Satellite

China/Latin America: China to launch first Bolivian satellite in December

China to launch first Bolivian satellite in December; Brazil imposes anti-dumping measures on Chinese tyres; First shipment of genetically modified corn transported from Argentina to China

 Satellite

China to launch first Bolivian satellite in December

Last Wednesday the director of the Agencia Boliviana Espacial (Bolivian Space Agency – ABE), Ivan Zambrana, confirmed that Chinese-funded satellite Tupac Katari will be launched into space 20 December 2013.

The assigned orbit for the satellite is 87.2degrees west on the Equator, where the Galapagos islands are located.

The satellite will reduce the cost of telecommunications in Bolivia and additionally other Latin American countries will have access to it.

Mr Zambrana emphasised the importance of the telecommunications industry to the national GDP, ‘Last year the turnover of telecommunications companies exceeded $1.5trn in a single year.’

The main earth station for the operation of the satellite is located in the city of El Alto in Bolivia’s Amachuma region.  Presently over 60 Bolivian nationals are being trained in China to operate the project (see previous blog here).

The construction of the satellite was agreed under a bilateral trade deal between the Bolivian government and Chinese company Great Wall in December 2010.  The China Development Bank provided the financing with a $251m credit agreement.  The total cost for the project will be $300m.

Brazil imposes anti-dumping measures on Chinese tyres

The Brazilian government will levy a five year anti-dumping tax on Chinese tyres, according to the Ministry of Commerce.  The duty will be calculated according to the weight of the tyres and will range from $1.08 to $2.17 per kg.

This decision arose from a year-long investigation into car tyre dumping in Brazil by China and other countries, such as Japan, Russia, South Africa, South Korea and Thailand.

Brazil has a history of protectionism against China in the automobile industry; in 2008 and 2009 the government imposed duties on Chinese-imported cars.

Moreover in September 2011 further measures were announced by Finance Minister Guido Mantega, notable among which was a 30 point increase in the tax on imported cars, in an attempt to prevent the domestic car industry being squeezed by cheaper manufacturing conditions in China.

In addition China has been subject to Brazilian restrictions elsewhere; in 2011 a five year import tariff was imposed on Chinese steel products to avoid flooding the Brazilian steel market.

Nevertheless bilateral trade for the first half of 2013 recorded a 9% increase, coming in at $40.5bn.  Both imports and exports also went up by 9%, with a $5.4bn trade deficit in Brazil’s favour.

First shipment of genetically modified corn transported from Argentina to China

China has approved its first major shipment of genetically modified Argentine corn, according to Argentina’s Agricultural Minister Norberto Yauhar.  The Chinese health authorities allowed a cargo of 60,000 tonnes of GMO corn into the country.

At present Argentina is the world’s third largest exporter of corn and soybean, as well as the largest supplier of by-products like soyoil and soymeal.  The country competes with dominant producer the U.S. for market share in the corn industry.

China is already a significant customer of Argentine soy and the fact it has opened its doors to the corn cargo signals a significant potential growth market for other food products.

Demand for corn-fed poultry and pork in China has soared as the burgeoning middle class can afford a high-protein diet.  A source from the Argentine grains industry explained, ‘The story is that China needs food, food, food.’

The details surrounding the cargo are slightly shrouded in mystery; it is believed that the cargo left Argentina in May and was approved recently by China’s General Administration of Quality Supervision, Inspection and Quarantine (AQSIQ).  However the source who reported this update asked not to be named, and both the AQSIQ and Argentine embassy in Beijing have remained silent on the subject.

The majority of Argentine corn is genetically modified.  A test sample was allowed into China last year under a China-Argentina GMO deal signed in February 2012.

There is a broad consensus amongst the global scientific community that food made from GMO products poses no greater health risk than regular food, though advocacy groups argue that the harmful effects of GMO food have not been properly identified.

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