America faces China in its 'backyard'

Fading influence

As mentioned, if nothing changes, at noon on January 20, 2021, President-elect Joe Biden will be sworn in, officially becoming the next owner of the White House - the symbol of American power. One of the issues that will give Mr. Biden and his team a headache when dealing with the legacy of the Trump administration is that the mineral-rich region of Latin America, which has long been considered the "backyard" of the United States, is now witnessing Beijing's "pincers" tightening its siege on many large swathes of land.

The new administration of Mr. Joe Biden will face a rising China in its "home turf" of Latin America. Photo: AP

According to a Reuters investigation, which included numerous interviews with current and former officials and advisers, and a careful analysis of trade data, it concluded that under Trump,China has surpassed the USin terms of power and influence across much of Latin America.

That certainly poses a challenge for President-elect Biden, who has pledged torestore global leadershipWashington after years of Trump’s “America First” policies, and asserted that the decline of US influence in Latin America is a threat to national security. In March, Americas Quarterly quoted Biden as saying: “They should take note that Trump’s incompetence and neglect in Latin America and the Caribbean will end on day one of my administration.” His team declined to comment for this story. But it is probably clear that such a commitment will not be easy to fulfill, let alone overnight.

Since 2018, excluding Mexico, China has replaced the United States as Latin America's largest trading partner, consuming copper mined from the Andes, Argentine grain and Brazilian meat.

Beijing has also ramped up investment and poured low-interest loans into the region, backing energy projects, solar farms, dams, ports, railways and highways.

The US and China are competing for influence in Latin America. Photo: BBC

“Mr. Trump doesn't care at all”

Officials in the region warn that, as a major economic and diplomatic partner for many countries, China will not be an easy name to dismiss. Billions of dollars from China are seen as a lifeline for emerging economies, large public debt, not to mention the increased demand for capital due to the negative impact ofCovid-19 pandemic.

China is currently the number 1 trading partner with Brazil, Chile, Peru, Uruguay and many other countries, far surpassing the US in terms of trade turnover with Argentina. Excluding Mexico, China's trade with Latin America has surpassed the US since 2018 and widened the gap in 2019 to more than 223 billion USD compared to the US's trade turnover of 198 billion USD (according to analysis of trade data from the United Nations International Trade Statistics Database). And if Mexico - the US's number 1 global trading partner last year - is taken into account, the US still has a higher overall turnover with Latin America than China.

Throughout its tenure, the Trump administration has been seen by some countries in the region as doing little more than warning its Latin American partners.don't be too friendly with China, especially through low-interest financing or technology partnerships as the race for 5G dominance heats up.

Mark Feierstein, an adviser to former President Barack Obama, said Trump’s lack of engagement and abandonment of the Trans-Pacific Partnership trade bloc created a vacuum that China stepped in to fill—and that’s exactly what Biden would seek to reverse. “What Trump has done so far is make China look like a better partner. That’s all going to change,” said Feierstein, now a senior adviser at the Albright Stonebridge Group.

A Chinese naval hospital ship docked in Venezuela and provided free medical examinations and treatment (2018). Photo: AFP

Strategic advantage

Many analysts and former advisers in previous administrations assert that the White House under the new Democratic leader Biden is likely to give higher priority to the Latin American region. However, in parallel, the White House will have to "juggle" the story of post-pandemic recovery and reset relations in Europe and Asia.

Janet Napolitano, former Secretary of Homeland Security under Obama, said her experience working with Mr. Biden led her to judge that he saw a “strategic advantage for the United States in having strong relationships across Central and South Asia.”

According to experts, Mr. Biden is expected to continue issuing similar warnings tocloseness to China, but will likely aim to win back the hearts and minds of its neighbors, with offers of more financial incentives and a resumption of humanitarian aid that Mr. Trump cut short. “His administration will recognize the dependence in South America on the Chinese market and try to offer assistance in a much more robust and generous way,” said Benjamin Gedan, a former National Security Council official under Obama.

A farm in Buenos Aires, Argentina. China is the largest buyer of Argentine soybeans. Photo: Reuters

Economic diplomacy

China has seized the opportunity during the pandemic to deepen ties in Latin America, sending medical supplies including ventilators and masks to respond to Covid-19. In Argentina, the government has announced several new or expanded initiatives with China in recent months, including vaccine trials, space cooperation, a Chinese military studies course for students at the South American country’s defense college, and discussions on a possible state visit to China by President Alberto Fernandez and Argentina’s participation in Beijing’s Belt and Road Initiative.

“China’s economic diplomacy, whether through trade or finance, opens many doors,” argues Margaret Myers, director of the China and Latin America program at the Inter-American Dialogue, citing the $2.4 trillion loan package from the Export-Import Bank of China to Ecuador this year. The US appeared to have tried to change course in the months leading up to the election, launching a series of regional initiatives in an effort to compete with China, but many considered it too late.

Ultimately, the pandemic has posed many risks for the United States, pushing some countries in the Latin American region closer to partners like China. Acknowledging that Covid-19 is affecting economic decision-making and is affecting the psychology of many countries, Francis Fannon, US Assistant Secretary of State for Energy Resources, still sent a message: “We want to encourage countries to continue on the reform path they have chosen. The United States is the ideal partner, has been and always will be.”