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Stub Article Submission (17 May 2021)
China-Uruguay relations, also referred to as Chinese-Uruguayan relations, were first established in 1988. Relations were defined as “friendly and cooperative” by the Chinese government. The bilateral relation was promoted to a strategic partnership in 2016.

History (Pre-2008)

Diplomatic relations (1988-2000)

China and Uruguay established diplomatic relations in 1988. Relations were classified as “friendly and cooperative”. Trade increased steadily throughout the 1990s, particularly due to China’s growing demand for raw materials. Imports from China increased from 1.1% in 1990 to 4.1% in 2000. Exports to China as a proportion of total exports increased from 4.8% to 5% in the same period.

Rapid economic growth of China (2000-2006)

During 2000-2006, trade flows between China and Uruguay significantly increased due to China’s rapid economic growth. For Uruguay, imports from China increased by 213% in this period, with the proportion of imports from China to total imports increasing from 3.2% in 2000 to 7.4% in 2006. China rose to become Uruguay’s fourth largest import supplier in 2006. The increase in imports has negatively impacted Uruguay’s domestic producers, who have struggled to compete with foreign firms.

Exports from Uruguay to China increased by 5.5% between 2001-2005. The proportion of exports to China to total exports increased by 0.5%. This increase in exports is attributed to China’s high demand for natural resources. As such, a large proportion of Uruguay’s exports to China consist of primary commodities.

Uruguay’s export products to China have moved towards less-developed products as Chinese industries have pushed the production of higher-value added products. Wool has been Uruguay’s top export product to China, with two main variants: wool tops (a higher value-added product) and non-carded wool (a lower value-added product). In 2002, the total exported value of wool tops was US$48.4m. Non-carded wool was the top 6th exported product, with a significantly less total value of US$4.9m. In 2006, non-carded wool exports increased by 6 times the 2002 value, reaching a total of $30.1m. On the other hand, wool top exports experienced a 35% decrease, amounting to a total of $31.4m.

Uruguay had a trade deficit with China during 2000-2006, importing more than exporting. Its trade deficit with China made up a quarter of its total deficits. This increased Uruguay’s reliance on commodities, which posed a challenge for the economy’s development.

Financial direct investment (FDI) also increased during this period. In late 2008, Chery Mobile, a Chinese company, began manufacturing cars in Uruguay through a joint venture with Socma in Argentina and Oferol in Uruguay.

Global Financial Crisis (2008-2009)

Bilateral trade decreased due to the Global Financial Crisis, but returned to pre-crisis levels by 2010.

Post 2008 Relations

Diplomatic relations

In June 2012, former Chinese Prime Minister Wen Jiabao visited several Latin American countries, including Uruguay, expressing interest in establishing an economic forum between China and CELAC (Community of Latin American and Caribbean States). Wen Jiabao’s proposals during this visit encouraged the expansion of trade relations between China and Latin American countries.

In May 2013, former Uruguayan President Jose Mujica met with Chinese President Xi Jinping in Beijing, China. The talks furthered relations, with the two nations establishing a five-year plan concerning bilateral trade. In addition to this, a bilateral agreement was also signed by the national representatives. Xi said the two countries should further joint projects in automobile manufacture, communication, and agriculture, and that he would urge China-Uruguayan cooperation in the development of Uruguayan infrastructure. Xi stated the importance of China-Uruguayan relations in encouraging other developing nations to pursue economic partnerships with China. Mujica stated that Uruguay would contribute to the development of China-Latin America relations.

In 2016, China and Uruguay established a strategic partnership and the two countries signed a free trade agreement. This was a step-up from the initial relationship established in 1988. Uruguay has supported the “One China Policy” and does not have an office in Taiwan.

In April 2019, China’s deputy Prime Minister Hu Chunhua visited Uruguay. Uruguayan Foreign Minister Rodolfo Nin Novoa said that the visit strengthened China-Uruguay relations. He also stated his expectations for future trade and tariff agreements between the two countries, particularly emphasizing the importance of agreements that concerned food safety, as a large portion of Uruguay’s exports consists of food products.

Economic relations

Trade

Trade has been expanding since 2008 due to an increase in both China and Uruguay’s exports. Exports to China increased from US$171m in 2008 to US$2500m in 2017. Exports remained largely made up of primary commodities, namely soybeans, wool, and meat products. Imports from China increased from US$833m to US$1704m in the same period, consisting mainly of manufactured products. Since 2012, Uruguay has had a trade surplus with China.

Financial Flows and Investment

Financial flow and investment between the two regions are minimal. Uruguay does not currently have a currency swap agreement with China, unlike other nations in the same geographic region. Most financial flows between the two countries consist of China’s foreign direct investment. These investments are largely made up of China’s use of Uruguay as a tax haven, but precise data from official reports has not been publicized.

Migration

According to a 2015 census conducted by the Ministry of Commerce of the People’s Republic of China, there were 300 Chinese citizens living in Uruguay. Uruguay’s tight immigration laws have prevented high levels of migration.

Answer to Module 7 Questions
This is my own work, with file format .jpg. I have chosen a Creative Commons license. I will be putting it under the category: "Food" and "Desserts". I will describe it as "chocolate cookies with powdered sugar on top".

Practicing Citations
China's rapid economic growth has impacted Uruguay's economy.

The nature of China-Uruguay relations have changed over the years due to the different political stances both countries have adopted over time.

China-Uruguay trade relations have contributed to the economic development of both countries.

Danilo Astori’s (then Vice President of Uruguay) visited the capital of China in late August of 2010.

Rodolfo Nin Novoa, Uruguay’s Foreign Minister, has expressed the importance of strengthening China-Uruguay relations in the food industry.