The long-awaited agreement comes amid the sweeping use of tariffs and trade threats by US President Donald Trump’s administration, which has sent countries scrambling for new partnerships.

Together, the EU and Mercosur account for 30 per cent of global GDP and more than 700 million consumers.

The treaty eliminates tariffs on more than 90 per cent of bilateral trade.

The deal will favour European exports of cars, wine and cheese, while making it easier for South American beef, poultry, sugar, rice, honey and soybeans to enter Europe.

The treaty between the EU and Mercosur nations Argentina, Brazil, Paraguay and Uruguay was agreed in Brussels last week despite fierce opposition from European farmers.