China has become one of the most important investors in Latin America and the Caribbean accounting for almost 9 percent of the total investment flow to the region in 2010, the United Nations Economic Commission for Latin America and the Caribbean (ECLAC) said on Wednesday.

"In 2010 Chinese companies invested about 15 billion U.S. dollars in countries in Latin America and the Caribbean, basically through mergers and acquisitions," said the ECLAC in a new report published here Wednesday.

It said that more than 90 percent of Chinese investments in Latin America have been used toward the extraction of natural resources, especially in mining, but China is expected to start diversifying investments into a lot of new areas in the years to come.

"In the medium term it is expected that the transnational companies of that country (China) will continue to reach the region and that they diversify towards the infrastructure and manufacturing sectors," it added.

The ECLAC said that the flows of investment is reinforcing the production of specialized items in the region, but it did not provide any example of this.

It added that by 2011 the direct foreign investment in the region is expected to grow between 15 percent and 25 percent compared to 2010, but the region still has to apply policies that will focus on innovations that can help absorb improved benefits of this capital flow.

The main investor in the region is the United States with 17 percent of the total value, followed by the Netherlands with 13 percent, China with 9 percent and Canada and Spain each with 4 percent.