The $300 billion in annual trade with Latin America supports 900,000-plus U.S. jobs, with more than a quarter of those resulting from trade with Brazil. Brasília, the capital, is Obama’s first stop in a five-day, four-city excursion that also includes Rio de Janeiro; Santiago, Chile; and San Salvador, El Salvador. Brazil has gone “from a country that needed an IMF loan just a matter of years ago to now having $300 billion in reserves,” says Froman. The focus on Brazil is part of a broader effort by the Administration to engage more with the so-called BRIC countries, the emerging economies of Brazil, Russia, India, and China. (Obama has already visited Russia, China, and India.)

It’s also an opportunity to cement relationships as China’s economic power increases. In 2009, China bumped the U.S. as Brazil’s top trading partner. Obama isn’t expected to announce any major business deals or agreements on the trip, as he did during last year’s India visit. Nor does the White House expect to resolve long-standing trade disputes with Brazil. The world’s largest producer of sugar and sugar-cane-based ethanol, Brazil has long pressed the U.S. to lower tariffs on sugar imports and a 54 cents-per-gallon surcharge on ethanol imports.

Instead, say Administration officials, the trip is about building a framework for the future. For example, Brazil’s recent discovery of offshore oil gives it claim to reserves twice the size of the U.S.’s, Froman says. The Administration has its eye on that oil—and so does China. China Petroleum & Chemical last month said it may bid on exploration rights and has already taken a 40 percent stake in the Brazilian unit of Repsol YPF, a Spanish energy company. Some Brazilians welcome the stepped-up U.S. interest. “It’s better for us,” says Fernando Henrique Cardoso, Brazil’s President from 1995 to 2003, “for the Americans not to retreat too much, to keep the balance.”

And from Reuters:

China will loom large over U.S. President Barack Obama’s visit to Latin America this week as he sends a message that Washington remains relevant to a region that owes much of its robust economic health in recent years to Chinese demand.

In both Brazil and Chile, the two South American countries that Obama will visit, China has recently overtaken the United States as the number-one trade partner.

Even in those countries where the United States is still the dominant partner, China is catching up fast.

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Post tags: Brazil, Latin America, south america, U.S. relations
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Only a few months ago, Brazil and China seemed destined to enjoy one of the defining alliances of the early 21st century — two fast-growing emerging market economies seeking ever-greater opportunities for business together and standing side by side on key global issues such as trade negotiations.

It’s not quite working out that way.

Rousseff’s regular meetings are just one sign of how she is steering Brazil toward a more confrontational stance with China. She is trying to address what she sees as an increasingly lopsided relationship while also bringing Brazil’s strategic alliances in line with her dream of turning it into a middle-class country by the end of the decade.

The core problem is a torrent of Chinese imports that has quintupled in size since 2005, with disastrous effects for Brazilian manufacturers and the well-paying, highly skilled jobs that Rousseff is so focused on creating.

While the weekly session of ministers and finance ministry officials is ostensibly about how to improve Brazil’s competitiveness in global trade, “it’s basically a China meeting,” said one high-level official who takes part.

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Post tags: Brazil, Latin America, latin america china's rise
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Americans tend to see China’s economic rise through the prism of the bilateral trade deficit and competition for manufacturing jobs. But the real story is that Chinese institutions are buying equity stakes and making loans to increase their influence in natural resources. And Latin America is the most important arena for China’s investments.

Some observers portray this as a threat in the U.S. “backyard.” The truth is that the developing trade between China and Latin American countries represents an opportunity—if the U.S. plays its cards right.

There are several reasons to be relatively sanguine about China’s increasing involvement in Latin America. Most obviously, the Chinese interest in the region is pragmatic rather than ideological. The goal is to further economic growth at home by opening new markets and guaranteeing a supply of necessary inputs.

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Clinton said President Barack Obama has had to take a new tack after his predecessor George W. Bush’s efforts to isolate such leaders only made them “more negative” toward Washington and receptive to other powers.

“I don’t think in today’s world … that it is in our interest to turn our back on countries in our own hemisphere,” Clinton told diplomats and other State Department staff.

She described the new world as “a multipolar world where we are competing for attention and relationships with at least the Russians, the Chinese, the Iranians,” adding such countries can soon fill the void.

“If you look at the gains, particularly in Latin America, that Iran is making, that China is making, it’s quite disturbing,” the chief US diplomat said.

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Post tags: Hillary Clinton, Latin America
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It is not simply a trip to groom a president-in-waiting or to strike more deals for natural resources, as is often the case with Africa.

China’s export markets in Europe and North America have shrunk substantially in the global financial crisis.

The government is desperate to open up new markets in the region of more than half a billion consumers and maintain market share for China’s export machines in 2009.

China is the third largest trading partner for Latin America.

Last month, it was reported that China had joined the Inter-American Development Bank, with a contribution of $350 million. From the Wall Street Journal:

China plans to help fund a number of initiatives to help Latin American countries cope with the global financial crisis and economic slowdown, including $125 million for the IDB’s special operations fund that lends to the poorest countries.

“Amidst the current financial crisis, it is of greater importance to strengthen comprehensive cooperation between China and Latin America,” said Zhou Wenzhong, China’s U.S. ambassador, at Monday’s signing ceremony.

IDB President Luis Alberto Moreno said China’s membership comes “at a critical moment for the world economy, when countries need to protect recent social and economic gains.”

Meanwhile a congressional hearing urged President Obama to refocus American attention on the region. From AFP:

Obama’s predecessor George W. Bush’s lack of attention to Latin America was partly blamed for the spread of Chavez’ influence in the region, and subcommittee chairman and Democrat Eliot Engel warned of further leftist encroachment unless US policy changed.

“If we create a vacuum, others will rush in, like Iran or China,” he said.

See also:
- “Mexico could be door for Chinese investment in Latin America” from Xinhua

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Post tags: Latin America, mexico
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One of the most interesting developments in China’s foreign policy in the last 5-10 years has been China’s increasing involvement in the developing world. China’s involvement has taken a number of forms, including direct financial aid, strengthened trade ties, and technology/arms transfers. Additionally, China has regularly hosted and attended annual meetings from a number of regions.  One of China’s most attractive features for developing countries is that it is known for providing development aid and infrastructure assistance without conditions or requirements, in direct opposition to many Western countries and organizations.  Furthermore, China strictly adheres to a non-interference policy, respecting international sovereignty and avoiding interference in a country’s internal affairs: something the West is not necessarily committed to.  The articles linked to below primarily show China’s involvement in Africa and Latin America.  As the articles describe, China has provided a wide-range of assistance, from funding for hospitals to trade agreements.

China’s Motivations: There are a number of reasons for China’s involvement in the developing world. One of the most important of those reasons is China’s access to natural resources, which are plentiful in many of the developing countries China supports.  China is anxious to secure alternative energy sources, as well as alternative markets for its products. Additionally, China reaches out to developing nations for security reasons: it both wants to solidify its periphery as well as isolate Taiwan on the international scene. Indeed, many of the countries that China has financially aided have withdrawn their official acknowledgment of Taiwan. Finally, China provides aid to developing countries in order to support a multipolar world and hedge against the United States. On a softer note, China sees itself as the “world’s largest developing country” and feels a kinship with other developing nations, though it is quickly (if it has not already) moving out of this category.

Soft Power: Developed by Joseph Nye, soft power is the concept of expanding one’s influence through non-military means.  Scholars and journalists have recently linked China’s involvement in the developing world with the concept of soft power, commenting with some concern that China may be making a conscious effort to supplant U.S. power through its financial support of developing nations.  While Chinese influence is certainly increasing in regions such as Latin America and Africa, it is unclear whether China is making a concerted effort to supplant the United States through the use of soft power.

China’s Relationship with Pariah States: Much of the criticism of China’s foreign policy has arisen from its support of pariah states.  China supports Zimbabwean president Robert Mugabe, the military junta in Burma, and has provided the government of Sudan with weapons.  As mentioned above, many consider these actions as China’s way of hedging against U.S. power. Though China has remained recalcitrant in its support of some pariah nations, it’s desire to be a respected member of the international system has led China to take a leadership role against other pariah states such as North Korea.

The World’s Response to China’s outreach: The West has become concerned with China’s involvement in the developing world for a number of reasons.  First, China’s practice of providing aid without obligations has made it difficult for the West to promote good governance and sustainable development with aid as a carrot.  Additionally, as noted above, China’s support for a number of pariah states makes it nearly impossible to isolate the states to create regime change.  Hopefully, China will increasingly prioritize its standing in the world and work to become a respectable member in the global community through more responsible lending practices.

• Dec 02 2008: China to Extend Major Financial Support to Nepal
• Dec 01 2008: China grants Sudan $3m for north-south unity
• Nov 30 2008: China Urges Practical Steps To Help Developing Countries In Confronting Crisis
• Nov 29 2008: China Helps Fight Cholera in Zimbabwe
• Nov 29 2008: China Concerned over Situation in DR Congo
• Nov 24 2008: China president in Greece for $1 billion port deal
• Nov 18 2008: China, Costa Rica to Launch Trade Talks
• Oct 01 2008: Salsa Fever Sweeps into China
• Sep 16 2008: China Urges Iran’s Cooperation with Nuclear Agency

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Post tags: 2008, Africa, Africa aid, foreign policy, Latin America
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Last week Chinese President Hu Jintao pledged that China will make a “concerted effort” to “establish a comprehensive cooperative partnership of equality, mutual benefit and common development” with Latin America, according to China’s Xinhua news agency. The Chinese president made his comments in Lima just before the 16th Asia-Pacific Economic Cooperation summit. Mr. Hu’s words — and other recent developments — warrant careful attention because they clearly signal a relationship that will expand greatly in the years ahead.

APEC was the last stop in Mr. Hu’s journey to the West, a 10-day trip which shows how much Beijing’s relations with the Western Hemisphere have changed from the “lie-low” strategy of Deng Xiaoping. This was Mr. Hu’s first trip to South America since November 2004, when he visited Brazil and Argentina en route to an APEC summit in Chile. That trip raised China’s profile in the region, but this latest trip, in a period of international financial crisis, confirmed China’s intention to play a more open, active, permanent and constructive role in the Americas, though some Latins have become doubtful or jaded.

The first-ever official policy paper on China and Latin America was released just before Mr. Hu’s trip. It outlines a range of programs in the region, including cooperation in science, technology and education, and political exchanges at all levels.

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In an address to Peru’s Congress, Hu made no mention of the United States and its regional dominance. But he made the case for China playing a bigger role across Latin America by combining its appetite for resources, investment potential and understanding of Third World concerns.

A global downturn may be sapping demand for Latin American goods, but China’s economy will keep growing, Hu assured the lawmakers.

“Development is the most pressing task for both China and Latin America,” Hu said. “In our cooperation we will take care of Latin America’s legitimate concerns and strive to realize mutually beneficial gains for all.”

See also:
* “China, Peru issue joint press communique on strategic partnership, FTA” from Xinhua
* “China Exporters May Gain From Trade Deal With Peru” from the Wall Street Journal
* “Chinese ‘Bill Gates’ booed by angry Peruvian textile workers” from AFP.

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Post tags: Latin America, Peru
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History might mark the meeting last weekend of the Group of 20 nations in Washington as formal anointment of China as a major world economic power. On the heel of that historic meeting, President Hu Jintao of China heads south to Latin America to mark another milestone in China’s growing power and influence.

While the principal purpose of the trip is to join 21 other leaders at the annual Asia-Pacific Economic Cooperation conference in Lima, Hu’s tour highlights China’s growing ties in the region. Since his last Latin American tour in 2004, China has burst onto the regional stage with a flurry of investments, trade, military exchanges and diplomacy.

Read also China deepens Latin America ties by James Painter.

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Post tags: David Shambaugh, international relations, Latin America
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China has seen its trade with Latin American nations climb from $13bn in 2000 to more than $100bn in 2007.

“My visit is aimed at increasing friendship and co-operation between our two nations, and working together with our Cuban comrades to build a promising future,” Mr Hu said in a statement. …

China, a modern-day economic powerhouse in a world of financial uncertainty, sees Cuba with its need for investment and political support as an important ally in its long-range plans to strengthen and expand its ties with the rest of Latin America, he adds.

After Cuba, Hu will head to Peru for the Apec (Asia-Pacific Economic Co-operation) summit in Lima. The AP’s Frank Bajak reports that China isn’t letting the global financial crisis get in the way of its ambitions in Latin America:

China’s trade with Latin America was $102 billion last year, but already in the first nine months of this year it reached $111 billion, Chile’s ambassador to Beijing, Fernando Reyes, told The Associated Press. That compares with U.S.-Latin American trade of $560 billion last year.

Hu’s government insists its interests are not just commercial. In its first policy paper on ties with the region, China’s foreign ministry suggested it might help Latin American countries reduce their debts. It also said it wants to help Latin American nations narrow the gap between rich and poor.

To that end, China last month bought into the Interamerican Development Bank with a very modest $350 million investment for social, anti-poverty related projects. That compares to Washington’s 30 percent stake in a fund that exceeds $100 billion.

The money may be small, but the symbolism is big: The United States isn’t the only world power Latin America can turn to for help.

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Post tags: foreign investment, Hu Jintao, Latin America
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