MercoPress. South Atlantic News Agency

EU top official says “this is the moment” for a trade agreement with Mercosur

President Lugo with EU commissioner de Gutch

European Union Trade commissioner Karel de Gutch said Monday he strongly believes the EU will reach a trade agreement with Mercosur because “this is the moment” and both sides are committed to conclude negotiations positively.

“I strongly believe in a trade agreement between the EU and Mercosur. The moment has come and I’m convinced it can be reached” said De Gutch following a meeting with Paraguayan president Fernando Lugo in Asunción.

De Gutch is on a brief visit to Mercosur junior members, Paraguay that currently holds the rotating chair and to Uruguay, with the purpose of advancing negotiations ahead of two crucial bilateral meetings to be held in Brussels next March and a second in May previous to the June Mercosur summit in Asunción.

“One of the priorities is to advance decisively in the agreement currently under negotiations with the EU after having been stalled for too long and was only retaken just over a year ago. We talked about the prospects for such an agreement”, said Paraguayan Foreign Affairs minister Hector Lacognata.

“We met with Minister Lacognata, with Industry minister (Francisco) Rivas and President Lugo. It was basically related to global issues and we are most encouraged by the excellent performance of the Paraguayan economy in 2010 (14.5% growth)”, said de Gutch.

The EU commissioner also mentioned that the EU has 130 million Euros earmarked for development until 2013 “to facilitate trade and exchanges” and Paraguay “will have a special preference since they are making great efforts. We are sure the European Parliament will agree on that special support”.

De Gutch anticipates that a balanced and ambitious free trade agreement between the EU and Mercosur could bring substantial economic benefits to both sides and contribute to the global economic recovery.

EU and Mercosur resumed trade and association talks last May --following six years of suspension starting 2004— and have since held a round of negotiations in Buenos Aires, Brasilia and Brussels.

Among the main obstacles to advance negotiations is the agriculture chapter since EU farmers, particularly breeders, fear competition from their efficient Mercosur peers that dominate several items of the world meats’ market. EU on the other hand is pressing for more industrial and services opportunities in Mercosur.