In its strategy to overcome Brexit and gain influence in the world as an individual power and not integrated in the European Union, Britain hardly looks at Latin America. In the 19th century, the region was enormously important to him and it occupied the place of reference that Spain had left after the independence of its American colonies, until, with the beginning of the 20th century, the United States extended its hegemony to the rest of the continent. In this 21st century, the United Kingdom cares more about Asia, where the great economic expansion of the world is taking place, and Africa, where it tries to recover the ancestry it had as an imperial metropolis.
The long document ‘A Global UK in a Competitive Era’, which collects the
new national strategy known as “Global Britain”, only contains two short paragraphs, already well advanced in the text, dedicated to Latin America. London prioritizes its relationship with the Euro-Atlantic environment in which it finds itself (USA, Canada and the rest of Europe), the Indo-Pacific region and East Africa.
From Latin America, the British strategic document highlights its natural resources (23% of tropical forests, 30% of freshwater reserves and 25% of arable land), which can form the basis for a greater relationship with the region. It also points to your desire for increased trade mainly with Brazil and Mexico, as well as with Argentina, Chile and Colombia. And as a third element, London also points to its interest in preserving British sovereignty over the Falkland Islands (Malvinas), South Georgia and the South Sandwich Islands. On this, he points out that the United Kingdom “will continue to ensure that the interests of the 3,500 people who live there are protected in line with the principle of self-determination.”
Precisely, the situation in which the Falklands are left worries London, since in recent years these islands have been exporting products to the EU, basically fish, worth more than 200 million euros. That trade is expected to decline, since it is now affected by the tariffs that Brussels imposes.
Free trade agreements
The United Kingdom has established free trade agreements with various Latin American countries that already had such a deal with the European Union, so that the negotiation has been quick. On January 1, 2021, when the British separation from the EU came into force, Great Britain’s free trade agreements with Mexico and Chile, with the Andean Community bloc (Peru, Ecuador and Colombia, a country in which the application has had some delay) and with Central America (Guatemala, El Salvador, Honduras, Nicaragua, Costa Rica and Panama). The same happened with fourteen Caribbean countries that, associated as Cariforum, they already had that relationship with the EU, including the Dominican Republic. This means that a third of the 66 free trade agreements with non-EU countries that the United Kingdom launched with the implementation of Brexit have been signed with the Latin American and Caribbean region.
However, London has not yet been able to establish a similar deal with Mercosur (Brazil, Argentina, Uruguay and Paraguay), since the agreement signed between that bloc and the EU has not yet been ratified by its members, so its viability or aspects of its contents are in question. But, in addition, the internal crisis that Mercosur is experiencing over the establishment of new trade agreements calls into question an early pact of that group with the United Kingdom.
On the other hand, London will not be able to fulfill its wish to join the North American free trade agreement. Although it has agreements separately with Canada and MexicoIt does not have it with the US Furthermore, the other two countries would hardly be willing to dilute their close relationship with their US neighbor with the entry of a fourth partner. Greater prospects has the British intention to join the Trans-Pacific Economic Cooperation Agreement, where it can strengthen trade with Chile, Peru and Mexico, which are part of that group.
Possibilities: food and insurance
Without being Latin America a strategic priority for the United Kingdom in the post-Brexit, experts from the British think tank Chatham House have recently pointed out that the region offers commercial possibilities of interest for London. On the one hand, the United Kingdom had been importing from the EU 74% of the agricultural and livestock products that arrived in the country (98% of dairy products and eggs and 83% of meat), which gives a margin of growth for supply now from other parts of the world due to less trade with the EU. In 2018, only 1.8% of agricultural products imported by the United Kingdom came from Brazil and Argentina, which are large producers.
On the other hand, London hopes to increase the export of its financial services to the region, especially in terms of insurance and pensions. In 2020, the largest buyer, which was Brazil, only acquired 0.4% of the financial services exported by the British, with a total of 1.1 billion pounds.
George is Digismak’s reported cum editor with 13 years of experience in Journalism