During a forum organized by the Atlantic Council to launch a report that unravels the complexities of the Latin America-China relationship, Peter Schechter, director of the Center for Latin America of the American Council, said, “The relationship between Latin America and China has changed dramatically in recent years, from one based on the flow and consumption of raw materials, to one focused on the expansion of foreign direct investment,”
When asked about the relationship between China and Latin America in the steel market, Martin Berardi, president of the Latin American steel association Alacero, expressed the great concern of the steel and metal-mechanic sectors about the massive arrival under unfair trade conditions of products originating in China. “Chinese steel exports to Latin America will reach 9 million mt this year, equivalent to 13 percent of the regional steel consumption. These shipments have grown 70 percent in just two years. The huge installed overcapacity in the Chinese steel industry (425 million mt, equivalent to 6.6 times the annual output of Latin America or four times the annual US consumption) plus the “zero profitability” of the Chinese state-owned steel companies demonstrate that China is NOT a market economy,” he added.
Mr. Berardi also referred to the issue of China’s direct investment in Latin America, commenting, “China is entering the financing of infrastructure projects and is receiving special conditions to supply manufactured goods. Some agreements avoid bidding processes and eliminate competition. The fundamental problem is unfair competition.”