Brussels, 28/01/2013 (Agence Europe) - The 7th EU/Latin America summit on 26-27 January, underlined the importance of legal certainty for investments made on both sides of the Atlantic (see EUROPE 10768).
The final statement in Santiago de Chile states that “we recognise the importance of stable and transparent regulatory frameworks in both regions and of providing legal certainty for economic operators”. Discussions on this point proved tough with, according to the EFE agency, Argentina, Bolivia, Cuba, Ecuador and Venezuela opposing any reference to legal certainty. Europe was taken by surprise by the expropriation measures targeting European companies, such as the Spanish Repsol company with the nationalisation of YPF in Argentina (see EUROPE 10747).
European Council President Herman Van Rompuy spoke of the conditions that could create quality investments, such as “a predictable, transparent and stable legal framework”. Summit host, Chilean Prime Minister Sebastian Piñera summarised the statement: “More free trade, less protectionism and at the same time more legal certainty and the rule of law”.
In their attempts to establish a better balance, the 60 leaders attending the summit also recognise “the right of countries to regulate in order to meet their national policy objectives in accordance with their international commitments and obligations”. The Latin Americans were also successful in having it included in the statement that it was “vital that investors comply with national and international law, in particular, inter alia, on taxes, transparency, protection of the environment, social security and labour”. Bolivian President Evo Morales also wanted the Europeans to act like partners and not as pirates targeting natural resources.
On an equal footing. The current situation in which, broadly, Latin America is undergoing an unprecedented period of stability and growth, while Europe is in recession and entangled in problems of economic governance, has contributed to a rebalancing of relations between the two regions. Anxious to establish “a strategic association of equals”, German Chancellor Angela Merkel praised Latin American dynamism which “demonstrates to us that in Europe we have to make an effort not to be left behind”. At the end of her first visit to Chile she added that “we have to improve our competitiveness and reduce our debt”.
Implementation of the trade agreement with Colombia and Peru, as well as the association agreement with Central America will undoubtedly open the way to creating new outlets for European companies whose investments represent more than 40% of total foreign direct investment in Latin America. Certain European leaders also used this occasion to attract Latin American capital. According to the newspaper, El País, Spanish Prime Minister Mariano Rajoy declared that Spain should be used as the door to Europe, “now that Latin American companies are becoming more international”. Suffering from the painful consequences of his country's economic austerity, he also called on European countries that were able to, such as Germany, to make more of an expansionist effort to help counterbalance the effect of the cuts and reforms being carried out in countries experiencing difficulties.
During the summit, leaders from the two regions reaffirmed the values and principles they sought to promote together in international fora, such as democracy and environmental protection. The updated 2013-2015 action plan now includes a chapter on this kind of issue. Its objective is to promote the participation of women in political life and eradicate all forms of violence against women, as well as promote their independence, particularly in economic terms.
Brussels-based European and Latin American civil society networks (Alop, Aprodev, CIFCA, Grupo Sur, OIDHACO and CONCORD) welcomed the launch of the bi-regional dialogue on these issues and underlined the importance of trade policies based on “co-operation, complementarity, solidarity and the fight against inequality and poverty”. In a joint press release they affirmed that “the trade agreements signed with Colombia, Peru and Central America created a number of serious concerns among civil society due to the asymmetric nature of the two regions and the prevalence of economic interests over those of human and socio-environmental rights”. They also expressed their concerns about the Euro-Latin American Foundation, which they believe “began to operate without any genuine legitimacy or consultation with or participation from civil society”. On the sidelines of the summit, the Euro-Latin American Society based in Hamburg, signed a cooperation agreement with the Development Bank of Latin America (CAF). The head of the Foundation, former Commissioner, Benita Ferrero-Waldner, indicated that this agreement will support “the setting up of networks involving civil society activists, academics and think tanks from the two regions”.
European Commission President José Manuel Durão Barroso paid a visit to international space observation facilities, funded by the EU. Chile benefits from excellent weather conditions and 70% of global investments focus on this sector. (MB/transl.fl)