Partnership Agreement between MERCOSUR and the European Union

On December 6, 2024, the leaders of MERCOSUR and the European Union announced in Montevideo the conclusion of negotiations on the MERCOSUR–European Union Partnership Agreement. The announcement allows for the preparation of the Agreement texts for their subsequent signature and ratification.

The result achieved by the two regions, after more than two decades of negotiations, is transformative from both an economic and a political perspective, in addition to strengthening MERCOSUR as a platform for the international integration of its Member States.

The Agreement will integrate two of the world’s largest economic blocs. Together, MERCOSUR and the EU encompass approximately 718 million people and a Gross Domestic Product (GDP) of around USD 22 trillion. When examined in terms of the volume of trade between the two blocs, it is at the same time the largest trade agreement ever negotiated by MERCOSUR and one of the largest concluded by the European Union with trading partners.

Considering the populations covered together with the size of the economies of the two blocs, the MERCOSUR–European Union Partnership Agreement is one of the largest bilateral free trade agreements in the world. In an international context of growing protectionism and commercial unilateralism, the Agreement signals support for international trade as a driver of economic growth.

For Brazil, the Agreement has strategic value in several respects. The European Union is Brazil’s second-largest trading partner, with bilateral trade exceeding USD 95 billion in 2024. The Agreement is expected to reinforce the diversification of Brazil’s trade partnerships—an asset of a strategic nature for the country—as well as to foster the modernization of Brazil’s industrial base through integration into European Union value chains. Likewise, the Agreement is expected to contribute to increased investment flows, which should strengthen the EU’s current position as the holder of nearly half of the stock of foreign direct investment in Brazil.

The Agreement incorporates innovative and balanced commitments consistent with the challenges of the international economic context:

• The Agreement reflects an international landscape in which the role of the State as a driver of growth and promoter of the resilience of national economies has gained prominence, especially after the COVID-19 pandemic. It opens important opportunities for increased bilateral trade and investment, while preserving space for the implementation of public policies in areas such as health, employment, the environment, innovation, and family farming.

• MERCOSUR and the European Union recognize that the challenges of sustainable development must be addressed by all, bearing in mind the common but differentiated responsibilities of countries. The Agreement includes, in a collaborative and balanced manner, various commitments aimed at reconciling trade with sustainable development. Drawing on Brazil’s strong sustainability credentials, the Agreement fosters the integration of value chains to advance toward the decarbonization of the economy, in addition to encouraging the granting of preferential treatment for foreign trade in sustainable products. The EU also commits to offering an unprecedented cooperation package to support the implementation of the Agreement.

• In order to preserve the gains in access to the European market negotiated by MERCOSUR, the Agreement innovates by establishing a mechanism for the rebalancing of concessions. As a result, the Agreement provides redress to our exporters should internal EU measures undermine the effective use of the advantages obtained under the Agreement.

• Commitments ensuring transparency and inclusiveness were included in the Agreement. Civil society entities, trade unions, non-governmental organizations, as well as the private sector and representatives of various social segments, are provided with channels to express their views and monitor the impacts of the Agreement, which may be periodically reviewed to better serve society’s interests. In addition, there are commitments to enable family farmers, local communities, and women to have effective access to the benefits that the Agreement may offer.

The Agreement represents the association between two regions that share common values and interests, such as the defense of democracy, multilateralism, and the promotion of human rights. It constitutes an unequivocal sign of the commitment of MERCOSUR and the European Union to the agendas of trade integration and sustainable development, for the benefit of the prosperity of our peoples. The Agreement establishes several mechanisms for political cooperation between the two blocs. These dialogue spaces will strengthen collaboration between MERCOSUR and the European Union in global debates that contribute to a more just and peaceful international order.

The Agreement also represents a milestone in Brazil’s bilateral relations with the European Union, which began in 1960 and, in 2007, attained the level of a strategic partnership. The establishment of the Strategic Partnership between Brazil and the European Union—the first between the bloc and a Latin American country—enhanced the political dimension of bilateral relations, traditionally dense in the economic and trade spheres.

The conclusion of the Partnership Agreement also constitutes unequivocal proof that MERCOSUR is the appropriate platform through which its Member States, by negotiating jointly, can obtain better conditions for integration into the global market.

The commitments jointly undertaken by MERCOSUR are expected to deepen economic integration among the bloc’s partners, strengthening elements such as the Common External Tariff. It is also expected that the Partnership Agreement with the European Union will accelerate a virtuous cycle of MERCOSUR’s international integration, as the preferential access obtained by the European bloc may increase the interest of third partners in negotiating arrangements with MERCOSUR.

View the texts of the Agreement below:

European Union-MERCOSUR Partnership Agreement (EMPA)

Interim Trade Agreement (ITA)