China and Latin America in Transition

This chapter examines the trade and economic relations between the People’s Republic of China (PRC) and Latin America and the Caribbean (LAC), which have been expanding exponentially since the dawn of the new millennium. China’s economic engagement is a key driver of the commodity boom in the first decade of the twenty-first century, because China imported massive amounts of raw materials from Latin America, which in turn boosted the fast economic growth in the region. Latin American officials, pundits, and journalists developed a keen interest to “rediscover” China and its growing impact on the transformation of the global economy and on the Western Hemisphere. A new wave of China’s presence in LAC has been ushered in since Chinese President Xi Jinping inaugurated his position in 2013.

This chapter proposes an initial reading of the logic of China’s evolving narrative as a global power. The piece attempts to understand some of the fundamental elements that frame China’s attempts at justifying its strategy to extend its global reach. While recognizing the speculative nature of this exercise, we also acknowledge the demand to engage in a dialogue that goes beyond explanations centered on China’s thirst for natural resources, unbalanced trade patterns, and other familiar themes that, although important, are not sufficient to fully comprehend China’s ascension to global status. An additional aspect of this intellectual task is to examine China’s emerging narrative from a perspective other than that of the United States. The deepening of China’s relationship with Latin America offers an excellent opportunity to examine this theme from a new standpoint.

Maintaining good relations with the developed countries has been one of the priorities of China’s foreign policies. It does not mean that developing countries are not important for China. As a matter of fact, the developing world, including Latin America, constitutes the foundation of China’s foreign policies since the People’s Republic of China was founded in 1949. The new leadership has maintained the general principle of China’s foreign policy that was implemented by Xi Jinping’s two predecessors, Jiang Zemin and Hu Jintao. Given the fact that the world is always changing, however, some fine-tuning adjustments are necessary.

It is essential to analyze the development of China’s relations with Latin America, particularly during the most recent period, where they have grown in all aspects, including trade. The main objective of this chapter is to analyze the recent evolution of Latin American and Chinese relations, after the economic growth slowdown of the Chinese economy recorded since 2011, as well as the obligatory search for strategies that should be implemented in the region to decrease adverse effects arising from the growing link it had with China over the past two decades. The chapter is structured as follows. The first part analyzes the characteristics of the Asia-Pacific region, representing the so-called Asian model of development, which is essential to understand the importance of China in the region and subsequently in the world. The second section highlights the importance of China in the global economy, followed by a section that deepens the study of China’s relations with Latin America. Finally, a brief concluding section highlights the main findings of the research.

Latin America belongs to one of the most emerging regions in the world. It plays a crucial part in China’s overall diplomacy in this new era, especially concerning the emerging markets and developing countries. We have reasons to believe that the strategic importance of Latin America in the overall layout of China’s diplomacy will become more prominent within the foreseeable future.

Throughout the history of Latin America and the Caribbean (LAC), the issue of integration has been an ever-present aspect of the political and economic development of the region. Undoubtedly, extraregional actors have played an important role in shaping the schemes of integration in Latin America, which has served as the scenario for several instances of hegemonic challenges in detriment to the cohesion of the region. The historical trajectory of 1 America demonstrates that it has always been a direct target of the vicissitudes of international politics. In the twenty-first century, Chinese presence in the region has been perceived as a hegemonic challenge; however, the unique features of China’s insertion in the international community determine the unlikeliness of such perceptions. Throughout the last fifteen years, the China-Latin American relationship has been marked by a steady implementation of policies that have created a basic structure for the development of this dynamic. From bilateralism to multilateralism, from complementarity to cooperation, China in Latin America has expounded the strengths and weaknesses of both actors’ asymmetrical relationship.

This chapter provides some insights on the analysis of China’s economic growth and the significance of Latin American markets for China. The macroeconomic data on Chinese exports and its GDP, as well as the annual economic growth rate, has already surpassed the United States and the main economic zones of Europe. But can such economic growth be based on a sustainable model? The chapter attempts to go beyond the traditional view that Latin America constitutes the backyard of China to locate manufactures and to import raw materials and natural resources. The author presents an analysis outlining the concept of multipolarity, or polycentric world economic areas that emphasize the current process of globalization, market integration, and multilevel international relations based on economic and political links, such as the polipolystic markets of China and Latin America.

Based on the increasing presence of China in Latin America and the Caribbean (LAC), this chapter focuses on the regional experience of LAC with China and the socioeconomic structures that have emerged as a result of this relationship since 2000. The goal of this chapter is to analyze the current socioeconomic structures, particularly in trade and investments, between LAC and China, as well as to provide a group of policy suggestions for this future dialogue. The first part of the chapter reviews the main structures in trade and investments that have emerged since 2000. The second section focuses on the causes, and particularly on the main results of the First Ministerial Meeting of the China-CELAC (Community of Latin American and Caribbean States) Cooperation Forum in 2015. The third and last part of the chapter reflects on a group of policy proposals that should be integrated into the discussion between LAC and China, also in CELAC.

With only 9 percent of the world’s arable land and a diminishing base of agricultural labor, China is exploring new strategies for producing and importing high-protein urban staples. Acquisition of foreign agriculture products is therefore important to the viability of the Chinese government’s vision of national economic development. The chapter examines questions and concerns that have become pertinent to China’s agriculture relations with Latin America: What domestic pressures are driving the Chinese government to deepen trade and investment with the region? How can China formulate reliable South-South relationships that offer partner countries more equitable outcomes than previous colonial and postcolonial experiences? How do Latin American suspicions of Chinese state-owned enterprises (SOEs) reinforce perceptions of imperiled national sovereignty? We find that the Chinese government has become acutely aware of the need to address Latin American concerns about its impact in the agriculture sector. To do so, it is taking measures ranging from approvals for a wider range of Latin American food imports to commitments to invest in value-adding sectors of the region’s agriculture production chains.

The general question explored in this chapter deals with the implications of intellectual property provisions of the Trans-Pacific Partnership (TPP) on Mexico and China’s business interests and economic relations. We show in this chapter that Mexico will follow the TPP’s intellectual property rights (IPR) provisions set by the United States. China, because of its economic might has more options to follow, even though a close association with the United States still remains one of its best strategies. In the first part of this chapter, we explore the guiding principles that motivate the main negotiator of the treaty, the country that intends to write the rules related to IPR, that is, the United States. In the second part, we look at Mexico’s and China’s positions in this regard. In the third part, we highlight points of convergence and divergence between both countries in their respective IPR policies. In the conclusion, we draw some implications in terms of business and policy in the perspective of TPP’s IPR provisions for Mexico and China.

The Economic Commission for Latin America and the Caribbean (ECLAC) drew up a document that presents the context in which commercial relations between China and Latin America and the Caribbean (LAC) are developing. The challenge for both regions is not to repeat the story that so many developing countries have suffered participating as peripheral countries compared with those considered as the most industrialized in the world. Real and virtual globalization have contributed toward the spreading of a fundamental vision that proposes there is only one economic policy possible: to satisfy the expectation of those who make the decisions in the global scenario. Any attempt to follow alternative strategies will lead to unrest and the marginalization of the world economy. This “virtual globalization” is where developing countries suffer from the influence of demands for profit by the economic agents linked to yields obtained by the financial sector. This stage, far from being exempt from forms of intervention agreed to previously, also marks a disinterest toward the people of developing nations.

As rising powers, both China and Brazil have gained growing economic and political influence in world politics over the past decades. Meanwhile, Brazil is China’s tenth biggest trading partner, and the largest in Latin America. Closer economic ties have led to expanded political cooperation between the two countries, with their leaderships meeting more frequently on both bilateral and multilateral occasions. But the present reality is that difficulties, such as language barriers and geographic distance, are obstructing cultural understanding between the Chinese and Brazilians. In order to fill this gap, this chapter sets up an inquiry into the cultural aspect of the Sino-Brazilian relationship. It suggests a systematic analysis that adopts Hofstede’s five cultural dimensions to compare the cultural similarities and differences between Brazil and China. The logic of culture holds considerable strength in characterizing the bilateral relations of the two states. A better understanding of these cultural factors can help us “seek common ground while reserving differences” and thus is of great importance to deepening the comprehensive strategic partnership between China and Brazil.

It is widely admitted that corporate social responsibility (CSR) can create a positive corporate image by reducing conflicts over environmental and social issues. To achieve sound outcome of CSR, especially in environmental protection and philanthropy, a company needs to interact proactively with various stakeholders among whom nongovernmental organizations (NGOs) remain one of the most active in promoting CSR. NGOs, both advocacy and operational ones, play the pressuring and cooperative roles, respectively, in urging or working in coordination with companies to implement their CSR. Thus, knowing how to communicate with NGOs becomes significant for a company to secure its positive public image in overseas areas. Based on the introduction of Ecuadorian advocacy NGOs, this chapter examines Ecuadorian NGOs interaction with key Chinese enterprises in Ecuador. After summarizing the problems that China faces in improving the CSR of its overseas enterprises, suggestions are made to Chinese enterprises and financial institutions backing China’s outbound foreign direct investment in Ecuador in recent years.