Latin America offers way out of demand doldrums

16  January 2013

Region holds ‘good opportunities’ as weakness in mature markets persists

As the demand from developed markets, especially the European Union, decreases sharply, Chinese companies should be encouraged to export goods to Latin America, says Yang Wanming, Chinese ambassador to Chile.

“Latin America is now a strategically important market for China … especially amid the European debt crisis,” he said.

 

Quality control employees conduct a final inspection at Great Wall Motors Co Ltd’s assembly plant in Tianjin. Chinese automobiles hold a 12 percent share of the Chilean market, according to Yang Wanming, Chinese ambassador to Chile. [Photo / China Daily]

 

While China’s foreign trade with some developed economies remained weak in 2012, “the rate of increase between China and Latin America ranged from 12 to 15 percent. That’s a remarkable rate,” he added.

According to the General Administration of Customs, China’s exports from January to November last year surged by 7.3 percent year-on-year, down sharply from the year-on-year growth of 21.1 percent in the same period of 2011.

In the first 11 months of 2012, China’s foreign trade increased by 5.8 percent from a year earlier, well below the central government’s target of 10 percent for the year.

The deceleration was largely a result of the European debt crisis, which has dampened demand in the EU, China’s chief trade partner. In November, China’s exports to the EU fell by 18 percent from a year earlier, showing their sixth straight monthly decline.

Yang said Latin American countries can “provide Chinese companies good opportunities to increase their exports”.

“Latin America is highly market-oriented,” he said. “Various countries, led by Brazil, Mexico and Chile, have seen their economies grow rapidly during the past few years.”

The International Monetary Fund predicted Peru, Chile and Brazil will show the strongest economic growth among Latin American countries from 2013 to 2017. Peru’s economy is expected to grow by 6 percent during the period, Chile’s by 4.6 percent and Brazil by 4.1 percent.