MercoPress. South Atlantic News Agency

China has come to the rescue of Latinamerican exports, says Cepal

Latinamerican exports to China dropped 4.1% compared to 36.3% and 35.3% to the EU and the US

China’s sustained demand for food, energy and minerals has helped Latinamerican countries to stimulate their economies and contain the negative impact of the current global recession, according to the latest report from the United Nations Economic Commission for Latinamerica and the Caribbean, Cepal.

“The Chinese economy is one of the few that has kept expanding in the middle of the world crisis. This year growth is estimated at 8% based on the intensity and efficiency of a stimulus package of 580 billion US dollars, second only to the United States”, reads the report which praised the way Beijing authorities have addressed the challenge.

Further more, “the monetary and credit support program is even more significant than the fiscal stimulus, and the confluence of both plans underlines and helps to understand the economic success of China”.

The report which deals with “Latinamerican international insertion: crisis and regional cooperation spaces” points out that even when exports to China from Latinamerican and the Caribbean have eased as a consequence of global circumstances the contraction has been minimum 4.1% compared to the European Union and the United States where they have plummeted 36.3% and 35.3%, respectively.

“To a point, China’s domestic market has come to the rescue of Latinamerican exports”, argues Cepal.

China is currently the main destination of Brazilian and Chilean exports, second for Argentina, Costa Rica, Cuba and Peru.

The region has now a formidable window “to explore integration opportunities” with China and other Asia-Pacific countries, suggests the report.

But to explore these opportunities Latinamerican and Caribbean countries must examine the production integration taking place in Asia with China at the heart, and see how they can fit or incorporate to the value chains in formation.

The report proposes stimulating Asian and Pacific basin investments in Latinamerica and the Caribbean, and from the region in Asia, as well as promoting alliances between local and Asian economic agents with the purpose of promoting trade and investment.

Cepal points out that even when China has become one of the main investors in the region it has concentrated in oil, transport and telecommunications.

Therefore the region should be active in promoting Chinese investments in other fields as well as investing in China thus building a solid commercial bridge.

“This is the right moment to define a strategic link with China”, concludes Cepal.