BRUSSELS (Reuters) – The European Union and Mexico will launch negotiations toward a new free-trade agreement later this year, as Europe seeks to tie its economy closer to North America following a deal with Canada and efforts to sign an accord with the United States.
Building on a pact with Mexico from 2000, the European Union hopes to create a transatlantic free-trade zone and help set the global rules of commerce before China does. Mexico is jumping ahead of Brazil, whose talks toward a similar deal with the European Union have stalled.
“We are ready to commit to a highly ambitious deal,” EU Trade Commissioner Cecilia Malmstrom told a forum in Brussels alongside Mexican Economy Minister Ildefonso Guajardo. “I will ask for a mandate to launch negotiations this fall,” she said.
EU officials are expected to discuss the timing of talks in more detail at an EU-Latin American summit in Brussels on June 12, where Mexican President Enrique Pena Nieto is expected.
A deal, which would take several years, would upgrade the EU-Mexican accord that was signed when the global economy was far less integrated and online commerce was in its infancy. It is part of a new generation of deals that go beyond tariffs.
As with the EU’s pact with Canada and its plans for a deal with the United States, a new accord with Mexico would further open up markets in services and allow businesses to bid for public tenders in each others’ countries.
The European Union is Mexico’s second-largest trading partner after the United States, while Mexico is a top destination for EU exports after the United States and China.
A more comprehensive deal with the European Union would allow Mexico to join Latin America’s Pacific economies of Chile, Colombia and Peru that now have modern trade pacts with both the European Union and the United States.
It also deepens a divide between those nations and Argentina, Brazil and Venezuela on the Atlantic coast, which have been more reluctant to drop barriers to trade.
“With Colombia, Chile and Peru, we are sending a signal of fresh air that we are the countries of free traders. We are responsible for more than half of Latin America’s exports to the world,” Economy Minister Guajardo said.
The European Union and the South American trade bloc Mercosur have been unable to agree a deal, with Brazil unwilling to move forward without its close ally Argentina.
Mexico is also part of an Asia Pacific free trade agreement, the Trans-Pacific Partnership, part of a broader U.S. strategy to link its economy to fast-growing markets in the Pacific.
(Reporting by Robin Emmott; editing by Philip Blenkinsop)
Like this article? Take a second to support us on Patreon!