Latin America–European Union relations in the twenty-first century

Arantza Gomez Arana, María J. García, Arantza Gomez Arana, María J. García

• Publisher: Manchester University Press
• Year: 2022
• ISBN:
  9781526136510
• Topic: Politique et relations internationales
• Subtopic: Relations internationales

Latin America–European Union relations in the twenty-first century provides a valuable overview of transatlantic trade agreement negotiations and developments in the first decades of the twenty-first century. This edited collection examines key motivations behind trade agreements, traces the evolution of negotiations and explores some of the initial impacts of new generation trade agreements with the EU on South American countries. The book makes an important contribution to our understanding of relations between these regions by contextualising relations and trade agendas, both in terms of domestic political and economic policies and broader global trends. It demonstrates the importance of a shift toward mega-regional trade agreements in the 2010s, particularly under the Obama administration in the United States, in shaping South American and European agendas for trade agreement negotiations and their outcomes.Detailed case studies in the book investigate EU relations and negotiations with countries that have successfully negotiated new generation trade agreements with the EU: Mercosur, the Andean states, Chile and Mexico. Other contributions offer a wider overview of EU-Latin American relations, including parliamentary and civil society relations. The net result is a balanced analysis of contemporary EU relations with South America, useful for students and scholars of foreign policy and political economy in both regions.

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Latin American and European Union relations in an interdependent world going through “deglobalisation”

Arantza Gómez Arana

Introduction

The first two decades of the twenty-first century have seen both significant high and low economic growth, as well as an increased degree of integration (World Trade Organisation and European Union) and de-integration (Brexit and the US–Paris agreement). Until 2007, after the significant negative economic impact of 9/11, the growth in Europe was one of the highest in decades, in particular in countries that traditionally have not been considered the wealthiest, such as Spain and Ireland. However, the Eurocrisis that followed the financial crisis brought about bailouts and austerity measures for many EU countries, including Spain and Ireland. The austerity measures affecting public services among other aspects of the economy, together with the high level of unemployment, created enough discontent among Europeans to attract populist parties. The political discourse of these parties favours a return to the type of nationalistic ideologies that make them incompatible with globalisation and regional integration. In particular they are against the nature of the EU and the goal of an ever-closer union. Large numbers in society point to the already existing and future degree of European integration as the reason for their decline in quality of life in both economic and social terms. This is capitalised on by the populist parties. However, this pro-nationalistic anti-integration agenda is implemented differently at the economic and social levels when the populist parties become electorally successful. Limitations to migration are implemented but economic protectionism is not always fully developed. Even countries with no successful extreme right-wing parties since returning to democracy, such as Spain and Portugal, have recently seen limited success of Vox and Gente respectively. The pandemic seems to have allowed more room for populist ideas. Conspiracy theories around the existence of the virus and anti-vaccine groups became moderately successful during 2020, and extreme right-wing groups have questioned the lockdown measures.

The increase in populist ideas since 2016 in particular has materialised in different ways with the UK voting to leave the EU, Donald Trump becoming the president of the US, and Bolsonaro becoming the president of Brazil. The way that some of these populist governments have interacted with each other is also relevant. Trump seemed to have a confrontational attitude against several actors such as Latin America, the EU and China. This increased the already existent lack of trust, and consequently they are more inclined to diversify their external relations agenda (Santander 2020). According to Santander, both the US and China are trying to take advantage of each other's position in relation to LA countries where politically some of them are naturally closer to one of them. The relations between the EU and Latin America are being affected by all of these events.

Brazil is also part of another relevant trend. The rise of emerging economies in countries with large populations and with power projection in their regions became more noticeable at the beginning of the twenty-first century. The increase of these emerging economies surprised Western countries (Prashad 2013). Brazil became the world's tenth largest economy in 2005 (McGrew 2008). Brazil, Russia, India and China (BRICs) since 2006 have started to discuss political matters as a group. In 2011 South Africa joined them, with the acronym changing to BRICs. Having representation from Africa gave more validity to the aim of the South counterbalancing the North. The prediction was that by 2040 the economies of the BRICs and Mexico together will be superior to those of the G8 economies, with China at the top. This new scenario is challenging, in particular due to the conceptualisation of a unipolar world as the US's economic and military power have been unchallenged since the end of the Cold War. But, the role of China in challenging this unipolarism is significant. There is a debate in which the only one competing against US hegemony is China (Peterson 2016). However, from a security point of view, the military power of the US is still unchallenged, with the exception of the South China Sea (Peterson 2016).

The first two decades of the twenty-first century have seen a redistribution of power at the expense of mainly the EU and the US, favouring new powers which have become international players (Santander 2020). Apart from the US and the EU, in the last two decades other countries, including China, Japan, Iran and India, are investing in Latin America in sectors such as trade and transport and, of course, energy (Santander 2020). If a zero-sum game approach is taken, this means that Europe and the US are losing their power and presence in the region.

Russia has also invested in the region in terms of military alliances, through loans or investments and by selling weapons to countries such as Venezuela. This has had an impact on both the EU and the US (Santander 2020). Even Turkey has increased its presence through trade and with diplomatic links, increasing the number of embassies in the region from six to thirteen (Santander 2020).

In Latin America the election of Bolsonaro in 2018 with an individualistic agenda was expected to affect the negotiations with the other countries within MERCOSUR or with the EU. However, the agreement between the EU and MERCOSUR was achieved in 2019 during the presidency of Bolsonaro. Bolsonaro seemed to take the side of Trump in relation to China. According to Bolsonaro, China is “buying” Brazil (Santander 2020). Therefore Brazil could look at the agreement with the EU as a way of counterbalancing China. Although the EU and LA had intended for years to review their links, Trump's unilateral and conflictive measures against them actually accelerated their agendas (Santander 2020). Therefore, the counterbalancing exercise took place for some of them against Trump, potentially against China for others, or even against both.

This chapter argues that the shift in world politics that commenced in 2016 has created the best momentum to further develop Latin American and EU relations for political and economic reasons. For political reasons the shift is intended to reinforce an international arena where multilateralism and respect for international forums and international law continue to exist. For economic reasons it is a way of creating growth and redistributing economic power away from the two largest economies (the US and China) which have clear foreign policy goals regarding the projection of power in both Latin America and the EU. The remainder of this chapter discusses the economic balance of power that has developed over time between the North and the South with a discussion of the BRICs as well as a discussion of the potential outcomes of those struggles, followed by the development of mega-regional agreements until 2016.

The BRICs

It is becoming more noticeable how the US and the EU are no longer the only main actors in the international arena. Latin America is affected by this redistribution of power. In 2006 the BRICs decided to create a forum where they would engage as a way of counterbalancing the power projection of the North and to pursue multipolar regionalism (Prashad 2013). In 2011 South Africa joined them. Together they cover around 40 per cent of the population and around 25 per cent of both the land and GDP in the entire world (Prashad 2013). Economically speaking, the financial crisis of 2007 also debilitated the position of the US and the EU in comparison to other countries. However, for some, the only real competition for the US is China and India, as a consequence of the economic slowdown in Brazil and the contraction of the economy in Russia due to the decline in oil prices together with the impact of the economic sanctions after the Crimea crisis (Peterson ...