📝Mercosur Deal Likely to Make Exports More Costly: ING

Agri and food products account for the largest share of the EU’s imports from Mercosur, with a total import value of €24 billion in 2024 (43% of total imports). The agreement will facilitate trade growth by increasing import quotas and reducing or eliminating tariffs on products such as beef, poultry, and sugar.

Discontent among EU beef, poultry, and sugar beet farmers has been mounting, given that the deal will increase competition with Mercosur farmers who can operate at lower costs and to different standards. Trade between the EU and Mercosur faces significant tariff barriers, making many goods costly to export or import. The Agreement eliminates tariffs on around 91% of goods traded between the blocs. This would, for example, reduce the trade-weighted effective tariff rate on EU exports to Argentina from 10.3% in 2024 to approximately 1% over time. - ING