The EU is looking to Latin America

The European Union has long recognised the need to maintain and rebuild partnerships with the Global South. It seeks to use trade as a deliverer of prosperity and as a tool of influence. Recent events have sped things up. The strengthened positions of China and Russia in those latitudes, Brexit in the UK, Europe’s desire to end its energy dependence on Russia after the invasion of Ukraine, and Biden’s energy protectionism are some examples. The Union is losing competitiveness in strategic and trading terms. 

Against this backdrop, many have great expectations for this week’s EU-CELAC (Community of Latin American and Caribbean States) meeting in Brussels. But the relationship between the EU and Latin America is not at its best in the lead-up to the long-awaited reunion. 

Many have great expectations for next week's EU-CELAC meeting – but the relationship between the EU and Latin America is not at its best

Beyond the delayed ratification (since 2019) of the EU-Mercosur agreement, the EU also cares about other strategic aspects of the matter. Latin America has substantial geographical advantages for developing renewable energy projects. For instance, Argentina, Brazil, and Chile have excellent conditions for generating aeolic power, critical to produce green hydrogen. Moreover, Argentina, Bolivia, and Chile boast rare elements widely used in the electromobility industry. Consequently, Latin America’s potential could improve the EU’s energy supply while allowing it to develop its electromobility sector. 

Credibility crisis

The problem is that the EU has lost credibility in the Global South. This is especially visible in Brazil. Some argue that its approach is colonial and paternalistic. Others maintain the EU is hypocritical to demand high environmental standards from its partners while not doing enough, in partners' eyes, to reduce emissions at home. European Commissioner Von der Leyen’s recent visit to Brazil illustrates this point. 

The EU has lost credibility in the Global South, and is perceived as colonial, paternalistic, or hypocritical

Von der Leyen aimed to deploy EU priorities in the region. One of those is the trade agreement with Mercosur. Unfortunately, things did not go as the EU expected. Brazil's President Lula da Silva claimed, 'The premise between partners should be mutual trust, not distrust.' His statement is a reaction to the so-called additional instrument the EU wants added to the EU-Mercosur agreement. The instrument emphasises the parties' environmental commitments nationally and under the Paris agreement.

Rumours of a sanctions mechanism

Brazilian media presents the additional instrument as a sanction mechanism. A leaked version of the additional instrument, however, shows that there is in fact no sanction mechanism within it. Certain misunderstandings still prevail in Brazilian media about this. Still, the more important takeaway is that the EU’s request for this instrument is interpreted as a lack of trust. Lula’s comment hence demonstrates effectively that the EU’s insistence on additional rules-based commitments before ratifying the EU-Mercosur agreement weakens trust between the partners.

Another recent hiccup has emerged from the EU’s new deforestation regulation. The regulation requires that commodities associated with deforestation must be proven deforestation-free before entering the European market. Some say it is a major boon to global efforts to stop deforestation. Others hold that it is too demanding, and fear the economic consequences. The EU presents the regulation as a tool to help Brazil and other countries meet climate targets by shutting down a market for commodities associated with deforestation. But in Brazil, by contrast, the regulation is perceived as an unnecessary imposition and, by some, even as discriminatory. 

Support for Ukraine

Lula’s changing stance regarding the Russian invasion of Ukraine also challenges the EU-Brazil partnership. The President suggests that Brazil could take the lead in peace negotiations between Ukraine and Russia. Lula also promotes regional currencies to compete with the US dollar and bypass US sanctions against Putin. Recall that his Brazil is Back is not only about the Brazilian economy but about leading a stronger Global South in the world, starting with the BRICS: Brazil, Russia, India, China, and South Africa.

So far, the EU has struggled to build a strategic partnership, and seems not to listen to Latin American perspectives

So far, rather than building a strategic partnership with Latin America, the EU is proving its critics right. Its focus is primarily on what the EU wants from the partnership. In addition to new environmental standards, EU representatives seek to get Latin American governments to support the EU regarding its condemnation of Russia’s invasion of Ukraine. Despite those efforts, no democracy in the region has agreed to send Ukraine weapons to fight Putin’s military.  

The way forward

The imminent EU-CELAC meeting is a viable opportunity for the EU start listening to what Latin America wants from the partnership. A good example to follow is the European effort to promote Chile’s green hydrogen production in the Magallanes region of Patagonia.

While the EU has been criticised for seeking to secure and gain economic control over Chile's massive lithium stocks, the project in Magallanes is different. There are several points to highlight. Firstly, it has been a public-private undertaking, in line with current development narratives. Italian, German, French, and Austrian firms involved have actively engaged in dialogue with central government authorities. They have focused even more on engaging local authorities and citizens of this region of 165,000 people at the end of the world. Second, the project has offered what citizens and authorities in the region care about the most: good jobs and training to fill the positions. 

The macro-narrative is about providing Europe, through Rotterdam, with clean and safe energy over the next 30 years while enhancing the economic capacity of Chile and the Magallanes Region. The micro-narrative is about educational alliances, improving the position of local educational institutions, and creating employment for the region’s youth. 

If the EU wants to build a strategic partnership with Latin America and the Caribbean, it needs to tone down the paternalistic narrative, and acknowledge local actors’ needs and aspirations.

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