China in Latin America

June 18, 2009

By Antonio Castillo

The lack of democracy is also a point of anxiety. After the brutal military dictatorships of the 1970s and ’80s, Latin American countries genuinely appreciate democracy, and there is a sense of uneasiness dealing with a one-party-rule country. And then there is the Taiwan case, a country that through its infamous ‘chequebook diplomacy’ has been able to lure the allegiance of several Latin American countries, including Costa Rica, Paraguay, Grenada and Dominica. China won’t rest until all Latin American countries adopt the one-China policy.

The Chinese leap forward into Latin America has occurred in the context of the lowest point of US-Latin American relations since the end of the Cold War. While it is true that the US has tended to stop looking southwards since 9/11, Latin America is still in Washington’s zone of influence. This is a powerful reason for China to be cautious in its move to the region. As Gonzalo Paz says, ‘China doesn’t want to change the strategic paradigm in the region and doesn’t want to be seen as a threat to the US.’

This is especially important in the all-sensitive security and military front. According to Professor Paz, ‘The evidence of Chinese military presence in Latin America is not conclusive, and while there has been an increase in military connections, these are minimal when compared with Russia, for example.’ He also believes ‘intelligence sharing has been limited’.

And while Latin American countries have so far welcomed China’s growing influence in their region, they are less welcoming when it comes to a possible Chinese military presence. ‘Generally speaking, Latin American countries don’t want to replace China for the US in this area,’ Paz argues.
American foreign policy and military strategists express concerns

According to Dr José Luis León, Professor of International Relations at Mexico’s Universidad Autónoma Metropolitana, the US did not seem to be particularly concerned in the early stages of China’s involvement in Latin America.

‘However, in the last few years both American foreign policy and military strategists have expressed concerns about the Chinese presence in what the US sees as its historic sphere of influence,’ he says.

And perhaps the US should be concerned. Left-wing Ecuadorian president Rafael Correa campaigned on a promise to close the US naval base of Manta that has been operating since 1999. The lease will expire in 2009 and it has been reported that he has offered to lease Manta to China as a transit port from which to exploit the vast resources of the Amazon. Commentators speculate it will only be a matter of time before Manta becomes a Chinese intelligence surveillance base.

While the military and intelligence Sino-Latin American relationship is so far mainly speculative and perhaps limited at its best, the economic relationship is a solid fact and keeps on growing. For Latin America countries this is crucial. As Professor Paz told The Diplomat, ‘China is the new engine of Latin American economic growth.’
FACT FILE
China has established diplomatic relations with 21 of the 33 Latin American countries. In 2004, Brazil, Argentina, Chile, Peru and Venezuela announced recognition of China’s full market economy status. In 2007, Brazil was China’s largest Latin American trading partner, with bilateral trade reaching US$29.7 billion, followed by Mexico with US$14.9 billion, Chile with US$14.6 billion, Argentina with US$9.9 billion and Peru with US$6 billion. Bilateral trade with Cuba totalled US$2.3 billion. China has displaced Japan as the main trading partner for Latin America. China’s main export commodities to Latin America include fabric and textile products, shoes, machinery, televisions and plastic products. Chinese activities in Latin America centre on natural resource extraction, principally soy products (Argentina and Brazil), copper (Chile), iron and fishmeal (Peru), crude oil (Venezuela) and nickel (Cuba). Twelve of the 25 countries worldwide that recognise Taiwan are in Latin America (down from 14 in 2004, as Grenada and Dominica subsequently switched). The 12 are all seven Central American countries (Belize, Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and Panama); four Caribbean nations (the Dominican Republic, Haiti, St Kitts and Nevis, and St Vincent and the Grenadines); and one South American country (Paraguay).