The European Union and the Mercosur bloc on Saturday signed their long-awaited trade agreement, sealing one of the world’s biggest free-trade deals after more than 25 years of negotiations and repeated political standoffs.

European Commission President Ursula von der Leyen and European Council President António Costa attended the ceremony in Asunción, Paraguay, alongside Mercosur leaders from Argentina, Uruguay and host country Paraguay. Brazilian President Luiz Inácio Lula da Silva, a key proponent of the pact, did not attend, delegating representation to his foreign minister.

“This agreement sends a strong signal to the world,” von der Leyen said at the signing ceremony. “It reflects a clear and deliberate choice. We choose fair trade over tariffs, we choose a productive, long-term partnership.”

The signing marks the culmination of a bruising political battle inside the EU that only cleared its final hurdle last week, when member states backed the agreement by a qualified majority following a flurry of last-minute concessions. France, Poland, Austria, Ireland and Hungary opposed the agreement, while Belgium abstained.

Attention now turns to ratification.

The deal must still be approved by the European Parliament and national legislatures on both sides of the Atlantic, where opposition — particularly from farming groups — is expected to remain fierce.

If fully ratified, the agreement would create a free-trade area covering more than 700 million people across Europe and Latin America. More than 90 percent of tariffs on EU exports would be phased out over time, opening new markets for European manufacturers, especially in industrial sectors.

Mercosur countries, meanwhile, would gain greater access to the EU market for agricultural products under strict quota systems designed to protect sensitive European sectors such as beef and poultry.

Von der Leyen has framed the deal as a strategic victory, arguing it reinforces rules-based trade at a moment of growing geopolitical fragmentation. EU officials see it as a way to reassert influence in Latin America amid intensifying competition from China and rising uncertainty around U.S. trade policy.

But the agreement came at a steep political price. 

To win over skeptical governments, the Commission pledged €45 billion in additional support for EU farmers, blunting resistance from countries concerned about cheap imports undercutting domestic producers.

French President Emmanuel Macron emerged as one of the pact’s most prominent losers. Despite sustained efforts to block or delay the deal — citing pressure from France’s farming sector — Paris failed to assemble a blocking minority. Italy ultimately backed the agreement after extracting safeguards and funding commitments for its own farmers.