Presidents and First Ladies of China and Ecuador, this week
❝ An expected U.S. economic retreat from Latin America under Donald Trump is causing the region’s leaders to look halfway around the world, to China, for help weathering the possible financial headwinds.
They’ll have the perfect opportunity to make their appeal this week when Chinese President Xi Jinping attends a Pacific Rim summit as part of a visit to Ecuador, Peru and Chile…
❝ Over the past decade China has displaced the U.S. as the main trading partner in country after country in Latin America as demand for the region’s soybeans, oil and iron ore fueled the fastest growth in decades. But more recently, as China’s demand for raw materials has been slowing, the region’s economies have taken a hit, dampening the once-torrid love affair with the world’s second-biggest economy.
❝ Margaret Myers, a China expert at the Washington-based Inter-American Dialogue, said that most South American countries have awoken to the pitfalls of dependence on commodity exports and would prefer closer ties to the U.S., which buys the sort of manufacturing goods that generate more jobs.
“But the question is whether the U.S. will reciprocate,” she says. “Nobody in the region is expecting much from Trump in terms of really productive policy. That leaves room for China to play a much more important role.”…
❝ To be sure, a U.S.-China trade war would have ripple effects across Chinese industry that would also depress demand for Latin America’s raw materials.
But for now Chinese businessmen attending the APEC summit see nothing but potential.
As far as I can see – in the view from Lot 4 – China’s foreign policy is more likely to result in mutual growth. Certainly, a predictable difference between investing nations whose “long-term” view means the next election, if not the next quarter – on one hand – and investing nations and parties concerned with a five to ten-year window of change. Usually, progressive in being focused on stable growth.