European leaders signed the EU-Mercosur trade deal on Saturday with Argentina, Brazil, Paraguay, and Uruguay, aiming to strengthen the bloc’s strategic and economic position. European Commission President Ursula von der Leyen called the agreement “25 years in the making” and described it as an “achievement of a generation” that prioritizes long-term partnerships over tariffs.

The deal, which would create a transatlantic free-trade zone, is seen by supporters as vital for countering China’s growing influence in Latin America. EU imports from Mercosur countries have fallen behind China’s share, reversing a trend seen in 2000 when the EU’s presence was six times larger. Advocates also argue the deal will diversify EU trade amid tighter US market access and growing reliance on Chinese materials and technology.

However, the agreement has exposed deep political divisions within the EU, with France emerging as the most vocal opponent. Paris voted against the deal in a key Council vote on 9 January, despite a majority of member states backing it. Critics in France argue the deal threatens domestic agriculture, exposing farmers to competition from Latin American imports that may not meet EU production standards.

The debate has intensified ahead of the European Parliament’s ratification process, scheduled to begin Monday. Lawmakers remain divided along national lines. France, Poland, Hungary, Ireland, and Austria opposed the deal, while Belgium abstained. In France, the issue has become a political flashpoint, feeding eurosceptic sentiment and prompting far-right Rassemblement National leader Jordan Bardella to launch a no-confidence motion in both the European Parliament and the National Assembly.

Supporters of the deal counter that France’s agricultural struggles are largely home-grown and point to concessions built into the agreement, including environmental safeguards, tariff-rate quotas for sensitive products such as beef and poultry, and a €45 billion support package for EU farmers from 2028. Despite these measures, Paris remains unconvinced, with President Emmanuel Macron noting that the deal would raise EU GDP by just 0.05% by 2040 and that tariff reductions on EU cars would be phased in over 18 years.

Other EU sectors stand to benefit from the agreement, particularly services, dairy, wine, spirits, and access to public procurement markets. Spanish MEP Javier Moreno Sánchez emphasized the deal’s importance in a “geopolitical and geo-economic context,” citing the need to negotiate on equal terms amid global trade tensions. German MEP Svenja Hahn highlighted that fears of agricultural disruption may be overstated, noting low utilization of quotas in similar deals like CETA.

After 25 years of negotiations, the Mercosur deal represents one of the EU’s most ambitious trade agreements. While supporters hope to build momentum for ratification in the European Parliament, opposition in France and a broader eurosceptic wave in parts of the bloc could complicate its implementation. Analysts warn that the deal’s political fallout may last longer than its economic impact, particularly in France, where public resistance to free-trade agreements runs deep.