Making Better Use of Potential

Economic cooperation with Latin America offers considerable potential. In response to this growing importance, the BDI established the Latin America Committee of German Business (LADW) in 2015, which brings together leading representatives of well-known companies with a strong interest in Latin America.

Latin American markets show strong demand for German products, services, investment, financing and know-how. Yet Germany’s economic engagement in the region remains below its potential. Compared with major competitors, Germany is still not sufficiently present in the region. This is not only an issue for companies, but also for Germany’s broader strategic positioning. China and the United States remain highly active in Latin America, while Europe and Germany are increasingly expected to make more concrete offers for cooperation, investment and partnership.

The provisional application of the EU-Mercosur Interim Agreement, effective May 1, 2026, creates an important framework for deepening economic relations with Argentina, Brazil, Paraguay, and Uruguay. The agreement reduces tariffs and trade barriers, opens up new business opportunities, and improves predictability for companies. For German industry, this is particularly relevant in sectors such as mechanical engineering, automotive, pharmaceuticals, public procurement, services, and critical raw materials. At the same time, the agreement sets important standards for sustainable development, labor rights, and climate and environmental protection.

The modernized EU-Mexico Agreement also gives new momentum to relations with Mexico, Germany’s most important trading partner in Latin America. It is intended to improve market access, remove trade and investment barriers, facilitate access to public procurement, and strengthen cooperation in areas such as sustainability, critical raw materials, and digital trade.