The EU has given provisional backing to a sweeping trade agreement with a bloc of South American nations, clearing the way for the accord to be signed next week despite fierce opposition from France and protests by farmers across the continent.

EU ambassadors voted in favour of the pact with the Mercosur bloc at a meeting in Brussels on January 9, with at least 15 member states representing 65% of the bloc's population supporting the deal, according to diplomats.

The approval marks a significant victory for European Commission president Ursula von der Leyen, who is expected to travel to Paraguay next week to sign the agreement with Argentina, Brazil, Paraguay and Uruguay.

The accord, which has been under negotiation for more than 25 years, would establish a trade zone covering more than 700mn consumers and eliminate €4bn worth of duties on EU exports annually.

France, Poland, Austria, Hungary and Ireland voted against the deal, whilst Belgium abstained, according to diplomats. Italy's decision to back the pact, reversing its opposition from December, proved crucial in securing the required majority.

The green light came after Brussels adopted additional safeguards enabling enhanced surveillance of import flows to protect against market disruption, and following concessions including immediate availability of €45bn in farm subsidies when the next budget cycle begins in 2028 and suspension of carbon levies on fertiliser imports.

"This is the biggest free trade agreement we have negotiated," EU trade chief Maroš Šefčovič said, describing it as a "landmark" pact.

Germany, Spain and other supporters argued the agreement would provide crucial access to new markets at a time when European businesses face Chinese competition and potential fresh US tariffs. The deal would remove import duties on more than 90% of products and help EU exports of vehicles, machinery, wines and spirits to Latin America.

"It's an essential deal, economically, politically, strategically, diplomatically, for the European Union," commission spokesman Olof Gill said.

However, France and other critics warned the accord would expose European farmers to unfair competition from cheaper South American agricultural products, including beef, poultry, sugar, rice and honey.

Following the decision, French agriculture minister Annie Genevard said the battle was not over and pledged to fight for rejection by the European Parliament, where the vote is expected to be tight. "As long as the battle is not over, it is not lost," she said.

The January 9 vote came amid renewed farmer protests across Europe. French farmers drove tractors into Paris whilst Belgian colleagues blocked major roads in a show of anger ahead of the decision. Environmental groups have also opposed the deal over concerns about deforestation and agricultural practices in Latin America,

To address their concerns, negotiators stipulated that adherence to the Paris climate accord must be maintained as a core requirement, with provisions to halt the agreement partially or entirely if either side violates its climate commitments.

The commission has sought to reassure farmers by establishing safeguards allowing suspension of preferential tariffs on agricultural products in case of damaging import surges, and by creating a €6.3bn crisis fund. Brussels also highlighted that the agreement is expected to boost EU agricultural exports to South America by 50% and protect more than 340 iconic European products from local imitations.

The agreement would grant European companies access to a market of 280mn consumers in Latin America, where some 30,000 EU firms already operate. The two regions exchanged €111bn worth of goods in 2024, with the EU shipping mainly industrial equipment, pharmaceuticals and vehicles, whilst receiving South American agricultural produce, raw materials and paper products in return.

The Mercosur nations currently charge steep import duties that the pact would gradually eliminate, including rates of more than one-quarter on wine and dairy and exceeding one-third on automotive parts.

Brazilian president Luiz Inácio Lula da Silva said last month: "We have in our hands the opportunity to send the world an important message in defence of multilateralism, and to reinforce our strategic position in a global environment that is more and more competitive."

The accord must still secure approval from the European Parliament before entering into force.