific pledges as part of their respective commitments.
For example, Brazil’s nationally determined contribution under the Paris Agreement includes pledges to achieve:
- Zero illegal deforestation in the Brazilian Amazon;
- The restoration and reforestation of 12 million hectares of forests;
- And the enhancement of sustainable management of natural forests with a view to curbing illegal and unsustainable practices.
However, I am also conscious that many people are concerned about the potential environmental effect of increased production of beef in Mercosur, not least in Brazil. Unfortunately, some of the recent commentary has been way off the mark. The fact is that Brazil alone produces some 11 million tonnes of beef annually. The quota, which is to be shared between the four Mercosur countries represents, therefore, less than 1 per cent of Brazilian annual production.
In addition, Brazil has included commitments on deforestation in their Paris Agreement pledges, which are reinforced by private sector initiatives such as that of the Brazilian meat packers not to source meat from farms in recently deforested areas.
The civil society consultation mechanisms built into the agreement will complement these provisions
Through the trade and sustainable development chapter, both the EU and Mercosur have expressed commitment to pursuing their trade relationship in a way that contributes to sustainable development and builds on their multilateral commitments in the fields of labour and environment. The civil society consultation mechanisms built into the agreement will complement these provisions – providing an opportunity for civil society on both sides to engage with government and with each other and to influence the implementation of the chapter and of the agreement.
This deal is comprehensive and complex. It requires careful consideration and evaluation and it will be some time before an Irish government has to take a position. I hope that this time will be taken to undertake a detailed economic and environment evaluation and that the Government’s position, when it comes to be taken, will be a fully informed decision based on all the facts.
- Phil Hogan is EU commissioner for agriculture and rural development