THE EU AND MERCOSUR BEGIN THE PRACTICAL IMPLEMENTATION OF THEIR TRADE AGREEMENT (5 May 2026)
On 1 May 2026, the Association Agreement between the European Union and Mercosur provisionally entered into force, thus bringing to a close one of the most extensive and complex trade negotiation processes of recent decades. The agreement creates an integrated economic area covering more than 700 million consumers and provides for the progressive liberalisation of a substantial part of bilateral trade in goods and services. Among its main effects are the gradual elimination of tariffs on European industrial products, the expansion of preferential access for South American agricultural products to the EU market, and the partial harmonisation of certain regulatory, customs and trade standards.
During the first few weeks of implementation, its practical effects began to unfold in areas such as rules of origin, tariff quotas, certifications, logistical adaptation and the contractual reorganisation of economic operators. Exporting and importing companies from both blocs began reviewing their supply chains, distribution structures and tax strategies with the aim of maximising the benefits derived from the new preferential framework.
However, the initial implementation of the agreement has begun to generate tensions in both blocs. In Europe, political and economic concerns persist regarding agri-food competition, environmental sustainability and the traceability of certain products from Latin America. Meanwhile, within Mercosur, the allocation of export quotas with preferential access to the European market has been questioned, particularly in agricultural sectors such as rice, honey, eggs and certain meat products.
TRADE TENSIONS BETWEEN THE UNITED STATES AND CHINA IN THE TECHNOLOGY SECTOR PERSIST (7 May 2026)
The United States and China continue to impose trade and technology restrictions in the sectors of artificial intelligence, advanced semiconductors, high-performance computing and critical minerals. Whilst Washington maintains severe restrictions on the export of certain chips and advanced technologies to Chinese companies, Beijing has chosen to continue tightening controls on exports of rare earths and other minerals essential to the global technology industry.
This scenario is forcing numerous multinational operators to rethink their investment structures, supply chains and industrial localisation strategies, particularly in sectors highly dependent on advanced technological components. Furthermore, the progressive tightening of trade restrictions between the two powers is significantly increasing regulatory, compliance and geopolitical exposure risks for companies with cross-border operations.
Despite the persistence of these trade and technological tensions, both powers have sought to keep certain diplomatic and institutional channels open. In particular, on 7 May, Chinese Foreign Minister Wang Yi described bilateral relations with the United States as ‘stable’ during an official visit to China by a delegation of US senators, in what constitutes one of the first high-level political contacts since the start of Donald Trump’s second presidential term.
THE WTO PROMOTES THE MODERNISATION OF RULES OF ORIGIN AS A KEY INSTRUMENT FOR FACILITATING INTERNATIONAL TRADE (11 May 2026)
In May, the World Trade Organisation (WTO) stepped up its efforts to enhance the transparency, simplification and modernisation of rules of origin through a new meeting of the Committee on Rules of Origin, held on 11 and 12 May 2026. Members examined various initiatives aimed at reducing administrative burdens, increasing legal certainty for economic operators and improving consistency and interoperability between customs procedures and trade facilitation instruments.
Rules of origin are an essential element of international trade law, insofar as they enable the economic origin of goods to be determined in accordance with legally established criteria. Their correct application is crucial for access to tariff preferences under trade agreements, the adoption of trade defence measures (e.g. anti-dumping measures) or the application of safeguards.
Among the main areas of discussion was the need to move towards more streamlined, uniform systems for the certification and verification of origin, supported by digital solutions. In this regard, Members examined instruments such as the digitisation of documentation, self-certification systems, advance rulings on origin, and the simplification of means of proof, with the aim of reducing compliance costs and increasing predictability in trade operations. It was also highlighted that the excessive complexity of certain rules of origin may, in practice, constitute an indirect restriction on trade.
Finally, the meeting highlighted the growing interconnection between rules of origin and the resilience of global supply chains. In the current trade environment, marked by geopolitical tensions, the relocation of production and the increased prominence of strategic trade policies, these rules have gained significance beyond the customs sphere, as they now play a key role in industrial policy, technology control and risk management within the global economic context.
https://www.wto.org/english/news_e/news26_e/roi_11may26_388_e.htm
THE EUROPEAN COMMISSION PRESENTS AN ACTION PLAN TO STRENGTHEN THE EU’S FERTILISER SUPPLY AND FOOD SECURITY (19 May 2026)
On 19 May, the European Commission presented a new Fertiliser Action Plan aimed at strengthening supply and food security, as well as reducing the EU’s dependence on imports from third countries.
The plan combines immediate measures to ensure the availability and affordability of fertilisers, alongside medium- and long-term actions aimed at strengthening European industrial capacity and moving towards more sustainable models. Key priorities include boosting production within the EU, developing fertilisers with a lower climate impact, strengthening supply chains and supporting circular economy solutions.
From a strategic perspective, Brussels seeks to reduce the sector’s vulnerability to risks arising from its dependence on natural gas and critical raw materials, factors closely linked to international instability. Furthermore, the Commission emphasises the need to address food security and the climate transition jointly, against a backdrop of inflationary pressure and growing global competition for strategic resources.
UNCTAD WARNS OF RISING GEOPOLITICAL RISKS AND A SLOWDOWN IN GLOBAL TRADE (19 May 2026)
The United Nations Conference on Trade and Development (UNCTAD) has warned of the progressive deterioration of the international economic and trade environment as a result of rising geopolitical tensions, financial volatility and disruptions in global supply chains. In its report Trade and Development Foresights 2026: Global economy faces a geopolitical challenge, the organisation warns that the global economy is shifting from a phase marked by inflation and logistical disruptions towards a more fragile scenario of uncertainty.
According to UNCTAD’s forecasts, global economic growth could slow from 2.9% in 2025 to 2.6% in 2026, mainly due to rising energy prices, disruptions to maritime transport, financial market volatility and a decline in investor confidence. It also identifies a shift in the main focus of global risk towards geopolitical risks as the primary source of international economic instability.
The report also highlights that the apparent resilience of international trade observed during 2025 was driven mainly by sectors linked to artificial intelligence, particularly semiconductors, servers and data processing equipment. However, outside these technology segments, global trade growth shows a considerably sharper slowdown, particularly in traditional industries and sectors related to raw materials.
Developing economies appear particularly vulnerable in this scenario. Rising energy, food and fertiliser costs, coupled with tighter financing conditions and exchange rate volatility, are significantly increasing the pressure on many emerging economies.
Finally, UNCTAD stresses the need to strengthen international cooperation, stabilise the regulatory framework for international trade and accelerate investment in clean energy and infrastructure as essential mechanisms for reducing global exposure to future geopolitical and financial crises.
https://unctad.org/news/global-economy-faces-new-test-trade-food-and-finance-shocks-spread
THE EUROPEAN UNION APPROVES THE TARIFF AGREEMENT WITH THE UNITED STATES (20 May 2026)
The Member States of the European Union and the European Parliament reached an agreement on 20 May to implement the trade agreement signed with the United States in July 2025. The so-called Turnberry Agreement, originally signed by US President Donald Trump and European Commission President Ursula von der Leyen, provides for the elimination of customs duties on most US industrial goods imported into the European Union, as well as the application of a base tariff of 15% on numerous European products exported to the US market.
This agreement also incorporates significant economic and strategic commitments on the part of the European Union, including investments estimated at $600 billion in strategic US sectors by 2028 and large-scale purchases of energy from the United States. Brussels has defended the pact as a necessary instrument to preserve the stability of transatlantic economic relations and prevent a further escalation of tariffs that could seriously affect strategic sectors of the European economy.
The agreement’s approval came after several months of institutional deadlock and complex internal negotiations within the European Union. Various European parliamentary groups had temporarily suspended the agreement’s progress due to repeated tariff threats made by the Trump administration, particularly regarding the European automotive sector, as well as the general deterioration of transatlantic relations in areas related to foreign policy, energy and the conflicts in Ukraine and Iran.
Despite the political breakthrough that has been achieved, there remains significant concern within the European Union regarding the future stability and predictability of the trade relationship. European institutions and EU industrial sectors fear that the US administration will continue to use tariffs as a means of exerting political pressure in areas unrelated to international trade, such as the automotive, technology and defence sectors.
THE SPANISH CONFECTIONERY SECTOR CONSOLIDATES ITS GROWTH IN 2025 WITH OVER €2.65 BILLION IN INTERNATIONAL SALES (21 May 2026)
The Spanish confectionery industry closed 2025 with an export volume of €2.658 billion, representing growth of 9.75% compared to the previous year, according to the Informe de Comercio Exterior 2025 (2025 Foreign Trade Report) produced by the Spanish Confectionery Association (Produlce).
This progress reinforces the food industry’s position as one of the sectors with the greatest international reach within Spanish foreign trade. The sector’s positive performance comes, moreover, against a particularly challenging global backdrop, marked by increasing regulatory complexity in areas such as food safety, sustainability, labelling, traceability and compliance with environmental standards.
Notable among the exported products are chocolate and cocoa derivatives, biscuits, sweets, and industrial pastries and cakes. The report also highlights the progressive geographical diversification of exports, with a consolidated presence in the European Union and significant growth in markets in Latin America, the Middle East and certain Asian countries.
SEVILLE (SPAIN) STRENGTHENS ITS POSITION AS AN INTERNATIONAL AEROSPACE AND DEFENCE HUB (21 May 2026)
The Spanish city of Seville has consolidated its role as one of southern Europe’s leading aerospace and defence hubs following the eighth edition of the city’s largest sector-specific forum, which concluded with record attendance figures and significant strategic announcements for the industry.
The event brought together 415 companies, 29.7% more than in the previous edition, with a notable international presence, thus establishing itself as a key platform for business cooperation and the generation of business opportunities among manufacturers, industrial operators and support companies in the aeronautical, space and defence sectors.
Among the most significant announcements was Airbus’s decision to establish a new conversion centre in Seville for the A330 MRTT (Multi-Role Tanker Transport), a multi-purpose aircraft designed for in-flight refuelling, strategic transport and medical evacuation missions. Meanwhile, the Spanish firm Sofitec announced a strategic agreement with Turkish Aerospace Industries (TAI) for the manufacture of components for Boeing programmes.
These developments are also expected to have a significant knock-on effect on the supply industry, particularly in areas such as advanced engineering, component manufacturing, aircraft maintenance, industrial logistics and specialised technology services.
MEXICO AND THE EUROPEAN UNION UPDATE THEIR TRADE RELATIONSHIP (22 May 2026)
In May, Mexico and the European Union consolidated a new framework for economic and trade cooperation aimed at modernising the agreement in force since the early 2000s. The new instrument incorporates advanced provisions on digital trade, sustainability, investment protection, public procurement and regulatory cooperation.
The agreement responds to both parties’ need to diversify markets and reduce strategic vulnerabilities arising from growing global geopolitical uncertainty. For the EU, Mexico represents a key industrial and logistics hub within North America, whilst for Mexico, strengthening ties with this region is an essential tool for balancing its high trade dependence on the United States.
CHINA REMOVES TARIFFS ON 53 AFRICAN COUNTRIES AND STRENGTHENS ITS TRADE INFLUENCE AGAINST THE UNITED STATES (24 May 2026)
China has stepped up its trade and geopolitical strategy in Africa by effectively implementing a zero-tariff regime for imports from 53 of the 54 African countries with which it maintains diplomatic relations. The measure, in force since 1 May, represents one of the most significant trade developments of the year on the African continent and is widely interpreted as a strategic response to the tightening of US tariff policy.
The new scheme allows a wide range of African products, including agricultural goods, wine, wool, sesame, coffee and cocoa, to enter the Chinese market duty-free. The only exception is Eswatini (formerly Swaziland), a country that has historically preferred to maintain diplomatic relations with Taiwan. The initiative also extends the preferential system previously applied only to 33 African countries considered less developed, and now incorporates major regional economies such as South Africa, Nigeria, Kenya, Egypt and Algeria.
The measure reflects Beijing’s interest in consolidating its position as the African continent’s main economic and trading partner at a time of strategic rivalry with Washington. The context is particularly relevant following the imposition of new US tariffs on certain African products and the uncertainty surrounding the future of US preferential mechanisms such as the African Growth and Opportunity Act (AGOA).
However, it is important to highlight the structural limitations of Sino-African trade, as significant non-tariff barriers persist, linked to phytosanitary requirements, logistical constraints, infrastructure deficits and limited industrial capacity in many African countries; as well as a marked trade imbalance between the two regions, characterised mainly by African exports of raw materials and imports of Chinese manufactured goods.
https://www.wsj.com/world/africa/china-africa-tariffs-664f62eb
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In Madrid, 31 May 2026
International Trade and Sanctions Department
Lupicinio International Law Firm
