Andrés Allamand: “Latin America needs Europe to compete with China”

The world is immersed in a time of great change, in which international balances have been broken and new challenges and geopolitical tensions have emerged. China is the new great global player: it has spread its tentacles through investments and is the protagonist of a trade war with the United States that is wreaking havoc everywhere. Europe, on the other hand, has lost relevance. But the board is moving. “I am convinced that we are in a very important, positive moment, of a relaunch of relations between Latin America and Europe,” said Andrés Allamand, Ibero-American Secretary General (Segib) this Tuesday. In this renewed approach there are countless business, economic and strategic opportunities. “Latin America does not want to be gripped by the struggle between the United States and China,” the former Chilean minister concluded during a lunch organized in Madrid by the Business Council Alliance for Ibero-America (Ceapi), so the entry of a third actor would open ” enormous opportunities.”

Although the European Union continues to be the leading investor and third trading partner in the Latin American region, in recent years it has been displaced by Beijing, which has become very strong on the continent. First, promoting commercial activities; and later, through huge capital injections with a long-term vocation that have turned the Asian country into the leading investor in the region. “Europe must have a more active presence. “Latin America needs Europe to compete with China,” Allamand insisted during the event, held in the offices of the Gómez-Acebo & Pombo law firm after the meeting of the board of directors of the business organization.

The Spanish presidency of the EU, according to the lawyer, has been a turning point in the unblocking of the relationship between the two sides of the Atlantic. In this sense, Allamand has referred to the recent EU-CELAC (European Union-Community of Latin American and Caribbean States) Summit, held in Brussels and which has provided a diplomatic boost after years of disagreements. “I was left with two sentences. The first is from (the president of the European Commission) Ursula Von der Leyen, who said the following: ‘Europe aspires to be the preferred partner of Latin America and the Caribbean.’ President (of Brazil, Luiz Inácio) Lula said: ‘With my long experience in international affairs, I have never seen so much European interest in Latin America as I am seeing now,’ Allamand noted.

Pending tasks

The EU-Mercosur trade pact, which according to the Ibero-American Secretary General would generate “particularly positive flows for both parties”, has nevertheless been negotiated for 20 years without success. “Frankly, I think it needs a political push,” Allamand said. In his opinion, we must take advantage of an international order that is being reconfigured, taking advantage of the large areas of convergence that exist between Europe and Latin America: “There is no doubt that the two most similar, most compatible regions that one can find in the world , are precisely Europe and Latin America.” The relationship could be a winner for both sides of the Atlantic: the Old Continent would expand its international influence and many Latin American economies would obtain an international projection that they do not have now, the lawyer has argued.

“Latin America needs financing, technology, investments and knowledge that Europe can provide, but not to start a new extractivist stage,” said the former Chilean minister. “It is not just about exporting natural wealth, but we must add value” and promote the growth of a region that is advancing at a less intense pace than it would need.

In this sense, he has recognized that Latin America also has pending tasks. The major issues to be met refer to political instability, which represents a deterioration in the continent’s governability, and the lack of trust in institutions, which implies high costs when it comes to attracting investments. Finally, Allamand added that the economies of the region must improve their entrepreneurial and business environment, emphasizing legal certainty: “If there are no judicial, arbitration or any mechanism to resolve conflicts expeditiously, that becomes in an obstacle for investments and businesses.”

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