Safety in numbers
As Washington raises its tariff walls, Brussels keeps collecting trade partners, and rebranding free trade as self-defence. The European Commission brought its interim agreement with the four Mercosur countries into force on May 1, after Argentina and Uruguay ratified it and a negotiation that had run for a quarter of a century finally closed. Fredrik […] Safety in numbers was originally…
As the European Union raises its tariff walls, Brussels continues to form trade partnerships and rebrand free trade as self-defense. The European Commission finalized an interim agreement with the four Mercosur countries on May 1, after Argentina and Uruguay ratified it. Over the past year, the EU established or activated agreements with India, Indonesia, and Mexico, bringing the total to 80 countries with preferential arrangements.
Maroš Šefčovič, the Commissioner for Trade and Economic Security, framed 2025 around three challenges: soothing relations with the United States, countering China's assertiveness, and capitalizing on increased demand from other nations for trade deals. Negotiations with Washington over a customs agreement proved to be the most challenging assignment of his career, requiring hundreds of hours of discussions.
Despite American tariffs targeting both allies and adversaries, the EU's trade department, DG Trade, reported that goods trade with preferential partners increased by 3.1 percent in 2025, while trade with the rest of the world grew by only 1.4 percent. The 44 agreements in force at the end of 2025, covering 76 partners, accounted for 46.3 percent of the bloc's external trade.
The Commission's chief trade enforcement officer, Denis Redonnet, oversees the compilation of the report, which notes that 20 trade barriers were removed or partially lifted in 14 countries during the year, and a mission to Brazil in October 2025 resolved several obstacles for European exporters in that nation. The report emphasizes the importance of trade in advancing both economic security and openness, as outlined by Šefčovič in a September speech to German diplomats.
According to the report, preferential partners supply a quarter of the EU's critical raw materials, with imports of these materials from Canada rising by 62 percent. Congo's government banned cobalt exports in October 2025, impacting European refineries reliant on the resource, but subsequently implemented a quota that caps shipments through 2027.
Over a quarter of the EU's mineral imports now come from Canada. BusinessEurope, the continent's largest employers' federation, remains cautious about the outlook, forecasting EU export growth of just 1.7 percent for 2026 despite the new agreements. The EU's deal with Chile, which entered effect in February 2025, demonstrates the potential of the new partnerships.
Bilateral trade between the EU and Chile reached 20.8 billion euros in the first 11 months, with EU machinery exports up by nine percent and chemicals by eight percent. The report indicates that exports to partners with a deal increased by 250 billion euros in the year, while sales to Russia declined by 54.5 billion euros. The EU is currently negotiating trade agreements with Malaysia, the Philippines, Thailand, and the United Arab Emirates, as well as signing narrower pacts on digital trade and investment with Singapore, South Korea, South Africa, and Angola.
Once all the agreed deals take effect, preferential terms will cover 53.3 percent of the EU's trade. For export-dependent economies in central and eastern Europe, reliant on German and Italian supply chains, every new market represents an additional hedge against potential disruptions. Redonnet will present the report to partner organizations in Brussels on October 20.
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