Exports from Latin American and Caribbean countries were up 17 percent year-on-year in the first half of 2005, largely due to greater demand from China, the UN Economic Commission for Latin America and the Caribbean (CEPAL) reported Tuesday.

According to the report, China has become the biggest market for South America with strong demand for its raw materials.

China's imports from the region surged from 1.5 billion US dollars in 1990 to 21.67 billion dollars in 2004. The annual growth rate stood at 42 percent from 2000 to 2004, higher than the 26 percent recorded for China's imports from elsewhere in the world, the report said.

If China keeps its high demand for raw materials, the South American countries can expect a long period of rising exports, estimated the CEPAL document.

CEPAL also commended China's investment in the region's infrastructure, energy and mining, saying the inflow of funds from China would boost the power to finance key projects in those areas.

The report also hailed the second consecutive year of trade expansion between the Latin American and Caribbean nations.

The Andean Community countries registered a 58.5-percent increase while the Common Market of the South saw a 36.2-percent rise, CEPAL reported.

Meanwhile, CEPAL warned there are mid-term risks including "a high current-account deficit in the United States ..., oil price hikes, the terrorist threat, and the protectionist trend in major industrialized economies."

Source: Xinhua