The European Union and the Mercosur bloc have finalised a sweeping trade agreement after more than two decades of negotiations, marking one of the largest commercial pacts in the world. The deal is designed to reduce tariffs on a wide range of goods, including cars, wine and beef, and to make cross-border trade between Europe and South America easier.

Officials say the agreement also includes labour and sustainability provisions intended to address concerns about environmental damage and the rights of workers. Those safeguards were a major sticking point during the talks, especially among critics who warned that expanded agricultural trade could worsen deforestation and undercut local producers.

For the EU, the pact offers new access to a large consumer market across South America. For Mercosur members, it could create stronger demand for agricultural exports and help draw more investment into the region. Supporters argue the deal could lower costs for businesses and strengthen economic ties at a time of global trade uncertainty.

Still, the agreement is likely to face scrutiny from farmers, environmental groups and lawmakers in Europe before full implementation. Even so, the breakthrough ends years of stalled negotiations and signals a renewed push for trade liberalisation between the two blocs.