To read this content please select one of the options below:

China’s trade policy towards Latin America: an analysis of free trade agreements policy

Dorotea Lopez (University of Chile, Santiago, Chile)
Felipe Munoz (University of Chile, Santiago, Chile) (FDDI Visiting Scholar, Fudan University, Shanghai, China) (UNU MERIT, Maastricht University, Maastricht, Netherlands)

Asian Education and Development Studies

ISSN: 2046-3162

Article publication date: 3 June 2020

Issue publication date: 18 June 2021

185

Abstract

Purpose

The emergence of China in the international trading system has shifted its gravity center, as the country has become one of the mayor actors in international economic relations. Through the subscription of preferential agreements, China is building a network of strategic partnerships worldwide, including Latin America. The purpose of this paper is to answer the questions: Do free trade agreements (FTAs) between China and Latin American countries contribute to expand trade flows and enhance products diversification?

Design/methodology/approach

Three countries have an FTA with China, Chile (2005), Peru (2009) and Costa Rica (2010). Through an econometric estimation based on a gravity model, the authors expect to determine the impact of these agreements over both trade flows and products.

Findings

The study shows that FTAs have a positive impact on both bilateral trade flows and on the number of exchanged products. Nevertheless, this impact is positive but diminishes in time. The authors confirm that these agreements allowed for a substantive expansion of trade between Latin American economies and China, becoming relevant for policymakers regarding the bi-regional relation.

Originality/value

The study contributes to the understanding of the bilateral trade relations between China and Latin American countries, giving evidence of the magnitude of the impact of FTAs. Through new data, at a six-digit level of detail, this study improves current knowledge regarding bilateral economic relations.

Keywords

Acknowledgements

Funding: FDDI–Fudan University FDDI Visiting Scholar Fellowship and Fondo Nacional de Desarrollo Científico y Tecnológico No. 11170126.

Citation

Lopez, D. and Munoz, F. (2021), "China’s trade policy towards Latin America: an analysis of free trade agreements policy", Asian Education and Development Studies, Vol. 10 No. 3, pp. 399-409. https://doi.org/10.1108/AEDS-08-2019-0133

Publisher

:

Emerald Publishing Limited

Copyright © 2020, Emerald Publishing Limited

Related articles