EU and Mercosur – Effects of Reducing Trade Barriers and Sustainability Aspects

The Association Agreement between the EU and Mercosur countries (Argentina, Brazil, Paraguay, Uruguay), presented in 2019, aims to improve trade relations and to use the dynamics of induced economic growth to achieve objectives of common interest that go beyond the intensification of external trade. Trade in goods and services in recent years show a slight export surplus of Austria with Mercosur while the EU as a whole imports more than it exports. A reduction of trade barriers will lead to slight increases in economic growth in both regions. The agreement includes a wide range of environmental issues and sustainable development aspects. However, public criticism of the agreement is concerned about the expected low level of enforcement.