Georgetown Americas Institute

The event featured Cecilia Malmström, former European commissioner for trade and current nonresident senior fellow at the Peterson Institute for International Economics (PIIE), in dialogue with Nicolás Albertoni, visiting fellow at GAI and former vice minister of foreign affairs of Uruguay, and Antoni Estevadeordal, resident fellow at GAI and senior research fellow at the Barcelona Institute of International Studies. Alejandro Werner, founding director of GAI, offered introductory remarks. Together, the panel explored prospects for trade integration, the future of the EU-Mercosur agreement, and pathways toward regulatory convergence amid deep global uncertainty.

Rewriting Trade Architecture in an Era of Fragmentation

Estevadeordal opened the conversation by highlighting a central challenge facing both regions: a rapidly proliferating “spaghetti bowl” of overlapping and often incompatible trade agreements. He noted that the expansion of bilateral free trade agreements, rather than progress through the World Trade Organization (WTO), had created complex webs of rules of origin that disproportionately burden small and medium-sized enterprises. Malmström acknowledged this as one of the critical downsides of today’s fragmented trade regime, emphasizing that incoherent rules create customs bottlenecks, raise compliance costs, and undermine the benefits of trade openness.

From a European perspective, she argued, the ideal long-term solution would be greater regional consolidation within Latin America—an internal market capable of harmonizing standards and presenting unified negotiating positions externally. While recognizing that such a project could take years, she identified rules of origin as the most urgent and technically complex area for cooperation. Malmström urged both regions to explore incremental steps, such as benchmarking from the EU’s experience with Mediterranean partners or drawing lessons from Asia’s growing coordination efforts under ASEAN.

Estevadeordal noted that many modern mega-regional agreements—including the CPTPP and RCEP—have advanced precisely by consolidating older, disconnected FTAs. He encouraged creative thinking on “light-touch” forms of convergence that do not require full treaty renegotiation, a point Albertoni echoed when discussing Latin America’s interest in building bridges across its diverse regulatory frameworks.

Regulatory Standards and the Role of the EU-Mercosur Agreement

Albertoni emphasized that, beyond goods, digital services, climate policy, and sustainable finance are becoming increasingly central to trade partnerships. Malmström underscored that the EU-Mercosur agreement—25 years in the making—offers an important platform for such regulatory convergence between Europe and Latin America. The agreement, she explained, includes mechanisms for mutual recognition of existing standards, allows and creates opportunities for joint standard-setting in emerging fields where international norms are still evolving, such as biotechnology, nanotechnology, and life sciences.

Both Malmström and Albertoni emphasized the importance of this agreement as a benchmark for internal Latin American harmonization. The EU’s unified regulatory system, Malmström explained, gives it a powerful advantage in trade negotiations: one set of rules applies across 27 member states. Mercosur’s experience—requiring four national positions to coalesce into one—illustrates how coordination challenges can dilute negotiating leverage. 

With the EU-Mercosur agreement once again approaching a potential signing date— Malmström expressed cautious optimism. Failure to conclude the agreement now, she warned, would be a geopolitical setback, sending a damaging signal about the reliability of Europe’s partnerships in the Western Hemisphere. 

Trade, Values, and the Future of Interregional Cooperation

During the Q&A session, Malmström addressed concerns about the EU’s approach to labor, environmental, and human-rights provisions in trade agreements. While acknowledging criticism from some developing countries, she emphasized that EU agreements largely reference existing international conventions already signed by partner governments. She highlighted examples where countries such as Mexico have welcomed provisions on corruption or public procurement transparency as complementary to domestic reform efforts.

The discussion closed on a cautiously optimistic note: if the EU-Mercosur agreement can be finalized in the coming weeks, it may mark not only the culmination of a decades-long negotiation but also the beginning of a deeper and more coherent trans-Atlantic trade architecture for the twenty-first century.