EU-Mercosur agreement: What does the text say?

The EU-Mercosur agreement, announced by the European Commission last Friday, June 28, has caused outrage among farmer representative groups across Ireland – but what exactly does the text say?

The commission has recently made the text of the agreement in principle available to the public; here we delve into the relevant nuts and bolts of what was agreed to in Europe in recent days.

It was stressed, however, that the document is not a legal text but rather summarises the negotiating results of the trade part of the EU-Mercosur Association Agreement at the time of the agreement; and is subject to final transcription into the texts and the respective market access offers.

Market access

Under the section “Market access for agricultural goods”, the text notes that duties will be gradually eliminated on 93% of tariff lines concerning EU agri-food exports. These lines correspond to 95% of the export value of EU agricultural products.

The EU will liberalise 82% of agricultural imports, with the remaining imports subject to partial liberalisation commitments including tariff-rate quotas for more sensitive products with a very small number of products excluded altogether, according to the agreement.

Under beef, the agreement states that the 99,000t quota announced on Friday will be at 7.5% in-quota rate, and subdivided into 55% fresh and 45% frozen.

Beef: 99,000t carcass weight equivalent (CWE), subdivided into 55% fresh and 45% frozen with an in-quota rate of 7.5% and elimination of at entry into force of the in-quota rate in the Mercosur-specific WTO “Hilton” quotas.

“The volume will be phased in in six equal annual stages.”

On the poultry front, the text agrees to: “180,000t CWE duty free, subdivided into 50% bone-in and 50% boneless.

“The volume will be phased in in six equal annual stages.

Finally, on pigmeat, the following is agreed: “25,000t with an in-quota duty of €83 per tonne. The volume will be phased in in six equal annual stages.”

Agreements were also made in relation to: sugar; ethanol; rice; honey; and sweetcorn.

Dairy EU export quotas

Reciprocal tariff-rate quotas will be opened by both sides phased in 10 years for EU exports to Mercosur countries.

These include quotas for: cheese; milk powders; and infant formula.

On cheese, the agreement allows: “30,000t duty free. The volume will be phased in in 10 equal annual stages stages.

“The in-quota duty will be reduced from the base rate to zero in 10 equal annual cuts starting at entry into force.

Milk powders are also agreed on: “10,000t duty-free. The volume will be phased in in 10 equal annual stages. The in-quota duty will be reduced from the base rate to zero in 10 equal annual cuts starting at entry into force.

Finally, on infant formula, the following was agreed: “5,000t duty-free.

The volume will be is phased in in 10 equal annual stages. The in-quota duty will be reduced from the base rate to zero in 10 equal annual cuts starting at entry into force.

A series of other key products of EU export interest will be liberalised by Mercosur, according to the agreement text.

These include: wine (with a minimum price on sparkling wine the first 12 years and reciprocal exclusion of wine in bulk); spirits; olive oil; fresh fruit, namely apples, pears, nectarines, plums and kiwis at entry into force; canned peaches; canned tomatoes; malt; frozen potatoes; pigmeat; chocolates; biscuits; and soft drinks.

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