China is not shy about taking on the US in Latin America
American hegemony in its 'backyard' may be entering its final years
Carlos Eduardo Pina is a political scientist specializing in the relationship between China and Latin America. He is a contributor to the project "Analisis Sinico" at www.cadal.org and member of the Chinese Academic Network on China Latin America (Red ALC-China).
In response to Donald Trump's trade war with China, Xi Jinping's government is pursuing a strategy to mitigate the negative impact of American tariffs on the Chinese economy. The government has also adopted a diplomatic policy that positions China as a responsible great power, contrasting with the erratic and unpredictable leadership of the U.S. president.
This strategy was laid out for all to see on May 13, when the Chinese government hosted the fourth ministerial meeting of the Community of Latin American and Caribbean States (CELAC). The meeting was more than just a declaration of intent between China and Latin American countries to boost economic cooperation. It was also a demonstration of how China can compete with the U.S., even in its historical "backyard."
To provide context for this meeting, it is important to note that the relationship between China and Latin America has evolved significantly in the early years of the 21st century.
Beijing has considered this region strategic in planning its foreign policy, pursuing at least three main goals: 1.) ensuring an ample supply of natural resources (e.g., oil, copper, natural gas and lithium) and raw materials (e.g., soybeans, bananas and coffee), to supply its energy and food needs; 2.) to defend and promote its One China Principle, gaining diplomatic recognition from Central American countries that, at the beginning of the century, maintained bilateral relations with Taiwan; and 3.) to establish a presence for itself, its companies, and its political and diplomatic networks in a region on the periphery of the U.S.
The results have been astonishing for both sides. Trade exchanges grew from $12.4 billion in 2000 to $486.5 billion in 2023, according to the World Bank. Direct investments by Chinese companies in Latin America reached $200.3 billion, according to Academic Network on China and Latin America and the Caribbean.
Additionally, Chinese banks have lent the region approximately $120 billion to finance infrastructure projects. In return, Beijing obtained diplomatic recognition from six new Central American countries, further isolating Taiwan, and secured the neutrality and/or support of some Latin American countries on controversial issues such as its claims in the South China Sea, and its stance on Taiwan, Hong Kong and Xinjiang.
China is also using its ties with the region to counterbalance the trade war initiated by Trump. This is despite the U.S. desire for countries in this geographic area to support its strategy of isolating China on a global scale. Washington's actions to isolate China in its traditional area of influence include pressuring Panama to withdraw from the Belt and Road Initiative, discouraging the Mexican government from accepting new Chinese investments , imposing tariffs on third countries that purchase Venezuelan oil and pressuring the Hong Kong-based company CK Hutchison to sell its stake in two of the five ports on the Panama Canal.
Beijing has taken note of these actions and counterattacked. In his opening speech at the China-CELAC Forum, Xi encouraged regional countries not to tolerate bullying attitudes that influence their economic relations with China. The Chinese leader offered to increase cooperation with these countries, providing new loans and investments as well as political and diplomatic support. This demonstrates China's commitment to being a leader of the Global South and a counterweight to "hegemonic" pressures from Washington.
For those familiar with Latin American history, these statements are an almost-unprecedented direct challenge to U.S. policies in the region. Beijing is no longer shy about the prospect of great-power confrontation with the U.S. in Latin America. This demonstrates its willingness to leverage its economic prowess and the extensive network of political connections it has cultivated over the past 25 years. The most relevant aspect of this strategy is that it has a good chance of succeeding, as many countries in the region support Beijing as an alternative power to the U.S.
Undoubtedly, a new stage in Latin American history is beginning, one in which the U.S.'s undisputed leadership may be entering its final years.
China's commitment to developing and strengthening relations with countries from the Global South has yielded it tangible results on the global stage. Rather than a crisis, the trade war has presented Beijing with an opportunity to hasten its establishment as a major power on the international stage.