Latin America is quickly emerging as a key growth market for Finnish businesses. With dynamic economies and evolving industries, the region offers significant opportunities in sustainability, innovation, and infrastructure development–areas where Finnish expertise is globally recognized. Sectors such as bioeconomy, renewable energy, mining, infrastructure, and waste management align well with Latin America’s focus areas. Notably, strategic trade agreements like the EU-Mercosur Free Trade Agreement (FTA) provide Finnish companies with a unique opportunity to expand their footprint in this vibrant market.

Key Trade Agreements and Their Impact

Key trade agreements are opening significant opportunities for Finnish companies to expand into the region:

• EU-Mercosur Free Trade Agreement:
  If ratified, the EU-Mercosur FTA will be the world’s largest free trade pact, representing a game-changing opportunity for Finnish companies. The agreement will eliminate tariffs on 91% of goods over 15 years, significantly boosting trade between the European Union and the four Mercosur countries: Brazil, Argentina, Uruguay, and Paraguay. This opens vast opportunities across industries, particularly in consumer goods. The agreement is expected to take effect in 2026, potentially reshaping the region’s business landscape and creating new avenues for Finnish companies.
• EU-Mexico and EU-Chile Trade Agreements:
  Beyond Mercosur, the EU-Mexico and EU-Chile FTAs provide Finnish companies with a strong foundation for deepening their engagement with the region:
• EU-Mexico Agreement: offers Finnish companies access to public procurement markets, allowing participation in public tenders. The EU-Mexico FTA is still waiting for ratification.
• EU-Chile Agreement: simplifies trade processes and supports Finnish businesses in sectors like energy, mining, and infrastructure. The renewed agreement improves investment conditions and regulatory transparency.
  

Finnish Presence in Latin America

With over 1,000 Finnish companies operating in Latin America–including more than 220 subsidiaries contributing over EUR 7 billion in turnover–Finnish businesses have already established a solid foundation in the region.

One long-standing example is Vaisala, a global leader in weather, environmental, and industrial measurements, which has been active in Latin America since 1939. Aleksis Kajava, Sales Director, Europe and Latin America, Weather at Vaisala, shares that “success in Latin America depends on building trust-based relationships, maintaining a local presence, and having a partner network, while committing to long-term goals.” Likewise, companies that embrace these principles have thrived in the region’s competitive environment.

Emerging Business Sectors

Latin America is experiencing strong economic growth and stability, making it one of the most attractive markets for new investors. Key opportunities for Finnish companies arise in several sectors:

• Energy:
  Latin America hasone of the cleanest electricity sectors in the world, offering bright prospects for future clean energy industries. The region is increasingly focusing on renewable energy, biofuels, and hydrogen, which align with Finland’s expertise in clean energy technologies. Finnish companies can contribute to the development of biofuels, sustainable aviation fuels, hydrogen adoption, and bioenergy solutions. Additionally, ethanol’s role in energy production and maritime transportation continues to expand.

• Bioeconomy and Forest Industry:
  Latin America holds huge potential for sustainable forest management and circular economy solutions. For Finnish forestry and bioeconomy technology companies, Brazil, Chile, Uruguay, Paraguay, and Colombia offer immense opportunities for win-win partnerships. Brazil is leading efforts to transform the forest industry’s by-products into value-added products like fertilizers and sustainable materials such as lignin and textile fibers. Finnish companies specializing in circular economy technologies are well-positioned to unlock these opportunities. New pulp mill investments worth over 20 billion EUR are planned for the coming years.

Valmet, a leading global developer and supplier of process technologies, automation, and services for the pulp, paper, and energy industries, is delivering a pulp mill to Arauco in Brazil, marking the largest project of its kind. The mill will generate a significant amount of excess bioelectricity, contributing positively to the sustainable energy supply of the area. In addition, “Valmet is cooperating with several South American pulp producers to study the possibilities for lignin production”, says Carita Ollikainen, Head of Corporate Relations at Valmet.

• Mining & Natural Resources:
  Latin America is home to some of the world’s largest mining regions, with around half of global reserves of lithium, and more than a third of copper and silver reserves. Finnish companies can support sustainable mining practices, mineral recovery from tailings, circularity in mining, electrification of mining equipment, and the adoption of renewable energy in mining operations. Brazil, Peru, and Mexico are also exploring green hydrogen use in mining.
• Infrastructure:
  Latin America is undergoing a significant infrastructure overhaul, with projects ranging from roads and railways to airports and ports. This creates promising prospects for Finnish companies specializing in technology, engineering, and project management.
• Waste Management & Recycling:
  Countries like Argentina, Uruguay, and Mexico are focused on Extended Producer Responsibility (EPR), which presents opportunities for Finnish expertise in collection, sorting, and recycling technologies. Likewise, Chile and Brazil offer growing potential in plastics and textile recycling.

Building Strong Local Partnerships

Success in Latin America hinges on cultivating reliable local partnerships. To establish long-term, sustainable relationships, it is essential to identify suitable partners, build trust, and focus on mutually beneficial collaboration. 

Lamor, a company providing environmental solutions to clean the world, has subsidiaries in Ecuador, Chile, Colombia and Peru and partnerships in several other countries in the region. Johan Grön, CEO of Lamor, highlights, “Trust is one of the key factors in business and the basis for partnerships. Local win-win partnerships are crucial for building a long-term sustainable business.” Successful business relationships are built on mutual respect and trust.

Business Finland recently interviewed 12 Finnish companies that highlighted the importance of building partnerships and shared best practices in navigating the Latin American region. A comprehensive guide on these insights can be found here: Best Practices Guide.

Latin America presents vast opportunities for Finnish companies, driven by strategic trade agreements, economic growth, and a strong push toward sustainability and innovation. With Finland’s expertise in sectors like bioeconomy, clean energy, mining, and waste management, Finnish companies are well-positioned to thrive in this dynamic market. Success, however, depends on building trust-based local partnerships and committing to long-term collaboration.

Now is the time for Finnish companies to explore Latin America’s potential. Whether you are looking to expand your operations, establish new partnerships, or explore investment opportunities, the Finnish-Latin American Business Council and Team Finland can support you in navigating the region. Get in touch with us to learn more and take the first step toward tapping into one of the world’s most promising markets.

The Finnish-Latin American Business Council and Business Finland organized a seminar on the Latin American Morning Session: Mercosur Free Trade Agreement and Import Duties of Mexico in the Framework of the USMCA Agreement in Helsinki on the 13th of February 2025.

The article is written by Ms. Heidi Virta, Director, Head of Region Latin America, Business Finland, and member of the Board of Directors of the Finnish-Latin American Business Council.