China and the United States in the Andes

Politics in the Andes in the post–Cold War era are not at the mercy of “inter-national” dynamics but are mostly affected by global economic trends. While the United States and China have somewhat distinct approaches—in part determined by their own positions in the global economy—they both deepen the entrance of global markets in the region. Economic competition within a U.S.- and China-centric business-led globalization poses important challenges for industrialization and socially and environmentally sustainable development in the Andes. The four countries here analyzed (Chile, Peru, Ecuador, and Colombia) are thus in a curious position. Their civil societies are as vibrant as ever, and their national politics more immune to foreign intervention, yet they increasingly face similar economic and environmental pressures through their investment, trade, and finance links with the world’s two largest economies.

A Structural Explanation for Sino-US-Venezuelan Relations

US-Venezuelan relations display both confrontation and cooperation. Chinese relations with Venezuela are a most likely case for rebellion against the global governance system over which the US presides. This chapter makes a structuralist argument, arguing that the way that the three countries are positioned within global and regional governance structures conditions the underlying character of their relations with each other. Simply put, the US, China, and Venezuela have very different interests and capabilities and their structural positions in South America explain why the increased Chinese presence in Venezuela is neither a threat to the US nor does it substantially aid Venezuelan intentions toward multi-polarizing the region or world. To make this argument, the chapter assumes that US foreign policy toward Venezuela is informed by its position as regional hegemon, Chinese foreign policy toward Venezuela is informed by its position as an extra-regional commercial state, and Venezuelan foreign policy toward both is informed by its position as a petrostate.

Is There a LatAm-US-China Economic Triangle?

Latin America experienced economic ups and downs in the past decade, and faces a gloomy outlook for 2015–2020. This chapter first delineates the near-term growth prospects for the region, examining the subregional patterns closely with three national cases—Argentina, Brazil, and Venezuela—and analyzing the external constraints for the region’s economic growth. It then examines the major challenges ahead for the region with analysis of Latin America’s economic relationship with the United States and China, respectively. On the one hand, while the U.S.’s current bilateral approach leaves the economic relationship with the region fragmented, the economic and trade cooperation between the U.S. and Latin America can be strengthened through fostering productive integration and the development of regional value chains oriented toward the U.S. market. On the other hand, China’s growing presence in the region poses challenges to Latin America countries, namely achieving export diversification, diversification of Chinese investments in the region, and Latin investment in China and Asia-Pacific.

China’s Security Challenge to the United States in Latin America and the Caribbean

The national security challenge presented by the People’s Republic of China (P.R.C.) to the United States in the Western Hemisphere is principally long-term and indirect. It is a challenge that is widely misunderstood, and only partly related to the growing activities of P.R.C. armed forces in the hemisphere. The severity of the challenge, and its potential to transform from a difficult-to-define erosion of U.S. global position and long-term prosperity to an acute military threat, will depend, in part, on the adeptness of U.S. policymakers in navigating the landscape of threats and opportunities stemming from the rise of China as a dominant global actor. Whether U.S. policymakers are successful or not, China’s presence in the Western Hemisphere will likely continue to be a defining consideration for U.S. national security in the mid-21st century. The purpose of this chapter is to discuss that security challenge and the response of the U.S. to date, and to offer recommendations for U.S. policymakers.

U.S., China, and Brazil

China and the U.S. are currently the two most important trade partners of Brazil. Brazil is engaged in complex bilateral relations with both countries in political, security, and economic affairs. This chapter is divided into four sections. The first one compares Brazil’s bilateral relations with the U.S. and China by reviewing the developments of their diplomatic relationships in the past decades. The following section discusses how China’s rise may affect U.S. interests in Brazil and its region. The third section analyzes areas in which the competition between the U.S. and China could be positively affected by Brazilian courses of action in foreign policy. Finally, there is an analysis of possible U.S. foreign policy orientations toward Brazil and its region.

The New and Not-So-New Foreign Policies in the Americas

Calculations of national interest and foreign policies are shifting in Latin America and the Caribbean. Those changes stem from the rise of the Global South, the perceived decline of U.S. power, and the proliferation of multiple connections and relations, including new regional multilateral groups. Those variables, however, are shaped by individual country legacies and a regional reflex toward national sovereignty and solidarity. This newfound diplomatic muscularity will shrink as the region’s and China’s economies cool, but the sense of independence and the region’s contestation of U.S. policies will continue.

Conclusions and Comparisons to Developments in Central and Southeast Asia

The concluding chapter examines the U.S.-China relations from both economic and geopolitical perspectives in Latin America and Caribbean, and also in a broader context, namely, Central Asia, Southeast Asia, and Latin America and the Caribbean. China, as the rising power in Latin America and the Caribbean, is using economic and political incentives to explore how best to maximize its interests in a region, which is formerly dominated by the U.S. The U.S., on the other hand, as the status quo power in the region, finds low levels of Chinese trade and investment unthreatening, yet is likely to respond to China’s potential geopolitical ambitions in the region. In the broader context, great power politics is alive and well—both China and the U.S. are faced with their own domestic challenges influencing their presences in the three regions.

Strategic Aspects of the China–Latin America Interaction

China has increasingly acted as a full-fledged global player, as in the evolving strategic partnership with Latin America for the past decade. The main concern is whether China will become a potential threat to the US in the region, even though it does not claim to seek such a role. China’s new presence in Latin America coincides with a retreat of the U.S. from the region and the rise of leftist politicians in Latin America. It is a misperception that China is responsible for these developments. Part of the concerns of China’s presence in Latin America was brought by the spread of terrorism and the rise of Asia, as well as local responses to neo-liberal reforms in the region. However, both China and Latin American countries are exploring their new ties to adapt to an international system with power shifts and diffusion. A strong and sustainable tie between China and Latin America will enhance each other’s international status, regardless of their current domestic transitions.

China’s Rise in Latin America

China’s growing presence in Latin America is among the most visible trends in the Western Hemisphere. Through trade and investment, China has reshaped the economies of several countries in the region, raising concerns both in Latin America and the United States. This study examines Chinese economic involvement in Latin America, focusing on trade, direct investment, and finance, and making five arguments. First, due to weaker growth in both China and Latin America, China’s regional economic expansion will slow down in coming years. Second, China is keen to forge closer ties with Latin America, but the idea that it has become a major target of Chinese expansionism is delusional. Third, Beijing talks a lot about South-South cooperation, but this has been more principle than actual practice. China no longer belongs to the periphery of the global system; it has become part of a semi-periphery. Fourth, some argue that emerging economic ties are detrimental to Latin America. In fact, the rise of China presents both challenges and opportunities for the region’s development. Fifth, there is a false fear that China poses a looming threat to American interests in Latin America. There is little evidence that Beijing seeks to upend U.S. regional dominance.

Central America and the Caribbean’s Relations with China and the United States

The United States has been and continues to be the dominant and unchallenged global power in Central America and the Caribbean. Meanwhile, China’s economic, diplomatic, and psychological presence in the Caribbean and to a lesser extent in Costa Rica has increased during the last decade. This economic rise of China and its growing involvement in international affairs has prompted a discussion about whether China’s growing presence in the Caribbean is a trend about which the U.S. should be concerned and whether it portends a challenge by China in the way that it is jousting with the U.S. over influence in the Pacific Ocean and Asia. This chapter begins with a brief review of U.S.-China relations and the Obama administration’s China policy, and then examines the diplomatic, economic, and cultural relations between Central America and the Caribbean and China. It concludes that China’s increased presence in the Central America and the Caribbean and the deepening of its relations with some of these countries does represent a challenge to the position and traditional role of the United States in this region.