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Global Gateway: EU and Argentina step up cooperation on raw materials

Jun 13, 2023 , , , , , ,

Brussels, 13 June 2023
Today, in Buenos Aires, Commission President Ursula von der Leyen and the President of Argentina, Alberto Fernández, signed a Memorandum of Understanding establishing a partnership between the EU and Argentina on sustainable raw materials value chains.

In line with the EU’s Global Gateway strategy, the agreement aims to ensure the development of a secure and sustainable supply of raw materials necessary for the clean energy and digital transition. It also aims to develop a sustainable raw materials industry, and to support the creation of local added value, quality employment and sustainable and inclusive economic growth, to the mutual benefit of both sides.

President of the Commission, Ursula von der Leyen, said:

“I am glad to sign this partnership between the EU and Argentina for the development of sustainable raw materials value chains. This is truly win-win. It is a big step forward for the EU’s climate ambitions and it is beneficial to Argentina as a key global player in the clean energy transition. A partnership based on shared commitments to a greener, digital and more resilient future for all.”

The partnership is centred around five areas of collaboration:

  • Integration in the sustainable raw materials value chains, including through joint development of projects, new business models, promotion and facilitation of trade and investment linkages;
  • Cooperation on research and innovation along the raw materials value chains, including on minerals knowledge, the minimisation of environmental and climate footprint, and circular economy;
  • Cooperation to leverage environmental, social, and governance (ESG) criteria and align with international standards;
  • Deployment of hard and soft infrastructure for projects development, minimising their environmental and climate impact;
  • Strengthening capacities, vocational education and training and skills development along sustainable raw materials value chains in accordance with international labour standards.

The EU and Argentina have committed to develop an operational Roadmap within 6 months of the signature of the Memorandum of Understanding. The Roadmap will include cooperation actions that will be carried out by relevant stakeholders from the EU Member States and Argentina and will be supported by the EU’s Global Gateway Investment Agenda for Latin American and the Caribbean strategy.

Background

Critical and strategic raw materials are indispensable for a wide set of strategic sectors including the net-zero industry, the digital industry, aerospace, and defence. As demand for critical raw materials is projected to increase drastically, Europe still heavily relies on imports, often from quasi-monopolistic third country suppliers. The EU needs to mitigate the risks for supply chains related to such strategic dependencies to enhance its economic resilience, while achieving its climate and digital objectives.

The proposal for a Regulation on Critical Raw Materials leverages the strengths and opportunities of the Single Market and the EU’s external partnerships to diversify and enhance the resilience of EU critical raw materials supply chains. The Critical Raw Materials Act also improves the EU capacity to monitor and mitigate risks of disruptions and enhances circularity and sustainability.

The Commission has already started working to build strategic partnerships with resource-rich third countries, making use of all external policy instruments and respecting its international obligations. The EU will work with reliable partners to promote their economic development in a sustainable manner through value chain creation, while also promoting secure, resilient, affordable and sufficiently diversified value chains for the EU.

The Commission has already established strategic partnerships on raw materials with Canada (June 2021), Ukraine (July 2021), Kazakhstan and Namibia (November 2022), on behalf of the EU. The partnerships allow both sides to advance trade and investments into secure, sustainable and resilient raw materials value chains, which are key to achieving the transition to climate-neutral and digitalised economies.

For More Information

Memorandum of Understanding

Quotes

I am glad to sign this partnership between the EU and Argentina for the development of sustainable raw materials value chains. This is truly win-win. It is a big step forward for the EU’s climate ambitions and it is beneficial to Argentina as a key global player in the clean energy transition. A partnership based on shared commitments to a greener, digital and more resilient future for all.

Ursula von der Leyen, President of the European Commission – 13/06/2023

With this Memorandum of Understanding on raw materials between the EU and Argentina, we embark on a mutually beneficial partnership that advances our ambition to secure sustainable supplies and diversify critical resources. This significant step reinforces our commitment to reinforcing robust and resilient economies on both sides of this partnership. I am confident that it will yield great benefits for all parties involved, supporting resource cooperation and fostering growth for our economies.

Thierry Breton, Commissioner for Internal Market – 13/06/2023

This agreement is a testament to the mutually beneficial partnership the EU and Argentina want to build together under Global Gateway. We are enhancing each other’s strategic autonomy on a crucial sector, while supporting progress towards the Sustainable Development Goals. Critical raw materials are key to drive forward the fair, green and digital transition, and we want to obtain them in a sustainable way that creates local added value and enhances social cohesion. The EU will support the roll out of this important partnership launched today through the Global Gateway Investment Agenda for Latin America and the Caribbean.

Jutta Urpilainen, Commissioner for International Partnerships – 13/06/2023
Source – EU Commission

Statement by EU Commission President von der Leyen at the joint press conference with Argentinian President Fernández

 

Brussels, 13 June 2023
Mr President,

I am very glad to be in Argentina today. Indeed, we share deep, historical and cultural ties. We are long-standing friends. We share the same values. First of all, I want to congratulate you on this important anniversary of 40 years now during which you have built a vibrant democracy.

Argentina knows better than anyone how vital it is to protect hard-won political rights and freedoms. We want to thank you for having expressed your unwavering support to Ukraine from the very beginning, also in view of the precious values of the international law and the UN Charter that have been violated by Russia’s war of aggression. We know that the impact of Russia’s war of aggression goes well beyond Ukraine’s border. It affects the global economy, the energy markets, the food security, interest rates. But as I said, it is also a severe threat to the principles of international law and the UN Charter. Here, we thank you for your steadfast support. As like-minded partners, we need to stand together to protect the international order.

We do not only share the same values, we are also trusted economic partners. Our regions are partners of choice. And we think it is time to take this partnership to the next level. Last week, the European Union put on the table our Latin America strategy. It is a new agenda to strengthen relations between Europe and Latin America and the Caribbean, and to join forces to tackle global challenges. You know them: It is climate change, digitalisation, reliable supply chains that we need, economic resilience that is necessary, but also strengthening our institutions and defending the rules-based order. The Latin America strategy is also coming with substantial new investments – we spoke about it. The European Union is indeed already the top investor in the region. And I am very glad to tell you that we will step up further.

For that, we have Global Gateway, that is our investment plan for infrastructure abroad. Through Global Gateway, the European Union will invest EUR 10 billion in Latin America and the Caribbean. This will be complemented by additional contributions from the Member States bilaterally and of course by private sector investment. Global Gateway creates a conducive environment for private investments from across Europe in Latina America and the Caribbean, and specifically here in Argentina.

So today, we discussed how to take our economic partnership forward. Indeed, the first topic we engaged on was thriving trade relations between Argentina and the European Union. The European Union is sharing around 40% of foreign direct investment here in Argentina. And we think we can go much further. And here comes the EU-Mercosur agreement into play.

The role of the Mercosur agreement is to unleash untapped potential. It will help to further integrate and strengthen our value chains. We want to bring regulatory predictability to make more investments flow. We want to help our industries to innovate together and stay competitive globally. And we will also support your aim to create a more resilient economy. That would make our partnership even stronger. So indeed, I hope we can get the EU-Mercosur agreement across the finishing line. We have exchanged a first letter. We are waiting for a response. And we are very much looking forward to working as hard as possible so that we conclude this agreement, a win-win agreement. For that, we encourage our staff to work as fast and as hard as possible so that we really make progress on that topic.

The second topic, indeed, is critical raw materials. We have just signed the Memorandum of Understanding on critical raw materials. This is a great step forward, and we will both benefit from it. I think it is important to see that, for example on lithium, we will help develop value chains that definitely go beyond extraction. Because we think it is so important that the added value in the processing value chain stays locally and in the region, so here. Because then this creates good jobs and business opportunities right here in Argentina. Lithium plays a big role because it is essential to power clean technologies. It is basically everywhere: it is in batteries; it is in wind turbines. And as the whole world is embarking on these clean technologies to fight climate change, the demand for lithium will grow significantly, not only in Latin America but across the whole world. And this is the opportunity for Argentina to develop this sector with the value chains. I will give you a figure from Europe: The European demand for lithium will – that is what we expect – be 12 times greater by 2030 than it is today because of the factors I was mentioning. So the MoU we have just signed but also the EU-Mercosur agreement will make crucial investment flows possible. Investments in high-quality, sustainable infrastructure that can give a significant boost to the economy.

Indeed, the next topic that we have been discussing was the green transformation that we are undergoing, and here with view on energy. Argentina has immense potential for renewable energy – solar but also wind power for green hydrogen, for example. You are on your way to become a regional hub for renewables, with the support of Global Gateway. And I think this is good news for both of us because it will accelerate your clean energy transition, it will create jobs here in Argentina. And of course, it is also of high interest for the European Union, as we need a reliable clean energy supplier.

So let us conclude by saying that our partnership is strong and trusted. I am very much looking forward to seeing you in Brussels, hopefully soon at the EU-CELAC Summit. And I look forward to the work that we have ahead of us.

Thank you very much.

 

 

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