Brazil and Chile agree to deepen mining ties

Among the various trade and investment agreements signed during the visit of Brazilian President Luiz Inácio Lula da Silva to Chile, those related to critical minerals stand out.

Lula was in Chile on August 5-6 to discuss economic topics and regional tensions with his counterpart, Gabriel Boric.

In a letter of intent, the mining ministries of both countries agreed to create joint policies and actions and promote transparency in the mineral sector, cooperate on research and development, and establish workforce training programs.

The letter also highlights the importance of sustainability, attracting FDI, exchange of know-how and digitization.

“We are certain that this strategic partnership between Chile and Brazil will strengthen our position in the global market, will boost the sustainable development of our countries and will contribute, globally, to a fair and inclusive energy transition. We have been working towards a true alliance to strengthen the green industry in Latin America,” Brazil’s mines and energy minister Alexandre Silveira said in a statement.

“We want a true alliance to strengthen the mineral transformation chain in South America. And, to consolidate our position in this strategic market, Brazil will launch a comprehensive program to boost our mineral industry. We will transform it into a driving force for the energy transition,” he added.

"Brazil and Chile can work together to try to promote a major verticalization of their mining segments, attracting more companies and suppliers to serve the sector in the region. But major integration of segments between the two countries is difficult because they have very different characteristics," Valdir Farias, CEO of mining consultancy Fioito, told BNamericas.

"Mining in Chile has a direct influence from the government through the operations of state company Codelco, which isn't the case in Brazil, where mining companies are owned by the private sector. This big difference between the countries makes it difficult to advance with joint initiatives in the mining sector, due to the different visions of business between state and private sector companies," he added.

Representatives from Saudi Arabia also recently visited Brazil and Chile to learn more about both countries’ mining potential, especially in relation to energy transition minerals such as lithium, copper and nickel.

Lula also tried to strengthen ties with Chile as relations with Argentina and Venezuela have taken a turn for the worse and weakened Brazil’s position of regional leadership.

The visit resulted in 17 agreements signed and sparked talks on logistics and telecoms integration, among other things.

In a speech, Lula said, "my government is committed to connecting all of South America through five major road routes, two of which include Chile." 

A comprehensive list of the agreements can be seen here.