Over the past decade, China has emerged as an increasingly important trade and development partner for Latin America. Most recently, it demonstrated its remarkable synergy with regional leaders during an event in Beijing. This defensive strategic move is meant to shore up alliances. It gets us closer to countering the economic damages caused by President Donald Trump’s trade war policies.
China’s announcement of a 66 billion yuan credit line at the event was eye-popping. This adds up to $9.2 billion, intended to increase fund accessible financing for countries within Latin America and the Caribbean. This financial investment reveals China’s growing influence in the region. Last year, the two-way trade surpassed that $500 billion milestone for the first time ever.
China is making almost daily moves to expand its influence in Latin America. Much of this growth has come from an increase in these kinds of agricultural imports—like soybeans and beef—and energy resources—crude oil, iron ore, and critical minerals. China has been increasing its economic cooperation in crucial sectors. These are green energy, 5G telecom, the digital economy, AI, and world security.
At this week’s event, Chinese President Xi Jinping underscored the necessity of joint partnership. He said that China was prepared to work with Latin American countries to forge “more closely-knit ties.” He announced five signature initiatives. These initiatives aim to deepen political dialogue, increase mutually beneficial economic cooperation, expand people-to-people, cultural, and educational exchanges, and improve global security between China and Latin America.
This was further consolidated last week when Xi Jinping announced that as a show of support, China would grant visa exemptions to citizens of five Latin American countries heading to Chinese territory. This effort will likely grow to include additional countries in the coming years. He suggested China invite 300 representatives of Latin American ruling parties to China annually for three years. Further, he seeks to create 3,500 government funded scholarships and other exchange programs.
With his recent historic decision, Colombian President Gustavo Petro made a way. Simultaneously, he made good on his promise that Colombia was going to join China’s Belt and Road Initiative (BRI). This effort seeks to advance infrastructure and investment focused improvements. It’s full of thrilling projects, like deploying 5G networks and developing new ports and hydropower plants throughout the region.
In light of the ongoing trade tensions with the United States, Xi Jinping remarked on the futility of tariff wars:
“There are no winners in tariff wars or trade wars.” – Xi Jinping
China’s proactive positioning in Latin America is evident. This decision further demonstrates its interest to broaden its role and provide an alternative to U.S. influence across the region. As economic relations grow deeper in coming years, there is greater potential for both sides to benefit from increased cooperation and mutual support.
