The Atlantic Triangle and the Europe-Latin America relationship: when risk comes to dictate strategy

The world today is undoubtedly difficult to navigate: we are living through a period of significant international transformations, with wars in the Middle East and Europe, tensions and hotspots of conflict in other regions, and trade and tariff disputes among the major powers.

In this context, the United States, Europe, and Latin America are redefining their relationships, and their place in the global economy in the coming decades depends largely on this redefinition.

Geopolitical risk has returned to the forefront not only because of the conflicts themselves, but also because of two factors that exacerbate them: the economic interdependence resulting from globalization and the proximity of several conflicts to major bottlenecks in international trade. The figures help to illustrate this. In 2025, trade was equivalent to 68% of global GDP, according to the World Bank; to a large extent, it takes place within the framework of global value chains. Furthermore, nearly 80% of the exchange of goods travels by sea and passes through critical points such as the Straits of Hormuz, Malacca, and Taiwan, or the Suez and Panama Canals.

For decades, production and trade decisions followed a dominant logic: efficiency measured in terms of cost and time. This logic drove offshoring to emerging economies and the just-in-time model, with minimal inventories. Since 2020, three shocks of different natures have challenged it: the COVID-19 pandemic, the war in Ukraine, and the conflicts in the Middle East.

The result is a slow but steady reconfiguration of value chains, with three key movements: nearshoring (producing near major consumption centers), friendshoring (producing in politically aligned countries), and diversification , which involves not only adding suppliers but also locating them in less risky regions.

In all three cases, companies seek greater control over their supply chains and wider market diversification; in this process, they also explore new business models.

According to UNCTAD’s World Investment Report 2026, foreign direct investment (FDI) grew by 6% in 2025 and is becoming increasingly selective: the top 20 recipient economies account for more than 80% of the flows. Europe accounts for part of this increase: FDI received rose by 39%, from USD 204 billion in 2024 to USD 285 billion in 2025, concentrated in the industrial and technological sectors. The pursuit of resilience, security, and strategic autonomy, within a context of geopolitical and geoeconomic tensions with the United States but also with China, explains this trend.

Latin America and the Caribbean, for its part, received approximately US$188 billion in FDI in 2025, 14% more than in 2024, driven by investment growth in South America and, especially, in Brazil. The region possesses a number of strategic natural resources, both now and in the future, including critical minerals, rare earth elements, and energy and water resources. But as the ECLAC Commission on Geopolitics, Globalization and Development argues in its August 2026 report, it also has other “strategic assets,” such as its productive, human, and financial capacities, and its status as a zone of peace.

The third point of the triangle, the United States, is recalibrating its global role and reviewing its alliances, including its transatlantic relationship with Europe, which is currently being questioned on both sides of the Atlantic. At the same time, the National Security Strategy of late 2025 and the “Trump Corollary” to the Monroe Doctrine express a renewed and more assertive interest in the Western Hemisphere, with the aim of limiting Chinese influence in various fields. For example, in September 2026, Washington announced the Andes-Atlantic Corridor and a $7 billion investment in infrastructure, both in Argentina.

So, what place does the relationship between Europe and Latin America occupy? This other transatlantic link can be revitalized, driven by the need for security and resilience and by frameworks such as the agreement between the European Union and Mercosur. For both sides, it is a way to diversify trading partners, especially in areas where there is significant complementarity : these include energy, critical minerals, industrial value chains, the knowledge economy, and digital transformation. But the goal is more ambitious: for the bi-regional relationship to extend beyond trade and become also productive, technological, and geopolitical. In this sense, the upcoming Ibero-American Summit to be held in Madrid in November takes on particular importance.

Business leaders know their sectors, markets, and business models inside and out. They are accustomed to making strategic and bold decisions when the opportunity arises. Today, however, they face a new landscape. Efficiency alone is not enough: risks must be anticipated. Foresight alone is not enough: adaptation is essential. Having the right talent, developing strategic foresight capabilities, and strengthening global ecosystems that provide partners, insights, and real-time solutions will be key to turning risks into opportunities in this turbulent world.