Ranil Jayawardena, Minister for International Trade, explains how ‘Global Britain’ can support Latin America’s clean energy transition in the wake of the pandemic and create opportunities for UK plc…
When he laid the first ever trans-Atlantic telegraph cable linking Europe with Latin America 150 years ago British engineer William King helped unleash a great surge of economic energy between our two continents. This electric bridge of commerce turbocharged the speed at which business could be done – cutting communication times from the trading floors of Lisbon – and soon London – to the leather merchants of Buenos Aires and the iron ore exporters of Rio De Janeiro from weeks by ship to minutes by telegraph.
The Brazilian Emperor was so delighted with this technological marvel that he knighted King for his work. Not bad for a man more comfortable beavering away in his office designing clocks than mixing with royalty!
And as we embrace the fantastic opportunities ahead as the world resets, rebuilds and recovers in the wake of the Covid-19 pandemic, we want the United Kingdom to build new bridges of commerce with our friends and partners in Latin America and the Caribbean, forging closer trade and investment ties across this vibrant, fast growing region. Not least in the new technologies that are key to creating cleaner, greener, more sustainable and more resilient economies fit for the future.
We know it remains a region that is unfamiliar to many British businesses today. But, with over 600m people, massive natural resources and a fast-growing middle class, its nations offer enormous export and investment opportunities for those firms with the energy, ambition and determination to take them.
And, as we build a truly independent, outward-looking, Global Britain who champions the cause of free trade on the world stage, it is crucial that we help drive further export growth between the United Kingdom and our Latin American and Caribbean partners in the years ahead.
In 2019, total trade between Britain and the region was worth more than £31billion, an increase of over 8% on the year before. Even so, we know British businesses have the potential to achieve so much more in this region, which offers some of the most diverse, exciting and dynamic development opportunities anywhere on the planet. From tech to transport, financial services to pharmaceuticals, advanced manufacturing to artificial intelligence, the appetite for world-class British products and services is growing across Latin America and the Caribbean.
“In 2019, total trade between Britain and the region was worth more than £31billion, an increase of over 8% on the year before…”
Investment in critical infrastructure is central to driving growth across this region – with governments committing unprecedented sums to strengthening and diversifying their transport, health and energy mix in the wake of Covid-19. Britain possesses the world-class capabilities in design, logistics and project management that are perfectly suited to helping partner these countries – and the opportunities for growth are huge.
Earlier this year the Government of Chile announced $34billion-worth of funding for new transport infrastructure projects over the coming decades, while the President of Peru unveiled a further $14billion investment in key in transport, water and social infrastructure schemes across his nation. The United Kingdom signed a government-to-government agreement last year to partner Peru in rebuilding its critical infrastructure following the devastation wrought by El Nino in 2017 – and, over the next two years, a British delivery team will work together with Peru’s Reconstruction Authority to help renew their health, education and water management capacity.
Colombia, Brazil and Mexico are also taking forward ambitious flagship projects of their own: from wastewater treatment plants in Bogotá and Rio de Janeiro to the modernisation of three airports surrounding Mexico City – offering further exciting opportunities for British businesses. And with our green tech firms at the vanguard of the clean-growth revolution that is sweeping the planet, we want to partner nations around the world in harnessing the massive growth potential this change represents.
From offshore wind to biogas, to energy capture and storage the opportunities for cooperation in this field are vast, with the International Finance Corporation estimating investment potential for sustainable transportation in Argentina, Brazil, Colombia, and Mexico alone at over $2.6trillion by 2030. From healthcare, to education, to transport, LATAC nations are spending billions on upskilling their workforces. And it’s work that British providers are ideally placed to support.
And we are working with governments across the region to remove obstacles to trade – and opening access to each other’s markets – cooperation that will accelerate further over the coming year. We have already secured preferential trade arrangements between Britain and 24 Latin American and Caribbean countries. And we’ve only just begun.
We continue to discuss a future agreement with Mercosur and have signalled our intention to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) – which will strengthen our links to Mexico, Peru and Chile, its three Latin American members. Meanwhile, the trade agreement we have signed with the European Union has brought continuity for British firms and will enable us to take full advantage of our new role as an independent trading nation on the global stage, striking even more trade deals around the world.
It’s about investment too. We are working to increase bilateral investment and simplify public procurement across the region and British businesses are already reaping the benefits – with Colombia’s Double Taxation Agreement, for example, reducing the costs of doing business in that market for our firms. And, in Guyana, we are supporting companies working on projects worth more than £200m in industries such as renewable energy, infrastructure, healthcare and education.
The Department for International Trade’s team of expert advisors based around the world – and across LATAC – are providing the support and advice British businesses need to connect with new customers and commercial partners. And our community of Regional Export Champions in Britain – all successful businesses themselves – are passing on their vital experience and advice to budding exporters here who are looking to build new links overseas.
“our green tech firms at the vanguard of the clean-growth revolution that is sweeping the planet…”
In addition, our export credit agency UKEF is working to make sure that no viable British export fails through lack of finance – providing the backing British firms need to take that first step into exporting or increasing their trade overseas. UKEF’s risk appetite for Jamaica has recently increased by 200%, for Paraguay by 220% and, for Bolivia, the Dominican Republic and Honduras it has climbed 300%, signalling our determination to forge new bonds of prosperity with our partners.
As nations across this fantastic region transform their economies over the coming years, we are determined that British businesses will be front and centre in providing the skills, products and services they need to help achieve their ambitions. Because it is only by forging closer ties with dynamic markets like this, that we can hope to fully harness the creativity, entrepreneurial energy and expertise the United Kingdom possesses in such abundance.
So, let’s follow in the footsteps of William King and build new trade and investment bridges with Latin America and the Caribbean as we move into a golden new era for global commerce – creating cutting-edge business links that drive growth, foster innovation and energise the exchange of skills, capabilities and expertise between us in the years ahead. I’m sure King would have approved of this great endeavour – let’s embrace it together.