Fair trade between EU and Latin America?

AAA Towards a Symmetric EU-Latin America Trade Relationship? From 2001 to 2011, primary exports from Latin American and the Caribbean (LAC) increased from 44% to 52%, this illustrates how the continent still cannot move from its status as a primary goods exporter. Refined Wood Copper 3rd Crude Oil Pulp Central America Mexico Iron 1st 11% Venezuela 1st Motor 1st 3% 6% Vehicles Coffee Soybeans 1st 1st 1st Andean Motor Community Vehicles Soybean 12% 2nd Cakes Copper Brazil 1st Crude Oil 2nd 38% 2nd exports to the EU Copper Concentrate Banana 1st 3rd Soybean Cakes Motor 2nd Copper Concentrate Wood Chile Vehicles 13% 3rd Pulp 2nd 1st Iron 3rd Refined Soybeans 3rd Copper 1st Argentina 11% The EU has sharply reduced its imports from LAC in the last 50 years: 35% of LAC exports in 60s, falling to 13% in 2010s. 75% of these imports come from 4 countries (Brazil, Mexico, Argentina, Chile). Legend: % of exports to the EU (2009). Ranking as main LAC exporter per goods. MAIN TRADED GOODS LAC to EU % of total trade EU to LAC Soybeans Cake 7.1 5.4 Motor Vehicles Bananas 5.7 3.6 Medicines Passenger Vehicles Ships and Boat Aircraft > 15000 Kg Coffee 5.2 3.0 Refined Copper 4.6 2.9 Motor Vehicles 4.1 2.8 Crude Oil 3.9 1.8 Machines Soybeans Copper Concentrate Iron 3.6 1.7 Glucocidos : Vaccines 3.4 1.6 Nucleic Acids 3.4 1.3 Dishwashers Wood Pulp 2.9 1.2 Telecom Parts Source ECLAC 2013 Sustainable Mining 'Extractivism’? LAC minerals are now of key relevance for the EU economy. The problem is that these resources are scarce and non-renewable. Sn LÍ 65% world reserve 44% world reserve ... Tin world export: no-data 43% world export Lithium 44% world reserve 43% world export Fe 22% world reserve 23% world export Ni Iron cu Nickel Ag Copper 49% world reserve ... Silver 30% world export Al 23% world reserve 13% world export Ваиxite 26% world reserve 19% world export 180 billion US$ FDI revenues per sector Fe The mining sector provides the highest average FDI income (26%). This is two to three times more 26% Minerals Iron 56% FDI 10% Oil crisis in primary sector than in other sectors. Six of the top 25 EU TNCS were directly linked to the mining industry in 2010. 6% Shoes 7% Cars 100 10% Media 42% FDI in primary 8% Telecom sector 113 b. US$ 8% Chemicals in 2011 60 20 b. US$ in 2002 Inflow FDI to LAC Profits made The EU remains the main source of FDI by TNCS in LAC for LAC, with about 40% of total FDI (2010), and TNCS continue to receive huge profits. However, is the FDI boom in non-renewable natural resources leading to a "Green Economy"? 1990 2002 2006 2008 2011 Source ECLAC 2013 The current EU - LAC relationship fuels an unequal redistribution of wealth; depletion of non-renewable natural resources; global warming, and social conflicts. What's Wrong? Still more, massive-scale extractivism, is expected as the LAC mining exploration budget has increased 60-fold in the last 20 years. 2011 .. US$ 2001 ..... US$ 12.000 1991 .. .. US$ 2000 200 Millions Millions Millions Miniscule job creation: only four jobs are created in LAC for every one million US$ of FDI between 2003 and 2013. Yet, in the mining sector, which is the most profitable, this figure drops to 0,5 jobs. Although FDI inflows and TNC revenues jumped, 167 million people (29% of LAC population) still live under extreme poverty in 2011. The GDP/capita gap between LAC and the EU has increased from 14,000 US$ in 2000 to 20,000 US$ in 2011. 2000: 0,5 LAC GDP/capita : 7,500 US$ EU GDP/capita: 21,500 US$ 29% 2011: LAC GDP/capita: 11,000 US$ EU GDP /capita: 31,000 US$ The EU-Andean Trade Sustainability Impact Assessment, commissioned by DG Trade, reported that FTA would create even more problems: * Restriction on workers' rights * Damaging effects on small family shops * Reduced acccess of poor people to essential services * Increased damages to the environment Source ECLAC 2013 European Commission Directorate General for Trade 2009 SOME ALTERNATIVES Towards a Win-Win EU-LAC Relationship "When the currently huge investment opportunities will be saturated, there will be a world-wide political reframing of growth in terms of its quality rather than simply its quantity. (.….) This reframing will be necessary to support 'good global governance" in "Europe 2050" by the European Commission (2012) In such a context, the "Buen Vivir" narrative ("Good life/Living Well") is emerging in LAC as an alternative to the 35 year-long TINA discourse. The “Buen Vivir" paradigm questions the rationality of the current development paradigm, its emphasis on economic aspects and the market, its obsession with consump- tion, or the myth of continued progress. New strategies of regional integration and environmental sustainability are also materiali- zing as a concrete solution to move away the current asymmetric EU-LAC relationship. Regional integration is growing fast and will help the LAC countries to "disengage" from their primary export profile vis-à-vis the industrialized nations. from In Europe, over 50 civil society groups are currently demanding a paradigm shift in EU trade and investment policies: “support sustainable farming practices in Europe and the Global South that protect biodiversity, enhance the fertility of soils, reduce the use of fossil fuels and help prevent climate change". The EU can play http://www.alternativetrademandate.org/ a strong leadership role in supporting a win-win relationship with LAC countries! CIFCA APRODEV 13 M GRUPO SUR ALOP| ASOCIACION LATINOAMERICANA DE ORGANIZACIONES DE PROMOCION AL DESARROLLO A.C Red Europea de Incidencia UE- America latinay Carbe www.alop.org.mx www.cifca.org www.aprodev.eu www.gruposur.org in cooperation with Not So Crazy.eu 20