MercoPress. South Atlantic News Agency

China's growing presence in Latin America

Venezuelan President Hugo Chavez, in Beijing on his fourth visit to the oil-hungry Asian giant, has signed a number of energy deals covering production, refining and transportation.

Here are some facts on China's growing presence in Latin America:

Overview:

- Trade between China and Latin America has grown six fold over the past six years as Beijing has turned to the region for oil, copper, iron and other raw materials to fuel its growth. - In September 2004, China sent a "special police" peace-keeping contingent to Haiti, marking Beijing's first deployment of forces ever in the Western Hemisphere. - In may 2004, the 35-member Organization of American States' (OAS) accepted China as a formal observer. - During President Hu Jintao's high-profile 2004 visit, Argentina and Brazil granted China "market economy" status, a move that Beijing has been lobbying for since it joined the World Trade Organization (WTO) as a no market economy in 2001. Many other countries in the region followed suit. - China's involvement in Washington's traditional sphere of influence in Latin America forced the United States, wary of potential "crossed wires," to initiate a dialogue with Beijing on the issue.

Energy and Commodities:

China's quest for oil to meet surging energy demands and commodities for other areas of its economy are propelling its trade with Latin America. Here is a list of Chinese energy and commodity related interests in major Latin American countries:

Argentina - Chinese President Hu Jintao signed accords with President Néstor Kirchner in November 2004 to invest nearly US$20 billion over the next 10 years in the country. China is Argentina's top market for soybeans.

Bolivia - In September 2005, China's Shengli International Petroleum Development Co. Ltd. signed a framework pact with state-run Yacimientos Petrolíferos Fiscales Bolivianos to invest US$1.5 billion over 40 years in Bolivia's onshore oil and gas sector. China is also interested in developing the country's largest tin mine Huanuni.

Brazil - Brazil exported 1.34 million tons of oil to China in 2005. China's top refiner Sinopec has signed a US$239 million deal with state-owned Petrobras for construction of a stretch of a major natural gas pipeline across Brazil.

Cuba - China's oil and gas giant Sinopec Corp. signed an agreement with Cuba's state-run Cubapetróleo (Cupet) to jointly produce oil on the Caribbean island in January 2005. China's state-owned Minmetals is investing US$500 million in a joint venture to produce 68,000 tons a year of ferro-nickel in eastern Cuba. Cuba hopes to almost double its nickel production within three years with the help of Chinese investments.

Chile - China's Minmetals Corporation signed an agreement in February to invest an initial amount of US$550 million, which could eventually rise to US$2 billion, to set up a joint venture with Chilean state copper company Codelco.

Colombia - President Alvaro Uribe travelled to China in April 2005 to promote investment in Colombia. China's top oil refiner Sinopec has teamed up with India's ONGC Videsh to invest US$850 million in a 50 percent stake in oil firm Omimex de Colombia.

Ecuador - Chinese-led consortium Andes Petroleum, which includes China National Petroleum Corp. and Sinopec group, bought Canada-based Encana's oil and pipeline assets in Ecuador for US$1.42 billion in September 2005.

Peru - A CNPC unit produces oil in Peru, and in January 2005 a memorandum of understanding for joint exploration was signed. Peru's only iron ore mine, Shougang Hierro Perú SA, is owned by China's state-run steel maker Shougang group.

Venezuela - CNPC operates two Venezuelan oil fields and has committed to spend over $400 million in Venezuelan oil sector. It is currently working with state oil company PDVSA to certify reserves in the Junin 4 block of the Orinoco extra heavy oil belt, the world's largest deposit of crude oil. Chinese investments in Venezuela total more than US$1.5 billion.