National Security

Latin America says U.S. has itself to blame for Chinese entry into region that it opposes

Latin American diplomats say the United States has only itself to blame for retreating from the region, allowing China to move into the region and establish stronger economic and diplomatic ties in the Western Hemisphere.

The Trump administration announced late Friday it was at least temporarily pulling its ambassadors out of El Salvador and the Dominican Republic and the charge d’affaires out of Panama after the three countries broke diplomatic ties with Taiwan in an effort to get closer with China, a U.S. trade adversary. China doesn’t recognize Taiwan’s independence.

The administration describes Chinese President Xi Jinping’s signature Belt and Road Initiative, the global investment and lending program, as a debt trap fueling greater economic dependency. It has warned that the communist government would not think twice about taking Latin American shipping ports and assets, as it has before.

But leaders across Latin America largely shrug their shoulders at American warnings. They need cash for infrastructure projects. They need new roads, telecommunications equipment and energy systems. And China is willing to provide it in ways that the United States has not.

“You left some space and the other guy moved in,” a Latin American diplomat told McClatchy, speaking anonymously so he could more freely discuss the relationship with the United States and China. “The region will work first with the people who bring the money.”

The Chinese have been constructing roads, designing new embassies and building technology infrastructures from Argentina to Mexico. It has expanded its interests of Latin American oil, copper and iron and now wants to become a more equal trade and diplomatic partner.

Xi is ready to embrace Latin America as the Trump administration, carrying out its “America First” agenda, has pulled away from multilateral trade policies such as the 12-nation Trans-Pacific Partnership.

But after months, if not years, of withdrawal, the United States is now turning up the pressure and pushing Latin American leaders to choose between the United States and China.

“Do you want to work with us or them,” said Michael Shifter, who as president of the Inter-American Dialogue has deep ties with many leaders across Latin America. “ ‘We’re your preferred partner,’ they like to say.”

The diplomats are blunt. They would rather work with the United States, with whom they have a more established relationship and who has helped the region for decades on multitude of priorities, including the current Venezuela migration crisis as well as national security and counter narcotics.

But they say the United States is in retreat and U.S. companies are simply not offering the kind of investment that the Chinese are offering. And, like President Donald Trump, Latin American leaders face tight elections and constituencies who are eager to see tangible results like new roads, job growth and a growing GDP.

Two weeks ago, the Chinese government welcomed the Peruvian foreign minister with fanfare during a trade visit. Their discussions included more than 50 potential investments projects in Peru. On Monday, China signed an agreement with Costa Rica to encourage more investment and commerce.

In Panama, China is set to build a new embassy at the mouth of the Panama Canal where it’ll be seen by the hundreds of thousands of ships that pass through each year.

“There is no greater symbolic statement of disrespect to the United States-Panama relationship than a Chinese embassy sitting on a spit of land built literally by the earth excavated from the U.S.-led building of the Panama Canal over 100 years ago,” said John Feeley, who served as the U.S. ambassador to Panama until March.

Feeley said it’s important to note that the United States is not going to see Chinese war ships sailing into the Gulf of Mexico. It’s not like terrorism cells spreading across the hemisphere. But there are national security concerns, considering China is increasingly building telecommunications networks where the United States shares sensitive intelligence and security information.

“We shouldn’t be that alarmist,” Feeley said. “This is about commercial espionage and, in terms of diplomatic sway, what the Chinese are doing to consolidate their power in the United Nations and all other international organizations - precisely at a time the United States is walking away from them.”

Jorge Guajardo, Mexico’s former ambassador to China, said there used to be unwritten rules between Mexico and other Latin American countries that they would not allow the Chinese to build their technology infrastructures. But he said Mexico and the rest of the region are listening to the Chinese in ways unlike before amid the U.S. retreat on trade and Trump’s sometime negative rhetoric about the region.

“It doesn’t mean the U.S. is out,” Guajardo said. “It’s just they’re facing competition that wasn’t there before the Trump administration. No Latin American country right now feels in any way encumbered or indebted to the United States with President Trump referring to the region the way we know he refers to the region.”

Early in his campaign, Trump said that Mexico was sending “criminals and rapists” across the border, and has lumped Haiti in with African countries he reportedly referred to with a vulgar term.

The Trump administration has been blunt with its partners in the region, warning that China seeks their “domination.” Sen. Marco Rubio, R-Fl., spoke to Trump about cutting aid to El Salvador and questioned why the United States would provide so much funding to a country after it took such diplomatic steps against U.S. interests.

“Latin American diplomats are right that U.S. disengagement in region has contributed to Chinese gains in the region. What they conveniently fail to mention is the role of hundreds of millions of $ in bribes & contributions to political parties from #China,” Rubio tweeted in response to the McClatchy story.

Leaders in Washington point to Africa and Asia as examples of regions who long enjoyed the appearance of endless financial assistance from China until it was time to pay back the loans. Sri Lanka, for example, wanted help with a billion dollar port. Now, China owns the port.

Venezuela owes tens of billions in debt to China that senior administration officials say future generations of Venezuelans will be on the hook for long after the current government is gone.

“This is the most extreme form of colonialism,” said a senior administration official, speaking on condition of anonymity to speak freely about U.S. priorities. “China is literally taking assets of another country.”

On bilateral visits, China is now a key topic of conversation along with the crisis in Venezuela, immigration and counter narcotics, such as during Defense Secretary Jim Mattis’s recent week-long, four nation tour of South America -- which notably made stops in Brazil and Argentina, two nations with a conspicuous Chinese presence.

The number of Chinese tourists and businessmen who shared the same Brasilia hotel reflected how China has become Brazil’s largest commercial partner. The topic of China’s $50 million satellite and space mission station in Patagonia came up in talks with his Argentina counterpart. Mattis warned that foreign investments in the region could carry hidden national security dangers.

“There’s more than one way to lose your sovereignty,” Mattis said in remarks at Brazil’s Superior War College in Rio de Janiero. It’s not just by bayonets. it can also be lost by economic domination. And that would be my concern.”

U.N. Ambassador Nikki Haley also brought up China to Colombia’s new president Ivan Duque last month.

On a visit to Washington last week, Colombian Minister of Foreign Affairs Carlos Holmes Trujillo deflected a question about concerns raised by Haley about China, but acknowledged it was discussed.

“Our proposal is to strengthen even more the relationship with our traditional friends and diversity thematically and geographically our foreign policy,” Holmes Trujillo said during a forum Friday hosted by the Inter-American Dialog.

David Lewis, vice president of Manchester Trade Ltd., which represents U.S. and foreign businesses operating in Latin America, said working with the Chinese is extremely risky. He won’t tell clients not to do business with the Chinese, but said they must be careful. If they have any problems, recourse is either limited or non-existent.

“We advise clients to have their eyes wide open,” Lewis said. “When you have a problem with Chevron in Ecuador, you have a way to take up that grievance. When you have that problem with the Chinese equivalent with Chevron, good luck.”

While acknowledging that China has made some inroads, the Trump administration insists it’s not afraid to compete. Officials point to an aggressive energy push, including a pact last month signed with Panama to expand the distribution of U.S. liquefied natural gas in Latin America. It’s part of the “Americas grow” or “America Crece” initiative that promotes U.S. exports of energy and energy infrastructure and make it easier for U.S. businesses and U.S. financial markets to invest.

The senior administration official said the United States wants to help Latin American develop their own economy while China only fuels bad habits that lead to greater debt dependency. The result, the official said, is ongoing corruption.

Its not just the United States sounding the alarm. U.S. Treasury Secretary Steven Mnuchin said that leaders of the nation’s largest economies, the G7 countries, all recognize China’s one-way trade practices.

The Australian government has been taking steps and passing new laws aimed at tightening Australia’s security and electoral process after scandals and accusations that China tried to influence on Australian politics.

The Latin American diplomat said he understands the concerns, but he said the reality is the region is wrestling with poverty and weak executive branches. And the United States is not offering what the Chinese are offering. The Chinese bring money and bring it faster. They don’t interfere in domestic affairs, push partners to raise worker’s standards, fight for human rights or get spooked by allegations of a bribe or corruption.

“The answer is we need investment.,” the diplomat said. “We need to create jobs in the short and mid-term, which means we need money for projects to help build roads and raise GDP. We need tangible results.”

Carol Rosenberg contributed to this report.

Franco Ordoñez: 202-383-6155, @francoordonez

Related stories from McClatchy DC