Source: Global Times Published: 2016-11-24
President Xi Jinping`s visit to Latin America has given fresh impetus to China`s relationship with the continent at a time when the US is expected to become increasingly protectionist under the administration of President-elect Donald Trump.
On Xi`s last stop of the trip, China and Chile agreed Tuesday to upgrade bilateral ties to the comprehensive strategic partnership level and enhance the free trade agreement between Chile and China. Chile was the first Latin American country to sign a free trade deal with China.
Chile is also willing to join the China-initiated Asian Infrastructure Investment Bank as soon as possible, and to conduct closer coordination and cooperation with China on international affairs, said Chilean President Michelle Bachelet during her meeting with Xi, adding that Chile welcomes Chinese enterprises to increase their investment in the Latin American country.
Before Chile, Xi visited Ecuador and Peru, and attended the 24th Asia-Pacific Economic Cooperation Economic Leaders` Meeting in Lima, Peru.
"Xi`s trip to Latin America marks the best era for the relationship between China and this continent, and these relationships are developing quicker than ever," Guo Cunhai, deputy director of Latin American Studies at the Chinese Academy of Social Sciences, told the Global Times on Wednesday.
Chilean Ambassador to China Jorge Heine said that bilateral trade has increased fourfold in the past decade. From 2005, when Chile signed the free trade agreement with China, to 2015, trade has increased from $8 billion to $31 billion, Heine told the Global Times in early November.
The friendship between China and Latin America can be traced back to when China was isolated by the West due to ideological reasons. Chile was the first country to establish diplomatic ties with China in South America in 1970, as well as the first Latin American country to sign a bilateral accord with China on the latter`s accession to the World Trade Organization and to recognize China`s status as a market economy.
There is an urgent need for Latin American countries to deepen their cooperation with China as some of the emerging economies in the continent are feeling the full brunt of the global economic slowdown, according to analysts.
Countries like Brazil and Venezuela, which had seen rapid development, have slid into economic downturn and suffered political unrest.
The tough economic situation for some Latin American countries is mainly caused by price fluctuations in bulk commodities, on which these countries are heavily reliant, and also because their manufacturing and industrial sectors are undeveloped, Guo said.
Donald Trump`s success in the US presidential election has brought more uncertainty to Latin America`s prospects for development. "During the Obama era, Latin America expected the US to solve the problem, such as the US-led Trans-Pacific Partnership (TPP), which would have created opportunities for free trade, so Latin American countries could sell bulk commodities to the US without tariffs," said Guo.
"But now Donald Trump says he will withdraw the US from the TPP, and his immigration policy will also affect US relations with Latin America, so at this moment, Latin America needs China more than ever," he said.
China can play a part in infrastructure building and investment, which Latin American countries desperately need as they try to improve their economic and industrial systems, said Wan Zhe, chief economist at China National Gold Group Corporation.
"Although the situation is tough for us, it`s also an opportunity for both sides to upgrade and strengthen ties," Wan said.
Wan said the US is the main external factor that will impact the development of the China-Latin American relationship. "Although US Secretary of State John Kerry declared that the era of the Monroe Doctrine was over in 2013, the US still sees Latin America as its traditional sphere of influence," he said.
"Kerry`s statement shows a `New Monroe Doctrine,` due to the rise of left-wing and anti-US politicians in the continent. The US is trying to stop this trend, which means the US still treats Latin America as its backyard, but measures to maintain its control are becoming smarter and more flexible," Guo said.
In the past, the US was worried about military cooperation between Latin America and China, and China explained the cooperation was focused on the economy, "however, due to the fast increasing trade volume, the US is still worried about the cooperation between China and Latin America," he said.
Wan said that another reason is Latin America`s own culture and politics.
"Many Latin American countries` political situations see occasional instability, and countries on the continent are also divided on some issues," he said.
For instance, China is trying to push for the construction of a Pacific-Atlantic railway network, but Peru said that while Brazil would benefit, it prefer a domestic railway network, Wan said.
Wan Zhe is a visiting fellow of Chongyang Institute for Financial Studies at Renmin University of China.