Of Dragons & Elephants

Aug 1, 2006

China's growing influence on Latin America has, to some extent, overshadowed the rise of another emerging market giant in the East: India. By Javier Santiso*

China's economic effect is palpable throughout the world. The Asian giant's impact reaches even the most remote corners of the planet, like Africa, where it's displacing centuries-old European influence. In most of Latin America, meanwhile, China is turning into a commercial angel as it hops into what is looking less and less like the United States' backyard. Because of its focus on raw materials, Latin America is seemingly one of the most complementary regions for the Asian dragon. The value of Venezuelan crude shipments to China, for example, topped $3 billion in 2005, or twice the year before. While the US is still the biggest importer of Venezuelan crude, growing Sino-Latin solidarity, in particular between Beijing and Caracas, hasn't gone unnoticed. Likewise, Latin America is becoming a region of great interest for Chinese investors. These tighter relationships center on an overseas expansion strategy that has been adopted by China's emerging...

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