While U.S. pays little attention to Latin America, China has moved in

The pending development of a $3 billion seaport in Peru will grant China direct access to the South American trade market and will be the first China-controlled port in South America. This and other proposed port development projects illustrate Beijing’s ambitions to strengthen its footprint and influence in diverse regions around the world. The U. S. must increase economic engagement in Latin America to offer the region competitive alternatives for its development. For several decades, policymakers in Washington have paid minimal attention to Latin America. Underinvestment in the region by the U.S. has created an opportunity for the People’s Republic of China, which has stepped in with offers of significant commercial and financial investment for Latin American countries, though not necessarily without strings attached.

Trade between China and Latin America has increased from $12 billion to $315 billion between 2000 and 2020. The World Economic Forum estimates that trade value could more than double to $700 billion by 2035. Similarly, since 2005, Chinese investments in Latin American and Caribbean countries exceeded $155 billion and targeted several vital economic sectors, including banking and energy, according to the American Enterprise Institute’s China Global Investment Tracker. Currently, 22 countries in Latin America and the Caribbean have signed a Memorandum of Understanding with Beijing that ratifies their participation in China’s Belt and Road Initiative. Central to Beijing’s economic offensive are state-owned and state-linked private companies and financial institutions that act as the glue between China and the region. Contracts signed between Chinese and governments in Latin America are often completed without external oversight and with obligations not to disclose any details through confidentiality clauses.