CELAC-EU: Latin America and the Caribbean facing the caravels of green and digital capitalism

Moved by an urgent impetus for peace, the Community of Latin American and Caribbean States -CELAC [1]- invested a good part of its first years in filling the Declaration of Latin America and the Caribbean as a Peace Zone [2] with content, which is one of its founding pillars and which, as such, inhibits it from any temptation to succumb to the siren songs that various warring bodies place in its path. It is largely thanks to this that the region has no ostensible armed conflict, wants to stay that way, and advocates peacebuilding that extends to the world.

By Irene León

On the contrary, ‘it is conceived as a representative mechanism for political consultation, cooperation and economic, social and cultural integration, based on democracy and dialogue as an instrument for settling differences while recognising the right of each country to freely define its political and economic system'[3]. The definition of a peace zone is interrelated to its commitment to multilateralism, to the search for non-violent and diplomatic solutions to conflicts and, in the worst-case scenario, to neutrality.

This is why the region refused to take sides against Russia and support Ukraine as the EU urged at the 3rd CELAC-EU Summit [4], which took place in Brussels on 17-18 July 2023. Moreover, in a scenario where arms dealers have made available everything from cluster bombs to nuclear ‘deterrent’ trays, “we must perpetuate humanism and combat armament and the proliferation of nuclear weapons. The European Union must guarantee us a greater effort to achieve peace”, emphasised Honduran President Xiomara Castro.

The CELAC countries question the fact that while trillions are being spent on war, no effective measures have been taken to eradicate inequality or even hunger. In 2022, global spending on arms amounted to 2.2 trillion dollars; the European Union alone invested more than 345 billion dollars, while the United States alone spent 877 billion dollars [5]. The Declaration of the III EU-CELAC 2023 Summit [6] alludes to peace and international instruments to resolve conflicts, while the 2016 Declaration values the foundation of the Declaration of Latin America and the Caribbean as a Zone of Peace and points out the relevance of the Treaty of Tlatelolco [7] (1967) that outlaws nuclear weapons in the region and promotes disarmament.

CELAC’s plans and the EU’s plans for CELAC

If both regions agree on the importance of improving their bilateral relations and point to several common global issues such as global warming or pandemics, their approaches refer to different geopolitical projections. CELAC, which is the voice of Latin America and the Caribbean in the world, contemplates varied international relations with the different regions, including agreements with the axes of multipolarity, as in the case of China, with which it has a joint Action Plan.

In its Reactivation and Strengthening Plan[8], CELAC articulates its priorities around the consolidation of its own capacities and sovereignty, as well as the immediate establishment of redistribution mechanisms, among others through measures involving the International Financial Institutions, such as timely access to Special Drawing Rights or the treatment of foreign debt, whose weight exceeds 70% of regional GDP and which currently constitutes a channel for the flight of resources, due to the interest, charges and surcharges on loans. The creation of its own currency to facilitate the diversification of trade exchanges is also on the table.

At the same time, CELAC plans to strengthen food, technology and energy sovereignty, areas which, as we shall see later, are at the heart of the EU’s renewed plan for the region. In its relationship with Europe, apart from the explicit interest in a fluid and egalitarian economic relationship, it has no specific political plans, nor any unilateral or interfering measures, although it is concerned about human rights violations in migratory processes, mainly in the Mediterranean, or the repression of civil society for its demands, among others.

For its part, the EU will be proposing an alliance based on its Global Gateway project[9], an international governance agenda that seeks to reposition Europe in the world. It aims to trigger investments by the EU, its member states and its financial institutions, mainly in energy, clean, green and digital sectors, as well as in infrastructure, health, education and research. It is a mobilisation of public resources to further strengthen the investment and profit potential of private capital. The President of the Council of the European Union, Pedro Sánchez, says that public investment will leverage private investment and thus create fairer societies.

At the same time, with this international relaunch the EU aims, among other things, to compete with China’s Silk Road proposal, which is based on the win-win principle. In 2022, trade between China and Latin America reached some 485.7 billion dollars and is projected to increase.

In the framework of the 3rd EU-CELAC Summit, the President of the European Commission, Ursula von der Leyen, announced the investment of 45 billion euros in the Latin American and Caribbean region, which she has called a natural ally and long-standing friend. The European Union, which registers trade partnerships with 26 of the 33 countries in the region, recently obtained new agreements on clean hydrogen with Argentina, Chile and Uruguay, while it remains hopeful of concluding a free trade agreement with Mexico and above all of achieving the conclusion of the principle of the free trade agreement undertaken in 2019 with Mercosur.

Von der Leyen emphasises the aspiration for the flow of business relations between the two regions, in order to boost the creation of opportunities for everyone ‘in their rightful place’ in the supply and value chains. However, in Latin America and the Caribbean, a large part of the conflicts stem from non-compliance with rights attributed to the private sector, especially the corporate and transnational sector, which benefits from all possible incentives and lacks regulations. Under these conditions, public incentives for the incursion of the European private sector in strategic areas of Latin America and the Caribbean could lead to the privatisation of natural and energy resources by third parties.

On the other hand, in connection with the Global Gateway, the so-called “international order based on rules” has positioned itself, which, as Cuban President Miguel Diaz Canel points out, has not been agreed upon by the states, supplants international legislation and even takes the place of multilateral bodies, to the benefit of the private and corporate sector. This explains the appeal to equality and transparency made by CELAC presidents in the framework of the III Summit, in the words of the President of the Plurinational State of Bolivia, Luis Arce, “all states have the attribute of sovereignty and the natural resources of the countries should be treated with that respect”.

Some dynamics of the energy transition

Latin America and the Caribbean stand out for the abundance of their natural and energy resources, with significant reserves of renewable and clean energies: solar, wind, water, hydrogen and others, as well as fossil energies, which continue to be of great interest as a large part of industry, transport and others depend on them. Venezuela has the world’s largest oil reserves, while Bolivia, Argentina and Chile make up the so-called lithium triangle with 85 per cent of this precious mineral.

International demand for these resources, especially for clean energy, has multiplied in line with the effervescence of energy transition plans, prompted by the imminence of climate change and related international commitments. “In 2022, 224.579 billion dollars entered Latin America and the Caribbean, the highest figure since records began.”[10] These investments include the incursion of financial capital investment funds and other actors that are not directly related to collective solutions but rather to private accumulation, so that the energy transition has acquired contours linked above all to energy security, not least because the countries of the North merge policies with the development of markets.

In this context, it is essential for the region to validate the sovereignty axis as an articulator of its energy proposal. At the summit with the EU, CELAC has put the issue of extractivism on the table, even associated with practices resulting from the colonial legacy, which still persist and are the object of demands for reparations, especially by the Caribbean, where situations of direct colonialism persist, as well as by Afro-descendants and indigenous peoples. According to the Argentine president, Alberto Fernández, the aforementioned Third Summit would have allowed the issue of extractivism to be addressed directly for the first time and a mechanism to put an end to it to be proposed.

The EU argues that it is not only about extracting resources, but also about boosting value chains and having viable suppliers, for which local communities would also benefit. It argues that the EU-LAC Global Gateway investment agenda is defined as a political commitment to ‘work together’, identifying fair green and digital investment opportunities in Latin America and the Caribbean, which would benefit from the open environment generated by trade and investment agreements, thereby contributing to the achievement of the Sustainable Development Goals.

Pragmatic, CELAC president Ralph Gonsalves recalls that ‘in 2009 there was already talk of a billion-dollar fund to mitigate climate change and nothing has happened yet’. But beyond the funds, Gonsalves himself and several CELAC presidents point out that the underlying issue is the dynamics of the capitalist system itself, which prioritises the reproduction of capital over human and planetary life’, as Bolivian president Luis Arce pointed out, while calling for ‘thinking like the international community that we are and jointly identifying the causes and solutions for each of the aspects of the multiple crises of capitalism’.

This makes it clear that CELAC, in addition to its search for socio-economic solutions, urgently needs to refine its proposal for regional self-sufficiency and its own energy transition plan, as well as to maximise the projections for technological development, digital sovereignty and knowledge, which are included in its Reactivation and Strengthening Plan. On this basis, respectful extra-regional relations will flow, including, as Brazilian President Luiz Inácio Lula da Silva emphasised, the viability of being equal partners with Europe.

[1] Community of Latin American and Caribbean States (2021) What is CELAC? https://portales.sre.gob.mx/ppt-celac/es/que-es-la-celac/cumbres-celac

[2] CELAC(2014). Proclamation of Latin America and the Caribbean as a Zone of Peace. Cuba https://portales.sre.gob.mx/ppt-celac/es/que-es-la-celac/cumbres-celac

[3] Irene León (2022), La integración en perspectiva soberana, en Humanidad en REDH Año 2023 No.1. Venezuela

[4] CELAC-European Union Summit, Brussels, July 17 and 18, 2023. https://www.consilium.europa.eu/es/meetings/international-summit/2023/07/17-18/

[5] Stockholm International Peace Institute -SIPRI (2022). Military Expenditure Database. https://www.sipri.org/databases/milex

[6] Council of Europe (2023) EU_CELAC Summit Declaration 2023 / 12000-23. https://www.consilium.europa.eu/media/65925/st12000-es23.pdf

[7] Treaty for the Prohibition of Nuclear Weapons in Latin America and the Caribbean (1967). https://www.oas.org/xxxivga/spanish/reference_docs/Tratado_Tlatelolco.pdf

[8] CELAC (2021) Declaration of Mexico City. VI Summit of Heads of State and Government of CELAC. Mexico. http://www.sela.org/media/3223268/declaracion-pol%C3%ADtica-de-ciudad-de-mexico-vi-cumbre-celac.pdf

[9] European Commission. Global Gateway. https://commission.europa.eu/strategy-and-policy/priorities-2019-2024/stronger-europe-world/global-gateway_es

[10] ECLAC (2023)Foreign Direct Investment in Latin America and the Caribbean 2023. https://www.cepal.org/es/publicaciones/48978-la-inversion-extranjera-directa-america-latina-caribe-2023

Irene León, Sociologist and communicator, Ecuador

Redacción Argentina