China forges deeper ties with Latin America amid trade war

Latin America

At a time when the trade war between Beijing and Washington is rippling across the world economy, China has been working to strengthen its economic ties with Latin America.

CGTN’s Franc Contreras reports. 


For decades, Mexico’s former ambassador to China, Sergio Ley has watched the relationship between Mexico and China grow. For him, it is deeply personal. His father was a Chinese immigrant, who became a distinguished business leader in Mexico.

In the mid-1980s, Sergio Ley began his diplomatic career as a cultural attaché at the Mexican embassy in Beijing. Later, he was Mexico’s first consul general in Shanghai. Finally, he became Mexico’s ambassador to China.

In his Mexico City home, he proudly displays a Chinese painting of Beijing, which reminds him that personal contact produces deeper understanding.

Ley said, “One of the key and important programs at that time – one that I am very proud of — were student exchanges. They produced many fruits. In fact, 30 Chinese student diplomats came to Mexico.”

“Unfortunately, the program only lasted until 1985, one year after I arrived in China. The program was suspended because of recurring economic and financial crisis that we had back in those days,” he added.

Despite plans to create people-to-people exchange programs, commercial trade has been the driving force behind relations among Latin American nations and China.

Analysts say Mexico and China benefited from the North American Free Trade Agreement, even though China was not part of NAFTA. Beijing began investing in Mexican assembly factories. Those factories shipped Chinese goods across the border to the United States.

However, in recent years, some of China’s investments in Mexico and other parts of Latin America have been derailed. In 2014, Mexico’s government canceled a $3.75 billion dollar contract with a Chinese-led construction consortium to build a high-speed train.

China made up for that loss by signing a deal with Argentina to build the $2.1 billion dollar Belgrano rail network, along with hydroelectric dam projects worth more than four billion dollars… indicators of Beijing’s growing influence.

China has reached out to other Latin American nations – including Bolivia, a member of the Belt and Road Initiative. As of 2017, Bolivia got more than 20 percent of its imports from China.

Peru is also expecting Chinese investments worth up to 10 billion dollars over the next three years – mainly in the energy and mining sectors.

For its part, the Mexican government is taking steps to create a stronger relationship with China. Mexico’s Foreign Relations Secretary Marcelo Ebrard has made two visits to China this year.

“China is our second-largest trade partner and the third-largest destination for Mexican exports. Both governments recognize there is still enormous potential to be exploited,” Ebrard said during his most recent visit to China.

Experts insist — for a relationship to thrive between China and Latin America, it also requires efforts to understand each other – at a cultural level.

“Today, we need a far deeper understanding of the high complexity of the relationship of China with the Latin American region and each of the countries including Mexico,” said Professor Enrique Dussel Peters, a leading expert on China’s relations with Latin America.

According to Dussel, increasing people-to-people contact will eventually help override these political barriers – and improve relations between China and Latin America.