“The coronavirus crisis shows that solidarity, open trade and rules-based multilateral cooperation are the only way to recover. It is essential to focus on a positive agenda in order to strengthen the future political dialogue, cooperation and economic exchanges between Mercosur and the EU,” the statement continues. The potential effects of the agreement on the environment are also of concern, in particular that it could be a setback in the fight against climate change. [14] The Amazon rainforest is one of the largest carbon sinks in the world. [16] But the amount of carbon the Amazon absorbs and stores each year in the atmosphere has decreased by about a third over the past decade. [17] This decrease in the carbon sink in the Amazon amounts to one billion tons of carbon dioxide, more than double Britain`s annual emissions. [17] Since the election of Jair Bolsonaro as President of Brazil, deforestation in the Amazon has intensified. [14] Deforestation in the Amazon has not been as rapid in a decade, with deforestation increasing by 13% in 2018. [14] The Mercosur bloc said in the statement that it was examining next steps to ensure that Argentina`s decision would not disrupt ongoing trade negotiations. The EU is already Mercosur`s largest trade and investment partner. [1] 20.1% of the trade bloc`s exports went to the EU in 2018. [8] Mercosur exports to the EU amounted to €42.6 billion this year[8], while EU exports to Mercosur countries amounted to €45 billion.

[8] Mercosur`s most important exports to EU countries are agricultural products such as food, beverages and tobacco, plant products such as soya and coffee, as well as meat and other animal products. [8] Among Europe`s largest exports to Mercosur are machinery, transport, and chemicals and pharmaceuticals. [8] In 2017, the EU exported €23 billion of services to the South American trading bloc, while some €11 billion of services were exported from Mercosur to Europe. [8] The agreement was reached after twenty years of negotiations. Talks began in 1999[2], but stagnated before regaining momentum in 2016. [4] The talks had failed for years due to opposition from European beef producers, especially small farmers, who feared being underestimated by imports from Brazil, the world`s largest beef producer. [5] Many South American governments at that time preferred “South-South cooperation” to building relations with Europe, while European governments also had other priorities. [6] Since 2001, Argentina has recorded trade surpluses mainly due to exports of agricultural products. .

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