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Business / Economy

China's ties with LatAm key to region's economic growth

(Xinhua) Updated: 2012-09-25 14:16

SANTIAGO -- China's strengthened ties with developing nations in Latin America are essential for the region's economic growth, a senior official at a UN regional body said Monday.

The past decade represents "a significant era not only because of China's growing presence in the global economy, but also because of its reinforced ties with the developing world in Asia, Africa and Latin America," said Osvaldo Rosales, director of foreign trade at the UN Economic Commission for Latin America and the Caribbean.

In an interview with Xinhua, Rosales said the evolution of China's relationship with Latin America over the past decade "coincides with a structural change in the foreign trade of Latin America and the Caribbean, marked by China's growing presence in the region, both in exports and imports."

The Asian giant has grown from the region's marginal trading partner in 2000 into a highly relevant partner, especially with South American countries, Rosales noted, adding trade between China and Latin America has skyrocketed by about 22 percent annually.

"China is now the leading market for exports from Chile, Brazil and Peru, the second biggest market for Argentina, Costa Rica and Cuba, and the third biggest for most of the rest of the countries. In the area of imports, there is a similar trend," he said.

"It's not an accident that in the past decade, the region has experienced its best economic period in terms of growth, poverty reduction and even an improvement in income distribution, all of which have been closely related to the ties with China," he said.

Data released by the Organization for Economic Cooperation and Development show that the number of developing countries that can rival the growth rates of developed countries jumped from 12 between 1991 and 2000 to 66 in the following decade, Rosales said.

The increase "is largely due to China's dynamism, which has driven up trade between China and the rest of Asia, Africa and Latin America," he said.

"That has allowed...the developing world, especially our region, to withstand the global crisis unleashed in the United States, the worst crisis since the Great Depression in the 1930s," he said.

Rosales believed that without the increasingly close connection with China, Latin America would have suffered a deep recession in the 2008-2009 crisis, with rising unemployment and poverty levels and a slump of income.

The greatest challenge for Latin America, said Rosales, "is how to project this trend into the decade we are beginning now to improve the (economic) performance even more."

"Our economic growth depends more on China than on Europe or the United States," and this will probably remain for several decades because the international situation has changed," he said. "What matters most to us is what's happening in China."

Latin American countries should work together and deepen ties with China to make the most of China's growth as well as the new reality of the global economy, Rosales said.

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