The mega trade deal that has French farmers in turmoil

As the ink dried on one of the world’s biggest trade deals, signed in Uruguay this month and hailed as a milestone for the global economy, anger was brewing thousands of miles away in France.

Under the agreement Between the EU on the one hand and Argentina, Brazil, Paraguay and Uruguay on the other, tariffs will be significantly reduced and the permitted import and export quantities will be increased.

The deal would affect almost 800 million people.

This is in stark contrast to Donald Trump’s plans to significantly increase protectionism when he returns to the White House next month.

The deal still needs to be approved by the 27 EU member states and France plans to block it, fearing it could harm its agricultural sector.

Alix Heurtault, a 34-year-old French farmer, says she is worried about her future if the proposed deal goes through.

“I fear the deal will make it even more difficult for farmers like me to make ends meet,” she says.

That’s why she’s keeping her fingers crossed that the French government will manage to stop it.

The proposed trade deal will result in more South American beef, chicken and sugar entering the EU at lower prices. In the opposite case, companies such as European cars, clothing and wine would have more access to the Mercosur zone.

For France to block the agreement, it must convince at least three other EU countries, representing at least 35% of the total population, to join the agreement. Ireland, Poland and Austria are also against it, but Italy will probably also have to join in to reach the required population quota.

And with the media providing very conflicting reports about Italy’s position, we will have to wait and see which path Italians take when the vote takes place sometime in 2025.

Meanwhile, French farmers continue to pressure Paris not to back down. French President Emmanuel Macron is listening, calling the trade deal “unacceptable in its current form.”

Ms. Heurtault grows sugar beet, wheat and barley on a 150-hectare farm in the small village of Villeneuve-sur-Auvers, 60 km south of Paris.

She says the deal would hit French farmers hard to help EU producers. “It feels like we are a bargaining chip. Farmers in the Mercosur countries (the name of the bloc: Argentina, Brazil, Paraguay and Uruguay) have fewer restrictions on pesticides and lower labor costs.”

Ms Heurtault’s view is widespread across the French agricultural sector, where protests have occurred regularly in recent months.

A few weeks ago, around 200 farmers unloaded bales of straw in front of the Grand Palais museum and exhibition center in Paris.

They lit red flares and chanted slogans like “We feed you, show us some respect.”

The protest coincided with an annual meeting of commodity importers and exporters held at the venue.

Stéphane Gallais, livestock farmer and national secretary of the farmers’ union Confédération Paysanne, which organized the event, explained why it took place.

“Today’s demonstration is a stance against free trade, in particular against the EU-Mercosur agreement, which we have opposed since it was first discussed in the late 1990s,” he said.

While France is against the trade agreement, other EU states such as Germany, Spain and Portugal are firmly in favor of it.

Advocates welcome the fact that it would represent a stark contrast to Trump’s threats of increased protectionism.

“It would be a good signal at a time when there is a movement in the opposite direction of economic fragmentation and protectionism, especially given the re-election of free-trade-sceptic U.S. President Donald Trump,” said Uri Dadush, research professor of trade policy at The Washington Post the University of Maryland in the USA.

Prof Dadush adds that although the impact on European farmers will be negative, he believes it will be very limited.

“The agreement represents a threat to European farmers by giving the most competitive agricultural sector in the world access to their market, but we are talking about a small degree of liberalization spread over a long period of time,” he says.

He points out that Mercosur states would continue to have restrictions on exports to the EU under the agreement. For example, the proposed, initially increased annual quota for beef exports, which still only accounts for less than 1% of EU meat consumption.

Prof Dadush adds that “the agreement is an opportunity to advance much-needed market-oriented reforms in the heavily subsidized EU agricultural sector and in the heavily protected Mercosur factory sector.”

Chris Hegadorn, associate professor of global food policy at Paris’ Sciences Po university and former secretary of the U.N. Committee on World Food Security, says the deal would be beneficial for Europe overall – including its farmers.

“It obviously depends on the subcategory you’re looking at, but French cheese and wine producers will benefit,” he says.

He adds that it will also improve health and environmental standards in Mercosur countries and strengthen ties with the EU, at a time when “China is also trying to gain a foothold in Latin America.”

But David Cayla, an economics lecturer at the University of Angers in western France and a member of the left-wing collective The Dismayed Economists, doubts that the EU can impose higher standards in Latin American countries.

“It is impossible to control their implementation,” he says. “Our farmers will only face increasing competition from countries with better climates and more fertile soils.”

“But we have to protect European agriculture – this is also a question of food sovereignty,” he emphasizes, adding that the Covid-19 pandemic has shown how quickly global supply chains can collapse in times of crisis.

Antoine Gomel, who took over his family’s 24-acre chicken and beef farm in a small village near Boulogne-sur-Mer in northern France in 2017, says rejecting the trade deal is about saving the French countryside.

“Farms keep disappearing and our villages remain deserted – the agreement will only accelerate this,” says the 42-year-old.

“But farms are crucial for rural cohesion, not least because they create jobs. People in France and abroad are increasingly voting for the far right because they feel disoriented and alone.”

“Farms can help bring them back together by literally anchoring them.”

Back in front of the Grand Palais in Paris, cleaners swept away the remaining straw from the demonstrators.

Farmer Stéphane Gallais was still nearby, watching them. “The EU-Mercosur agreement is extremely damaging and it would be truly symbolic if EU member states did not ratify it,” he said.