economy

January 28, 2026

The EU-Mercosur deal shows what the US is leaving behind

This past weekend, the European Union signed a comprehensive free trade agreement with the Mercosur bloc comprising Argentina, Brazil, Paraguay, and Uruguay. This marks the culmination of more than a quarter-century of negotiations. When fully implemented, the pact will create one of the world’s largest free trade zones, encompassing more than 700 million people.

The EU-Mercosur deal shows what the US is leaving behind

TL;DR

  • The EU and Mercosur (Argentina, Brazil, Paraguay, Uruguay) have signed a comprehensive free trade agreement.
  • This agreement, after more than 25 years of negotiations, will create one of the world's largest free trade zones.
  • The pact aims to reduce trade barriers, with Mercosur eliminating duties on 91% of EU exports and the EU phasing out tariffs on 92% of Mercosur exports.
  • This contrasts with the U.S. approach under President Trump, which favors tariffs and limited bilateral deals.
  • The EU-Mercosur deal is projected to save EU exporters over $4.6 billion annually in duties and boost exports significantly by 2040.
  • The article suggests that the U.S. is being left behind as other countries pursue openness and comprehensive trade agreements.
  • Concerns over Trump's unpredictable trade policies may have accelerated the finalization of the EU-Mercosur deal.

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