EU chair Portugal aims to seal Mercosur trade deal

BRUSSELS, Jan 7 (Reuters) - EU chair Portugal said on Thursday it would try to conclude a free-trade treaty between the European Union and the South American bloc Mercosur that was agreed in 2019 after two decades of talks but has still not been finalised.

Portuguese Foreign Minister Augusto Santos Silva said his country, which assumed the EU’s six-month rotating presidency on Jan. 1, needed to make progress because failure would damage the reputation of the EU, the world’s largest trading bloc.

“Our credibility is at stake. It is a responsibility of Portugal to try to conclude this process and we assume this obligation,” Santos Silva told an online briefing.

In a breakthrough against protectionism around the world, the EU agreed in June 2019 to create a free-trade area of 700 million people with South American trade bloc Mercosur, which is made up of Argentina, Brazil, Paraguay, Venezuela and Uruguay.

But France and the European Parliament have since led opposition to finalising the details of the treaty, saying Mercosur must do more to meet its climate commitments under the Paris Agreement and that Brazil is failing to combat deforestation in the Amazon.

The Brazilian government rejects criticism that it is not doing enough to stop deforestation in the Amazon, protect the environment and prevent climate change.

The impasse reflects the complexity of the EU’s trade deals, which seek to go beyond market access and trade tariffs to encompass European environmental and foreign policy goals.

But Santos Silva also said that France and Ireland should not use the environment to deflect concerns about the scale of future meat imports into the EU, saying that European countries would benefit by being able to export more to Latin America.

The election of President Alberto Fernandez in Argentina in August 2019 has also raised doubts about the commitment of Mercosur, the world’s fourth-largest trade bloc, to the EU deal.

Fernandez has said he wants to renegotiate parts of the agreement.

Santos Silva said trade negotiations would not be reopened.

Reporting by Robin Emmott Editing by Gareth Jones