Parliament backs deeper political and economic ties with Chile

On Thursday, MEPs approved the EU-Chile Advanced Framework Agreement and its complementing deal on trade and investment liberalisation.

The agreements lay down the framework for deeper and broader political and economic cooperation between the like-minded partners on global issues, such as foreign and security matters, sustainable development, environmental protection, climate change, sustainable energy, rule of law and human rights. For the first time in an EU deal, there is a dedicated trade and gender chapter, with both sides committing to eliminate discrimination against women. Under the trade pillar, around 99.9% of EU exports will be tariff-free except for sugar, which is expected to increase EU exports by up to EUR 4.5 billion. The most sensitive agricultural goods are exempted from full liberalisation. These include meat, certain fruits and vegetables and olive oil.

The deal is expected to secure better access to raw materials and clean fuel such as lithium, copper and hydrogen. The agreement also includes binding commitments on social, labour and environmental obligations based on International Labour Organisation standards and the Paris Agreement.

The EU-Chile Advanced Framework Agreement (AFA) was adopted with 358 votes in favour, 147 against and 45 abstentions, the accompanying report setting out the reasons for approving it with 319 votes in favour, 113 against and 121 abstentions. MEPs also approved the Interim Trade Agreement (ITA) by 376 votes in favour, 114 against and 56 abstentions, which contains only the AFA’s trade and investment liberalisation provisions and requires ratification only at EU level.

Quotes

María Soraya Rodríguez Ramos (Renew, ES), rapporteur for the Foreign Affairs Committee said: “The new EU-Chile Advanced Framework Agreement is of key geopolitical importance, as it will be the only trade agreement with Latin America approved during this mandate. This agreement is a clear example of the EU’s political commitment to strengthening our regional cooperation and reinforcing our ties with a crucial Latin American partner. We are focusing not only on trade but also on key matters such as sustainable development, climate change, and gender equality.”

Samira Rafaela (Renew, NL), rapporteur for the International Trade Committee said: “This agreement is ground-breaking, featuring as it does a first of its kind gender and trade chapter, a trade and sustainability chapter, and references to the rights of indigenous peoples. This agreement shows trade can indeed be responsible and fair. We have been waiting for this modern and progressive agreement for a long time. It is important we collaborate with like-minded partners – to facilitate the energy transition, to create more jobs, protect human rights, and to ensure our mutual security.”

Next steps

After Parliament’s approval, now Council also needs to adopt the trade part of the agreement. The Advanced Framework will need to be ratified by member states.

Background

The EU-Chile Association Agreement entered into force in 2005, but as trade and investment relations have recently not lived up to their full potential, the two sides agreed to modernise the deal. As a result, the EU and Chile signed the Advanced Framework Agreement (AFA) last December, which consist of a political dialogue and cooperation pillar and a trade and investment pillar. It is complemented by an interim Trade Agreement (ITA), which includes only the trade and investment liberalisation elements of the AFA that fall under exclusive EU powers. This means that the ITA will only need to be ratified at EU level, while the AFA also needs to be ratified by all member states individually. The ITA will then expire once the AFA enters into force.