Thanks to China for Record Foreign Direct Investment in Latin America

Thanks to China for Record Foreign Direct Investment in Latin America

Montevideo : Uruguay | Mar 16, 2012 at 11:52 AM PDT
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TechCamp Montevideo: Getting teachers in Latin America to use technology effectively (Espanol)

Confirmed by the ECLAC during the 53 th Assembly of the IDB in Montevideo (photo). The region received in 2011 about 138 billion dollars , in part by the Asian giant pulse.

The report was anticipated by the executive secretary of the Economic Commission for Latin America and the Caribbean, Alicia Barcena, at the beginning of a forum on economic development models in the context of the 53rd Assembly of the Inter-American Development Bank that began on Thursday Montevideo.

According to ECLAC's previous report on Foreign Direct Investment (FDI) in 2010, the year the United States was the largest investor in Latin America, with 17%, followed by Holland (13%), China (9%), and Canada and Spain (both 4%). Overall, FDI inflows in 2010 reached 112.634 million dollars, with Brazil and Mexico to the head.

In the workshop held in Montevideo, organized by the Latin American Integration Association (ALADI), Barcena said the good time living in the region, with average levels of poverty of 31 percent and extreme poverty from 17 percent, thanks to the attitude "more progressive" governments "in the social field.”

However, note that some economies are slowing, giving an average growth of 3.7 percent this year, rejected an excess of "over-optimism" regional, especially about the possible effects of the crisis in developed countries. “The most important thing is what is happening in the Eurozone, but it is not unique, “because this phenomenon "impacts us because there is stagnation in global demand and increased uncertainty in financial markets."

The central concern is the slowdown in China, whose growth will slow from 9.5% to 7.5%, he said. This phenomenon can affect commodity-exporting countries such as South America, those that are growing in the region over Mexico and Central America.

"Exports of goods increased in 2011 by 23 percent, but the most important is price rather than volume," he lamented. Among the instruments available to Latin America to face a possible contagion are its international reserves, which "are located in unprecedented levels of 765 billion dollars today, "he said.

The region "is the second holder of Treasury Bonds (U.S.) in the world after China" and "public finances are under control," he said. Regarding "factors that conspire" against the region outlined "inflation (for the high price of raw materials), the appreciation (by capital flows freely), the danger of deteriorating current account and the volatility financial markets.”

In this context, Latin America must have a “strategic view "to Asia and India, because there are "about 800 million people are entering the middle class." "Growth (regional) will depend more on China, but South-South trade could overtake North-North in 2017," he predicted.

Forum Aladi involved, among others, the finance ministers of Argentina, Chile, Paraguay, Uruguay, Bolivia and Peru, the Ibero-American Secretary General, Enrique Iglesias and Secretary General of the Organization of American States (OAS) , José Miguel Insulza .

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Stock markets across Latin America tumbled on Monday
Stock markets across Latin America tumbled on Monday
Vicky247 is based in Lahore, Punjab, Pakistan, and is a Reporter on Allvoices.
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