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EU-Mercosur steel trade tensions rise as agreement faces new hurdles

15 Jan 2026 15:24 reported by Munsey

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The long-awaited EU-Mercosur free trade agreement, negotiated over 25 years, faces fresh complications as the European Union prepares to impose new steel tariffs despite promising duty-free access to Mercosur countries. 

The EU's contradictory approach involves simultaneously offering zero-percent tariffs on steel products while planning to raise general steel tariffs to 50%, potentially affecting Argentina, Brazil, Paraguay, and Uruguay. 

The European Parliament has emphasized its requirement for formal approval before any provisional application of the agreement, adding another layer of complexity to the ratification process. 

Bilateral safeguard clauses in the agreement could allow the EU to impose protective measures without mandatory compensation, creating political risks that may undermine support for the deal among South American partners.

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