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China Looks To Invest Further In Latin America


It's MORNING EDITION from NPR News. I'm Steve Inskeep.


And I'm Renee Montagne. Since President Obama came to office, one of his major foreign policy goals has been a pivot to Asia. Recently, China has turned its attention to the Americas. President Xi Jinping kicked off a four-nation tour of Latin America's emerging economies this week in Brazil. To get a deeper sense of China's growing presence in the region, we reached NPR's Beijing correspondent Anthony Kuhn and our Latin America correspondent Lourdes Garcia-Navarro. Welcome to both.

ANTHONY KUHN, BYLINE: Good morning, Renee.


MONTAGNE: And Lourdes, starting with you in Brazil, this is a pretty extensive trip by President Xi. Can he expect a warm reception?

GARCIA-NAVARRO: Well, he's going to Argentina, Cuba, Venezuela, as well as Brazil. He's spending six days lingering in Latin America. He's not only visiting those countries. He's also attending, here in Brazil, a Community of Latin American and Caribbean States meeting, where the foreign ministers or senior leaders will also be here from the wider region. So this is a big tour. And the short answer is yes, he will be getting a very warm reception. But the reason he's very welcome is investment. China has money to spend. The U.S., Europe, have not been showing largesse because of their own economic problems. The countries he is visiting, Argentina, Venezuela, Cuba, are countries that are locked out of the international markets because of the troubles with their economies. Brazil is seeing its economy flat-line. It also wants foreign investment. It wants Chinese companies to bid on refurbishing its infrastructure, for example. China is Brazil's biggest trading partner, and it would like to see that relationship deepened.

MONTAGNE: And Anthony Kuhn, speaking to you in Beijing, we just heard why some of these Latin American countries might want a close relationship with China. What about China? What matters most to it?

KUHN: Well, China is looking for several things, Renee. It wants resources and commodities for its economy, such as oil and grain. It's looking for markets for its manufactured products, and it wants political influence to match its economic clout. And China has pledged about $75 billion in loans to Latin American countries in the past decade, out-financing the World Bank and other big lenders. And it might appear that China's in the driver's seat because it's doing all this lending. In fact, there's a high risk because these countries are not so credit-worthy. So China has to manage this risk. And it's also faced a lot of criticism in countries in Southeast Asia and Africa, which say that China is extracting their resources and then selling them back the manufactured products. And they feel like they're being exploited, so they don't want that to happen in Latin America.

MONTAGNE: Well, Lourdes, we have seen in Africa and Southeast Asia that at first people welcomed China, and continue to do so, but also grow to resent it.

GARCIA-NAVARRO: Yeah, and I think that's true here too. As one analyst put it to me, the honeymoon period is over between Latin America and China in some respects. The trade imbalance between the region and China is growing. There are also human rights concerns about the labor practices of Chinese companies in the region.

MONTAGNE: Well, OK. Now, while he is in Brazil, President Xi attended a summit of the group of nations known as BRICS; that would be Brazil, Russia, India, China and South Africa. And you have to wonder, given that China is such an economic giant, if these countries feel like junior partners?

GARCIA-NAVARRO: Well, anyone who ever talks about the BRICS, they always speak about the dominance of China. Its economy dwarfs all the others. But they also talk about how all these countries have such divergent interests. Some are energy importers. Some are energy exporters. Some are democracies - others, not so much. So you look at Brazil, for example, and its relationship to China - there's that massive trade imbalance. Brazil wants to stop just being a source of raw materials, of soy beans and iron ore, which is what 80 percent of its trade is to China. It wants to have its manufacturing sector, for example, have access to China's growing middle class. China has not been helpful in that regard so far.

MONTAGNE: And Anthony Kuhn there in Beijing, the BRICS countries just announced the founding of a new development bank. So what is this all about for China, in particular - unhappiness with how the West has dominated international institutions like the IMF and the World Bank?

KUHN: Well, I think it's not hard to see that there's clearly a geostrategic angle here. And that is this sort of zero-sum logic where you try to wield clout in your neighbor's backyard and try to prevent him from doing the same thing in yours. Now, China would no more admit that it's doing this then, say, the U.S. would admit that its pivot to Asia is intended to contain China. But you hear this sort of rhetoric from Chinese leaders. In May, Xi Jinping said at a conference that, at the end of the day, Asian countries and Asian people have to provide for their own security and solve their own problems. So that thinking is there.

MONTAGNE: That's NPR's Beijing correspondent Anthony Kuhn and Latin America correspondent Lourdes Garcia-Navarro. Thank you both very much.

GARCIA-NAVARRO: You're welcome, Renee.

KUHN: My pleasure, Renee. Transcript provided by NPR, Copyright NPR.