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As
President-elect Joe Biden readies to enter the White House on
Jan. 20, Beijing has tightened its grip over vast swathes of the
resource-rich region once seen as the United States' political
backyard.
A Reuters investigation, including interviews with current and
former officials and advisers, and an analysis of trade data,
found that under Trump, China has left the United States
trailing in terms of power and influence across most of Latin
America.
That poses a challenge for Biden, who has pledged to restore
Washington's role as a global leader after years of Trump's
"America First" policies, and has said that slipping U.S.
influence in Latin American is a threat to national security.
"They should be on notice that Trump's incompetence and neglect
in Latin America and the Caribbean will end on day one of my
administration," Biden told Americas Quarterly in March. His
team declined to comment for this story.
That pledge won't be easy to fulfill.
Since 2018, China has overtaken the United States as the biggest
trade partner to Latin America - if Mexico is removed from the
calculations - hoovering up Andean copper, Argentine grains and
Brazilian meat.
Beijing has ramped up investment and low-interest loans to the
region too, backing energy projects, solar farms, dams, ports,
railway lines and highways.
Bolivian ex-President Jorge Quiroga explained the draw of China
during an interview with Reuters in La Paz earlier this year,
adding that along with local powerhouse Brazil it was the most
important partner.
"People ask me who I prefer, the United States or Europe? I say
Brazil. What about in second place? I say China. That's the
reality of South America," Quiroga said.
'TRUMP DIDN'T SHOW ANY INTEREST'
Officials in the region cautioned that China, a major economic
and diplomatic partner for many nations, will be difficult to
unseat. Billions of Chinese dollars have given crucial lifelines
for indebted emerging countries, a need that has been sharpened
by the impact of the coronavirus pandemic.
"I think China has more interest in Argentina than the United
States has in Argentina. And that is what makes the difference,"
an Argentine government official told Reuters.
"Trump did not show any interest. Let's hope Biden does."
China is now the number one trade partner to Brazil, Chile,
Peru, Uruguay and others. It far outstrips the United States in
terms of trade with Argentina.
Outside of Mexico, China's trade with the region overtook the
United States in 2018 and extended that in 2019 to more than
$223 billion versus U.S. trade of $198 billion, according to an
analysis of trade figures from the U.N. Comtrade database.
The United States does remain far larger when Mexico - its top
trade partner globally last year - is included.
The Trump administration was viewed by some countries in the
region as doing little more than finger-wagging at Latin
American counterparts for getting too close to China,
particularly through cheap financing or technology ties as the
race for 5G dominance heats up.
Mark Feierstein, who advised former President Barack Obama, said
Trump's lack of engagement and exit from the Trans-Pacific
Partnership trade bloc created a vacuum that China had filled -
and that Biden will look to reverse.
"What Trump has done is make China look like a better partner.
All that will change," said Feierstein, now a senior adviser at
Albright Stonebridge Group and CLS Strategies.
'STRATEGIC ADVANTAGE'
A Democratic Biden White House would likely give greater
priority to Latin America, analysts and former advisers said,
though will be juggling that with a tough pandemic recovery and
resetting ties in Europe and Asia.
Janet Napolitano, former secretary of homeland security under
Obama, said her experience of Biden was that he saw a "strategic
advantage to the United States of having very strong relations
throughout Central and South America".
Biden will keep pushing similar warnings against getting close
to China, but may aim to win back hearts and minds with offers
of more financial incentives and a return to humanitarian aid
that Trump cut, experts said.
"(His administration will) recognize the dependence in South
America on the Chinese market for commodities, and try much more
energetically and generously to offer support," said Benjamin
Gedan, a former National Security Council official under Obama
and now a scholar at the Wilson Center.
ECONOMIC DIPLOMACY
China seized the opportunity during the pandemic to deepen ties
across Latin America, sending medical supplies including
ventilators and masks to combat COVID-19.
In Argentina, the government has announced in recent months a
flurry of new or expanded initiatives with China, vaccine
trials, an extended currency swap, cooperation on space, and a
Chinese military studies course for students at the South
American country's national defense college.
The two countries have discussed a potential state visit to
China by President Alberto Fernandez and about Argentina joining
Beijing's signature Belt and Road Initiative.
Margaret Myers, director of the China and Latin American program
at the Inter-American Dialogue, said that while Chinese
sovereign lending had dipped a bit, in its place had 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 China Exim Bank.
The United States had appeared to change course in the months
leading up to last month's presidential election, rolling out
its own set of initiatives in the region in a bid to compete
with China, though many saw these as too little, too late.
"This is a great power competition, and it's playing out all
over the world, including Latin America," said one senior U.S.
administration official, who asked not to be named. "We have a
strategy and we're pushing back."
Francis Fannon, State Department Assistant Secretary for Energy
Resources, fresh off a visit to Brazil, Chile, Ecuador and
Panama, said the pandemic risked pushing some countries in the
region towards partners like China.
"With COVID, it is affecting economic decision making and is
affecting the psychology of countries. We want to encourage
countries to continue on the reform-minded path that they have
been on," Fannon told Reuters.
"The United States is the partner of choice. It has been, and
continues to be."
(Reporting 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)
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