27 March 2026
In a rapidly evolving global economic landscape, TEHA Club has launched a dedicated Observatory focused on the EU–Mercosur Partnership Agreement (EMPA), with the objective of analyzing its impact on European and Italian companies and supporting strategic decision-making processes.
The EMPA involves the European Union and the Mercosur countries (Argentina, Brazil, Paraguay and Uruguay). It represents a landmark development in international trade relations and is expected to unlock significant opportunities by reducing trade barriers, strengthening economic ties and fostering new investment flows between two regions representing over 720 million consumers.
Unlocking business and investment opportunities between the EU and Mercosur
The EU is already Mercosur’s second-largest trading partner in goods (14.8% of trade), after China (23.5%) and ahead of the United States (12.5%). Bilateral trade of goods has increased sharply over the past decade, reaching 55 billion euro in exports and 54.5 billion in imports in 2025. Half of the EU’s exports to Mercosur consist of manufactured goods (machinery, pharma, vehicles), while imports are mainly raw materials (agricultural, oil, and minerals). EU-27 exports to Mercosur grew by 33% between 2019 and 2024. Since 2020, Italian exports mantained a consistent growth, while Netherlands, Spain, and France decreased.
After more than 25 years of negotiations, the EMPA is set to become the largest free trade agreement ever concluded by the European Union. The agreement will open up new opportunities for business and investments by boosting trade and investments, securing supply chains and upholding European standards. Beyond macroeconomic impact, it will also introduce substantial benefits for companies, including:
- progressive elimination of tariffs on a wide range of goods
- improved access to public procurement markets
- strengthened supply chains through access to critical raw materials
- enhanced protection of European standards and geographical indications - of which, 57 are Italian.
Estimated impacts of the EMPA
On March 24, 2026 the European Commission announced that starting from May 1, 2026 the Interim Trade Agreement (iTA) signed in January will be provisionally applied with Mercosur countries that completed the ratification and formally notified the EU. By 2040, EU exports of goods and services to Mercosur are projected to increase by 48.7 billion euro (a +39% rise compared to a no-agreement scenario), while Mercosur exports to the EU are expected to grow by almost 9 billion euro (+17%).
The deal will also help integrate Mercosur industries into the EU’s highly innovative value chains, enhancing their competitiveness. Moreover, it will enable Mercosur countries to move beyond commodity and raw materials exports and diversify their economies by producing higher-value goods and services.
Once the agreement is fully implemented, the overall impact on EU GDP is estimated at 77.6 billion euro, corresponding to approximately +0.1% of GDP, and for Mercosur, the expected gains are equal to 9.4 billion euro, corresponding to approximately +0.3% of its GDP.
These developments are expected to create a more integrated and competitive transatlantic economic space, offering new avenues for growth, particularly for small and medium-sized enterprises.
Supporting informed leadership in a changing world
The Observatory builds on TEHA Group’s long-standing commitment to providing forward-looking insights and high-level analytical tools to institutions and businesses, addressing key transformations in global trade and international competitiveness. It is designed to support companies in adapting their internationalization strategies and positioning themselves effectively in a changing global context.
For further information on the Observatory and related insights, consult our Study: "The EU-Mercosur Partnership Agreement. Unlocking a new era of business and investment opportunities".