China's Growing Footprint in Latin America

Yesterday Canning House corporate members met with ChinaDialogue and Diálogo Chino to discuss the controversial Chinese Belt & Road Initiative (BRI), a multibillion dollar project made up of a “belt” of overland corridors and a maritime “road” of shipping lanes. Since 2013, more than 130 countries have signed deals or expressed interest in projects aimed at boosting trade along these routes. 

Isabel Hilton OBE introduced the subject, commenting that while China’s outward movement has been impressive, it has not been unproblematic. The BRI has attracted particular criticism for its impact on the environment and concern over the debt burden placed on small or weak economies.

Ma Tianjie provided some background to the ambitious initiative, explaining that it was originally conceived as being a means for connecting landlocked Western China with SE Asia, and there is now less clarity about the intensions or strategy behind it, with Latin America being added in relatively “last minute”. Although there was no mention of sustainability in the ‘Five Pillars’ outlined in the first Belt & Road Forum, China has since committed to developing the initiative in line with the UN sustainability goals, with the focus being on planting trees, rather than tightening industry regulations on emissions.

Andrés Bermúdez Liévano discussed the widening Chinese presence in Latin America, with nineteen countries signed up to the BRI so far, including Chile and Peru. Andrés concluded that China’s footprint in Latin America is large, not only as a result of the oil-intensive projects being developed in many of the countries (within and outside the BRI), but also through the increasing demand in China for beef and soya, which is fuelling deforestation in the Amazon. Latin America still relies heavily on selling commodities, and despite in-roads being made to develop other sectors, Andrés reflected that there should be a greater push for clean energy production.

The audience then had a chance to ask questions, highlighting some of the positive changes observed in China's presence in Latin America, such as more stakeholder engagement at a local level, and also some of the contradictions in its environmental policy, for example the tension between China’s own domestic efforts to cut emissions and its coal-heavy projects abroad.