Why are the French opposed to the free trade agreement?

Farmers threatening to demonstrate across France, a French Prime Minister, Michel Barnier, coming to defend their cause in Brussels: the prospect of an imminent signing of the trade agreement between the European Union (EU) and Mercosur creates political unrest in France and Europe.

What is this EU-Mercosur agreement?

This is a proposed free trade agreement between the EU and the countries of the “Southern Common Market” (Mercosur), a trade bloc that brings together Brazil, Argentina, Paraguay, Uruguay and Bolivia.

If it sees the light, the agreement would be the most important free trade agreement concluded by the EU, both in terms of population affected (780 million people) and trade volume (between 40,000 and 45,000 million euros of imports and exports). .

The text aims to facilitate trade between Europe and South America by gradually eliminating almost all customs duties applied to trade between the two blocs. The EU hopes to boost the export of European products to which Mercosur countries apply high customs duties, such as cars, clothing or wine. The agreement also provides for a significant import quota for beef, a recognition of almost 400 protected geographical indications, and various other measures aimed at facilitating mutual access of European and South American companies to public markets.

After a long negotiation process started in the early 2000s, the treaty was formally concluded on June 28, 2019. But doubts expressed by several interested countries on both sides of the Atlantic prevented its official signature.

The election of Brazilian President Lula in 2022 relaunched the issue: the European Commission and Mercosur then resumed their discussions to negotiate an annex text that would supposedly clarify the treaty and mitigate the main criticisms.

Commission President Ursula von der Leyen now wants to reach a compromise before the end of the year. Two occasions could lend themselves to the official signing of the treaty: the G20 meeting, which will be held from November 18 to 19 in Brazil, or the Mercosur summit, scheduled for December 6 to 8 in Uruguay.

Why are French farmers unhappy?

For several years, this project has raised serious concerns among farmers, who denounce the threat that the massive arrival of South American food products on the French market could pose. The agreement thus provides for the elimination of customs duties on the import of 45,000 tons of honey, 60,000 tons of rice or 180,000 tons of sugar.

But the point that crystallizes the tensions refers to the quota of 99,000 tons of beef taxed at 7.5 %, to which 60,000 are added tons of other types of beef and 180,000 tons of poultry exempt from customs duties. Breeders denounce unfair competition against large South American farms, which are more numerous, subject to less demanding health and environmental standards and where remuneration for work is lower.

A year after a large European social movement of farmers, and while professional elections in the chambers of agriculture are scheduled for January 2025, French unions are mobilizing strongly against the EU-Mercosur agreement.

The National Federation of Farmers’ Unions (FNSEA) and the Young Farmers (JA) call for actions in all departments starting November 18: demonstrations will be organized on Monday and Tuesday in front of the prefectures or at roundabouts called “rondas -points of Europe”.

The Rural Coordination, the second agricultural union in the country, some of whose executives are close to the extreme right, promises “an agricultural revolt” starting November 19, with a “Blockade of food transportation”.

The Confédération paysanne, the third union force that defends a model of peasant agriculture, also opposed to free trade agreements, will not join the mobilization launched by the FNSEA-JA alliance, but intends to mobilize ” with [ses] own modes of action ». The interprofessional associations of beef (Interbev), poultry (Anvol), cereals (Intercéales) and sugar (AIBS) also expressed their support for the mobilization.

Why is the French political class opposed to the agreement?

In France, hostility toward this agreement transcends partisan divisions. More than 600 parliamentarians from various political backgrounds recently expressed their opposition at a forum in Worldconsidering that the text does not respect “the democratic, economic, environmental and social criteria established by the National Assembly and the Senate”. Unanimity that we find in civil society, where the EU-Mercosur agreement brings together an unprecedented front of farmers, environmentalists and opponents of free trade against it.

In 2020, a commission of experts headed by environmental economist Stefan Ambec, charged by the government with evaluating the possible effects of the treaty, had already concluded that the agreement “represent[ait] “a missed opportunity for the EU to use its negotiating power to obtain solid guarantees that meet the environmental, health and, in general, social expectations of its fellow citizens”. He cited, for example, the risks of deforestation in the Mercosur countries, which could accelerate by 5% annually during the six years following ratification, due to the expected increase in beef production.

A recent audit by the European Commission, published in October, reinforced the health fears of opponents. It concludes that Brazil, the world’s largest beef exporter, cannot guarantee that the red meat it exports to the EU has not been doped with 17-β estradiol, a growth hormone banned in Europe for decades but widely used in Brazil.

Although he had initially defended the agreement, Emmanuel Macron quickly changed his mind, presenting his change of heart as a measure of retaliation for the “anti-climatic” policy of Jair Bolsonaro, then president of Brazil. Although the latter has left power, Macron remains in his position today: in February he welcomed (and wrongly) that the negotiations had stopped.

informed Ursula von der Leyen of her opposition to the agreement, denouncing, on November 13, “the disastrous impact it would have on entire sectors, particularly agriculture and livestock”.

Although they reject the project “as is,” the executive couple remains open to a revised version. For this reason, the Government asks the European Commission to renegotiate the text more thoroughly, in particular to integrate “mirror clauses”, which would impose identical standards on products marketed between the two blocs.

The French government also defends the introduction of binding measures in favor of environmental protection, to make the treaty compatible with the objectives of the Paris climate agreement. So many requests that the European Commission does not seem willing to accept today.

What are the chances of the deal going through?

The possibility of signing the EU-Mercosur agreement at the end of the year depends on the balance of power between the European Commission and the Member States. But even once signed, the treaty will need to be duly ratified by the EU before coming into force.

However, the presence in the agreement of provisions that are not strictly commercial, invading the powers of the Member States, would impose an “XXL” ratification procedure, which would require the unanimous green light of the Twenty-seven and then the approval of the European Parliament and all the national parliaments of the member countries. Therefore, France would have the possibility of veto.

To overcome this difficulty, the European Commission is tempted to divide the agreement in two, separating the cooperation aspect, which could be sacrificed, from the commercial aspect, which would then be the exclusive competence of the EU: its ratification is not required when voting for qualified majority (at least fifteen countries, representing 65% of the European population), depriving Paris of its right of veto.

In this scenario, to block the agreement, France would have to assemble a blocking minority, bringing together at least four Member States representing more than 35% of the European population. However, Paris remains isolated for the moment. Because even if Poland, Austria, the Netherlands and Ireland had regularly expressed their concerns about the agreement, their weight would not be enough to prevent the vote.

On the other hand, heavyweights such as Germany and Spain are pressuring the European Commission to finalize the agreement before the end of the year, in the hope of reviving European growth. Italy and Portugal also support this idea. Berlin sees new opportunities for its car manufacturers in Mercosur. By approaching this area of ​​the world rich in lithium, copper, iron or cobalt, Europe also seeks to ensure the supply of raw materials necessary for the success of its ecological transition.