Europe is missing out on Latin America’s potential

Europe is missing out on Latin America’s potential

The second summit of Europe, Latin America and Carribean (EU-CELAC) nations is being held in Brussels. The 33 states from the Latin America and Caribbean regions - home to more than one billion people - have joined the EU-28 on June 10 and June 11, 2015, to discuss bi-regional and global issues. But these meetings never attract much attention, writes Prince Michael of Liechtenstein.

Yet Latin America is the EU’s fifth most important trading partner and European companies are the largest foreign investors.

Day one of the summit did see the European Union (EU) commit 118 million euros (US$133 million) in investment support for Latin American and Caribbean states.

But the tour of South America by China’s Prime Minister, Li Keqiang, in May attracted a lot more publicity. This was, however, likely due to the generous chequebook signing of 36 agreements with Brazil’s government alone, worth a potential US$53 billion.

But why is the European-Latin American relationship so unspectacular?

Yes, the Iberian countries - Spain and Portugal - have important relations with South America, but others do too. Europe and Latin America have strong cultural and economic ties - and there is huge additional potential.

Problems exist on both sides. The countries from Mexico down to the tip of Argentina are following diverse policies. Internally, they struggle with governance problems, corruption and unresolved economic and social issues.

They also have huge problems finding common denominators which hamper their economic collaboration at Mercosur - the sub-regional bloc comprising Argentina, Brazil, Paraguay, Uruguay and Venezuela. Its associate countries are Chile, Bolivia, Colombia, Ecuador and Peru.

Argentina 's President Cristina Kirchner chose not to go to Brussels. It would not have made sense, given her disastrously protectionist economic policy.

Also, Europe is deeply involved in its own economic and political problems. The potential of Latin America is therefore rather neglected in politics.

Latin America is a natural trade, cultural and political partner for Europe. Europe should not lose out to other influences.

Related reports:

China’s slowing economy could reduce FDI in Latin America

Latin America and EU trade summit falls short of expectations

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