Risks from Mercosur pact exaggerated

23 July 1998

Risks from Mercosur pact ‘exaggerated’

EUROPEAN UNION (EU) chief of Latin-American relations Manuel Marin dismissed claims last night that a free trade pact between the EU and the Mercosur group could seriously harm Europes agriculture.

His spirited defence of the pact came as European Commissioners approved a negotiating mandate for a deal with Mercosur; the Latin-American trading group which includes Brazil, Argentina, Paraguay and Uruguay, with Chile as an associate member.

He accused opponents of the free-trade pact between the EU and the five Latin American countries of using scaremongering tactics.

Marin said warnings that the EU would have to pay up to $15 billion (£9bn) a year to compensate farmers for the effects of opening up EU markets to cheap Latin-American imports were exaggerated.

However, the Financial Times says the negotiating framework will face great difficulty getting the necessary unanimous approval from EU trade ministers.

Marin said the mandate excluded the most sensitive agricultural sectors, such as cereals, beef and sugar.

He said a deal would not take effect until next century so it would not encroach on the EUs Agenda 2000 programme of agricultural reform.

Franz Fischler, the EU agriculture commissioner, opposed the mandate along with three others, warning of the possible impact on traditional trade partners in other areas of the world.

See more