China as moved swiftly to develop economic ties in Latin America, beating the United States as a trading partner in Brazil, Chile and Peru, and now the world’s economic authorities are calling for even stronger ties with the communist nation.
“Latin America and China must work together in the deepening of a dynamic, long-term and strategic relationship based on a common agenda. Such a relationship should promote symmetry in trading relations, technology transfers and strategic investments,” said Enrique García, president of CAF, the development bank of Latin America.
The cover of the new Latin American Economic Outlook.
The Latin America Economic Outlook from Organization for Economic Co-operation and Development, the Economic Commission for Latin America and the Caribbean, and CAF was released Monday and calls for stronger Latin-China ties.
It comes as the economies of both have been struggling, and after years of quiet complaining from some Latin leaders that the United States isn’t paying enough attention to it.
That is evidenced in the surge of Chinese trade with the region, especially Brazil.
According to the report, China trade has increased enormously. From a release on the report:
Since 2000, the trade relationship between Latin America and China has experienced an exceptional expansion, multiplying 22-fold, compared to a 3-fold increase with the world at large, says the report.
The evolution of China’s participation in Latin American global value chains has been remarkable and has even surpassed intraregional ones: between 2000 and 2011, the region’s intraregional share of backward linkages grew from 5 percent to 9 percent, and China’s share roared from 1 percent to 11 percent. Today, China is the largest trading partner for Brazil, Chile and Peru.
The report warns of shrinking demand for Latin products in China, despite a growing and more educated population. To change that situation, the report suggests a focus on new products and stronger economic ties.
“To seize the momentum of the new opportunities propelled by China’s new normal and to remain competitive, Latin American and Caribbean economies need, first, to pursue innovative development policies to better cater to growing Chinese domestic demand, notably in the agro-food industry and services. Designing policies and a truly effective strategy in skills and innovation will also be essential to keep up with how China is strengthening its human capital,” said the report.
It added: “Existing financial ties between the region and China need to be deepened and optimised.”
Paul Bedard, the Washington Examiner’s “Washington Secrets” columnist, can be contacted at [email protected]
