Recent China-LAC trade relations: Implications for inequality?

Abstract

In the last decade, the socioeconomic relationship between Latin America and the Caribbean (LAC) and the People´s Republic of China has increased massively. How has this new qualitative relationship between LAC and China affected inequality in LAC? This paper highlights the degrees of concentration of trade since the 1990s until 2011 and its technological content. Future research will have to deepen this relationship at the national, regional and even firm-level. Based on a brief critical review of the relationship between trade and equality/inequality, the document analyzes several of the outstanding features of the booming trade relationship between LAC and China. It concludes, among other issues, that both academics and policy makers have to overcome the bias against the agricultural sector and natural resources based on the concepts of global commodity chains, systemic competitiveness and territorial endogeneity. In addition, one of the most striking features of the new LAC-China trade is its increasing concentration, both compared with historical levels of LAC-China trade, as well as with the rest of the world, a development that will affect inequality in LAC substantially. It is not “old wine in new bottles”, but rather a new socioeconomic relationship with dynamic and profound impacts in LAC that will have to be considered in more detail by scholars and policy makers in the future.