The Mercosur bloc met in Brazil as EU diplomats said a long-delayed trade pact could be signed on January 12, with Paraguay expected to host the ceremony and assume Mercosur's rotating presidency in 2026. The deal — negotiated for more than 25 years — would widen EU exports of vehicles, machinery and wines while easing market access for South American meat, sugar, rice, honey and soybeans. Massive farmer protests in Europe, including about 1,000 tractors in Brussels and clashes with police, forced a temporary postponement and prompted calls for stronger safeguards. EU leaders now race to reconcile political concerns and finalise the text ahead of the planned January signing.
EU Eyes January 12 Signing as Mercosur Leaders Meet in Brazil Amid Farmer Protests
Argentina, Brazil, Paraguay and Uruguay had hoped they would on Saturday finally seal a deal with the EU to create the world's largest free trade zone (Evaristo SA)(Evaristo SA/AFP/AFP)
Representatives of the South American Mercosur bloc met in southern Brazil on Friday as EU diplomatic sources indicated a long-delayed trade agreement with the European Union may be signed on January 12.
Negotiated for more than 25 years, the proposed pact between Argentina, Brazil, Paraguay, Uruguay and the EU aims to create the world's largest free-trade area. European Commission President Ursula von der Leyen said she was confident a "sufficient majority" of the EU's 27 member states could approve the deal next month, while diplomats in Brussels said the EU is aiming for a signing ceremony in Paraguay — which is due to assume the Mercosur rotating presidency from Brazil in 2026.
What the Deal Would Do
The agreement would expand EU access to Latin American markets for goods such as vehicles, machinery, wines and spirits. In return, it would ease entry of South American agricultural products — notably meat, sugar, rice, honey and soybeans — into the European market. Supporters in several EU states, including Germany, Spain and Nordic countries, argue the pact would boost exports at a time of global trade tensions.
Farmer Protests and Political Pushback
However, the accord has triggered fierce opposition from farmers in France, Italy and elsewhere who fear being undercut by cheaper agricultural imports from Brazil and its neighbours. Tens of thousands of protesters converged on Brussels this week, with organisers bringing roughly 1,000 tractors into the city. Demonstrations turned volatile at times: protesters set fires and hurled objects at police, who responded with tear gas and water cannon.
Those protests prompted the European Commission to postpone a planned signing ceremony. French President Emmanuel Macron said major changes to the text would be needed before Paris could back the deal, and Italian Prime Minister Giorgia Meloni asked for more time. Brazilian President Luiz Inácio Lula da Silva urged the EU to conclude the agreement swiftly, warning it could be lost while he remains in office if delays continue.
Political Reactions and Next Steps
German government spokesman Sebastian Hille quoted Chancellor Friedrich Merz as optimistic, saying the question was not whether the deal would be signed but when, and that the ratification process could wrap up in "the next two to three weeks." Mercosur's ministerial talks opened in Foz do Iguaçu, a border region with Argentina famed for its waterfalls. Leaders were scheduled to meet over the weekend — including Lula, Uruguay's Yamandú Orsi, Paraguay's Santiago Peña and Argentina's libertarian president Javier Milei.
One flashpoint during the week was a viral social-media image posted by Argentina's president that portrayed Brazil negatively, a reminder of how cultural and political tensions can complicate trade diplomacy.
The EU and Mercosur now face a narrow window to resolve outstanding safeguards and political objections before an anticipated January signing in Paraguay. Observers say any final text will need to balance market access with stronger protections for sensitive sectors, particularly agriculture.
