The South America Issue of Germany

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German Chancellor Olaf Scholz visited various South American countries between 28 January-1 February.[1] These visits by Scholz are closely related to the energy crisis caused by the Russia-Ukraine War. In this context, Scholz seeks to ensure that Germany has access to alternative energy sources by strengthening its transcontinental relations. Thus, Germany’s energy dependence on Russia will decrease. The African and Asian expansions initiated by the Chancellor in 2022 were the first steps taken towards this goal. In the new year, it tries to increase the number of regions it cooperates with by including South America in its initiatives in Germany, Africa and Asia.

While possible cooperation in the energy sector is the main theme of Scholz’s South America visit, the parties are likely to consult on many issues. In this context, before the visit, Scholz emphasized that Germany wants to develop its relations with South America and the Caribbean in renewable energy, green hydrogen technology and raw material trade in a prudent manner.[2]

In addition, it can be said that socioeconomic transformation is also discussed within the framework of the common interests brought about by climate change and sustainable development goals.

In addition, it is expected to act as a catalyst for Germany to participate in sanctions against Russia by operating in Argentina, Chile and Brazil. In addition, the “China factor” is also implicitly one of the factors affecting the said opening and negotiations for Germany. The increasing influence of China in the economy of South American countries disturbs the United States (USA) and the European Union (EU) and naturally Germany in the regional market. South America ranks second among the destinations where China engages in foreign direct investments.[3] In addition, some South American countries have been included in China’s Belt-Road Project.[4] Therefore, the ties that China is trying to form with South America is another reason that encourages Scholz’s attempts to strengthen its political and economic relations in the region.

The initiative, which was brought to life under the influence of all these factors, led Scholz to visit Argentina, Chile and Brazil, respectively. Relevant countries play a key role in Germany’s goals in South America. Argentina is the 3rd country in which Germany directly invests abroad, mainly in the energy sector.[5] Both Germany and Argentina seek to carry their cooperation in the energy sector to other sectors.

On the other hand, it can be said that Scholz’s visit to Chile was shaped around the “Hydrogen Task Force Agreement” signed between the parties in 2021. Under the agreement, Chile is expected to supply Germany with 3-4 times more green hydrogen than it needs by 2050.[6] In line with this goal, German companies specializing in lithium mining operate in Chile. Therefore, it is aimed to develop the necessary technical infrastructure and to ensure efficient coordination between the parties.

Scholz’s visit to Brazil, on the other hand, is the most important visit of the Chancellor due to its scope. This visit is the first visit to be made by a Western leader in his new term to Luiz Inácio Lula da Silva, who took over the post of Prime Minister on January 1, 2023. Considering the coup attempt against Lula on January 8, 2023, it can be stated that Scholz’s visit is of great importance within the scope of support to the Brazilian Government. However, the visit in question is also important in terms of restoring the EU-MERCOSUR relations, which deteriorated during the Jair Bolsonaro administration in Brazil, and bringing the trade agreement, which was subsequently suspended, back on the agenda. The trade agreement between the EU-MERCOSUR has been suspended due to Bolsonaro’s opposition to the EU and the production of certain products to be shipped to the EU under this agreement by destroying the Amazon Forest. However, Lula looks forward to potential cooperation with the EU; Among his election promises, he also stated that he would put an end to the destruction in the Amazon Forest.[7] Germany, on the other hand, has announced that it will restart its contributions to the Amazon Rainforest Conservation Fund, which was frozen during Bolsonaro’s presidency, with the first payment of 35 million euros.[8] Thus, obstacles to EU-MERCOSUR cooperation have been removed. As a result, Scholz’s visit to Latin America seems to determine how relations will progress.

[1] “Canciller de Alemania, Olaf Scholz, inicia su primera visita oficial a Latinoamérica”, El Financiero,, (Date of Accession: 28.01.2023).

[2] “Scholz: “Con Argentina impulsaremos las ya estrechas relaciones en el sector de las energías renovables””, El Diario,, (Date of Accession: 28.01.2023).

[3] “América Latina: el segundo mejor destino de inversión para China””, Portafolio,, (Date of Accession: 18.02.2022).

[4] “Los principales proyectos de la Ruta de la Seda china en América Latina: puentes, puertos y rutas””, Tn Internaciónal,, (Date of Accession: 09.05.2022).

[5] “Olaf Scholz llega a Argentina para reunirse con Alberto Fernández””, Actualidad RT,, (Date of Accession: 28.01.2023).

[6] “Chile and Germany Sign Agreement for the Promotion of Green hydrogen””, Energy Partnership CL,, (Date of Accession: 29.06.2021).

[7] “Lula procurará revertir la deforestación del Amazonas””, Ap News,, (Date of Accession: 23.01.2023).

[8] “Olaf Scholz y Alberto Fernandez reafirmaron importancia de un acuerdo “rápido” UE-Mercosur””, France 24,án-en-su-primera-gira-por-sudamérica, (Date of Accession: 28.01.2023).