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Belt and Road Initiative offers chance to forge China-LatAm 'community'

Xinhua | Updated: 2017-06-17 17:27
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BEIJING — Around 440 years ago, two Chinese galleons sailed into the Mexican port of Acapulco, laden with prized goods from the Orient, including 23,730 meters of silk fabrics and 22,300 pieces of porcelain made in China, as well as ivory, lacquerware and Asian spices.

The two merchant ships carrying Chinese goods were also known as the Manila Galleons because they set sail from Manila, the current capital of the Philippines, and their arrival mirrored the very early days of the brisk trans-Pacific trade between Asia and Latin America.

After their cargo was unloaded, the galleons returned from Acapulco, carrying goods from the New World, such as silver, cacao, maize, potatoes and tomatoes.

This trade route was an extension of China's ancient Maritime Silk Route, and formed a key part of the glorious history of trade between China and the rest of the world.

Nowadays, China and Latin America are once again connected, this time by the 21st Century Maritime Silk Road, part of the Belt and Road Initiative proposed by China in 2013 with the aim of building a trade and infrastructure network connecting Asia with Europe and Africa along the ancient trade routes.

The new maritime route extends to Latin America and the Caribbean, a region looking for stronger infrastructure and greater inclusion in global value chains.

In the past decade, trade between China and Latin America has increased significantly, amounting to $216.5 billion in 2016.

There's little doubt that China and Latin America are natural trade partners. The region has abundant natural resources and has historically been a leading exporter of raw materials, while China, the world's second-largest economy, has a great demand for commodities.

According to the United Nations' Economic Commission for Latin America and the Caribbean, each one-percent increase in China's economy translates into a 0.5-percent increase in Latin America's gross domestic product (GDP).

China's agricultural imports from Latin America have grown and are poised to increase further, with the Chinese market's opening up to a variety of regional produce, a sign of Beijing's commitment to diversifying and balancing bilateral trade.

As the global economy is currently undergoing a rocky period of transition, China and Latin America are both tackling structural reforms to spur development, with shared goals and interests that go beyond mere trade.

In July 2014, Chinese President Xi Jinping traveled to the region for the second time, proposing a three-pronged growth strategy for both regions to promote trade, investment and financial cooperation.

By 2016, China's non-financial direct investment in Latin America grew to $29.8 billion, up 39 percent from the previous year.

Behind the stable development and pragmatic cooperation in trade and investment between the two sides is a belief in free trade that stands in sharp contrast with the recent rise in trade protectionism, as evidenced by Britain's exit from the European Union and the U.S. withdrawal from the Trans-Pacific Partnership.

The Belt and Road Initiative aims to coordinate public policy, connect infrastructure, eliminate trade barriers, integrate financial systems and strengthen ties between countries to spur development.

In essence, China proposes boosting transportation infrastructure, including roadways, rail lines, air links and ports, to increase trade.

Today, China and Latin America need to show the same courage and determination shown by the 16th-century explorers to overcome the currents of protectionism in parts of the world, and stay the course towards free trade and global development to benefit peoples around the world.

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