Latin America offers rewards but risks await
By the end of last year, China had injected a total of US$68.2 billion into Latin America, according to official figures. Last year, the foreign direct investment from China into Latin America reached US$6.17 billion, six times that of 2003.
Latin America has become a popular destination for Chinese investors in recent years, but some of them are urging caution as the nature of investment begins to change.
By the end of last year, China had injected a total of US$68.2 billion into the area, according to official figures. Last year, the foreign direct investment from China into Latin America reached US$6.17 billion, six times that of 2003.
"The form of investment from China in Latin America is changing," said Wang Jianjun, a senior official with the National Development and Reform Commission in China, at the 5th Latin America China Investors Forum held in Beijing yesterday.
He said Chinese companies were earlier engaged mainly in engineering, procurement and construction (EPC) projects in the region, but in recent years countries like Brazil and Peru have been offering two new forms of investment: build-operate-transfer and public-private partnerships.
"This may bring new business opportunities for us, but it also means higher risks," said Zhu Lin, a senior manager with Beijing-based China CAMC Engineering.
Zhao Zheng, a project manager at Complant International Engineering & Development Corp based in Beijing, said: "For the moment, what we are doing is still EPC projects. We will think carefully before trying new models."
Meanwhile, Detroit, which filed the largest municipal bankruptcy in US history in July, is looking to drum up interest among investors and tourists from China to revive its vehicle, agricultural and tourism sectors.
Michigan governor Rick Snyder is leading a delegation of Detroit officials and executives from 20 companies on a 10-day tour of Shanghai, Beijing and Chongqing to attract investment and boost tourism.
Chinese investment would be welcomed in Michigan's manufacturing, agricultural and health care sectors, Snyder said.
Zhou Dewen, chairman of the Wenzhou Small and Medium-Sized Enterprise Development Association, said Wenzhou businessmen would be interested.
