Latin America, the agro-energy-mineral powerhouse: The road to a sustainable transformation economy?

Latin America and the Caribbean (LAC) is a growing agro-energy powerhouse. Coming out of the more digitized, less global and ‘richer and poorer’ pandemic, the question we ask ourselves is what will the role of LAC be in the world economy? And how will LAC provide this privileged position to resume its sustainable growth that is inclusive and increases the well-being of the population in a world polarized between higher concentration of income and increasing poverty?

The numbers show that the evolution towards a less global and more local world makes regions focus on their vocations and boost their competitiveness. In the evolution of the world economy, it is shown that countries that have invested in their vocations have better results per dollar invested and faster and more resilient responses to crises.

LAC has demonstrated its vocation in recent decades, through an extraordinary evolution in its agribusiness. South America for decades has shown the best world productivity per hectare, especially in extensive crops. This fact shows that science and technology, combined with innovation and entrepreneurship, can make the region the largest food exporter in the world. What used to be made with wheat and corn from the United States and Russia is now being replaced by soybeans and other grains. This, combined with the production of animal and vegetable proteins, has made the region a sustainable competitor on a large scale in the world. Local development, measured in terms of quality of life, has exponentially increased well-being. On the other hand, the production of smaller-scale special products such as fruits, coffee, cocoa, as well as processed products such as salmon, wines, flowers, among others, show that medium and small companies grouped in cooperatives have reached highly sophisticated markets. 

The minerals industry, due to their abundance and strong demand, is increasingly moving towards special materials, with rare soils. Exports of these raw materials increase not only in volume, but in quality, according to ESG sustainability principles. Democracy, a free press, and active NGOs give transparency and credibility to these processes. However, the export of minerals, which on the one hand is welcome, but on the other hand does not give the assurance that it will distribute its wealth well, due to its concentration necessary to ensure scale and productivity. LAC faces the challenge of increasing the sustainable value of its raw materials. The most obvious way is to add renewable energy to the process, decarbonizing the product; this can help but is not enough. The production chain for mineral processing in LAC will be the challenge of the century. Realistically this will be one of the most difficult but necessary strategies. The concentration of income from raw materials, in the hands of large public or private companies, leaves the local economy vulnerable to the distributional policies of the State, which is a huge risk. State intervention is of greater risk if it is decisive for the distribution of income either through benefits (Venezuela, Bolivia) or through taxes or prices (Chile, Brazil).

The search for niches based on these raw materials, through innovation, cooperativism and international cooperation is a necessary way to ensure social welfare.

It is already a fact that LAC can become an energy powerhouse. The growth of generation, transmission and distribution is incredible if we consider the participation of sustainable energies in the matrices. It already has the best indexes in the world, by region and by country. If we separate electrical energy in the general matrix, the participation rate for sustainables is higher than two thirds of all electrical energy. The innovations in this area do not stop; solar, wind and biomass energy are in exponential evolution of productivity and efficiency. The integration of these energies helps to reduce the intermittency of these sources. The latest hotspot now is the exploration of hydrogen and LAC becomes an investment option for green hydrogen, starting from the electrolysis of clean energies, not only for local use, but for export. In mobility, LAC presents the options for hybrid or non-hybrid flex-fuel, with less CO2 per kilometer driven.

The challenge in these policies to take advantage of the vocation and potential of Agro-Mineral-Energy is not only to do the obvious, for ASG. But what is not obvious is knowing exactly how to develop a policy of economic transformation that is participatory, so that the majority of the population develops their well-being. Taking advantage of medium and small companies in these answers is essential! They employ more than three-quarters of the region’s workers.

In addition to having a policy oriented to our obvious potentials, the available digital technologies must be used to promote knowledge, professional skills through education and training available worldwide.

More effective regional integration should allow the sharing of best practices in education, health and public services through smart digitization. If we had a shared digital system so that children, youth and adults, professionals of any activity, could educate themselves by downloading the available applications to learn what they need, would we not include a population eager to develop?

We have extraordinary examples of “best in class”: distance education; telemedicine systems with extraordinary remote diagnostic power; last mile logistics; vocational training at all levels; fintechs; public services. All of this was tested during the pandemic. If we selflessly become local and share experiences and knowledge, we will be unbeatable!

It is up to us to explore these opportunities, which are more than ideas, they are visions for a region of enormous potential and they are ready to be applied. It is up to the productive sector of the region to mobilize for these transformations, not fixed in ideologies, but in possible realities. Politics will move with the force that entrepreneurs wield solutions for a democratic, open, free and committed Latin American society; who does not want to leave anyone behind in our families, in our businesses, in our communities, in our countries and regions.

Together for an America without borders, for all for a better shared life, an obligation of committed leaders. Are you part of it? So get to work …

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