The EU and South America’s Mercosur formally sign a long‑awaited trade pact in Asuncion to cut more than 90% of tariffs.
EU and Mercosur Sign Historic Free Trade Agreement
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Top officials from the European Union and the Mercosur bloc signed the Partnership Agreement and an Interim Trade Agreement in Asuncion, Paraguay on January 17, 2026, concluding more than 25 years of negotiations and involving Argentina, Brazil, Paraguay and Uruguay.
The accord will gradually eliminate over 90% of tariffs across goods for a market of more than 700 million consumers and covers measures on environment and quotas; it now requires approval by the European Parliament and ratification by Mercosur legislatures, with implementation timelines and protections for EU farmers.
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🧭 FAQs
• What countries are covered by the deal in South America? Argentina, Brazil, Paraguay and Uruguay are included in the agreement.
• When and where was the agreement signed? It was signed in Asuncion, Paraguay on January 17, 2026.
• What must happen before the deal takes effect in the EU? The European Parliament must consent and EU ratification procedures must be completed.
• How many consumers does the new trade zone affect? The agreement covers a market of more than 700 million consumers across the EU and Mercosur.
