Tags: Billion | Investment | Fund | China

IADB Launching $1 Billion Investment Fund With China

Monday, 19 March 2012 12:46 PM

The Inter-American Development Bank is starting a $1 billion fund with China aimed at investing in Latin America and the Caribbean, IADB President Luis Alberto Moreno said on Monday, another sign the Asian giant is expanding its influence in the region.

To feed its fast-growing economy's voracious appetite for resources, China has invested tens of billions of dollars in the region, from Mexico to Argentina, over the last decade to acquire strategic assets or companies in sectors such as oil, minerals and food products.

"This shows the enormous interest that China has in the Latin American region," Moreno told reporters at a press conference in Montevideo during the IADB annual meeting.

The deal with the IADB also shows China is strengthening its ties to prominent institutions in Latin America. China has been able to expand its leverage in what was traditionally seen as the backyard of the United States partly because Washington was distracted for much of the last decade with wars in Iraq and Afghanistan.

Moreno said the fund will have three different operators and the funds will have their own managers who will start looking at projects.

"The IADB and the Export-Import Bank of China have undertaken this initiative to develop an investment mechanism to meet the common interests of Latin American, the Caribbean and China," said Liu Lange, vice president of China Eximbank.

Latin America's leaders have looked to Beijing for trade and investment deals to offset slow economic growth in the United States and Europe.

China has free-trade pacts with Chile and Peru. But some countries have been wary about China's deep pockets. Brazil has tried to prevent foreigners from buying land in its valuable farming sector.

China has surpassed the United States as the main trade partner for many of the commodity-rich countries of Latin America.

But a slowdown in the Chinese economy is seen as a risk to commodity prices for many Latin American nations like Brazil, Chile and Peru.

© 2018 Thomson/Reuters. All rights reserved.

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Monday, 19 March 2012 12:46 PM
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