China's Caribbean connection
What will be the economic impact?
Bill Milligan
China has recently spent seven billion dollars on investments in the Caribbean and Latin America. The majority of the revenue has gone to countries that have developed diplomatic ties with China while severing them with Taiwan, according to Dr. Adam Wu, CEO of China Business Network, a featured speaker at the recent Caribbean Hotel and Tourism Conference in Jamaica. Wu revealed that 23 countries have relations with Taiwan, and 12 are in the Caribbean and Central America. Currently six Caribbean nations - Antigua and Barbuda, Guyana, Grenada, Jamaica, Suriname and Trinidad and Tobago- have formal relationships with China. Dominica has investments from China but without a "relationship."
Suspicious of the Chinese? Caribbean Hotel and Tourism Association president Josef Forstmayr says "I don't think one should ever look at any kind of investment with any other motive. It is what it is. It's an investment in the future of that country and it's a great validity signal that outside investors recognize the importance of that country. I don't see any kind of sinister elements there at all.”
China's foreign reserves, estimated at $3 to 6 trillion, is more than Saudi Arabia, Japan and Russia combined. Outbound Chinese tourists have dramatically increased since 1999, with 57 million traveling in 2010, a jump of 21 percent over 2009. Over 18 million business and employer foreign visits were recorded for 2010. It is unclear how many visits were to the Caribbean and Latin America.
The Chinese government is actively encouraging foreign travel and global business expansion. China has a middle class of more than 100 million people with disposable income. It is estimated that the Chinese spend an average of six thousand dollars per trip - the highest of any nation.
The Internet is the mode of communication for 457 million Chinese. Jamaica has courted Chinese tourism, and developed a website in Chinese that received more than two million "hits" following a visit from Jamaica's minister of tourism, Edmund Bartlett. China has already invested heavily in Jamaica's infrastructure, incuding the development of the new Montego Bay Convention Center and expansion of the island's port in Kingston.
China wants to gain a foothold in the Caribbean and Latin America for business ventures and tourism, but there is a price. Sever ties with Taiwan, develop diplomatic relations with China and the pocketbook magically opens. The future will see where this leads us from a geopolitical point of view.
Photo: Dr. Adam Wu, CEO of China Business Network, a featured speaker at the recent Caribbean Hotel and Tourism Conference in Jamaica. Photo courtesy Yndiana Montes and Bill Milligan.
Bill Milligan is the English editor for Solo Caribe.
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