Brussels 17.01.2026 European and South American officials have signed a major free trade agreement, paving the way for the European Union’s largest-ever deal amid tariff threats and deepening uncertainty around global cooperation.

[ES] 🤝 Comunicado Conjunto sobre la firma del Acuerdo de Asociación entre el MERCOSUR y la Unión Europea

[PT] 🤝 Comunicado Conjunto sobre a assinatura do Acordo de Associação entre o MERCOSUL e a União Europeia

🔗 https://t.co/poxTYW8F4Y pic.twitter.com/dHLZXk82Dh

— MERCOSUR (@mercosur) January 17, 2026

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The deal sealed today, January17, between the 27-nation European Union and South America’s Mercosur bloc creates one of the world’s largest free trade areas after 25 years of negotiations.

We have the clearest possible win–win deal before us.

With companies on both sides of the Atlantic
competing on an equal footing.

With elimination of billions in tariffs.

That means high value. Real growth. Good jobs. https://t.co/sZOqIGoY7K

— Ursula von der Leyen (@vonderleyen) January 17, 2026

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The agreement, designed to lower tariffs and boost trade between the two blocs, must now gain the consent of the European Parliament and be ratified by the legislatures of Mercosur members.

“We choose fair trade over tariffs, we choose a productive long-term partnership over isolation,” EU chief Ursula Von der Leyen said at the signing ceremony in Paraguay’s capital, Asuncion.

Paraguay’s President Santiago Pena also praised the agreement as sending “a clear signal in favour of international trade” in “a global scenario marked by tensions”.

Brazilian Foreign Minister Mauro Vieira said it was a “bulwark … in the face of a world battered by unpredictability, protectionism, and coercion”.

Panama’s President Jose Raul Mulino, from left, Bolivian President Rodrigo Paz, European Council President Antonio Costa, European Commission President Ursula von der Leyen, Paraguay’s President Santiago Pena, Argentina’s President Javier Milei, Uruguay’s President Yamandu Orsi and Brazilian Minister of Foreign Affairs Mauro Vieira, pose for a family photo during a meeting to sign a free trade deal between the European Union and Mercosur in Asuncion, Paraguay, Saturday, January 17, 2026.

The deal received a greenlight from the majority of European nations last week, despite the intense opposition from farmers and environmental groups, who have raised concerns over a surge of inexpensive South American imports and increased deforestation. A vote of 21 to 5 EU members showed a profound malhaise regarding the deal, with Austria, France, Hungary, Ireland, and Poland voting against it.
Thousands of Irish farmers protested last week against the agreement, accusing European leaders of sacrificing their interests.

From Ireland to Greece, European farmers are protesting the European Union's largest free trade accord with South American trading bloc Mercosur.

Read more stories: https://t.co/JpTsni2Vfb pic.twitter.com/kkc44Ii6Qx

— SBS News (@SBSNews) January 12, 2026

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But the leaders in Paraguay said the pact would bring jobs, prosperity, and opportunities to people on both sides of the Atlantic.

Together, the EU and Mercosur account for 30 percent of global GDP and more than 700 million consumers. The treaty, which eliminates tariffs on more than 90 percent of bilateral trade, is expected to come into force by the end of 2026.

“With the signing today of the free trade agreement between the European Union and Mercosur, this is an extremely dark day for French agriculture. It is also the symbol of a succession of failures, of a series of surrenders, on the part of a President of the Republic incapable of defending the higher interests of the Nation. After two terms of Emmanuel Macron, the voice of France no longer carries any weight” wrote the leader of opposition Jordan Bardella.

Avec la signature aujourd’hui du traité de libre-échange entre l’Union européenne et le Mercosur, c’est un jour extrêmement sombre pour l’agriculture française.

C’est aussi le symbole d’une suite d’échecs, d’une série d’abandons, de la part d’un président de la République…

— Jordan Bardella (@J_Bardella) January 17, 2026

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The deal opens a way for the Mercosur countries make up a “huge area that produces enormous amounts of agricultural [products] and raw minerals” that the EU consumes.

“The sinister Mercosur agreement is being signed today in Paraguay. It seals the death sentence for our beautiful French agriculture and threatens our health. Let’s mobilize before it’s too late!” said the leader of party “Debout la France!” Nicolas Dupont-Aignan, reflecting upon the signature in Paraguay.

NEW – Thousands of Irish farmers protest the Mercosur trade deal, "Europe should not be outsourcing our food security to South America… we have been incredibly naive in Ireland to put Europe's interests in Ireland, ahead of Ireland's interests in Europe." pic.twitter.com/DbkEH5HORL

— Eatlovepray2 (@Eatlovepray22) January 11, 2026

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Just before the signing ceremony, US President Donald Trump announced new tariffs against several European countries over their opposition to his push to take control of Greenland.

The U.S. leader has refused to rule out taking military action to seize the Arctic island – a semi-autonomous territory that is part of Denmark – fuelling widespread international concern and protests.