Washington —
For years, China has been seeking to expand its influence in Latin America, a region that is rich in natural resources and considered to be within the U.S. sphere of influence. Since the launch of its Belt and Road Initiative a decade ago, Beijing's reach has expanded through loans, trade agreements and investments in infrastructure as well as the extraction of minerals.
As of 2023, 21 Latin American countries have joined the BRI — including Nicaragua and Argentina last year. After the launch of the BRI in 2013, , but analysts and data show it has decreased in recent years. Meanwhile, trade between China and Latin America continues to expand, although the United States is still the region's biggest trading partner.
China's growing presence in Latin America has been met with mixed reactions. Some countries have welcomed the investment and trade opportunities that China offers. Others have expressed concerns about China's growing influence and its potential to undermine U.S. interests in the region.
Juan Pablo Cardenal, an expert in Chinese politics and economy and co-author of "The Silent Chinese Conquest," says Beijing's influence in the region varies by country, social and political conditions, and the availability of the natural resources that the Asian giant needs to meet the demands of its manufacturing sector.
"China uses its loans and its money as a penetration strategy throughout Latin America and in other parts of the world," said Cardenal.
When China first turned its attention to Latin America, Venezuela was a key target, given its status as a major oil producer with close ties to the United States prior to Hugo Chávez's rise to power, says Parsifal D'Sola, founder and chief executive officer of the Bogota-based Andres Bello Foundation – China Latin America Research Center.
However, Venezuela's disbursal of vast sums of state-owned bank resources from Beijing, calculated at around $65 billion, has served as a cautionary tale for China.
"By 2023, after more than $60 billion in loans, neither China nor Venezuela has anything to show for it, not a single project," D'Sola told VOA. He added that China has since shifted to work more behind the scenes to recover the loans from Venezuela and stopped putting money into the country.
"Venezuela was supposed to be the first country with the first bullet train in the region, but it never happened. The bulk of that money was supposed to be used for the country's oil and gas infrastructure, which imploded," D'Sola explained.
"From Beijing's perspective, Venezuela failed to uphold its end of the deal. This was supposed to be the model for China-Latin America cooperation, but it turned out to be the opposite."
Defying U.S. sanctions, Venezuela has used its oil to pay off billions of dollars in debt to China. Millions of barrels of Venezuelan oil have been rebranded and shipped to China, according to a 2022 Reuters report based on sources familiar with the matter.
Despite China's experience in Venezuela, the BRI model continued to attract the interest of Latin American countries. One simple reason, experts say, is because signing up is not difficult.
Joining the initiative is made through a "memorandum of understanding" that does not legally require the parties to deepen trade or investment, but does represent "a gesture of approval" of China's policies by the participating country, according to D'Sola.
Participation in the BRI does not necessarily involve large loans or donations from China, D'Sola said. He added that based on tracking of participating countries, there is typically a slight increase in interaction or investments in the months following the signing of an agreement, but after that the relationship resumes its normal course.
Observers note that recent developments — including China's tense relationship with the United States and Europe, the effects of the COVID-19 pandemic, and China's own economic slowdown — have led to less big BRI spending and a more strategic approach by Beijing.
Cong Liang, deputy head of the National Development and Reform Commission, says that one area of focus is on more environmentally friendly projects, .
"China will continue to boost the green development of the Belt and Road, better protect the environment, and bring benefits to the people of all Belt and Road partner countries," Cong was quoted as saying.
China has stepped up its search for minerals used in green technologies. Beijing's interest in Latin America includes the region's vast lithium reserves, often referred to as the new "white gold."