This attached report was originally prepared for the seminar “Japan-Latin
America Relations: Then and Now”, cohosted by the Inter-American Dialogue
and the Japan Association of Latin America and the Caribbean (JALAC),
September 16-17, 2015, Washington D.C., USA. The report shows that Japan
has been a major trading partner, investor, lender, and ODA donor in LAC
over the last five decades. Although bilateral merchandize trade between
Japan and LAC has been overshadowed by China’s ascendance in recent years,
Japan’s economic relationship with the region is much more diversified and
globalized than simple trade statistics might suggest.
Meanwhile, Japanese financial flows to the region continue to grow: the
stock of Japanese FDI to the region equals that of China, while the scale
of JBIC’s operations in the region rivals that of major multilateral
development institutions and Chinese policy banks. Japanese investment,
which has likely acted as a substitute for trade in some cases, brings a
number of benefits for LAC countries: cutting-edge technology, know-how,
employment and foreign exchange earnings, in a stark difference to the
Chinese case. The business scale of Japanese affiliates operating in the
region is gigantic: the sales (local markets, exports to third markets and
Japan) amounted to more than US$ 140 billion in 2013 alone. More than half
of this corresponds to exports to third country-markets. These companies
employed some 250 persons that year.
The report also points out special features and characteristics of trade
agreements signed by Japan, “Economic Partnership Agreements (EPAs), and
assesses the three EPAs with Chile, Mexico and Peru. It argues that the EPA
seeks to complement trade and investment liberalization with facilitation
and cooperation, and that in this respect, Japan’s ODA is an important part
of the cooperation provided under the EPA. The report also suggests several
policy options available to Japan in order to enhance further Japan-LAC
relations. Participating both in TPP and RCEP, and having signed a
bilateral EPA with each Pacific Alliance member country, Japan can act as a
“bridge” for non-APEC or non-TPP Latin American countries.
【JALAC Report】Click Here
