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GTAP Resources: Resource Display

GTAP Resource #6394

"The EU-Mercosur Trade Agreement: standards, impacts, and implications for trade competitiveness"
by Bethmann, Erika, Angelica Marrero-Sanchez and Fernando Gracia

In June 2019, the European Union (EU) and Mercosur – the South American trading bloc comprised of Argentina, Brazil, Paraguay, and Uruguay – reached a political agreement regarding the trade part of the EU-Mercosur Association Agreement. Although the EU-Mercosur Association Agreement has been under negotiation since 1999, there have been few computable general equilibrium (CGE) analyses undertaken that have provided an analysis of its potential effects on the U.S. economy. In addition to providing an update to the existing CGE literature on this agreement, and its potential effects on the U.S. economy, this paper will also analyze concurrent trade policy issues. For example, this agreement has garnered press recently as European civil society groups and some government representatives have threatened the ratification of the agreement for failing to protect the Amazon rainforest with enforceable environmental provisions. This paper aims to update the existing, yet somewhat outdated literature on this particular agreement, with additional qualitative analysis of the impact of environmental provisions in existing EU and Mercosur member country trade agreements—provisions that are currently serving as a barrier to ratification in the EU. For example, the “trade and sustainable development” chapter of the EU-Mercosur agreement states that the parties will honor concessions already made as part of the Paris Agreement. However, publications and statements by the Brazilian government promote deforestation and development of the Amazon rainforest that contradict such agreements made in the Paris Agreement. The Global Trade Analysis (GTAP) framework is used to simulate the implementation of the June 2019 EU-Mercosur Agreement in Principle.

Resource Details (Export Citation) GTAP Keywords
Category: 2021 Conference Paper
Status: Not published
By/In: Presented during the 24th Annual Conference on Global Economic Analysis (Virtual Conference)
Date: 2021
Created: Bethmann, E. (4/15/2021)
Updated: Bethmann, E. (6/24/2021)
Visits: 1,053
- Land use
- Non-Tariff barriers
- Preferential trading arrangements
- Central America
- European Union

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