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Chinese investment rises in Latin America

(Xinhua)
Updated: 2009-05-28 14:31

Executive Secretary of the Economic Commission for Latin America and the Caribbean (ECLAC) Alicia Barcena said in Santiago Wednesday that Chinese investment in Latin America is showing substantial increases.

"Although it represents a small figure, it is important in certain sectors like mining, hydrocarbons and the auto industry," Alicia Barcena told Xinhua while presenting ECLAC's annual report on regional investment.

"There are promising hopes for Chinese investment in the near future," she added.

She cited China and Brazil's recent agreement for China to invest $10 billion in Brazil's national energy company Petrobras over the next five years to support its exploration in the Atlantic. China also signed bus sale deals with Cuba.

"China's strategy is to invest via third-party nations, and has invested substantially in hydrocarbons, showing it is interested, a fact related to its own energy demand," Barcena said.

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In the report, ECLAC also cited the deals that the Aluminium Corporation of China reached with Anglo-Australian mining giant Rio Tinto to invest $19.5 billion in its Peruvian mines, and ChinaMetals agreed with Australia's Oz Minerals to invest $17 billion in its mines in Latin America.

Developed nations, especially the United States, remain the region's main investment sources, but investment from developing countries, led by those from Asia, is rebounding. China accounts for about 50 percent of the investment, the report said.

Regional foreign direct investment was around $128.3 billion in 2008, a record figure despite the world's financial crisis. However, the figure is estimated to drop as much as 45 percent this year, due to the prolonged financial crisis, said the report.