By the Blouin News Business staff

Mercosur-E.U. FTA talks might actually succeed now

by in Americas, Europe.

Federica Mogherini, E.U. head of foreign affairs. (Source: Casa de América/flickr)

Federica Mogherini, E.U. head of foreign affairs. (Source: Casa de América/flickr)

Federica Mogherini, the E.U.’s head of foreign affairs, is scheduled to visit Argentine president Mauricio Macri next Wednesday. MercoPress cited diplomatic sources in Buenos Aires saying Mogherini is expected to announce that formal negotiations for the long-delayed Mercosur-E.U. FTA will begin in April.

This is a major shift from the past, when negotiations were in disarray and the prospects for reaching an agreement were very unlikely, as Blouin News reported last February. The change is mostly due to Argentina’s new president, who ushered in a new era in the country’s economic and foreign policies when he took office in December.

Macri’s administration moved quickly to dismantle his populist predecessor Cristina Fernández de Kirchner’s complicated and burdensome network of protectionism, currency manipulation, and excessive energy subsidies. Kirchner always placed national priorities (read: protectionist tariffs) over any Mercosur solidarity, and was an implacable obstacle to any progress towards an FTA being made. Now, however,  Macri is a full supporter of reaching a Mercosur-E.U. FTA as soon as possible.

Yet even with Argentina on board, some obstacles remain. Brazil has been highly protectionist, and with its economy contracting and shedding jobs, now is not an opportune time to expose its vulnerable industries to efficient foreign competition. France has also made it clear that it wants to safeguard its “sensitive” areas, including agriculture and its audiovisual industry. But the chances of reaching an agreement have never looked better.