Maladministration of Mercosur trade talks by EU Commission?

Maladministration of Mercosur trade talks by EU Commission?

Sustainability impact assessments (SIAs) must be completed before concluding trade negotiations in future

European Ombudsman Emily O’Reilly has found maladministration in her assessment of the European Commission’s negotiations on a trade agreement between the EU and Mercosur.

She does not, however, make recommendations other than urging the Commission to ensure in future that sustainability impact assessments (SIAs) are completed before concluding trade negotiations.

She investigated after complainants (five human rights and environment groups) contended that the commission had disregarded its own SIA guidelines and breached EU law, by concluding the Mercosur trade agreement.

Considering that the negotiations have been concluded and that the commission will finalise an SIA imminently, the ombudsman said it would serve no purpose to make further recommendations.

Since 1999, SIAs have been carried out for all major EU trade negotiations. These independent assessments include analysis of potential economic, social, human rights, and environmental impacts of trade agreements. SIAs are normally finalised and published, before trade negotiations end.

The first EU-Mercosur SIA was published in 2009. In 2017, the commission started a second SIA, but only an inception report was completed when a trade agreement in principle ended negotiations in 2019.

The trade agreement final texts have not yet been signed, and ratification has not begun.

The ombudsman welcomed the commission’s intention not to propose the final agreement for signature before the SIA is finalised, and noted the commission’s expectation that SIA results will contribute to an informed ratification debate.

ICMSA president Pat McCormack said this latest finding must remove any possibility of the agreement proceeding, with a number of EU member states saying they won’t ratify the agreement in its present form.

That the EU concluded an agreement with countries with such a mixed record on environmental and climate action is “alarming”, said Mr McCormack.

IFA president Tim Cullinan said it was astonishing the commission attempted to proceed with a Mercosur deal without a full assessment.

“Farmers will be curious as to why the Mercosur trade deal is the only time this has happened,” he said.

“The commission’s stance on Mercosur is at odds with its other policies on Farm to Fork and the Green Deal.”

Mercosur SIA results, which the commission says it will soon publish, are unlikely to show Mercosur members Brazil and Argentina in a good light, because Brazil was ranked No 71 and Argentina No 61, out of 72 countries, when the EU Commission recently published its Transitions Performance Index (TPI), monitoring progress towards sustainable development goals.

The other Mercosur members, Paraguay and Uruguay, were not included in the TPI report, which showed only Russia is rated worse than Brazil for sustainability progress, of 13 main EU trading partners.

The TPI is part of the groundwork for the EU Green Deal plan to make the EU’s economy sustainable.

The EU believes four transitions are needed — in the economy, the social sphere, the environment, and in governance — to progress to sustainability. The TPI measures these transitions.

Countries were rated for their environmental transition progress from 2010 to 2019, and Brazil (minus 0.8 %) was grouped with Russia, Iceland, Algeria and Iran, five countries where care for the environment is deteriorating.

Brazil was rated worst of 72 for progress in governance transition, at minus 16.1%.

Brazil’s rankings were dragged down most by a low equality rating, 71st out of 72 countries, also 71st for disposable income after taxes and transfers, and 71st for income share held by the poorest quintile of the population.

Similar problems dragged down Argentina’s rankings out of 72, rated 67th for the income share held by the poorest quintile, and 67th for the employment rate of the population aged 20-64.

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