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EU-Latin America: growing relations

European Commission - MEMO/05/173   25/05/2005

Other available languages: none

MEMO/05/173

Brussels, 25 May 2005

EU-Latin America: growing relations

Building on long-existing bilateral relations between European countries and Latin America, the European Union has established and enhanced links with Latin America since the 1960s. The relationship between the two continents has evolved substantially over the past three decades. Today’s partnership reflects the increasing importance and growing potential of the Latin American (LA) region, and the will of both parties to further strengthen the relationship in the future. The EU is an important economic and political partner for Latin America. It is the leading donor in the region, the premier foreign investor and the second most important trade partner.

Heads of State and Government of both regions, who met for the first time in Rio in 1999, have set up a bi-regional strategic partnership that highlights particular priorities to ensure co-ordinated action in the political social and economic sphere. The key aspects of the EU-Latin America strategic partnership include political dialogue and economic, scientific and cultural cooperation. The strengthening of trade links and the harmonious integration of the partners into the world economy are also key objectives of this partnership.

Since 1999, the European Commission has successfully negotiated Association Agreements with Mexico and Chile, political dialogue and cooperation agreements with the Andean Community (Bolivia, Colombia, Ecuador, Peru, and Venezuela) and Central America (Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, and Panama). Negotiations are also under way on an Association Agreement with Mercosur (Argentina, Brazil, Paraguay, and Uruguay). These agreements, combined with the ongoing major regional co-operation programmes, provide a solid basis for the intensified political relations that the EU is developing with Latin America.

The Commission’s two main priorities for Latin America are social cohesion and regional integration.

At the Guadalajara Summit priority was given to social cohesion. It was made a central element of the partnership between the European Union and Latin America. The EU’s past experience in promoting social cohesion, as well as recent initiatives undertaken throughout the region in this field, form the basis for co-operation between the two regions aimed at to tackling inequalities, exclusion and poverty.

Further steps towards regional and sub-regional integration will accelerate economic growth, while at the same time strengthening the strategic bi-regional EU-LA partnership and facilitating progress towards an effective international multilateral system. In economic terms it will help the region to fulfil its potential and facilitate the integration of individual countries into international markets. Politically, it will allow Latin America to become a more influential player on the global scene.

The other important issue is multilateralism. An effective multilateral system, with the UN at its centre, is essential if these regions are to confront the formidable challenges facing the world: poverty; social exclusion; hunger; abuses of Human Rights; conflict; terrorism; weapons of mass destruction; the proliferation of small arms; the product and trafficking of illicit drugs; the spread of HIV/AIDS and other infectious diseases; and environmental degradation.

EU’s external assistance to Latin America, 2000-2004

The EU is the major investor in Latin America, its second trade partner and the main donor (around €2,000 million every year, including both Community and Member State budgets).

The sustained reshaping of EU co-operation with Latin American countries in recent years has been characterised by the confirmation, at each one of the EU-Latin American Summits, of three fundamental priorities:

  • The fight against poverty and social inequalities.
  • Integration into the world economy through strengthened Trade Related Technical Assistance (TRTA) actions.
  • The consolidation of the rule of law.

These three priorities for the whole Latin American region were the subject of large and regular discussions within the pertinent forums with Latin America. The overwhelming majority of Community aid has been concentrated increasingly under these three priorities (respectively 40%, 25% and 15%).

With regard to social cohesion - the EU’s central priority in the region - the Commission approved in 2004 a €30 million programme EUROSOCIAL. The programme’s main objective is to contribute to increased social cohesion in Latin-American countries though action in the fields of education, health, the administration of justice, the taxation and employment.

In total, during the last three years, EU co-operation with Latin America has shown a constant increase: from €277 million in 2000 to €312 million in 2004 in commitments, and from €195 million in 2000 to €314 million in 2004 in payments, as well as a significant acceleration of its implementation.

Concerning the implementation, the amounts earmarked for 2003 and for 2004 were executed at 100%.

As regards RAL (“reste à liquider”), the results illustrate appropriately the progress achieved: the disbursement ratio (end of the year RAL/payments of the year) went from 8 years in 2001 down to 4.3 years in 2004.

The results obtained in 2004 are expected to continue in 2005 when foreseen payments are expected to largely exceed the appropriations available.

For additional information on the EU-Latin America relations

http://ec.europa.eu/external_relations/la/index.htm

And for EU assistance to Latin America

http://ec.europa.eu/europeaid/projects/amlat/index_fr.htm


Country Review Latin America

(including all budget lines managed by AIDCO in Latin America)

Commitment (€ Million)

Payment (€ Million)
RECIPIENT
2000 ( * )
2001 ( * )
2002 ( * )
2003 ( * )
2004 ( ** )
2000 ( * )
2001 ( * )
2002 ( * )
2003 ( * )
2004 ( ** )
COSTA RICA
0,4
9,6
2,0
11,5
-
1,2
1,4
1,5
1,6
5,5
EL SALVADOR
8,5
45,3
16,6
1,3
0,0
15,0
10,6
21,8
29,5
17,7
GUATEMALA
7,1
28,9
14,9
28,5
8,4
21,9
22,4
32,6
21,3
18,6
HONDURAS
27,8
6,7
43,7
47,0
42,0
18,6
15,0
24,8
22,6
38,5
MEXICO
1,0
3,1
6,2
30,9
9,1
3,7
3,6
5,1
4,0
10,1
NICARAGUA
22,7
44,0
15,0
49,0
40,1
44,7
33,7
34,5
45,9
49,3
PANAMA
-
9,3
0,4
15,2
-
3,4
3,3
1,5
1,6
1,4
ARGENTINA
12,5
1,2
3,9
7,7
9,4
7,1
8,7
5,1
3,4
5,3
BOLIVIA
31,0
8,7
20,0
56,7
58,5
27,5
29,1
23,2
64,6
29,0
BRAZIL
27,6
6,4
10,3
12,3
0,5
18,5
16,7
15,9
18,8
5,8
CHILE
14,0
3,3
2,7
23,1
12,2
5,9
8,8
7,5
9,3
13,0
COLOMBIA
1,1
41,5
9,5
46,6
23,6
7,8
8,6
10,5
18,4
26,9
ECUADOR
5,9
22,2
5,1
23,2
41,5
6,3
5,6
8,3
13,4
12,0
PARAGUAY
1,0
1,3
1,4
1,0
13,0
5,0
8,3
10,4
5,1
3,6
PERU
18,6
9,1
6,6
18,6
16,0
25,6
21,3
15,0
35,8
9,2
URUGUAY
1,9
1,6
2,2
9,1
3,0
2,7
2,2
2,7
4,2
8,2
VENEZUELA
1,4
38,0
22,0
1,0
0,2
4,7
3,7
8,4
9,2
8,9
CENTRAL AMERICA
33,2
9,8
67,6
37,4
0,8
3,3
-
1,1
15,5
19,0
MERCOSUR+
COMUNIDAD ANDINA
4,8
4,0
17,8
12,8
7,6
2,3
-
0,3
9,7
5,3
PLURIGEGIONAL PROGRAMMES
96,1
88,3
125,4
16,1
61,9
25,8
35,5
37,0
63,3
72,7
HIPC (highly indebted poor countries)
45




45




GRAND TOTAL
361,6
382,3
393,3
449
347,8
296
238,5
267,2
397,2
360

(*) Source 2000 -> 2003 :
Data warehouse official CAD Figures (OECD)
(**) Source 2004 :
Data warehouse provisional CAD figures


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