The EU’s ambassador to Argentina since September 2021, Amador Sánchez Rico, takes stock of the state of relations between the EU and Buenos Aires, which he believes hold much largely untapped potential. He also argues the case for a trade deal between the EU and the Mercosur countries as a geopolitical advantage at a time when Europeans are actively seeking to diversify their sources of supply of critical raw materials and energy. (Interview conducted by Mathieu Bion on Thursday 13 March)
Agence Europe – How is the EU’s delegation to Argentina organised and what are its principal activities?
Amador Sánchez Rico – The European Union has had a presence in Argentina for more than 30 years now. For the last three of them, we have been housed in a modern building that projects the image, values and policies of the European Union, such as transparency and respect for environmental standards. Our team consists of 26 people, 12 of them Europeans. Even though it is not a particularly large delegation, we try to make our presence felt.
Our principal duty is to promote the interests and values of the European Union. For a long time, we believed that the interests came from one side and values from the other. Here in Buenos Aires, we are active as Team Europe, with 21 ambassadors from EU countries, a considerable number for the region. This reflects the importance attached by Europe and its member states to Argentina, a very like-minded country. Outside the EU, I do not know any other country that is closer than Argentina to our culture, through its history and language.
There is tremendous scope to do more with Mercosur. There are between 800 and 900 European businesses in Argentina, representing almost every sector. Almost 50% of the country’s foreign direct investment comes from the EU.
But we must not rest on our laurels.
Everything the European Union needs, Argentina has. From energy, particularly renewable energy in the southern provinces, such as Santa Cruz and Chubut, which tick all the boxes for the production of ‘green’ hydrogen, to critical raw materials needed for the green transition, which are present in the North, such as lithium in the provinces of Catamarca, Jujuy and Salta. The copper sector is starting to gather pace and is showing great promise in terms of commercial links with the European Union.
What progress has been made with the implementation of the Memoranda of Understanding (MoU) signed between the EU and Argentina in 2023 on energy (see EUROPE 13224/1) and critical raw materials (see EUROPE 13200/24)?
These frameworks steer European investments in both sectors. They provide predictability and increase trust on the part of operators. Thanks to these two MoU, which are part of the EU’s ‘Global Gateway’ strategy, we have seen an explosion in the number of initiatives being undertaken on both sides.
We have been on four on-site visits to European businesses, to explore investment opportunities. Some of these, moreover, are starting to materialise or are likely to do so in the near future, such as Stellantis investing in a responsible copper mine in San Juan, or Eramet and Techint in a lithium mining concession in Salta.
Similarly, a trip to Brussels was arranged last December for national and regional Argentinian businesses and institutions, to put them in touch with the European authorities and the European Investment Bank (EIB). This initiative was extremely successful: it is already starting to pay off in terms of investments in the framework of 'Global Gateway'.
Aside from energy and critical raw materials, which are the other strategic sectors in the EU/Argentina relations?
In the field of new communication technologies, we have set out a roadmap with the Argentinian government comprising 40 or 50 initiatives for the digital transition. The greatest focus of our efforts is artificial intelligence. We explain that the regulation on artificial intelligence ('IA Act'), these EU standards, are no hindrance to investment; quite the reverse, they are a framework designed to build confidence.
Talking about the concerns of third countries that EU rules might be an obstacle to investment or even to promote protectionist objectives, many Latin American countries have put their heads above the parapet to call for the regulation on the fight against deforestation to be delayed...
This has been a hot topic for the last two years! We have had to do an awful lot in terms of education.
Some players, such as civil society, have been very comfortable with the idea that in Europe, consumers are calling for more transparency and responsible farming. This has landed less well with others, who are concerned at the prospect of higher costs. We have undertaken major communication efforts and funded initiatives. Meat from Santa Fe already arrives in the port of Antwerp fully guaranteed and certified to prove that it does not come from deforested areas.
One of the criticisms was that the EU was not ready for implementation. We have shown that we were listening by postponing the entry into force of the rules [until the end of 2025] (see EUROPE 13538/1).
The regulation is something that should be seen as an opportunity rather than a threat. Argentina has great potential in this area, thanks to its extensive cattle-rearing practices.
What opportunities will the agreement between the EU and Mercosur bring to Argentina? How can the Europeans be reassured about the consequences of this agreement for the EU internal market?
You have to look at the agreement beyond its purely commercial aspects, move away from considerations about winners and losers and take a more geopolitical reading of it, in light of China increasing its presence in many countries of the region. Over and above the consequences of the Russian invasion of Ukraine, there is enormous pressure on energy supply. The EU needs to diversify its partners at all levels.
Does the Argentinian president, Javier Milei, still want his country to remain in Mercosur, having announced that he was prepared to negotiate a bilateral trade deal with the United States?
We have been informed of the Argentinian President’s intention to negotiate a free-trade deal with the US. There is nothing new in the idea. It is not for me to say whether this will force Argentina to leave Mercosur.
What President Milei has said many times is that he would like slightly more flexible rules within Mercosur to allow him to move forward a deal with Washington. We would first need to see what kind of deal it is.
The fact that the EU is a highly integrated bloc represents an enormous opportunity for Argentina and the countries of Mercosur, where internal customs barriers have shown their limits. The agreement with the EU could breathe new life into Mercosur by stimulating its own integration.
At the most recent EU/CELAC summit, the idea of a permanent coordination mechanism to assess progress was floated. What is the state of play with this idea now?
The subject is being debated at the moment. Having a permanent structure would provide stability and facilitate the monitoring of the initiatives launched, such as the bi-regional alliance in the digital sector (see EUROPE 13142/34).