EU presses on with Mercosur trade talks despite French nerves

By Philip Blenkinsop and Julia Fioretti

BRUSSELS, Oct 20 (Reuters) - The European Union will push to conclude free trade talks with South American bloc Mercosur by the end of the year, leaders said, despite French reservations over the surge of farm imports an agreement would bring.

French President Emmanuel Macron had said he was in no hurry to do a deal with the beef-exporting Mercosur countries of Argentina, Brazil, Paraguay and Uruguay and succeeded in pushing trade onto the agenda of an EU leaders summit in Brussels.

"We had a short moment just after midnight to discuss international trade," European Commission President Jean-Claude Juncker told a news conference after the leaders met on Friday.

Juncker said Europe had a great opportunity to seal trade deals with countries across the world, while respecting European values and standards and the "reciprocity sought by the French president".

"We will continue to do everything we can to conclude the negotiations with Mercosur before the end of the year. It's important. We underestimate the importance of Mercosur for the European Union," he said.

The European Commission says the savings the EU could make from reduced import tariffs with Mercosur would be three times greater than for deals with Canada and Japan combined.

EU exports to Mercosur from cars to pharmaceuticals are subject to duties of about 4.4 billion euros ($5.2 billion) per year. France, said a Commission source, would be among one of the greatest beneficiaries if these were cut.

Dutch Prime Minister Mark Rutte said he and fellow EU leaders had decided not to slow down the talks and still wanted a deal by the end of the year.

The French president said Europe faced an internal challenge to persuade the public to support to trade deals.

"And an external one which is to have a growth agenda and, at a time when the United States is turning isolationist, to be able to build strategic commercial relationships with several regions of the world."

France has been concerned that the Commission was rushing towards a deal with Mercosur, while also seeking to open talks with Australia and New Zealand, two other countries that want to expand exports of farm products.

With 10 other countries, it told the Commission last month that Europe first needed to determine how much beef, ethanol and other farm products it can afford to let in under current and future deals.

One of them, Ireland, injected a note of caution on Friday.

"A Mercosur deal by Christmas is optimistic," its Prime Minister Leo Varadkar said. ($1 = 0.8472 euros) (Additional reporting by Jan Strupczewski and Robert-Jan Bartunek; Editing by Andrew Heavens)

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