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* Iberian, Latin American leaders hold summit in Cadiz
* All sides seek more investment
* Changing relationship amid differing economic fortunes
By Angus MacSwan
CADIZ, Spain, Nov 15 (Reuters) - In past centuries, the Atlantic port of Cadiz played a central role in trade between Spain and its Latin American colonies, with merchants and adventurers bringing treasure back to the mother country from the mines and plantations of the empire.
In recent decades, Spanish and Portuguese businessmen roamed the continent in a wave of investment known as the "Reconquest".
But leaders meeting here for the Ibero-American Summit on Friday and Saturday face a relationship that has changed profoundly in the past few years. The former colonies may hold the keys to their ex-masters' salvation.
Spain and Portugal's economies are just about shipwrecked amid the euro zone crisis. Both have needed outside support to keep afloat and their people have taken to the streets to protest against austerity measures and job losses.
Latin America is for the most part prospering, with average growth at more than 4 percent last year. It is no longer a weak partner.
Plotting a new economic course and exploring new opportunities in trade and investment in these troubled times will be one of the main purposes of the Cadiz gathering.
"Before, Spain and Portugal could set the agenda," said Ramon Pacheco Pardo, a Spanish, Portuguese and Latin American Studies associate at King's College, London.
"Now the relationship is much more about the economy, about necessity. Spain and Portugal really need those markets. It's also an opportunity to sit down with countries that understand what it's like to go through economic crisis."
The depths of despair for ordinary Spaniards and Portuguese were evident in recent days. Millions of people took to the streets in both countries and elsewhere in Europe on Wednesday angry over cuts in welfare, pensions and public service jobs.
A woman in Bilbao last week committed suicide as she was about to be thrown out of her house, shocking the nation and prompting banks to reassess their policies.
One in four Spanish workers is now jobless in a crisis driven by a property collapse in 2008. In Portugal, unemployment is nearing 16 percent. Repeating a historical pattern, about 20,000 Spaniards moved to Latin America last year.
The Spanish chamber of commerce in Brazil said it had received nearly 1,300 resumes in the past year from professionals interested in working there.
"They are looking for opportunities that don't exist in Spain at the moment," said Maria Luisa Castelo Marin, the chamber's executive director.
Spanish companies also rely heavily on profits from their Latin American operations to compensate for weakness at home.
Telecommunications company Telefonica said last week it moved from loss to profit as a Latin American contribution of 49 percent of revenues offset its troubles in Europe. Banking giant Santander also takes more than 50 percent of its profits from the continent, a hefty chunk of that in Brazil.
"This summit is taking place at a time of great problems for Spain and Portugal," Ibero-American Secretary General Enrique Iglesias told El Pais newspaper. "The central theme is that we are looking for a new relationship with Spain and Portugal."
He noted the frenzied activity by Iberian investors in Latin America in the past 20 years and said more opportunities were there to explore, including in energy, infrastructure and communications.
"It is a very fertile field for Spanish firms," the veteran Uruguayan diplomat said.
Iglesias cautioned, however, that Latin America was also feeling the effects of the world crisis because of reductions in exports to Europe and a slowing of growth in China.
Previous summits have often been dominated by strongmen such as Cuba's Fidel Castro and Venezuela's Hugo Chavez, which provided entertainment if little else. Neither will be present this time and arguably the most important figure will be Dilma Rousseff, the president of emerging powerhouse Brazil.
Spanish investment in Brazil stands at about 55 billion euros. But any Spanish hopes of reciprocal investment - Brazil's economy has overtaken Spain's in size - might be premature.
Rousseff is known to be worried about a possible Spanish and Portuguese collapse. S he will stay in Spain after the summit for meetings with Prime Minister Mariano Rajoy in Madrid.
Brazil's Embraer, the world's third largest aircraft-maker, did open a factory in Evora, Portugal, last June and steelmaker CSN acquired Spanish steelmaker Grupo Alfonso this year. But these moves may not herald a new trend.
Latin Americans are also keen on winning more investment - Peruvian President Ollanta Humala will also stay on after the summit and drop by Portugal to tout Peru's attractions.
Spanish companies have run into their fair share of risk in Latin America, with leftist leaders in Argentina and Venezuela seizing assets as they nationalise sectors of their economy.
Spanish oil major Repsol lost half of its production after Argentina nationalised its YPF unit in April.
In Venezuela, Telefonica had $3 billion in profits last year that it has been unable to repatriate because of strict exchange rules. There is also Spanish concern that Banco Provincial, which is owned by owned by BBVA, could be in Chavez's sights for nationalisation.
Argentine President Cristina Fernandez will not attend the summit, sending her vice president in her place. Madrid worked hard to get other leaders to show up following a poor turnout last year that led to questions over its value.
Still, at least one Latin American held out hope to the impoverished Iberians of calmer seas ahead.
"We have to enter into a bigger relationship with certain economies because of their commercial power" said senator Gabriela Cuevas, head of Mexico's foreign affairs committee.
"If right now Europe doesn't look so attractive, sooner or later it's going to recover. So now is the time to prepare."