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INTERNATIONAL RELATIONS
OF THE CARIBBEAN
China emergence and its presence
in the Caribbean
Dr. Jacqueline LAGUARDIA MARTIN...
China economic figures (2000-2010)
2º Largest Economy (7º en 2000)
GDP growth (average): 9,7%
1º Exporter of Goods
1º ...
But in 2013…
• The expected growth of 8% that would allow
China to keep on being the main force behind
the world economy r...
Lower GDP growth rate (7,5%)
Minor dynamics but:
•Structural reforms: health and social
provisions, pension system, subsid...
Reasons to change
1. World economic crisis
2. The cost of production is increasing due to:
• the rising cost of production...
Similar to the BRICS
Future challenges: to set a new development
agenda, which must incorporate elements of
inclusive grow...
China is working on changing its
economic model to a
consumption-led one!!!!!!
How will that change impact on
the Caribbea...
China and the Caribbean
Traditional economic relations with China were
established from Chinese migrants who came to
work ...
The Caribbean’s interest in China
New type of relationship due to the
current geopolitical considerations
and changes in t...
Economy
• China could be the main driver of global growth
creating opportunities for a market for Caribbean
exports
• Trad...
International Politics
• China can act as a voice for Southern countries and an
intermediary between the Caribbean and dev...
What China wants
• To usurp Caribbean diplomatic support for Taiwan
(One China Policy)
• Broader foreign policy objectives...
• The Caribbean provides an attractive market for
Chinese products and investments
• CARICOM countries provide a ‘producti...
Caribbean–China Economic Relations
• Largely bilateral
• Multilateral effort in the biennial China
Caribbean Economic and ...
China comes with “advantages”:
They were never colonizers and is not
perceived to have been in an
exploitative relationshi...
Source: Annita Montoute, Caribbean-China Economic Relations: wha are the Implications?
Source: Annita Montoute, Caribbean-China Economic Relations: wha are the Implications?
Source: Annita Montoute, Caribbean-China Economic Relations: wha are the Implications?
Source: Annita Montoute, Caribbean-China Economic Relations: wha are the Implications?
Source: Annita Montoute, Caribbean-China Economic Relations: wha are the Implications?
Development projects
• September 2011, Jamaica: agreements totaling US
7.985 million (Montego Bay Convention Centre,
Palis...
• 2011, Guyana: RMB 30 million grant for the funding
several projects
• Dominica: Infrastructural development on four proj...
Interesting
• In October 2011, China sent a navy hospital ship,
the Peace Ark, to the region; in addition to docking
in Cu...
China’s investments
• Particularly strong with the “Big Six” CARICOM
member-states, with Jamaica having become
China's top...
The Caribbean may be able to use the opportunity to
take advantage of the competition among the
emerging and traditional p...
Other consequences to be considered
• Increasing trade deficit
• Cheaper Chinese imports may also be replacing
local produ...
China and the Caribbean
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China and the Caribbean

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The slide presentation is about China influence in the Caribbean economies, specially in the CARICOM countries and evaluate the China-Caribbean relationship

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China and the Caribbean

  1. 1. INTERNATIONAL RELATIONS OF THE CARIBBEAN China emergence and its presence in the Caribbean Dr. Jacqueline LAGUARDIA MARTINEZ
  2. 2. China economic figures (2000-2010) 2º Largest Economy (7º en 2000) GDP growth (average): 9,7% 1º Exporter of Goods 1º Importer of Goods 5º Exporter of Services 5º in FDI 1º World Savings (FOREX) 1º Market of Renewable Energies 1º Market of Iron and Steel 2º Scientific Publications The Chinese economy is now not only the second largest in the world, but it is larger than all the rest of the BRICS
  3. 3. But in 2013… • The expected growth of 8% that would allow China to keep on being the main force behind the world economy recovery did not happened (7,3% in 2013) • China was to supposed to advanced faster towards a new economic model that shift from investment and exports towards domestic consumption…
  4. 4. Lower GDP growth rate (7,5%) Minor dynamics but: •Structural reforms: health and social provisions, pension system, subsidies for housing, changes in the one child policy •Eradicate poverty •Diminish the gap urban-rural societies •Sustainable employment of natural resources •Environmental protection
  5. 5. Reasons to change 1. World economic crisis 2. The cost of production is increasing due to: • the rising cost of production inputs (energy and land) • Increasing skilled labor shortages • rising wage cost • lack of adequate infrastructure to link production bases to consumption bases 3. Environmental pollution 4. Overemployment of resources Political decision to change towards an economic model more consumption orientated
  6. 6. Similar to the BRICS Future challenges: to set a new development agenda, which must incorporate elements of inclusive growth, sustainable and equitable development, and perhaps most importantly, uplifting those at the bottom of the pyramid
  7. 7. China is working on changing its economic model to a consumption-led one!!!!!! How will that change impact on the Caribbean?
  8. 8. China and the Caribbean Traditional economic relations with China were established from Chinese migrants who came to work in the Caribbean after the abolition of African slavery
  9. 9. The Caribbean’s interest in China New type of relationship due to the current geopolitical considerations and changes in the global economy
  10. 10. Economy • China could be the main driver of global growth creating opportunities for a market for Caribbean exports • Trade that generates long term growth and development • Opportunity to diversify the Caribbean’s trade and economic relations • Important source of Development Aid • Foreign Direct Investment (FDI) • China is a Member of the Caribbean Development Bank and the Inter-American Development Bank
  11. 11. International Politics • China can act as a voice for Southern countries and an intermediary between the Caribbean and developed countries in multilateral fora • China has the potential of transforming the global economic order • China presents an alternative to USA and EU aid and development assistance. The Caribbean has decreased in importance to both the EU and the US (ACP is no longer considered to be a relevant framework to the EU) • Attracted by Chinese policy of neutrality, non interference and ease of access to Chinese loans
  12. 12. What China wants • To usurp Caribbean diplomatic support for Taiwan (One China Policy) • Broader foreign policy objectives in an increasingly globalized economy • Strategy towards acquiring big power status • Attaining food, raw materials, energy security for sustaining its economic growth (The Caribbean is the source of minerals: asphalt and gas in Trinidad and Tobago; bauxite in Jamaica and Guyana and timber and minerals in Guyana)
  13. 13. • The Caribbean provides an attractive market for Chinese products and investments • CARICOM countries provide a ‘production platform’ due to preferential arrangements provided by the Caribbean Basin Economic Recovery Act (CBERA), (Caribbean-Canada Trade Agreement) CARIBCAN and the CARIFORUM–EU EPA • Openings for Chinese investments and business opportunities for Chinese firms and employment of Chinese labor
  14. 14. Caribbean–China Economic Relations • Largely bilateral • Multilateral effort in the biennial China Caribbean Economic and Trade Cooperation fora: preferential loans for infrastructural development, training opportunities (natural disaster mitigation and prevention) and increasing and diversification of export • China is a member of the Caribbean Development Bank as well as the Inter-American Development Bank and has also contributed to the Caribbean Development Fund (CDF)
  15. 15. China comes with “advantages”: They were never colonizers and is not perceived to have been in an exploitative relationship with the Caribbean in the past
  16. 16. Source: Annita Montoute, Caribbean-China Economic Relations: wha are the Implications?
  17. 17. Source: Annita Montoute, Caribbean-China Economic Relations: wha are the Implications?
  18. 18. Source: Annita Montoute, Caribbean-China Economic Relations: wha are the Implications?
  19. 19. Source: Annita Montoute, Caribbean-China Economic Relations: wha are the Implications?
  20. 20. Source: Annita Montoute, Caribbean-China Economic Relations: wha are the Implications?
  21. 21. Development projects • September 2011, Jamaica: agreements totaling US 7.985 million (Montego Bay Convention Centre, Palisadoes Peninsula project) • 2011, Trinidad and Tobago: received 40 million Yuan in grant funding (National Academy of the Performing Arts) • 2011, Bahamas: Technical and Cooperation Agreement (total Chinese investment in the Bahamas to an estimated $2.66 billion) • 2011, Barbados: Grant of approximately BDS$6.15 million for various small scale development projects (Widley Gymnasium)
  22. 22. • 2011, Guyana: RMB 30 million grant for the funding several projects • Dominica: Infrastructural development on four projects totaling over $100 million • Antigua and Barbuda : a street lighting program, concessionary loans and grants for the Sir Vivian Richards Cricket Stadium, an airport terminal and a secondary school in Five Islands • Grenada: 86% of the cost of the rehabilitation of the St. Paul’s Sports, Cultural and Development Organization • Suriname: Foreign Ministry building; provided military assistance, construction of low-income housing, help with shrimp farming and an upgrade of the national television network
  23. 23. Interesting • In October 2011, China sent a navy hospital ship, the Peace Ark, to the region; in addition to docking in Cuba, the ship made stopovers in Jamaica, Trinidad and Tobago, and Costa Rica, in a 100-day mission called “Harmonious Mission 2011” • In Trinidad and Tobago, the Chinese government has developed a program to support martial arts initiatives, bringing performers from the Chung Shan Association to China for further training • Opening of Confucius Institutes
  24. 24. China’s investments • Particularly strong with the “Big Six” CARICOM member-states, with Jamaica having become China's top trading partner in the Caribbean in 2012 • China's EximBank is financing the construction of a 3,800-room resort in the Bahamas featuring the largest casino in the Caribbean • China has become an important source of tourists and CARICOM states have looked to develop new ways to tap this potential
  25. 25. The Caribbean may be able to use the opportunity to take advantage of the competition among the emerging and traditional players for their benefit •Renewed interest in the Caribbean (and Africa) by the EU •Joint Caribbean-EU Strategy (JCEUS) China’s policy of non-interference in the governance of countries and claims of no conditionality attached to development assistance makes it more appealing than traditional partners (but the use of Chinese labor, design, and technology associated with Chinese aid and investment)
  26. 26. Other consequences to be considered • Increasing trade deficit • Cheaper Chinese imports may also be replacing local products • the trade relationship is largely based on the importation of manufactured products from China and the exportation of raw materials from the Caribbean (replicating the previous scheme of trade with traditional partners?) • Work force unemployed • Investment in manufactured sector, not in services and does not promote technology transfer

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