Latin
America drifts East -- Evo Morales stakes Bolivia's future on
China
Pacific
News Service
BUENOS
AIRES
Petroleumworld.com
02 21 06
Evo Morales, a former coca farmer and Aymara Indian, is hoping
Chinese capital will help him develop Bolivia's natural gas resources,
which he has vowed to exploit for the benefit of the country's
poor, indigenous majority. In one of his first actions as Bolivia's
president-elect, Morales skipped the United States and scheduled
a two-day visit to Beijing.
To Latin American
analysts, Morales's choice of China as he angles for investment
is the latest evidence of a trend: The region, once firmly in
the U.S. sphere of influence, is slowly but surely drifting East.
Andres Oppenheimer,
hemispheric affairs columnist for the Miami Herald and El Nuevo
Herald, writes that 2005 will go down in history as "the
year in which the United States lost much of its once almighty
influence in Latin America, and (China) began to play a modest
but rapidly growing role in hemispheric affairs."
Charles Shapiro,
U.S. deputy assistant secretary of state for the Andean Region,
told a congressional committee that "China is an important
new investor in the region as it searches for resources."
He said China's imports from Latin America ($22 billion worth
in 2004) are growing, increasing 16 percent in the first half
of 2005 alone.
It may be
too early to say that China is threatening to supplant U.S. influence
in a region that Washington, D.C., has long treated as its own
bailiwick. But as China's star rises, Latin America is increasingly
looking to Beijing for guidance and investments.
China has
become a blockbuster market for Latin America's mineral and agricultural
exports -- including Chilean copper, Argentine and Brazilian soybeans
and the region's ores and gas resources. China also has demonstrated
a desire to invest in infrastructure projects that Latin America
needs to export more efficiently and reorient itself toward Asia.
China's interest
in Bolivia is motivated by the desire to secure global natural
gas resources. Morales, eager to exploit the second-largest natural
gas reserves in Latin America, would welcome investors like the
Chinese, who understand his desire for a partially nationalized
energy sector and are willing not to meddle in Bolivia's internal
affairs.
The Bolivian
news blog MABB, written by economist Miguel A. Buitrago, notes
that Asia's demand for natural gas will rise 220 percent by 2030,
according to the World Energy Outlook Report. "This should
have a direct impact on Bolivia," he writes, "whether
Bolivians want it or not."
Buitrago continues:
"The world's appetite for NG (natural gas) is insatiable
and will devour anything that remotely resembles NG ... China
alone is expected to drive that demand ... China has even been
to Bolivia offering huge amounts of investments in order to secure
much needed resources ... The challenge is whether Bolivians can
take this opportunity and use their resources to achieve development."
In fact, when
reporters asked Morales how he would confront U.S. displeasure
with his policies, such as his desire to decriminalize the coca
plant, he quickly snapped back that there were other governments
willing to help him -- and immediately cited China.
In neighboring
Argentina, booming soybean exports to China, nearly $2.5 billion
dollars worth, helped it accumulate enough cash reserves to make
a surprise move -- in the first days of 2006 Argentina paid off
its $9 billion debt to the International Monetary Fund in one
lump sum. Brazil, Latin America's largest economy, is also aggressively
pursuing the Chinese market.
Of course
not all is rosy in China-Latin American relations. The Mexican
economy, tied to low-skill manufacturing, has suffered from Chinese
competition. China take a huge share of all foreign investments,
leaving other emerging markets like Latin America without important
capital. Finally, there is the risk that by selling raw materials
to a booming China, which processes them into finished products,
Latin America will perpetuate its status as an underdeveloped,
second-tier player in the world economy.
For now, the
U.S. volume of trade and investment with Latin America, not to
mention its cultural influence, still dwarfs Chinese involvement.
But in the current political moment, China's ascendancy is offering
a window for Latin American economies to at least marginally reduce
their economic dependence on the United States, and enjoy greater
political maneuverability as a result. For Bolivia's Morales,
stronger ties to China may mean he can follow through with promises
to suspend the drug war and nationalize the economy, over U.S.
objections. Copyright PNS
Editor's
note: PNS Associate Editor Marcelo Ballve writes about Latin America
and is a 2005 Inter American Press Association Scholar.
Pacific
News Service 02 20 06
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© 2006 Pacific News Service. All rights reserved
