Chile close on China FTA
Reuters
Chile close on China FTA
By Paul Harris
Santiago
September 24, 2005
Chilean President Ricardo Lagos said his country could sign the first free trade agreement with China in November following the conclusion of the final round of talks in October.
The agreement will strengthen ties between the world’s largest copper producer and the worlds largest copper consumer, and is also expected to provide a big boost to Chile’s fruit exports.
"We want to be a bridge between Latin America and Asia, to position ourselves as a platform for Asia to reach Latin America," Mr Lagos said in an interview.
Copper accounts for about 73 per cent of Chile’s exports to China, worth $US2.7 billion ($A3.6 billion) in 2004 according to state copper commission Cochilco, and demand shows no sign of abating.
Cochilco predicts that China’s consumption needs will rise from 3.8 million tonnes per year to 11.1 million tonnes, to reach European levels of 9.5 kilograms per capita from 2.5kg per capita in 2004. Copper is a crucial element in our relation with China, Mr Lagos said.
This FTA is good news for copper producers with operations in Chile such as BHP Billiton, which owns the Cerro Colorado mine and a controlling stake in Escondida, one of the biggest copper mines in the world.
However, BHP Billiton competitor Codelco has already forged links with Chinese state mineral company Minmetals, which will advance $US2 billion for its future copper purchases to finance the state copper company’s $US17 billion expansion plan to produce up to 3 million tonnes per year of copper by 2020.
— Reuters
