Del canal Argentino – Infinito

Article 1: Russia Lends Venezuela $4 Billion in Return for Oil Projects - By Daniel Cancel of Bloomberg News

Russia agreed to lend Venezuela $4 billion through 2013 for defense spending in return for gaining access to heavy crude and offshore gas fields in the South American country.

Russia’s OAO Rosneft and OAO Gazprom signed a cooperation accord with Venezuelan state oil company Petroleos de Venezuela SA late yesterday at a ceremony in Caracas led by President Hugo Chavez and Russian Deputy Prime Minister Igor Sechin.

“We’re working on large-dimension projects from oil, gas and petrochemicals to finance, banking and trade,” Chavez said on state television.

Click here to read the full article direct from the Bloomberg

Article 2 = China’s JAC Motors to build plant in Brazil - By Vivian Pereira and Brad Haynes of Reuters News

To Note:
* 80 pct of capital will come from local SHC Group
* Government driving up the cost of imported carsBy Vivian

Pereira and Brad HaynesSAO PAULO, Oct 7 (Reuters) – The Brazilian operator of China’s JAC Motors brand announced a 900-million-real ($510 million) investment to build a factory producing affordable cars in the world’s No. 4 auto market.

JAC Motors will provide 20 percent of the capital, with the rest coming from the local SHC Group run by businessman Sergio Habib, SHC said in a statement on Friday.

The plant in Bahia state, expected to produce 100,000 vehicles annually beginning in 2014, will be the second producing Chinese-branded cars in Latin America’s largest economy, where authorities are pushing up the cost of imported cars.

Click here to read the full article direct from the Reuters News

Article 3: Friction between China & Bolivia

Bolivian energy minister alleges deception by Jindal Steel in big iron ore mining deal, courtesy of the Associated Press via the Washington Post

LA PAZ, Bolivia — A senior Bolivian official is threatening to end the government’s contract with India’s Jindal Steel & Power Ltd. over its alleged failure to meet investment commitments in a huge iron ore mine.

Energy Minister Jose Luis Gutierrez says Jindal deceived Bolivia in failing to honor its end of the biggest mining investment of President Evo Morales’ nearly six-year tenure.

Click here to read the full article direct from the Associated Press via the Washington Post

Article 4 = Ecuador firm wants to sell rice in the name of Gandhi - By Maneesh Chhibber of the IndianExpress.com

An Ecuador-based company has attempted to use the name and photograph of Mahatma Gandhi for marketing its rice. But an Indian lawyer has challenged the move before the Trademark Office of Ecuador. The case is scheduled to come up for hearing tomorrow.

According to Lalit Bhasin, who is also president of the Society of Indian Law Firms, the owner of the Ecuadorian company, Valverde Munoz, applied for grant of trademark for the name and label of “Arroz Gandhi” (Arroz means rice).

Click here to read the full article direct from IndianExpress.com

Article 5: Mitt Romney on Mexico, China and defense – By Dr. James M. Lindsay and courtesy of CNN News

Dr. James M. Lindsay you would think knows about the topic, as CNN makes a special point to note — Dr. James M. Lindsay is a Senior Vice President at the Council on Foreign Relations and co-author of America Unbound: The Bush Revolution in Foreign Policy, and whom writes his own blog, which you can access by clicking here.

By James M. Lindsay, CFR.org

Mitt Romney has taken exception to Rick Perry’s comment over the weekend that he would consider sending American troops into Mexico to help end the drug war raging there. Romney told the New Hampshire Union Leader that Perry’s suggestion is “a bad idea:”

Let’s build a fence first, and let’s have sufficient border patrol agents to protect it. And if the Mexican government wants us to help it with logistics, intelligence, satellite images, I’m sure we can provide the sort of support we provided in Colombia.

You can expect to hear more about Mexico at next Tuesday’s GOP debate. If Romney makes the Colombia comparison again, he probably should explain what the United States did there. Most people don’t know.

Click here to read the full article direct from CNN

Every day Luis Castilla, Peru’s finance minister, says he lights a candle and “prays that China won’t crash”.

His prayers are echoed by many in a region that remains one of the world economy’s few bright spots. South America’s commodity-rich economies grew 5 per cent in the first half of this year. Last year, these new motors of the world economy added half a percentage point to global output.

But slowing Asian demand and plunging commodity prices have raised the spectre that South America, having largely escaped the 2008-09 Great Recession, may not be so lucky this time around.

Main point = Potential new financial crisis in the “Developed World” + slow down in China = Scared Latinos

Click here to read the full article direct from the Financial Times

The Western media continually criticizes China’s role in Latin America as being “neocolonial” and claims it has an “insatiable demand for commodities”, so I was keen to observe the people’s attitude toward China during my trip to the region recently.

Judging from the enthusiasm for China displayed by government officials, businessmen, academics and ordinary people in Chile, the picture presented by the Western media has been seriously distorted.

At the UN Economic Commission for Latin America and the Caribbean, chiefs and experts attributed the fast trade and investment growth from China as a key factor for Latin America not only surviving, but thriving during the global financial crisis.

The same message was heard from top Chilean officials at the 5th annual meeting of the Chile China Business Council, which drew some 500 government officials and business people.

It is true that commodities are an important part of the trade between China and Latin America. However, that trade benefits not only China, but also Latin America and the rest of the world.

By being the world’s manufacturing workshop, China has paid a high environmental cost. Just half a century ago, that job was done in most of today’s developed countries when they were the global manufacturing center.

Many developed countries have an insatiable demand for China’s rare earth and, of course, the country’s cheap labor. But this never seems to bother the Western media.

In fact, China and Latin America are quickly diversifying and elevating their trade and investment as witnessed by the host of agreements signed by China and Cuba, Uruguay and Chile in the past few days.

China has already become Chile’s largest trade partner. Chinese businesses are increasing their presence in the South America country. The billboards on Santiago streets by automaker BYD and appliance firm Haier, and the Chinese businessmen who do trade, operate malls and run convenience stores are proof of China’s presence.

Both countries share a priority in development. Chile aspires to become a developed country and China wants to become a xiaokang (well-off ) society.

Chilean President Sabastian Pinera made constant reminders that the two countries are very close despite the geographical distance between them.

The mood among the ordinary people I met in Chile was also favorable to China. I have never heard the word “Welcome” as often as I did in Chile. Ordinary Chileans I met in cafes, museums, parks in Santiago and Pablo Neruda’s colorful and hilly neighborhood in historic Valparaiso greeted me with “Welcome to Chile”.

What Pinera said was true. China and Chile are very close. In South America, Chile was the first country to recognize China’s market economy status, the first to sign a free trade agreement with China, the first to establish diplomatic ties with China and the first to support China’s WTO accession.

Of course, China and Latin American countries, all belong to the developing world and are going to compete with each other. But we all know that competition is a good thing and there is no need to distort the picture simply because of competition.

Latin American nations are independent countries and they are no one’s backyard. For China and Chile, they are really neighbor countries separated only by the Pacific. You can literally fly from Beijing to Santiago without passing over any other country.

Presidents Dilma Rousseff and Hu Jintao in China last month can celebrate rising two-way trade. (Photo: Roberto Stuckert Filho/PR)

China’s trade with Latin America is growing twice as fast as U.S. trade with the region.

BY RUTH MORRIS of the The Latin American Business Chronicle

SHANGHAI — China’s dragon breathed fire into Latin America in 2010, as trade between the two sides shot up by a spectacular 51.2 percent, to $178.6 billion, and memories of the economic recession melted away.

China’s trade with Latin America is growing at nearly twice the level of US trade with the region. It also is significantly higher than the 31 percent increase in trade between the European Union and Latin America last year.

Click here to read more direct from the Latin American Business Chronicle

Img: Courtesy of Wikicommons

Andina News Agency has just reported (technically announced) the 5th China-Latin American Business Summit will be held in Lima this year:

Lima, Mar. 30 (ANDINA). The Peruvian capital will host the 5th China-Latin American Business Summit to be held from November 21-22 this year at The Westin Libertador hotel, the China Council for the Promotion of International Trade (CCPIT) reported.

CCPIT Latin America and Oceania Department Director Lei Hong said that Peru was chosen as the venue because of the recent Free Trade Agreement (FTA) signed with China, which is why Peru’s Foreign Ministry is organizing the event.

According to her, some 300 entrepreneurs from the Asian giant attended the previous editions, and a similar amount is expected for this year’s summit.

In addition, an exhibition of products from China and other participating countries, as well as business roundtables and meetings among CEOs will also take place.

The previous business summits have been carried out in Santiago (Chile), Harbin (China), Bogota (Colombia), and Chengdu (China).

Dr. Gallagher is a Professor at Boston University in International Relations and is faculty coordinator for Boston University’s Global Development Policy Program. Furthermore, In 2009 he served on the investment subcommittee of the US Department of State’s of the Advisory Committee on International Economic Policy. Professor Gallagher writes regular columns on global economic and development policy for The Guardian, Financial Times, and POLITICO.  He co-chairs the Triple Crisis blog.

In the roughly 30 minutes we talked, we discussed

What motivated you? Dr. Gallagher to write the Sino-Latin American dynamic and motivated him to write The Dragon in the Room: China and the Future of Latin American Industrialization

Mr. Gallagher’s inspiration emerged from the 3 years he spent living in Guadalajara, also known as Mexico’s Silicon Valley.  During his time in Mexico, it became very clear there was a “new kid on the block.”  When speaking with Mexican professionals, the US market and future significance for the Mexican economy had to Mr. Gallagher’s surprise taken a back seat to the emergence of China.

It was around this time in 2005, Dr. Gallagher began to investigate what the rise of China meant for both Mexico, and the greater Latin America region.  Would China’s high speed growth and fast rising competitiveness undermine Latin America’s capacity to develop their own competitive industries, or would China’s rise breed new possibilities and growth in Latin American countries?  This formed foundation for his book, which you can click here to purchase a copy of.

Next we discussed the general importance of the growth of Sino-Latin American relations and trade.

Similar to the perspectives often presented here at ChinaSouthAmerica.com, Dr. Gallagher feels the rise of China and its penetration in Latin America comes with a significant amount of uncertainty for the region, offering both opportunities and dangers.  The opportunities are clearer for some countries than others.

For major commodity producers down in South America; Venezuela, Peru, Chile and Argentina the rewards are being felt tangibly, and NOW.  China has presented itself as a new market for their raw materials exports, and Chinese demand has helped push the prices of raw materials to record highs.  However, the danger is that history may well repeat itself if the income generated from selling raw materials to China are not re-deployed efficiently and strategically to create sustainable, globally competitive industries.

The panorama for Mexico and Brazil, Latin America’s economic giants share some similarities because both countries have well a relatively broad range of developed, competitive industrial sectors.  In this case, China is a challenger to their own industries.  The positive and negatives effects of being forced to compete with their Chinese counterparts is debatable, but thus it seems Mexican and Brazilian companies have managed to meet the challenge and it seems Chinese competition will in the long-run catalyze innovation and economies of scale.

On the other hand, there are also major differences for Mexico and Brazil when considering China.  The major difference, and one that is impossible to overlook, is undoubtedly Mexico’s proximity to the United States.    Mexico competes almost directly with China’s manufacturing sector.  The major factor which will dictate how the future unfolds concerns how well Mexico can capitalize off the geographic competitive advantage of being at the door step of the world’s largest consumer market.  It will be important to monitor:

• Rising wages in China vs. Mexico.
• Raw material costs
• The total costs of producing increasingly sophisticated manufactured goods in both countries vs. total time it takes to produce and deliver the goods to the end buyers.

What’s next? Right now the majority of interaction between China and Latin America is occurring at a two levels—government to government, and major company to company.  What are your perspectives on the future of growth of a third level of exchange—that being personal ones between Chinese and Latin Americans down on the ground in both China and Latin America?  What types of opportunities does the future hold for the next generation that is able to form these links?

Like your author of ChinaSouthAmerica.com, Dr. Gallagher believes this to be the “million dollar question,” and one that is not easy to answer.  We will sadly have to wait for his next book which will focus on this question, and which your author hopes to help Mr. Gallagher answer when the time comes.

To conclude, I asked Dr. Gallagher about if he had any thoughts to share on the specific countries of Peru, Chile, Brazil, Argentina, Venezuela, Colombia– the countries which your author most closely follows.

“These are a very diverse set of countries, and I wouldn’t dare generalize across the entire set of them.  The one thing I can say about each of these is that in terms of copper (Peru and Chile), Iron (Brazil), soy (Brazil and Argentina), and crude oil (Brazil, Colombia, Venezuela) this particular set of Latin American nations and the respective commodities is very strategic for China.  China will continue to purchase imports of these commodities and to invest heavily in them.  These country’s governments should be strategic in return.  In order to get the broadest set of benefits from this new market player in China, Latin Americans have to see to it that they can also provide stable supplies over time, create jobs for their people, and manage their exchange rates so that commodities exports don’t crowd out more productive and employment creating activity.  If these nations see China as an opportunity, by bargaining hard with the Chinese and put in place parallel policies in terms of jobs, industrialization, and environmental policy, China may turn out to be a boon.“

As I am currently writing this post from China, where this book is not yet available, I unfortunately have not yet been able to get my hands on a copy of this book. In the 30 minutes I spoke with Dr. Gallagher he exhibited great insight on all that is the growth of Sino-Latin American relations and economic exchange.  I look forward to reading the book for myself after I get my hands on a copy in January when I travel to the US and South America.  If you the reader seek a rich and comprehensive analysis on the growth of China and Latin America’s relations, ChinaSouthAmerica highly recommends you pick up your own copy of The Dragon in the Room: China and the Future of Latin American Industrialization.

CLICK HERE to buy your own copy (hardcover) from Amazon.com of The Dragon in the Room: China and the Future of Latin American Industrialization

or, CLICK HERE for the soft cover edition

David Lowell - Bloomberg

In the snake-infested jungle of southeastern Ecuador, the American explorer David Lowell found himself sliding over a waterfall and heard his head bounce off a rock “like a melon being hit by a hammer,” he says.

Lowell was 72 and prospecting for copper that day in May 2000. He stepped into the slippery streambed for a vantage point free of vipers and vines. A broken rib and throbbing head diverted him to a nearby hamlet in search of help.

“There was one man in the village who was a combination chiropractor and mortician,” Lowell says. “We decided to just buy a little tin of liniment with the picture of a dragon on it.” The expedition carried on.

In the clear water of the stream, Lowell saw enough to help him find one of South America’s richest copper deposits. This May, a joint venture of Chinese state-owned companies paid $652 million to buy Lowell’s partner in the exploration, Vancouver- based Corriente Resources Inc. Lowell kept a stake there for himself, though local opposition has prevented mining.

In a career spanning six decades and 44 countries, Lowell has made 14 major discoveries, including the world’s largest copper deposit in Chile. He found treasures where others detected nothing worth mining. Lowell revolutionized exploration and unearthed metals that helped the U.S. build the world’s largest economy. He also made investors billions.

Click here to read the entire article direct from Bloomberg

President of Shandong Kerui Group Holding Corporation, Yang Xian - Andina

Andina News Agency reports Chinese corporation Kerui Group has expressed its interest in entering the Peruvian market by setting up an oil and gas equipment plant with an initial investment of US$10 million.

This supports my long standing opinion that Peru is perfectly positioned geographically, politically and economically to emerge as “China & Asia’s gateway to South America.”

The President of Kerui Group Holding Corporation, Yang Xian, seems to agree.

“This venture into our market aims to meet oil equipment demands of countries such as Colombia, Ecuador, Venezuela, Bolivia and Brazil.”

“Politics and economic activity in Peru is better than in other Latin American countries such as Venezuela. We can strengthen our presence in Latin America from there, that would be our next task.”

Yang made these comments during the visit of Peruvian entrepreneurs to 3rd China International Petroleum and Petrochemical Equipment & Technology Exhibition (CIPEE) 2010 taking place in Dongying.

Currently around 50% of Kerui Group’s annual production is exported to U.S. and other countries such as Canada, Saudi Arabia, India, Russia, Kazajstán as well as other 30 countries in Middle East, Asia and Africa.  This marks their latest move to expand their market reach.