Amidst ongoing political tensions between the EU and the United States, Cepi is encouraging the European Parliament to ratify a trade agreement set to eliminate tariffs from the Mercosur trade bloc and mandate deforestation efforts.
According to the European Council, the Mercosur countries – Argentina, Brazil, Paraguay, and Uruguay – form the sixth-largest economy in the world and represent the EU’s tenth-largest partner in trade goods. The EU’s trade with Mercosur was thought to be worth over €111 billion in 2024, encompassing €55.2 billion in exports and €56 billion in imports.
Pulp and paper were among the top goods imported into the EU from Mercosur, alongside mineral and agricultural products. However, Cepi draws attention to the high tariffs imposed on European exports, despite the EU’s zero import tariffs on products like pulp, paper, and board.
Under the proposed EU-Mercosur Partnership Agreement (EMPA), Cepi believes that tariffs would be removed on over 90% of goods imported and exported between the EU and Mercosur countries – including tariffs on 85% of pulp and 90% of EU paper and board exported to Mercosur. It is also hoped to overcome non-tariff barriers.
Together, these measures are expected to level the playing field in the trade relationship between the two regions and foster growth for European pulp and paper companies. With zero import tariffs already in place in the EU, it is not expected to cause a drastic rise in pulp and paper imports from Mercusor countries.
Additionally, the agreement features a strengthened Trade and Sustainable Development chapter with a legally binding annex. This will require the countries involved to make individual legal commitments to halt deforestation and cooperate on developing more sustainable supply chains.
With the Brazilian forest industry and European pulp and paper industry making their own pledges to prevent illegal logging and deforestation, Cepi encourages the countries to implement and enforce the chapter to maintain environmental and labour standards.
“The European pulp and paper industry believes in free trade and fair competition principles, but not only,” says Jori Ringman, director general at Cepi. “We do not compromise on our sustainability principles and prefer to trade and compete with players who abide by the same climate, environmental and social rules that we do.
“Europe’s pulp and paper sector remains a strong exporter. We advocate for rules-based trade and reliable partnerships to remain the standard in the dynamic and fast-moving global trade landscape.”
Cepi emphasizes that both the EU and Mercosur must ‘diversify their partnerships’, especially in light of tension in relationships between the EU and the United States. After 25% tariffs were first imposed on steel and aluminium imports last year, the European Commission sought to respond by re-enforcing suspended counter-tariffs and introducing new countermeasures.
At the time, Cepi encouraged the Commission to continue negotiations and avoid supply chain disruptions. It cited figures that the EU imports around 900,000 tonnes of pulp and almost 600,000 tonnes of paper and board from the US annually, while exporting around 350,000 tonnes of pulp and 1600,000 tonnes of paper and board.
Now President Donald Trump has announced his plans to impose a 10% tariff on Denmark, Norway, Sweden, the Netherlands, Germany, France, and the UK in his ongoing, controversial efforts to annex Greenland.
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