Austria, which took over the reins of the EU Council of Ministers on 1 July, considers that the quality of Mercosur's (Argentina, Brazil, Paraguay and Uruguay) offer in the negotiations on the trade section of an association agreement with the EU is still insufficient and that more time than the goal of the general elections in Brazil in October will be need to conclude an agreement.
"On the qualitative level, much must be done, not only on agricultural issues. The European Commission can count on our support", Austria's minister for digital and economic activity, Margarete Schramböck, told EUROPE in Vienna on Wednesday 4 July.
"The elections (in Brazil) will first play a role. Afterwards, serious negotiations can be resumed. (The conclusion of an agreement) will take more time. The quality of the agreement is of crucial importance", Schramböck added.
European and South American negotiators are meeting for a new round of technical level talks in Brussels on 9 July.
The Commission, which is negotiating on behalf of the EU, still hopes for a swift agreement, but it awaits progress on key issues for the EU – market access for cars and spare parts, for dairy products, and maritime transport, as well as geographical indications.
Although Uruguay, which is at the helm of the South American bloc this semester, hinted that an EU-Mercosur ministerial level meeting would be held on the sidelines of the EU-Latin America and Caribbean foreign ministers' meeting in Brussels on 16-17 July in order to advance the negotiations, the Commission said on Wednesday that it was "premature to envisage a political commitment, given the current state of the negotiations" (see EUROPE 12055).
This meeting is "something very likely", Schramböck nevertheless says on behalf of the Austrian Presidency.
"If Mercosur manages to present a united front and does not continue divided on the Brazilian problem concerning automobiles and the dairy products issue, this will be the homestretch", a European source in the agriculture sector states.
The friction within the Commission between its DG Trade, which promotes the EU's offensive industrial interests, and DG Agriculture, which promotes its offensive agricultural interests (dairy products, geographical indications and spirits) and the defence of sensitive products, headed by beef, confirms also that the talks are entering the homestretch.
Beyond the bargaining on access to the agricultural and industrial markets, the talks are stumbling, on the technical level, on three key issues – geographical indications, maritime services and public procurement – according to the progress report from the last negotiation round in Montevideo in early June (see EUROPE 12048). (Original version in French Emmanuel Hagry with Mathieu Bion)