Goodwill and Big Expectations
The China-Latin America Business Summit in Lima was held Nov. 20 and is expected to generate a great deal of goodwill between the two regions. This will hopefully lead to increased exports for Latin American companies and drive the push for in-country JV’s.
Peru is poised to receive the most benefits among the Andean nations because of its favorable scores on various fronts— especially their economy. The Peruvian economy grew 8.98 % in 2010 and has experienced 6% growth for more than 10 years. Peru has also held inflation to a rate between 2% and 3% per year, has a stable exchange rate, and foreign currency revenues worth 49 billion USD. Aside from the favorable economic indicators, Peru enjoys a moderate, democratic government, an abundance of exclusive natural resources and has spearheaded this trade initiative by hosting the event!
Peru is also becoming the “trade agreement power house” with 13 free trade agreements, five more expected to take effect soon and still another five in negotiations! As a result, Peru has achieved the "investment grade" status by international rating agencies. Additionally, experts have estimated total Chinese investment in Peruvian mining, hydrocarbon and fishing to equal about 2.2 billion USD!
Spreading the Wealth Around?
Colombia is also slotted to benefit from the forum because of its sheer size—about 42 million, and its right-leaning government. Petroleum and other natural resources are found in large quantities but despite recent strides in eradicating the subversive movement, Colombia’s safety record is still in question.
Unfortunately, for the rest of the Andean countries who lean to the left, China is more concerned these days with establishing bilateral trade agreements with economically stable countries than they are with cutting deals with other leftist regimes. So for the time being, Venezuela, Bolivia and Ecuador will not be invited to the Asian ball!
Interested in learning more about the Andean markets and possible export opportunities for your products and services? Contact us.