Is Washington Losing Latin America?

Peter Hakim

From Foreign Affairs, January/February 2006

Summary:  For nearly a decade, U.S. policy toward Latin America has been narrowly focused on a handful of issues, such as China's growing influence in the region and the power of Venezuelan President Hugo Chávez. Latin Americans want economic ties with the United States but feel slighted by Washington and uneasy about the U.S. role in the world. The costs of the estrangement will be high for both sides.

PETER HAKIM is President of the Inter-American Dialogue.

Washington also worries about China's growing presence in Latin America, a concern that has already been the subject of congressional hearings. In fact, some members of Congress view China as the most serious challenge to U.S. interests in the region since the collapse of the Soviet Union. They cite the huge financial resources China is promising to bring to Latin America, its growing military-to-military relations in the region, and its clear political ambitions there all as potential threats to the long-standing pillar of U.S. policy in the hemisphere, the Monroe Doctrine.

China's interest in Latin America is significant and expanding. The region has become a vital source of raw materials and foodstuffs for China. In the past six years, Chinese imports from Latin America have grown more than sixfold, or by nearly 60 percent a year. Beijing also faces a major political challenge in the region: of the 26 countries that recognize Taiwan, 12 are in Latin America or the Caribbean. China is intent on reducing that number through aggressive diplomacy and increased trade, aid, and investment.

Bush administration officials have watched China's growing commercial and political engagement in the region closely. Chinese President Hu Jintao traveled to Latin America twice in the past two years, spending a total of 16 days there. The White House could not have missed the warm welcome he received in the five Latin American countries he visited, the concessions the host governments offered him (such as the quick granting of "market-economy status" to China), and the enormous expectations his presence created of major Chinese investments in roads, ports, and other infrastructure. Hu's trips have been reciprocated by a long series of visits to China by Latin American heads of state, economic officials, and corporate leaders.

Many people in Latin America look to China as an economic and political alternative to U.S. hegemony. Although officials in some of these countries are concerned that China, with its lower manufacturing costs, will cut into their sales, profits, and investment, others (mainly South America's food- and mineral-producing nations) largely see China as a major potential partner for new trade and investment. Brazilian leaders, including President Lula, have said they want to establish a strategic relationship with Beijing that might involve trade in high-tech products, mutual support in international organizations, and scientific and cultural collaboration. Interestingly, the recent advances of China (and India as well) have prompted some Latin Americans to examine their own economic and political development, producing a new wave of self-criticism about the region's stumbling performance in recent years and intense discussion about what can be learned from the success of some Asian countries.

It is too early to predict what China's longer-term influence on Latin America will be. Chinese trade with Latin America, for instance, may be expanding rapidly, but it still amounts to less than ten percent of U.S. trade with the region. Some of the Latin American countries that were the most eager to forge strong links with China are now having second thoughts. At the time of Hu's November 2004 visit, Argentina and Brazil forecast huge increases in Chinese investment in both countries. Less than a year later, the two governments acknowledged that China's actions had fallen short of their expectations and said they were now eager to stem escalating Chinese imports. Brazil's foreign minister, Celso Amorim, complained that their "expectations were greater. ... Investment is coming slowly." In fact, it has barely come at all.

China is still a long way from threatening or even really competing with the influence of the United States in Latin America. But as in other parts of the world, China is pragmatically and aggressively seeking economic and political advantages there. A few commentators have suggested that with its strong ties to Cuba, growing interest in Venezuela, and presence in Panama, China represents an emerging security risk to U.S. interests in the hemisphere. Most analysts, however, doubt that any of China's initiatives in Latin America will provoke a confrontation with the United States. They point to Beijing's general caution in its relations with Washington, China's recognition of the preeminence of the United States in Latin America, and the far greater importance China assigns to other items on its agenda with the United States.

For its part, Washington is watchful but unalarmed. In testimony before Congress in 2005, then Assistant Secretary of State for Western Hemisphere Affairs Roger Noriega was sanguine about China's budding relationship with Latin America, while also noting, "We will be attentive to any indication that economic collaboration will feed political relationships that could run counter to our key objectives for the region." If Beijing and Washington do spar, it will be over issues that are more important to both of them, such as Taiwan, North Korea's nuclear weapons, and their continuing trade and economic disputes.

AT ARM'S LENGTH

Disappointment with the U.S.-Latin American relationship is a two-way street. Anti-Americanism has surged in every country in Latin America. People in the region, rich and poor, resent the Bush administration's aggressive unilateralism and condemn Washington's disregard for international institutions and norms. A recent Zogby poll of Latin America's elites found that 86 percent of them disapprove of Washington's management of conflicts around the world. Only Cuba and Venezuela are openly hostile toward the United States, and most Latin American governments continue to seek close ties with the United States, including free-trade arrangements, immigration accords, and security assistance -- even though many of them no longer consider the United States to be a fully reliable partner or want to be Washington's ally. The region's leaders are well aware of the overwhelming political and economic strength of the United States and are pragmatic enough to work hard to maintain good relations with the world's only superpower. But they view the United States as a country that rarely consults with others, reluctantly compromises, and reacts badly when others criticize or oppose its actions.

For many in the region, Washington's championing of human rights and democracy now rings especially hollow. Most Latin Americans were dumbfounded by U.S. actions at Abu Ghraib and Guantánamo Bay. The U.S. government has long scolded Latin American countries for their violations of human rights and their shabby judicial procedures, but it suddenly seemed to be playing by a different set of rules when its own security was at stake. Latin Americans, mindful of what have often been devastating U.S. military actions in the region, have never been comfortable with unilateral U.S. interventions and have steadfastly resisted the use of force to promote democracy. Washington's initial enthusiasm for the short-lived April 2002 coup against the freely elected Chávez government raised questions in virtually every country in Latin America about the sincerity of the Bush administration's commitment to democracy. So did Washington's pressuring President Jean-Bertrand Aristide to leave Haiti in 2004.