Showing posts with label Buenos Aires. Show all posts
Showing posts with label Buenos Aires. Show all posts

Tuesday, September 1, 2009

China's Policy Paper on Latin America and the Caribbean - MercoPress Analysis

[Source] -- MercroPress

On November 5, 2008, the Chinese government released a policy paper on Latin America and the Caribbean, as it had previously done so for Europe in 2003 and for Africa in 2006.

Although it may not come as a huge surprise that Latin America is the most recent region for which China has formally spelled out its foreign policy position, the region has been historically perceived as being under the United States’ sphere of influence. Perhaps the importance of the Chinese policy paper lies in the timing of its release. The release of the paper deliberately coincided with the unfolding of the current financial crisis; this congruence of events has allowed China to expand its influence in this somewhat neglected region without attracting any lasting venom from the U.S. China’s policy paper formally evidences the importance of Latin America and the Caribbean as part of China’s growth plan for its long-term strategic interests. Most of all, this includes access to raw materials as well as a plethora of natural resources, the infiltration of new foreign markets, the reduction of diplomatic support for the Republic of Taiwan, and the strengthening of Beijing political standing on the global stage through strong alliances cemented with the developing world.
The policy paper’s general context

The policy paper explicitly states its main objective is to “clarify the goals of China’s policy in this region, outline the guiding principles for future cooperation […] and sustain the sound, steady and all-around growth of China’s relations with Latin America and the Caribbean.” In the economic realm, China expresses an interest in investing in energy, mineral resources, forestry, fishing and agriculture, areas important to expanding China’s productivity. Additionally, the Chinese government seems to show interest in infrastructure projects not directly related to its economy, albeit essential in the transportation of natural resources, and proposes to fund these projects in order to be perceived as a partner in development. Furthermore, China expresses its desire to increase military diplomacy and sale of equipment to the region. Although many of the report’s statements are merely rhetoric and general in scope, the paper helps formalize China’s economic, diplomatic and military ties with Latin America, which were first proposed by then President of China Jiang Zemin in 2001.

The policy paper was released against the backdrop of the current financial crisis and the corresponding economic hardships that have severely hit the U.S. and Europe. Its publication deliberately coincided with the emergency G-20 meeting to discuss the economic crisis that was about to take place in Washington. More importantly, it preceded Chinese President Hu Jintao’s visit to Peru for the November 2008 Asia-Pacific Economic Cooperation (APEC) summit, at which he presented China’s foreign policy towards Latin America. This timing of the paper’s release was especially important for the countries seeking to diversify their export markets and decrease their dependence on declining Foreign Direct Investment (FDI) from the US and Europe. With the vast foreign reserves accumulated by China –which totalled US $1.95 trillion in December 2008– the region had valid reasons to closely follow the summit’s developments.

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Friday, August 28, 2009

Argentina could potentially attract $10 billion to its stock market if restrictions are lifted, reports Bloomberg

Argentina’s stock exchange called on the government to lift capital controls that caused it to become the only major Latin America market classified as “frontier,” adding the move may help lure $10 billion in foreign investment.

A requirement for international investors to deposit 30 percent of what they put in Argentina with the central bank for a year “have stopped making sense,” Adelmo Gabbi, the Buenos Aires stock exchange’s chairman, said yesterday in a speech.

Capital controls prompted MSCI Inc. to remove Argentina from its benchmark emerging-market index in June, assigning it the so-called frontier status along with the world’s least developed markets. The controls have helped Argentina avoid volatility, said President Cristina Fernandez de Kirchner.

Argentina's stock exchange, Buenos Aires
Image courtesy of Business Week


“We have to seek a rule so that the inflow of funds won’t be speculative,” she said, without elaborating.

...

“The deposit requirement was imposed in 2005 and was one of the forces that allowed us to confront the brutal volatility of the markets during the crisis,” Fernandez responded yesterday in a speech at the Buenos Aires stock exchange.

Fernandez’s husband and predecessor Nestor Kirchner imposed deposit requirement in order to discourage speculators from investing in local markets after the country restructured about $104 billion in bonds...


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Monday, March 30, 2009

Vice Prez, Joe Biden says "US moving towards new day in Latin America

La Nacion, a Buenos Aires based newspaper published a interesting op-ed piece today, which the Latin American Herald (access their article here).

Biden stressed the importance of the Progressive Governance conference which he is currently attending in Chile.


Joe Biden with a few South American heads of state

Biden also had the guts to acknowledge much like Hillary Clinton did in Mexico the other day that the United States must “do more” to reduce the demand for illegal drugs and stop the arms trade."

He congratulated “Mexico’s brave stand” against drug cartels and the “efforts” of Colombia to combat drugs, but warned that these “will have the secondary effect of pushing traffickers towards Central America.”

“The world economic crisis has affected almost everyone. Citizens of all countries are looking for answers, looking for hope, and for that they turn to their leaders. It is our duty, as partners, to listen to their plea and together forge the solution to a shared problem, explained Biden.”