Selling soybeans, iron and copper ore and other commodities to Asian countries has transformed Latin America over the past decade, stabilizing economies despite worldwide crises and lifting tens of millions of people into the middle class. Now, say officials from both Asia and Latin America, a second gold rush is under way. Asian investors flush with hundreds of billions of dollars in cash now see Latin America as a top business opportunity, and they're flooding into manufacturing, construction and other industries, particularly in up-and-coming countries such as Brazil, Peru and Mexico. That's transforming the lucrative relationship that was based primarily on exporting raw materials to Asia, an arrangement that frustrated governments eager to stimulate their own manufacturing. Government and business officials meeting this week at the World Economic Forum in Mexico said the investment surge means Asia is poised to overtake the United States and the European Union as Latin America's top trading partner over the next decade. Asian representatives have been an unmistakable presence at the forum, with South Korean, Chinese and Japanese investors making the rounds at this seaside city's gleaming white convention hall. “We're talking about tens of billions of dollars in just Korean banks looking for a destination,” said Kevin Lu, Asia Pacific regional director of a World Bank Group agency that insures foreign investments against political risk. “When I meet with investors, Latin America is in every conversation about this.” Already, Chinese investment in Latin America has jumped from a few million dollars just a few years ago to about $15 billion in 2010, with most of the money going into mining and other extractive industries in Brazil, Peru and other nations, said Alicia Barcena, executive secretary for the Chile-based UN Economic Commission for Latin America and the Caribbean. Chinese investment in the region jumped again last year, to about $23 billion, Barcena said.
