SANTIAGO – Global economic recovery is going through a “tortuous” process and the best recipe for speeding its growth is free trade, Chinese Prime Minister Li Keqiang said Tuesday in the Chilean capital.
“Free trade is the best way to grow the economy,” he said at a meeting of the Chile-China Bilateral Business Council.
Li’s presence in Santiago commemorating the two countries’ 45 years of diplomatic relations is one stop on a tour of Latin America that also took him to Colombia, Peru and Brazil.
Developing countries promote industrialization and urbanization, while developed nations aim for reindustrialization, Li said.
“We can take cooperation on infrastructure as a starting point for collaborating on manufacturing, industrial equipment and investment in order to drive the economy,” he said.
He noted that the “best medicine” for global economic recovery is free trade, financial cooperation and industrializing the developing countries.
China and Latin America are at just the right time for such cooperation, since the Asian giant is capable of producing inexpensive, high-quality equipment and technology, while Latin America needs to expand its capacity for building infrastructures.
With regard to Chile, Li said his country is willing to negotiate an expansion of the existing trade treaty, signed a decade ago.
“We’re willing to import an increasing amount of competitive products and agricultural goods from Chile,” he said. “There’s still plenty of room to diversify exports and drive your country’s industrialization.”
Chilean President Michelle Bachelet, who also took part in the meeting, announced that negotiations to modernize the trade pact will begin “before August.”
The president emphasized the importance of the 10 cooperation agreements signed with China on Monday, the first day of Li’s visit.
Bachelet particularly stressed an agreement between the respective central banks to make it easier to use China’s currency, the yuan, in transactions between the two countries.
Bachelet said that China’s support is important for Chile in order to achieve the physical integration of South America by means of corridors between the Atlantic and Pacific, “because in that way we can firmly establish Chile as a port and a bridge to Asia (for all South America), from Brazil to the coasts of Chile,” she said.
“As you can see, our bilateral relations have a wide horizon that is favorable for both parties,” Bachelet said.