Christian Asinelli: “It is a historical hypothesis to bring Portugal and Latin America closer together”

How are the trade relations between Latin America and Europe, especially Portugal?

Europe remains a relevant partner for most of our economies, the second or third partner in most Latin American and Caribbean economies, and there is also great relevance for investment. Historically, Europe has been an important foreign direct investor, generating employment and knowledge transfer. And Covid has reached consensus on the need to align global efforts with a sustainable development agenda that responds to social and environmental challenges. We are called to play a role in recovery but also in the digital agenda and there are important opportunities for cooperation in areas such as climate action, biodiversity conservation and technological development in the coming years. Latin America plays a vital role as a supplier of natural resources for energy, construction and innovation and will continue to play a key role in the transition to greener and more digital economies. We have one of the cleanest energy matrices in the world and potential for renewables, in addition to natural resources essential to this commitment, as well as the traditional resources needed during the transition process. This scenario promotes the strengthening of relationships. We can be part of the solution to the energy challenges and even as a food supplier to Europe in the context of the war in Ukraine.

What development opportunities do you see?

For example, areas such as renewable energy, environment, management of water and fixed resources, modernization of production processes to reduce the carbon footprint, electrification of transport, development of Industry 4.0 and boosting the digitalization of SMEs, as well as in agriculture and the tourism area is sustainable, forests, coasts and urban spaces offer opportunities.

And in the specific case of Portugal?

Latin America, the Caribbean and Portugal have a historical relationship that is even reflected in migratory flows, political dialogue and wide-ranging exchanges. Traditionally, commercial and investment relations with the country were linked to Brazil, but today there is a historic opportunity to bring Portugal, Latin America and the Caribbean closer together and allow CAF (the region’s development bank) to collaborate and benefit from themes in the meantime in that Portugal has extensive experience such as water and sanitation, solid waste management, climate action and digitalisation, but also the development of SMEs and agrologistics centers, etc. Portugal has become a country that attracts a lot of FDI and again Brazil plays a role here, but it could be extended to the rest of the region, making the country a gateway for Latin American companies to the European market. There are all the conditions to consider a strategic partnership between Portugal and Latin America, focusing on the major global challenges, on the opportunities our region has for Portuguese companies and on the Iberian advantages as a gateway to Latin America and the Caribbean area.

What role can an investment bank play in this?

Covid has highlighted the importance of multilateral development banks in times of need and contributed in a flexible and definitive way to respond to the needs of countries. CAF immediately established support lines, provided liquidity to basic service providers, SMEs and helped strengthen health and social protection systems. And we must continue to support countries in the return to fair and sustainable growth, i.e. to a rapid recovery, but which benefits from the lessons of the past and is sustainable, improves the productivity and competitiveness of the region and the resulting structural differences compensates for access to infrastructure, education, inequality and poverty. CAF can play a fundamental role as a bridge between the European Community and Latin America and the Caribbean to channel resources that streamline environmental and social agendas, strengthen commitment to infrastructure and encourage alliances with public and private entities. We want to be a strategic platform that enables and stimulates international cooperation for a recovery and development agenda focused on the green, sustainable and digital economy. And Portuguese companies can make a very important contribution to these CAF objectives in the dialogue between regions and in the implementation of projects.

Is the energy transformation for decarbonization an important pathway in these relationships?

Our region has the largest oil reserves after the Middle East and holds 4.2% of the global gas reserves. It is also where more hydroelectric power is produced in the world and in the recent logic of electrification of economies we have the best conditions for wind power generation, namely in Patagonia, while in the north of Chile and the south of Peru there are extraordinary circumstances for solar energy. On the other hand, Argentina, Bolivia and Chile have the largest lithium reserves in the world, estimated at 64% of the total. Now that the energy transition and decarbonising the economy are a priority and much remains to be done to make our cities more efficient, there are incredible opportunities. And CAF wants to be a partner for countries to achieve these goals, with Europe playing a role in guiding the region.