
The Intelligence from The Economist Lowering the steaks: a Mercosur deal at last
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Jan 13, 2026 Christian Odendahl, Economics editor for Europe at The Economist, breaks down the newly inked EU-Mercosur trade deal, explaining its long-awaited conclusion and its implications for global trade. Moeka Iida, a journalist focusing on Japan, discusses the troubling rise of anti-foreigner sentiment and its roots in immigration and public sentiment. Meanwhile, Hamish Clayton shares the inspiring story of Parkrun in the UK, a community initiative that's helping boost public health through inclusivity and non-competitive running.
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Pair Deals With Targeted Safeguards
- The EU used a qualified majority vote and negotiated extra safeguards to pass the deal despite opposition.
- Odendahl implies policymakers should pair trade deals with targeted subsidies to win political approval.
Geopolitics Trumps GDP Gains
- Economically the growth effect is limited because current EU–Mercosur trade is small relative to other regions.
- Yet Odendahl argues geopolitical diversification and supply‑chain resilience are the pact's real value.
A Strategic Counter to US And China
- The deal counters US and Chinese trade strategies by strengthening Europe–Latin America ties.
- Odendahl frames it as a strategic response to rising economic coercion and protectionism.



