The European Commission unveiled a set of trade safeguards designed to protect the Community’s agricultural sector from a potential increase in imports from Mercosur, within the framework of the still-pending bi-regional agreement.
The proposal, which had been expected since September, aims to break the opposition from France and other countries with strong rural lobbies and move the treaty closer to its final approval.
Price band
The new mechanism provides that the Commission may initiate investigations if the prices of goods imported from Mercosur countries are at least 10% below equivalent European products. If this difference is determined to cause “serious harm” to local producers, the EU may suspend the negotiated preferential tariffs.
Furthermore, a volume clause is contemplated: if imports under preferential quotas grow by more than 10% year-on-year, the suspension of benefits can also be triggered. According to reports, there will be “special provisions” for the most sensitive sectors—beef, eggs, and ethanol—historically the most reluctant to open trade with Mercosur.
Activation mechanism
“In the unlikely event of an unforeseen and harmful increase in imports from Mercosur or an undue drop in prices for EU producers, quick and effective safeguards could be activated,” the Commission said in a statement.
The measures will need to be approved by the Council and the European Parliament, although without the need to reopen the chapters of the trade agreement. Brussels’ objective is to separate the economic component from the political one, allowing the treaty to be approved by a qualified majority of the Member States and a simple majority in Parliament.
In Brussels, the move is interpreted as a political attempt to save a strategic agreement that has been under negotiation for over two decades and which, despite technical consensus, remains bogged down for environmental, sovereign, and agricultural reasons.
