[This is the first of what I hope will be many posts on Latin America by my friend and frequent collaborator Dorothy Kronick. Dorothy’s reporting from Caracas, Venezuela, where she was a Fulbright Scholar, was published in The New Republic, The American Prospect, and the Chilean business magazine AméricaEconomía. She now lives in Buenos Aires, Argentina. –Graham]
Monday marked the one-year birthday of China’s free trade agreement (FTA) with Chile, the first such agreement between China and a Latin American nation. Both Chile and China had reason to celebrate the occasion: bilateral trade has increased nearly 100 percent since the agreement went into effect, driven largely by the sale of Chilean copper to conductor-hungry China. For the first time, China surpassed the United States as the principal customer for Chilean goods, purchasing $5 billion, or 15 percent, of Chile’s exports (in 2000, Chile sent just 5 percent of its exports to China).
The China-Chile FTA is just one of Chile’s new ties to Asia. On September 3, Michele Bachelet and Abe Shinzo signed an FTA that will eliminate the vast majority of tariffs between Chile and Japan. Trade between Chile and South Korea has increased 232 percent since the implementation of a bilateral FTA three years ago. Chile, Brunei, New Zealand, and Singapore increased their trade flows with the “Trans-Pacific Strategic Economic Partnership Agreement” last year. Later this month, Chile and China will discuss deepening their trade relationship by opening services markets. And there are more deals to be had. Latin America’s strongest and most dynamic economy has a lot to offer its Pacific Rim trade partners, and vice-versa.