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McGrath urges 'open mind' on Mercosur trade deal

EU Commissioner Michael McGrath said the European Commission had set out a robust bilateral safeguard mechanism for EU farmers (file image)
EU Commissioner Michael McGrath said the European Commission had set out a robust bilateral safeguard mechanism for EU farmers (file image)

Ireland's EU Commissioner Michael McGrath has urged member states to keep an open mind on the EU Mercosur trade agreement "based on the facts".

He said the European Commission had set out a robust bilateral safeguard mechanism for EU farmers in the event of any market distortions caused by opening up European markets to South American beef and poultry exporters.

The Commission this morning adopted a text to start the process of ratification by EU member states and the European Parliament.

The ratification process is expected to take at least a year, but if approved the trade agreement would create the world's biggest free trade zone, covering a market of over 700 million people.

The European Commission has said the agreement would increase EU exports to the Mercosur countries - Argentina, Brazil, Paraguay and Uruguay - by up to 39% and would be worth €49 billion to the European economy.

The trade deal would reduce Mercosur tariffs on EU exports including cars, machinery and pharmaceuticals.

Mr McGrath told reporters in Brussels: "The Commission's message to all of the member states is to have an open mind and to assess Mercosur based on the facts, and perhaps not based on assumptions or viewpoints that have developed over recent years or recent months.

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"My message to all of the member states who have concerns or questions is to engage with the Commission on the detail, because we have set out a robust bilateral safeguard mechanism, for example, that allows the EU and Mercosur to impose temporary measures to regulate imports in the event of an unexpected and significant increase in imports which causes or threatens to cause serious injury to their domestic industry."

He said the EU’s high standards on food safety, animal and plant health would still apply to any Mercosur imports and that monitoring and compliance would be stepped up.

The deal needs to be greenlit by at least 15 member states representing 65% of the EU population

Mr McGrath said: "We have also signaled today we will move forward with a number of accompanying initiatives, including steps towards potential alignment of production standards on pesticides and animal welfare applicable to imported products, so there are significant safeguards in place.

"This is the biggest free trade agreement that the European Union has ever negotiated. At the moment, some 30,000 SMEs in the European Union are exporting to Mercosur.

"We see this increasing significantly over the period ahead, they will certainly see a very significant reduction in the customs that they are currently paying."

He said there were now significant opportunities for the European food exporters.

He added: "I do understand the concerns that farmers in particular have in certain member states, and we want to work with them, and we want to provide them with the level of reassurance that we believe is backed up here in the content of the agreement and with the evidence to ensure that their livelihoods can be sustained and actually enhanced because of the opportunities that the Mercosur agreement now sets out."

Farmers across the EU have protested against the deal

However, EU farming organisations have campaigned against the terms of the agreement, in which Mercosur countries would be given an export quota of 99,000 tonnes of beef to sell into the European market at a much reduced tariff rate of 7.5%, as well as 180,000 tonnes of poultry.

EU officials said that any complaint by the beef sector about a sharp fall in prices as a result of beef or poultry imports would trigger a legally-required investigation within 21 days and if complaints are upheld provisional measures could be taken, including the restoration of tariffs on South American beef imports to 45%.

The Commission said there is also a €6.3 billion fund available to European farmers should there be further market distorting effects.

Irish farming groups have criticised the European Commission's move to have the Mercosur trade deal ratified.

President of the Irish Farmers' Association (IFA) Francie Gorman said the Commission’s approach to trade issues "has to be questioned".

He added: "It’s both hypocritical and contradictory to insist on the highest standards for European producers only to allow Mercosur countries access without reaching the same standards."

The IFA is calling on the Government to "stand up" on the issue.


Read more: Farming groups criticise EU Commission's move on Mercosur


Meanwhile the group representing dairy farmers, the ICMSA, described the Commission's proposal to ratify Mercosur as a "calculated betrayal".

EU officials have insisted that the same food safety and animal health standards that apply to EU farmers will also apply to South American producers, who will be subject to the same licensing requirements and audits.

The IFA said the deal could 'decimate' the Irish beef and poultry sector

In a statement, the Commission said: "The EU-Mercosur Partnership Agreement does not modify any EU sanitary and phytosanitary (SPS) import requirements.

"Our food health and safety standards will continue to apply to all products on the EU market - whether produced here or imported.

"In line with the ambition set out in the Vision for Agriculture and Food, the Commission is also stepping up SPS import controls by increasing the number of audits and checks in third countries, and by strengthening controls on the ground."

Chambers Ireland called for the "swift ratification" of both the Mercosur and Mexico trade agreements by the European Union.

Chief Executive of the group representing businesses Ian Talbot said Ireland needs "to develop new markets, particularly in light of ongoing volatility in some of our largest existing ones".