Martin Heydon (Kildare South, Fine Gael)

I thank Deputies for raising this issue. I acknowledge the presence of those in the Public Gallery for the debate. I intend to divide my address into two parts. On behalf of the Minister for Foreign Affairs and Trade, I will speak to the broader issues of trade before addressing some of the specific agricultural elements of the Mercosur trade deal.

Trade and our relationships with partners around the world are a central feature of the Irish economic model. Ireland’s story is one of openness - openness to the world, to trade, to new ideas and to new partnerships. Unlike nations whose wealth is rooted in vast natural resources or the legacies of conquest, Ireland’s prosperity comes from something different - the talent of our people, our capacity for innovation, high quality agricultural produce and an outward-facing economy that looks to the world rather than to itself. We are a small country with a global voice, a trusted partner known for being honest, principled and constructive.

Our membership of the European Union is central to that story. It amplifies our voice, strengthens our influence and enables us to advocate for solutions that work for Ireland, Europe and the wider global economy. However, we cannot be complacent. The international environment is more volatile, more unpredictable and more transactional than at any time in recent decades. Through the EU, we have been part of an expanding network of free trade agreements that create opportunities for exports and investment, support jobs and growth at home, and uphold EU standards in food safety, animal and plant health and environmental protection. These agreements help to promote EU values globally, from labour standards to human rights to climate action. For a nation that exports 90% of the food and drink we produce, trade is crucial. Indeed, Irish agriculture has directly benefited from many of the EU trade agreements. As an example, Irish agrifood exports to Japan have increased significantly since the EU-Japan economic partnership came into effect in 2019. For context, within five short years, by 2024, Irish agrifood exports to Japan were valued at €162 million across categories such as dairy, pigmeat and beef, trade only made possible by that EU-Japan economic partnership.

Ireland’s economic strength is rooted in openness. We have enjoyed robust economic performance in recent years, with near full employment and real jobs growth across every region. Our action plans on market diversification and on competitiveness and productivity outline how we will continue to build resilience and ensure Ireland remains an attractive and competitive location for investment and job creation. In short, trade is essential for Ireland. It is the only credible way for us to sustain the jobs and investment our people rely on. However, balance will always be essential.

We have always been clear that EU trade agreements must defend our most vulnerable sectors and that our farmers’ livelihoods must not be undermined through weak or ineffective environmental standards in other countries. In that regard, Ireland has, over a number of years, raised specific concerns about the EU-Mercosur agreement, both regarding our agricultural sensitivities and the strength of the original commitments around trade and sustainability. In September, the European Commission presented its final package of proposals on the EU-Mercosur agreement for adoption by the Council and the European Parliament. This followed some 25 years of negotiations.

Foremost in my mind have been the sensitivities in agriculture in particular, and especially in the beef sector, as well as the concerns around trade and sustainability. As part of the agreement, the EU will grant Mercosur a beef quota at a reduced tariff of 99,000 tonnes, phased in over a six-year period. An economic and sustainability impact assessment, commissioned by the Government, estimated that the resulting increase in beef imports into the EU could lead to a reduction in the value of Irish beef output of between €44 million and €55 million. Concerns have also been raised that Mercosur countries do not operate to the same standards in the production of food, with the potential for negative impacts on the environment, animal welfare and food safety. Ireland and like-minded member states have repeatedly raised such concerns with the Commission and pushed for increased protections for our farmers.

The Commission has set out flanking measures to the overall agreement, focused on addressing concerns raised by the agricultural sector. These include a new legal act covering safeguards for sensitive agricultural products, a financial safety net for farmers, and stronger commitments on production standards and sanitary and phytosanitary compliance.

Ireland has also sought stronger trade and sustainability commitments. We have been clear that the original 2019 text did not go far enough. We raised these concerns repeatedly. We welcomed the fact that the Commission returned to negotiations with Mercosur to strengthen the sustainability chapter.

The resulting legal instrument agreed in December last year seeks to address the concerns raised by Ireland and other EU partners. These changes must be assessed carefully and comprehensively. We have repeatedly emphasised Ireland’s requirements for credible, legally-binding commitments on matters relating to trade and sustainable development, including climate, biodiversity and deforestation protections.

The Government also has concerns about the preferential access being given to Mercosur if South American farmers are not subject to the same sustainable farming standards as our own farmers. It is important to note, in terms of food safety, animal and plant health - SPS standards, as they are known - that the EU’s standards are among the highest in the world. The Commission has consistently stated that these are not up for negotiation. However, production standards go beyond SPS standards and take in other issues, such as environmental sustainability. Irish and EU farmers are held to a very high standard in terms of how they produce food. I have spoken on numerous occasions about concerns about preferential access being granted when farmers in the Mercosur bloc may not be subject to the same sustainable farming standards as our own. As Minister, I have had the opportunity to raise these and other concerns at Agri-Fish Council meetings since my appointment earlier this year. I have also held numerous bilateral meetings on the margins of the Council and, as recently as yesterday, I met again in Brussels with my French and Italian counterparts.

The EU-Mercosur agreement is seen by many EU countries and by the European Commission as a strategic tool for economic growth, competitiveness and supply chain security. The current global trade landscape is resulting in member states reassessing their position. There is increasing pressure within the EU to move forward on this agreement despite the Government’s best efforts to engage with like-minded member states on this. The Taoiseach, the Tánaiste and I, as Minister for Agriculture, Food and the Marine, have firmly advocated for Irish farmers at EU meetings and with the Commission. The Government has been examining the final package in its entirety to determine whether our concerns have been fully addressed and whether the necessary balance has been achieved. We have been doing this rigorously, in consultation with like-minded member states and with stakeholders, including our farming communities, who have a direct and legitimate interest in this agreement.

The Commission’s recent proposal gives some clarity on the legal structure they foresee for the agreement, whereby it will be a “split” agreement. This means that the interim trade agreement, ITA, which would include the trade pillar of the agreement, can be ratified at EU level. This can be done through adoption by qualified majority vote, QMV, through the Trade Council and by a simple majority at the European Parliament. For the QMV vote, a blocking minority would be required to prevent adoption of the agreement. This requires at least four member states, representing over 35% of the EU population, voting against or abstaining on the proposal. It is fair to say that, right now, it is far from clear that a blocking minority exists.

Ireland supports open, fair, rules-based trade. We value our membership of the EU and the opportunities that being part of the largest trading bloc brings. However, we also support a balanced approach that protects our most vulnerable sectors and ensures that international agreements uphold the highest standards of sustainability, environmental protection and labour rights. Supporting open trade does not oblige us to support every trade agreement in any form. This is the approach we have taken throughout the EU-Mercosur agreement negotiating process in seeking to protect our interests and mitigate our concerns. It is the approach we have continued to take as we examine this final package.

With the Department of Foreign Affairs and Trade, my Department continues to examine the proposals in detail and will continue to engage with the Commission to ensure that Ireland’s concerns are fully taken on board. Pending that examination and the completion of ongoing engagement, Ireland's position on the EU-Mercosur agreement remains as clearly outlined in the programme for government. The Government fully recognises the concerns raised in this motion regarding the proposed EU-Mercosur agreement, particularly in relation to Irish agriculture, the need for robust trade and sustainability commitments, and the importance of our rural economy, which every Member of this House accepts. In that context, the Government will not oppose today’s motion. The Government is committed to continuing discussions and engagement with other member states and with the Commission in the coming weeks ahead of any final Council vote.

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