Open veins: Drain from Latin America through ecologically unequal exchange

In Open Veins of Latin America (1971), Eduardo Galeano argued that colonial interventions in Latin America organised the regional economy around raw material exports and drained the continent of valuable resources and labour, producing conditions of underdevelopment. Scholars have argued that this dynamic continues today, where the suppression of prices and input costs in peripheral regions enables the global North to appropriate resources and value through ‘unequal exchange’. Building on this analysis and grounded in the Marxist tradition of dependency theory, this study empirically assesses Latin America's position with respect to unequal exchange of natural resources and labour embodied in trade. We use environmentally extended multi-regional input-output (EEMRIO) analysis to measure net flows of embodied materials (biomass, fossil fuels, minerals, and metals), land, and labour between Latin America, the global North, China, and the rest of the global South (1995 to 2020) across seven sectors, along with wage compensation against the labour flows. We find that Latin America has suffered a large drain of all resources to the North over the period. In 2020, the North net-appropriated 935 million tons of materials (including biomass, minerals, metals, and fossil fuels), 4 million km2 of land, and 53 billion hours of labour (worth €816 billion in Northern wages) from Latin America, mostly consumed as manufactured goods and services. We find that Latin America's position in the world economy is increasingly ‘peripheral’ in character. It remains a major supplier of primary commodities to the North, experiences a greater per capita drain of biomass, metals, and land than China or the rest of the global South, and disproportionately suffers the ecological damages of Northern consumption.