The EU gave a long-delayed go-ahead on Friday (January 9, 2026) to a huge trade deal with South American bloc Mercosur championed by business groups but loathed by many European farmers — overriding opposition led by key power France.

Most of the European Union’s 27 nations backed the pact following an Ambassadors’ meeting in Brussels, paving the way for it to be signed later this month in Paraguay.

More than 25 years in the making, supporters see the deal as crucial to boost exports, support the continent’s ailing economy and foster diplomatic ties at a time of global uncertainty.

European Commission chief Ursula von der Leyen called it “proof that Europe charts its own course and stands as a reliable partner”. She said she looked forward to the signing — which Argentina said was planned January 17.

German Chancellor Friedrich Merz said the deal sent “an important signal of our strategic sovereignty and capacity to act”, a message echoed by Spain, which said it would “forge shared prosperity” with Latin America.

On the Mercosur side, Brazil’s President Luiz Inacio Lula da Silva hailed “a historic day for multilateralism”.

And Paraguay’s Foreign Minister, one of the four founding members of Mercosur, along with Argentina, Brazil and Uruguay, defended the deal as “balanced”.

But the European Commission, which negotiated the text, failed to win over all of the bloc’s member states.

Heavyweight France, where politicians across the divide are up in arms against a deal attacked as an assault on the country’s influential farming sector, led an ultimately unsuccessful push to sink it.

Ireland, Poland, Hungary and Austria also voted against the accord. That was not enough to block it; however, after holdout, Italy ultimately threw its weight behind the pact.

‘Economic clout’

The deal will create a vast market of more than 700 million people, making it one of the world’s largest free trade areas.

Part of a broader push to diversify trade in the face of U.S. tariffs, it will bring the 27-nation EU closer together with Brazil, Paraguay, Argentina and Uruguay, removing import tariffs on more than 90% of products.

This will save EU businesses four billion euros ($4.6 billion) worth of duties per year and help exports of vehicles, machinery, wines and spirits to Latin America, according to the EU.

It will also help the bloc reduce its dependency on China for critical raw materials, said Agathe Demarais, of the European Council on Foreign Relations, a think tank.

“The conclusion of the EU-Mercosur trade deal is great news for Europe’s global geopolitical and economic clout,” she said.

Germany, Spain and other backers believe the deal will provide a welcome boost to their industries hampered by Chinese competition and tariffs in the United States.

But France and other critics opposed it over concerns that their farmers would be undercut by a flow of cheaper goods, including meat, sugar, rice, honey and soybean, from agricultural giant Brazil and its neighbours.

French Agriculture Minister Annie Genevard argued that it was “not the end of the story”, as the European Parliament had still to vote on the deal.

With the deal still requiring approval from the European Parliament, France has warned against any attempt to bring it into force before then.

‘Pain’ vs ‘benefits’

Farmers in several European countries mounted a final show of anger against the text’s approval, marching in protest in Warsaw and blocking roads in France and Belgium.

“There is a lot of pain,” Judy Peeters, a representative for a Belgian young farmers group, told AFP at a protest on a motorway south of Brussels. “There is a lot of anger.”

Over the past months, the commission has been at pains to reassure farmers and their backers that pros outweigh cons.

It has stressed that the accord is expected to boost EU agri-food exports to South America by 50%, in part by protecting more than 340 iconic European products — from Greek feta to French champagne — from local imitations.

It also laid out plans to set up a 6.3 billion-euro crisis fund and safeguards allowing for the suspension of preferential tariffs on agricultural products in case of a damaging surge in imports.

The latter were tightened further at the last minute by member states lowering the threshold for action, a late concession to Italy.

Angry farmers disrupted traffic in Milan with their tractors Friday, dumping barrels of straw and pouring milk on the ground in front of the regional council building.

But Italian Prime Minister Giorgia Meloni defended an agreement she hoped would “bring benefits in many areas” and “for everyone”.

Published – January 10, 2026 08:51 pm IST

Berlin:

Germany is set to hold the crucial federal election on Sunday (February 23) to elect its next chancellor. The snap polls were called by chancellor Olaf Scholz when his coalition government fell apart at the end of last year, the results of which will shape the future of Europe’s most influential nation and the European Union.

In the race for top leader is an incumbent chancellor seeking a second term, the opposition leader, the current vice chancellor and — for the first time — a popular leader of a far-right party. The elections are receiving an unusual level of interest from onlookers outside the country, including the world’s richest man Elon Musk, who caused an outcry in Germany by throwing his weight behind the far-right Alternative Alice Weidel.

A Look At Top Contenders 

Olaf Scholz: The 66-year-old centre-left Social Democrat has been Germany’s chancellor since December 2021. Seeking a second term, Scholz has a wealth of government experience, having previously served as Hamburg’s mayor and as German labour and finance minister. 

As chancellor, Scholz launched an effort to modernize Germany’s military after Russia’s invasion of Ukraine and made Germany Ukraine’s second-biggest weapons supplier. His government prevented an energy crunch and tried to counter high inflation. But his three-party coalition became notorious for infighting and collapsed in November as it argued over how to revitalize the economy — Europe’s biggest, which has shrunk for the past two years.

Friedrich Merz: Germany’s 69-year-old opposition leader has emerged as the front-runner in the election campaign, with his centre-right Union bloc leading polls. Merz became the leader of his Christian Democratic Union party after longtime Chancellor Angela Merkel — a former rival — stepped down in 2021. Since then, he has taken the party in a more conservative direction. 

During the election campaign, Merz has made curbing irregular migration a central issue. However, he lacks experience in government. He joined the European Parliament in 1989 before becoming a lawmaker in Germany five years later. He took a break from active politics for several years after 2009, practising as a lawyer and heading the supervisory board of investment manager BlackRock’s German branch.

Robert Habeck: The 55-year-old Habeck is the candidate of the environmentalist Greens. He’s also Germany’s current vice chancellor and the economy and climate minister, with responsibility for energy issues. As co-leader of the Greens from 2018 to 2022, he presided over a rise in the party’s popularity, but in 2021 he stepped aside to let Annalena Baerbock — now Germany’s foreign minister — make the party’s first run for the chancellor’s job. 

Habeck’s record as a minister has drawn mixed reviews, particularly a plan his ministry drew up to replace fossil-fuel heating systems with greener alternatives that deepened divisions in the government.

Alice Weidel: The 46-year-old Weidel is making the first bid of the far-right, anti-immigration Alternative for Germany, or AfD, for the country’s top job. An economist by training, Weidel joined the party shortly after it was founded in 2013. She has been co-leader of her party’s parliamentary group since the party first won seats in the national legislature in 2017. 

Weidel has been a co-leader of the party itself since 2022, along with Tino Chrupalla. In December, she was nominated as the candidate for chancellor — though other parties say they won’t work with the AfD, so she has no realistic path to the top job at present.

When Will The Results Come?

It is likely to take several days after February 23 to confirm the final results of the election. However, based on the exit polls, fairly reliable results are likely to be out by Sunday evening, but there may still be some uncertainty as the counting of votes by post (a trend which is on the rise) takes time. The performance of smaller parties will also factor in result timing as Germany has a norm of electing a coalition government. 

Even after the full results are out, forming a new government will, most likely, take some time as talks between parties on coalition will start only after the results. The coalition might take several months to put a government together. It depends on the numbers at play and the political arithmetic – essentially the extent to which different combinations of parties agree or disagree on various policy positions.

Why Germany Forms Coalition Governments?

The proportional voting system and increased political fracturing in Germany make it extremely difficult for any one party to form a government alone and a coalition needs to be formed comprising parties that together hold more than 50 per cent of the seats in the Bundestag — the national parliament.

It is also partly political culture in Germany to prefer stable majorities as minority governments are considered to be too weak and unstable. 

Until the early 1980s, there were usually three parties (conservative, social democrats and liberals) in Parliament. However, currently, the country has seven parties in the Bundestag.

Parties In Fray 

Germany has two centrist, “big-tent” parties: Scholz’s centre-left Social Democrats (SPD) and the opposition conservatives, an alliance of the Christian Democrats (CDU) and their Bavarian sister party, the Christian Social Union (CSU).

Both have lost support in recent years, with smaller parties such as the Greens and far-right Alternative for Germany (AfD) gaining ground.

The SPD, conservatives, Greens and AfD are all fielding candidates for chancellor.

Also running are the pro-market Free Democrats (FDP), the far-left Linke and the leftist Sahra Wagenknecht Alliance (BSW), who are all at risk of missing the 5 per cent threshold to make it into parliament, according to opinion polls.

Polls

The conservatives have been leading nationwide polls for more than two years and are at 30 per cent, according to the latest survey published by Forsa Institute on February 16, followed by the AfD at 20 per cent.

Scholz’s SPD, with 16 per cent, has dropped to third from the first place it achieved in the 2021 election. It is followed by the Greens on 13 per cent and Linke on 7 per cent. The FDP is polling at 5 per cent, with the BSW at 4 per cent, according to the latest poll.

Analysts say polls can shift quickly as voters are less loyal to parties than they once were. In the 2021 election campaign, the conservatives went from frontrunner to runner-up within a few months.