This policy report, part of the Strategic Autonomy Rules for Trade in European Regions [STARTER], provides a detailed analysis of the trade pillar of the EU–Mercosur partnership agreement, which was reached in December 2024. It uses a combination of qualitative insights and quantitative modelling to evaluate the anticipated impact on European regions.

The analysis comprises three main steps. First, it provides a qualitative overview of the main provisions of the EU-Mercosur trade agreement, which is one pillar of a broader partnership that also includes political and cooperation components. Secondly, it offers a descriptive assessment of EU-Mercosur trade patterns in order to identify the countries, regions and sectors most involved. Thirdly, it uses a general equilibrium gravity model (GE PPML) to estimate the effects on welfare and trade across 296 European regions.