LAC: Between China and the US

Surely we must celebrate the rapprochement between the U.S. and Cuba and the renewed interest of the Obama administration in the region.

However, such a position may have more to do with countering the decisive action by China to establish a presence in Latin America and the Caribbean (LAC) than having a genuine and disinterested desire to “be part of the region,” or even preparing the area for the next Democratic candidate for president of the United States.

It is true that when Barack Obama was first elected president in 2008, he announced in his inaugural speech that he would move closer to Cuba and would try to close Guantánamo as part of a strategy designed for a new partnership with Latin America. That was his position when he was still a senator.

But the fact that China is robustly entering in the economies of the countries in the region is a decisive factor in the recent announcements by the United States, not only during the Summit of the Americas, but in other scenarios too. An example is the meeting of the Caribbean Community (CARICOM) held in Jamaica, where it presented an initiative on energy security to facilitate independence from Venezuelan oil production, or even when the U.S. decided to send a special envoy to the dialogue process that the government of President Santos is undertaking with FARC guerrillas in Havana.

The $250 billion that China plans to invest over the next 10 years in the region as indicated by the president of that nation, Xi Jinping, clearly is a threat to the position of the U.S. from the standpoint of trade in Latin America and the Caribbean. If this investment happens, China will replace the European Union as the second trading partner in the region by 2016, according to a study conducted by the United Nations. Not to mention the canal in Nicaragua that the Asian giant is funding, which clearly would compete with the Panama Canal and would be essential for China’s growth in world trade.

Today, for Brazil, Chile and Peru, China is the largest trading partner, while for Mexico, Argentina and Venezuela, it is the second. China has become a major source of funding for infrastructure development for Ecuador and Venezuela through loans of millions of dollars. All this has happened in part because of the neglect by the United States of Latin America and the Caribbean in recent years and what some call “the anti-Yankee policies” driven by nations friendly to the so-called “socialism of the 21st century.”

This scenario should lead the region to ask itself how to take advantage, on the one hand, of the huge market China offers for Latin American products, and on the other, the possibility of receiving the attention of one of the few economies that has positive indicators.

For the first time in their independent history, Latin American and Caribbean nations should concentrate their efforts and think as a region to figure out how to take advantage of the situation in order to: reintegrate Cuba into the region and the world; save the Venezuelans from the yoke of an authoritarian and dictatorial regime, restore its democracy and economy; and promote the integration processes that maintains the growth rates of previous years. They also need to ensure that this growth helps overcome the problems of poverty and social inequality — as Pope Francis emphasized in his recent letter to the heads of Latin American and Caribbean states.