Peru-China FTA to induce 10,000+ Peruvian companies to pursue exports to China

Peru and China’s bilateral Free Trade Agreement became effective March 1st.   According to officials at Peru’s Foreign Trade and Tourism Ministry (Mincetur) the agreement could potentially prompt some 10,000+ companies to begin exporting to China.  Read more about it in this article from Andina

All in all, the official message expressed by major media is that trade with China = good. I personally this doubt this is the full story. I’m pretty sure a great many Peruvian industries are not so happy they will be competing with “made in China.”

For example, I’m sure the companies which make all the cloths sold at Lima’s Gamarra Market are shaking in their boots right about now.

On the other side, as Michael Reid explains in his book, The Forgotten Continent: The Battle for Latin America’s Soul, the rise of China and other countries which offer Latin America countries alternative markets for their exports has empowered Latin America with far more freedom to develop on their own terms than every before in history.  With new markets, Latin America is no longer as heavily dependent on the United States, and China is at the center of this shift.

There’s always two sides to the story and I’m barley scratching the surface here.  I’m sure readers from Peru to China have many other reasons to argue both sides of the equation.

China-ASEAN FTA – CCTV

China-ASEAN Free Trade Agreement came into effect at the start of the new year.  CCTV9 reports:

Sino-Venezuelan Cooperation; mining and energy in focus

CSA a bit late on bringing this news to you, but it’s no less the exact kind of newsbites this website scavenges the news world for.

Mining Deal

China Development Bank Corp has agreed to provide a $1 billion usd credit line to Corp Venezolana de Guayana, a.k.a, Venezuela’s state owned mining giant and aluminium producer, in exchange for a guarantee of access to any newly discovered mining resources in the future.

China’s rolling the dice on this one.  Most of the mining world knows Venezuela is sitting atop abundant mineral wealth, nonetheless, the country has always lagged its South American neighbors like Chile, Peru and Argentina when it comes to exploiting its mineral wealth.

Dishing out $1 billion usd, in a moment when China is searching for world to secure new sources of commodities and Venezuela is desperate for dollars/ cash this is a logical investment which could pay dividends if Venezuela can provide the institutional framework to develop a robust mining industry using Chinese capital.

Energy Deals

Dec 22 (Tuesday) – Caracas and Beijing sign a framework agreement to set up and manage a new JV (joing venture) to develop the Junin 8 Block in the Orinoco Belt.  The set goal is to produce 200,000 barrels per day of extra-heavy crude, according to an official report.

Dec 23 (Wednesday) – China National Offshore Oil Corp signed agreements with PDVSA to assist with deep water and ultra-deep water drilling and to evaluate reserves in the Orinoco Belt block known as Boyaca 3.

What is China getting in exchange for this “olive branch,” it is offering Venezuela?

According to this Chinamining article,

The agreements included a one-year contract – signed by Venezuela’s PDVSA and Petro China – that calls for Venezuela to ship 500,000 barrels per day of crude and related products to China.  As for the mining agreement, China will receive supplies of iron ore for their generosity.

Asia in Focus

APEC nations call for free trade

Nov 14 (REUTERS) – APEC leaders tackle climate change negotiations and economic integration, as Japanese Prime Minister Yukio Hatoyama stresses the need for free trade zone.
Penny Tweedie, Reuters

Obama seeks stronger links in Asia

Nov 14 (REUTERS) – United States President Barack Obama pushes for greater U.S. involvement in Asia, welcoming a “strong, prosperous” China.
Penny Tweedie, Reuters.

China to lead Somalia piracy fight

Nov 13 (REUTERS) – China will assume a leadership role in an international coalition fighting maritime piracy off Somalia, signaling its navy’s growing ambitions beyond Chinese waters.
Stefanie McIntyre reports.

New world food crisis looms – Reuters

Nov 12 (Reuters) – The U.N. is warning the world is on the brink of another food crisis ahead of a major international summit in Rome.

Paul Chapman reports.

A valuable bridge between Latin America and China

[Source] - Andean Development Corporation

• The CAF President, accompanied by an official delegation, visited the Asian country to deepen trade and investment links between Latin America and China.

• The Corporation is playing its characteristic catalytic role attracting funds from other latitudes for the progress of the region.

CAF President & CEO Enrique Garcia visited Peking, accompanied by a delegation from the Corporation, with the objective of deepening trade and investment ties between Latin America and China.

The working agenda included CAF participation in the Latin America-China Investors Forum (LA-CIF), organized by Latin Finance Magazine, along with a series of meetings with China Development Bank (CDB), EximChina, China Construction Bank, Industrial and Commercial Bank of China (ICBC), and Sinocapital, among others.

Promoting investment and trade between the two regions

At the LA-CIF Forum, CAF President Garcia, along with the president of HSBC China, Richard Yorke, and the deputy governor of the China Development Bank, Jian Gao, was one of the keynote speakers at the inaugural session which was attended by a large number of business leaders, bankers, investors, government representatives, academics and media.

During his remarks, Garcia spoke of the important role that China is playing in the current international economic and financial situation and its contributions to mitigating the effects of the global crisis. He emphasized the complementarity of the economies of the two regions and the positive impact which China’s accelerated growth has had on Latin American investments and exports.

He underlined the enormous potential of bi-regional relations and CAF’s interest in deepening them with a view to building a valuable bridge between Latin America and China. “The Corporation is committed to supporting Latin American countries in opening of new horizons in Asia and strengthening a long-term integrated development agenda. Its catalytic role will help attract new actors to channel additional resources, both economic and technological, in order to achieve sustained development and move toward stronger economies stimulated by competitive advantages.”

China Development Bank: a strategically

One of the most important high-level meetings held by the mission was with the China Development Bank Corporation (CDB), represented by its Governor Chen Yuan.

The two institutions, based on the excellent level of relations and successful joint work which has led to increased knowledge of China and of Latin America, agreed to sign a new cooperation agreement in the near future. The accord will define new lines of credit; move forward with cofinancing operations to benefit small, medium-sized and large enterprises; set up a trust fund; and promote exchange of personnel.

“Through CAF we have come to know more about Latin America,” Governor Yuan said. “We recognize the potential which the region represents and we have worked hard to make this into real cooperation. CAF is the best partner for us.”

Garcia said bilateral relations began in 2006, following identification of a series of common interests. He expressed his satisfaction that CAF had contributed to the important work which CDB is doing in Latin America, and the joint financing of projects in the region. “Our activities during this visit to China – the CAF president concluded – mean we are playing a catalytic role by contributing ideas and resources from other regions in favor of regional development.”

New steps in expanding relations with China Eximbank

As part of its strategy of deepening relations with Asia, the CAF mission also met with the Export-Import Bank of China (China Eximbank) which has become an important source of financing for capital goods, technology and infrastructure projects around the world.

At the meeting, the two institutions reaffirmed their interest in working jointly in areas of common interest. They agreed to sign a framework cooperation agreement in the near future which will cover lines of credit and joint operations with a view to actively promoting trade and investment initiatives in the framework of horizontal cooperation between developing countries.

Sino-African Cooperation in focus

Two serparate newsbites have just hit the Reuters wire.  The first, describes the success many African immigrants in China have experienced since moving to the Middle Kingdom (China).  The second outlines how China’s trade with Africa is increasing and how China will likely a extend a new $5 billion credit line to Africa.

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Africans in China look for success

Nov 4 (Reuters) – A news anchorwoman and a nightclub DJ join other young Africans finding success in China.

Kitty Bu reports.

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China-Africa trade, ties grow

Nov 5 (Reuters) – Chinese President Wen Jiabao is expected to offer Africa at least $5 billion in credit and loans at an upcoming summit.

Kirsty Basset reports.

Chile stands up for fellow developing nations

South-South Cooperation politics at their finest according to CSA.   Chile made headlines on various news sites this afternoon when president, Michelle Bachelet announced she wants to see China, Brazil and India have a greater role in the International Monetary Fund and the World Bank.

President of Chile - Michelle Bachelet

Today, with a few choice words, Bachelet propelled her country into global headlines on sites like Bloomberg– which usually prefer to focus on Brazil & Mexico’s stock markets, how Argentina’s political system is a mess, or when miners go on strike in Chile or Peru… Or when Huge or Evo do something which is worthy to flash on major cable news.

Click here to read a Bloomberg article which touches upon a few different elements of Bachelet’s trip to Asia, not covered here in this post.  Instead, CSA has focused on what Bachelet said in regard to China, Brazil and India’s.  Summed up with the following excerpt (taken from the same Bloomberg article linked above).

Before the recent global slump, the Washington-based bodies “were not representative of global realities,” she said. “There are countries like Brazil, India and China that are world powers and economic powers and that have very little representation.”

Bachelet also questioned the custom that the president of the World Bank always comes from the U.S. while leadership of the IMF goes to a European.

The lack of representation from developing countries at global institutions has contributed to several crises, Bachelet said, such as the record high prices of wheat, corn last year.

China’s Africa goals more than just natural resources – Reuters

~ Gavin Coates

BEIJING (Reuters) – Barely a month goes by without some new energy or mineral deal being struck between China and an African nation. These deals have transfixed the West, but China gets far more from the relationship than raw resources.

Africa offers China two important things — a chance to earn the global respect it believes it deserves in recognition of its growing economic clout, and friends who do not judge it, or who at least have little reason to directly fear China’s rise.

China’s friendly relations with Africa go back decades, to when Beijing backed newly independent states as well as liberation movements. The continent’s backing was vital in getting China into the United Nations in 1971.

“You could argue that the contemporary driver is economic, but they’ve always had a political interest in Africa, from the mid-1950s onward,” said Chris Alden, an Africa expert at the London School of Economics.

“As China becomes a more active player in multilateral affairs, it recognizes it needs partners, and Africa in many ways is a very suitable partner.”

In 2006, President Hu Jintao promised a leap in investment, trade and aid at Beijing’s first summit with African leaders. At the G20 summit of big developed and developing economies last November, he raised Africa’s needs during the global economic turmoil.

Click here to read the complete article written by Reuters reporter Ben Blanchard

Newswire: Asia-Pacific

international.gc.ca

U.S.’s Treasury’s Geithner to attend Singapore APEC meeting – Reuters

WASHINGTON, Oct 23 (Reuters) – U.S. Treasury Secretary Timothy Geithner travels to Singapore to attend a meeting of finance ministers who are members of the Asia Pacific Economic Cooperation forum for one day next month.

China Minmetals eyes gold mines in Australia, Canada – Reuters

* Company to start construction at Peru copper mine next yr

* Production at Peru mine scheduled to begin in 2012 (Adds background, bylines)

By Rujun Shen and Joseph Chaney

TIANJIN, Oct 22 (Reuters) – Chinese state-owned metals trader China Minmetals Corp. [CHMIN.UL] is looking to buy gold mines in Australia and Canada, a senior executive said on Thursday.

Huang Dongmei, deputy general manager of China Minmetals Exploration and Development Ltd, made the remarks at an industry forum in China’s port city of Tianjin.

Separately, a Minmetals executive at the China Mining conference here said on Wednesday that the company would launch construction at its Galeno copper mine in Peru next year, with production due to start in 2012. [ID:nPEK200915]

Ecuador Seeks Cash to End Three-Year Oil Output Drop (Update1) – Bloomberg

Oct. 27 (Bloomberg) — Ecuador, the smallest member of the Organization of Petroleum Exporting Countries, is seeking to attract investment from state-run companies in Latin America, Russia and China to reverse a three-year drop in crude output.

Ecuador is forging alliances to explore and produce crude as lower investment by privately-owned companies causes production to drop as much as 6.6 percent this year, Julio Gonzalez, undersecretary of hydrocarbons policy at the Ministry of Non-Renewable Natural Resources, said in an interview.

“The government’s priority is to do this with state companies,” Gonzalez said yesterday at the ministry in Quito.

Kevin Rudd’s vision for Asia-Pacific community evolves – The Australian

KEVIN Rudd’s concept of an Asia-Pacific community by 2020 has been canvassed at the weekend’s East Asia summit in Thailand together with a rival vision from new Japanese leader Yukio Hatoyama.

East Asian leaders meeting in Hua Hin yesterday discussed the broad regional architecture, with the Prime Minister promoting his plan both at the formal leaders’ meeting and in a series on bilateral discussions.

“What I detect across the region is an openness to a discussion about how we evolve our regional architecture into the future,” Mr Rudd said yesterday.

“It’s important that we are in a conscious discussion and a conscious process to evolve options for regional institutions in the future rather than just sitting back and waiting for big problems to emerge.”