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Argentina in drive for more Chinese capital
Published on: 2011-07-25
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More Chinese investments are expected to flow to Argentina this year as the two governments signed several economic cooperation agreements this week, Luis Kreckler, Argentine secretary of trade and international economic relations, said on Wednesday.

The agreements cover sectors including agriculture, energy, transportation and mining, Kreckler told China Daily, without disclosing details.

The trade secretary headed a delegation of 50 high-level Argentine government officials in a visit to Beijing this week. The delegation included agriculture, mining, transportation and international trade officials.

This was the latest of many visits by state heads and delegations between the two countries since 2010.

"Chinese investments are becoming more and more important (to Argentina). We care about the partnership with China and are very optimistic about future cooperation," he said.

The economic relationship has expanded swiftly in recent years. In 2010, bilateral trade jumped by 65.6 percent year-on-year to $12.9 billion, data from the Chinese Ministry of Commerce showed.

As of last month, China had become the second-largest trading partner for Argentina, while Argentina was China's fourth-largest trading partner in Latin America, the ministry said.

The South American country has also benefited from China's emergence as a major global investor. The country attracted Chinese investments totaling $13 billion during the January-June period this year, Argentine official data showed.

Chinese investment has created more than 5,800 jobs in Argentina so far and will provide the Argentine people with 4,000 to 5,000 jobs in the next three years, said Wang Chao, Chinese vice-minister of commerce.

In the meantime, Chinese businesses are becoming increasingly active in Argentina. They are bidding to build nuclear power stations, natural gas plants and rail projects.

In some cases, they simply buy Argentine companies. Last May, China National Offshore Oil Corp Ltd bought 50 percent of Bridas Corp for $3.1 billion. Bridas is a major oil and natural gas holding company.

These moves have meant an unprecedented amount of Chinese investment into Argentina. Projects under discussion between the two governments are valued at $15 billion, Wang said.

"We are confident about better cooperation in the coming years," he added.

The agricultural industry in Argentina is particularly interested in attracting more Chinese investments, said Julian Dominguez, the agriculture minister.

"We are looking forward to deepening cooperation with China to establish a fairer and safer order for global food security," he said. "More Chinese investments are encouraged to flow to agriculture."

Trade in agricultural commodities is also likely to surge. China is expected to start imports of Argentine corn by 2012. The two governments are still holding discussions and have yet to work out a specific time frame, Dominguez said.

Agricultural products account for 85 percent of bilateral trade. China is by far the largest market for Argentine agricultural products. It imported more than 40 percent of Argentina's soy oil, which amounted to 4.6 million tons in 2009, more than twice the amount sold to India, the second-biggest customer.

Argentina has held several rounds of talks with China about imports of Argentine corn. In 2012, corn production in Argentina is expected to reach 30 million tons, compared with 22 million tons this year. About 8 million tons of corn are forecast to be consumed domestically, with the rest to be exported.

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