London’s lure

New dynamism in UK-Latin America relations is on the horizon.

The UK has traditionally been viewed as a periphery country within Latin America’s bilateral relations ecosystem – relations with Washington and Beijing dominate diplomatic discourse, unsurprising given that the US and China lead as the region’s primary export markets. 

On the other side of the Atlantic, the region has too often been overlooked by London – which, whilst enjoying significant trade and defence ties, has consistently punched below its weight when it comes to the potential for greater engagement with the region.  

A São Paulo-based journalist and specialist in Latin American geopolitics explained, “On the geopolitical front, tensions emanating over the Malvinas/Falklands dominate discussions in international forums. For its part, the UK is keen to apply pressure on the Fernández administration to increase food, gas and mineral supplies to Britain given inflationary pressures driven by the Ukraine conflict.”

“…the UK is keen to apply pressure on the Fernández administration to increase food, gas and mineral supplies to Britain given inflationary pressures driven by the Ukraine conflict.”

Journalist and specialist in Latin American geopolitics, Brazil

The Canning Agenda, published by the UK’s Foreign Office in 2010, was widely regarded as an ambitious step by London to develop relations with the region but there are further steps the UK can and should take to inject much-needed dynamism into bilateral relations and increase the volume of British exports destined for the region.   

“The UK can significantly enhance its regional presence – both in soft and hard power terms; transnational organised crime, the illegal drugs trade, money laundering and peacekeeping efforts would be good places to start,” explains the geopolitical specialist.  

Research undertaken by Chatham House suggests that among the most significant hurdles for British exporters to the region includes a lack of market familiarity, excessive regulation and a sense that the UK more actively encourages investment in middle eastern and far eastern markets.  

Given inflationary pressures driven by the Ukraine crisis which has seen food prices soar in British supermarkets, London is now courting Argentina and Brazil. Both are major food suppliers – a significant uptick in exports (particularly meat and dairy items) could help to bring down prices. Indeed, there is significant room for growth given that in 2018, Brazil and Argentina accounted for only 1.6% of the UK’s agricultural market across eight different sectors.     

Banking products represent one of several financial sectors where London should have a much greater presence across Latin America. Brazil accounted for only 0.4% of UK service-oriented exports in 2020 – astonishing given the country’s 200 million plus population as well as its significant economic clout. Insurance and pension services were the second largest export type exported from the UK to Brazil but were only 13.4% of an already negligible 0.45%. 

On the bilateral front, the UK is keen to reward those countries in the region it perceives as having been more assertive in their condemnation of Moscow’s invasion of Ukraine. Colombia, for example, was singled out by UK trade minister Mike Freer. Post-Brexit, London is likely to prioritise those economies with the greatest potential for UK exporters to enhance trade relationships.  

The government will be watching how the new leftist administration in Colombia of Gustavo Petro will approach trade relations – the UK will be pushing for a more business-friendly tax system and the cutting of red tape. Given that Petro wants to increase corporation tax to spend more on welfare this could complicate relations.   

“UK companies are likely to be prominent bidders in the region’s telecommunications infrastructure, particularly 5G and fibreoptic broadband. British companies can provide technical experience, add value with professional services and support efficient project management,” adds the geopolitical specialist.   

“British companies can provide technical experience, add value with professional services and support efficient project management.”

Journalist and specialist in Latin American geopolitics, Brazil

London is also likely to aid administrations across the region in their efforts to decarbonise – attractive to ESG-conscious UK companies and to Latin American administrations keen to stress their green credentials. A win-win you could say, but it will take time and effort on both sides.   

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