China – Latin America Economic Bulletin 2021 Edition

China – Latin America Economic Bulletin 2021 Edition

Rebecca Ray, Zara C. Albright y Kehan Wang

Latin America and the Caribbean (LAC) was hit hard in 2020 by the COVID-19 pandemic and the resulting economic downturn. With one of the highest mortality rates in the world, the region also saw the worst economic slowdown of any global region, contracting by over seven percent last year (“COVID-19 in Latin America” 2020; IMF 2021). In this context, LAC’s relationship with China—the most important export market for South America and second export market for LAC overall—is crucial.

These are among the findings of this year’s China-Latin America Economic Bulletin, the sixth annual note summarizing and synthesizing trends in the burgeoning China-Latin America economic relationship. The goal of the bulletin is to provide analysts and observers a handy reference to the everchanging landscape of China-Latin America economic relations, a landscape where data is not always as readily accessible. Highlights from this year’s edition include:

• For the first time in 15 years, China’s two policy banks, China Development Bank (CDB) and the Export-Import Bank of China (ExImBank) signed no new financing commitments with LAC governments. Instead, renegotiations of existing debts began, culminating in the suspension of $891 million in payments by Ecuador.

• China donated $215 million in medical aid to LAC countries. Nearly half of this amount—over $100 million—went to Venezuela.

• LAC-China trade held steady despite the regional downturn, at an estimated $136 billion in LAC-China exports and $160 billion in Chinese exports to LAC. Given the sharp economic slowdown, LAC’s trade with China rose to record levels as a share of regional GDP, at an estimated 3.8 percent of GDP in imports and 3.2 percent of GDP in exports.