Stronger Ties With Chile

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Beijing
Review: Chinese Vice President Xi Jinping visited Chile in June. What impact has his visit had on the two countries’ economic and trade relationship?
Juan Andrés Fontaine Talavera: We were very happy to meet the vice president. He left a good impression on Chile. This visit was an important way of allowing the two countries to grow closer together.
Chile and China have a very strong trade relationship, largely due to the help of the free trade agreement we signed in 2006. China is currently Chile’s No.1 trading partner, and Chile is China’s No.2 trading partner in Latin America.
Now it’s time for us to go further and expand our cooperation to other fields, including investment, and scientific and technological exchanges.
During Xi’s visit, the two countries signed a series of cooperation agreements for agriculture, mining, banking, telecommunications and other areas. How do the two countries complement each other in these fields?
Chile exports a lot of copper and other raw materials to China. We think, with the increase of consumption, China is going to be increasingly interested in buying our food products. We have already started to export fresh fruit to China, including apples and grapes. We also export fish. And Chilean wine is becoming popular among Chinese
people because of its good quality.
These show we will move along the direction of expanding our exports to China.
We import consumer appliances from China, such as cars and machinery. China is producing goods with increasing scientific and technological sophistication. In the future, we will import more of these goods from China, especially from the IT and biotechnology industries.
In 2006, the China-Chile Free Trade Agreement (FTA) came into effect followed by the Supplementary Agreement on Trade in Services of the FTA in 2010. What benefits has the development of free trade brought to the two countries?
We are very happy with the way that the trade relationship between Chile and China has developed. Trade between the two countries has been strong and has grown quickly. And it has expanded to cover other goods and services.
We think now it is time to further strengthen investment in each other. Chinese companies can invest in Chile and Chilean companies can invest in China.
Which areas in your country are suitable for Chinese investment?
Chile aims to achieve a sustained 6-percent growth in GDP per year from now to the end of this decade. Chile will be the first Latin American country to achieve a per-capita income equivalent to that of a developed nation. In order to reach this goal, we need to increase investment. That’s why Chilean President Sebastian Pinera said he would inject $120 billion to boost the Chilean economy, and welcomes Chinese companies to invest in Chile.
There are many areas suitable for Chinese investment, not only in the development of mines, but also in providing Chilean mines with raw materials, machinery, technology and services.
We also have opportunities in agriculture, including wine and fruit. Chile is now the world’s top exporter of fresh fruit. We are able to provide good-quality food at low prices. We are starting to export pork and milk products to China.
Also, concerning economic development, we need to expand investment in energy, especially in electricity generation and transmission

capacity. We also welcome investment in infrastructure, such as ports and airports.
As a stable country with an open economy and foreign-friendly environment, Chile’s doors are open to Chinese investors. From Chile, they can reach out to our neighboring countries. Many Latin American countries are starting to grow, providing even more opportunities for China to expand and invest.
As you mentioned, many Latin American countries are starting to grow. China is also an emerging economy. What are your ideas on economic cooperation between China and Latin America?
Chile already has a strong relationship with China. China is Chile’s biggest trading partner. And 45 percent of Chile’s exports now go to Asia. Of them, 25 percent come to China and the other 20 percent to the rest of Asia.
Currently, much of the world’s economic growth comes from Asia. And Latin America is also starting to grow. The connection between the people of these two continents is going to get stronger.
The prospect for the cooperation between China and the Latin American region is very good. People from the two sides get to know each other. And their cooperation is growing very fast.
Trade is growing quickly between the two sides. The next step will be for Chinese companies to invest in Latin America, and Latin American companies to invest in China. Chile is growing and probably will become the first country to reach the level of a developed nation in Latin America.
My visit this time has two main purposes. One is to explore ways of expanding bilateral investment between Chile and China. We have been gathering information, talking to government officials and meeting companies to see how to go about that. The other is to look for ways to diversify our relationship through scientific and technological cooperation.
How many tourists travel between China and Chile each year? What cooperative programs in tourism have the two countries carried out?
The number of Chinese tourists traveling to Chile is quite small. There are only about 7,000 Chinese tourists each year. The two countries are too far away and flights are limited.
Chinese tourists can have a very fascinating experience in Chile. We have a good natural environment, abundant wildlife and different kinds of cuisines. And they can also go to Argentina and Brazil through Chile.
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China and Japan
The Diaoyu Islands in the East China Sea are China’s “inherent territory,” said Chinese Foreign Minister Yang Jiechi at a meeting with Japanese Foreign Minister Takeaki Matsumoto in Beijing on July 4.
The two sides should work together to implement their principled consensus on the East China Sea through practical activities, he said.
A day earlier, about 10 Japanese fish
ing boats left a port in Ishigaki, Okinawa Prefecture, to operate in waters near the Diaoyu Islands, known as the Senkaku Islands in Japan. The fishing boats left the waters after China’s protests.
“Any measure adopted by Japan in the waters off the Diaoyu Islands is illegal and invalid,” said Foreign Ministry spokesman Hong Lei.
Matsumoto paid his first visit to
China since taking office in March from July 3 to 4 at Yang’s invitation. During the visit, he also met Chinese Vice President Xi Jinping and State Councilor Dai Bingguo.
“The development of Sino-Japanese relations conforms to the basic interests of the two peoples,” Xi said.
As major trade and economic partners, China and Japan have become increasingly dependent on each other, he said.
Japan is China’s third largest trade partner after the EU and the United States. Official Chinese statistics show bilateral trade reached $297.8 billion in 2010, up 30.2 percent over the previous year. China’s imports from Japan and exports to Japan totaled $176.7 billion and$121.1 billion respectively.
While sharing broad common interests on international and regional issues, China and Japan bear important responsibilities in safeguarding and promoting peace and development in Asia and the world at large, Xi said.
Talking about Japan’s rebuilding efforts following the devastating March 11 earthquake and tsunami, Xi said, “I believe the Japanese people, through their unremitting efforts, can overcome difficulties, rebuild their homes and achieve new economic and social progress.”
Matsumoto said Japan hoped to enhance cooperation with China in various fields, including post-disaster reconstruction, to push forward the two countries’mutually beneficial strategic relations.
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