(Photo: President Macri was an enthusiastic supporter of the FTA, but his successor perhaps not)
Buenos Aires, August 23rd. The burning of the Amazonian rainforest could be the better excuse to tore down the FTA between Mercosur and the EU. Neither France president Macron, nor the probably next Argentine Peronist government feel comfortable with this agreement that brings big headaches for both.
According to the Independent UK newspaper “France will block an EU trade deal with Brazil and its neighbours over the country’s handling of fires in the Amazon rainforest, a spokesperson for Emmanuel Macron has said.Brazil’s far-right president Jair Bolsonaro has been criticised around the world for his response to the fires, which scientists say are man-made and campaigners have linked to businesses looking to exploit the land. “The president can only conclude President Bolsonaro lied to him at the Osaka summit,” a spokesperson for the Elysee told the Reuters news agency.
It would be good news for the candidate Alberto Fernandez and his team. The preliminary agreement will impose them some restrictions on economic politics, like export taxes. Argentina commits to removing export taxes and the gap between raw materials and industrial byproducts in the soybean complex.
But the next Government needs the export taxes to finance the fiscal deficit and to prevent that food prices rise and generate more inflation.
According to eFarmNewsAr sources, the problem lies in the fact that if the EU parliament and Brazil agree on the draft it results mandatory for Argentina.
Also, Ireland could help Argentina. ” Leo Varadkar, Ireland’s prime minister, also indicated that Ireland could try and block the EU trade deal. ‘There is no way that Ireland will vote for the EU-Mercosur Free Trade Agreement if Brazil does not honor its environmental commitments,’ Mr Varadkar said”. And even the UK prime minister also could block the agreement. “Boris Johnson stopped short of saying he wouldn’t sign a trade deal with Brazil, telling reporters in a visit to the south-west: “I passionately share the view of Emmanuel Macron, and one of the things I am going to be raising at the G7 is the horrific loss of habitats and species around the world”.
The Argentine farming sector supports the FTA with the EU, but the industry has raised serious objections, and for the Peronism, to protect the industry sector is a central issue.