Heine Analyzes China’s Economic Slowdown

Latin America Advisor recently featured insights from Jorge Heine, Research Professor at Boston University’s Frederick S. Pardee School of Global Studies and Interim Director of the Frederick S. Pardee Center for the Study of the Longer-Range Future, shedding light on the implications of China’s economic slowdown for Latin America. Responding to the question on the impact of China’s downturn, Heine stated,

“With exceptions, like Guyana and Venezuela, projections for the region’s economic growth in 2024 are not encouraging.”

According to Heine, the United Nations Economic Commission for Latin America and the Caribbean forecasts a decline in economic growth from 2.2 percent in 2023 to 1.9 percent in 2024. South America, being heavily reliant on trade with China, faces a more significant hit, with growth projected to drop from 1.5 percent in 2023 to 1.4 percent in 2024. China-LAC trade, which reached $480 billion in 2022, showed signs of a downturn, reaching $400 billion by September 2023.

Despite these challenges, Heine highlights that China remains committed to enhancing ties with the region, as evidenced by recent free trade agreements with Ecuador, Nicaragua, and multiple agreements with Brazil. He suggests that Latin America’s best chance to navigate this economic challenge lies in accelerating its energy transition, leveraging its clean electricity grid and abundant copper and lithium reserves. Heine emphasizes,

“The fact that China has a commanding position in the electric vehicle market…shows the huge extant complementarities in this regard.”

In the face of China’s economic slowdown, Heine’s analysis underscores the importance of strategic shifts and collaboration for Latin American countries to weather the storm and find opportunities for growth and can be accessed here.

Ambassador Jorge Heine is a Research Professor at the Pardee School of Global Studies at Boston University. He has served as ambassador of Chile to China (2014-2017), to India (2003-2007), and to South Africa (1994-1999), and as a Cabinet Minister in the Chilean Government. Read more about Ambassador Heine on his Pardee School faculty profile.