How does the technological war between the United States and China affect Latin America?

The technological tension between the United States and China has a substantial impact on Latin America, since the dispute over 5G affects the development of a region with insufficient technological penetration and innovation, according to Alicia Bárcena, executive secretary of the Economic Commission for Latin America and the Caribbean. Caribbean (ECLAC).

"There is indeed a commercial part, but the technological part is fundamental," said the United Nations official, referring to the intensification of the battle between the two largest economic powers in the world and their replicas in Latin America.

In an interview with Efe, Bárcena said that China has advanced more in the technological part than the rest of the world and that in the USA. It is still the country that concentrates the main industries of the sector, such as Apple or Facebook.

Latin America is divided among those whose main trading partner is the United States (Mexico and Central America) and the countries that have China (those of South America).

China has gone very quickly in 5G, in electromobility, in renewable energy. What does that mean for Latin America? Much. The main trading partner of South America is China and the second is the USA.

She specifically cited the dispute over 5G as one of the elements of the Washington-Beijing dispute that affects Latin America, a region in which the 4G format is not yet widely spread.

"5G is very important" because it can lead to "higher levels of the pulse of information technology," Bárcena said, citing telemedicine as an example.

To reduce the level of dependence on the United States and China, Alicia Bárcena, who is Mexican, defended greater productive and commercial integration among Latin American countries, especially in a scenario of lower external demand for raw materials.

"We (Latin America) are the ones that buy less among us". Of the total of Latin American exports, only 17% is intraregional, compared to 70% in Europe and 45% in the Pacific.

The development of internal value chains combined with the strengthening of intraregional trade would contribute to an increase in productivity, with more employment and inclusion of small and medium enterprises. The level of productivity in the region remained stagnant in recent years, which represents a trap for regional growth.

"We have not been able to move forward, our level of productivity is 20% in the United States and 40% in Europe, and we have stagnated there for two decades now, we lack innovation, and added value".

Other traps are a social vulnerability, with high inequality and 40% of households at risk of returning to poverty, institutional fragility, with high levels of perception of corruption and lack of transparency, and, finally, the lack of vocation for environmental sustainability

"We are a region very rich in biodiversity, but we do not take advantage of that wealth, rather we destroy it".