Four routes to a strategic relationship
2023 will be a key year in relaunching the relationship between the European Union and Latin America. There are many factors that should encourage a greater closeness between the two regions. Among those factors are the Spanish Presidency of the Council of the EU, the need to accelerate the energy transition and the fight against climate change, as well as the search for reliable partners in the defense of democracy, human rights and the principles enshrined in the UN Charter.
Under these circumstances, the primary challenge lies in determining how to leverage the underlying elements as a base for a strategic relationship that extends beyond the short term. This is no easy challenge and there is no one right answer. On the road to a strategic relationship, there are four necessary paths, each one posing unavoidable obstacles.
The first path is political. Regular meetings between the different parties are an essential part of a healthy relationship. The eight years since the last EU-CELAC Summit serve both to demonstrate and cause the deterioration of ties between the two sides. The Summit to be held in July is an important sign of the willingness of both parties to address this situation. However, it is not enough to merely hold a Ssummit; it is crucial to agree on an agenda that continues the work we have begun and enables future deepening of the relationship. Progress has already been made in this regard, at least at an Ibero-American level, with important agreements reached on matters such as digitalization, the environment and food safety. These factors are key to regional development and could well serve as the basis for a bi-regional agenda for fostering future strategic convergence.
Progress has already been made, at least at an Ibero-American level, with important agreements reached on matters such as digitalization, the environment and food safety. These factors are key to regional development
The second path is commercial, where we also have substantial foundations to build on. Latin America and the Caribbean is the region with the most extensive network of formal agreements with the European Union; the EU being the region’s third largest trading partner. The challenge here, as highlighted by the High Representative of the European Union, Josep Borrell, at the Ibero-American Summit in Santo Domingo, is demonstrating that the commercial relationship can continue to be a source of progress and that it is in the interest of both parties to encourage the completion of outstanding agreements.
The third path is cooperation. The EU is the leading donor of official development aid to Latin America and the Caribbean. However, it is crucial to advance toward more flexible cooperation that can evolve and adapt to new challenges faced by countries in the region and continue to support them on their path to development. There are a number of measures that could reinforce cooperation in the construction of the bi-regional strategic relationship, including strengthening European participation in triangular cooperation initiatives, incorporating new stakeholders and expanding the scope of cooperation. This is necessary to promote investment in key areas of regional development such as infrastructure, digitalization and energy transition.
Europe is currently the biggest investor in Latin America and the Caribbean, with investments exceeding those made in Russia, China, India and Japan. However, there has been a decrease in funding in recent years
The fourth and final path is investment. It is essential to restore growth in order to overcome the major challenges facing the region, which requires investment. Europe is currently the biggest investor in Latin America and the Caribbean, with investments exceeding those made in Russia, China, India and Japan. However, there has been a decrease in funding in recent years. It is hoped that a new investment agenda, within the Global Gateway framework being prepared by the European Commission, will promote high-quality investment and encourage the transfer of technologies and knowledge to ultimately assuage fears of a new extractivist cycle. In any case, for these measures to be successful, we must secure the support, trust and commitment of businesspeople, who must in turn demonstrate that they are part of the solution and not the problem.
Current conditions are ideal for the establishment of a deep and long-term relationship between Latin America and the Caribbean and the European Union. This presents both a major opportunity and a significant need for both regions—relaunching a more intense, horizontal and substantial bilateral relationship. Failure is not an option.