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China’s Growing Power Over Latin America

Far inside Argentina’s remote Patagonian Desert, a massive radio antenna with a 100-foot diameter dish reaches to the sky from the dusty landscape.

The giant antenna is part of a 400-acre deep-space ground station operated by China’s military, which has assured its host country that the facility is strictly for peaceful civilian purposes. Its aim is space exploration, Beijing has said, not spying, as some have suggested.

But Alfredo Garrido, who owns a kiosk in Las Lajas, the nearest town about 40 miles away, isn’t so sure. No outsiders are allowed inside the station, Garrido told us. And the Chinese workers employed there hardly ever mingle with the locals.

“We don’t get any benefits from it,” said Garrido, 55, a member of the town council. “They do not consume in the local market, they do not relate to the community, and they do not generate jobs. It is, in my opinion, for military purposes.”

Surrounded by an 8-foot barbed wire fence, the Espacio Lejano station is just one of hundreds of projects developed in Latin America by the Chinese government and businesses over the last two decades.

As the U.S. government has turned its eyes away from the region to other global matters, Beijing has been laser-focused, stepping in to fill the vacuum not only with major infrastructure projects through its global Belt and Road Initiative and other plans, but also in robust trade, loan and public relations programs.

“For many years we have taken Latin America for granted,” said Ryan Berg, director of the Americas program at the Center for Strategic and International Studies.

The numbers tell the story of China’s ever-enlarging footprint in the Western Hemisphere. Since 2000, Latin America’s bilateral trade with Beijing has seen tremendous growth, reaching $180 billion in 2010, according to the Council on Foreign Relations. Today trade totals about $450 billion and could eclipse $700 billion by 2035.

China has been especially interested in Venezuela, Argentina, Brazil, Ecuador, Chile and Peru, whose lush geographies are rich in oil, soy, lithium and other commodities China needs and wants to sustain its people. To that end, China is now South America’s top trading partner.

Loans in the region have also exploded. In Latin America and the Caribbean. China’s state-owned banks issued loans of $137 billion between 2005 and 2022, according to the council, with Venezuela being the biggest borrower. Loans in 2022 alone totaled $813 million.

Military, diplomatic and policy experts have varying opinions of the threat this growing Chinese influence poses for the U.S. But one thing seems certain: The U.S. can no longer ignore China’s clear strategy, and it must act with a sense of urgency.

We’ve seen what effect destabilization in the region has had on not only its residents but also the entire continent. Communist China’s growing influence is more likely to weaken struggling democracies and prop up authoritarian regimes. Our series The Unraveling of Latin America has shown this trend to be at the very root of the region’s crime, poverty and other instability that drives its residents north to the U.S. border.

China’s interest grows

Chinese people have lived and worked in Latin America for hundreds of years. But Beijing began implementing a focused strategy to become a major economic player after it joined the World Trade Organization in 2001. Since then, China has turned to Latin America as an answer to many of its problems, especially concerns over food and energy supplies.

Chinese President Xi Jinping has personally invested himself in the region, visiting it nearly a dozen times in the last decade. Xi and his aides have secured hundreds of agreements and contracts with various countries. They’ve struck free trade agreements with Chile, Costa Rica, Ecuador, Peru and are close to signing one with Uruguay as well. And to date 22 Latin American and Caribbean countries, including seven in South America, have signed up with the Belt and Road Initiative, eager for new roads, ports and other infrastructure projects to bolster their economies.

Unfortunately for democracy, Venezuela is among the South American nations most happy to do business with China, and its relationship with Beijing is of particular concern to U.S. policy analysts and government officials.

China’s partnership with Venezuela thrived under the regime of former president Hugo Chávez and has continued to do so under Nicolás Maduro. China has loaned the country $62 billion since 2007. This year the two countries struck an “all-weather strategic partnership.”

This cozy arrangement hasn’t been just about infrastructure, goods and loans, however. China has also supplied Venezuela with extensive military equipment. It provided the armored vehicles Maduro used to quell democratic protesters in May 2019, according to Evan Ellis, research professor of Latin American studies at the U.S. Army War College Strategic Studies Institute.

It’s a good example, Ellis said, of how China’s actions in Venezuela and other countries such as Ecuador under former President Rafael Correa or Bolivia under Evo Morales have served as an “incubator of authoritarian populism.”

Juan Cruz, former senior director at the National Security Council, agreed. China’s support “has given some of the regimes a new lease on life as they’ve moved to consolidate control over their own people,” he told a panel discussion in March hosted by the Mosbacher Institute of the Bush School of Government & Public Service at Texas A&M University.

Throughout the region, China has also furthered its political agenda by persuading countries to break diplomatic ties with Taiwan, further isolating it, in favor of Beijing. Only seven countries in Latin America still recognize Taiwan, and they are facing “increasing pressure” to follow suit, according to the Council on Foreign Relations.

Simultaneously, China has helped fund and operate so many critical projects in South America that its presence there is ubiquitous. For example, It is now the largest investor in Peru’s mining sector and it manages Brazil’s second largest port, according to the U.S. House Committee on Foreign Affairs. It’s also invested heavily in the “lithium triangle,” which entails portions of Argentina, Bolivia and Chile and accounts for more than half of the world’s known lithium supply. Also in Chile, China-based companies control more than half of the electricity distribution.

Not all of China’s investments have lived up to expectations, though. For example, a hydroelectric plant in Ecuador has been riddled with construction problems, threatening the surrounding community. And a 2023 United Nations report that studied more than a dozen large-scale projects by the Chinese found negative effects on the environment and the local population.

Perhaps of even greater concern, however, is Beijing’s interest in building the architecture for a vast telecommunications network across the region. In Brazil, the tech giant Huawei last year rolled out its “5G city” project, and it has smart city initiatives in at least seven Latin American countries. In Venezuela, it funded development of the country’s Fatherland Card program that contains confidential information of residents.

Policy analysts note another important component of China’s Latin American strategy — the implementation of soft power initiatives. These are aimed at exposing, some would say indoctrinating, locals into Chinese cultures.

Beijing has established nearly 50 Confucius Institutes throughout the region; the majority are in South America with the heaviest emphasis in Brazil. And scholarship programs provide coveted college educations to Latin American students in China, including the teaching of Mandarin.

“This person will return, enter government and when the time comes to make a decision that’s favorable or not favorable to China, which way do you think this person will go?” Cruz asked during the panel discussion at Texas A&M.

Considering the multipronged strategy China has employed in Venezuela, Brazil, Chile and other Latin American countries, it’s easy to see how weak democracies desperate to build up economies could become even weaker, and authoritarian regimes become even stronger.

What should the U.S. do?

So what, if anything, should the U.S. government and even the private sector do in response? The same lackluster approach isn’t an option, yet neither is a heavy-handed defensive posture, despite the look and feel of a second Cold War.

President Joe Biden’s initiatives have done little to convince Latin America that the U.S. is seriously interested in partnering with it, many policy analysts say. We agree with those who say a comprehensive strategy must be vigorously pursued. But first a slice of humble pie is in order.

“We have an uphill battle and we need to be humble enough to acknowledge that we haven’t been the best neighbor,” Berg said. “Right now we just don’t have a concerted strategy. …There is a threshold beyond which we are not the preferred partner anymore. We are not beyond that but we are at the point where the muscle memory is changing.”

A comprehensive strategy must first start with diplomacy. Filling vacant ambassador positions in Latin America and the Caribbean should happen sooner than later. As of this writing, nine posts were empty, including that in Venezuela. Under Maduro’s rule that is unlikely to change, but other posts can and should be filled by savvy diplomats well-versed in China’s influence in the region.

Also, Biden must travel to Latin America, particularly deep into South America. It’s not lost on many leaders in the region that U.S. presidents have visited there only five times in the last decade. In an April commentary in Time, Julio Armando Guzmán, a former Peruvian presidential candidate, called those visits “paltry” compared with Xi’s commitments, and said the U.S. had shown “indifference” to the region amid China’s “silent invasion.”

An effective Latin American strategy must also include measures intended not to block China’s further investment, but to encourage it to play by the rules of democracy, ensuring transparency, rather than engaging in back-room deals with strings attached that could turn Latin American nations into economic puppets.

“It’s difficult for us to say that the Chinese are trying to overthrow governments,” Ellis said during the March panel discussion at Texas A&M. “But what the Chinese oftentimes do is provide resources with no political questions asked and they change the trajectory of the region and provide alternatives in ways that take it away from some of the dynamics we would promote in the region.”

Ellis noted in comments before a subcommittee of the U.S. Senate Committee on Foreign Relations in March 2022 that State Department programs could help Latin American countries with such things as project planning, anti-corruption initiatives and contract evaluation. Those are good ideas worth exploring.

And, of course, a strong Latin American policy must include economic measures.

“The answer lies in engagement and interest and investment,” said Cruz, adding bipartisan cooperation is necessary. “If we are worried about this and both parties agree that China is eating our lunch in the region, then why aren’t we doing something about it?…It just comes down to dollars that we’re not providing and that they need to get from somewhere.”

Cruz said the U.S. private sector is wary of investing in the region because of corruption, fear of not being repaid and the relatively small size of the infrastructure projects compared with those in the Middle East and elsewhere globally. The U.S. should consider incentives to private industry to mitigate those concerns.

Another area of focus for the U.S. in developing a meaningful Latin America policy is technology, “which we do very well,” he said. “Why aren’t we helping to build connectivity in Latin America? Why aren’t we partnering with the region on AI?”

In developing its strategy, the U.S. should avoid an us-versus-them or the white-hat/black-hat mentality. China is in the region to stay, analysts say. And the U.S., which has a robust trade policy of its own with Beijing, won’t convince its neighbors that doing business with it is bad. The U.S. instead must drive home that those business deals must be done free of levers that China can start pulling when it wants to get its way.

Ellis said the most effective U.S. policy in the region would emphasize “that we are fundamentally attached to Latin America by bonds of family, by bonds of geography” and in many other ways.

“When things go well or when things go bad in the region, it directly impacts the United States in ways it doesn’t directly impact China,” he said.

For that reason, the U.S. must win back the hearts and minds of the region. For now, their hearts seem to be with Beijing. Perhaps that was aptly demonstrated last winter when Chinese surveillance balloons floated over the continent, both north and south.

When U.S. officials spotted a balloon in our air space, it sparked high-level national security meetings. A fighter jet was sent up to shoot the balloon down over open water off the coast of South Carolina.

When a similar balloon drifted over Costa Rica, Venezuela and Colombia around the same time, reaction from those countries was far more relaxed. Instead of destroying it, officials just let it be. Such is the tolerant attitude toward China throughout much of the region today. Threats, even if perceived, are overlooked in the name of economic progress and partnership.

Source: The Dallas Morning News