With a library here, a power plant there, China is using aid and investment to expand its presence in Central America, posing a challenge to the United States’ 200-year-old diplomatic dominance in the region.
China’s interest is driven in part by its rivalry for diplomatic recognition with Taiwan, a self-governing island that has claimed to be China’s legitimate government since the Communist victory on the mainland in 1949. But Beijing is also open about its ambition. to supplant the United States as the dominant power in the world.
Influenced by Beijing’s dollar diplomacy, three Central American countries – Panama, El Salvador and Nicaragua – have transferred diplomatic recognition from Taiwan to China since 2017. The same goes for the neighboring Caribbean island nation. , the Dominican Republic.
Costa Rica, Honduras, Guatemala and Belize round out the nations of the isthmus linking North and South America, a region claimed for the first time as part of the American sphere of influence with the enunciation of the Monroe Doctrine in 1823.
Luis G. Solis, acting director of the Kimberly Green Latin American and Caribbean Center at Florida International University, told VOA Mandarin that the United States still has an advantage in the region in terms of military, economic, commercial and cultural affairs.
“If these advantages are properly managed through proactive diplomacy and a strong development program, China’s space will be significantly reduced,” he said. “But it requires creativity, an investment of time and goodwill, and an ongoing and productive dialogue on sensitive issues such as migration, corruption and transnational organized crime.”
China’s most recent investment was in El Salvador, where President Nayib Bukele thanked China for funding the country’s new national library as construction began Feb. 6.
The $40 million cultural center, located in the capital San Salvador, is the result of Bukele’s visit to China in 2019, according to Evan Ellis, senior associate with CSIS’s Americas program. The president also secured $500 million for projects including a sports stadium, a new tourist pier, improvements to his water treatment facilities as well as support for his Surf City project to transform the Pacific coast of country into a beach vacation destination, according to the CSIS 2021. article, China and El Salvador: an update.
Also in 2019, El Salvador signed with China’s controversial Belt and Road Initiative (BRI) a global infrastructure plan consisting of a “belt” of land corridors and a maritime “road” of shipping lanes.
Bukele’s efforts came after El Salvador severed ties with Taiwan in 2018 under the leadership of his predecessor, Salvador Sánchez Cerén, who led the fight against a US-backed regime during a civil war that left lasted from 1979 to 1992.
According to an article by Daniel Runde, Director of the Americas Program at CSIS, China’s rise in Central America has increased since the transfer of management of the Panama Canal from the Joint US-Panamanian Commission for the Panama Canal to the Republic of Panama in 1999.
In November 1999, the Panamanian government awarded the Hong Kong-based company Hutchison-Whampoa concessions to operate ports on both the Atlantic and Pacific sides of the canal, according to the DialogoChino website.
Since then, “Chinese companies have been heavily involved in contracts related to infrastructure in and around the canal, in the logistics, electricity and construction sectors in Panama“, according to DialogoChino.
In 2017, Panama moved diplomatic ties from Taiwan to Beijing and five months later became the first country in the region to join the BRI. Since then, China has invested in more than 20 infrastructure projects in the country, including bridges, railways and power stations. As of January, Belize, Guatemala and Honduras are not BRI partners with China.
Chinese state media world times published an opinion piece on December 13, 2021 by Pan Deng, Executive Director of the Law Center of the Latin America and Caribbean Region of the University of Political Science and Law of China. He suggested that the United States sees Central American countries as “sources of cheap labor and low-end industrial raw materials, but also the dumping ground for outdated American industries.”
The article went on to say, “Previously, these countries had no choice but to turn to the United States. However, as China has developed rapidly in recent years, a reference model is provided on how developing countries can move from backward agricultural countries to industrialized countries. while achieving long-term social stability.”
Analysts say Beijing is using aid in various forms to persuade more Central American and Caribbean countries to establish formal relations with the People’s Republic of China (PRC).
Benjamin Gedan, deputy director of the Latin American program at the Wilson Center, told VOA Mandarin that Beijing has an economic program in Central America and the Caribbean, but that effort is largely driven by geopolitical considerations, “including its rivalry. bitter with Taiwan and its desire for support in multilateral institutions.
“Given the Chinese Communist Party’s intense focus on isolating Taiwan, it is likely to continue investing in Central America and the Caribbean. After all, Beijing probably sees these countries as relatively cheap to buy, and it has had a string of diplomatic victories,” Gedan added.
Another goal of China’s efforts in the region is to expand the BRI to Central America, to play a bigger role on the world stage.
In December 2021, Cuba became the latest country to join China’s Belt and Road Initiative. Jamaica joined in 2019, as did six other Caribbean island nations, and Costa Rica joined in 2018.
China has also increased its investment in natural resources in Central America and the Caribbean Basin. According to the Congressional Research Service, in 2020, Chinese imports from Latin American and Caribbean countries amounted to $165 billion, consisting mainly of natural resources, such as minerals (35%), mineral fuels (12%) and copper (6%).
Rebecca Ray, senior academic researcher at Boston University’s Center for Global Development Policy, told VOA Mandarin that she was not surprised to see China’s interest in infrastructure cooperation with Central America and productive investments in the Caribbean.
She pointed out that the Central America region had been suffering from low economic growth for decades. It is also vulnerable to climate change, which brings more natural disasters to low islands and coastal areas. As a result, according to Ray, these countries have a greater need for new inward investment.
“At the same time, Western investors have not shown interest in starting new projects or being exposed to developing country economies during the COVID-19 pandemic. So any potential new source of investment will naturally be taken seriously,” she added.
Despite the need to invest in infrastructure in Central America and the Caribbean, the main obstacle to maintaining economic growth could be poor governance, according to an online magazine Dialogue.
“The partnership with China could attract new foreign investment, but it only compounds governance problems, given China’s disinterest in corruption, its lack of transparency and its export of technologies that enable governments to ‘Central America to restrict civil liberties,’ Gedan said.
Microsoft said in December 2021 that it believed Beijing-backed hackers were targeting private and public sector organizations in five Central American countries: Dominican Republic, Ecuador, El Salvador, Honduras and Panama.