EU to Exit Trade Pact If Brazil Drops Climate Goals, France Says

(Bloomberg) -- European Union countries won’t ratify a free-trade deal with South America if Brazil doesn’t take measures to achieve the greenhouse gas emissions targets it agreed to in the 2015 Paris climate accord, French Ecology Minister Francois de Rugy said.

Top EU officials reached a breakthrough in market-opening negotiations last week with counterparts from the Mercosur group of Argentina, Brazil, Paraguay and Uruguay, paving the way for an agreement to expand goods shipments worth almost 90 billion euros ($102 billion) a year.

The EU-Mercosur draft accord still needs to be fine-tuned over the coming six months to a year. Before entering into force provisionally, the deal would then need to gain approval from EU governments and the European Parliament in a process likely to last about another year.

“The deal will be ratified only if Brazil meets its commitments,” the French minister said Tuesday on Europe 1 radio. “We’re not signing trade deals with countries which exit the Paris accord. Signing the Paris accord isn’t just about signing it, it’s also about implementing a policy that allows to achieve cuts in greenhouse gas emissions, and to protect the Amazon forest.”

While President Jair Bolsonaro has stepped back from a decision to withdraw Brazil from the Paris Agreement, he plans to open up more of the Amazon, having laid out initiatives to loosen restrictions on farming and mining activities in protected areas.

©2019 Bloomberg L.P.

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