Diplomacy

Arab & Latin Economies Strengthen Ties

4th ASPA Summit

Leaders representing 34 countries from Latin America and the Arab world met in Riyadh to discuss topics of common interest like inter-regional double taxation, easing capital flow, and technology transfer.

The fourth Summit of South American and Arab Countries (ASPA), the bi-regional forum for cooperation and political coordination, took place in Riyadh on November 10-11, 2015 and represented a significant step toward stronger integration between the two blocs.

The ASPA group is composed of the 22 member states of the League of Arab States (LAS) and the 12 of the Union of South American Nations (UNASUR) plus the secretaries general from both organizations. The summit’s main purpose was to foster economic and commercial dialogue between the blocs, in addition to seeking a consensus on worldwide political matters of the greatest importance.
Then Brazilian President Lula proposed the meeting in 2003 after visiting several Arab countries and the first ASPA Summit of Heads of State and Government was held in Brasilia in May 2005. Over time, and as a result of the second and third ASPA Summit held respectively in Doha, Qatar (2009), and Lima, Peru (2012), economic cooperation between the two regions has increased significantly. Trade exchange volume between Arab and Latin countries stood at $6 billion in 2004, jumped to $13.7 billion the following year and registered a nearly three-fold growth over the past decade, reaching $34.8 billion in 2014. In November 2014, the 34 member states met at the King Abdulaziz International Conference Centre in Riyadh in a bid to further boost social, political, and economic ties. The outcome of the ASPA Summit is the Riyadh Declaration, a document drafted during the preparatory ministerial meeting and the clauses of which have successively been unanimously approved by the heads of government after the two-day discussion.

According to the text, ASPA members “condemn terrorism in all its forms and manifestations and reject any attempt to associate terrorism with specific religions, cultures, or ethnic groups.” The document also advocates for a peaceful solution to the ongoing crisis in Yemen, Libya, and Syria. The declaration calls for an immediate withdraw of Israel from all those territories occupied during the 6-Day War in 1967 and for a definitive solution to the sovereignty dispute between the UK and Argentina over the so called “Question of the Malvinas Islands.”
Two other priority areas of action included in the Riyadh Declaration are the fight against climate change and control on nuclear power. As per the first, Saudi Arabia, whose economy relies heavily on oil, submitted a laudable climate action pledge to the UN. On the subject of nuclear power, the text affirms “the equal right of all peoples to live in a world free from any nuclear weapons and weapons of mass destruction (WMDs),” while supporting the use of nuclear power for peaceful purposes, defining it as “an inalienable right of states party to the Non-Proliferation Treaty.” Although the word “oil” is never mentioned in the 23-page text, Arab and South American leaders have discussed the subject of energy production and energy efficiency improvement, appealing for stronger cooperation in the energy sector to achieve mutual benefit. Of the 34 ASPA members, eight are also members of OPEC, and some of them are interested in increasing the dwindling oil prices. Finally, leaders agreed on the necessity of implementing measures to facilitate transfer of technology and capitals, “especially in the fields of food and agro-industries, energy, innovation, infrastructure, tourism, manufacturing sector and information technology.” During the opening ceremony of the conclave, King Salman expressed the need to discuss over “signing an agreement on a free trade, avoidance of double taxation and on inducement and protection of investments of states of both regions,” adding that boosting commerce and trade would help countries to reduce their financial straits. Saudi Arabia has a lot to gain from strengthening ties with a developing resource-rich region like South America.

On the sidelines of the event, Saudi Arabia and Brazil signed an international sanitary agreement to end the embargo on Brazilian beef exports to the Kingdom. Saudi Arabia also signed a double taxation agreement with Venezuela to foster mutual investment between the countries and avoid tax evasion. Pending topics such as the creation of an ASPA permanent Secretariat, UN 2030 challenge agenda, and the establishment of a southern investments bank will be discussed in the next summit set to be held in Caracas, Venezuela, in 2018.