Why China has its eye on Latin America
In the last 10 years, President Xi Jinping of China has had at least five different meetings with Venezuelan President Nicolás Maduro. The meetings culminated in an "all weather strategic partnership" in 2023.
But Venezuela is just one of the many Latin American countries that China is courting.
Even though thousands of kilometers separate them, China became Latin America & the Caribbean's second-largest trading partner in 2021, with almost $450 billion worth of goods exchanging hands, up from $12 billion in 2000, or almost a 40-fold increase.
The region presents an attractive investment proposition for China because of its resources and markets, Margaret Myers, director of the Asia and Latin America Program at the U.S.-based think tank Inter-American Dialogue, told CNBC.
"In Latin America, China's looking for soy, above all, to address what is a fairly critical food security challenge at home. " Myers said.
She added: "The region also plays an important role in China's broader energy security calculations, and that's one reason why we see China continuing to engage with Venezuela, despite the many challenges there."
China also invests directly in key sectors through investments, mergers and acquisitions. Between 2005 and 2020, it invested more than $130 billion in the region, including $60 billion in Brazil, $27 billion in Peru, $27 billion in Chile, while Argentina received $12 billion of Chinese official foreign direct investment.
Ruben Gonzalez Vicente from the University of Birmingham said: "From 2000 to 2010, most Chinese investment in Latin America went into the extractive industries, into mining and oil in South America mostly. [China's] Belt and Road initiative starts in 2013, and what you start seeing is a lot of loans from Chinese policy banks to governments in the region that are used to hire Chinese contractors to develop infrastructure."
Besides infrastructure projects, China has also poured money into politically sensitive areas in the region, such as telecommunications, nuclear energy and space.
Roberto Garcia Moritan, the former Argentinian deputy minister for foreign affairs, said: "There is a space station of China [in Argentina], with Chinese military personnel. So, we are entering into a new phase of the Chinese-Latin America relationship.
"It's not only trade, it's not only commodities, but also a presence that is becoming very important in technological areas."
However, Beijing has insisted in previous media reports that its deep space ground station in Argentina is for civilian use only, adding that "the suspicions of some individuals have ulterior motives."
Watch the video to find out why China has its eye on Latin America.
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