EU and Mexico signed a comprehensive trade agreement

António Costa, Claudia Sheinbaum and Ursula von der Leyen, photo Daniel Cardenas/Anadolu via Getty Images

After ten years of negotiations, the European Union and Mexico signed an updated trade and cooperation agreement. "Given the current geopolitical situation, our partnership is more important than ever," said European Council President António Costa in Mexico City on Friday.

As noted, in accordance with the new agreement, Mexico abolishes practically all customs duties on imports from EU countries. In addition, bureaucratic barriers in trade are eliminated, and access to public procurement is planned to be simplified. Before the signing, Costa and European Commission President Ursula von der Leyen met with Mexican President Claudia Sheinbaum.

This was the first summit in the last ten years between the EU leadership and Latin America's second-largest economy.

According to von der Leyen, Europe intends to support the agreement with investments amounting to five billion euros. These funds are intended for infrastructure projects in Mexico.

Mexico's exports are expected to grow by one and a half times in four years.

According to estimates by Mexico's Ministry of Economy, the new agreement could increase the country's exports to the EU by about one and a half times by 2030 — to approximately 31 billion euros per year. Currently, the EU annually exports goods worth 56 billion euros to Mexico, and the total trade volume between the parties has grown by 75 percent over the decade.

The new agreement provides for duty-free access for almost all goods, including Mexican chicken meat and asparagus, as well as European powdered milk, cheese, and pork, albeit with certain quotas.

In light of the trade policy of the current US President Donald Trump's administration and other global challenges, the EU and Mexico intend to diversify their trade relations and strengthen their partnership, the parties noted at the meeting in Mexico City. In addition to trade issues, the new version of the agreement also includes provisions on topics such as climate change, human rights, and international cooperation.

The signing of the final agreement with Mexico will take place after ratification within the EU.

According to a report by the German state foreign trade agency Germany Trade & Invest, Mexico intends to gradually abolish duties on products such as poultry meat, pork, cheese, and chocolate.

The agreement with the European Union also protects geographical indications of origin for a number of products: Parma ham, Bavarian beer, Tyrolean bacon, and others. At the same time, the EU ensures its "access to the country's most important raw material resources," according to the preliminary agreement.

After the completion of the ratification process within the EU, the signing of a comprehensive agreement between Brussels and Mexico City is expected. Thanks to the North American Free Trade Agreement with the USA and Canada, Mexico, with a population of 130 million people, is an important manufacturing hub, including for German companies.

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