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Qabil Ashirov

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The European Union and the Mercosur bloc are set to sign their long-awaited trade agreement on Saturday, marking a major milestone in relations between Europe and South America.

European Commission President Ursula von der Leyen will travel to Paraguay on 17 January for the signing ceremony, a Commission spokesperson confirmed. She will be accompanied by European Council President António Costa, according to his cabinet.

The move follows a vote on Friday in which a majority of EU member states backed the signing of the agreement, clearing the final political hurdle after years of negotiations.

Once in force, the EU-Mercosur deal would create the world’s largest free-trade area, covering around 700 million people. From Brussels’ perspective, the agreement represents a significant geopolitical gain at a time when China’s economic influence in Latin America is expanding and US trade policy has become increasingly protectionist under President Donald Trump.

The deal aims to reduce tariffs and deepen trade links between the EU and Mercosur, which comprises Argentina, Brazil, Paraguay and Uruguay.

Supporters argue the agreement will boost exports, investment and strategic ties on both sides of the Atlantic, while critics within Europe have raised concerns over environmental standards, agricultural competition and enforcement mechanisms.

Saturday’s signing is expected to open the door to ratification processes in both the EU and Mercosur member states, a step that could still face political challenges in several European capitals.