In Latin America, a Biden White House facing a rising China
BUENOS AIRES (Reuters) – Donald Trump has been clear with Latin America during his four-year tenure: don’t do business with China. The message failed to reach the house.
As President-elect Joe Biden prepares to enter the White House on January 20, Beijing has tightened its grip on large swathes of the resource-rich region once seen as America’s political backyard.
A Reuters investigation, including interviews with current and former officials and advisers, and analysis of trade data, found that under Trump, China left the United States behind in power and influence in most of Latin America.
This poses a challenge for Biden, who pledged to restore Washington’s role as a world leader after years of Trump’s “America First” policies, and said the shift in American influence in Latin America was a threat to national security.
“They should be warned that Trump’s incompetence and neglect in Latin America and the Caribbean will end on the first day of my administration,” Biden told the Americas Quarterly in March. His team declined to comment for this story.
This commitment will not be easy to keep.
Since 2018, China has overtaken the United States as Latin America’s largest trading partner – if Mexico is excluded from the calculations – sucking in Andean copper, Argentinian grains and Brazilian meat. (Graphic: showdown between the United States and China in Latin America -)
Beijing has also stepped up investments and low-interest loans in the region, supporting energy projects, solar farms, dams, ports, railways and highways.
Former Bolivian President Jorge Quiroga explained China’s appeal in an interview with Reuters in La Paz earlier this year, adding that with local power Brazil it was the most important partner.
“People ask me who I prefer, the United States or Europe? I say Brazil. And in second place? I say China. This is the reality of South America, ”Quiroga said.
“TRUMP HAS SHOWN NO INTEREST”
Officials in the region have warned that China, a major economic and diplomatic partner for many countries, will be difficult to overthrow. Billions of Chinese dollars have given crucial lifelines to indebted emerging countries, a need that has been accentuated by the impact of the coronavirus pandemic.
“I think China is more interested in Argentina than the United States is in Argentina. And that’s what makes the difference, ”an Argentine government official told Reuters.
“Trump has shown no interest. Hopefully Biden does.
China is now the biggest trading partner of Brazil, Chile, Peru, Uruguay and others. It far exceeds the United States in terms of trade with Argentina.
Outside of Mexico, China’s trade with the region surpassed that of the United States in 2018 and expanded it in 2019 to more than $ 223 billion against US trade of $ 198 billion, according to an analysis of trade figures from the UN Comtrade database.
The United States remains much larger when Mexico – its largest global trading partner last year – is included. (Graph: Latin America: United States vs. China -)
The Trump administration was seen by some countries in the region as doing little more than shaking its finger at its Latin American counterparts for getting too close to China, especially through cheap funding or technological ties then. as the race for 5G domination intensifies.
Mark Feierstein, who advised former President Barack Obama, said Trump’s lack of engagement and exit from the Trans-Pacific Partnership trade bloc has created a void that China has filled – and that Biden will seek to reverse.
“What Trump has done is make China a better partner. This is all going to change,” said Feierstein, now senior advisor at Albright Stonebridge Group and CLS Strategies.
A Biden Democratic White House would likely give Latin America a higher priority, analysts and former advisers said, but would juggle that with a difficult recovery in the event of a pandemic and resetting ties in Europe and Asia. .
Janet Napolitano, former Homeland Security Secretary under Obama, said his experience of Biden was that he saw a “strategic advantage for the United States to have very strong relations in Central and South America.”
Biden will continue to push similar warnings against rapprochement with China, but could aim to win hearts and minds with offers of additional financial incentives and a return to humanitarian aid that Trump cut, experts said.
“(His administration) will recognize South America’s dependence on the Chinese commodities market, and will try much more energetically and generously to offer its support,” said Benjamin Gedan, former head of the Board of national security under Obama and now a researcher at Wilson. Center.
China seized the opportunity during the pandemic to deepen ties across Latin America, sending medical supplies, including ventilators and masks, to fight COVID-19.
In Argentina, the government has announced in recent months a series of new or expanded initiatives with China, vaccine trials, an expanded currency exchange, cooperation in space and a Chinese military studies course for students. of the national defense college of the country of South America.
The two countries discussed a possible state visit to China by President Alberto Fernandez and Argentina’s accession to Beijing’s Belt and Road Initiative.
Margaret Myers, China and Latin America program director at the Inter-American Dialogue, said that while Chinese sovereign lending has declined a bit, in its place has come commercial bank financing.
“China’s economic diplomacy, whether through trade or finance, has opened a wide range of doors,” she said, citing a $ 2.4 billion loan to Ecuador this year. by the China Exim Bank.
The United States had appeared to change course in the months leading up to last month’s presidential election, deploying its own set of initiatives in the region in an attempt to compete with China, though many saw them as too few. too late.
“It’s a big power competition, and it’s being played all over the world, including Latin America,” said a senior US administration official, who asked not to be named. “We have a strategy and we are pushing back.
Francis Fannon, deputy secretary of the State Department for energy resources, recently visiting Brazil, Chile, Ecuador and Panama, said the pandemic risked pushing some countries in the region towards partners like China.
“With COVID, it affects economic decision-making and affects the psychology of countries. We want to encourage countries to continue on the reform path they have been on, ”Fannon told Reuters.
“The United States is the partner of choice. It has been and continues to be. “
Report by Cassandra Garrison in Buenos Aires; Additional reporting by Andrea Shalal in Washington and Jamie McGeever in Brasilia; Editing by Adam Jourdan and Daniel Wallis