China to finance major projects in Latin America
China to finance major projects in Latin America
At a summit, opened Saturday in Santa Cruz, the G77 + China group of developing nations met on its 50th anniversary to promote economic development.
Delegations from 133 countries and some three dozen heads of state were in attendance.
"China now acts in a different way with South American countries," said Gabriel Dabdoub, president of the chamber of commerce of the Santa Cruz region, Bolivia's economic engine.
The Asian powerhouse "no longer aims at only at buying raw materials, it wants to get into investing in industrialization," Dabdoub told AFP.
Bolivia, Latin America's poorest country, has experienced more than six percent growth in recent years and has plans for major infrastructure work.
"China is particularly attracted by industrialization projects that the country needs over the next 10 years and which cost an estimated $42 billion," Dabdoub said.
Chinese companies have expressed interest most notably in building a railway from Bolivia to Brazil, connecting the Atlantic and Pacific oceans, as well as in road and river connection projects.
In Brasilia, Chinese Foreign Minister Wang Yi recently announced his country's interest in increasing its investments and relationship with Latin America and the Caribbean.
And although Chinese President Xi Jinping will be notably absent from the Santa Cruz summit, he plans to participate in mid-July in Brazil in a BRICS meeting of emerging economic powers Brazil, Russia, India, China and South Africa.
Mass purchase of raw materials and sale of manufactured goods have made China the second trading partner of a number of countries in the region in recent years. And in 2009, China became Brazil's number one trading partner, ahead of the United States.
"Until recently Bolivia did not consider China a partner, it was very wary," Dabdoub said. "But now there is more trade, and, in fact, we've just acquired a satellite."
Bolivian President Evo Morales last December traveled to China with several ministers to attend the launch of Tupac Katari, his country's first telecommunications satellite.
China provided $102.2 billion in loans to Latin American countries between 2005 and 2013, particularly to Venezuela and Argentina, according to a report released in April by the Global Economic Governance Initiative at Boston University.
Last year, alone, China loaned Latin American governments, public enterprises and private companies $20.1 billion.
"Today, in terms of trade and investment, China is displacing the region's traditional partners like Europe and the United States," Gary Rodriguez, president of the Bolivian Institute of Foreign Trade, based in Santa Cruz, told AFP.
Bolivian analyst and former foreign minister Armando Loayza told AFP that China "certainly plays a greater role in the new millennium and will strengthen its commercial expansion by coming together with Latin America."
In neighboring Peru, one of the region's most dynamic economies, China's metal mining industry made its largest overseas acquisition earlier this year with the purchase of the Las Bambas copper mine, for around $5.85 billion.
In 2013, China also signed a contract with Venezuela — which sits atop the world's largest oil reserves — for a $28-billion project in the resource-rich Orinoco Oil Belt in the country's east.
Pompeo says China is engaging in ‘predatory economics 101’
- He said China’s recent claims of “openness and globalization” are “a joke.”
DETROIT: China is engaging in “predatory economics 101” and an “unprecedented level of larceny” of intellectual property, Secretary of State Mike Pompeo told a business audience Monday.
Pompeo made the remarks at the Detroit Economic Club as global markets reacted to trade tensions between the US and China. Both nations started putting trade tariffs in motion that are set to take effect July 6.
He said China’s recent claims of “openness and globalization” are “a joke.” He added that China is a “predatory economic government” that is “long overdue in being tackled,” matters that include IP theft and Chinese steel and aluminum flooding the US market.
“Everyone knows ... China is the main perpetrator,” he said. “It’s an unprecedented level of larceny.”
“Just ask yourself: Would China have allowed America to do to it what China has done to America?” he said later. “This is predatory economics 101.”
The Chinese Embassy in Washington did not immediately respond to a request for comment.
Pompeo raised the trade issue directly with China last week, when he met in Beijing with President Xi Jinping and others.
“I reminded him that’s not fair competition,” Pompeo said.
President Donald Trump has announced a 25 percent tariff on up to $50 billion in Chinese imports. China is retaliating by raising import duties on $34 billion worth of American goods, including soybeans, electric cars and whiskey. Trump also has slapped tariffs on steel and aluminum imports from Canada, Mexico and European allies.
Wall Street has viewed the escalating trade tensions with wariness, fearful they could strangle the economic growth achieved during Trump’s watch. Gary Cohn, Trump’s former top economic adviser, said last week that a “tariff battle” could result in price inflation and consumer debt — “historic ingredients for an economic slowdown.”
Pompeo on Monday described US actions as “economic diplomacy,” which, when done right, strengthens national security and international alliances, he added.
“We use American power, economic might and influence as a tool of economic policy,” he said. “We do our best to call out unfair economic behaviors as well.”