Von der Leyen pledges early funding to farmers in final push to secure Mercosur deal

European Commission President Ursula von der Leyen has promised EU member states and European Parliament President Roberta Metsola that EU farmers would gain early access to €45 billion from 2028 under the next Common Agricultural Policy (CAP) budget if the Mercosur trade agreement is signed – a last-ditch effort to secure member states’ backing for the much-delayed deal.

This is a pivotal moment in the effort to finalise the Mercosur agreement, negotiations for which have now dragged on for more than 25 years.

Von der Leyen made her pledge in a letter on Tuesday as France and Italy continue to seek guarantees for their farmers, who fear unfair competition from Latin American imports, before a crucial vote on the agreement in Brussels on Friday.

In her message, von der Leyen said the €45 billion in CAP funds would “ensure additional resources are available as of 2028 for addressing the needs of farmers and rural communities”.

That represents two-thirds of the amount set aside until the mid-term review of the 2028-2034 EU budget, and comes on top of a €6.3 billion reserve already planned to address market disruptions.

All eyes on Italy

Von der Leyen clinched the Mercosur agreement in December 2024 with Argentina, Brazil, Paraguay and Uruguay, aiming to create a free-trade area across the Atlantic.

The deal has exposed deep divisions within the EU. Supportive states, led by Germany and Spain, have pushed hard to get the deal signed, while a group led by France has sought to block it.

The future of the deal now comes down to Italy, whose support is mathematically decisive. The deal requires a qualified majority of member states, while a blocking minority of just four countries representing 35% of the EU population could derail it.

The Commission is convening EU farm ministers in Brussels on Wednesday to discuss CAP funding, as well as a French demand for reciprocity in production standards and tighter controls on farm imports.

Whether von der Leyen’s promise of CAP flexibility will be enough to sway Rome and Paris remains uncertain. France has faced a deep agricultural crisis in recent weeks, clouding its support, while Italy may view the new flexibility as sufficient to reassure farmers over future income.

Hungary and Poland confirmed before Christmas that they are against the deal, while Belgium and Austria are planning to abstain.

The ambassadors of the 27 member states will vote on the deal on Friday. If it passes, von der Leyen will be able to sign the agreement in Latin America next week.