STORY: :: The EU and Mercosur sign a trade deal after more than 25 years of negotiations
:: January 17, 2026
:: Asuncion, Paraguay
:: Ursula von der Leyen, European Commission President
"We are creating the largest free trade zone in the world. We are creating a market of 700 million people and a GDP of almost 20% of the global GDP is being traded here. This is phenomenal. And this agreement sends a very strong message to the world. It reflects a clear and deliberate choice. We choose fair trade over tariffs. We choose a productive, long-term partnership over isolation. And above all, we intend to deliver real and tangible benefits to our people and our businesses."
The ceremony was attended by the presidents of Argentina, Paraguay and Uruguay, along with von der Leyen, while Brazilian President Luiz Inacio Lula da Silva was represented by his foreign minister.
Paraguayan President Santiago Pena acknowledged significant time had been lost in reaching the agreement and challenged both blocs to deepen their partnership with greater courage and audacity, while Argentine President Javier Milei emphasized the need to preserve the negotiated terms during implementation without adding restrictive mechanisms like quotas or safeguards.
The agreement, which will reduce tariffs to boost trade between the regions, received approval from a majority of European countries last week despite criticism from farmers and environmentalists concerned about cheap South American imports and deforestation.
