For Große Entrup, the agreement is more than just an economic step. It sends out a signal in terms of foreign policy:

"On the world stage, the EU presents itself as a reliable partner for cooperation and fair competition. A clear contrast to China, which wants to compensate for its weak growth with export offensives, and to the USA, which is becoming increasingly aggressive in its 'America First' economic and security policy muscle-flexing."

However, ratification is not yet complete. Although Commission President Ursula von der Leyen can travel to Paraguay, the approval of the European Parliament remains crucial.

The economic dimension is considerable: in 2024, the German chemical-pharmaceutical industry exported goods worth 4.3 billion euros to the Mercosur states, but only imported 837 million euros back.

The mechanical engineering industry also sees opportunities that go beyond South America. VDMA Managing Director Thilo Brodtmann recommends using the tailwind of the Mercosur agreement for the free trade agreement with India:

"Federal Chancellor Friedrich Merz should use the tailwind of the Mercosur agreement and push ahead with the conclusion of the free trade agreement with India, preferably by the end of January. The agreement would significantly strengthen the competitive position of our industry, as India currently imposes tariffs of up to 8 percent on mechanical engineering products."

Brodtmann also warns against trade barriers:

"It is also essential to remove technical barriers to trade on the Indian side. India's own standards and local requirements such as 'Make in India', which link market access to production in the country, are a noticeable obstacle to trade."

India is a key growth market for mechanical engineering, which could help to reduce dependencies on China:

"India is one of the fastest growing economies and offers enormous potential for the mechanical engineering sector. We should make the most of this opportunity."

With the Mercosur agreement - and potentially a trade pact with India - German industry could expand its global position, while at the same time the EU sends a signal to international partners: Europe wants to help shape, not just watch.