• Giorgia Meloni’s crucial pivot allowed the EU’s largest-ever trade agreement to finally pass.
• With €45 billion in EU commitments to Italy, Meloni eased domestic pressures while presenting herself as a constructive actor to the EU.
• The EU is seeking to establish itself as a stable market amid a changing world order, as the bloc scrambles to forge new trade alliances.

Why is Giorgia Meloni MILD?

Answer: Years after concluding talks, Meloni provided pivotal support, paving the way for the signing of the EU-Mercosur trade agreement.

On January 9, two years after negotiations ended, the European Commission secured a qualified majority to sign the EU-Mercosur trade agreement. With 20 EU member states supporting the deal, representing more than 55% of member states, Italian Prime Minister Giorgia Meloni’s support was pivotal in securing the two-thirds of the EU population needed to approve trade agreements, fulfilling the second ‘double-majority’ rule for EU legislation adoption.

To secure the qualified majority needed to sign the deal, the European Commission asked Italy to reconsider its opposition. In a letter to Meloni, European Commission President Ursula von der Leyen committed €45 billion in accelerated funding for farmers under the Common Agricultural Policy budget. 

With Italy and France originally opposing the deal due to domestic pressure from farmers, the additional funding from the European Commission helped alleviate concerns that had been holding Meloni back. This is the largest trade agreement in the EU’s history, creating a free trade area for 700 million people. The agreement centers on trade, political dialogue, and cooperation. It aims to eliminate 90% of tariffs, cut non-tariff barriers, and harmonize regulations.

Representing a quarter of global GDP, the EU will also increase its presence in Latin America, alongside the U.S. and China. However, while the deal will save the EU $4 billion in tariffs, it is projected to achieve only marginal growth of 0.1% by 2032. Still, the deal will help achieve one of Europe’s objectives: reducing its dependence on China for critical minerals and on exports to the U.S.

After signing the EU-Mercosur deal on January 21, the European Parliament, in a close vote of 334 to 324, with 11 abstentions, referred the deal to the Court of Justice of the European Union for validity assessment. While the referral will delay the deal by 18-24 months, the European Commission will provisionally apply the deal, which will take effect in May 2026. 

What is changing Meloni’s heat level?

Answer: Meloni secured important funding for farmers at home; however, farmers remained unsatisfied, leading to protests. 

Meloni postponed the signing of the trade agreement with Mercosur in December 2025 due to unresolved issues with domestic farmers and demanded additional time to address them. At a press conference on January 9, Meloni stated that Italy’s support for the Mercosur deal would not be at the expense of Italian farmers. 

In addition to the €45 billion in funding from the European Commission, Italy ensured the deployment of a safeguard mechanism for sensitive products and the reinforcement of equal sanitary requirements across both blocs. Despite these achievements, Italian farmers protested a few days after the deal’s signing, focusing on strained prices and increased competition from Mercosur. The farmers expressed concerns that the funds would be poorly allocated due to bureaucracy and that the deal lacks reciprocity.

Meloni has been repeatedly demonstrating pragmatic and strategic leadership at the EU level, securing key allies to advance her agenda. Unlike her 2019 campaign persona, which relied heavily on strong Eurosceptic sentiments, Meloni has since maintained a cooperative and pragmatic stance towards the EU. Her support for the EU has helped her establish important relationships, especially with von der Leyen, thereby helping Italy avoid severe sanctions for non-compliance with EU law. Instead, she leveraged her position in the Mercosur negotiations to secure additional funds from the EU, easing tensions with Italian farmers. 

What is driving Meloni? 

Answer: Meloni has shown herself to be a pragmatic leader at the European level while appeasing important domestic actors.

The support and relationships with her European counterparts are imperative to Meloni’s agenda, built on her core ideological pillars: God, family, and homeland. Her vision is to build a new majority in the European Parliament by supporting right-wing groups in Europe, especially the European Conservatives and Reformists, to isolate the left coalition. 

At home, Meloni has adopted a more radical far-right policy, passing a security decree that limits protests and strikes, and boosts police protection, increasing repression on controversial issues that face public criticism. Appeasing Italian farmers is vital to securing support from her electorate.

At the moment, Meloni enjoys an approval rating of 42%, placing her above several of her European counterparts. The Italian economy has seen improvements, with the public deficit reduced by 3% and unemployment at 6%. However, economic metrics show low GDP growth, declining wages, and stagnant industrial productivity.. 

The secured funds for farmers are crucial to Meloni’s government in countering opposition arguments. The Five Star Movement has openly criticized the Mercosur deal and the government’s unexpected support for it. The Green and Left alliance (AVS) denounced the hypocrisy within the government coalition of pursuing “food sovereignty” while accepting the deal. 

Nevertheless, the government coalition that Meloni enjoys in combination with her party, Brothers of Italy, The League, and Forza Italia, can grow awry if the prime minister’s party gains more popularity at the expense of the others. 

What does this mean for you?

Answer: The support from Meloni’s Italy showcases how the EU is resolving internal divisions as it seeks to form new trading relations amid a changing global order. 

Following the EU-Mercosur agreement, the EU and India agreed on a trade deal that will seek to reduce tariffs on EU exports by approximately €4 billion. Both sides aim to reduce or eliminate export duties by more than 95% over the next 7 years. This is crucial for the EU as its exports to India are valued at €75 billion and support more than 800,000 jobs. The trade agreement serves as a strategic response to the White House’s isolationist trend and aggressive U.S. tariffs. As India’s economy grows over 6% annually, the EU aims to strengthen ties, pending approval by the European Council and Parliament.