In October 2016, Vézquez and Chinese President Xi Jinping signed their countries for a strategic partnership agreement. Since then, much progress has been made at the bilateral level. In China-Latin America relations, Xi stressed that China is a strong supporter of Latin America`s stability, unity and development. China is ready to cooperate with Latin American countries to forge a common community of the future. (The other side of this argument was expressed by Argentina and Brazil when they said that China was the biggest exception to their pro-trade rhetoric. Both governments are under pressure in their own countries for a free trade agreement between China and Uruguay to strengthen their production sectors, particularly as Chinese imports could outdo their local products. Brazil, for example, wants to negotiate a trade agreement that facilitates the export of the higher-value goods it produces, such as aircraft, but is reluctant to allow more Chinese imports within its borders. In a meeting with Wang Yi, Uruguayan President Tabare Vazquez said he highly hoped to put pressure on a free trade agreement with China and was ready to actively participate in the Belt and Road initiative. It is clear that a review of the feasibility of such an agreement, as well as the definition of the rules of origin and related product tariffs, must be carried out. Nevertheless, there is sufficient substance between Mercosur, China and their existing agreements to give credibility to the potential of such an alliance. Uruguay has signed agreements with Spain, Sweden, Portugal, Mexico, Malta, Liechtenstein, India, Korea, Finland, Ecuador, Germany, Hungary and Argentina. These agreements include provisions that eliminate double taxation between parties with respect to income and wealth taxes and ensure non-discrimination in taxation.
These are quantifiable points, although partly dependent on the political landscape. Brazil, for example, currently has good relations with the United States and may not be prepared to upset Washington by developing trade relations with Beijing. Other issues relate to trade issues, such as China, which accepts tariff reductions that will become clearer over time. Since 1991, Uruguay, along with Argentina, Brazil and Paraguay, has been part of Mercosur. Venezuela became a full member in 2012. The regional opening process ended with the implementation of international agreements on goods, services, public procurement, investment and double taxation. In order to further deepen these economic relations and attract more Chinese investment, a Uruguayan government delegation visited China over the past two weeks and participated in various trade discussions, with the signing of some agreements and agreements on technology and innovation. China appreciates Uruguay`s support for the Belt and Road initiative and hopes that both sides will strengthen the integration of development strategies to improve economic and trade relations, Xi Xi said. ”Uruguay has put the issue on the table, because we are not progressing with the agenda that China wants in Latin America, these are free trade agreements,” said Ignacio Bartesaghi, dean of the Faculty of Economics at the Catholic University of Uruguay. China is Uruguay`s largest trading partner and buys 27 per cent of Uruguay`s exports.
Uruguay wishes to deepen these relations by strengthening cooperation in several other areas in addition to trade, while providing attractive conditions for Chinese investors, particularly in the infrastructure sector. The free trade agreements would pave the way for Uruguay and other Latin American countries to enter the Chinese market, which welcomes China and in the long-term interests of all parties involved, Wang said. Uruguay`s emphasis on trade in services has led to the signing of agreements with commitments in this area.