"Italy's Giorgia Meloni said 'common sense prevailed' after the EU ditched controversial plans to use frozen Russian assets for a 'reparations loan' for Ukraine, following 15 hours of talks on Thursday night. "I am glad that common sense has prevailed, that they managed to secure the necessary resources but did so with a solution that has a solid base on the legal and financial levels," she said. She also backed plans to postpone the Mercosur summit - after huge protests from farmers across the bloc. The EU's prospective deal with the South American bloc has seen a huge backlash from European farmers concerned about price-undercutting, claiming 'higher' standards on their side will affect competitiveness - and warning of a market 'flooded' with cheap produce. European Commission President Ursula von der Leyen is set to be in Brazil for the official signing on Saturday, while France and Italy have called delays. Brazil's Lula da Silva called on Meloni and France's Emmanuel Macron to get behind the trade deal - saying it was 'now or never' - with South American leaders insisting the deal is good news for both sides and will allow key EU exports to their countries too. Crunch talks between European leaders in Brussels saw them fail to agree on the keynote plan pushed by the European Commission to use frozen Russian assets for a $140bn 'reparations loan' for Ukraine. The alternative - a smaller $90bn loan over two years backed by the EU budget - needed a unanimous decision, with Hungary, Slovakia and the Czech Republic only agreeing to approve it on the proviso that they did not have to contribute. On the failed Russian frozen assets proposal, Belgium’s PM Bart De Wever said: "When we explained the text again, there were so many questions that I said, ‘I told you so, I told you so.’ There are a lot of loose ends. And if you start pulling at the loose ends in the strings, the thing collapses." Belgium - where the assets are held - and others warned of the impact on investor confidence, the need for 'risk-sharing' if Russia won a subsequent lawsuit, and questioned the legality. Italy, Belgium, Malta and Bulgaria called for alternatives to be explored, while others like Hungary and Slovakia have highlighted the need to end the Ukraine conflict - rather than fund more weapons- as well as ongoing corruption scandals in Ukraine. Russia condemned the frozen assets plan as 'illegal' and 'theft'. "