US should prioritise Latam, Caribbean as trade partners -ECLAC
The Economic Commission for Latin America and the Caribbean (ECLAC) does not believe that the United States is doing enough to privilege this hemisphere as a strategic trade partner.
BRIDGETOWN, Barbados, Thursday September 8, 2011 - According to a report presented recently in Santiago, Chile, by the Economic Commission for Latin America and the Caribbean (ECLAC), while Latin America and the Caribbean has become the main destination for exports from the United States of America (receiving 23% of exports in 2010), the United States of America lacks an explicit trade policy towards Latin America and the Caribbean.
The report, entitled Latin America and the Caribbean in the World Economy 2010-2011, contrasted the US attitude to the region with the “dynamism” shown European and Asian partners in working out lasting negotiations in recent years with regional trading partners.
ECLAC suggested that a new alliance between the United States of America and the region be sought in order to tackle common challenges in the search for better integration in the world economy.
The organization also stated that there were interesting perspectives for cooperation between Europe and the region in areas such as green technology and social business responsibility.
In the study, the organization revealed that the value of imports would increase by 23%, with the region accumulating a trade surplus of slightly more than 80 billion dollars by the end of 2011.
ECLAC also stressed that international trade had significantly contributed to economic recovery following the economic and financial crisis of 2008 and 2009. However, it also warned that at present, the complex situation in developed countries, in particular the United States of America and in Europe, was starting to affect emerging nations and could decrease the rate of growth of exports to these markets in 2012.
"The levels of global volatility and uncertainty are worrying. There are still significant global imbalances, such as the sovereign debt crisis in various European countries and the fiscal uncertainty in the United States of America, which would in turn weaken international trade," stated Alicia Bárcena, Executive Secretary of ECLAC, while presenting the report.
The UN agency called for a revaluation of regional and global alliance strategies to take advantage of South-South trade and investment opportunities, and the creation of a joint approach with Asia-Pacific, in particular China.
ECLAC stated that South-South exchange, headed by China and the rest of emerging Asia, was currently the main driving force of global trade growth, since the volume of exports from developing countries grew by 17% in 2010, compared with 13% in industrialized countries.
Over the last five years, exports from the region to Asia-Pacific grew at an annual rate which tripled that of total exports (22% versus 7%). During the same period, imports from Asia-Pacific have also grown more quickly than total imports (annual rates of 15% versus 9%, respectively). Likewise, Latin America has become China's most dynamic trading partner, with an annual growth of 31% in its exports to the region between 2005 and 2010, compared with 16% to the rest of the world. Exports to Asia are still concentrated in primary products and their basic processing, while those directed to Latin America and the Caribbean, and the United States of America are mainly manufactured based products.
With regard to trade balance, South America maintains balanced trade with China and the rest of Asia, a slight surplus with Europe and a small deficit with the United States of America, while Mexico and Central America have a significant surplus with the United States of America, a deficit with the European Union and bulging deficit with China and the rest of Asia-Pacific.