European Commission (EC) President Ursula von der Leyen pledged to allow European Union (EU) farmers to soon access 45 billion euros from the next phase of the Common Agricultural Policy (CAP) budget, starting from 2028, if the South American Common Market (Mercosur) trade agreement is signed.
The commitment was made in the context of the EU entering a key stage to complete an agreement that has lasted more than 25 years of negotiations.
Ms. Ursula von der Leyen made this proposal in a letter to member countries on January 6, as France and Italy continue to demand specific guarantees to protect farmers from the risk of competition from Latin American agricultural products. The important vote on the Mercosur agreement is scheduled to take place in Brussels on January 9.
According to the letter, the 45 billion euros from CAP will "ensure more resources from 2028 to meet the needs of farmers and rural communities".
This amount is equivalent to 2/3 of the CAP budget allocated to the mid-term review of the EU budget framework 2028-2034, and also supplements the 6.3 billion euro reserve fund that has been planned to respond to market fluctuations.
The EC's proposal was made in the context of the wave of protests from EU farmers still spreading. Many agricultural associations warn that the Mercosur agreement could open up markets for beef, poultry, soybeans and cheap sugar from Latin America, which are produced according to environmental and food safety standards different from the EU, thereby putting great pressure on the income and competitiveness of European farmers.
At the EU summit in December last year, the European Commission and Germany - one of the countries strongly supporting Mercosur - believed that the agreement would be approved, although no specific signing date has been set.
Italian Prime Minister Giorgia Meloni at the time said that signing in December is not appropriate, but leaving open the possibility of support from the beginning of 2026 if Italy's concerns are resolved.
In her latest statement, Ms. Meloni said that she welcomed the European Commission's proposal, emphasizing that this measure was taken "at the request of Italy" to protect European farmers.
The Mercosur agreement was finalized in principle by Ms. von der Leyen in December 2024 with Argentina, Brazil, Paraguay and Uruguay, aiming to form a transatlantic free trade zone. However, the agreement has revealed deep divisions within the EU.
The supporting group, led by Germany and Spain, accelerated the passage, while another group led by France sought to prevent it, citing concerns about unfair competition and production standards.
In that context, Italy becomes a key vote. The agreement needs to achieve a qualified majority to be passed, while only 4 countries, representing 35% of the EU population, can form a blocking minority.
According to the plan, ambassadors of 27 EU member states will vote on the Mercosur agreement on January 9. If approved, the Chairman of the European Commission will be able to officially sign the agreement in Latin America next week.
