China and Latin America: Investment and Trade Flow
Nov 1, 2009
As Chinese investment increases, LatAm tries to be more than just a cheap supplier of raw materials. Skeptics are wary of China’s track record in other regions.
by Ben Miller
With a capacity of 1,500 megawatts, the Coca Codo Sinclair hydroelectric dam will be expected on completion to supply about 70% of Ecuadors electricity needs, potentially freeing it from needing to import power. After Ecuador stiffed international markets with a messy restructuring, raising almost $2 billion for the project straddling the Coca River near the Colombian border seemed a tall order. However, China has eagerly stepped in.
Four international companies bid, but only the two Chinese companies presented financing, and one of those withdrew, leaving Sinohydro, says Italo Centenaro, general manager of Coca Codo Sinclair, the Ecuadorian government-owned project company. Sinohydro, Chinas largest hydroelectric builder, signed a contract in early October to build the project and brought with it a $1.7 billion 15-year loan from the Export-Import Bank of China.
The Chinese Exim loan has a 6.2% interest rate...
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