‘Isolated’ France faces political storm over EU-South American trade deal

BRUSSELS — Paris is rapidly running out of both the time and political clout required to halt a European Union trade deal with South America, only adding to the woes of President Emmanuel Macron, who is likely to face a vitriolic backlash from France’s all-powerful farmers.
The European Commission and EU heavyweights such as Germany and Spain make little secret of their desire to close a deal before the end of the year with the Mercosur bloc of Argentina, Brazil, Uruguay, Paraguay and newcomer Bolivia. German Chancellor Olaf Scholz says the deal should be done “quickly.”
France has long been the most dogged holdout on the accord, fearing that a deluge of beef and other agricultural imports from giant Latin American producers will undermine French farmers, one of the country’s most politically powerful groups.
In previous years, Paris had sufficient political capital in the EU to hold an effective veto over the pact, but this influence is now waning after Macron’s thumping defeats in this year’s EU and national elections. The danger for Paris is that other EU countries will now simply enact the accord over France’s head, and the political impact of that will be explosive.
“It is hard to see how the French government and its weak political support in the French parliament could survive a Mercosur trade agreement,” said François Chimits, an economist at the French research center CEPII. 
“It’s a casus belli for French public opinion, which is specifically not fond of free trade, to say the least, and extremely protective of its agricultural sector. Any measures mixing the two produce political kryptonite for French leaders,” he added. 
The time window for French officials to stem the pro-Mercosur momentum is narrowing fast.
EU and Mercosur chief negotiators met from Oct. 7-9 in Brazil in a bid to drive the talks forward. Proponents of the deal reckon progress is also likely at a summit of the G20 group of leading economies in Rio de Janeiro in November, setting the stage for an endgame by the end of the year, or early 2025.
Up against the clock, French officials in Brussels — long used to steering the EU agenda — are finding their options are unusually limited.
Realizing they will no longer be able to block the deal single-handedly or build a coalition to stop the agreement, they are instead focusing on influencing the endgame.
“I don’t think France is trying to bring more countries together. There’s a lot of pressure from the Commission; [the agreement] continues to move forward,” said a French official, granted anonymity to discuss the highly sensitive topic.
In recent briefings, top French diplomats told French officials from the European Parliament that the country was becoming increasingly isolated, according to three people briefed on the meetings. They also hinted at an expectation the deal would be sealed early next year. 
“There has been an acceleration in [EU-Mercosur] negotiations which has underlined France’s isolation on the Mercosur issue,” said one of the people briefed on the meetings. 
The French Permanent Representation in Brussels denied such meetings took place.
The trade agreement — covering more than 800 million people and accounting for a fifth of global economic output — has been a top priority of Commission President Ursula von der Leyen. But it eluded her in her first mandate after Macron stood in the way of a successful conclusion to the talks earlier this year. 
The French Permanent Representation, representing France at the EU level in Brussels, said Paris was continuing to argue that the deal was unacceptable. 
“The Permanent Representation is constantly reminding all its interlocutors of the French position, which is that the text is not acceptable as it stands. It recalls that other member states share this position,” said a spokesperson.
Although the EU and Mercosur closed formal negotiations in 2019, the EU has put off signing the agreement in order to add extra conditions to address deforestation and climate concerns and to assuage French farmers’ worries about a glut of Latin American produce.
France insists that it is not against the free-trade deal per se, but simply wants its environmental and agricultural demands to be met. Indeed, much of the French manufacturing industry — in stark contrast to farmers — supports the deal. A French diplomat pushed back against what he called “the caricaturing the French position.”
“We are not against free trade in itself. We need a good deal with all the guarantees,” said the French diplomat. “We ask that the Commission includes in the negotiation robust elements on climate, deforestation,and mirror-clauses that protects our farming interests, fair competition conditions as well as access to critical primary resources.”
But the worrying fact for the French is that the rest of the EU just isn’t as scared of standing up to Paris as it used to be.
“We’ve set our red lines, but the French influence is reduced; [the Commission] continues to negotiate without being paralyzed by the fear of France,” said the French official cited above. 
These tensions over Mercosur are symptomatic of the loss of French influence in Brussels, and support comes from relatively small EU countries such as Austria, Ireland and the Netherlands.
The Elysée did not respond to POLITICO’s request for comment.
Camille Gijs reported from Brussels, Clea Caulcutt reported from Paris.