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Business / Economy

Leaders push for trade agreement with Colombia

By Cheng Guangjin and Li Jiabao (China Daily) Updated: 2012-05-11 11:24

During their meeting with visiting Colombian President Juan Manuel Santos, Premier Wen Jiabao and Vice-Premier Li Keqiang called for an early start to negotiations on a bilateral free trade agreement.

Wen also said China encourages its companies to participate in infrastructure construction and resource development in the Latin American nation.

Santos is on a five-day visit to China that started on Tuesday.

China and Colombia share broad common interests, Li said, urging the two sides to implement the consensus reached between the leaders of the two nations.

Nine deals were signed on Wednesday after talks between Santos and President Hu Jintao, including partnerships in the fields of energy, mining and agriculture as well as a plan to jointly study the feasibility of a bilateral free trade agreement.

Colombia is rich in natural resources, and has an important geopolitical location in Latin America, Li said.

Li called for the two countries to deepen economic ties as well as enlarge and balance bilateral trade. He said it is necessary to carefully study the feasibility of a free trade agreement, which can promote cooperation between companies from each country.

China's energy cooperation with Latin America began as early as 1993, but it has only just begun working with Colombia, where security concerns had been an obstacle in the past, analysts said.

"Colombia has made huge security strides since Santos became president," said Qi Fengtian, an expert on Colombian studies with the Chinese Academy of Social Sciences.

"The country is safer than people generally think, and the investment environment has improved a lot since security is much better now," Qi said.

In 2011, Sino-Colombian trade reached $8.2 billion, a 39 percent increase over the previous year, making China Colombia's second-largest trading partner after the United States.

"I see great prospects for both countries to cooperate on agribusiness because of China's strong demand for grains and Colombia's potential to increase agricultural production," Santos said at the Colombia-China Trade and Investment Forum on Thursday morning.

Colombian Agriculture Minister Juan Carlos Restrepo added that the small amount of foreign investment in agriculture - less than 1 percent of the country's FDI in 2011 - means there are great business opportunities for Chinese investors.

Restrepo added that the widening of the Panama Canal will mean growth in agricultural trade, especially meat, with China.

Colombia's infrastructure development also requires large amounts of foreign investment, and China has rich experience in funding overseas infrastructure projects, Santos said.

"Underdeveloped infrastructure is now the bottleneck of Colombian economic growth. We have great demand for highways, railways, canals and airports, and China means opportunity to Colombia. We are planning to build the railway network to transport coal and mineral resources for export," said German Cardona Gutierrez, minister of transport of Colombia.

Wang Yongsheng, vice-president of China Development Bank, said the bank will provide loans for Chinese companies investing in Colombia's energy, mining and infrastructure sectors.

Wang Chenyan contributed to this story.

Contact the writers at chengguangjin@chinadaily.com.cn and lijiabao@chinadaily.com.cn

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