New European Union free trade agreements: estimating their effects on agri-food and sustainable development

CRISTINA MITARITONNA; ANTOINE BOUET; LEYSA MATY SALL; MARIA PRISCILA RAMOS

Bordeaux

Conferencia; 26 GTAP Conference; 2023

Recently the European Union (EU) engaged in signing a new agreements with New Zealand,modernizing the ones with Chile and Mexico and, after the Lula election in Brazil, possibly reaching an agreement with Mercosur (Argentina, Brazil, Paraguay and Uruguay). Other possible talks to sign deep agreements are also envisaged with Australia and possibly with two large Asian low medium income countries (India and Indonesia).Of course, each agreement has certain specificities, such as the sourcing of critical raw materials such as lithium in Chile and in Argentina, and spath flour in Mexico. However, some common points can be highlighted. The EU demands expanded access for its industrial goods on those markets, but also services and investments. On the other hand, the offensive interests of EU partners are mostly in the agricultural and agri-food sector; they all demand for greater access to the EU agricultural markets. The EU offers to enlarge access to its market through the allocation of bilateral tariff-rate quotas (TRQs) for some agricultural products, at reduced or even zero duty. However, as these are often sensitive products for European agriculture, the EU tries to limit its openness to the European market through limited import quotas’ enlargements, or new quotas openings. As far as details on the negotiations are available, these Free Trade Agreements (FTAs) are agreements have also strong contents in terms of sustainable development (in terms of emissions and deforestation). Using a dynamic general equilibrium model, MIRIAGE-POWER, featuring different sources of energy including renewable energy and in-depth representation of greenhouse gases (GHGs) we try to assess the economic and environmental impacts of these agreements. with a special focus on the Agri-food sectors