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Investment flows highlight depth of Colombia ties

By Sergio Held in Bogota, Colombia | China Daily | Updated: 2020-03-19 10:02
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A driver poses with a fleet of Chinese-made electric buses in Cali, the third-largest city in Colombia, on Sept 10. JHON PAZ/XINHUA

China is boosting investments in Colombia as the countries mark 40 years of diplomatic relations, with a range of strategic projects helping to build trust and cooperation between Beijing and Bogota.

"We are living during a very important moment in the relationship between China and Colombia. China stands as the second-largest partner for Colombian exports, following the US," said Jaime Suarez, executive director of the Colombian-Chinese Chamber of Investment and Trade.

A "China-Colombia initiative" was hatched by the Colombian government during a state visit to China by President Ivan Duque in July.

"This initiative is focused on different fronts: attracting Chinese investment into Colombia, as well as tourism and boosting Colombian exports to China," said Suarez.

Flavia Santoro, president of investment promotion agency Pro-Colombia, said the initiative would pave the way for greater investments in infrastructure, renewable energy, technology and agriculture. As such, it would bring "more Colombian products into the Chinese market, and see more Chinese tourists discovering the unique culture and landscapes of Colombia", Santoro said.

Chinese companies are also betting on the prospects created by Colombia's free-trade zones.

"We want to see more Chinese companies producing in Colombia and taking advantage of the country as an export platform for the entire American continent," said Santoro.

'Very positive' outlook

Suarez said the outlook for Chinese foreign investment in Colombia is "very positive". "The number of projects being undertaken by Chinese companies in the country has surged exponentially," he said.

A$4 billion project for a skytrain service in Bogota was awarded in 2019 to a consortium including CHEC, Xi'an Rail Transit Group Company Limited and the Brazilian subsidiary of CRRC Changchun Railway Vehicles Co, Ltd. The project had been scheduled to start in February but was pushed back as a result of the COVID-19 pandemic. About 1,000 Chinese workers are expected to arrive in Colombia as soon as the outbreak is contained in both countries.

"We'll have to wait and see how the COVID-19 situation evolves around the world, so that all the people from China can come to start the construction of the skytrain," said Juvenal Infante, director of the Center for Asia-Pacific Studies at the Sergio Arboleda University, in Bogota.

"The Chinese will end up doing it and they will do it very well, honoring their commitments."

The closer ties between the countries are visible in many sectors.

"China is the second-largest Asian investor in Colombia after Japan. We have seen significant growth in Chinese investment," Santoro said. "From 2013 to 2018, China's foreign direct investment capital flows tripled."

In late February, Canadian and Chinese regulators approved the purchase of Canadian miner Continental Gold by Xiamen-based Zijin Mining Group in a deal worth more than $1 billion. Continental Gold operates a large gold mine in Buritica, north of Medellin, Colombia's second-largest city.

Chinese companies are also working on projects to benefit Colombia's environment and people's health, such as a water treatment plant to supply the Bogota region. Trina Solar is building a giant solar plant in Colombia's eastern savannas that will produce up to 27.2 megawatts. BYD Auto, the largest supplier of electric buses to the country, is changing much of its fleets from diesel to electric.

Suarez sees Chinese telecommunications companies Huawei and ZTE becoming increasingly more recognized in Colombia. "We are living in a new moment for Chinese companies in Colombia," Suarez said.

Yet another example is China Civil Engineering Construction Corp, which is building a light rail service connecting four towns around Bogota as part of a $543 million project.

The writer is a freelance journalist for China Daily.

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