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America. Also the issue of human rights in their indivisibility, which do not only contain
the civic-political rights of the “Civil Defense Act”, 159 but also economic, social
and cultural human rights, 160 do not seem to constitute a basic role model for the
actions of European transnational corporations.
Europe’s economic interest in the Latin American countries is not uniform: In
the course of the privatizations and liberalizations of the last few years Spanish corporations
above all have tried to take over entire economic sectors by buying state
owned companies all over Latin America. German corporations, for example, which
traditionally have a relatively strong presence in Latin American domestic markets,
have not participated in this wave of takeovers. Dutch corporations, on the other
hand, who had participated in the takeovers in the nineties to a minor - but nonetheless
significant – extent, are once again partially pulling out: The Dutch retail corporation
Ahold, confronted with payment difficulties, is just one example of this. 161 Other
European corporations have also backed out of Latin America: For example, the
French Crédit Agricoles and the ScotiaBank, which as a result of the Argentine crises
pulled out of Argentina. This retreat can nonetheless be seen in the global decrease
of foreign investment flows. 162
International capital flows in terms of FDI can be explained to a large extent by
cash flows in the area of M&A. 163 Throughout Latin America the market for M&A in the
first half of 2003 has shown clear signs that Latin American companies have been
increasingly positioning themselves (Latin American M&As accounted for 62.5 % of
the total at the end of June 2003, according to estimates from Thomson Financial).
This is, however, most likely due to the drawback of European and North American
companies. At the same time it has to be mentioned that reinvestment using acquired
cash-flows made by foreign companies who already reside in Latin America is
statistically not treated as foreign capital, just as the country specific classification of
FDI-flows, which pass through so-called tax havens, is not possible:
“It is striking that, according to the estimates of central banks and ministries
from Latin America, one fifth of FDI comes from other countries, i.e., primarily
from tax havens. But tax havens seem to merely be of transitional nature
for investment by companies from the industrial countries, yet statistics of
the industrial countries give similar numbers for the direct investment of their
159 Adopted by the General Assembly of the UN in the Universal Declaration of Human Rights in 1948.
160 Put down in the International Treaty on Economic, Social and Cultural Rights on December 19, 1966 and ratified
in the “Social Pact” in 1976.
161 FT, December 22, 2003.
162 United Nations Conference on Trade and Development (UNCTAD): World Investment Report 2003 - FDI Policies for
Development: National and International Prespectives, New York/Geneva 2003.
163 Ibid.