Overall cooperation between China and Latin America and the Caribbean is an affirmatively chosen option in China's global strategy and China is also a priority in Latin America's Asia-Pacific diplomatic strategy, according to the Yellow Book of Latin America and Caribbean (2014-15) just released by the Chinese Academy of Social Science on May 15 in Beijing.

"The report highlights how strategic Latin America has become for China, and China has become for Latin America," said Kevin Gallagher, a professor of global development policy at Boston University. "They are building strong bridges across the Pacific Ocean."

The publication points out that the Chinese government, led by President Xi Jinping, has put great emphasis on establishing a "community of shared destiny" with developing countries, becoming and remaining "trustworthy friends and sincere partners", adding that Latin America consists mainly of developing countries.

With the rise of China's comprehensive national power and global influence, as well as close trade ties between China and Latin America, it has, according to the report, become a consensus among Latin American countries to develop strategic relations with China.

The establishment of the Pacific Alliance in 2011 shows the willingness of some Latin American countries to actively develop relations with Asia-Pacific partners to aid domestic economic growth, and China has become a priority partner of choice among Latin American and Caribbean nations, said the book.

In 2013, China surpassed the United States as the leading source of South American exports outside of Latin America itself. In January, at the Community of Latin American and Caribbean States-China summit, the two sides pledged to increase trade by $500 billion and investment by $250 billion.

"This couldn't come at a better time for Latin America," said Gallagher. "As commodity prices have slid downward and China's demand has dipped due to the rebalancing of the Chinese economy, growth in Latin America has slowed significantly. China offers a new source of trade and finance for Latin America."

With the transition of development and economic growth patterns, China and Chinese companies have further favored the Latin American region where there are rich resources and a huge market, said the yellow book.

In addition, further cooperation in bilateral trade and investment is expected as a way to boost international competitiveness of China and Latin America and the Caribbean, as well as increasing their active participation in the restructuring of the global industrial supply chain.

The central challenge for Latin American countries is that "they have to invest the proceeds of new trade and investment with China into areas that can diversify their economies and create gainful employment for a burgeoning middle class," added Gallagher. "The region will need to better manage the environmental implications of commodity-led growth, or the very source of their competitive advantage could dwindle."

Despite the fact that the relationship between China and Latin America is expected to deepen in the next five years, new challenges could emerge as the relationship has entered a new phase, according to Ariel Armony of the University of Pittsburgh.

"On the Latin American side, the countries in the region have not been able to articulate a coordinated policy toward China and their own engagement with China is not based on a long-term plan," said Armony. On the Chinese side, Armony said there is a gap between the expanded Chinese presence 'on the ground' (companies, investment, Chinese nationals in Latin America) and the level of engagement in the region.

In order to fine tune its engagement with Latin America and the Caribbean, China needs to boost its knowledge about Latin America and there are excellent opportunities to take this relationship to the next level, Armorny said.

xiaolixin@chinadaily.com.cn