With annual trade between China and Latin America reaching almost US$ 486 billion in 2022 – which is almost an eight percent increase from the previous year – Beijing has already become one of the top trading partners of this region. During the Belt and Road Initiative Forum held last month in China, 26 new agreements worth US$6.32 billion were signed. China, in short, has secured a deep footprint in the US backyard, turning the Monroe doctrine – which said that any intervention in the political affairs of the Americans would be considered a hostile act against the US – upside down. The Biden administration, while never unaware of China’s growing presence in the region, is now changing its gear to push China back and offer ‘an alternative’ source of trade and development. Latin America has been an important region for the US. With Brazil, all set to assume the presidency of the G-20 next year, it is going to become even more important geopolitically.
Therefore, Washington’s renewed interest is to protect the backyard from being dominated completely by China. Earlier this month, Biden hosted several Latin American and Caribbean leaders to re-affirm a joint approach towards several areas of interest. Kicking off the inaugural Americas Partnership for Economic Prosperity, Biden said that the goal was to “harness the incredible economic potential of the Americas and make the Western Hemisphere the most economically competitive region in the world.”
This ‘competitiveness’, according to Biden, can be achieved only if the two regions reject China and embrace the US. Reminding – and seeking to convince – the leaders and officials from Barbados, Canada, Chile, Colombia, Costa Rica, Ecuador, Peru, Uruguay, Mexico and Panama, Biden told them “they have a real choice between debt-trap diplomacy and high-quality transparent approaches to infrastructure and inter-development”.
Why does Biden want to counter China? The reason is the ways that China has comprehensively rendered the US influence developed over at least two centuries irrelevant. As a recent report in the US-government-run United States Institute of Peace said, the US-Latin America ties have “more than 200 years of shared history, culture and economic interdependence.” What comes as a shock to Washington is how China, despite the region’s deep integration with the US, has been able to infiltrate the region and is already all set to displace the US as the region’s largest trade partner. There is, therefore, no denying that the US is facing strategic competition in Latin America that did not exist on such similar scales ever.
For instance, even though the Soviet Union had some presence in the region, the nature of the Soviet-Latin American engagement was predominantly military. China, on the other hand, does not present a direct military challenge. It presents an economic challenge on a scale that demands a bigger US response. China is building airports and railways and providing cheap technology. More importantly, China, unlike the Soviet Union, is not looking to export its ideology. On the contrary, the Chinese position has been – and not just regarding Latin America – to leave politics aside and focus on the economy. Still, the US counter-offensive on China includes two obvious political elements. The US calls, as Biden did in his meeting, China a ‘debt-trapper’, which can compromise any given country’s sovereignty. Secondly – and more recently – Washington has also begun to characterise China in communist terms too (this is despite the fact that China has now completely opened itself to foreign investment).
In September 2023, Mileydi Guilarte, Deputy Assistant Administrator for Latin America and the Caribbean, told the House Foreign Affairs Subcommittee on the Western Hemisphere that “Communism was on our doorsteps” that was exerting a “malign influence in Latin America”.
For the US, projecting China as a ‘villain’ and increasing its own so-called ‘transparent’ investment is also tied to its overall policy of containing China’s global influence. So, whereas China does not involve itself in regime-change politics (as opposed to the US), China’s predominantly economic engagement with Latin America still yields crucial political outcomes that have global implications. For instance, in 2018, Panama joined China’s BRI. A year before, Panama also joined a club of countries that have severed diplomatic relations with Taiwan. By doing that, Panama not only became the first country in the Western Hemisphere to embrace Beijing’s stance on Taiwan, but also started a trend that is growing. In March 2023, another Latin American nation, Honduras, severed ties with Taiwan.
While reports in the US mainstream media explained this development with reference to China’s growing investment in the region/country, the foreign minister of the country confirmed that Taiwan had repeatedly ignored their requests to increase its aid and investment, leading to the country’s decision to sever ties and embrace China as the source that can fulfil Honduras’ needs.
From the US perspective, growing acceptance of China’s investment and its stance on geopolitical issues, such as Taiwan, is counter-productive to the politics of de-coupling, containing, and isolating China. If anything, Latin America’s embrace of China reveals patterns of coupling, expansion, and integration – something that has been at the heart of China’s BRI project ever since it was launched in 2013.
China’s continued expansion also shows that the US projection of Beijing as a ‘debt-trapper’ and as the flag-bearer of communism has not been able to wean Latin America away. As Guilarte herself mentioned in her above-quoted statement, “Since launching the Belt and Road Initiative (BRI) in 2013, Beijing has become the region’s largest provider of official finance. Between 2013 and 2020 the PRC offered more than US$215 billion in financing, largely for infrastructure projects.” Although she also said that this financial investment comes “with strings attached”, there is no denying that the US has grown apprehensive about China’s growing success – not just in Latin America but also the rest of the world.
Salman Rafi Sheikh, research-analyst of International Relations and Pakistan’s foreign and domestic affairs, exclusively for the online magazine “New Eastern Outlook”.