Latin America Showed Advantages In The US-Chinese String

CORPORATE FINANCE

From a Latin American perspective, the trade war between the US and China offered opportunities for the food and semi-finished goods sector. As business leaders in the region raised their short-term hopes to export soybeans, cotton, corn, meat, wine, and other products to Asian superpowers, they also focussed on tackling China’s resistance to value-added goods. They were also ready to take the remaining positions in the US market after Washington imposed higher tariffs on Chinese steel and aluminum.

At least until that time, Brazilian and Argentinian manufacturers have been exempted from customs. The more big dogs fight, the more opportunities open to countries in South and Central America. The trade between China and Latin America rose 18.8% to $ 260 billion in 2017 before a trade war broke out and the country’s investment in the region exceeded $ 200 billion.

Apparently, disputes between China and the US opened up opportunities for Latin American countries. Some South American export sectors were able to meet Chinese requirements. Brazil was already a major supplier of soybeans in China, and Argentina was a major supplier of poultry in China. Even Paraguay, which has no diplomatic relations with China, estimated that soybean exports will increase through indirect channels.

The Argentine Soybean Productive Chain Association (SPCA), believed that, the situation could force China to increase imports of soybean oil and bran from South America to overcome long-standing reluctance to buy value-added products from Argentina and Brazil.

However, South Americans remained cautious in calculating future benefits, because tensions between Washington and Beijing could be reduced by telephone calls.

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