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Montevideo, May 23rd 2024 - 09:35 UTC



“EU approach on trade accord with Mercosur is simply unacceptable,” Paraguayan President elect Peña

Friday, August 11th 2023 - 11:48 UTC
Full article 14 comments
Peña's comments on trade talks are the strongest since winning election in April, underscore rising tensions between the European block and Mercosur Peña's comments on trade talks are the strongest since winning election in April, underscore rising tensions between the European block and Mercosur

Paraguay President-elect Santiago Peña has said that Mercosur and the European Union should put on hold talks over a free trade agreement since the current environmental demands from the EU are “unacceptable.”

Peña takes office next week and said EU's proposals would hinder major soy exporter Paraguay’s economic development. Paraguay is the weakest economy of the four Mercosur member states next to Brazil, Argentina and Uruguay.

Peña's comments on trade talks, the strongest since winning election in April, underscore rising tensions as the European block and Mercosur race to finalize a deal, long delayed due to doubts over Brazil’s climate action commitments.

The European Commission, EU’s executive, said it was “fully committed to push the EU-Mercosur Agreement towards the finish line before the end of the year”. It has been on the negotiating table for over twenty years.

Mercosur countries, home to huge swathes of the Amazon, the Chaco forest and key wetlands, are major exporters of soy, corn and beef. They have increasingly pushed back against environmental demands from the EU, saying they amount to European protectionism and would hurt local production.

“This approach from the EU is simply unacceptable,” said Peña, 44, who represents the ruling conservative Colorado party. “What the European Union has to do is come clean about whether or not it wants to move forward with a free trade agreement. Today I question whether they have that genuine interest.”

Mercosur officials are working on a counter-proposal before meeting with EU negotiators. There are some hopes of reaching an agreement later this year on the trade deal.

“From our point of view, negotiations should be closed and the decision simply made: Do we want this to happen or do we not want this to happen?” Peña asked.

The European Commission said its proposals were meant to address sustainability concerns, including on deforestation. It said it was waiting to see alternative ideas from Mercosur.

Pena anticipated he was not planning any new taxes on the agricultural sector, the economic engine in the world’s No. 3 soybean exporter. He said some taxes on international trade could even be eliminated to boost competitiveness and exports.

“Paraguay has to consolidate the model it has today of low taxes to attract investment and create jobs,” he said. “Probably in the future with a more formalized economy… we could think of some adjustments in some rates.”

The President-elect also said current agriculture minister Santiago Bertoni, who has the support of the country’s soybean chamber, had done a “good job” and could remain in office.

Top Comments

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  • Argentine_Cityzen

    We dont need any deal with the UE.. they need energy, Gas & Oil.., metals and rare earths.. they on war with russia and had carency of this commodities.. all the things that UE can offer.. are produced by china, and we can purchase to them.

    Aug 12th, 2023 - 06:43 am 0
  • Esteban Domingo Fernandez

    Senor Cityzen, the EU needs nothing from Mercosur, but Mercosur needs investment from the EU,

    Aug 12th, 2023 - 08:46 am 0
  • Argentine_Cityzen

    The Mercosur countries all have a low carbon footprint, positive co2 balance and low per capita energy consumption. We do not need false environmentalism from countries that are irresponsible in the use of energy, that were founded on the basis of carbon, that consume 10,000kwh/inhab and that use private jet planes to get around.
    We do not need investments conditioned under a pseudo environmentalism that is actually an excuse for us to agree free taxes their products but they want use the excuse of ambientalism to taxe our agro products.

    At really they need us more than we need them.. we already had the strong chinesse investment, we are inside the silk road and brics already demand our gas, oil, agro products etc..
    China and india will be 1st world power before 2050 and they already can produce the samd gods that EU and more cheap.. its preferible no deal on that conditions and pay more taxes for they mercedes benz, bmw, iberic jam etc no problem they only can offer not ecential produts for us.

    We had the food, gas, oil, metals, fish, etc and rusia already locked them the doors..

    Let's see who can hold more, if we for import more expensive their watches, cars and sumptuous goods or they with their empty stomachs and uncompetitive industries for more expensive energy and commodities.

    free trade agreement without environmental conditions or no agreement.

    Aug 12th, 2023 - 09:29 am 0
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