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Chinese Foreign Direct Investments In Latin America And Their Influence On Chinese-Brazilian Economic Relations

Author

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  • Marta Czarnecka-Gallas

    () (Warsaw School of Economics)

Abstract

For many decades Chinese foreign direct investments in Latin America were not a subject of academic research or political debate. However, thanks to China’s fast economic growth, huge saving rate and national reserves, the country plays a more and more important role not only in global trade, being the world’s biggest exporter, but also in international investment scene by increasing the number and volume of its overseas businesses. Chinese FDIs in Latin America, although not as controversial as those in Africa, have registered a steady growth and seem to be both a chance and a threat for Latin American states. The scale and structure of FDI still remain relatively poor but the situation in the last years, especially 2009-2010 shows a significant change. Huge amount of Chinese FDI go to Brazil, which is also the recipient of the biggest Chinese single overseas business project (Porto do Aço). As far as Brazilian-Chinese bilateral economic relations are concerned, the complementarity of countries’ economies gives hope of beneficial cooperation, but at the same time poses a threat on Brazil of being vulnerable to externalities and losing manufacturing advantage in exports. Moreover, Chinese presence in Latin America means not only counterbalance to the influence of the USA but also undermines Brazilian position in the region. Methodology: The author combines quantitative and qualitative data analysis. Data used for the purpose of the article come mainly from UNCTAD statistics on-line, statistics of Chinese Ministry of Commerce, CIA Factbook. Moreover, the author makes use of desk research and literature review.

Suggested Citation

  • Marta Czarnecka-Gallas, 2012. "Chinese Foreign Direct Investments In Latin America And Their Influence On Chinese-Brazilian Economic Relations," Oeconomia Copernicana, Institute of Economic Research, vol. 3(1), pages 49-71, March.
  • Handle: RePEc:pes:ieroec:v:3:y:2012:i:1:p:49-71
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    File URL: http://dx.doi.org/10.12775/OeC.2012.003
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    References listed on IDEAS

    as
    1. Barbi, Fernando & Holland, Márcio, 2010. "China na América Latina: uma análise da perspectiva dos investimentos diretos estrangeiros," Coediciones, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), number 1402, December.
    2. Leamer, E.E., 1995. "The Heckscher-Ohlin Model in Theory and Practice," Princeton Studies in International Economics 77, International Economics Section, Departement of Economics Princeton University,.
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    Cited by:

    1. Czarnecka-Gallas Marta, 2015. "The Institutional and External Factors Behind the Switch of a Country’s Economic Growth Strategy. The Case of the Brazilian Economic Policy," International Journal of Management and Economics, Warsaw School of Economics, Collegium of World Economy, vol. 45(1), pages 57-82, March.

    More about this item

    Keywords

    Foreign Direct Investments; China; Latin America; international economic relations;

    JEL classification:

    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • F40 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - General
    • F50 - International Economics - - International Relations, National Security, and International Political Economy - - - General
    • O54 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Latin America; Caribbean

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