The silk road “It is an agreement that many countries have concluded with China. It basically consists of the Chinese financing and investments for Chinese companies to develop infrastructure works in the countries to facilitate trade between those countries and China, such as ports, railways, logistics” explained Ambit Marcelo Elizondointernational analyst and president of the International Chamber of Commerce in Argentina.
“Actually it is Chinese investment to encourage trade between this country and Argentina”, says the specialist. And Elizondo adds that “From a strictly economic point of view, it can be good for a country like Argentina that has no investment, neither local nor foreign and that it will have a lot of difficulty getting investment from Western countries that see Argentina as an unreliable country”. `
However, he warned that “I see a risk if this agreement is intended to also make a geopolitical link. Most of the countries, Chile, for example, that joined the new Silk Road, have done so within a framework of making it clear that one thing is trade link projects, receiving investments and another thing are geopolitical references” , expands the specialist.
“I am concerned that this will end up being an opportunity for Argentina to also enter into a game of geopolitics and adhesion to China that, in the framework of the new tensions in the world, would be a mistake,” says Elizondo.
Asked about how long it would take for investments to arrive, he said that “You never know when they will be disbursed because the Chinese establish conditions, therefore, there is no deadline and the deadline will depend on whether the conditions that they are going to ask for are met. The Chinese don’t give away money.” Elizondo explains.
In this framework, it anticipates and indicates that “It will be necessary to see the fine print on what conditions the Chinese set to start disbursing investments in terms of the exchange rate, availability of business profits, which Chinese companies participate, participation of Chinese workers…”, concluded the head of the Chamber of Commerce in Argentina.
Record
An analysis by the Argentine Chamber of Commerce and Services (CAC) shows that, during 2021, the commercial exchange between Argentina and China was 19,685 million dollars, an improvement of 41.6% year-on-year.
In this way, after the drop recorded in the last three years, bilateral trade recovered significantly, reaching the historical record (more than almost 17,000 million dollars in 2015), highlighting the purchase by Argentina of automatic machines and vaccines, the latter to carry out the massive vaccination program against Covid-19.
In 2021, Argentina’s exports to China were 6.16 billion dollars, which marked an increase of 17% year-on-year. Among the main exported products were soybeans (31.6% of the total) and boneless beef (23.7%).
On the other hand, Argentine imports from China reached 13,525 million dollars, implying an expansion of 56% year-on-year. The main imported products were automatic machines for data processing, digital, portable, with 2.8% of the total purchases from that destination, and vaccines for human medicine, with 2.8%.
Main Argentine exports to China
- soy beans
- Beef, boneless, frozen
- grain sorghum
- crude soybean oil
- grain barley
- Pieces and offal of roosters or hens, frozen
- Shrimp, prawns and other decapods
- malting barley
- Deveined or deveined tobacco, in dry leaves in a Virginia-type hot-air dryer
Main Argentine imports from China
- Automatic machines for data processing, digital, portable
- Vaccines for human medicine
- Parts for receiving apparatus for radiotelephony, radiotelegraphy, radio broadcasting, television, video monitors and video projectors
- Glyphosate and its monoisopropylamine salt
- Printed circuits with electrical or electronic components
- Automatic machine units for data processing
- Monoammonium phosphate
Source: Ambito
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