MercoPress. South Atlantic News Agency

EU Parliament calls for free trade agreement with Mercosur

An overwhelming majority in the European Parliament approved Thursday a report calling on the EU to reach “as soon as possible” a free trade agreement with Mercosur, currently blocked by the World Trade Organization Doha round talks.

In full session the report from Euro MP Daniel Varela was supported by 489 votes with 75 against and seven abstentions, highlighting that the trade agreement with Mercosur is a "priority strategic objective" for the EU.

The vote comes when both blocks were preparing to resume talks which were originally scheduled for next week but has now been delayed until November.

According to the report from the Conservative MP from Spain, the "no agreement" with Mercosur is costing the EU 3.7 billion Euros annually in non traded goods, and an estimated five billion US dollars if the gradual liberalization of goods and services markets was effective.

"Having access to a market of 230 million people following on the steps of other free trade agreements such as those successfully signed by the EU with Mexico or Chile, is crucial for the European corporations and reciprocally for those of the other countries", explains Varela's report.

When and if the EU and Mercosur finally reach a free trade agreement it would become the world's largest market with 700 million people. But talks which begun in 1999 and should have concluded in 2004, remain stalled.

Both sides re-launched discussions in September 2005, but any bilateral agreement seems to be conditioned to the results of the also stalled WTO Doha round talks.

However both the EU and Mercosur are looking for options and a "window of opportunity", parallel to the current Doha round, seems feasible and a meeting next week in Rio do Janeiro is currently under consideration, revealed the EU spokesperson Peter Powers.