China helps partners upgrade economies

China's main imports from Latin America have been oil, ore and grains, which are no longer as attractive for China because of the drop in the prices of staple commodities and the trouble being faced by China's manufacturing industry owing to overcapacity and weaker demands.

The decline in exports has reduced Latin American countries' revenues, and exposed some structural problems of their economies and their inadequate infrastructure. In these circumstances, the old China-Latin America cooperation model cannot be sustainable and has to make way for the new model proposed by Li.

The four countries Li visited account for 57 percent of the trade between China and Latin America. But the four countries need investments, better technologies and management experience from China to improve their railways, roads, harbors and airports, and develop their manufacturing industry. Moreover, China can also help these countries produce and export more value-added products, restructure their economies and make them more competitive in the global market.

China's investments will help Latin America reduce its dependence on the exports of raw materials and staple commodities and focus more on industries and infrastructure construction. And the $10-billion Brazil-Peru railway project connecting the Atlantic and Pacific oceans, once completed, will hugely improve regional connectivity.

The trade between China and Latin America has increased 21-fold in the past decade. China is now the largest trade partner of the region after the United States.

The region has become an important part of China's global partnership network. This calls for China to maintain a good balance among its trade partners in Latin America, because some of them are also competitors of each other.

The author is a member of Charhar Society, a think tank based in Shangyi, Hebei province.

(China Daily 06/06/2015 page5)