Press Release
The event entitled “Policies for green productive development and productive integration in Latin America: Opportunities and challenges for the electric bus chain” provided a chance for public policymakers, leaders, experts and members of the productive sector to gather on June 19, 2024 in Brasilia, Brazil. The event marked the start of opportunities for collaboration to increase regional integration on green productive development in Latin America, with a focus on the opportunities existing for the chain of electric buses. The event – co-organized by the Economic Commission for Latin America and the Caribbean (ECLAC), the Ministry of Development, Industry, Trade and Services (MDIC) and the National Council for Industrial Development (CNDI) – was part of the activities of the Technical Cooperation Program entitled “Inclusive, Sustainable and Smart Cities” between ECLAC and the Federal Ministry for Economic Cooperation and Development (BMZ) of Germany, through German Technical Cooperation (GIZ).
The discussions on this occasion were based on the notable increase in strategies and explicit policies for green productive development, both in central and peripheral economies. In general, these policies have been structured with a vision focused on missions or strategic areas, especially those linked to decarbonization and a just ecological transformation. In the area of green productive development, industrial policy instruments with a classic approach (fiscal incentives, public procurement, financing mechanisms, etc.) are combined with contemporary approaches, including modern climate policy instruments (e.g. mechanisms for carbon pricing, environmental regulation, emissions targets, etc.).
One of the missions or strategic areas often present in this new generation of productive development policies in Latin America is electromobility. ECLAC has highlighted investments in electric buses as an opportunity for a Big Push for Sustainability that would promote sustainability, energy efficiency, economic growth and regional productive integration. In the electromobility sector, countries such as Brazil, Mexico, Argentina, Chile and Bolivia play a crucial role due to their industrial capacities and their reserves of strategic minerals, most notably the Lithium Triangle, which contains 60% of global reserves of this mineral essential for electric vehicle batteries.
In this regard, the event aimed to contribute to Latin American countries’ understanding of the challenges and opportunities for regional productive integration in the electric bus sector, which is a potential sector for green productive development. On the opening panel, the Executive Secretary of the Ministry of Development, Industry, Trade and Services of Brazil (MDIC), Márcio Fernando Elias Rosa, and the Executive Secretary of the National Council for Industrial Development (CNDI), Verena Hitner, stressed the importance of the New Industry Brazil (NIB): 2024-2026 Action Plan for the Neo-industrialization of Brazil, the third mission of which is focused precisely on sustainable mobility for promoting productive integration and well-being in cities. Verena Hitner emphasized that the NIB “is a policy that looks at the right to mobility and to access to public transportation, and builds productive densification processes based on that right.” Meanwhile, the Director of the Department of Regional Integration at Brazil’s Ministry of Foreign Affairs, Daniela Benjamin, shared the importance of regional cooperation and integration as a strategy to strengthen Latin American economies. The opening remarks and presentation (available in an annex) made by the Director of ECLAC’s Office in Brazil, Camila Gramkow, on the outlook for the electric bus production chain in Latin America clearly illustrated a scenario of accelerated demand for electric buses associated with the potential regional production capacities in this sector, pointing to strengths and bottlenecks for creating a big push towards green productive development in the region.
The event’s first panel – moderated by Ángela Peñagos, Director of ECLAC’s Office in Colombia – was focused on the goals, targets and instruments of the electric bus chain as a strategy for green productive development in Latin America. The panel featured the participation of leaders and public policymakers from Argentina, Brazil, Colombia and Chile, who shared their experiences and views on this issue. Matías Fernández, Coordinator of the Energy Department at the Argentine Association of Metallurgical Industries (ADIMRA), gave a presentation on the strengths and barriers to electromobility in the country. He commented on the need to import complete electric vehicle units in light of the lack of development of local value chains, but he also indicated that the automotive sector already established in Argentina could develop the expertise to reconvert its production of buses with combustion engines to electric buses. Representing Brazil, the Secretary of Industrial Development, Innovation, Trade and Services at the MDIC, Uallace Moreira, mentioned the importance of New Industry Brazil (NIB) for reverting the loss of technological complexity and productive density that the country has experienced in recent years. The competitive competencies forged in Brazil’s automotive sector indicate that the electromobility sector represents a window of opportunity for neo-industrialization and for the evolution of production structures with a focus on society’s well-being and that of the region. Meanwhile, Fernando Hentzchel, Head of Technological Capabilities at the Chilean economic development agency, CORFO, presented (in an available attached file) the foundations of a new Chilean model for sustainable productive development. Hentzchel defined the model as a balance between economic, social and environmental pathways that would ensure carbon neutrality and the conservation of ecosystems and biodiversity, creating quality jobs, greater productivity and greater justice and equality. To that end, it is necessary to diversify the country’s production matrix and make it more sophisticated, through the use and creation of knowledge, with electromobility serving as an excellent catalyst for this. The CORFO official also spoke about the lithium industry and its value chain in Chile and pointed to opportunities for regional integration, especially regarding trade between Chile and Brazil. Concluding the event’s first panel, Eduardo Enríquez, Colombia’s Deputy Minister of Transportation, presented (in an available attached file) an assessment of the transportation sector and its greenhouse gas emissions and the public policy instruments in place in his country. The Deputy Minister highlighted the National Urban Transport Policy and the National Reindustrialization Policy for facilitating the transition from an extractive economy to a productive and sustainable knowledge-based economy that would strengthen sustainable-mobility production chains in Colombia.
Commenting on the presentations and information shared were Piergiuseppe Fortunato, Lead Economist for the “Regional Integration and Industrial Policy for Transformational Change and Resilience in Latin America” program at United Nations Trade and Development (UNCTAD), and Alexandre Polesi, Executive Secretary of the Brazilian Electric Vehicle Association (ABVE). Fortunato emphasized the clear alignment between the different policies and initiatives presented in the region and stressed the importance of multilateralism for overcoming current challenges. The economist referred to Celso Furtado, ECLAC’s founding thinker, who defended the strengthening of regional value chains as a strategy for integration, with a view to expanding, diversifying and adding value to countries’ exports, and who also recognized the need for civic participation in building national development projects. ABVE’s Executive Secretary, Alexandre Polesi, reinforced the need to incorporate the vision of the private sector, companies and industry representatives into the planning and implementation of the policies discussed at the event, stressing that “it is very important that integration also occur between companies and commercial entities.” He agreed that sustainability and the energy transition must be issues that unite the region’s countries, including in the area of trade agreements, and he cited the importance of standardization agreements mainly on electromobility infrastructure to facilitate flows between countries.
The latter part of the day was focused on the specificities of productive integration in the electric bus chain in Latin America. An Economic Affairs Officer from ECLAC’s Production, Productivity and Management Division, Nicolo Gligo, served as moderator on the afternoon’s first roundtable, which featured the participation of more than 30 representatives of the public and private sectors from Argentina, Brazil, Colombia and Chile. They commented on the exogenous and endogenous barriers of the electric bus value chain, making a broad assessment of the sector, regulatory shortfalls or gaps, the need to develop infrastructure to meet the needs of electric mobility, the importance of furthering technological paths internally, and investment challenges in the specific context of each country and in the regional context.
In the following session, the Executive Secretary of Brazil’s National Council for Industrial Development, Verena Hitner, led a second roundtable, inviting those present to discuss a possible regional agenda for developing the electric bus chain in Latin America and affirming that Brazil intends to draw up objectives for Latin American productive integration. She asked the group to reflect on possible ambitions, parameters and goals for integration. The contributed suggestions were centered on: building regional technical standards to facilitate interoperability between countries; generating regional aggregate demand; developing regulations for public procurement that would prioritize regional content; developing a South American energy market; drafting a regional circular economy plan that would contemplate, for example, the reconversion of buses with combustion engines to electric ones; a regional discussion on the use of the strategic set of rare earths; sharing a road map for scientific and technological development; and organizing business gatherings to build a productive sectoral agenda for regional integration.
As the event concluded, Franco César Bernardes, Head of the Division of Technical Automotive Requirements at the MDIC’s Department for Development of Industry of High-Medium Technological Complexity, and Camila Gramkow, Director of ECLAC’s Office in Brazil, recognized and expressed gratitude for the contributions made throughout the event and stressed their importance. Both the MDIC and ECLAC, in their final remarks, expressed interest in continuing to support spaces for discussion to make progress on a regional agenda for developing the electric bus chain in Latin America.