EU delays free-trade deal Mercosur with LatAm after farmer agitation, political protests in France, Italy

The European Union is delaying a massive free-trade deal with South American countries after fiery protests by farmers and last-minute opposition by France and Italy threatened to derail the pact, seen by its backers as an important geopolitical move for both continents.

Top EU officials had hoped to sign the EU-Mercosur deal in Brazil this weekend, after 26 years of negotiations. Instead, European Commission chief spokesperson Paula Pinho confirmed that the signature had been put off until January.

Experts say the delay could dent the EU’s negotiating credibility globally as it seeks to forge new trade ties amid commercial tensions with the U.S. and China. Once ratified, the trade deal would cover a market of 780 million people and a quarter of the globe’s gross domestic product, and progressively remove duties on almost all goods traded between the two blocs.

French farmers unions, who fear the deal would undercut their livelihoods, welcomed the postponement. France had led opposition to the deal between the EU and the five active Mercosur countries — Brazil, Argentina, Uruguay, Paraguay and Bolivia. Italy raised new reservations Wednesday.

Thursday’s agreement for a delay was reached between European Commission President Ursula von der Leyen and European Council President Antonio Costa on the sidelines of an EU summit with Italian Premier Giorgia Meloni, on the condition that Italy would vote in favor of the agreement in January, an EU official said.

The decision came hours after farmers in tractors blocked roads and set off fireworks in Brussels to protest the trade deal, prompting police to respond with tear gas and water cannons.

The farmers brought potatoes and eggs to throw and waged a furious back-and-forth with police. Protesters burned tires and a faux wooden coffin bearing the word “Agriculture.” Their fire unleashed a black cloud that swirled with white tear gas. The European Parliament evacuated some staff due to damage caused by protesters.

“We are fighting to defend our jobs,” said Armand Chevron, a 23-year old French farmer.

Hundreds of farmers like Pierre Vromann, 60, had arrived on tractors, which they parked to block roads around the key institutions of the EU.

The Mercosur deal would be “bad for farmers, bad for consumers, bad for citizens and bad for Europe,” said Vromann, who raises cattle and grains in the nearby Belgian city of Waterloo.

Other farmers came from as far away as Spain and Poland.

French President Emmanuel Macron dug in against the Mercosur deal as he arrived for Thursday’s EU summit, pushing for further concessions and more discussions in January. He said he has been in discussions with Italian, Polish, Belgian, Austrian and Irish colleagues among others about delaying it.

“Farmers already face an enormous amount of challenges,″ he said, as farmer protests over the trade deal and a cattle disease roil regions around France. “We cannot sacrifice them to this accord.”

Worried by a surging far right that rallies support by criticizing the deal, Macron’s centrist government has demanded safeguards to monitor and stop large economic disruption in the EU, increased regulations in the Mercosur nations like pesticide restrictions, and more inspections of imports at EU ports.

Italy’s Meloni told the Italian Parliament on Wednesday that signing the agreement in the coming days “would be premature.”

“This doesn’t mean that Italy intends to block or oppose (the deal), but that it intends to approve the agreement only when it includes adequate reciprocal guarantees for our agricultural sector,” Meloni said.

Von der Leyen is determined to sign the agreement, but she needs the backing of at least two-thirds of EU nations. Italy’s opposition would give France enough votes to veto von der Leyen’s signature.

In Greece, farmers have set up roadblocks along highways across the country for weeks, protesting delays in agricultural subsidy payments as well as high production costs and low product prices that they say are strangling their sector and making it impossible to make ends meet.

Supporters say the EU-Mercosur deal would offer a clear alternative to Beijing’s export-controls and Washington’s tariff blitzkrieg, while detractors say it will undermine both environmental regulations and the EU’s iconic agricultural sector.

German Chancellor Friedrich Merz said ahead of the Brussels summit that the EU’s global status would be dented by a delay or scrapping of the deal.

“If the European Union wants to remain credible in global trade policy, then decisions must be made now,” Merz said.

The deal is also about strategic competition between Western nations and China over Latin America, said Agathe Demarais, a senior fellow at the European Council on Foreign Relations. “A failure to sign the EU-Mercosur free trade agreement risks pushing Latin American economies closer to Beijing’s orbit,” she said.

The political tensions that have marked Mercosur in recent years — especially between Argentina’s far-right President Javier Milei and Brazil’s center-left Luiz Inácio Lula da Silva, the bloc’s two main partners — have not deterred South American leaders from pursuing an alliance with Europe that will benefit their agricultural sectors.

Lula has been one of the most fervent promoters of the agreement. He was betting on closing the deal Saturday and scoring a major diplomatic achievement ahead of next year’s general elections. He said he was surprised by Italy’s hesitancy, and had spoken about it directly with Meloni.

At a Cabinet meeting Wednesday, Lula was clearly irked by Italy and France’s positions.

“If we don’t do it now, Brazil won’t make any more agreements while I’m president,” Lula said, adding that the agreement would “defend multilateralism” as Trump pursues unilateralism.

Milei, a close ideological ally of Trump, also supports the deal.

“We must stop thinking of Mercosur as a shield that protects us from the world and start thinking of it as a spear that allows us to effectively penetrate global markets,” he said some time ago.

(Except for the headline, this story has not been edited by Firstpost staff.)