At a time when China’s growing military and commercial influence is causing concern around the world, especially among US analysts, Uruguay is moving forward with a proposal for a free trade agreement with the world’s second-largest economy.
A working group set up at the end of September is preparing a feasibility study for the treaty, which Montevideo hopes will be defined by 2022.
“We made an agreement with the Chinese government to advance this joint feasibility study to conclude it by the end of the year and, eventually, start the second stage, which is the negotiation itself”, declared Foreign Minister Francisco Bustillo.
A report published in September by the Uruguayan newspaper El Observador highlighted that President Luis Lacalle Pou is in a hurry to reach an agreement with the Chinese due to issues related to Brazil.
As the Brazilian government has been maintaining an “acceptable reception” – in the words of Lacalle Pou – for a treaty between Uruguay and China, the commitment needs to move forward while Brazilians occupy the temporary presidency of Mercosur and before the presidential campaign begins, in which Jair Bolsonaro could be replaced by a president less sympathetic to Uruguayan intentions – Argentina is against the agreement, as it understands that it disrespects Mercosur regulations.
“Today, we have a certain position in Brazil. I don’t know if she will change. What I do know is that the one we have today serves Uruguay’s interests in the case of moving forward bilaterally with China. If it serves us now, we have to take advantage of it”, said Lacalle Pou.
China’s rising economic power in the Americas worries the United States, which in late September sent President Joe Biden’s deputy national security adviser, Daleep Singh, on visits to Colombia, Ecuador and Panama to discuss investments in infrastructure for neutralize Chinese influence in the region. At the same time, his signaling about the Beijing-Montevideo negotiations is still timid.
Last Tuesday (9), the American Undersecretary of State, Wendy Sherman, visited Lacalle Pou in Montevideo, and the focus of the conversation was “ways to deepen and expand trade relations” between the two countries.
However, the Uruguayan press highlighted that Sherman never mentioned the possibility of a free trade agreement with the United States, a long-standing aspiration of Uruguay.
Asked about Uruguay’s dealings with China, the undersecretary limited herself to saying that “all countries should explore all the options presented to them, as long as they do so on the basis of clean and transparent trade.”
USA left behind in its own hemisphere
In a recent article published on Barron’s financial and market information magazine’s website, Eric Farnsworth, head of the Council of the Americas in Washington and academic correspondent for the National Academy of Economics of Uruguay, and Carlos Mazal, member of the same academy and the Council on Relations Internationals from Uruguay, analyzed that the reaction of the Biden government to the negotiations between the Uruguayans and the Chinese will be decisive for the future of the Washington-Beijing dispute in Latin America.
“Washington now has a choice: it can lead, follow or get out of the way. How it responds to new developments with Uruguay will say a lot about the broader desire to fight for the Americas,” wrote Farnsworth and Mazal.
“If the United States declines the offer to deepen economic relations with a friendly, liberal, democratic, relatively prosperous and stable country, situated between the two largest economies in South America, others in Latin America will quickly draw their own conclusions,” they added. . “The United States is being left behind in its own hemisphere. And time is quickly running out.”
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