The disconnect: Goodbye to the back yard


Photo: Inter-American Dialogue/Flickr

6th July 2016

Interview with World Bank Chief Economist for Latin America Augusto de la Torre
By Elida Bustos
Changing, changing, everything’s changing. It’s not only wars that change maps and spheres of political influence; the flow of also trade does. In this case, what communism couldn’t do over decades – snatch Latin America from the United States to leave it in the back yard – China is achieving through trade.
There’s another fundamental change: the region has stopped moving in a single bloc; now there will be two.
Augusto de la Torre (pictured), the World Bank’s chief economist for Latin America and the Caribbean, is the person who anticipates this change of paradigm. “Starting in 2002 or 2003, economic activity in a growing number of Latin American countries started to move in tandem with China’s economic cycle and away from the North American cycle, he tells Latin Trade. “The region is dividing itself and the south, South America, is connecting with the China’s economy more strongly than with the United States.”
This change started to happen at the time when Beijing burst onto the global economic scene, and fundamentally with the incorporation of China into the WTO in 2001.
China’s industry quickly became a starving giant with a craving for copper, iron ore, raw materials in general, soybeans and much more. Other sectors of the same economy were added to this as they went out into the world in search of supplies and food.
Latin America answered the call and was ecstatic about …

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