economy

January 17, 2026

EU and South American bloc Mercosur sign trade deal after 25 years of negotiations

The agreement paved the way for the European Union's largest-ever trade accord after 25 years of negotiations.

EU and South American bloc Mercosur sign trade deal after 25 years of negotiations

TL;DR

  • EU and Mercosur signed a free trade agreement in Paraguay after 25 years of negotiations.
  • The agreement aims to lower tariffs and boost trade between the two regions.
  • It needs to be ratified by the European Parliament and the legislatures of Mercosur members.
  • Concerns exist among European farmers and environmental groups about potential impacts on imports and deforestation.
  • The deal creates the world's largest free trade zone, encompassing 700 million people.
  • Trade between the blocs reached 111 billion euros in 2024, with EU exports focused on machinery and chemical products, and Mercosur exports on agricultural goods and minerals.

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