About the SIA Study
This SIA in support of the EU-Mercosur Association Agreement negotiations is implemented by LSE Consulting, the consulting arm of the London School of Economics and Political Science. Specializing in economic analysis, analysis of sustainability issues, as well as sectoral analyses, the LSE Consulting team has extensive expertise in fields related to the assessment, including a deep understanding of the regional specificities of Mercosur.
FTAs are expected to have effects beyond those directly related to trade, for example, fiscal effects associated to the loss of tariff revenue and increases from VAT. The team uses CGE modeling to assess fluctuations in consumer impacts, SME impacts, welfare changes, prices, production, consumption, investment, employment, and income.
Regardless the total economic, social or environmental impact of the AA, there might be some sectors where either the impact may be in the opposite direction than the overall analysis or that the impact may be of particular strength. The team will make a comprehensive assessment of the effects of the AA in ten selected sectors.
EU trade policy has become one of the main pillars of the EU’s external action to promote ILO standards, whether at the unilateral, bilateral/regional or multilateral levels. Assessing job creation and wage differentials across five labour categories and in different sectors, the team will combine quantitative and qualitative analysis to assess potential effects on a range of social indicators, including inequality, poverty, and informal employment among others.
The team proposes to analyse the scale, structural, technology and product effects of an EU-Mercosur AA in terms of both welfare and GHG emissions in CO2 equivalent. Specifically, the team will focus on effects associated with climate change; energy use; land use; resource use and efficiency; waste production; ecosystems and biodiversity; and trade in environmental goods and services.
Human Rights Analysis
Human rights implication of FTAs have long been a topic of interest, and are of special relevance to the SDGs. The team proposes to assess fluctuations estimated by the CGE modeling from a human rights based approach, discussing potential risks or progress towards the fulfillment of relevant human rights obligations. Specifically, the team will combine quantitative and qualitative analysis to assess potential effects on risk areas including rights of women and indigenous populations among others.