Prime Minister Sanchez capped off a busy summer with a four-day tour of Latin America just before autumn hit in Spain. This was his first trip to the region since becoming prime minister and included stops in Bolivia, Chile, Colombia, and Costa Rica. The tour provided for a deepening of bilateral relations ahead of the Ibero-American Summit in Guatemala later this year, and bolstered trade ties with a high-potential region, as global commerce dynamics grow more turbulent by the day.
Latin America is comprised of 24 diverse countries scattered across Central America, South America and the Caribbean. The term “Latin America” is derived on the fact that each of these countries speaks a Romance language – French, Portuguese or Spanish. In explaining why Bolivia, Chile, Colombia and Costa Rica were chosen for his tour, the prime minister’s office noted that they each represented various sizes, political orientations, geographical locations and social conditions, and therefore, demonstrated the Spanish government’s desire to engage in both a constructive and multidimensional dialogue with the region.
Alongside the European Union, Latin America is a region of central importance to Spain’s foreign policy. For that reason, successive Spanish governments have prioritised the maintenance of strong political, cultural and economic ties with the region. This is evidenced by the fact that Spain commits a larger proportion of its resources to preserving these links than countries such as the United States or China. Spain has also thrown its support behind an EU free trade agreement with Mercosur and is a co-founder of the Ibero-American Summit, which provides a forum for multi-lateral dialogue between 19 Spanish and Portuguese speaking countries.
A key part of Sanchez’s tour included the promotion of trade and investment. In a statement, the government explained that “Latin America is today one of the main trading partners and an important destination for Spanish investment, present in key sectors such as banking, energy, communications, construction, infrastructure management and tourism”. After Germany, Spain is the second largest EU exporter goods and services to Latin America.
Latin America has also been an important investment market for Spanish businesses. Between 1992 and 2012, Spanish companies invested approximately $117 billion in the region. This diversification helped many of these firms weather the economic downturn in Spain. For instance, in 2012 around 18 percent of profits earned by Spain’s 200 largest publicly traded firms came from Latin America.
While in Bolivia, Sanchez and President Evo Morales signed an agreement on the construction of a bioceanic train. “The importance that the government of Spain, my country, gives to this project is absolute. We are leading this million-dollar project together with Germany and Switzerland”, said Sanchez. This project is part of 3,000 km long Bi-Oceanic Railway Corridor. If completed as planned, it would run from Puerto Santos in Brazil to its ultimate destination of Puerto de Ilo in Peru.
However, this trip was about more than just economics. While in Costa Rica, Sanchez held talks with President Alvarado on climate change and decarbonization. He also signed a Memorandum of Understanding with Chile that will see the two countries cooperate on risks to their security, financial and government IT systems as well as fighting terrorism, drug trafficking and organised crime.
Like Europe, Latin America has been experiencing a marked increase in migration, primarily due to financial instability in Venezuela. In fact, the International Organization for Migration has compared it to peak crisis moment experienced in the Mediterranean three years ago. Speaking about the crisis, Sanchez said, “Venezuela has to start a dialogue with itself…to find a solution to this political crisis. And of course, the international community must accompany that dialogue”, explaining that Spain would be an active part of that dialogue. Sanchez also acknowledged the pressure this has placed on Venezuela’s neighbours and announced that the EU would be providing 35 million euros to the region to help cope with the migration crisis.
Sanchez’s tour can be viewed as part of a more robust foreign policy agenda that has emerged in Spain. Along with re-asserting its influence through key EU institutions, Spain is actively strengthening ties in a region of economic and political importance. To that end, Sanchez will return to Latin America in November for the 26th Ibero-American Heads of State and Government Summit.