Potential partners - and what connects us to them

Latin America

Germany and Latin America have been linked for centuries. No other region in the world beyond the vicinity of Europe and the North Atlantic region is as close to Germany historically, culturally and spiritually as Latin America. The predominantly Christian region with close historical ties to Europe has always seen itself as part of the western world and is therefore a natural partner in the pursuit of peace, freedom and security in the world.

LEARN MORE
Relevance
Status quo
Potential

Germany and Latin America have been linked for centuries. No other region in the world beyond the vicinity of Europe and the North Atlantic region is as close to Germany historically, culturally and spiritually as Latin America. The predominantly Christian region with close historical ties to Europe has always seen itself as part of the western world and is therefore a natural partner in the pursuit of peace, freedom and security in the world.

Geographically distant from Germany and, for a long time, politically and economically located in the United States’ geopolitical zone of influence, the region has never been at the top of the foreign policy agenda. However, a large number of German speakers in the region and the strong presence of German companies bring Latin America culturally and economically closer to Germany than might be expected at first glance. Germany’s relations with Latin America, and especially with South America, have a solid foundation thanks to high emigration to southern South America (Argentina, Brazil, Chile, Paraguay, Uruguay) in the 19th century, and extensive direct investment in key industries, such as automobile production in the 1960s to 1980s, which made an important contribution to the development of national industries in the larger economies of the region. Alongside Spain, which, as a former colonial power, continues to claim a special role in relations with Latin America, Germany is therefore one of the few European countries with its own profile in the region.

Latin America and Germany are closely linked, particularly in the economic sphere: German companies such as Volkswagen, Bayer, BASF and Bosch have been producing in Latin American countries for decades, generating a considerable proportion of their profits there. Although Asia has overtaken Latin America economically in the last two decades, the region is still an important location for German companies. More than 1,300 German companies are based in the São Paulo economic area in Brazil alone, making it the largest production location outside Germany – even ahead of China(!). These economic ties also have major relevance from the host countries‘ perspective: in the region’s largest economies, Mexico and Brazil, German subsidiaries are responsible for around 5 percent of the gross national product; German companies even contribute around 15 percent of the added value in the Brazilian industrial sector. Latin America also plays a significant role in terms of direct investment. Although the region as a whole, again, lags behind the Eurozone, North America and Asia, Germany has strategically expanded its investments, particularly in the Latin American growth decade of 2004 to 2014, and is showing great interest in the developing sales markets.

Despite the importance of the economy in the context of German-Latin American relations, other “soft” policy areas largely dominate the foreign policy agenda. Development cooperation and foreign cultural policy not only shape the German view of the region, but also characterise the fundamental orientation of German foreign policy towards Latin America. Compared to other regions of the world, a dense network of German schools and Goethe Institutes, as well as agencies of the German Academic Exchange Service (DAAD) and institutions of scientific cooperation, such as the German Centre for Research and Innovation (DWIH) in Brazil, promote cultural exchange and form an important basis for relations. Even more important, however, is development cooperation, which eclipses all other areas of international cooperation with Latin America, not only in terms of the volume of funding available, but also in terms of the choice of key issues that determine relations between Germany and the region. This means that it is primarily development policy issues, such as combating climate change, producing sustainable energy or promoting the rule of law, that are at the top of the foreign policy agenda with Latin America.

Although Germany’s attention and commitment to Latin America has a long tradition, a truly proactive foreign policy towards the region’s countries has generally been limited to short periods. There are several reasons for this. Firstly, it is a geographically distant region, relatively peaceful by international standards, without interstate wars or geopolitical hotspots that would force increased attention. Secondly, problems and issues are arising in Germany’s immediate neighbourhood that have a noticeable impact on the regional power structure or even on Germany itself. Especially in the 1990s and 2000s, following German reunification and the lifting of the Iron Curtain, Germany devoted more attention to Eastern Europe, which was opening up as a new neighbourhood and interesting market. Distant and stable Latin America thus played a subordinate role at that time. Still today, acute problems and more pressing issues for German foreign policy dominate the agenda, which usually leave little room for a prominent engagement with Latin America. This was most recently demonstrated by the global Covid crisis in spring 2020, during which Germany’s foreign policy focus was almost exclusively on its traditional NATO allies and on Asia. Currently, German foreign policy has focused very much on the Russian invasion of Ukraine.

Moreover, Germany regards Latin America as a “natural ally” due to its socio-cultural ties as a Western, Christian-influenced and democratic region. In day-to-day foreign policy, what at first glance would seem to suggest an undoubted closeness and solidarity between Germany and Latin America all too often results in little attention being paid to a partner who is assumed to be on one’s side anyway. In foreign policy boom times, a “natural ally” is a partner you do not have to court in order to be sure of their support in an emergency. As a result, Latin America has moved repeatedly to the margins of the German foreign policy agenda.

There have been – and still are – regular attempts made to counteract this tendency. As early as 1995, the first interdepartmental Latin America concept was created, with the aim of bringing the marginalised region back into focus. The subsequent Latin America concepts of 2010 and 2019 (known as the Latin America Initiative) pursued the same objective.

With reference to the broad common value base, all concepts and initiatives underline the historical and cultural ties between Germany and the region, which are seen as the basis for fruitful foreign policy cooperation in the future. However, while Germany adheres to the instrument of foreign policy initiatives at periodic intervals, much has changed both within Germany and in Latin America. China and other emerging powers have entered the US’s former backyard, and are strategically positioning themselves as new partners in the region, often by deploying considerable financial resources. Many a Latin American country will never forget how quickly China was able to act in the Covid crisis, for example by providing efficient emergency aid in the form of medical supplies. The fact that China’s motives were anything but altruistic and that the relief efforts were part of a global propaganda campaign are ideas that recede into the background for Latin Americans.

However, there have been structural changes in Germany too with regard to Latin America policy: the field of foreign policy has expanded over the decades and now includes more players and policy areas. For Latin America policy, this means that more and more ministries are drafting specific policies towards Latin America, which makes coordination increasingly difficult. As a consequence, Germany often does not speak with one voice with regard to Latin America.

There have been a number of initiatives in recent years to strengthen not only well-established development cooperation, but also genuine foreign policy cooperation, thereby placing relations with Latin America on a more equal footing. With Brazil, for example, with whom Germany has maintained a strategic partnership since 2008, there have been several joint, thematic cooperation projects at the international level and especially within the framework of the United Nations, ranging from a proposal (developed jointly with Japan and India) for reform of the UN Security Council to joint initiatives in the field of international cyber policy. Within this strategic partnership, several joint cabinet meetings were also held until 2016, in order to give symbolic expression to common political goals. With Mexico, on the other hand, cooperation focuses mainly on economic policy issues, such as trade and industry, along with education and innovation. Although there is no formal strategic partnership here, there is a binational commission of the two governments that meets regularly, thus providing a special institutional framework for relations between the countries.

The German business community has always been an important driver of Latin America policy. Since 1994, for example, the Latin America Initiative of German Business (LAI) has promoted economic cooperation with the region, seeking a close alliance with government. Supported by the most important business associations and representatives of German industry, this initiative coordinates and combines German economic interests towards Latin America and initiates specific projects for economic cooperation. Every two years, the group organises the high-ranking Latin America Conference of German Business (LAK), at which companies and politicians meet regularly for a debate on Latin America-related issues and where heads of state from the region present their countries and tryto attract investments. Specific initiatives vis-à-vis important Latin American economic partners, such as the regular German-Brazilian Business Days, and political-institutional mechanisms, such as the Latin America Committee, which manages coordination with policymakers, complete the picture of a structured and targeted economic policy towards Latin America.

As the recurring Latin America concepts and initiatives demonstrate, German foreign policy has recognised the region’s potential. However, the fact that partnership with Latin America and the commitment to a values-based solidarity with Latin America are publicly proclaimed every few years, also illustrates that the region only plays a very subordinate role in day-to-day foreign policy, and that special initiatives are needed to bring the region into focus.

The lack of consistencyin Germany’s Latin America policy is of course, as mentioned above, related to the characteristics of this world region, which is repeatedly pushed to the back burner in the face of more pressing crises, due to its geographical distance, the supposedly low geostrategic relevance for Germany, and the absence of interstate wars.. However, the difficulty of having to actively and repeatedly put Latin America back on the foreign policy agenda also has to do with the orientation of German Latin America policy, because the much-invoked partnership of shared values with the region requires attention or it will fade. Although shared values are a helpful basis for stable intergovernmental relations, they are only the starting point and basis for joint action, but do not yet define the common fields of action or even common interests. A partnership based on values must be underpinned by substance and specific initiatives in order to have real impact; otherwise it will remain an abstraction.

In recent years, German foreign policy has launched a number of initiatives and multilateral cooperation projects with countries in the region, covering highly varied policy areas that range from cooperation on cyber policy issues at the international level, to the establishment of a German-Latin American women’s network. However, the selected areas of cooperation sometimes appear rather arbitrary and eclectic, and do not generally have a long half-life. Moreover, the rhetorical recognition of the region as a partner with shared values that is often found in the context of LAK concepts or initiatives contrasts with the often highly problem-focused reporting of random application of the rule of law, poverty and corruption. If a region of the world is known to the public mainly through negative headlines such as drug trafficking, social inequality or high levels of violence, declaring this region to be a partner in shared values is surprising, and begs the question: What connects us with this region despite the existing shortcomings? What are the advantages of Latin America for Germany compared with other regions of the world?

There is even more of a need for an honest reflection on interests than for a credible communication of the shared-values partnership at home and abroad. Constant reference to the cultural and values-based partnership sometimes creates the impression that Germany and Latin America do not actually share any strategic interests. A sober analysis of German interests in Latin America and of common interests at regional and international level is required in order to better exploit the potential of the partnership.

Beyond idealising and generalising about an entire world region, German Latin America policy needs to spell out what the individual partnerships are supposed to be about: what interests does Germany have in the region and where? Which partner is best qualified for realising these interests?

The following sections on individual countries give a summary of five partner countries in Latin America that are particularly suitable for realising the core German interests of values, prosperity, security, resources and migration. They are not the only countries in the region that make suitable partners, but rather represent a selection of countries that have intrinsic potential for intensifying bilateral relations in these specific areas with their particular relevance for Germany.

A whole range of countries in Latin America offer themselves as potential partners, in particular for the first field of interest, namely that of strengthening a values and rules-based world order. In addition to our examples Uruguay and Chile, which are obvious candidates as partner countries for this particular area of interest, because they have enjoyed an impressive stability in their political and socioeconomic situation for a long time and could well be regarded as role models for the region,traditional partners such as Argentina, Brazil, Mexico and Colombia do, of course, play an important role. Countries such as Costa Rica, Ecuador, El Salvador, Guatemala, Honduras, Panama, Paraguay and Peru, which have a strong self-interest in a values and rules-based world order, because it guarantees them sovereignty under international law vis-à-vis more powerful countries, also offer prospects as potential German partners for implementing this core foreign policy interest.

There are also many potential partner countries in Latin America for realising the interest in safeguarding our prosperity via free trade and innovation. Chile, Costa Rica, Colombia, Panama or Peru, for example, advocate market economy principles in international trade through their free-trade-oriented foreign trade policies, or are – like Argentina, and our selected case studies Brazil and Mexico – G20 members and important manufacturing locations for German companies.

In terms of international security and the stability of Europe, Latin America generally plays a somewhat minor role, due to its geographical distance from Europe and its considerable stability. The region is characterised by largely peaceful interstate relations, relatively low military expenditure, and the ban on nuclear weapons agreed in the Treaty of Tlatelolco. In contrast to many other regions of the world, Latin America is therefore a haven of peace and stability, but does not play a central role in international security policy for this very reason. However, there are a number of Latin American countries that, along with their immediate neighbours, actively support peaceful conflict resolution, diplomatic settlement and security policy integration in the region, thus ensuring that Latin America’s stability is maintained in the future. This applies to countries such as Argentina, Chile, or Panama, as well as to the case studies Brazil and Colombia. Brazil plays an important security policy role in the region as a regional leader and G20 member, Colombia has major relevance as a key host country for migrants and refugees from crisis-torn Venzuela.

In terms of securing essential natural resources and protecting the climate, however, Latin America is a key region. Especially South America , which boasts the largest contiguous rainforest area and the greatest biodiversity in the world in the Amazon rain forest, is a key player when it comes to global efforts to protect the climate. Due to the enormous wealth in mineral and agricultural resources (e.g. oil, lithium, iron ore, soya and beef), the region also plays a central role in supplying and securing important commodities. Countries such as Argentina, Bolivia, Brazil, Chile, Ecuador, Colombia, Mexico and the case studies Costa Rica and Peru are suitable partners for these key issues of the future.

Last but not least, a number of Latin American countries are also important partners in regulating global migration flows. Although the region does not seem to have the same immediate importance as North Africa or the Middle East because of its distance from Germany and Europe, South America is currently experiencing one of the biggest refugee disasters of our time due to the crisis in Venezuela. Most of the now roughly 6 million refugees from Venezuela were taken in by the surrounding countries, especially by Venezuela‘s neighbour Colombia. But even in Europe, Venezuelan refugees already represent the second largest group of asylum seekers. In addition to Colombia, which was chosen as a case study due to its enormous efforts to integrate neighbours seeking help and protection, a number of other countries, such as Argentina, Brazil, Chile, Costa Rica, El Salvador, Guatemala, Honduras, Mexico and Panama are playing an important role as countries of origin, transit or even destination for migration flows.

Overall, Latin America is a reliable partner in the pursuit and implementation of core German foreign policy interests. Depending on the respective subject area, different countries are particularly suitable as partners and deserve a closer look. The following case studies, each of which presents a country in the region as a partner for implementing Germany’s foreign policy interests, are designed to provide illustration and guidance in the search for partners among the 33 Latin American and Caribbean countries.

Jan Woischnik is head of the section “Latin America” in the European and International Cooperation Division.
Christina Stolte was policy advisor for “Andean Countries“ in the European and International Cooperation Division and has headed the KAS office in Bolivia since early 2022.

Last update: 9 May 2022

SHOW LESS

BRAZIL

as a partner for safeguarding our prosperity via free trade and innovation

Brazil is the largest economy in Latin America and, with a GDP of approximately 1,5 trillion US dollars, is one of the most important emerging markets in the world. The country has a domestic market of 214 million inhabitants and is rich in natural resources.

BRAZIL

as a partner for the security and stability of Europe, its neighbourhood and other regions of the world

Brazil is the largest country in South America, the fifth-largest country in the world, and the largest economy in Latin America. It also accounts for more than 60 percent of the Amazon tropical rainforest, the world’s largest, and includes a large proportion of renewables in its energy mix. The country’s geographical location, size, economic significance and the importance of preserving its natural resources in the fight against the global climate crisis all underpin the central role Brazil plays in ensuring and maintaining global climate, energy and food security.

COSTA RICA

as a partner for securing essential natural resources and protecting the climate

Costa Rica generates nearly 100 percent of its electricity consumption from renewable energy sources. The country is also considered a leader in nature conservation. More than 25 percent of Costa Rica’s land is devoted today to nature conservation areas. With its Decarbonisation Plan, adopted in 2018 with an implementation deadline of 2050, the country is setting important standards and leading the way both regionally and internationally.

COLOMBIA

as a partner for regulating global migration flows

According to official data from the Colombian migration authorities, approximately 1.8 million of the more than 4 million Venezuelan migrants are currently in Colombia.Commuters and so-called “transit migrants“ are not included in these statistics, which means that their actual number is probably even higher.

MEXICO

as a partner for the security and stability of Europe, its neighbourhood and other regions of the world

In connection with organised crime, drug trafficking, and the infiltration of the state by criminal groups, Mexico – a regional leader and member of the G20 – is facing major challenges that affect both internal and regional security. In view of the cross-border effects of organised crime in Mexico, which extends far beyond the American continent, migration from Central America and other regions of the world through Mexico towards the USA, the significant economic potential as a manufacturing base offering a well-qualified workforce and privileged access to the US market via the North American Free-Trade Area, Mexico is of great importance for the stability of the region.

PERU

as a partner for securing essential natural resources and protecting the climate

Peru is an exception in Latin America in terms of its enormous wealth in resources and biodiversity. The third largest country in South America is characterised by three large landscape zones: the coast, most of which is covered by desert, the Andes and the jungle region. According to the World Resource Institute, Peru is one of only eight megadiverse countries in the world, possessing 84 of the 104 existing life zones. About 60 percent of the country is covered by rainforest, which means that the country has the largest share of the Amazon rainforest after Brazil.

URUGUAY

as a partner for strengthening a values and rules-based world order

In comparison to other Latin American countries and despite its modest size, Uruguay serves as a model in view of  its impressive political and socio-economic achievements . In a region that is not always stable, the country can look back on a long democratic-republican tradition with functioning institutions and a diverse media landscape. According to the latest edition of The Economist‘s Democracy Index, Uruguay is currently the most democratic country in Latin America and is ranked 15th worldwide.