logo logo

Spain pushes for quick EU action to approve Chile trade deal

Bloomberg | 21 April 2022

Spain pushes for quick EU action to approve Chile trade deal

By: Alonso Soto and Thomas Gualtieri

Spain wants the European Union to move quickly to ink a free-trade deal with copper powerhouse Chile that was put on ice late last year.

Spain’s Secretary of State for Trade, Xiana Mendez, plans to visit Santiago next week to determine whether Chile’s new government wants to push ahead with the updated trade deal that was nearly finalized in 2021.

“The deal was blocked in recent months amid other priorities, but we hope that this agreement with Chile will be one of the first ones to be accelerated,” Mendez said in an interview. “I’m going to Chile to talk about the trade negotiations and see how we can promote it. The prospects for moving forward with the deal are good.”

The European Commission negotiates the bloc’s trade agreements, so there are limits to any progress to be expected from Spain’s overtures. France held up pending trade deals with Chile and New Zealand over concerns it could stir controversy ahead of April’s presidential election. Free-trade agreements can be divisive in France and have been politicized in past election campaigns.

President Emmanuel Macron faces nationalist leader Marine Le Pen in a final vote on Sunday in what has been a surprisingly tight race that pits opposing views about globalization and free trade.

Renewed interest in a deal with Chile, which holds some of the world’s biggest copper and lithium reserves, comes as the EU races to reduce its dependence on Russia for key commodities. Over the past decade the EU has lost ground against China and the U.S., which are Chile’s top trading partners, comprising 12% of total trade with the South American country.

Mercosur Next

President Gabriel Boric, who was sworn in last month to lead Chile’s most left-wing government in a half a century, has said that multilateralism and strengthening international ties will be a hallmark of his foreign policy. In a meeting with EU ambassadors, Foreign Affairs Minister Antonia Urrejola said she expects the deal to be finalized soon.

Spain also wants to revive a deal with the South American trade bloc known as Mercosur that has encountered resistance on concerns about Brazil’s commitment to protect the Amazon rainforest.

Mendez said Madrid, along with the Czech Republic and Sweden, will use their upcoming EU presidencies to conclude an additional declaration to strengthen environmental commitments and pave the way for the agreement.

Despite opposition from some bloc members worried about the entry of cheaper food products from Brazil and Argentina, Mendez said the deal remains a priority for Spain. The elusive pact, which has dragged on for more than two decades, would be one of the world’s largest encompassing more than 750 million people.

 source: Bloomberg