The agreement between the European Union and Mercosur, signed in December 2024 after 25 years of negotiations, represents much more than a simple trade treaty. It creates the world’s largest free trade zone, uniting 750 million European and South American consumers in a major economic and geopolitical partnership.

For Europeans, this agreement opens considerable opportunities beyond agriculture. The gradual elimination of over 90% of tariffs will allow European companies to save more than 4 billion euros annually. The automotive industry, chemicals, engineering, and financial services sectors will benefit from privileged access to South American public markets, creating thousands of skilled jobs. The major strategic issue lies in access to critical raw materials: Brazil holds 20% of global reserves of graphite, nickel, and rare earths, essential for Europe’s energy transition, while Argentina possesses the world’s third-largest lithium reserves.

On the South American side, the agreement facilitates access to the European market of 450 million affluent consumers. Brazilian and Argentine companies will be able to participate in European public markets and benefit from European investments and technology transfers. Argentina’s trade volume could triple, with sectors like agro-industry, citrus fruits, and wines benefiting from progressive tariff reductions.

Beyond economic benefits, this agreement carries crucial geopolitical significance. Facing China’s growing influence in Latin America, it constitutes a democratic bulwark and a model of equitable cooperation between regions sharing common values. The agreement incorporates binding environmental clauses, with Mercosur countries committing to respect the Paris Agreement and end illegal deforestation by 2030.

If the ratification process proceeds smoothly, the first commercial effects could be visible by the end of 2026, marking the beginning of a lasting alliance between Europe and Latin America based on shared prosperity and mutual strategic autonomy.