MercoPress. South Atlantic News Agency

EU anticipates a trade agreement with Mercosur by next July 2011

EU Trade chief Karel De Gucht (L) met with Brazilian Foreign Secretary Celso Amorim (Pic Reuters)

EU trade chief Karel De Gucht said on Tuesday in Brazil that a EU-Mercosur trade pact could happen “in less than a year”, despite France's “firm” opposition to a deal with the South American block.

“What we hope is that we could come to an agreement within a reasonable time span, ideally before the next summer holidays,” he said, referring to the European summer break starting in July 2011.

Speaking after a meeting with Brazilian Foreign Minister Celso Amorim and Trade Minister Miguel Jorge, De Gucht said both sides would lay out their positions by the end of the year for what he described as an “ambitious and comprehensive” deal.

De Gucht acknowledged that agriculture was a “very sensitive” issue in Europe and that “certain countries” were critical of the resumed talks. But he insisted that it was the EU which was negotiating, suggesting that France's recalcitrance would be ignored.

The EU commissioner is scheduled to visit Argentina on Wednesday, and said he would drop in on other Mercosur members Uruguay and Paraguay before the end of the year.

Meanwhile France and Germany signed a joint position on Tuesday ahead of a planned reform of the EU common farm policy CAP after 2013, but they did not agree on the budget to be allocated to the CAP.

“Agriculture needs stability and visibility. A final decision on all questions relating to finances will be made when decisions are made on all policies and the entire EU financial framework,” the joint position statement said.

The agreement was signed by French Agriculture Minister Bruno Le Maire and his German counterpart Ilse Aigner in Berlin. The CAP budget now absorbs more than 40% of the EU budget of about 167.3 billion US dollars annually.

With public finances under extreme pressure as Europe tries to tackle the current economic crisis, many question whether the EU can afford to devote so much cash to farming.