Italy backs historic EU-Mercosur trade deal after 25 years of
negotiations
[January 10, 2026] By
SAM McNEIL and GIADA ZAMPANO
BRUSSELS (AP) — Italy on Friday gave crucial support to plans by the
European Union to seal a huge free trade deal with five South American
nations neighboring Venezuela that has been negotiated for over 25
years.
Italy's Prime Minister Giorgia Meloni was long seen as the key vote in
the campaign by European Commission President Ursula von der Leyen to
rally support for the trade deal with the Mercosur nations of Brazil,
Argentina, Bolivia, Paraguay and Uruguay.
Von der Leyen said the successful vote sends “a strong signal” of the
EU's economic clout and stability “in the face of an increasingly
hostile and transactional world." She said she would travel to Paraguay
soon, where Mercosur nations are meeting next week. The European
Parliament will vote on it before it enters into force.
“At a time when trade and dependencies are being weaponized and the
dangerous, transactional nature of the reality we live in becomes
increasingly stark, this historic trade deal is further proof that
Europe charts its own course and stands as a reliable partner,” von der
Leyen said.
Italy confirmed its support for the deal on Friday, with Foreign
Minister Antonio Tajani hailing it as "good news for Italy.”
“This agreement is destined to boost our exports, with the goal of
reaching 700 billion euros ($814 billion) in exports," Tajani wrote in a
post on X.
Meloni said she never had “any ideological objections” to the Mercosur
agreement.
"We have always said we will be in favor of it when there are sufficient
guarantees for our farmers,” she told a press conference on Friday. “The
agreement’s potential is good, but not at the expense of the excellence
of our products.”
Deal to create huge free trade zone
German Chancellor Friedrich Merz said the agreement "is a milestone in
European trade policy and an important signal of our strategic
sovereignty and ability to act.”
In a statement, he said “with this agreement, we are strengthening our
economy and trade relations with our partners in South America — which
is good for Germany and for Europe."
The deal would create one of the world's largest free trade zones,
covering some 780 million people from Uruguay to Romania and a quarter
of the globe’s gross domestic product.
It also gives Brussels a diplomatic win at a time of economic upheaval,
providing a stark counterpoint to the gunboat diplomacy of Washington
and the coercive export controls of Beijing.
“Given Trump’s policies of isolating the U.S. from the rest of the
world, it is an imperative for the EU to lead trade integration policies
at the global level and to look for partners elsewhere,” said Antonio
Fatas, a macroeconomist at the French business school INSEAD.
On the other side of the Atlantic, Brazil's President Luiz Inácio Lula
da Silva celebrated the agreement. His country's economy, worth between
$2.3 billion and $2.1 billion last year, is by far the most robust of
the South American trade bloc.
“This is a historic day for multilateralism,” Lula said in his social
media channels. “In an international scene of growing protectionism and
unilateralism, the (EU-Mercosur) deal is a favorable sign for
international trade to be a factor for economic growth, with benefits
for both blocs.
[to top of second column] |
Italian Prime Minister Giorgia Meloni arrives at her annual
start-of-the-year press conference in the press room at the Lower
Chamber, in Rome, Friday, Jan. 9, 2026. (AP Photo/Andrew Medichini)
 Countering Trump's tariff threats
In the wake of Trumps’ tariff wars, Brussels has sought to curtail
its dependency on the U.S. market with trade deals forged across the
world. The EU has struck deals with Japan and Indonesia, and are
working on one with India.
A delay in December to the signing of the deal had infuriated Lula
and led experts to worry a last-minute stumble would wreck the EU's
credibility.
“For Europeans, the finalization of free-trade agreements with new
partners stands among the best responses to US tariffs, growing
protectionism and trade tensions with China,” said Agathe Demarais,
a senior fellow at the European Council on Foreign Relations. She
said the current EU reliance on China for some critical raw
materials could be broken by tapping into Mercosur's deposits.
Opposition to the deal was led by France and Poland, with riled-up
farmers flooding streets and blocking roads with tractors from
Brussels to Athens. Austria, Hungary and Ireland also voted against
it.
Ireland's Prime Minister Micheal Martin said Thursday in Shanghai
during a state visit to China that “we don't have confidence that
(Irish farmers) wouldn't be undercut by that,” according to Irish
public broadcaster RTE.
Both Martin and French President Emmanuel Macron said that internal
negotiations sparked by the political furor surrounding the deal had
led to reforms that better protect European farmers. But they
acknowledged such reforms were not enough to overcome domestic
political pressure.
Posting on X on Thursday, Macron said three of France's key demands
were now being met: New safeguards to an “emergency brake” of
imports if they are found to undercut EU prices by 5% or more; the
mirroring of EU food safety regulations in the Mercosur bloc; and an
increase of inspections of agrifood imports at EU ports and beyond.
Still, Macron said the potential economic gains of the Mercosur deal
are limited and do not justify the risks it poses to EU agriculture.
His office stated that the deal would only add 77 billion euros
($89.7 billion) by 2040 — 0.5% of the EU's GDP.
Green members of the European Parliament had vowed to take the
Commission to court over the deal. They said the agreement would
accelerate deforestation in the Amazon and weaken the EU's climate
targets.
Frances Verkamp, trade campaigner at Friends of the Earth Europe,
described the deal as “toxic." She said Brussels is "playing a game
of imperial dominance in global trade with China and the U.S. that
wins nothing for workers or consumers — and even less for nature and
climate.”
___
Zampano reported from Rome. Associated Press writers Sylvie Corbet
in Paris and Mauricio Savarese Sao Paulo contributed.
All contents © copyright 2026 Associated Press. All rights reserved |
