https://crsreports.congress.gov
Updated December 28, 2022
China’s Engagement with Latin America and the Caribbean
As the People’s Republic of China (PRC, or China) has
increased its engagement with Latin America and the
Caribbean (LAC) over the past 20 years, U.S.
policymakers, including in Congress, have raised questions
regarding potential implications for U.S. interests in the
region. China’s engagement with LAC has grown
significantly since 2001, particularly in terms of diplomatic
and economic ties. A succession of PRC leaders and
officials have visited LAC to court governments, reflecting
China’s global “soft power” efforts and “influence
operations” worldwide. Regional leaders and officials, in
turn, have frequently visited China. The PRC has signed
various bilateral partnership agreements with countries
throughout LAC, including “comprehensive strategic
partnerships” with Argentina, Brazil, Chile, Ecuador,
Mexico, Peru, and Venezuela.
Diplomacy
Beijing’s diplomatic overtures in LAC underpin China’s
economic activities. They also help institutionalize China’s
engagement in LAC and garner support in international
fora. Some analysts argue that the PRC’s activities in LAC
reflect a global strategy to reduce U.S. dominance, although
the activities do not aim to challenge the United States
directly or militarily. China’s diplomatic efforts include
being an observer at the Organization of American States, a
member of the Inter-American Development Bank and the
Caribbean Development Bank, and a participant in the Asia
Pacific Economic Cooperation forum. China has supplied
Coronavirus Disease 2019 vaccine doses to many LAC
countries, albeit largely through sales rather than donations;
most doses in the region have come from elsewhere.
Since 2015, China’s top leader Xi Jinping has participated
in three summits with leaders and foreign ministers of the
Community of Latin American and Caribbean States
(CELAC), a region-wide organization that excludes the
United States and Canada. Xi addressed the Third China-
CELAC Ministerial in December 2021 via video message.
The meetings have promulgated “cooperation plans”
covering politics, security, trade, investment, finance,
infrastructure, energy, resources, industry, agriculture,
science, and people-to-people exchanges. At the 2018
summit, China invited countries in LAC to participate in its
Belt and Road Initiative (BRI), which focuses on PRC-
backed infrastructure development around the world. To
date, 21 countries in LAC participate in the BRI; most
recently, Argentina joined in February 2022.
The PRC government’s second policy paper on LAC,
released in 2016, stated that China seeks to strengthen
cooperation on the basis of “equality and mutual benefit” in
several key areas, including exchanges and dialogues, trade
and investment, agriculture, energy, infrastructure,
manufacturing, and technological innovation. It noted that
China will “actively carry out military exchanges and
cooperation” with countries in LAC but emphasized that
China “does not target or exclude any third party.”
Another of Beijing’s apparent goals is to isolate Taiwan by
attempting to lure away LAC countries that maintain
diplomatic relations with Taiwan, which officially calls
itself the “Republic of China.” Currently, 8 countries in
LAC (out of 14 countries worldwide, including the Vatican)
recognize Taiwan; the remaining 25 in LAC recognize the
PRC. Panama, the Dominican Republic, and El Salvador
switched recognition to the PRC in 2017-2018, and
Nicaragua switched in December 2021. Honduran President
Xiomara Castro, inaugurated in January 2022, stated her
government would maintain relations with Taiwan for now
despite a campaign vow to establish relations with the PRC.
Economic Relations
China’s economic goals in LAC include securing access to
raw materials (e.g., oil, ores, minerals) and agricultural
goods (especially soybeans); establishing new markets for
Chinese goods, including high-value-added products; and
partnering with LAC firms to access and jointly develop
technology. China also has sought opportunities in Latin
America for its infrastructure firms. China’s projected
slower economic growth in the near term, however, may
result in weaker PRC demand for LAC exports and
decreased PRC capital flows to the region.
Total China-LAC trade was valued at $448 billion in 2021.
China’s imports from LAC amounted to $221 billion in
2021, consisting primarily of natural resources, including
ores (42%), soybeans (16%), mineral fuels and oils (10%),
meat (6%), and copper (5%). China’s exports to the region
in 2021 amounted to $227 billion, with major exports
including electrical machinery and equipment (21%),
machinery and mechanical appliances (15%), and motor
vehicles and parts (7%). China has become the top trading
partner of Brazil, Chile, Peru, and Uruguay and the second-
largest trading partner for many other countries. China has
free-trade agreements with Chile, Costa Rica, and Peru and,
in February 2022, launched talks with Ecuador, which
reportedly were almost complete as of December 2022.
According to the China Global Investment Tracker database
maintained by the nongovernmental organizations
American Enterprise Institute and the Heritage Foundation,
China’s investments in LAC from 2005 to mid-2022
amounted to $143 billion, with Brazil accounting for $64
billion (45%) and Peru $25 billion (17%). Energy projects
accounted for 59% of investments and metals/mining
accounted for 24%. The database also shows that PRC
construction projects in LAC from 2005 to mid-2022 were
