President Alberto Fernández and European Commission head Ursula von der Leyen signed a memorandum of understanding to expand cooperation between Argentina and the European Union regarding sustainable value chains of critical raw materials. The goal of the agreement is to guarantee a steady and sustainable supply of commodities needed to ensure the energy transition. 

The agreement was signed in Buenos Aires during Von der Leyen’s trip to four Latin American nations, which is intended to bolster political and trade ties the European Union admits it has sometimes neglected. She has already been to Brazil, and Chile and México are next on her agenda. 

The European Commission head expressed her satisfaction with the agreement. “This is very beneficial for all parties involved. It’s a great step forward for the EU’s climate ambitions, and it’s beneficial for Argentina, as a key world actor in the global energy transition. A partnership based on shared commitments for a more ecological, digital and resilient future for all,” she said. 

The memorandum also looks to support the creation of local added value, quality jobs and sustainable and integrated economic growth for both parties. The main points of the agreement are:

• Value chain integration of sustainable critical raw materials
• Cooperation in the fields of research and innovation, especially in mineral knowledge, minimization of climate footprint and circular economy
• Cooperation to follow government, environment and social criteria in line with international regulations
• Set in motion infrastructure to develop projects, while minimizing environmental and climate impact
• Strengthen professional development within the value chain of critical raw minerals, in line with international labor laws 

Since Russia’s invasion of Ukraine, the European Union has cast around for “like-minded” trading partners and sources of critical minerals required for its green transition, to help reduce its reliance on China.

One item high on Von der Leyen’s agenda, the EU-Mercosur trade agreement struck in 2019 and put on hold largely due to concerns over Amazon deforestation, was addressed in the EU-Argentina Business Forum on Tuesday. In the opening speech, Euro Chamber president Giorgio Alliata di Montereale said that closing the deal is “critical”, since there is a risk that other conflicting agreements could be made due to the delay. 

The EU is expecting a Mercosur response soon to its proposal to attach sustainability and climate change commitments to the deal.

Von der Leyen will also seek to push forward an update to the EU-Mexico trade pact which the two sides agreed in 2018.

-with information from Reuters