An EU-Mercosur Free Trade Agreement would be the EU’s largest trade deal to date, four times the size of the trade agreement with Japan. It aims to eliminate trade tariffs between the EU and the Mercosur region. Irish exporters are currently subject to trade tariffs, barriers and restrictions, when exporting to Mercosur. The proposed FTA should make exports from Ireland more attractive and potentially increase demand for Irish products.
Sectoral opportunities for Ireland in further enhancing a trading relationship with this region include software and services in telecommunications, financial services, digital content and travel, engineering products and services, life sciences, agriculture, food and beverages, and education services.
Within the region, Brazil is Ireland’s main trading partner and has been identified as possessing “high growth market potential” by Enterprise Ireland.
On the other hand, Ireland has strong concerns in relation to agriculture, especially the potential impact that these negotiations present to the EU beef sector. While all FTA’s include agricultural market access and TRQs (Tariff Rate Quotas), TRQs provided under such agreements are not always fully utilised by our trading partners. Equally, most Member States tend to have sensitives in relation to certain goods or services to be comprehended under an FTA.
I am keenly aware of the issues faced by the Agriculture sector and the challenges posed by a trade agreement with Mercosur. In the context of these negotiations, Ireland has many “offensive” and “defensive” interests, including in the agri-food sector and engages on these issues with the Commission, in its role as lead negotiator.
In this regard, Ireland has continued to highlight the cumulative impact of agricultural market access in relation to all EU trade agreements. My Department has done this through engagement with the Trade Policy Committee in Brussels, as well as joining with other Member States in formally writing to the Commission outlining our concerns. In addition, our concerns have been raised at political level including this Department’s Ministerial team raising the issues with counterparts, both at Trade Council deliberations and bilaterally with the EU Commission.
Overall, Ireland remains fully committed to this negotiation, especially in view of the important economic and political gains expected for both sides from a comprehensive, ambitious and balanced EU-Mercosur Association Agreement. However, we believe that any TRQ offered in relation to beef must be structured - in terms of its size, staging, composition and the application of in-quota tariff rates - in a way that mitigates the potential impact of a Mercosur deal on the EU beef sector at this particular time.
The European Commission conducts the negotiations on behalf of Member States and as the Deputy notes tabled an offer of 70,000 tonnes of beef per annum last October. However, Mercosur countries are pushing for a much increased offer. I am aware of various media reports that the Commission may increase its last offer, but as discussions are ongoing, including this week, and a number of outstanding issues on a range of items remain to be resolved before talks can be concluded, my Department has not been notified by Commission Services of a revised offer on beef. Accordingly, it remains unclear what the final package will be, although it must be acknowledged that for the Mercosur countries offers on EU agricultural produce are crucial to securing any deal.
Ireland will only be in a position to take a view on the proposed Agreement when all elements are finalised, including on sensitive agricultural products such as beef and dairy, and our view will be informed in terms of the aggregate benefits the Agreement offers our economy as a whole.