After more than 26 years of negotiations, the EU–Mercosur Interim Trade Agreement (iTA) marks a historic turning point in relations between the European Union and the Mercosur block: Brazil, Argentina, Uruguay and Paraguay. Provisionally applied as of May 1, 2026, the agreement brings decades of intermittent talks to fruition, following renewed momentum in 2016 and a political accord reached in December 2024 in Montevideo. The deal was formally signed in January 2026 and endorsed shortly thereafter by the EU Council.
The result is nothing short of transformational. The agreement creates the world’s largest free trade area by population, connecting 720 million consumers across 32 countries and representing a combined GDP of USD 22 trillion. More than 90% of bilateral tariffs will be phased out over the next 10 to 15 years, with around 5,000 product lines becoming tariff free from day one, reshaping trade flows, supply chains and market access on both sides of the Atlantic.
What Does This Mean in Practice for Businesses, Policymakers and Investors?
In this study, our specialists provide a clear overview of the agreement, offering key insights into EU–Mercosur trade dynamics, the most significant opportunities unlocked by the iTA and the challenges that may shape its implementation.
