TO THE SEARCH OF NEW MODELS? FROM DEPENDENCY TO INTERDEPENDENCY.

Europe and Latin America

From colonization to independence

Latin America’s incorporation to the world-the beginning of subordination and plunder of resources

Colonial relationships: race and ethnicity, the other/inferiority/imitation

Economic dependency political and cultural dependency

Independence-neocolonialism

70-80s: a new profile

70s-multipolarism and détènte: Social democracy as a new alternative searching for new partners and influence among political parties in LA

Inter-parlamentarian contacts and regular meetings

80s-bipolarisation in Central America searching for a mediation role France, Germany and Sweden

Central America: a test for multi-polarity

1981 Resolution Mexico-France on El Salv1982-Nicaragua- assistance offers from

Europenegative reactions from the USEC gives in and goes back to a low profile

Contadora group’s support to peaceful solutions

Falklands-re-polarization-EC+ US vs LASn Jose’s process- support to Arias Plan

Rio’s dialogue since 1990

Political dialogue between two continents Development of differentiated relations

following regional groups, development levels and political/economic interests

3rd generation agreements: conditionality clauses on democracy, human rights and structural economic reforms

Neo-liberalization and the end of alternatives?

Sub-regional differentiated treatment: 90s

Andean group –preferential agreements and cooperation projects demands of strategies to fight coca production

Central America: development assistance, framing small/middle peasant production-marked orientated networks of support

Mercosur – frame agreements and direct support to regional economic integration cooperation and open path for free trade

Privileged relations

Mexico: Economic partnership, political coordination and cooperation agreement, FTA entered into force 2000.

Chile: Association Agreement 2002-entered into force 2005towards a free trade area

The survival of colonial links: bi-continental summits

following Spain and Portugal’s presidencies

Rio 1999-strategic association and Action plan Madrid 2002- to increase cooperation in 3 areas: hum.r.,

promotion of the information society and struggle against poverty

Main goal-human developm and the strengthening of civil society Guadalajara 2004: intensifying the struggle against drugs,

agreements on reg cooperation Lima maj 2008, May 2010 in Madrid “Towards a new stage in the bi-regional

partnership: Innovation and Technology for sustainable development and social inclusion”

Jan 2013: EU-CELAC meeting in Santiago, Chile: Alliance for Sustainable Development to Promote Investments of Social and Environmental Quality

Madrid May 17-18, 2010

LAC: very divided politically/ideologicallyHonduras as a divider: boycott (UNASUR),

but also the Cuban issueFinally Venezuela and UNASUR attended, not

Honduras (only to the CA-UE summit: May 19)

What happened with the strategic alliance project of 1999?

Civil society

Civil society’s organizations- NGOs-following already existing trade agreements: Europe-Mexico-1st meeting Brussels-2002, Mexico 2005, Vienna 2006: discussion, reports and accountability

EU-Andean countries-NGOs forum-March 2005-Brussels

In all summits: parallel NGOs meetings

TradeEU- second regional associate of LA after

the US but losing importance to China in South America

2011: 214 bill euros: 6,5% of EU’s total trade

Effects of EC-EU’s enlargement on EU-LA’s relations

Exchange structure: typical developed-developing countries (industrialized products vs raw materials) with the exception EU-Mexico

LA’s share in EUs imports (percent)

1965 1970 1980 1990 2004

world 100 100 100 100 100

Within EC-EU

46 51 57 61 30.9

LA 5.3 4.2 2.9 2.1 5.2

LA’s share in EU’s exports (percent)

1965 1985 1990 2004

LA 6.4 4.1 2 3.6

Total 100 100 100 100

2009: EU’s trade with LAC

EU-LA trade up to 2012

EU’s imports and exports: origin and destination 2004

(percent)Partner regions imports exports

NAFTA 58.8 89.4

Latin America 5.2 3.6

EU candidates 0.1 0.0

EFTA 0.5 0.1

Medit countries 0.3 0.1

ASEAN 4.2 0.2

LA: exports structure

1990 1999

Raw materials +energy

43% 23%

manufactures 57% 64%

EU’s imports and Mercosur

Raw materials + energy (in % of all imports):1965: 45 % 1990: 24%

1995: 55% of all Mercosur’s exports to EU raw materials and energy

2005: 21.2%

EU-Mercosur

1995: Frame-agreement of cooperation and association starts to be negotiated

1999: Free trade agreement negotiations startgoal 2006

Association agreement: 2001: 3 pilars: MNC/polit/trade

Assistance/consultancy –for regional integration

EU interested in telecommunication and financial services

Obstacles for FTA: EU’s CAP but advances since Cancun

EU-Trade with Mercosur

EU imports from Mercosur

EU exports to Mercosur

EU trade with Chile

EU-Chile

EU: Chiles biggest trade partner and biggest investor

Chile exports mainly minerals and agrifood sectors

Also liberalization in service sectors

The EU and the Andean countries

Political dialogue and cooperation agreement: 2003

EU: leading donor of official development aid to the Andean region, with €713 million set aside

June 2007: negotiations began on a new Association Agreement bi-regional trade and investment

Political Dialogue and cooperation agreements

A very broad program of cooperation at the economic, political, social level focusing strategically on the fighting of drugs production and traffic

Also: providing aid for e deepening of the integration process within Andean countries

Problems towards assoc agreements

June 2007: negotiations began on a new Association Agreement

Several round negotiations (3) but the 4th round to take place in Brussels in July 2008: suspended

Problem: agreements around intellectual property, privatization of public services and state licitations

Problems-negotiations with EU

Division among Andean states: Colombia and Peru-for bilateral agreements, Ecuador y Bolivia: bloc negotiations and agreements

Official announcement-mid nov: Colombia and Peru continue the negotiations on their own, Ecuador wants to follow

Bolivia is isolated-insists on bloc negotiatBolivia also enters bilateral negotiations

EU trade with the Andean community

EU exports to Andean Community

EU imports from the Andean C.

EU-Central America

A relation based on development cooperation in the 1980s-1990s

Upgrade to a trade relation: negotiations for an Association agreement

Problems in the negotiations: quotas, the entrance of European milk’s products, rules of origin for CA’s textiles, banana’s entrance to the EU plus migration issues

Signed is spite of all in Madrid May 2010

EU-CA 2006-2008

CA-EU

EU-México: FTA in 2000

Signed in 1997- starts in 2000 Elimin tariffs -48% for all ind product fr EU, 82%

for all Mex products to EUGoals: elimin of all tariffs for ind prod 2007No visible results in trade exchanges-stagnated

and big deficits for MexicoInvestmentsrules rejected for MAI accepted by

Mexico (already-privatized banling system-mainly European investments

EU-Mex-FTA: a door for EUs products to the US (NAFTA)

Clause of democracy and HR-difficult to accept for Mexico

EU’s trade with Mexico

Year Imports: % of tot

Export: % of tot

2001 0.78 1.71

2002 0.69 1.70

2003 0.69 1.64

2004 0.67 1.52

2005 0.76 1.58

Mexico’s trade with EU

Year EU share of tot imports %

EU share of tot exports %

2000 8.27 3.30

2001 9.34 3.19

2002 9.50 3.19

2003 10.16 3.55

2004 10.06 3.18

EU trade with Mexico

EUs import from Mexico

EUs exports to Mexico

EU’s investments in LA: the crucial pillar

Investments FDI to LA: increase during the 90smostly privatized industries: energy/telecommunications, banks, trade:

tot: 385 bill in 2010: 43% of the region’s FDI and higher than EU’s investm in Russia+China+India combined

Latest summit: investment is the crucial pillar of the relationship EU-LA

FDI fr EU concentrates on Mercosur (recently also Mexico)

EU’s investments in LA by country:Spain: 28% (55% of all Spanish investm outside EU)GB: 22%, France: 13%; Germany: 14% (45% of German

investments in developing countries), Holland: 14%, Belgium: 3%, Italy: 2%, Sweden: 1,3%

EU’s investments in LA: 2

EU: the biggest extern investor in LA (decade 2000: 40%):

2011: US (18%), Spain (14%) y Japan (8%). China: 5,2%

Flows of European FDI to Latin America peaked in 2000 (€ 46 billion), with the total stock of European investment in Latin America growing from € 189.4 billion in 2000 to € 385 bill in 2010 2

Investments concentrated in Mercosur and México

Investments-where?

2011: 57% FDI in South America (without Br): in agriculture, mining and energy, services: 36%, manufactures: 7%.

Brasil: 43,8% of all FDI in LA. Manufactures 46,4%; services: 44,3%, raw materials and extractive ind 9,2%

México, CA and Caribbean: services: 52,5%; manufactures: 39,7%, natural resources: 7,8%

81% of all FDI: Brasil, México, Chile, Colombia and Peru

EU: Assistance Aid to LA

LA not a priority area for EU mid 90s: only 10% of all EU development aid but it was 43% of all external aid to the region in 1995 (17% came from the USA)

Aid concentrated on Central America and Bolivia

Focusing on economic reforms, support to public infrastructure: to make the local governments more effective, in democracy, human rights issues and struggle against poverty.

A case of aid: Sweden-LA

Sweden: 2002: less than 10% of all bilateral aid: to LA

Aid: mostly to Central America (Nicaragua and El Salvador-peace, reconciliation, economy rehabilitation, democratisation-this has changed lately-abandoning CA)

South America: Bolivia, Chile, Brazil-democratisation, economic reforms, human rights and technical education

The main areas: health, education, human rights

Civil Society and aid in the case of Sweden

Swedish NGOs channel 20 % of all bilateral aidBoth secular and religious NGOsFocusing more and more on long term projectsMain financing sources the state (80%) but

their own financing is also increasingCooperation partners: local NGOs and

sometimes: state organsSome NGOs have local offices and send their

own assistance volunteers: Svalorna, Civis

EU-LA: an inconsistent relationship?

Priorities for EU: Economic investment, trade, assistance

Priorities for LA- trade-specially Mercosur, investments –specially Mexico

Trade is becoming balanced but it has lately been a deficit for EU and is still insignificant for EU-therefore: interest in Association agreements and FTAs

Extreme interest in LA’s nature resources-competition with China

EU-sometimes an alternative (HR and democracy clauses) but mostly a contradictory-inconsistent partner EU’s policies subordinated to the US, to CAP and complicated by enlargement

Asymmetry problems extremely present although LA’s dependency is even bigger from the US