China and Costa Rica were to launch free trade talks yesterday in a historic visit by Chinese President Hu Jintao (胡錦濤) at the start of a Latin America tour including Cuba and Peru.
China has increased diplomacy and investment in the region in recent years, with an eye on natural resources and developing markets for manufactured goods and even arms.
The Costa Rican capital was partially closed for the highest-level visit by a Chinese official to the country, just over a year after it gave up six decades of ties with Taiwan.
Hu, who arrived with scores of businessmen and Communist Party officials on Sunday, was due to announce the start of talks for a joint, free trade accord with Costa Rican President Oscar Arias yesterday morning.
They were also due to sign 11 cooperation deals, from building a joint oil refinery to setting up a Chinese language institute.
Costa Rica has dismissed fears of an invasion of Chinese products into the country under the free trade deal, which could be signed in 2010, diplomats said.
The trade balance has favored Costa Rica up until now, with US$803 million of exports up to September this year, compared with US$671 million of Chinese imports. China, however, deals in a much more diverse range of products.
Costa Rica would be the third Latin American country to negotiate a free trade deal with China, after Chile and Peru, which has not yet concluded its accord.
Costa Rica broke off more than 60 years of relations with Taiwan when it became the first Central American country to begin diplomatic ties with China on June 1, last year.