EU delays massive free-trade deal with South American bloc

The European Union is delaying a massive free-trade deal with South American countries after fiery protests by farmers and last-minute opposition by France and Italy, the European Commission said.

Top EU officials had hoped to sign the EU-Mercosur in Brazil this weekend, after more than 25 years of negotiations.

Instead Commission chief spokesperson Paula Pinho confirmed that the signature had been put off until January.

Experts say the delay will dent the EU’s negotiating credibility globally as it seeks to forge new trade ties amid commercial tensions with the US and China.

The deal would progressively remove duties on almost all goods traded between the two blocs over the next 15 years.

France had led opposition to the deal between the EU and the five active Mercosur countries — Brazil, Argentina, Uruguay, Paraguay and Bolivia.

Italy raised new reservations on Wednesday.

Thursday’s agreement for a delay was reached between European Commission President Ursula von der Leyen and European Council President Antonio Costa on the sidelines of an EU summit with Italian Premier Giorgia Meloni, on the condition that Italy would vote in favour of the agreement in January, an EU official said.

The decision came hours after farmers in tractors blocked roads and set off fireworks in Brussels on Thursday outside an EU summit to protest the trade deal, prompting police to respond with tear gas and water cannon.

Farmers fear the agreement will undercut their livelihoods, and there are broader political concerns that it is driving support for the far right.