Analysis from the Peruvian Ministry of Agriculture suggests that their country’s new FTA with the EU could increase agro-exports by a third by 2016 (from US$1.5bn to US$2bn). Likely areas of export growth include: bananas, fresh flowers, beans, asparagus, onions, olives, frozen potatoes, paprika, canned artichoke, chestnuts, fresh grapes, citrus, fresh avocado, oranges, mangos, coffee, tea and barley.

On 3 May 2011, the EurActiv network, with Reuters, reported on the findings of an official EC study, on the impact of the Mercosur agreement on the agricultural sectors, which had been presented to EU member states’ representatives at the end of April. The report found that overall the impact of a possible EU-Mercosur FTA ‘is negative, but the intensity of the effects considerably varies across agricultural products [and] regions’. It estimated that ‘European farmers could lose more than €3 billion in annual revenue by 2020’, with up to 33,000 farm jobs being lost in Europe if the draft EU-Mercosur deal were approved.

According to the report, EU beef production would fall by over 150,000 tonnes by 2020, in addition to ‘a predicted 200,000-tonne annual increase in beef imports from Argentina, Brazil, Paraguay and Uruguay’. Ireland, Britain and France would be the worst affected, with declines in annual farm revenues of 4%, 3% and 2% respectively. EU cereals exports to Mercosur would increase by about 1m tonnes a year by 2020, ‘while the deal would have little impact on EU sugar production or prices’.

Looking beyond the food and agriculture sector, the Commission is reported to have estimated that ‘an EU-Mercosur trade deal would deliver net economic benefits worth about €4.5 billion a year to both regions.’ The aim at present is to conclude an EU-Mercosur FTA by the end of 2011. The negotiations, however, face strong opposition from farmers’ organisations and the French and Irish governments.

European farmers’ organisation Copa-Cogeca has repeatedly warned of the adverse effects of an FTA with Mercosur. Their chief policy advisor, Shelby Matthews, has argued that ‘one quarter of our food imports already come from Mercosur and we depend on them for two-thirds of our protein feed requirements.’ The current negotiations ‘would cause a huge rise in beef, pork poultry, maize, garlic, sugar, ethanol, citrus fruit/juice imports to the EU from these countries’, and this ‘would have a catastrophic impact on the EU agricultural sector and the economy and employment in rural areas.’ He further argued that ‘offering very competitive Mercosur countries additional access to the EU market would also send another very negative signal to the least developed and ACP countries.’

Copa-Cogeca representatives have further stressed that imports from Mercosur countries ‘do not meet the EU’s high environmental and quality standards’, with serious concerns being expressed about the safety of meat products imported from Mercosur.

On another regional front, in April the EU announced the granting of duty-free, quota-free access for ‘all agricultural products, processed agricultural products and fish and fishery products’ in the Palestinian territories, with immediate effect. The notable exceptions, however, were fruit and vegetable products, ‘which would be subject to a duty if their price was below a set level’.