Brexit: Expert discusses why Macron has been 'tough' in talks
Member states including Spain, Italy, Portugal and Sweden are receiving backing from the likes of European commission trade boss Valdis Dombrovskis and foreign policy chief Josep Borrell as they attempt to pile pressure on Mr Macron over his resistance to the Mercosur trade deal, which would give EU privileged access to South America’s largest trading bloc in Argentina, Brazil Paraguay and Uruguay. Brussels rates Mercosur as its top trade and investment partner, with goods worth £37.5billion exported to the trading bloc in 2019, and services totalling £19.2nillion in 2018. Last year, EU trade negotiators struck a historical pact with the Mercosur group of four South American countries following two decades of stop-start talks.
But President Macron quickly dug his heels in, warning Paris would not ratify the historic agreement due to Brazil’s rapid destruction of the Amazon rainforest and because Brazil does not respect the Paris climate accord.
Supporters of the trade deal have questioned where Mr Macron’s true priorities lie – with the Amazon rainforest itself or of the interests of French farmers just months before the crucial regional elections in the country taking place in the spring.
However, momentum is growing to corner Mr Macron into bowing to pressure to relax his opposition to the accord, with Portugal, which will take over the EU’s rotating Council presidency from January, leading the charge.
An EU diplomat told Politico: “The Portuguese presidency will ensure that the Mercosur agreement moves forward.
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“The largest trade agreement the EU has ever negotiated will not be shelved.”
Pressure on Mr Macron ramped up last month when nine countries – the Czech Republic, Denmark, Estonia, Spain, Finland, Italy, Latvia, Portugal and Sweden – wrote to Mr Dombrovskis to warn “not signing and ratifying the EU-Mercosur Agreement will not only affect the EU’s credibility as a negotiating and geopolitical partner but will also strengthen other competitors’ position in the region.”
They fear not ratifying the huge trade agreement could force South American countries to instead turn to partners with weaker environmental rules than Brussels.
Spain is also leading the charge against the stubborn resistance from France, with Foreign Minister Arancha González Laya highlighting the importance of maintaining strong ties with Latin America, which has “hugely similar views” that is “interested in joining the EU in fighting global climate change, working to ensure a more solid financial system” and boosting “multilateralism.”
She told Politico: “This is why the European Union should do good in paying more attention to Latin America, starting with delivering on the trade agreements that Europe has negotiated in good faith with … Mercosur or the one that it is currently negotiating with Mexico or with Chile.
“Latin America is a test case of the so-called strategic autonomy of the European Union, its ability to build alliances.”
Brussels is also opening the path for ratification of the trade deal, after Mr Dombrovskis agreed with Mercosur to negotiate additional commitments on the environment, while not complicating matters by reopening the actual accord itself.
Earlier this month, the European Commission trade boss met Uruguayan Foreign Minister Francisco Bustillo in the Belgian capital, with both pledging to “immediately commence joint work” to negotiate additional environmental commitments.
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Uruguay, which itself currently heads the presidency of the huge South American trading bloc, has confirmed Mercosur is “willing to cooperate in the design of an additional declaration that would deepen environmental commitments as long as the additional commitments and actions applied to both parties.”
A statement from Montevideo said the ministers had agreed Mr Dombrovskis would “present a first draft of the declaration on additional rainforest and climate commitments early 2021 as a working basis for both sides.”
Mr Macron’s opposition to the huge trade deal had been backed up by French officials, who insist the agreements economic advantages don’t weight up against the potential political cost.
One French minister was recently asked by Politico whether additional commitments on deforestation and climate could save the deal, but they simply replied: “I don’t think there is any chance this agreement goes through.”
But Jordi Cañas, a Spaniard from the liberal Renew Europe group and the European Parliament’s lead official on the Mercosur deal, hit back at the French opposition.
He said: “Macron has found a cheap way to please both environmentalists and farmers by opposing Mercosur.
“It doesn’t cost much, because he doesn’t have to do anything, and he can make great principled statements. But it’s still protectionism, camouflaged by virtuous semantics.”
A defiant Mr Cañas added: “After the French regional elections [in March or June 2021], I see a window of opportunity during the Portuguese presidency to start the ratification,” said Cañas.
“I think even sceptical countries such as France are recognizing that globalization will continue with or without us. China has just signed RCEP, and that is putting pressure on Europe to forge our own trade alliances.”
But in a sign France is beginning to bow to pressure, junior minister for trade Franck Riester told a POLITICO event: “We have to be sure that the Paris agreement on climate change will be respected by the Mercosur countries.
“After that, why should we not continue with the Mercosur agreement? We don’t want to put 10 years of negotiations in the garbage.”
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