EU Cinches “Historic” Trade Pact with South America

The European Union and Mercosur, South America’s trade powerful economic bloc, have completed a broad bilateral trade agreement to lower or remove tariffs in both directions.

European Union President Jean-Claude Juncker describes the pact as the EU’s biggest ever. BBC News says the deal promises to open major markets in South America that have been some of the world’s most shielded economies.

Mercosur consists of Argentina, Brazil, Paraguay and Uruguay. Venezuela’s membership was suspended three years ago when it became unable to meet the group’s basic membership standards.

A primary goal for the EU is to lower South American tariffs on imported cars, which can run as great as 35%, and other industrial goods. Mercosur aims to boost its export of beef, poultry and sugar to Europe.

In a swipe at the Trump administration’s mercurial trade policies, EU Trade Commissioner says the new agreement underscores the preference of both parties for “open, sustainable and rules-based trade.” She adds that talks between the EU and Mercosur accelerated after Trump’s presidency began.

BBC News points out that the EU also has cinched trade pacts with Canada, Mexico and Japan since President Donald Trump’s election in 2016.