Chinese appetite benefits Latin American export-related sectors

BEIJING - In the week prior to the Chinese Lunar New Year, Casti Beef, a Uruguayan brand targeting the high-end consumer market, sold 26 tons of premium meat in China.

In the past four months, a total of 45,000 metric tons of Uruguayan beef was sold by various brands in China, Daniel Castiglioni, general manager of Casti Beef, told Xinhua in a recent interview.

"With a growing middle class who have more money to spend, China has a steady demand for agricultural produce and is paying higher prices every year," said the Montevideo-native businessman.

Castiglioni, 35, has been working in China for eight years and has witnessed the country's growing consumption market benefiting Latin American export-related industries.

The incessant Chinese craving for more and better food has been "increasing the incomes of the industry, the farmers, and all the people around the business," he said.

Uruguay was one of the first from Latin America countries exporting beef to China. It has become a favored choice for the local consumers over the past 15 years.

And it is not just beef.

In recent years, Chinese consumers have been enjoying a whole variety of flavors from Latin America. They make salads with Mexican avocados, fry Chilean salmon fillets or savor them raw as sashimi, make toasts raising glasses of Argentinean wine, and wrap up the meal with desserts made of Peruvian grapes.

The world's second largest economy has been translating its GDP growth into higher per capita income, and Chinese consumers' pursuit of safe, healthy food has provided fresh opportunities worldwide, and in particular for Latin America.

In Peru, exports generated 2.1 million jobs between January and September last year, according to the country's Association of Exporters (ADEX).

Of that, agricultural product exports was the sector that created the most jobs: 726,900, with a yearly increase of 8 percent.

China currently ranks 10th in terms of volume in Peru's agricultural export markets and has yet-to-be-explored potential, said ADEX. Since Peruvian avocados arrived on the Chinese market, the product has shown exponential growth in shipments to the Asian country in just a few years.

"It is a market with enormous potential because of the number of consumers that it has, whose purchasing power improves every year," ADEX's agro-exports manager Paula Carrion said.

ADEX foresees that the agro-industry will continue to generate more employment this year, with an estimated 1.3 million jobs, 15 percent more than in 2017.

"This is because exports have a multiplier effect. Directly, because of the immediate impact on the sectors; indirectly, because they impact other productive branches," said Carlos Gonzalez, director of ADEX's Economy and Global Business Research Center.

On the other side, the increase in exports generates a greater demand for goods alongside the improvement of the purchasing power of the workers, he added.

Over the past two decades, China's trade, investment, and infrastructure projects have created 1.8 million jobs in Latin America and the Caribbean, according to an International Labor Organization report released last year.

The study shows that the number of jobs created under China's economic influence from 1995 to 2016 represented 4 percent of the total in the region. Around 65 percent of the China-related new jobs were in trade.

"Today, China has generated nearly two million jobs in Latin America," said Enrique Dussel Peters, co-author of the report and coordinator of the Center for China-Mexico Studies at Mexico's National Autonomous University.

"Mexican fruit and vegetable producers can reap the benefits if they take the time to explore, develop, and promote their products and brands in China," said Nancy Tucker, vice president of Development for Global Businesses of Mexico's Produce Marketing Association.

"China's continued economic growth and the expanding middle class make the country a profitable new market for Latin America," she told the Mexican exporters during a seminar on the Chinese market held in December.

While many countries have moved to cater to the enormous demand of Chinese consumers with the best produce each has to offer, Latin American agro-exporters said they do not fear competition.

"The market is big enough for everyone," asserted Castiglioni.