MercoPress. South Atlantic News Agency

Scepticism about EU-Mercosur agreement next May

The European Union does not believe a free trade agreement with Mercosur can be reached during the coming EU-Latinamerica and Caribbean summit next May in Vienna.

"After having seen the difficulties arisen during the recent World Trade Organization round, my expectations are lower since I don't think we can reach an agreement", said EU Foreign Affairs Commissar Benita Ferrero-Waldner addressing the Foreign Affairs Committee of the European Parliament.

The EU would like to "advance" in the negotiation process with the South American block (Argentina, Brazil, Paraguay and Uruguay), but "we also need an agreement that responds to European interests".

Ferrero-Waldner said she was "enthusiastic" about the negotiation process and pointed out that she promoted the ministerial meeting between the European Committee and Mercosur governments last September, as well as a coming high level encounter.

But the WTO Hong Kong conference results have been "insufficient" and "it's hard to see how we can wrap up the agreement with Mercosur before next May as was my intention". Nevertheless the EU official said that the chances of achieving results next May are "in the air", and "I'm committed to doing my utmost".

Since 1999 the EU and Mercosur are discussing the terms of a political association and free trade agreement but the disparity of interests, (Mercosur insists with access to the agriculture market and the EU with better business conditions for EU companies in the services sector) as well as linking the negotiation process to the WTO rounds, has marred the talks.

However Ms Ferrero-Waldner told the Foreign Affairs Committee she was "optimistic" about the possibility of opening free trade negotiations between the EU and Central American countries (Honduras, Nicaragua, El Salvador, Guatemala and Panama), as well as with the Andean Community (Peru, Ecuador, Colombia, Venezuela and Bolivia).-