{"id":50027724,"date":"2019-06-07T13:57:58","date_gmt":"2019-06-07T12:57:58","guid":{"rendered":"https:\/\/stage.dialogochino.net\/?p=27724"},"modified":"2023-03-12T17:34:53","modified_gmt":"2023-03-12T17:34:53","slug":"27724-trade-war-threatens-instability-and-deforestation-in-latin-america","status":"publish","type":"post","link":"https:\/\/dialogue.earth\/en\/business\/27724-trade-war-threatens-instability-and-deforestation-in-latin-america\/","title":{"rendered":"Trade war threatens instability and deforestation in Latin America"},"content":{"rendered":"

The latest round of tariff hikes in the ongoing US-China trade war could have far-reaching impacts not only for big soy exporters Brazil and Argentina but throughout Latin America. The region\u2019s initial opportunism is giving way to fears over instability and slower global growth. \u00a0<\/span><\/p>\n

On June 1 <\/span>China suspended purchasing<\/span><\/a> US soy in an escalation of the trade spat. The world\u2019s largest buyer will look largely to Brazil to meet demand in a shift that could impact South American forests as the risk of protracted tensions bites. \u00a0<\/span><\/p>\n

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5.8%<\/p>\n

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\nMexico's estimated growth in exports since the trade war began
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After a year of tit-for-tat tariffs, the impacts on Latin American countries are starting to sink in. A <\/span>report<\/span><\/a> from the United National Conference on Trade and Development (UNCTAD) estimated a growth in exports for several countries in the region, including Mexico (5.8%), Brazil, (3.8%) and Argentina (2.4%).<\/span><\/p>\n

Yet, as some hope to capitalise, others foresee doomsday. Few are willing to predict how long the trade spat will last, or its effects linger.<\/span><\/p>\n

\u201cIt generates insecurity, in general. That\u2019s the thing,\u201d said Lucilio Alves, from the Center of Advanced Studies in Applied Economics (Cepea), at the University of S\u00e3o Paulo. \u201cThis makes new investments harder.\u201d<\/span><\/p>\n

Deforestation risk<\/h2>\n

Last March, a group of scientists warned that the US-China trade war could cause a devastating spike in deforestation in Brazil, as the country tried to absorb Chinese soy demand.<\/span><\/p>\n

\u201cWe forecast that a surge of tropical deforestation could occur as a result of the fresh demand being placed on China\u2019s other major suppliers,\u201d they wrote in <\/span>an article<\/span><\/a> in <\/span>Nature<\/span><\/i>, predicting Brazil could be pushed to expand production in up to 13 million hectares. <\/span><\/p>\n

\u201cWe urge the US and China to adjust their trading arrangements immediately to avoid this catastrophe.\u201d<\/span><\/p>\n

A little over a month later, Brazil\u2019s National Confederation of Industries celebrated the extra US$8 billion <\/span>in revenues<\/span><\/a> that the trade war brought in 2018. \u201cA trade war isn\u2019t good or advised to any country in the medium to long term, but, in the short term, Brazil has benefited,\u201d the institution said in a press release.<\/span><\/p>\n

if there is an extremely lucrative crop, it could be that at first there is substitution, and, in a second phase, there is dislocation to new areas<\/span><\/p><\/blockquote>\n

Brazil expects the trade war to positively impact its beef and chicken exports, but of the US$8 billion in new exports, soy accounts for $7 billion.<\/span><\/p>\n

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