A Compelling Alternative
Suriname's debt renegotiation, new flights to Brazil & Mexico, and the PRC's special rep in Cuba & Panama. Plus, China's silence on Haiti and U.S.'s new Americas Act.
Welcome to Chaufa, a China-Western Hemisphere Newsletter by CPSI.
Today’s Edition covers March 4 to March 17.
The Top 5 Stories:
Suriname’s foreign minister said that his country has finally come to an agreement with China to restructure the country’s $483 million debt. The renegotiation will be officially signed during President Santokhi’s upcoming April visit to Beijing.
The China-Suriname debt renegotiations have been ongoing since at least this past fall, as at one point Suriname’s debt to the China Export-Import Bank represented 17% of the country’s GDP. They also take place after a broader restructuring and rescheduling of Suriname’s sovereign debt with other global lenders.
Air China will restart its twice-weekly Beijing-São Paulo (via Madrid) flight to Brazil that had been previously paused during the pandemic. China Southern Airlines also announced that it would restart twice-weekly direct flights from Shenzhen to Mexico City in mid-April as Chinese investment in the country reaches record highs.
Though this is a positive sign for China-LAC travel, several pre-pandemic direct and indirect flights remain to be restarted. Most notably, flights from Shanghai and Beijing to Mexico, as well as Panama’s and Cuba’s direct flights to the PRC, have still yet to get going again.
One of the tranches of the Argentina-China currency swap will reportedly expire at the end of June, meaning that Buenos Aires will have to reimburse a still-not-published quantity of the previously used yuan if the PRC does not agree to a deferral.
The news comes as Chinese contractor Gezhouba said that it would leave the two Chinese-financed Santa Cruz mega dams it had been working on. In turn, the company will lay off over 1,000 workers unless the Milei administration dedicates more state resources to the project.
However, some Chinese private sector engagement in Argentina continues — Ganfeng lithium announced that it would buy a 15% stake valued at $70 million of Lithium Americas Argentina Corp to help develop the Pastos Grandes lithium salt lake project.
U.S. Southern Command’s commander, Laura Richardson, claimed that China’s substantial commercial influence in Latin America and the Caribbean could create serious security risks for the United States. To combat this influence, she called for more security cooperation funds.
To “counter China’s growing control over global manufacturing and geopolitics,” U.S. legislators introduced the Americas Act, which would “create an ever-expanding and permanent trade partnership of Western Hemisphere countries.”
The PRC’s Special Representative on Latin American Affairs Qiu Xiaoqi met with Panama’s Vice Foreign Minister from March 5-6 to discuss bilateral and regional cooperation, while he then traveled to Cuba on March 6 to meet with the foreign minister. (Panama - FMPRC) (Cuba – FMPRC)
The trip comes after Qiu traveled to St. Vincent and the Grenadines to represent China at the CELAC summit on March 1. (FMPRC)
Core Brief
China goes quiet on Haiti
Despite the escalation in Haiti’s political crisis with Ariel Henry’s resignation, China’s voice has been conspicuously absent for the past two weeks.
Since Haiti has formally recognized the Republic of China over the PRC since 1956, China’s reticence to speak on the issue is not too surprising. Though China has sometimes sought to leverage Haiti’s political crisis to flip Port-au-Prince’s recognition (for example, in 2021 its UN representative held up a UN resolution on Haiti for political advantage), historically its limited focus on Haiti has been on discussions at the UN and some aid efforts.
Notably, the PRC supported previous UN peacekeeping missions and donated supplies after natural disasters. Haiti is also one of the only countries with informal diplomatic relations with China, with a PRC Commercial Development Office in Port-au-Prince and a Haitian Bureau of Commerce and Development in Beijing.
Before recent events, China’s UN Representative staked out his country’s limited political position on the crisis. Per a January statement, the PRC has sought a “comprehensive”, rather than piecemeal, solution along three main pillars: supporting international and regional efforts to find a political solution, stabilizing Haiti’s security situation (which China has partially blamed the United States for giving its firearms industry), and providing additional aid to mitigate the humanitarian crisis. And while the PRC also “appreciated” Kenya’s willingness to lead a multinational security support mission to the country, it declined to endorse the UN Security Council resolution on the mission last fall because it argued that “any external support can hardly have any lasting effects.”
Having staked out this position, China’s foreign ministry has publicly gone quiet over the past few weeks. Despite having a press conference roughly every day, China’s foreign ministry spokesman has not mentioned Haiti by name over the past two weeks. The foreign ministry’s most recent mention of the country on its website is from January, and the Chinese and French versions of Beijing’s unofficial mission in Port-au-Prince last released new statements in 2023 and 2016, respectively. Additionally, China was not one of the international development partners cited in the recent CARICOM meetings on the crisis.
All that said, Taiwan has also been relatively absent in the ongoing crisis. Like many other countries, the ROC has been providing Haiti with aid for decades. For example, over the past few years, it has donated goods like rice, fishing equipment, medical equipment, and bulletproof vests for the national police. But as noted below, Taiwan’s foreign ministry public commentary has mostly been focused on aiding Taiwanese citizens rather than publicly engaging in diplomatic efforts around the crisis.
The Americas Act: What it does, and how it will (and won’t) matter
On March 6, a bipartisan coalition of U.S. senators and representatives introduced the “Americas Act,” a bill that had been under discussion since last year. Though the legislation spans a diverse array of issues in U.S.-LAC engagement, including trade, investment, people-to-people ties, and immigration policy, the bill’s unifying factor is its desire to “counter China’s growing geopolitical and economic power in the Western Hemisphere.”
To “combat China’s Belt and Road initiative (BRI),” as well as Beijing’s broader social and political influence, the bill proposes new U.S. initiatives that both implicitly aim to reduce the PRC’s importance in the Americas and explicitly target China’s regional and global reach.
Implicitly competing with Chinese trade influence in the region, the bill formalizes the Biden Administration’s Americas Partnership for Economic Prosperity (APEP), with new U.S. government bureaucracies and a partnership secretariat to support the policy. It also establishes both $70 billion in new loans and grants to support re-shoring and an expansion of the Caribbean Basin Trade Partnership to Uruguay and Ecuador to provide them new market access.
To induce new financing and investments into the region to compete with China’s BRI, the bill creates a new Build Americas Unit and an Americas Partnership Enterprise fund at the U.S. International Development Finance Corporation. Supporting these efforts, it seeks to increase the DFC’s total borrowing authority from $60 billion to $90 billion. The legislation also establishes a new Commerce Department Americas program on strategic supply chains and transformational energy investments.
A few sections are also specifically targeted at combatting Chinese (and other authoritarian actors’) influence in the region. The nearshoring provisions specifically state that they intend to poach business from China, while the bill’s textile manufacturing nearshoring measures explain that these policies would reduce U.S. dependence on “slave-based Chinese textile and apparel labor.” In the people-to-people ties section, though the bill’s authors do not identify Chinese state media as a competitor, it establishes a “Radio Free Americas” (mimicking Radio Free Europe or Radio Free Asia) whose mission is explicitly tied to combatting media messages from authoritarian states like Russia and Cuba.
How likely are these plans likely to help combat Chinese influence in the region? More trade, investment, and immigration facilitation measures could certainly be valuable to marginally boosting regional economic growth and improving individuals’ lives. If well-designed and specifically targeted, these funds and measures could be used to limit Chinese influence in narrow sectors of concern, such as Huawei’s role in local 5G networks. This is why certain parts of the bill are promising – for example, by focusing on the reshoring of textiles, U.S. policymakers can both achieve regional development goals while also accomplishing discrete policy goals around reducing forced labor in the textile and apparel supply chain.
However, this bill won’t be anything close to a death blow to Chinese influence or be a serious competition to the BRI. Even if the United States were to go well beyond the measures proposed in this bill by fully opening its markets to LAC businesses or spending state funds willy-nilly on regional infrastructure projects, Chinese importers, financiers, and construction firms would still play a key role across the Americas. China’s economy is simply too large, too interconnected, and too advanced in key technological areas like public transportation design or clean energy to not be a key player in LAC’s development for years to come.
The Roundup
Politics and Society
The Chinese People's Association for Peace and Disarmament sent a delegation to Nicaragua to discuss “learn from the experience of the People's Republic of China and strengthen the ties of cooperation for world peace” with the president, foreign ministry, and national assembly.
Meanwhile, the PRC embassy in Managua announced a new donation of musical instruments to the country’s 46 symphony orchestras.
Panama now has its second-ever PRC ambassador to Panama City, with Xu Xueyuan, a former Minister in the Chinese Embassy in Washington, landing in the country.
Xu’s only notable prior experience in the LAC region was a three-year stint in Trinidad and Tobago early in her career.
Dominica’s Prime Minister gave a speech commemorating 20 years of diplomatic ties with Beijing, especially noting the cultural, economic, and social aspects of the bilateral relationship.
The speech came as the PRC’s ambassador to Dominica announced his upcoming departure and local officials broke ground on the Chinese-financed Thibaud Primary School reconstruction.
Investment, infrastructure, and finance
China’s ambassador to Ottawa promised that the country would continue to invest in Canada’s critical mineral sector despite what he characterized as PM Trudeau’s “unfortunate” crackdown on foreign investment.
The comments come as both the Canadian government considers more restrictions on Chinese investments and China’s Carbon ONE New Energy Group signed a $12.5 million investment agreement with Canadian graphite miner SRG Mining.
The Honduran National Port Company’s manager said that the $240 million expansion of the Henecán port of San Lorenzo, which was originally to be financed by China Ex-Im Bank and built by China Harbour Engineering Company (CHEC), had been canceled “for geopolitical reasons.”
New Chinese investments continue apace in Mexico, as most recently the high-precision aluminum alloy castings company IKD announced a new $178 million investment in Guanajuato that is expected to support 1,000 jobs, while Sonora Governor Durazo Montaño met with a group of Chinese bankers to discuss possible financial services cooperation.
Perennially controversial Chinese mining company MMG plans to invest an additional $400 million in its Las Bambas copper mine in Peru.
The Costa Rican National Road Council continued to be critical of China Harbour Engineering Company (CHEC) for its construction of Route 32, this time urging greater oversight of CHEC’s subcontractor policies.
A consortium led by China Communications Construction Company (CCCC) and China Harbour Engineering Company (CHEC) started construction on the 3.5km, $1.42 billion, fourth bridge over the Panama Canal.
Trade and Technology
The Financial Times reported on how Brazil has launched numerous anti-dumping investigations against Chinese industrial products “ranging from metal sheets and pre-painted steel to chemicals and tires” over the last six months.
This report comes just weeks after the PRC lifted anti-dumping duties on Brazilian chicken that had been imposed in 2019.
The Ecuadorian trade ministry announced that the country’s FTA with China would officially go into effect on May 1.
Executives from Alba China visited Honduras to negotiate new prices for Honduran shrimp exports to the PRC, although the company appears to be offering only 70% of what Taiwanese importers had been previously paying the Honduran fishermen.
After three years of reviews, the Chinese General Customs Administration (GCA) approved the first Panamanian pork processing plant to export to the PRC, while Colombian pork, lemons, and shrimp were also approved by the GCA after a bilateral meeting with Colombia’s agriculture ministry.
The Chinese Medical Brigade donated $100,000 in HPV and cervical cancer screening equipment to Guyana’s Georgetown Public Hospital Corporation.
Argentina’s Senate overwhelmingly ratified a double taxation agreement with China that had originally been signed back in 2018. The agreement is now pending in the Chamber of Deputies. (Xinhua)
Taiwan
Taiwan’s Ministry of Foreign Affairs proposed a slight decrease in its Latin America and Caribbean budget, from $156.8 million to $154.1 million, though Taiwanese lawmakers questioned why the budget wasn’t reduced further given the recent loss of Honduras as a diplomatic partner.
Taiwan’s foreign ministry also recently claimed that neither President Tsai nor Vice President Lai had any plans to visit the Caribbean soon.
After Guatemala received a Taiwanese business delegation, the Guatemalan Clothing and Textiles Association (Vestex) and the Taiwan Textile Federation (TTF) signed an agreement to further promote bilateral trade, while the two countries’ governments agreed to strengthen bamboo cultivation cooperation.
As the crisis in Haiti continues to deteriorate, Taiwan’s foreign ministry said that it had no plans to evacuate Taiwanese citizens from the country nor close its embassy.
The ROC donated a batch of medical equipment to St. Lucia’s Ministry of Health and Ministry of Equity, following a similar donation last spring.
A delegation led by Paraguay’s ICT minister traveled to Taiwan this week to discuss economic, technology, education, and cybersecurity issues, while Paraguay’s foreign minister reiterated his country’s commitment to Taiwan.
Society and Culture
The Association of Women Entrepreneurs of the District of Haidian (Beijing) signed an MOU with Chile’s Empowerment Business organization on economically empowering women “through seminars, mutual visits, project presentation and exchanges of business visions.”
The New York Times ran a story on Chinese migrants making their way through South and Central America to live in Queens.
Analysis and Opinion
The Wilson Center hosted an event on Igor Patrick’s new book, Hearts & Minds, Votes & Contracts: China's State Media in Latin America. The book reports on how Chinese media actors “form alliances with local media to disseminate Beijing’s narratives, conceal the identities of Chinese state journalists who generate social media content targeted at Latino audiences, and limit negative coverage of China and place positive stories written in China.”
Connor Pfeiffer argued in the Wall Street Journal that “Beijing’s heavy state investment in its EV industry could enable Chinese companies to exploit gaps in the current [USMCA] rules,” allowing Chinese EV companies to gain an advantage by assembling cars in Mexico.
Writing for the Wilson Center, Margaret Myers put out a new explainer on how “China’s educational partnerships in the region–including through institutional arrangements, scholarship programs, research support, company initiatives, and other platforms–number in the thousands” and extend far beyond the normally-studied Confucius Institutes.
Dialogo Americas published the third part of a report by Pablo Baisotti on China’s public relations strategy in Latin America and the Caribbean, suggesting that “China has flooded the continent with exchange scholarships to attract and co-opt Latin American students, professors, journalists, and politicians” and providing policy recommendations.
Both Newsday and Loop News analyzed how Chinese Foreign Minister Wang Yi’s news conference could affect China-Caribbean ties, noting that he focused on expanding trade, investment, and the BRI; enhancing collaboration with the Global South; building new AI capacity in developing countries; and ease carbon intensity to address climate change.
Dialogo Americas put out two explainers this week on Chinese-Southern Cone relations: one by Javier Lewkowicz on what’s next for Argentina’s increasingly tense ties with Beijing, and another by John Bartlett on a history of Sino-Chilean relations.
That’s it for now, see you again in two weeks!
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