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        The Chile-China Paradox: Burgeoning Trade, Little Investment

        ( Jorge Heine ) 경남대학교 극동문제연구소 2016 ASIAN PERSPECTIVE Vol.40 No.4

        Chile, a country that has been at the forefront of Latin America`s growing links with China, embodies a paradox in terms of Chinese outward foreign direct investment (COFDI). On the one hand, bilateral trade has thrived, increasing fourfold since the signing of a free trade agreement in 2005, turning Chile into China`s third largest trading partner in the region. On the other hand, Chinese direct investment in Chile has been low, much lower than in neighboring countries. In this article I explore the roots of this upsurge in bilateral trade while also explaining the reasons for the dearth of Chinese investment in a country traditionally considered to be attractive to foreign investors. Chile might be a victim of its own success as its economic accomplishments allow it to persist with investment policies that are currently daunting to Chinese investors.

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