Sefcovic: Mercosur agreement to lead to lower store prices; supply-chain costs unrelated to the deal

Brussels – The free trade agreement between the European Union and Mercosur is not designed to harm consumers. On the contrary, thanks to the removal of tariffs on products imported from Latin America, costs for European citizens are expected to fall. The Commissioner for Trade, Maros Sefcovic, has once again defended the trade agreement signed at the end of 2024 with the South American countries involved (Argentina, Bolivia, Brazil, Paraguay, and Uruguay), and indeed goes on the counter-offensive: any price increase, should it occur, would depend solely on the operators and the intermediary fees they set.

 “The Commission remains confident that, overall, trade agreements, including the EU-Mercosur Interim Trade Agreement (ITA), will translate to lower consumer prices in the
stores,” Sefcovic began, responding to a parliamentary question from the sovereigntist benches. Then came the pointed remark: “The Commission has not specifically quantified how gains resulting from the agreement
would be distributed along the supply chain.” This is because “price transmission along the agri-food chain
depends on several factors, including market structure, costs and contractual relations.” 

 Mercosur, therefore, was designed to make bilateral trade more cost-effective, and Sefcovic is effectively turning the spotlight on operators within the supply chain. Should any distortions arise, it will be possible to determine this shortly, given that the EU–Mercosur agreement came into force provisionally on 1 May. In any case, “The Commission does not agree with the statement that the ITA is undermining European
producers,” the Trade Commissioner said, rejecting further accusations and criticisms regarding an agreement that a part of the European Parliament never liked.

“The degree of tariff liberalisation for EU sensitive agricultural products is limited
to a very small volume in order not to expose vulnerable producers to excessive competition.” Therefore, Sefcovic points out, “the impact for those specific goods is by construction expected to be very limited.”