China’s Influence in Latin America: Trade, Technology, and Soft Power

For Chinaworld technological power, one of the attractions of the region -apart from raw materials such as military or the Petroleum— are the critical minerals for energy transformation. For this reason, as Anna Ayuso, senior researcher at the Barcelona Center for International Affairs (CIDOB) indicates, “Latin America is yet another scenario of the trade and technology war between China and the United States“, in addition to the culmination of the New Silk Roadthe Chinese commercial megaproject.

USA does not hide its discomfort at the penetration of the Asian giant throughout the globe. “They see that they are losing influence in an area where, naturally, they should have it, mainly for historical, geographical and cultural reasons,” says Alicia García-Herrero, a senior fellow at Bruegel and chief economics director for Asia-Pacific at Natixis. But Beijing’s interest in Latin America is nothing new. In 2010, the Chinese market represented less than 2% of Latin American exports; in 2008 they reached 31%, with a value of 180,000 million dollars; and, in 2021, 450,000 million, according to data from the Council on Foreign Relations. In return, China, which has free trade agreements with many of the countries, it imports goods manufactured in the region. So, China has become the main trading partner of South America and the second (after the United States, which maintains its presence in Mexicoand much of Central America and the Caribbean) of Latin America as a whole.

Infrastructures, loans and ‘soft power’

In recent years, the chinese foreign policy It has also focused on the construction of infrastructures, most of them related to extractive industries for the exploitation of natural resources. However, the diplomatic strategy of the asian giant goes further with projects such as building a radio telescope in Argentina or a football stadium and a library in The Saviorafter what the Central American country broke relations with Taiwan. “Several Latin American countries have changed their position for economic interests,” says Ayuso. More than half of the few countries that recognize the island are in Latin America and the Caribbean (Belize, St. Lucia, Paraguay y Haiti, among others). “They are small countries that depend a lot on taiwan and are close to USA“, clarifies Pablo Pareja, an expert on Chinese foreign policy from the Barcelona Institute of International Studies.

In addition, China also grants loans to some countries such as Venezuela, Bolivia, Ecuador o Argentinawhich helps reduce the economic dependence of USA by these countries. However, “they increase it with respect to another potency,” explains Pareja. “Latin American countries don’t want a substitute, they want balance,” she adds.

China penetrates not only economically and diplomatically, but also culturally, with, for example, the Confucius Institutes –created to promote the Chinese language and culture–, which are found in many countries and also in Latin American cities such as Buenos Aires, Brasilia, Buenos Aires, Medellín, Saint Joseph o Havana. In this sense, as Pareja points out, “there is a deployment of a soft strategy and no use of the military pillar has been seen.”

A flexible partner

In Latin American public opinion, “the effect of the Chinese presence is favorable,” says Ayuso. According to Couple, “China appears as a more sensitive ally, since it does not demand as many political conditions as West“. During the tenure of Barack Obamathere was an attempt to rapprochement with the region, although the situation in Venezuela y Nicaragua he complicated it; the presidency of Donald Trump It was a “difficult time,” says Ayuso. Trump “only conceived of Latin America for immigration and drug trafficking“. Also, with the pandemic, USA y Europa They had millions of doses of vaccines that they did not reach the subcontinentand went China who saw the opportunity to export their vaccines to the countries of the region. “Latin Americans think that we have forgotten them and China comes with solutions“, explains García-Herrero. “Now China occupies spaces that the United States forgot,” adds the expert.

Mario Esteban, lead researcher at the Elcano Royal Institute, doubts whether “the weight that China has at a commercial level will be able to be transferred to the political and soft level.” According to Esteban, “the Latin American authoritarian countries they use China as a counterweight but not as a model”, but the Chinese influence in the perpetuation in power of regimes that USA considered hostile — such as Venezuela, Nicaragua o Cuba— worries experts. Although Beijing always insists that it is not concerned with the internal politics of other countries, “Latin America’s turn towards populism and leftist governments is undoubtedly related to China and, in some way, also with Russia, although to a lesser extent“, underlines García-Herrero.