The European Free Trade Association (EFTA) has signed a Free Trade Agreement (FTA) with MERCOSUR that will significantly lower trade barriers to Icelandic and Norwegian seafood exports entering Latin America.
Once fully ratified by the member countries – Iceland, Liechtenstein, Norway and Switzerland – the deal will reduce duties on about 97 percent of trade between the European bloc and members of MERCOSUR (Argentina, Brazil, Paraguay, and Uruguay), creating a massive new free trade zone of 300 million consumers with a combined GDP of USD 4.3 trillion (EUR 3.8 trillion).
The deal removes tariffs on seafood entirely, which currently stand at nine percent, creating potential opportunities for the seafood-producing nations of EFTA.
At the signing event, which took place at Rio de Janeiro’s Itamaraty palace, representatives from various countries spoke about the importance of cooperation as global markets brace for the full effect of U.S. tariff policies, which are coming into force this fall.
Media reports indicate Brazil has already seen a more than 18-percent decline in exports to the U.S. since fifty-percent tariffs took effect in early September, Valor International reported.
In the face of such pressures, both EFTA and MERCOSUR have recently accelerated their attempts to set up strong free trade agreements with other nations and trade groups.
Brazilian Foreign Minister Mauro Vieira said that this work is an “important step by MERCUSOR to diversify its commercial partnerships.”
MERCOSUR is currently awaiting European Parliamentary approval for a complete but unratified free trade agreement with the European Union. The two groups had already reached a trade deal in 2019 after years of negotiations, and began talks for additional deals in 2023.
EFTA has also recently completed trade deals with Vietnam, Singapore, and Malaysia.
“In a world of uncertainty, we are proving that it is possible to strengthen multilateralism and free trade. Trade brings people together, and development promotes peace,” Brazilian Vice-President and Minister of Development, Industry, Trade, and Services Geraldo Alckmin said.
Vieira said that he believed the deal would strengthen both trade blocs.
“This deal will gradually deepen economic integration between Mercosur and Europe, with the active participation of our countries in the global economy,” Vieira said.
Representatives of Iceland and Norway said the agreement offered an important opportunity for the seafood industry.
“It is positive that the agreement contributes to a tariff reduction for seafood exports,” Norwegian Minister of Fisheries and Oceans Marianne Sivertsen Næss said. “This could open up the export of products that we have previously exported little of to Latin America, such as salmon.”
Norwegian Ministry of Foreign Affairs Senior Adviser Kjetil Elsebutangen emphasized the importance of the Brazilian market, and said the country is the top trade partner for Norway outside of the U.s> and the E.U.
“Over 200 Norwegian companies operate in Brazil, and their ongoing investments in the country are expected to grow,” Elsebutangen said in comments to Datamar News.
Norwegian Minister of Trade and Industry Cecile Myrseth added that the agreement shows that “EFTA states lead the way … for the future in [these] turbulent times when it comes to trade.”
