Latin America and China: international trade and economic growth

Mónica Liseth Cardozo de Barrios, Edgar Mauricio Luna Domínguez, Jorge Omar Moreno Treviño

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Abstract

In 1990, the participation of China in the global imports of Latin America (LAC) was incipient, while by 2019, China had become the second largest supplier of the region. This paper uses a sample of 14 LAC countries, estimates the effects of imports from China on each LAC country's economic growth, and verifies if these effects are evidenced in these countries' non-exporting or exporting sectors. This study proposes a Seemingly-Unrelated-Regressions (SUR) system for each sector. Results show that before China entered into World Trade Organization (WTO), LAC imports from China positively affected the economic growth of some LAC countries. However, beneficiary countries increased after China´s adhesion to WTO. Imports from China drive the economic growth of the non-exporting sectors of Argentina, Costa Rica, Ecuador, and El Salvador, the exporting sector of the Dominican Republic, and both sectors of Brazil, Chile, Colombia, Peru, Uruguay, and Venezuela. Except for the Dominican Republic, the countries whose export sectors benefit from China's imports are primary exporting countries. Adverse or null effects are estimated for the rest of the countries.
Original languageEnglish
Article number99
Pages (from-to)23-52
JournalAnálisis Económico
Volume38
Issue number99
Publication statusPublished - 20 Sept 2023

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