President of the Inter-American Development Bank sees opportunities in Latam for exporting food, critical minerals, and green energy

Latin America could change its fortunes and leave behind years of mild growth with the right strategy, according to Ilan Goldfajn, president of the Inter-American Development Bank, who believes that the region is at a "turning point."

"This is not just a narrative, there is actually an opportunity to seize...we will participate in everything we can do in terms of renewables and clean energy and clean minerals and things like that," the economist told The Financial Times in London.

The former head of Brazil’s Central Bank referred to the investments with the greatest potential, such as lithium or grain exports.

According to the report "The Lithium Market Outlook To 2030" by Benchmark Mineral Intelligence, Latin America holds 56% of the world’s lithium reserves. This is due to the existence of the so-called "lithium triangle", comprising Argentina, Bolivia, and Chile. Specifically, Argentina has 24% of the world’s lithium reserves, Bolivia 22%, and Chile 10%.

But lithium is not the only essential mineral locally. Latin America is the world’s leading producer of copper and silver, and the world’s second-largest producer of nickel, in addition to rare earths.

Also noteworthy is the region’s potential for clean energy. Last year, Latin America generated 8.2% of the world’s renewable energy and remained a world leader in hydroelectric power.

Amid Russia’s war in Ukraine and in the face of the supply difficulties that the conflict brought, food is another key point for growth. In 2022, the region exported a total of 147.2 million tons of grains, mainly corn, soybeans, wheat, and sorghum, representing 11.5% of the world total. The main destinations for these exports are China, the United States, the European Union, and the Middle East.

However, resources alone are not enough. According to Goldfajn, governments must invest in productivity, education, and stability to encourage lending and investment.

Author: Marina Vanni