Pandemics, rising prices of raw materials, the worsening of the climate emergency or the proliferation of armed conflicts act as a “shock doctrine”. In short periods, dynamics that have been brewing for years in the subsoil of the world economy are accelerated. In a context of geopolitical disputes over scarce resources, these dynamics translate into rapid and profound rearrangements of economic, political and trade agendas.

The recent acceleration of negotiations for a Trade Agreement between the EU and Mercosur, after almost 20 years of lethargy, is part of this European need to secure scarce raw materials and markets that pivot the “green transition” from a certain strategic autonomy. Beyond its importance, the possible signing of such an agreement would allow the EU to send a message to its global competitors while serving as a key to open up new strategic investments by European multinationals in Latin America linked to this new extractivist cycle.

This report, commissioned by the European Left group in the European Parliament (The Left) and prepared by Jacobin Latin America, attempts to situate the EU-Mercosur agreement in a framework of analysis where the current global geopolitical moment, the European Green Pact and the EU’s external trade agenda intersect. Latin America is today one of the main battlegrounds in the dispute between old and new powers for controlling raw materials needed to ensure a transition towards a greener and more digital economy. The result is an intensification of mining and extractivist pressure in the region, where 4 the agreement with the Mercosur countries is both a fundamental piece and the key to a new accumulation phase of European “green” capitalism.