The Interregional Association Agreement between the European Union and Mercosur: Is the Timing Right? Bruges Political Research Papers 46/2015.

The European Union (EU) and Mercosur talks have been stalled since discussions were resumed in 2000. Recurring protectionist and institutional obstacles have slowed down negotiations. The financial crisis, however, has resulted in low domestic demand in the EU. This has made the interregional association agreement (IAA) with Mercosur more attractive. The loss of the Generalized Scheme of Preference (GSP) status and the lack of a Free Trade Agreement (FTA) with the EU have both disadvantaged Mercosur. A further window of opportunity is opening up in Mercosur. In Brazil, there have been cries for a change in government. In Argentina, presidential elections will take place in October 2015 and will assuredly bring an end to Kirchnerismo. A change in leadership in both countries is expected to make agreement more likely. Protectionist policies are not expected to remain as high if there is change in government. This will provide the EU with an opportunity to advance the negotiations and conclude the IAA.