China's president visits Trinidad in key trade region

PORT OF SPAIN (AFP) - When Chinese President Xi Jinping begins a tour of Latin America and the Caribbean on Friday, he will see a region split between nations with trade bonds with Beijing and those that recognise Taiwan.

Mr Xi will begin his trip in the oil-rich Caribbean island of Trinidad and Tobago before heading to Costa Rica and Mexico. The last two nations were visited by US President Barack Obama in early May.

China's trade ties with Latin America have soared in recent years as the world's second biggest economy taps into the region's mineral and oil wealth to fuel growth, but some nations are concerned about widening trade deficits.

His visit to Trinidad - the first by a Chinese president to the island off Venezuela - will come on the heels of a visit by US Vice President Joe Biden, who attended a summit with Caribbean leaders in Port of Spain this week.

"These are very special and historic times for Trinidad and Tobago," the island's communications minister Jamal Mohammed said of the two visits.

The government of Prime Minister Kamla Persad-Bissessar sees the Chinese leader's visit as an opportunity to deepen cooperation in trade, construction and heavy industries. The two sides will sign trade and education cooperation agreements, according to China's state Xinhua news agency.

At a news conference in Beijing, Chinese foreign ministry spokesman Hong Lei described Trinidad, a nation of 1.3 million people, as "China's important cooperative partner in the English-speaking Caribbean region." When asked whether visiting the same countries as US leaders was a coincidence or a reflection of US-Chinese competition in the region, Hong told reporters: "China enjoys sound bilateral relations with Latin American countries."

"We believe that China and the US can carry out cooperation in Latin America by giving play to their respective advantages so as to make joint contributions to the development of Latin American countries," the spokesman said.

Mr Xi will use the stop to meet representatives of several more nations, including Antigua and Barbuda, the Bahamas, Dominica, Grenada, Guyana, Suriname and Jamaica, Chinese assistant foreign minister Zhang Kunsheng said.

After touring Latin America, Mr Xi, who took office in March, will meet with Mr Obama between June 7-8 in California.

While Trinidad, Costa Rica and Mexico recognise Beijing, six Central American and five Caribbean nations have forged diplomatic relations with self-ruled Taiwan, which China considers part of its territory awaiting reunification, by force if necessary. The two split in 1949 after a civil war.

In a sign of China's growing presence, the Asian giant is overtaking the 27-nation European Union to become Latin America's second largest source of imports, according to the UN's Economic Commission for Latin America and the Caribbean (ECLAC).

Brazil and Mexico, Latin America's first and second biggest economies, respectively, are the top two markets for China in the region.

"It's a very dynamic relationship, with good and bad points, that poses deep questions for Latin America," Mr Hugo Beteta, the director of ECLAC regional office in Mexico, told AFP.

While China has become a key trade partner with the region, Latin American exports are too focused on raw materials and Chinese manufacturing imports have produced big trade deficits favoring Beijing, Beteta said.

Mexico, for example, imported US$57 billion (S$71.26 million)worth of Chinese imports last year while exporting just US$5.7 billion, according to the Mexican central bank.

The Mexican government says the balance is tilted by Chinese subsidies to the textile industry, and President Enrique Pena Nieto said he wanted to correct the deficit during his visit to China last month.

Mr Xi will hold talks with Pena Nieto, lawmakers and business leaders during his June 4-6 trip to Mexico, which includes a visit of the Mayan pyramids of Chichen Itza in the eastern state of Yucatan.

Before travelling to Mexico, Mr Xi will head to Costa Rica on Sunday, the only Central American nation to have switched allegiance from Taipei to Beijing, for talks with President Laura Chinchilla and to sign economic cooperation agreements.