One Year In: How South Connection Is Rewiring South America

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A shipment of lithium leaves the salt flats of northern Chile, bound for battery manufacturers in the United States. The minerals are there, the demand is there, and the trade agreement is in place. But between the salt flat and the factory floor lies a journey through roads not built for industrial freight, border crossings where paperwork still travels by hand, and regulatory systems designed by four countries that have never fully coordinated with one another. The journey costs more than it should. And a region sitting atop the world's largest lithium reserves struggles to capture the full value of what lies beneath its ground.

This is not an exceptional situation. It is the ordinary cost of doing business across South America, a continent with extraordinary assets and persistent connectivity gaps that prevent those assets from translating into shared prosperity.

South Connection is a 2025–2030 program built around three pillars: improving physical and digital infrastructure; streamlining logistics and trade facilitation; and strengthening the regulatory and institutional frameworks that govern cross-border activity.

Energy makes the case clearly. South America holds some of the world's richest renewable resources, yet in 2023 over 95% of cross-border electricity exchanges were bilateral, ad hoc, and concentrated in the Southern Cone. IDB analysis suggests that optimizing existing interconnections alone could save the region nearly $2 billion a year. South Connection is backing the transmission projects and regulatory frameworks that could turn that potential into a real regional energy market.

Source: IDB South Connection