Last week, delegates from the China Youth Center for International Exchange visited our office during their exploratory trip to Chile and Argentina to learn more about the region and promote youth interchange. During the visit, the president of the organization, Ma Xingmin, signed a Memorandum of Understanding with our partner Francisco Saenz in which both parties agreed to provide support to entrepreneurs from China and Latin America looking to expand into each other’s markets.
This agreement serves to deepen ties between Magma and China after we co-launched the Sino-Latin American Accelerator with Kr Space in January 2018 to help connect entrepreneurs and investors in both regions. As part of the agreement, China Youth Center for International Exchange will support the accelerator program and Magma Partners will continue to host events on Latin America in China to teach Chinese investors and entrepreneurs about doing business in Latin America.
Jie Hao, a Beijing-based Partner at Magma Partners noted, “We believe that China will play an important part in Latin America, both at the governmental level and in the high tech ecosystem. I’m excited to continue to support the exchange between China and the region.”
This trip was the China Youth Center for International Exchange’s first visit to Latin America. The Center is part of the All China Youth Federation, the biggest youth organization in China with more than 300 million members. During their visit, the delegates also met with government organizations, banks, businesses, and entrepreneurs.
“I believe it is important to open up communications and cooperation between Chinese and Chilean young entrepreneurs,” said Ma Xingmin during the signing ceremony.
The visit is a sign of China’s increasing interest in the Latin American market. Chile recently joined China’s Belt and Road Initiative and deepened trade relationships with the Asian giant. Francisco Saenz commented on the trend saying, “I am excited about the chance to learn more about China. I went to China in January 2018 and saw that China is ahead of Latin America in many ways, but especially in high tech. There is a lot that we can learn from China.”
China’s growing influence in Latin America is one of the trends we have been watching this year, and we are looking forward to working with the China Youth Center for International Exchange to promote interchange between the two regions.
The relationship between Latin America and China intensified over the past three months. Tencent invested US$180M in Nubank, Ant Financial invested millions in Stone Co’s IPO, and Beijing agreed to swap over US$18B in yuan for Argentine pesos.
China’s relationship with Chile has grown, as well, as the Magma Partners China office has spoken at monthly events about investment in Latin America. During the past three months, Magma China co-hosted a seminar during a visit from Roberto Ampuero, Chile’s Minister of Foreign Affairs and presented at two significant events to increase people’s awareness of Latin America as an investment destination.
Here’s how Magma has promoted Sino-Latin American investment in three events over the past three months.
Roberto Ampuero, Minister of Foreign Affairs of Chile, visited China after being invited by China’s Minister of Foreign Affairs, Yi Wang. During his three day trip, Mr. Ampuero presented during a seminar entitled “Chile, the Latin-American Center of Entrepreneurship and Venture Capital” at Kr Space’s Zhongguancun Community at Beijing. Magma Partners collaborated with ProChile and Kr Space to co-host the event and generate more awareness of Chile in China. The event also included a presentation from Chris Martin, Vice President of Mobike’s International Expansion Department, who explained why Mobike is interested in LatAm and why they picked Santiago as Mobike’s first Latin American destination. Mobike has just landed at Chile this year and is planning to expand to other countries in the region over the next couple of years.
Chile’s stable economy and business-friendly government make it an interesting destination for Chinese investors. As Ampuero stated at the event, “Chinese enterprises are welcome to come to Latin America. Chile can offer varied talents. We encourage people to invest in Chile, to start a business here, and to talk to our younger generations to get to know the country better. Thus we build a bridge between Chile and China.”
On Oct.30, The China-Latin America and Caribbean Investment Exchange (CLACIE), hosted their annual conference in Beijing, China, sponsored by IDB. This invite-only event gathered 125 people who are involved in the China-LatAm investment relationship who would discuss Chinese-Latin American cooperation across several industries..
Jie Hao, Magma’s Chinese partner, presented at the tech forum as a panel speaker and shared his insights on the emerging LatAm tech ecosystem as a Chinese investor. “Early-stage startups from Latin America are unlikely to find funding in China, even if they visit many times, if all they do is do roadshows, so far Chinese funds have invested into companies in their B, or C round, with early stage being out of scope”
Two days later, on November 1st, the 4th Chile Week officially kicked off in Beijing. InvestChile organizes this event once yearly to promote understanding of Chile in China. The event unites big names from Chile to present before a Chinese audience; Former President Eduardo Frei Ruiz-Tagle spoke alongside Chilean Ambassador to China, Luis Schmidt, Chinese Ambassador to Chile, Bu Xu, and Minister of Foreign Affairs, Roberto Ampuero. Jie once again spoke on a panel about the tech and financial connections between China and Chile.
During Chile Week, Chile officially signed and joined the Belt & Road initiative, China’s development strategy meant to boost multilateral connections, trade, and investments. According to InvestChile, this strategic connection positions Chile as the main hub for Chinese companies operating in LatAm and offers financial backup services to companies of both countries that assists with creating stronger tech innovation.
Recently, the ties between China and LatAm have been growing stronger. Unlike in the past, not just the construction industry is receiving backing from the Chinese government. China’s private investors and companies have begun backing Latin American startups. China’s startups see Latin America as a potential market for their fintech solutions. The two regions grow closer with each coming month.
Our partner, Jie Hao believes there is a significant opportunity for Latin American entrepreneurs to visit China to learn about the Chinese startup ecosystem and see if they can apply the Chinese innovation experience to Latin America. “Chinese startups are already far advanced and under extreme competition. Latin America entrepreneurs will learn the best business models, the best technology, how their peers can survive in China, how to raise funds etc.”
Early this year, Magma Partners partnered with 36Kr and launched the first ever Sino-LatAm accelerator worldwide. So far we have hosted a series of events at embassies of latam countries in Beijing and Kr Spaces as part of our efforts to promote awareness of LatAm in China. We are watching China’s growing interest in Latin America and believe that China will have a strong influence in the region’s startup ecosystem over the next few years..
In January we launched the Sin0-Latin America Accelerator with Kr Space, one of the largest coworking spaces in China. We created initiative with Kr Space to help Latin Americans understand how they can leverage the Chinese market and for Chinese entrepreneurs and investors to better understand how they can do business in Latin America.
Since then, we’ve created monthly events with Kr Space to highlight individual countries and opportunities available to entrepreneurs and investors in each country. We’ve held events at Kr Space in Shanghai and Beijing, and at Latin American Embassies in Beijing. Here’s an overview of the Kr-Magma Space events in China so far this year.