LATAM-ASIA TRADE EXPANDING AT AN ANNUAL RATEO F 20.5%, REACHING US$442 BILLION IN 2011

Washington, May 7- Trade between Asia and Latin America reached 442 billion dollars in 2011 growing at an annual rate of 20.5% in the last twelve years according to a joint report from the Inter American Development Bank and the Asian Development Bank.

Asia currently represents 21% of Latin America and the Caribbean international trade rapidly cutting distances with the 34% of the US.

“Defining the relation between Asia and Latin America and the Caribbean” as the report is called points out that the region’s share of Asia international trade during the last decade has doubled but remains below 4.4% Nevertheless trade has expanded sustainedly since 2000 propped by strong demand from Asia for minerals and food, abundant in Latin America and the Caribbean, as well as by the massive import of Asian manufactured goods, particularly in the south of the continent.

But in spite of the numbers’ success, the dynamics of bilateral trade has caused certain apprehension in Latam because of the risks of an excessive dependence of exports on commodities.

“But given the severe lack of resources in Asia as well as its continuous competitive edge, the report suggests that the dynamics of commodities for manufactured goods will continue for decades” argues economist Mauricio Moreira Mesquita, one of the authors behind the reports.

Nevertheless “there is room for a scenario where Latam and the Caribbean can add sophistication to their exports to Asia, with advantages in such areas such biotechnology, sustainable mining and clean energies”.

The report adds that since 2004, the two regions have implemented 18 free trade accords and an additional four have been signed and another eight are under discussions.

Finally inter-regional investments keep growing which helps countries explore new opportunities and tone down commercial tensions. Investments have kept parallel to the expansion of trade particularly in manufacturing.

And investments in that sector are focused mainly in China, Korea and Japan, on the one side and in Brazil, Argentina and Mexico on the other side. The investment inflow from Latam to Asia is described as minimal.

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