ISSN 2330-9296
Perry Paper Series, no. 1

The Strategic 

Dimension of 

Chinese Engagement 

with Latin America

R. Evan Ellis

William J. Perry 

Center for Hemispheric Defense Studies

2013
The opinions, conclusions, and recommendations expressed or implied in this paper do 

not necessarily reflect those of Dr. William J. Perry, the Perry Center, or the US Department of Defense.

Book Design: Patricia Kehoe

Cover Design: Vitmary (Vivian) Rodriguez
Contents

Foreword v 

Preface vii

Chapter One

Introduction 1 

Chapter Two

The Impact of China on the Region 11

Chapter Three

The Question of Chinese Soft Power 33 

Chapter Four

Chinese Commercial Activities in Strategic Sectors 51

Chapter Five

The PRC–Latin America Military Relationship 85

Chapter Six

China–Latin America Organized Crime Ties 117

Chapter Seven

A “Strategic Triangle” between the PRC, the US, 

and Latin America? 135

Chapter Eight

The Way Forward 153 

Foreword

With the publication of this volume, the William J. Perry Center for Hemispheric Defense Studies presents the first of the Perry Papers, a series of stimulating thought pieces on timely security and defense topics of global proportions from a regional perspective. The Perry Papers honor the 19th Secretary of 

Defense, Dr. William J. Perry, whose vision serves as the foundation for the first 

three of the five current regional security studies centers.

Dr. Perry has espoused the belief that education “provides the basis for 

partner nations’ establishing and building enhanced relations based on mutual respect and understanding, leading to confidence, collaboration, and cooperation.” 

The faculty and staff of the Perry Center believe strongly in the same principles. “Mens et fides mutua,” the Latin phrase that means “understanding and mutual 

trust,” serves as the motto for the Perry Center and motivates all that we do. This 

paper series will form an important part of our effort to assist and strengthen the 

regional capacity for cooperation and collaboration on a global scale.

The emergence of China as a prominent actor in the Western Hemisphere has given rise to many different interpretations and prescriptions. The 

Perry Center inaugurates this new series with an insightful and wide-reaching 

collection of studies by Dr. R. Evan Ellis, focusing on China’s growing influence 

and interaction in the Western Hemisphere and what it means for the future geopolitics of our region. In The Strategic Dimension of Chinese Engagement with Latin 

America, Dr. Ellis, one of the foremost experts on China and Latin America and 

a professor of National Security at the Perry Center, provides in-depth analyses 

of a variety of aspects of China’s ventures in the hemisphere. We welcome your 

comments and observations on this work.

 

Kenneth LaPlante

Perry Center Acting Director

v

Preface

For almost a decade, my career has been defined by following, writing about, and 

speaking in public forums on the expanding engagement by the People’s Republic of China with Latin America. While there has been a flowering of scholarly 

works on the economic and political dimensions of this engagement,1 its impact 

on the strategic environment of the region has remained an open question. There 

is certainly no shortage of works that assert that “Red China” is a threat2 or, alternatively, that the PRC is merely pursuing “win-win” relationships in the region, 

guided by the five principles of peaceful coexistence,3 and of no threat to anyone. Whatever the merits of these individual works, there is almost no scholarly 

literature analyzing in detail the “strategic” dimension of PRC engagement with 

Latin America. Nor is there clarity regarding what the “strategic” dimension of 

that engagement actually is.

The present work is designed to fill that void. It brings together in one 

place essays on those aspects of the expanding PRC engagement with the region 

relevant to scholars who study issues of defense and security in Latin America, 

including chapters on how engagement with the PRC is impacting political dynamics within and between states in the region; the question of Chinese “soft 

power”; activities by Chinese companies and the Chinese government in strategic technology sectors; military-to-military engagement; emerging trans-Pacific 

organized crime ties; and the question of whether the web of relationships between the US, the PRC, and the countries in the region should be characterized 

as a “strategic triangle.” Although versions of many of these works have been 

published previously, the present volume updates, extends, and integrates them, 

as well as provides new material.

The objective of this work is not to argue whether PRC engagement 

with Latin America is, on balance, positive or negative, but rather to serve as a 

reference for scholars and practitioners interested in both the security and defense of Latin America and the impact of the “rise of China” on the global order 

more broadly.

I would like to acknowledge and thank the William J. Perry Center for 

Hemispheric Defense Studies (CHDS) for providing the time and resources to 

bring this work to fruition. I would also like to thank Dr. Howard Wiarda for his 

mentorship in this process, and for encouraging me to find the time to complete 

this work. 

I would like to specially thank the CHDS interns who made importvii
viii The Strategic Dimension of Chinese Engagement with Latin America

ant contributions to the research and editing of this volume—in particular, Eric 

Skidmore, Karinne Smolenyak, and Florian Decludt.

The opinions expressed in this work are mine alone, and in no way reflect the position of Dr. William J. Perry, the Perry Center, the National Defense 

University, or the US government.

Notes

1 The first two comprehensive works on the topic came out in 2006: A. Catalinac, S. 

Cesarin, J. Corrales, J. Domínguez, S.R. Golob, A. Kennedy, A. Liebman, M. Musacchio-Farias, J. Resende-Santos, and R. Russell, China’s Relations with Latin America: Shared 

Gains, Asymmetric Hopes, China Working Paper (Washington DC: Inter-American Dialogue, 

2006). See also Florencia Jubany and Daniel Poon, “Recent Chinese Engagement in Latin 

America,” Canadian Foundation for the Americas, March 2006. Some of the most important 

works put out during this point in time were also studies done by the International Monetary Fund and the World Bank. See, for example, Daniel Lederman, Marcelo Olarrega, 

and Guillermo E. Perry, “China’s and India’s Challenge to Latin America: Opportunity or 

Threat?” World Bank, 2009. See also Caroline Freund and Caglar Ozden “The Effect of 

China’s Exports on Latin American Trade with the World,” World Bank. See also “Latin 

America and the Caribbean’s Response to the Growth of China and India: Overview of 

Research Findings and Policy Implications,” World Bank, August 2006. Important economic analyses also include Kevin Gallagher and Roberto Porzecanski, The Dragon in the 

Room (Stanford: Stanford University Press, 2010). See also Rhys Jenkins and Enrique 

Dussel Peters, China and Latin America: Economic Relations in the 21st Century (Bonn: German 

Development Institute, 2009). In addition, a number of compiled volumes have emerged 

on the topic since 2009 focused on a mixture of economic and political themes. See, for 

example, Cynthia J. Arnson, Mark Mohr, Riordan Roett, and Jessica Varat, eds., Enter the 

Dragon? China’s Presence in Latin America (Washington DC: Woodrow Wilson International 

Center for Scholars, 2007). See also Riordan Roett and Guadalupe Paz, China’s Expansion 

into the Western Hemisphere: Implications for Latin America and the United States (Washington, 

DC: The Brookings Institution, 2008). See also A. H. Hearn and José Luis León Marquez, 

eds., China Engages Latin America: Tracing the Trajectory (Boulder: Lynne Rienner Publishers, 

2011). See also Gastón Fornés and Alan Butt Philip, The China-Latin America Axis: Emerging 

Markets and the Future of Globalisation (London: Palgrave Macmillan, 2012). See also Cai 

Tongchang, Liu Weiguang, and Wu Baiyi, China–Latin America Relations: Review and Analysis, 

vol.1 (Reading: Paths International, 2012). See also Julia C. Strauss and Ariel C. Armony, 

eds., From the Great Wall to the New World: China and Latin America in the 21st Century (Cambridge: Cambridge University Press, 2012). See also K.C. Fung and A. Garcia-Herrero, 

Sino-Latin American Economic Relations (New York: Routledge, 2012). 2 See, for example, Steven Mufson, “In Panama: Ports in a Storm; GOP Critics Decry Hong 

Kong Firm’s Role at Each End of Canal,” Washington Post. December 8, 1999. See also Manuel 

Cereijo, “Inside Bejucal Base in Cuba: A Real Threat,” The Americano, August 27, 2010. 3 “China’s Policy Paper on Latin America and the Caribbean (full text),” Government 

of the People’s Republic of China, November 2008.
1

Chapter 1

Introduction

Overview

What are the strategic implications of China’s engagement with Latin America for the US 

and for the region? 

The question was perhaps first elevated to the attention of senior US government officials and political leaders with the January 1997 award to the Chinese 

firm Hutchison-Whampoa of a 25-year renewable concession to operate container shipping terminals on both the Atlantic and Pacific sides of the Panama 

Canal.1 Although this storm passed in terms of political and media attention, 

the issue again came to the forefront in 2004 with the five-nation trip of Chinese President Hu Jintao to Latin America in conjunction with the Asia Pacific 

Economic Cooperation (APEC) leaders’ summit in Santiago, Chile. President 

Hu’s trip included announcements of tens of billions of dollars of proposed Chinese projects as he proceeded through the region en route to the summit,2

 and 

also highlighted the People’s Republic of China’s (PRC) exponentially expanding 

commercial engagement with Latin America, including bilateral trade that had 

expanded from $14.6 billion in 20013 to $49 billion by 2005,4 and would surpass 

$238 billion by 2011.5

While the vast majority of Chinese activities in Latin America during 

the past decade have been commercial in character, governments hostile to the 

US in the region, such as that of the late Hugo Chávez in Venezuela, Rafael Correa in Ecuador, and Evo Morales in Bolivia, have publicly trumpeted the PRC 

as an alternative to the US and Western institutions in the region.6 Beyond fiery 

rhetoric, however, the export revenue, loans, and investments that these regimes 

have received from the PRC have helped to finance, and thus to sustain, their 

“Bolivarian Socialist” projects.7

For virtually all countries of the region, and particularly Costa Rica, 

Panama, the Caribbean, and the nations of South America, expanding commerce 

with the PRC, including trade, loans, and investments, were powerful drivers of 

their increasing projection into the world economy. Indeed, for many of these 

states, expansion of economic ties with the PRC fueled an expansion and reorientation of trade and physical infrastructure away from the US, and toward 

multiple global markets with heightened emphasis on the Asia-Pacific region.

In the political realm, a corresponding expansion of interactions with 
2 The Strategic Dimension of Chinese Engagement with Latin America

Asia also fueled the development of new linguistic and subject-matter competencies for dealing with China and other Asian nations in national diplomatic corps.8

Such changes, in turn, both reflected, and helped to enable a process in which 

Latin American countries were developing a more diverse array of foreign relations beyond the region, including ever deeper, more multifaceted relationships 

with Asia. As a natural consequence, such processes also diluted to some degree 

the attention that Latin America had historically given to the US (both positive 

and negative). This shift in the position of the US from being the primary point 

of reference for the region to being one voice among many, in turn, has implications for efforts by the US to pursue its policy agenda in the region, including 

promotion of its vision in areas such as democratization, human rights, and free 

trade.

The dynamics associated with China’s expanding engagement in Latin 

America reflect broader changes in the global order associated with what has 

popularly been referred to as the “Rise of China.”9 Although the collapse of the 

Soviet Union by 1991 freed the United States of the geopolitical rivalry that had 

dominated its strategic outlook since World War II, it refocused attention on a 

more diffuse array of strategic challenges facing the country.10 Even during the 

brief “honeymoon period” of the 1990s,11 from the disappearance of the Soviet 

threat until the advent of the “global war on terrorism” (GWOT),12 the growing 

economic, technological, and military capabilities of the PRC caused some in 

the US national security community to question whether the US-Soviet rivalry 

of the Cold War would be replaced by a new geopolitical rivalry between the US 

and China.13

The possible emergence of such a global competition, however undesirable, shapes the interpretation that the US national security community gives 

to China’s expanding engagement with Latin America and the rest of the world. 

Because of the shadow of such a possible emerging global competition, assessments of Chinese activities in Latin America and elsewhere necessarily consider not only whether such activities are predominantly military or economic in 

character, but also the question of Chinese intent toward the United States and 

the region over the long term, and how Chinese behavior may change as it transitions from dealing with the hemisphere from a position of weakness, to one 

of increasing strength. Moreover, such analysts must ask not only whether Chinese activities present immediate challenges to the national security interests of 

the United States or its neighbors in the Western Hemisphere, but also how such 

engagement, over time, expands and improves the strategic options available to 

the PRC globally, should the relationship with the United States degenerate into 

something more hostile than it is today. 

With virtual unanimity, US senior officials in both Republican and 

Democratic presidential administrations who have addressed the issue of China’s 
R. Evan Ellis 3

engagement with Latin America during the past decade have found that these activities posed no direct or immediate threat to the United States or its neighbors, 

although they have raised concerns about their transparency, and whether the 

nature of these interactions, on balance, will be beneficial or destabilizing to the 

region.14

As noted previously, the documentation of Chinese “strategic” activities 

in the open press has been incomplete at best, scattered among numerous journalistic sources in multiple languages, and hampered by the lack of consensus 

between scholars regarding what, if anything, associated with the Chinese engagement, should be regarded as “strategic.”

Chinese sales of major military end items to Latin American countries 

are reasonably well documented in the Latin American and Western press, as 

are visits by senior military leaders, satellite launches, telecommunications infrastructure projects, the award of port concessions, and other transactions that 

have “raised concerns” within the US and the West. As noted previously, Chinese 

activities such as Hutchinson-Whampoa’s operation of facilities on both ends of 

the Panama Canal,15 and the alleged Chinese presence in Cuban signals collection 

facilities at Lourdes, Bejucal, and Santiago de Cuba,16 are cited anecdotally as 

examples of a “strategic threat” to US interests in the Western Hemisphere.

What has been lacking, however, is an authoritative work in the open 

press documenting the range of Chinese activities in the region of interest to the 

national security community, within an analytical framework that suggests what 

the strategic implications of those activities might be. This work addresses that 

need, providing an unclassified analysis of aspects of PRC engagement with Latin 

America of particular interest to the defense and security community, both in 

the US and in Latin America. Although it is written for an audience interested 

in Latin American security affairs, however, it is also designed to be of interest 

to broader audiences, including scholars and policymakers following the rise 

of China more broadly, the US-PRC relationship, and general issues of security 

affairs and international relations.

By documenting and analyzing the strategic dimension of China’s relationship with Latin America, this work deliberately avoids the question of whether that relationship is inherently a threat to the US, its neighbors, or its interests 

in the region. Nor does it address the issue of whether the PRC has a “right” to 

engage in such activities. Rather, it seeks to establish, in a dispassionate form, 

what is happening and what the strategic implications are for both the US and the 

region.

Framework

In the contemporary globally interconnected world, virtually every aspect of 

China’s engagement with Latin America directly or indirectly impacts the de-
4 The Strategic Dimension of Chinese Engagement with Latin America

fense and security environment in the Western Hemisphere. The term “strategic” 

immediately calls to mind China–Latin America military engagement, which has 

been cautiously expanding, including not only arms sales, but also personnel exchanges for training and professional military education, as well as humanitarian 

deployments in the region.

Indirectly, expanding commercial interactions between the PRC and 

the region has also generated undesirable side effects that fall squarely within 

the province of security and defense, including expanded criminal ties in areas 

such as extortion of Chinese communities in Latin America, human trafficking, 

contraband goods, drugs, and precursor chemicals, money laundering, and arms 

trafficking.

Beyond such “direct effects” on the security environment of Latin 

America, however, commercial competition from Chinese manufactured goods 

in the region and in its traditional export markets such as the United States affect competing Latin American firms and contribute to people losing their jobs, 

augmenting hardship and social tension, even while creating opportunities in 

other areas through the process that economist Joseph Schumpeter once called 

“creative destruction.”17 Similarly, Chinese loans and investments in Latin America and the Caribbean tend to focus on large projects centered on negotiation 

between the commercial entities that control the capital, and Latin American 

government entities who ultimately decide who gets to do the work—a natural 

breeding ground for corruption. The social displacement and corruption generated by these processes, in turn, augments the challenges of governability across 

the region.

On the other hand, revenue from expanded exports to the PRC, in 

combination with new Chinese investments on the ground in the region, create 

jobs and put increased revenues from taxes and royalty payments into the hands 

of Latin American governments. Such resources, in turn, may help to fund police 

and military forces in the region to combat crime and provide for citizen security, as well as fund development and social programs that contribute to security 

in the region more broadly. PRC economic engagement with Latin America can 

thus have both a positive and a negative impact on the security environment of 

the region, with the balance depending on the details of each case.

Another dimension of China’s impact on the region’s security environment is that some of the PRC’s most intense relationships in the region, involving the greatest flow of loans, investments, and export revenues benefitting the 

Latin American partner, have gone to those nations whose political orientation 

is most stringently anti-American, including Venezuela, Ecuador, Bolivia, and 

Argentina. Although the PRC has been very cautious not to associate itself with 

the anti-US rhetoric and activities of these regimes,18 its loans to them and its assistance to them in developing, then buying, their primary product exports, has 
R. Evan Ellis 5

indirectly sustained the pursuit of domestic activities by these regimes that the 

US and other Western nations consider questionable. By extension, it has thus 

also contributed to their attempts to influence their neighbors and undermine 

the US policy agenda in the region as a whole, ultimately shaping the security 

environment of the region in ways that US policymakers would not regard as 

positive.

As suggested by the impact of Chinese engagement on the nations of 

the Bolivarian Alliance for the Americas (ALBA), but even more broadly, PRC 

engagement with Latin America has transformed, and continues to transform, 

the way that Latin American states commercially and politically relate to each 

other. For states on the Pacific side of the continent, the PRC has become a 

cornerstone of emerging new national strategies for positioning their countries 

as commercial gateways between Latin America and the Pacific. It thus indirectly played a key role in the formation of the “Alliance of the Pacific,” formally 

launched in a meeting at the Paranal Observatory in Chile in June 2012, to include Chile, Peru, Colombia, and Mexico as founding members and Panama and 

Costa Rica as observers.19 

In a similar fashion, the prospect of doing business with the PRC, in 

combination with funding from Chinese banks and investors, is transforming 

the infrastructure of the region, with the expansion of Pacific coast ports and 

a myriad of new highway and rail projects principally aimed at facilitating the 

connection of the continent with the Pacific. Projects include upgrades to existing roads and other transportation systems to create new “Bi-oceanic” corridors 

from Ecuador, Peru and Chile into Brazil. In the process, the desire to “connect 

to Asia” has opened up previously isolated areas of the continent not only for legitimate traffic, but also for criminal activity, even while increasing the possibilities for social conflict stemming from expanded interactions between previously 

isolated indigenous communities, new migrants, and opportunistic criminals.

For states on the Atlantic coast of the continent such as Brazil, trade 

with and investment from the PRC has created new interests in its neighbors. 

For Brazil, whose relationship with the continent has historically displayed a 

complex pattern of isolationism and exceptionalism punctuated by engagement, 

neighboring states with access to the Pacific such as Peru, and even those states 

physically collocated between Brazil and Pacific coast ports, such as Paraguay and 

Bolivia, occupy an increasingly important role in Brazil’s evolving strategic vision 

of its neighborhood.

As shown by the examples given in the preceding paragraphs, there is 

virtually no area or transaction between China and Latin America that can be 

excluded from a truly exhaustive concept of aspects of China’s engagement with 

the region relevant to defense and security analysts. Indeed, the importance of 

China in the economic realm, combined with the interconnectedness of security 
6 The Strategic Dimension of Chinese Engagement with Latin America

issues with economic ones, argues that the defense and security community must 

continue to examine such issues in order to do an adequate assessment of the 

impact of the new engagement with China within their area of focus. 

Organization 

The issue of the strategic dimension of Chinese engagement with Latin America 

is addressed in the following seven chapters: 

Chapter two contains an analysis of how the PRC has impacted both the 

internal dynamics of the states of the region, and how they relate to each other. 

While many of the dynamics discussed are political and economic in nature, the 

chapter lays the groundwork for understanding how the PRC is transforming 

the strategic landscape of Latin America, as a building block for the discussion 

of issues more traditionally associated with security and defense in subsequent 

chapters. 

Chapter three takes up the question of Chinese “soft power.” It argues 

that such power is frequently underestimated because of the application metrics 

derived from an understanding of US soft power in the region. It further maintains that when Chinese soft power is assessed according to its true sources—

hopes for Chinese investment and access to Chinese markets, and the diffuse 

but compelling concept of the PRC as an emerging global contender—the PRC 

is shown to have significant leverage over Latin American decision makers and 

publics, with consequences for US attempts to advance its agenda in areas such as 

democracy, free markets, and human rights. The chapter also examines dilemmas 

confronting the PRC in using that soft power as the increasing physical presence 

of Chinese companies on the ground in the region creates an expanding array of 

needs for the PRC to protect its companies and personnel in the region.

Chapter four examines PRC commercial activities in the region in three 

sectors that may be considered “strategic”: telecommunications, space, and logistics. It argues that the Chinese construction of telecommunications and space 

infrastructures in Latin America is significant. It notes, on one hand, that there 

is little public evidence that the Chinese are currently encouraging the development of such sectors for nefarious purposes, but that, in time of conflict with the 

United States, such infrastructures could afford important strategic benefits to 

the Chinese.

Chapter five examines China–Latin America military interactions. The 

analysis is concentrated on three areas: senior-level visits and personnel exchanges, military sales to the region, and the physical presence of the Chinese 

in the region through bilateral exercises and similar activities. It argues that the 

primary benefits of such interactions are the development of business in sectors 

of strategic importance for the Chinese, as well as helping the PRC to build valued relationships with the military as a key Latin American institution. It notes 
R. Evan Ellis 7

that although the Chinese have been very cautious not to develop formal basing 

agreements or military alliances that appear oriented against the United States, 

the institutional knowledge and relationships generated by these activities must 

be considered from the perspective of how they impact the strategic positioning 

of a world in which the PRC and the US may find themselves confronting each 

other.

Chapter six looks at emerging organized crime ties between the PRC 

and Latin America in six areas: extortion of Chinese communities, human trafficking networks, drugs and precursor chemicals, contraband goods, money 

laundering, and weapons trafficking. It argues that such ties are a natural byproduct of increasing commercial interactions between the two regions. It further asserts that such interactions, currently modest, could expand rapidly in the future 

due to the relative lack of capabilities within Latin American law enforcement to 

penetrate Chinese communities and follow-technical leads across the Pacific.

Chapter seven examines the question of the interrelationship between 

the PRC, the United States, and the countries of Latin America as a “strategic 

triangle.” It asserts that the often used triangle metaphor is deeply flawed, and 

its use may contribute to a mistaken understanding of the regional dynamic, as 

well as poor or even counterproductive policy prescriptions. Nevertheless, it 

acknowledges that, if its analytical limitations are consciously acknowledged, the 

triangle concept is useful in orienting analysts and policymakers to the interdependencies among China, the US, and Latin American actors, as well as areas of 

potential collaboration between them.

Chapter eight summarizes the findings of this work and provides a series of recommendations for US policymakers focused on a bold proposition: 

given the likely persistence of the PRC as a major global actor and that efforts to 

“contain” the PRC in Latin America are likely to be counterproductive, it is in the 

long-term strategic interest of the United States to help bring the PRC into Latin 

America as a constructive partner in a way that reinforces key norms, security, 

and developmental goals of the region. 

Notes

1 The 25-year concession was awarded to Hutchison-Whampoa in January 1997 in 

Panama Public Law No. 5. See Constantine C. Menges, China: the Gathering Threat (Nelson Current, 2005): 396.

2 See, for example, “Foreign Minister Li Zhaoxing Comments on the Fruitful Results 

of President Hu Jintao’s Trip to Latin America,” Ministry of Foreign Affairs of the People’s Republic of China, November 26, 2004.

3 Direction of Trade Statistics Yearbook, International Monetary Fund (2007), 132. 4 Direction of Trade Statistics Yearbook, International Monetary Fund (2012), 924.
8 The Strategic Dimension of Chinese Engagement with Latin America

5 Ibid.,155. 6 During his 2011 visit to the PRC, for example, Morales proclaimed that “China is 

a country so great that from here, I can imagine that within a short time, the United 

States will be a colony of China.” “Evo anuncia siete convenios con China," Los Tiempos

(Cochabamba, Bolivia, August 16, 2011). During a trip to China, Venezuelan president 

Hugo Chávez claimed that the South American revolutionary hero Simon Bolivar and the 

Chinese revolutionary leader Mao Zedong would have been “great friends.” See Alberto 

Alemán Aguirre, “Relaciones que saben a petróleo,” El Nuevo Diario (Managua, Nicaragua, August 15, 2012). Similarly, during his January 2009 trip to China, Morales exuberantly declared himself to be a “great admirer of Mao.” See also Mireya Tabuas and Maria 

Alesia Sosa, “No es un cuento chino,” El Naciónal (Caracas, Venezuela, April 15, 2012). 7 Although the PRC has been cautious not to publicly associate itself with the anti-US 

rhetoric of ALBA leaders, its financial support has played an important role in directly 

or indirectly underwriting the programs of ALBA regimes, including loans linked to 

the provisioning of Chinese products and services such as infrastructure work, commodity purchases (often linked to the repayment of those loans), and, to some degree, 

investment. As of the time of this writing, Venezuela had received approximately $38.5 

billion in loans from the PRC, while Ecuador had received approximately $8 billion. In 

addition, PRC investment commitments in the Venezuelan oil sector alone totaled over 

$40 billion.

8 For greater detail on this phenomenon, see R. Evan Ellis, China and Latin America: The 

Whats and Wherefores (Boulder: Lynne Rienner Publishers, 2009). 9 See, for example, Michael E. Brown, Owen R. Coté, Sean M. Lynn-Jones, and Steven 

E. Miller, The Rise of China (Cambridge: MIT Press, 2000). 10 See, for example, Report of the Quadrennial Defense Review (Washington DC: US Department of Defense, May 1997).

11 The seminal academic work declaring the triumph of the West in its battle against 

“Communism” was arguably Francis Fukuyama’s essay, “The End of History?” The National Interest (Summer 1989). For an extended version of Fukuyama’s thesis, see also Francis 

Fukuyama, The End of History and the Last Man (New York: Free Press, 1992, 2006). 12 See Scott Wilson and Al Kamen, “‘Global War On Terror’ Is Given New Name,” 

Washington Post (March 25, 2009). 13 The 1997 Quadrennial Defense Review, for example, notes that “in the period beyond 

2015, there is the possibility that a regional great power or global peer competitor may 

emerge. Russia and China are seen by some as having the potential to be such competitors.” See Report of the Quadrennial Defense Review, US Department of Defense (May 1997). 14 In a November 2009 speech at the Center for Hemispheric Defense Studies, then–

Deputy Assistant Secretary for Defense for the Western Hemisphere Dr. Frank Mora said 

that it was his view that China’s deepening engagement in the hemisphere could play a 

productive role in ameliorating challenges affecting the region, but expressed concern 

over the transparency of Chinese activities in the region. Frank. O. Mora, presentation to 

the conference “Strategic Implications of China’s Evolving Relationship with Latin America,” Fort Lesley J. McNair,Washington, DC, (November 6, 2009). See also the statement 

by former Assistant Secretary of State for the Western Hemisphere Arturo Valenzuela, 

in Zhang Ting, “China ‘Not a Threat’ in Latin America,” China Daily (August 19, 2011). 
R. Evan Ellis 9

Similarly, during his April 2004 testimony to Congress, for example, then–Deputy Assistant Secretary of Defense Rogelio Pardo-Maurer testified that there was “no evidence 

that Chinese military activities in the Western Hemisphere, including arms sales, pose a 

direct conventional threat to the United States,” yet warned that “this is not to say that 

there are no concerns.” House International Relations Committee, Subcommittee on the 

Western Hemisphere, hearing on “China’s Influence in the Western Hemisphere,” serial, 

no. 109-63, April 6, 2005.

15 Steven Mufson, “In Panama: Ports in a Storm; GOP Critics Decry Hong Kong Firm’s 

Role at Each End of Canal,” Washington Post (December 8th, 1999). 16 See, for example, Manuel Cereijo, “Inside Bejucal Base in Cuba: A Real Threat” The 

Americano (August 27, 2010). For the refutation of this argument, see “Cereijo, Bejucal, 

China, and Cuba’s Adversary Foreign Intelligence (Bill Ratliff, US),” World Association of 

International Studies (April 3, 2006). 17 Joseph Schumpeter, Capitalism, Socialism and Democracy (London: Routledge, 1942). 18 “Pekín se desmarca de vínculo ideológicos con Venezuela a la llegada de Chávez,” El 

Universal (Caracas, Venezuela, September 23, 2008). 19 Australia, Canada, Spain, New Zealand, and Uruguay were welcomed as observers during the 5th summit of the organization in Cadiz, Spain, in November 2012, and 

Paraguay has formally requested to be included as an observer. “Paraguay, Suspended 

from Mercosur Has Requested Pacific Alliance Observer Status,” MercoPress (January 30, 

2013).

11

Chapter 2

The Impact of China on the Region1

Introduction

In the nine years since Hu Jintao’s November 2004 trip to the APEC Summit 

in Santiago, China’s expanding engagement with Latin America has profoundly 

changed the region. The transformation is far more significant than the Chinese 

motorcycles and car dealerships in Bogotá, Lima, and Santiago; the Lenovo computers now commonly found in Latin American offices; and the now ubiquitous 

Huawei and ZTE cell phones. It is much more significant than the self-instruction CDs and books in Mandarin now available in street vender kiosks, or the 

thousands of containers marked China Shipping, COSCO, or Hanjin visible in 

Latin America’s ports and highways. Beyond these basic symbols of new commerce, China’s transformation of Latin America includes new China studies programs at its leading universities, and the new physical infrastructure connecting 

the region to the Pacific. Less apparent, but perhaps more significant, China’s 

impact is recognizable in the shifting priorities of Latin American business and 

government leaders. This trend belies statistics indicating the US is still Latin 

America’s number one investor and trading partner. Finally, even more subtle 

but significant, are changes in the ways countries in the region relate to one another as a consequence of China’s regional engagement.2

A great deal of research has been done in recent years on China’s engagement with Latin America, whether it constitutes an opportunity or a threat 

to the region. From a Latin American perspective, the question is often framed 

in terms of whether the new commerce with the PRC hurts established manufacturers, permits new revenue, investment, and financing streams, and, on 

balance, whether it will serve as an engine of the region’s development or its 

deindustrialization.3 From a US perspective, the question is how China’s expansion into Latin America will impact the position of North American companies 

and the US political and economic policy agenda toward the region. Surprisingly, 

almost none of the growing literature on the commercial or national security 

dimensions of the new engagement directly addresses the question “How is enhanced Chinese engagement in Latin America changing the political and social 

dynamics within the region and the way Latin American states relate to each 

other?”
12 The Strategic Dimension of Chinese Engagement with Latin America

The present chapter is focused precisely on that question, and finds that 

the PRC’s engagement with Latin America is transforming the region and its dynamics in important ways including impacts on its internal economic, political, 

and social structures, as well as the dynamic between the states of the region and 

its supranational institutions.

At the national and subnational level Latin American engagement with 

the PRC and its companies and institutions is:

• transforming the priorities of youth and educational institutions;

• reshaping the agenda of businesses and their institutions;

• altering the balance between domestic manufacturing and primary product 

exports; and

• inserting Chinese entities as players in domestic politics. 

At the supranational level, China’s engagement with Latin America impacts relations between states, with significant and often contradictory consequences for the dynamics of the region and its processes of integration. It is:

• transforming the physical infrastructure of the region and domestic patterns 

of commerce;

• diluting the relevance of the US government and companies;

• expanding the political and economic breach between South America, and 

Mesoamerica;

• enabling the rise of Brazil and driving its strategic engagement with its 

neighbors;

• sustaining the Bolivarian block beyond the point of its logical evolution; and

• fueling a strategic Atlantic-Pacific split between the nations of Latin 

America. 

Although the consequences of this engagement on the strategic environment of the region are significant, the engagement itself is principally a product of Chinese companies pursuing business interests of strategic importance to 

the PRC as it expands economically in the context of a global world economy. 

Such interests include the search by Chinese companies for reliable access to 

primary products (such as petroleum) metals, and agricultural goods to meet 

the current and projected demands of its customers, as well as attempts to develop new markets for its products and services, including goods in strategically 

important sectors such as autos, heavy machinery, computers, and telecommunications, as well as services, such as construction projects and loans.

While the motives for such engagement may be varied, however, it is 

difficult to find an actor in the region, either at the national, supranational, or 

subnational level, whose interests are not affected by the new Chinese role in the 

region.
R. Evan Ellis 13

The Impact of China at the National and Subnational Level

Whether or not the PRC consciously strives to do so, its engagement with Latin 

America is reshaping the economic, social, and political dynamics of individual 

countries of the region.

Youth and Educational Institutions

Across Latin America, the sense of China as the “wave of the future” is palpable. 

In a PEW research survey released in June 2012, 27 percent of those surveyed in 

Brazil indicated that “China” was currently the world’s leading economic power, 

versus 43 percent who afforded the mantle to the US, and almost double the 

number who answered “China” just a year earlier.4

The sense of “China as the future” is particularly evident among Latin 

America’s youth. In universities, and even secondary schools across the region, 

there is a growing body of students sufficiently convinced of the coming importance of China on the world stage, and to their future, that they are willing 

to invest the considerable time and effort to learn Mandarin Chinese and seek 

opportunities for internships or work in places like Shanghai, Guangzhou, and 

Beijing.5 For the best and brightest of Latin America, such cities have taken on an 

aura once held by New York, and later Silicon Valley, where business pioneers can 

achieve great fortunes on the weight of their competence and long work hours.

Behind such youth are their equally enthusiastic parents. With surprising frequency, senior Latin American business and government figures are seeking Mandarin-language instruction and study-in-China opportunities for their 

children to prepare them to take advantage of the opportunities represented 

by the emerging China. In an informal survey administered by the author of 

the present work to 42 mid-level professionals from across Latin America, 48 

percent responded that if they had the financial means, they would have their 

children study Mandarin Chinese.6

At the institutional level, leading Latin American public and private 

universities have taken steps in recent years to create or expand China-oriented 

business or area studies programs and to incorporate formal Chinese-language 

programs. These include the China-Mexico Studies Institute (CECHIMEX) at 

the Universidad Nacional Autónoma de México (UNAM), the China-Brazil center at 

the Federal University of Rio de Janeiro (UFRJ), the China Studies Center at the 

Pontificia Universida de Católica de São Paulo, and the China-Latin American Studies 

Center at the Universidad Andrés Bello in Chile. There are also a number of new 

or expanded Asia-Pacific studies centers in universities of the region, including 

those in the Instituto Tecnológico de Monterrey (ITESM) to the Universidad EAFIT

in Medellín, Colombia, to the Escuela Superior Politécnica del Litoral (ESPOL) in 

Ecuador, the University of Brasilia, the University of Buenos Aires in Argentina, 

and the University of Chile, to name but a few. In many more cases, new or 
14 The Strategic Dimension of Chinese Engagement with Latin America

expanded China studies programs have been incorporated within existing university departments. Examples include the international studies program at the 

University of the Andes in Bogotá and the CIES research center at the ICESI

University in Cali, Colombia, or the China studies master’s program at the Universidad de San Francisco in Quito, Ecuador.

A key indicator of the expanding interest in such programs has been the 

expansion of Confucius institutes, which represent a partnership between Chinese government and an individual university for Chinese language and cultural 

studies. From the opening of the first Confucius Institute in Latin America in 

Mexico City in February 2006,7 a total of 21 have been created in Latin America.8

While the number of China studies programs in the region is still small, 

they reflect a significant reorientation in the intellectual focus of the region, 

which, in turn, feeds the ongoing process of growing intellectual awareness of, 

and attention to, China, further accelerating the economic and other bonds now 

forming across the Pacific.

The New Agenda of Latin American Business

It is difficult to find a company in Latin America that does not have the PRC on 

its radar screen in one form or another, either as a market, a source of funding 

or investment, or as a competitor. Latin America’s leading executives such as 

Brazil’s Aike Batista and Chile’s Andrónico Luksic are known in part for their 

zeal toward the Chinese market. Indeed, América Economía, one of Latin America’s leading business journals, considered interest by Latin American businesses 

in establishing themselves in China to be a story of sufficient importance that it 

dedicated its August 2011 cover story to that topic.9 

The annual China–Latin America business summit, alternately held in 

Latin America and China, routinely attracts hundreds of businessmen from the 

region. Similarly, hundreds of Latin American businessmen regularly travel to 

China for the opportunity to represent their products at expositions, such as the 

bi-annual Canton Trade Fair, pay thousands of dollars each to travel to China on 

dedicated business expeditions, or pay even more to China-oriented consulting 

firms which facilitate transactions for Latin American and other companies that 

want to import goods from China, or more ambitiously, sell their goods to consumers in the PRC.

At the aggregate level, business associations such as the national federation of businessmen (FENALCO) in Colombia and the Industrial Federation of 

Rio de Janeiro (FIRJAN) in Brazil are increasingly active in bringing in China experts and providing services to facilitate efforts by their members to “get smart” 

regarding the PRC.

While the United States and Europe continue to be in the business plans 
R. Evan Ellis 15

of such companies, it is increasingly the PRC that commands their attention and 

increasingly their resources, either as an opportunity or as a threat.

The New Dominance of Primary Product Exports

In general terms, expanding trade between Latin America and China has been 

a story of an expanding dollar volume of Latin American primary product exports to China, and an expanding volume of manufactured goods of increasing 

value-added from the PRC to Latin America. The commensurate profitability 

of Latin American primary product industries has attracted capital to these industries, reinforced by Chinese companies that have invested in these industries 

in pursuit of secure global sources of supply to meet the current and future 

obligations of their clients. Large, high-profile examples include the acquisition 

of Brazil’s Peregrino oil field in 2010 for $3.1 billion by the Chinese company 

Sinochem, Sinopec’s injection of $7.1 billion into Repsol YPF’s Brazil operations, 

the acquisition of a 30 percent stake in Galp for $5.2 billion, the acquisition of 

Bridas by China National Offshore Oil Company (CNOOC) for $3.1 billion, 

and the acquisition of Occidental Petroleum’s Argentina operations for $2.5 billion,10 among others. Other acquisitions made by Chinese investors with the intention of injecting significant new quantities of capital into the field include the 

Toromocho, Rio Blanco, and Galleno mines in Peru, Corriente in Ecuador, Emerald Energy and Omnimex in Colombia, and Itaminas in Brazil, among others. 

Chinese firms have also purchased concessions to develop new mineral deposits 

and oilfields, including almost $40 billion in investment commitments in the 

Orinoco region of Venezuela and multiple new oil blocks in Brazil.

As a consequence of these patterns, Latin America’s extractive sectors 

have prospered and expanded, while its low-end manufacturing has withered. 

In the Brazilian case, analysts have bemoaned what they refer to as a process of 

“deindustrialization.”11 It is true that Latin American agricultural exporters such 

as Brazil and Uruguay have made headway in exporting higher value-added goods 

to the PRC, such as chicken, pork, and beef, while some Latin American manufacturers have survived by purchasing factor inputs from Asia or outsourcing 

component production to less expensive areas, such as the PRC.

In general terms, however, the rise of China in Latin America has highlighted the role of primary product exports, and whittled away at manufacturing, which served as the engine of modernization and the backbone of political 

and social movements for two generations. Ironically, with the partial exception 

of Brazil, Argentina, and Mexico, the return to a primary product export economic model has been supported by ruling elites, whose macroeconomic figures 

and associated tax revenues have been buoyed by expanded commodity exports, 

allowing them to maintain fiscal solvency while funding programs for key constituencies.
16 The Strategic Dimension of Chinese Engagement with Latin America

The process driven by China not only involves changes in the economic 

structure of the region, with the associated social impacts of displaced companies and workers, but also a political shift, with a “return” to historically strong 

alliances between primary product export sectors and political leaders, partly at 

the expense of organized labor and manufacturing interests.

The Impact of Chinese Companies and Projects on Latin American Domestic Politics

One of the newest and most significant impacts of the PRC on Latin America’s 

domestic political dynamics has been the physical presence of Chinese companies 

on the ground in Latin America. In the mining and petroleum sectors, Chinese 

companies such as CNPC, Petrochina, CNODC, Minmetals, Chinalco and others are moving forward to develop assets that they previously obtained rights 

to through a combination of acquisitions and negotiations with governments.12

Chinese companies have tended to use their own petroleum service companies 

and engineering companies to develop the properties that they have acquired. 

Examples include the use of the Chinese firm Kerui in Colombia by Mansrovar 

energy, jointly owned by Chinese and Indian interests,13 and the use of Great 

Wall Drilling by Emerald Energy in Colombia, after the latter was acquired 

by the Chinese firm Sinochem in 2009.14 It similarly includes the use of CPEB 

Chanquing and other Chinese petroleum service companies in Ecuador by China 

National Petroleum Corporation (CNPC) following its acquisition of the Ecuadoran assets of the Canadian firm EnCana in 2006.15 Major Chinese petroleum 

projects in Venezuela (Junin 1, 4, 8, Boyaca 3, and Mariscal Sucre), and previously mentioned mining investments in Ecuador, Peru, and elsewhere are likely to 

use Chinese subcontractors and large quantities of Chinese labor as well.

Beyond mining and petroleum, the explosion of Chinese bank–financed 

infrastructure and resort projects in the Caribbean and the Andes is fueling a 

wave of work by Chinese construction companies and workers in the region. An 

estimated $75 billion in such loans have been made in the past two years, with 

the use of Chinese companies typically a key condition for the funding.16

Finally, in Brazil and other large, typically southern cone nations, Chinese companies are beginning to construct final assembly facilities and distribution networks in the country in support of expanding sales in the region in strategically important high-value added manufacturing sectors such as autos, heavy 

equipment, computers and telecommunications. Examples include assembly facilities by the Chinese carmaker Chery in Venezuela17 and Argentina,18 with plans 

to construct an additional plant in Brazil,19 the heavy equipment manufacturers 

Sany, Zoomlion, and XCMG, and the construction of technology parks and training facilities by the telecommunications firms Huawei20 and ZTE.21

In virtually all of these cases, the investment itself and its subsequent 
R. Evan Ellis 17

execution has become an object of contention in domestic politics over issues 

such as the number of Chinese workers brought in,22 concessions given by the 

government, and the environmental impact.23 In the Bahamas, for example, the 

number of Chinese laborers authorized by the government to work on the Baha 

Mar resort complex,24 the amount spent by the government to prepare the site 

with roads, water, and electricity, and the question of selling the Grand Bahamas 

Port Authority semiprivate regulatory organization to the Chinese port operator 

Hutchison-Whampoa25 have all become major issues of debate in the two-party 

political system of the country. A concession granted by the Ecuadoran government to the Chinese firm Tongling to develop a new open air mine in Zamora-Chinchipe, for example, became the object of national protests in March 

2012, including the brief occupation of the Chinese embassy in Quito26 and a 

march on the capital by environmentalist and indigenous groups.27 Similarly, in 

Suriname, an initiative by the firm China Zhang Heng Tai to produce palm oil on 

a 40,000 hectare plantation in Marowijne briefly became the center of a national 

debate, with local residents vociferously opposing the project on the grounds that 

Chinese laborers would displace local jobs.28

Once the Chinese entity is established in-country, as with previous generations of Western companies investing in the region, it continues to generate 

impacts, including in its relations with the local labor force and community.29

Prominent examples include ongoing labor unrest at the Shougang Hierro Peru 

mine in Marcona, including a September 2011 strike that commanded national 

attention when the Peruvian Vice President personally carried the demand of 

the miners to the Peruvian congress.30 Beyond Peru, similar frustrations gave 

rise to protests in September 2010 against China Harbor Engineering Company near Kingston, Jamaica, on the grounds that the company had not hired the 

promised number of Jamaicans in its government-funded work on the Palisadoes 

road project.31 Even in Venezuela, where the national government exercises significant control over the media and trade unions, there were public complaints 

by Octavio Campos and the national workers federation in June 2012 over the 

hiring of 3,000 and authorization to hire 30,000 Chinese workers by CITIC to 

work on Ft. Tiuna. 32

In some cases, the disputes have given rise to large-scale violence, such 

as the takeover of the Andes Petroleum oilfield in Tarapoa, Ecuador, in November 2006,33 or the July 2007 protests against the Chinese firm Petroriental in 

Orellana that led to more than 24 deaths and the declaration of a national state of 

emergency.34 Similarly, in August 2012, Chinese and Cuban personnel had to be 

evacuated from Linden, Guyana, when the mine operated there by the Chinese 

firm Bosai Minerals was besieged by protesters, upset over the Guyanese government’s decision to end subsidies for electricity being supplied by Bosai to the 

local community.35
18 The Strategic Dimension of Chinese Engagement with Latin America

Chinese oil companies have also become involved in security questions. 

In November 2012, in Chaguramas, Venezuela, for example, robbers entered a 

municipal government building and stole $650,000 bolivares in cash belonging 

to China Railway Road, planned to be used for its payroll.36 

In Colombia, after the Chinese firm Sinochem acquired the oil company Emerald Energy in August 2009, its operations in Colombia experienced an 

escalating series of attacks,37 with more than two dozen incidents,38 including 

the destruction of company trucks, a bomb attack against a drilling rig, 39 and, 

in June 2011, the kidnapping of three of its workers. 40 Despite assurances from 

local military commanders that the operations would be protected, the incidents 

continued, including an attack on an oil tanker carrying crude from the company’s Ombu field, killing two civilians.41

Thus, in multiple ways, Chinese companies in Latin America are becoming relevant actors in the Latin American domestic political context, deliberately or inadvertently influencing the political environment in which they 

operate.

Impact of China on Supranational Dynamics

In addition to changing the political, social, and economic dynamics of individual 

Latin American countries, China is also affecting how those countries relate to 

each other and to the broader set of international players.

The New Physical Infrastructure Connecting Latin America 

to the Pacific

Expanding trade with the PRC and the rest of Asia has accelerated the expansion 

and improvement of infrastructure connecting Latin America to its Pacific coast, 

with associated implications for the strategic geography of the continent. 

Virtually every major Pacific coast port in the region has been the 

focus of expansion plans from Manzanillo and Lazaro Cardenas in Mexico to 

Buenaventura in Colombia, Callao in Peru, and Iquique and Valparaiso in Chile, 

among others. Expansion plans have included new terminals cranes and other facilities, as governments, port operators, and investment groups position 

their facilities to become key hubs in the new commerce with Asia. Formerly 

low-volume ports, such as Manta, Paita, Ilo, and Machala have become the targeted outlets for improved routes across the Andes into the Amazon, or points of 

access to new mines and oilfields further inland. While some port projects, such 

as La Union, Farfan, and Manta have stalled short of completion, the mixture of 

successes and failures only serves to highlight the dynamism with which attempts 

to connect the continent to Asia are proceeding forward.

Beyond the ports themselves, interest in commerce with Asia has also 

given new life to road, rail, and other infrastructure projects linking the interior 
R. Evan Ellis 19

of the continent to its coasts. Ironically, the core set of projects was conceived 

and socialized by Brazilian President Henrique Cardoso as a tool for expanding 

Brazilian influence among its neighbors, and officially adopted by the broader 

community of South American leaders in 2000 as the “Initiative for the Integration of the Regional Infrastructure of South America” (IIRSA).42 Prominent 

examples include “bi-oceanic” corridors from the Pacific coast of Peru at Ilo and 

Paita and from the Ecuadoran port of Manta, to the interior of Brazil, and that 

from the north of Chile at Iquique, across Bolivia, to the south of Brazil. Although progress on such projects was initially slow because of the enormous 

investment required, the importance of connecting the continent to take advantage of the new commerce with Asia has helped to propel such initiatives. The 

southern bi-oceanic corridor from the ports of San Juan Marcona, Matarini, and 

Ilo in Peru, to Brazil at Iñapari was inaugurated in December 2010. The Bolivian 

segments of the Chile–Bolivia–Southern Brazil corridor were nearing completion in June 2012,43 while the northern “inter-oceanic corridors” from Paita, and 

the Manta-Manaus corridor are complete but for several difficult to construct 

sections through the Amazon swampland.

A range of smaller but equally important infrastructure projects are also 

part of this same logic, including the “dry canal” railroad upgrades from the Atlantic to the Pacific coast of Colombia and the associated “trans-Colombia” pipeline.44 Contemplated extensions of each may connect not just coal- and oil-producing regions in the east of Colombia, but ultimately Venezuelan resources and 

markets to the Pacific coast across Colombia. Yet other projects driven by this 

logic include improved highway connections over the Andes Mountains between 

Argentina and Chile45 and a possible Russia-funded rail line across Nicaragua 

from Monkey Point to Corinto.46

The transformation of the region’s infrastructure also includes the expansion of the Panama Canal, driven in part by the economic logic to accommodate larger volumes of larger ships transiting from Asia to and through the Americas, as well as repeated attempts to develop a second canal through Nicaragua.47

The net result of the new infrastructure is a region that is more connected, and whose interior is more accessible. While this has positive implications 

for commerce and state presence, it also proliferates opportunities for criminal 

activities, making remote jungle areas more accessible for narcotics labs, illegal 

loggers, and other activities, while bringing previously isolated indigenous tribes 

and other groups into greater contact with others in the region.

The Diminishing Weight of the US in Latin American Politics

Latin Americans are giving ever less importance to the United States with respect to their domestic political environment. In a 2011 Latinobarómetro survey, 

just 10 percent of respondents ranked the United States as the country most 
20 The Strategic Dimension of Chinese Engagement with Latin America

exerting leadership in the region, with just 3 percent of Uruguayans, 2 percent 

of Argentines, and 1 percent of Chileans ranking the US as most influential.48

At the level of Latin America’s leadership, such diminished importance 

of the US was evidenced by broad support in the region for the formation of 

new multilateral institutions exclusive of the US, including the Union of South 

American Nations (UNASUR) and the Community of Latin American and Caribbean States (CELAC), as well as the “hijacking” of the May 2012 Summit of 

the Americas to discuss Cuba and the legalization of drugs—issues that the US 

almost certainly would have preferred not to be the center of the agenda. The 

declining weight of the US was also evidenced by the decision by newly elected 

Brazilian president Dilma Rousseff to travel to China long before meeting with 

her US counterpart, and the willingness of Colombia’s President Juan Manuel 

Santos to publicly embrace new economic and security ties with the PRC, and to 

advocate drug legalization after more than a decade of Colombia’s being the US 

key security partner and largest aid recipient in South America.

It is important to note that the PRC is not “competing with the US” for 

the loyalties of Latin American governments, as did the Soviet Union in the Cold 

War. The current dynamic is more indirect and subtle, and arguably more effective. On the one hand, as discussed in further detail later, the financial solvency 

of anti-US regimes is increasingly underwritten by Chinese loans, investments, 

and commodity purchases, giving them time and resources to work against the 

US agenda in the region. On the other hand, the rise of China as a global power, 

its potential role as a customer, investor, and loan provider, and the simultaneous 

economic stagnation and fiscal difficulties of the US, leads many Latin American 

nations to view the United States as but one partner among many, and not necessarily the most attractive one.

The New Divide between South America and Mesoamerica

Expanding interactions with the PRC increasingly highlights the difference between Mexico and the northern triangle nations of Central America, whose 

economies and political interests are closely tied to the United States, and the 

rest of Latin America, whose extra-hemispheric relationships are diversifying 

more rapidly, led by commerce with Asia. While Chinese goods have penetrated 

Mexico and Central America as extensively as other parts of the region, exports from these countries to the PRC, multi-billion dollar Chinese investments 

there, and the symbolic trappings of close political bonds with the PRC have 

not matched the levels found in South America. In trade terms, in six nations of 

South America, the PRC has surpassed the United States as the country’s number 

one or number two trading partner, while in Mexico, Honduras, Guatemala, and 

El Salvador, the United States retains the lead by a significant margin.49

With respect to Mexico and the northern triangle, the PRC has argu-
R. Evan Ellis 21

ably approached this area cautiously because of its geographic proximity to the 

US, and because five of the six nations in the hemisphere continue to diplomatically recognize Taiwan as the legitimate government of mainland China.50

Reciprocally, the relationship of these countries with the US has been reinforced 

by economic structures such as the North American Free Trade Agreement 

(NAFTA) and the Central American Free Trade Agreement (CAFTA), as well as 

remittances from families living in the US and other human and economic bonds. 

In the case of Mexico, the war against transnational criminal organizations launched by President Felipe Calderon in 2006 has deepened the country’s 

security relationship with the United States, while at the same time distracting 

the country from its traditional leadership role in Latin America.

While these dynamics have played out in Mexico and the northern triangle countries, South America’s relationship with the PRC has expanded significantly, thanks to the expanding business of exporting petroleum, minerals, 

and agricultural goods to Asia, plus investment and financial benefits from China 

that have particularly suited the political agenda of the ALBA countries and the 

developmental and supra-regional political agendas of Brazil.

The forces described in the preceding paragraphs have propelled South 

America in a very different direction from that of Mexico and the Northern Triangle states, with the former increasingly displaying a China-led “internationalism,” 

while the later remain bound to the United States in a relationship largely dominated by security and immigration issues.

The Rise of Brazil and Its New Strategic Interest in Its Neighbors

The coming of age of Brazil in the previous two decades as a dominant actor in 

South America with global aspirations has owed much to its expanding relationship with the PRC. Exports of iron and soy to China have funded a key part of 

Brazilian growth and helped it to escape the global recession of 2008–9. While 

the contribution of China to the rise of Brazil itself may be considered a “national 

level” impact, the manner in which engagement with China has impacted Brazil’s engagement with the rest of the region is analyzed here as a supranational 

impact. Funds from China, including the $10 billion loan to Petrobras in 2009, 

and the injection of another $7.1 billion into the Brazilian oil sector through 

Sinopec’s investment in Repsol Brazil,51 have played an important role in the 

development of the Brazilian oil sector. Moreover, as the Brazilian economy has 

grown, the new importance of Asia has increased Brazil’s interest in neighboring 

states—particularly Peru, which separates Brazil from the Pacific coast of the 

continent, as well as Panama, whose canal widening project has a powerful impact on the logistics costs of Brazil’s commerce with Asia.

Brazil’s growing strategic interest in its neighbors on the Atlantic coast 

is arguably also associated with its expanding commerce with Asia. The export 
22 The Strategic Dimension of Chinese Engagement with Latin America

of soy and other agricultural goods from the interior of Brazil via the Paraguay 

and Parana river corridors adds strategic importance to Brazil’s relationship with 

Paraguay and Argentina, through which those rivers flow, while Surinam and 

Guyana provide access to the vast tract of jungle in the north of Brazil, which the 

Brazilian government has traditionally regarded as a potential object of foreign 

encroachment. For this reason, the $6 billion project to expand the port of Paramaribo and build a road from the port into the north of Brazil52 has strategic as 

well as commercial importance for the country.

The Extended Life of ALBA and Its Shadow over the Region

Although the Chinese state has been very careful not to associate itself with the 

anti-Western agenda of ALBA, the funds and planning support provided by its 

banks and the products and investment of its companies have allowed regimes 

such as those of Venezuela and Ecuador to avoid financial insolvency while consolidating and seeking to expand their revolution.

In the case of Venezuela, the $46.5 billion in loans provided by China 

Development Bank and the Industrial and Commercial Bank of China (ICBC)53

not only provided liquidity to the Chavez regime to fund its social programs 

without having to address rampant corruption and mismanagement, but has also 

paid for Chinese products and services that have helped the Chávez regime meet 

near-term political challenges. Such support included credit to purchase 3 million Chinese Haier-brand appliances to distribute as part of the state social program “mi casa bien equipada.”54 Similarly, Chinese loans funded construction work 

on thermoelectric and hydroelectric power plants in January 2010 when the 

government was confronted by political protests associated with power shortages and blackouts.55 Most recently, Chinese loans have funded construction of 

low-income housing by the Chinese company CITIC to help the Chavez regime 

overcome an acute housing shortage.56 Finally, Chinese loans are helping the 

Venezuelan government meet its portion of investment commitments to develop the oil and mining sectors, whose revenues ultimately generate the capital to 

keep the state afloat. Beyond the $38 billion in loans, however, is an additional 

$40 billion in potential future investment,57 including the development of the 

Junin-4, Junin-1, and Junin-8 oilfields, MP3, Boyaca-4,58 and the Mariscal Sucre 

offshore gas deposits, without whose revenues it would be increasingly difficult 

for Venezuela to meet its future commitments, and pushing China’s contribution 

to the Chávez regime toward almost $80 billion. In June 2013, China agreed to 

expand funding of the joint Chinese-Venezuelan company for the production of 

petroleum by an additional $4.25 billion.

While these impacts primarily occur at the national and subnational 

level, they also have supranational impacts, to the extent that they enable the 

continuity of Venezuela’s role as the leader of the “Bolivarian Socialist” movement 
R. Evan Ellis 23

in the region, and other direct and indirect influences on its neighbors, including 

its impact on the politics of the Caribbean through the oil subsidy program “Petrocaribe”; the programs of the Venezuelan-led ALBA block; Venezuela’s role in 

persuading Ecuador and Bolivia to purchase Chinese military and space technology; and Venezuelan support for left-oriented political movements throughout 

the region. Supranational effects also include the role of the China-Venezuela 

relationship as a “model,” illustrating to other countries in the region that Chinese loans and capital may be used as a “substitute” for Western investors and 

financial institutions, if those governments choose to pursue policies in opposition to these entities, such as loan defaults, radical changes in terms for resource 

concessions given to Western investors, or the expropriation of their property. 

As in Venezuela, China has also supported the Ecuadoran government 

through a series of loans backed by oil deliveries,59 totaling over $9 billion since 

2009, including a $2 billion line of credit negotiated in January 2013.60 Loans 

include both direct lines of credit to the Ecuadoran oil company Petroecuador, 

as well as financing for work being done by Chinese construction companies 

on eight separate hydroelectric projects in the country, including Coca Coda 

Sinclair,61 Sopladora,62 Toachi-Pilaton,63 Termoesmereldas II,64 Minas San Francisco,65 Delsitanisagua,66 and Mazar Dudas.67 Indeed, more such initiatives in the 

pipeline include possible Chinese participation in the $10 billion “Refinery of 

the Pacific,”68 which may include assumption of a 30 percent equity stake in the 

project by China National Petroleum Corporation (CNPC).69

On the investment side, Chinese petroleum firms, including CNPC, 

have operated a series of oil blocks in the north of the country since 2005, and 

CNPC is currently one of at least four Chinese firms operating in the country.70

Such firms are positioned to take the lead in developing the new ITT oilfields 

underlying the environmentally sensitive Yasuni parkland when the government 

chooses to allow drilling there.71

In the mining sector, as noted previously, in July 2010 the Chinese company Tongling acquired the Ecuadoran assets of the Canadian company Corriente72 and, despite protests by environmental and indigenous groups,73 has begun 

work on the $1.4 billion “El Mirador” strip mine,74 in what could ultimately 

amount to $3 billion of new mining investment in the country.75

In Bolivia, although Chinese support has been more modest than in 

Ecuador and Venezuela, it has made a number of gifts of military and customs 

equipment, support for the development and launch of the country’s first satellite, a modest investment by Citic Gouan to develop mineral deposits in the 

Coipasa salt flats,76 as well as the Cachuela Esperanza77 and Multiple Rositas78

hydroelectric projects in the department of Santa Cruz.79 Moreover, interest 

from Chinese banks in loaning funds for the development of the El Mutún iron 

deposits has been an effective tool for the Bolivian government in its negotiation 
24 The Strategic Dimension of Chinese Engagement with Latin America

with the Indian firm Jindal, which recently was forced to withdrawal from its 

contract to develop part of the mineral fields.80

Even in Nicaragua, which does not have formal diplomatic relations 

with the PRC, Chinese companies, financed by loans from Chinese banks, have 

been chosen to finance a new $6 billion refinery at Puerto Sandino,81 as well as a 

long-discussed new canal from the Atlantic to the Pacific oceans, with a potential 

cost of $30 billion,82 and an array of other project in the telecommunications and 

space sectors discussed in a subsequent chapter.

When taken together, Chinese economic support for Venezuela, Ecuador, and Bolivia, however separate from the political activities of these regimes, 

has reshaped Latin America, providing the core regimes of ALBA with the funds 

required in the short term to persist in their economic policies and political 

projects. At the regional level, as noted previously, this has translated into support for complimentary political and social movements in other Latin American 

countries, impact on the economies and politics of the Caribbean through Petrocaribe, lesser impacts on South America through the regional media organization 

Telesur and the regional banking organization Bancosur, as well as the facilitation 

of Iranian entry into the region.83 It has also served as an indirect enabler for 

the promotion by the ALBA countries of a family of supranational institutions 

exclusive of the United States, UNASUR, and CELAC, which the Venezuelan 

government of Hugo Chávez played an important role in founding.

The New Atlantic-Pacific Split

Perhaps the greatest impact of the PRC has been to inadvertently advance the 

emerging split between nations of the Pacific coast of Latin America, and those of 

the Atlantic. While the dichotomy has its exceptions (e.g., Ecuador), the states of 

the “Pacific” have generally adopted a pro-market, free-trade approach in relation 

to the opportunities and challenges represented by the emergence of the PRC 

as an economic actor in the region. Their approach has generally emphasized 

lowering tariffs and transaction costs, generating a stable and predictable investment environment to both attract Chinese investment and trade and serving as a 

bridge between Asia and other parts of the hemisphere.

The new “Pacific Alliance,” which, as noted previously, held its foundational meeting in June 2012 is the clearest manifestation of this new grouping, 

with Mexico, Colombia, Peru, and Chile as full members, and Panama and Costa Rica as “observers” that could choose to join at a later time. It is illustrative 

that all three of the Latin American states to have signed free trade agreements 

with the PRC (Chile, Peru, and Costa Rica) are found in this group, as well as 

Colombia, which recently announced its intentions to begin negotiating such an 

agreement.84 It is also important to note that the new Pacific Alliance signatories 

have made significant progress in a very short time in agreeing to specific types 
R. Evan Ellis 25

of collaboration and common structures in areas related to commerce with China, such as trade promotion and investment protection.85

By contrast to the new “Pacific Alliance,” the states on the eastern side 

of Latin America face the PRC with decidedly less market-oriented approaches. 

This includes Brazil and Argentina, which have each raised tariffs and have taken 

other measures to block the entry of Chinese and other goods into their markets. 

It also includes Paraguay, which remains largely frozen in diplomatic and economic isolation, as well as Bolivia and Venezuela, each of which have prioritized 

the state over the private sector in national development.

Such differences do not imply that the states of the Pacific alliance will 

automatically “outperform” the rest vis-à-vis China. Indeed, the substantial markets and resource endowments of the Atlantic-facing states may attract more 

Chinese loans and investments than their Pacific-facing counterparts. Yet whatever the near-term outcome, a rift of economic, and to an extent, political ideology is forming down the center of the South American continent that is only 

likely to deepen as the continent expands its relationship with the PRC.

Strategic Implications

It is important to acknowledge that the transformation of Latin America is driven by a number of factors associated with globalization and the emerging new 

world order, and is not caused by China alone. Nor does it suggest that such 

impacts are deliberate or reflect nefarious intent. As noted previously, the seeking of secure sources of supply by Chinese companies may be interpreted as 

the pursuit of legitimate strategic objectives, and the attempts by the Chinese 

government to coordinate this process is an understandable, if often imperfect, 

exercise of statecraft. Nonetheless, the rise of the PRC and its engagement with 

Latin America as one region among many in which it is engaged has played, and 

will continue to play, a role in the trajectory of Latin America. Chinese trade and 

investment with Latin America is changing the economic and social structure 

of the countries of the region and permeating the prevailing discourse, from 

students to business executives to political leaders. Chinese companies are increasingly present on the ground in Latin America, impacting and impacted by 

decisions taken by governments of the region. At the supranational level, both 

the reality and the concept of China is impacting the way nations of the region 

relate to each other, from sustaining the block of Bolivarian socialist countries, 

to shaping Brazil’s engagement with the region, to accentuating north-south and 

Atlantic-Pacific splits in the politics and economics of the region.

Sustainability of Chinese Engagement with Latin America

Lethargic growth rates in the US and Europe for the foreseeable future mean that 

the PRC must adapt its economic strategy if it is to sustain high rates of growth 
26 The Strategic Dimension of Chinese Engagement with Latin America

that its own leadership has said is important for maintaining domestic order.86

In the short run, this probably means even greater emphasis on dynamic middle-income markets such as those of Latin America, and, by extension, growing 

alarm and resistance from threatened sectors. The prospect of a new global financial crisis also looms large, with the debt-driven collapse of the old European 

order. Chinese banks, already carrying significant questionable debt from their 

participation in the infrastructure-oriented stimulus package associated with the 

last global financial crisis, would be unlikely to sustain their demand for capital 

goods as it did in November 2008 with its $586 billion infrastructure-oriented 

internal stimulus package. In the face of a new global recession thus, by contrast 

to that of 2008, Chinese demand would probably be unable to shield the nations 

of South America from a drop in commodity demand and associate prices, seriously impacting the region and calling into question the perception that its ties 

with the PRC “insulates” it from the vagaries of the developed nation economies. 

Nonetheless, even if a global financial crisis is avoided, over the long run, China 

must transition away from an export-led growth model to one more driven by 

internal demand. 

If this transition is successful, the political and economic implications 

for Latin America would be highly positive, with the invasion of inexpensive Chinese goods gradually giving way to collaborative production of globally destined 

products, as well as greater opportunities for Latin American companies to sell 

to a now substantial PRC middle class. At the same time, however, although a 

new generation of industrializing nations would probably sustain the mantle of 

commodity demand, it is likely that Latin America’s primary product revenue 

stream would fall off to some degree.

On the other hand, there is no guarantee that China’s transition to an 

economic model more reliant on internal demand, walking a tightrope between 

economic crises in Europe and the United States, will succeed. An important 

study by the International Monetary Fund released in January 2013, for example, argues that the demographic limits of an aging Chinese population could, in 

itself, bring China’s high rates of growth, fueled by the incorporation of labor 

into the modern economy, to a halt within a decade.87 Complications can also be 

anticipated from a swell of ethnic violence, or a new internet-fed democratization movement turned violent and chaotic. In short, the PRC may succeed in its 

transition to a more sustainable, internally driven economic model, but there are 

no guarantees.

If China’s transition to an economic model more reliant on internal 

demand fails, Latin America will be among the casualties, including the possibility of a China-led global financial crisis, a significant loss of dynamism in commodity export markets, and the drying up of Chinese loans for Latin American 

infrastructure projects. Those regimes that have most ardently defied Western 
R. Evan Ellis 27

markets and financial institutions would be among the hardest hit.

The purpose of this chapter has been to move beyond the prevailing discourse over whether China represents an opportunity or a threat to the nations 

of Latin America, and understand the fashion in which it is impacting the region. 

It has argued that such impacts are neither, necessarily, deliberate or nefarious, 

but nonetheless, that engagement is affecting both the discourse and the socioeconomic structures of the countries with which it engages, and transforming 

the manner in which those countries relate to each other. Although there are 

many possible outcomes, in the metaphor first postulated at the beginning of 

this article, the PRC is both the panda and the dragon, offering both win-win 

trade and investment options, while also threatening the region’s socioeconomic 

stability and US strategic interests. The mixture of outcomes will depend on the 

skill and wisdom with which Latin America manages these challenges.

Notes

1 This chapter is expanded and updated from the publication R. Evan Ellis, “Beyond 

Win-Win and the Menacing Dragon: How Engagement with China is Transforming Latin 

America” (Center for Hemispheric Policy, University of Miami, January 31, 2013).

2 Survey and other statistical data is employed where available, but in general, the arguments flow from my own experiences and research, as I have followed China’s expanding 

engagements over the past eight years and have conducted first-hand interviews and 

research in the majority of countries in the region. Correspondingly, the responsibility 

for any errors in fact and leaps in logic are mine alone.

3 See, for example, Kevin Gallagher and Roberto Porzecanski, The Dragon in the Room

(Stanford: Stanford University Press, 2008).

4 PEW Global Attitudes Project Question Database, PEW Research Center, accessed 

June 19, 2012.

5 For a country-by-country list of emerging Chinese language and China studies programs in Latin American universities as of 2008, see R. Evan Ellis, China in Latin America: 

The Whats and Wherefores (Boulder: Lynne Rienner Publishers, 2009). 6 Survey by author, unpublished, 2012. 7 “1st Confucius Institute Opens in Latin America,” Xinhua News Agency (February 16, 

2006).

8 “Confucius Institutes in Latin America,” Universidad de Granada, accessed June 19, 

2012.

9 “Acceso Restringido,” América Economía no. 402 (August 2011). 10 “OXY Argentina Deal Closed,” Sinopec official website, accessed December 9, 2011. 11 See, for example, Enestor Dos Santos, “Will the Emergence of China Deindustrialize 

Brazil?” BBVA (October 20, 2010). 12 Chinese companies have generally acquired rights to mines and oilfields through acquisitions, negotiating with governments only where there was already a strong political 

relationship (e.g.,Venezuela) or an established presence in the sector (Brazil with respect 
28 The Strategic Dimension of Chinese Engagement with Latin America

to the working relationship with Petrobras).

13 Interview with Ponce de Leon, Mansrovar Energy, Ltd. (Bogotá, Colombia, January22, 2010).

14 “Vicepresidente les exige a las Farc liberar a tres ciudadanos chinos,” El Tiempo (Bogotá, Colombia, June 10, 2011).

15 “Operadoras chinas dominan negocio petrolero ecuatoriano,” El Universo (Guayaquil, 

Ecuador, November 3, 2009).

16 Kevin P. Gallagher, Amos Irwin, and Katherine Koleski, “The New Banks in Town: 

Chinese Finance in Latin America” (Tufts University, February 2012).

17 “Venezuelan Consumers Line Up to Buy China’s Locally Assembled Chery,” China 

Post (Taipei, Taiwan, March 12, 2012). 18 “La china Lifan compra la uruguaya Effa,” Reuters (August 3, 2012). 19 “Brazilian Company Effa Motors to Manufacture Vehicles of China’s Harbin HF Automobile Industry Group Co., in Brazil,” Macau Hub (April 27, 2012). 20 “China’s Huawei Invests US$300 million in Research Centre in Brazil,” Macau Hub

(April 12, 2011).

21 Yun-Hee Kim, “ZTE to Invest in High-Tech Industrial Park in Brazil,” ZTE official 

website (April 13, 2011).

22 For protests in Jamaica over failure to hire local workers, see Kimmo Matthews, 

“Angry Protesters Demand Jobs on Palisades Project,” Jamaica Observer (Kingston, Jamaica, September 22, 2010).

23 The Shougang Hierro mine in Marcona and the Sinohydro dam project in Chone 

Ecuador, among others, have been the object of environmental protests. See “Rio Grande 

no vende ni compra en cantón Chone,” El Universo (Guayaquil, Ecuador, November 12, 

2011). The Sierra Grande mine in Argentina was shut down for over a year because of 

water supply issues. Francisca Pouiller, “Storm Erupts over Production Halt at Sierra 

Grande Mine,” Mining Weekly (June 26, 2009). 24 Krystel Rolle, “8,000 Jobs in Jeopardy?” The Freeport News (November 20, 2010). 25 Ianthia Smith, “Gov’t Told ‘Block’ Hutchison,” Jones Bahamas (October 29, 2009). 26 “Detienen a mujeres que protestan por contrato minero en embajada china en Quito,” El Universo (Guayaquil, Ecuador, March 5, 2012). 27 “Indígenas volvieron a demostrar su capacidad para la movilización,” El Universo

(Guayaquil, Ecuador, March 25, 2012).

28 “Oil Palm Industry Projected for Nickerie,” Stabroek News (February 13, 2012). 29 While it is difficult to find cases where “China” has become the defining issue between political candidates in Latin America, it has become integrated in the political 

discourse.

30 “Marisol Espinoza canalizará al Congreso pedidos de mineros de Shougang,” Andina

(September 8, 2011).

31 Kimmo Matthews, “Angry Protesters Demand Jobs on Palisadoes Project,” Jamaica 

Observer (Kingston, Jamaica, September 22, 2010). 32 “Envíos a China por acuerdos suman 200 mil barriles al día,” El Universal (Caracas, 

Venezuela, February 29, 2012).

33 “Petrolera china desestima que protesta en Tarapoa haya afectado sus intereses,” El 

Universo (Guayaquil, Ecuador, November 14, 2006.
R. Evan Ellis 29

34 “Heridos 24 militares en incidentes en protestas en Orellana,” El Universo (Guayaquil, 

Ecuador. July 5, 2007).

35 “Chinese Company Loses Millions as Protest Continues in Guyana,” Stabroek News

(August 7, 2012). See also “Hamstrung by Linden Unrest, Bosai Fears Loss of Markets,” 

Stabroek News (August 8, 2012). 36 “Ladrones cargaron con Bs 650 mil de empresa china en Venezuela,” El Universal (Caracas, Venezuela, December 16, 2012).

37 “Gushers and Guns: A Boom, and Threats to It,” The Economist (March 17, 2012). 38 “Colombian ‘Farc Rebels’ Blow Up Bridge in San Vicente,” BBC News (July 20, 2012). 39 “Emerald Energy Suspends Operations in Southern Colombia Following Rebel Attacks,” Colombia Reports (March 6, 2012). 40 “Vicepresidente les exige a las Farc liberar a tres cuídanos chinos,” El Tiempo (Bogotá, 

Colombia, June 10, 2011). The kidnapped Chinese workers were finally released by the 

FARC in November 2012. “Liberados por las Farc viajarían a China el lunes,” El Tiempo

(Bogotá, Colombia, November 22, 2012). Nor was this the first experience of Chinese 

oil companies in dealing with rebel groups in Colombia. In 2009 former Colombian 

congressman Oscar Tulio Lizcano alleged, in a book written about his time in captivity 

with the guerillas, that he had observed CNPC helicopters ferrying supplies and medical 

personnel to the FARC guerilla camp where he was being held. “Lizcano dice que petrolera daba apoyo logístico a las Farc,” Tierra (Bogotá, Colombia, July 15, 2009). 41 “Gushers and Guns,” The Economist. 42 Luis Bitencourt, former Director of the Center for Strategic Studies, Secretariat for 

Strategic Affairs (CEE/SAE), Government of Brazil, Washington, DC (July 19, 2012).

43 “Inauguran el penúltimo tramo del Corredor Bioceánico,” Bolpress (June 18, 2012). 44 “Pdvsa y Ecopetrol crearan empresa mixta para operar oleoducto,” El Universal (Caracas, Venezuela, October 24, 2012).

45 See, for example, Edgardo Guerci, “Túnel BiNaciónal de Agua Negra,”Presentation 

to the conference “Foro de Liderazgo para la Integración de América del Sur” (Cartagena, 

Colombia, December 2008).

46 “Is Russia Eyeing Dry Canal?” Nicaragua Dispatch (February 6, 2012). 47 The latest, $30 billion version of project was presented to the Nicaraguan legislature 

in June 2012 by the Sandinista government. Ramón H. Potosme, “Gobierno anuncia el 

Canal Interoceánico,” La Prensa (Managua, Nicaragua, June 6, 2012). 48 Informe 2011, Latinobarometro (Santiago, Chile, October 28, 2011). 49 Direction of Trade Statistics Yearbook 2011, International Monetary Fund. 50 The problem is compounded by the absence of well-organized primary product export industries in these countries with goods to sell to the PRC.

51 “Sinopec to Invest $7.1 Billion in Repsol’s Brazil Unit,” Bloomberg (October 1, 2010). 

Other deals, such as the $3.1 billion acquisition of Statoil’s Peregrino field by CNOOC, 

Sinopec’s acquisition of a 30 percent stake in Galp, and its January 2012 acquisition of 

two deepwater oil blocks from Perenco should not be considered investment in Brazil, 

because the capital was not injected into the Brazilian oil sector, but used to acquire 

ownership rights that could be used in a possible later investment.

52 Mark McGowan, “Suriname’s Deep Sea Port, Road and Rail Link to Brazil Challenge 

Guyana’s Bid to Become Brazilian Gateway,” Stabroek News (Georgetown, Guyana, De-
30 The Strategic Dimension of Chinese Engagement with Latin America

cember 12, 2010).

53 Anatoly Kurmanev and Stephen Bierman, “Chavez Cancer Freezes Venezuela’s Overseas Oil Funding,” Bloomberg (January 25, 2013). 54 “Programa Mi Casa Bien Equipada ha vendido 850 mil equipos,” El Universal (Caracas, Venezuela, January 7, 2012).

55 The thermoelectric facilities to be constructed in Venezuela by Chinese companies 

include the 772 MW facility El Palito in Carabobo and a 200 MW facility in Aragua by 

Sinohydro, the 500 MW El Vigia facility in Merida by CAMCE Engineering, a 412 MW 

facility in Carabobo by Sinohydro, another 412 MW facility in Zulia by Sinohydro, and 

a 360 MW facility in Zulia also by Sinohydro. The 600 MW facility in Carabobo will be 

rehabilitated by the Chinese firm CMEC. See “China otorga $20 millardos para financiar 

obras en Venezuela,” El Universal (Caracas, Venezuela, April 18, 2010). 56 “Bienvenido, Mister Jintao,” El Universal (Caracas, Venezuela, March 17, 2012). 57 “Pdvsa y China invertirán $40 mil millones en la Faja,” El Universal (Caracas, Venezuela, December 3, 2010).

58 “China operará cuatro nuevos campos petróleos en Venezuela,” El Universal (Caracas, 

Venezuela, November 23, 2011).

59 “Crédito de banco chino va atado a la venta de crudo,” El Universo (July 3, 2010). 60 Mercedes Alvaro, “Ecuador in Talks With China’s CNPC for 30 percent Stake in Refineria del Pacifico,” Wall Street Journal Online (January 30, 2013). 61 “Para obra del Coca Codo se busca empresa,” El Universo (January 7, 2011). 62 In October 2011 the $672 million Sopladora hydroelectric project was awarded to 

the Chinese Gezhouba Group, with $571 million of the financing coming from China 

Development Bank. “Con China se oficializa crédito para segunda hidroeléctrica,” El Universal (Guayaquil, Ecuador, October 11, 2011). 63 In parallel with the negotiations for these projects, negotiations were continued for 

the completion of the Toachi-Pilaton hydroelectric facility. Under the new terms of the 

deal, the $517 million follow-on project was funded, in part, by the Russian consortium 

Inter Rao UES, with part of the work done by the Chinese firm China Water and Electric 

Corporation. “El financiamiento para Toachi Pilatón tropieza,” El Universo (Guayaquil, 

Ecuador, December 29, 2010).

64 “Ecuador promueve inversiones, comercio, y turismo en el norte de China,” People’s 

Daily (June 16, 2012). 65 This $506 million hydroelectric project was awarded to the Chinese company Harbin Electric. “Cuarta firma china para hidroeléctrica,” El Universo (Guayaquil, Ecuador, 

February 15, 2012).

66 The Chinese company Hydrochina was awarded an initial contract of $195 million in 

February 2012 for this Project in the province of Zamora-Chinchipe. Its ultimate value 

is calculated to be $477 million. See “Cuarta firma china para hidroeléctrica,” El Universo

(Guayaquil, Ecuador, February 15, 2012).

67 The company China National Electric Engineering Company was awarded a $45.5 

million contract for this Project. “38 empresas chinas están en las áreas estratégicas y 

construcción,” El Universo (Guayaquil, Ecuador, June 18, 2012). 68 “Avanza negociación con China para financiar refinería de Pacífico,” El Comercio (Quito, Ecuador, April 30, 2012).
R. Evan Ellis 31

69 Mercedes Alvaro, “Ecuador in Talks with China’s CNPC for 30 percent Stake in Refineria del Pacifico,” Wall Street Journal Online (January 30, 2013). 70 These were China National Petroleum Corporation (CNPC), Andes Petroleum, Petroriental, Sinopec, and CPEB Chanqing Petroleum.

71 Indeed, according to Ecuadoran government documents published by journalist Fernando Villavicencio, the development of the ITT oilfields may have already have been 

committed to Chinese companies. See Fernando Villavicencio V., Ecuador Made in China

(Quito, Ecuador, 2013): 177-178. See also “Catorce interesados en licitación de los campos ITT,” El Universo (April 24, 2007). 72 “Tongling Nonferrous, China Railway Take Over Corriente Resources,” Mining Bulletin (June 1, 2010). 73 “Marcha avanzó a Latacunga y está a 75 kilómetros de Quito,” El Universo (Guayaquil, 

Ecuador, March 20, 2012).

74 Diana Davila, “Ecuador firmará contrato minero con empresa China este lunes,” Confirmado (March 2, 2012). 75 “Ocho sectores concentran los mayores planes de inversión,” El Universo (March 10, 

2011).

76 Carlos Valdez, “China Explores Bolivian Lithium Investments,” Salon (March 19, 

2012).

77 “Empresa china revisará proyecto Cachuela Esperanza,” Los Tiempos (Cochabamba, 

Bolivia, December 13, 2012).

78 “Bolivia Pursues Hydro-power Deal with China,” Fox News (July 29, 2012). 79 Marcello Ballve, “Despite Nationalizations, Bolivia’s Resource Sector Attracts Asian 

Investors,” World Politics Review (August 9, 2012). 80 When Jindal’s relationship with the Morales government soured in 2008, Bolivian 

officials began publically talking with the Chinese about developing some part of the 

mineral field. “Bolivia Talking with China for El Mutún Development,” Economic Times

(January 7, 2008). See also “Exportación de hierro se trunca con salida de Jindal,” Los 

Tiempos (Cochabamba, Bolivia, December 28, 2012). 81 “Chinos construirán mega refinería en Nicaragua,” El Comercio (April 27, 2012). 82 “Nicaragua busca a Brasil, China, Rusia, y Venezuela para financiar canal,” Univision

(June 14, 2012).

83 “The Dragon in the Backyard,” The Economist (August 13, 2009). 84 Nick Israel, “Fiebre de TLC en Colombia ¿Es bueno o malo? / Opinión,” El Tiempo

(Bogotá, Colombia, June 1, 2012).

85 Andres S. Oppenheimer, “Fiebre de TLC en Colombia ¿Es bueno o malo? / Opinión,” Miami Herald (June 11, 2012). 86 Ananth Krishnan, “China Sets 7.5 Per Cent Growth Target, Stressing Stability,” The 

Hindu (March 5, 2012). 87 Mitali Das and Papa N’Diaye, “Chronicle of a Decline Foretold: Has China Reached 

the Lewis Turning Point,” IMF Working Paper No. WP/13/26. (International Monetary 

Fund, January 2013).

33

Chapter 3

The Question of Chinese Soft Power1

Introduction

As noted in previous chapters, the reemergence of China as a dominant global 

actor highlights longstanding ambiguities in US thinking regarding what constitutes national security. PRC policymakers have emphasized the “peaceful” nature 

of China’s rise and have generally avoided military or political actions that could 

be seen by the US as “threatening.” Nonetheless, the economic, institutional, and 

cultural battles through which the PRC has advanced its position have both leveraged and contributed to an erosion of the US strategic position globally. The 

advance of China and the multidimensional strategic challenge it poses to the 

United States is most effectively characterized by one of the most loosely defined 

and misunderstood buzzwords in the modern parlance: Soft Power.

The concept of “Soft Power” was introduced in 1990 by Harvard Professor Joseph Nye, who defined it as “a dynamic created by a nation whereby 

other nations seek to imitate that nation, become closer to that nation, and align 

its interests accordingly.”2 Although the term is used to refer to a range of concepts, the present article analyzes Chinese soft power in terms of the willingness 

of governments and other actors in the international system to orient themselves 

and behave in ways that benefit the PRC, because they believe doing so to be in 

their own interests.

Such a definition, by necessity, is incomplete. There are many ways in 

which other actors may decide that actions beneficial to the PRC are also in their 

own interests; they may feel an affinity for the Chinese culture and people and 

the objectives of its government; they may expect to receive economic or political benefits from such actions, or they may even calculate that the costs or risks 

of “going against” the PRC are simply too great.

Soft power is a compelling concept, yet operates through vaguely defined mechanisms In the words of Nye, “in a global information age...success depends not only on whose army wins, but on whose story wins.”3

 The implications 

of soft power in the contemporary environment are difficult to evaluate because 

they involve a complex web of interconnected effects and feedback in which the 

ultimate results of an action go far beyond the initial stimulus and the ultimate 

importance of influence go far beyond what is initially apparent.

This chapter examines Chinese soft power in the specific context of 
34 The Strategic Dimension of Chinese Engagement with Latin America

Latin America. The US has long exercised significant influence in the region, 

while the PRC has historically been relatively absent. Nonetheless, in recent 

years, China’s economic footprint in Latin America and its attempts to engage it 

politically, culturally, and otherwise, has expanded enormously. Understanding 

the nature and limits of PRC soft power in Latin America casts light on Chinese 

soft power in other parts of the world as well.

The Nature of Chinese Soft Power

In general, the bases of Chinese soft power differ from those of the United States, 

leading analysts to underestimate that power when they compare the PRC to the 

US on those factors that are the sources of US influence, such as the affinity of 

the world’s youth for US music, media, and lifestyle, the widespread use of the 

English language in business and technology, or the quantity of elites who have 

learned their professions in US institutions.

It is also important to clarify that soft power is based on perceptions 

and feelings, and not on objective reality. Although China’s current trade with 

and investment position in Latin America is still relatively limited compared to 

the US,4 its influence in the region is not so much based on the current size of 

those activities, but rather, on hopes or fears in the region of what it could be in 

the future.

Because perception, rather than reality, drives soft power, the nature of 

the PRC’s impact on each country in Latin America is shaped by its particular 

situation, hopes, fears, and prevailing ideology. The “Bolivarian socialist” regime 

in Venezuela looks to China as a powerful ally in its crusade against Western “imperialism,” while countries such as Peru, Chile, and Colombia view the PRC in 

more traditional terms as a very important investor and trading partner within 

the context of global free market capitalism.

Sources of Chinese Soft Power

The core of Chinese soft power in Latin America, as in the rest of the world, is 

the widespread perception that the PRC, because of its sustained high rates of 

economic growth and technology development, will present tremendous business opportunities in the future, and will be a power to be reckoned with globally. In general, this can be divided into seven areas: (1) hopes for future access 

to Chinese markets, (2) hopes for future Chinese investment, (3) the influence 

of Chinese entities and infrastructure in Latin America, (4) hopes for the PRC 

to serve as a counterweight to the US and Western institutions, (5) China as a 

development model, (6) affinity for Chinese culture and work ethic, and (7) the 

perception of China as “the wave of the future.”

In each of these cases, the soft power of the PRC can be identified as 

operating through distinct sets of actors: the political leadership of countries, the 
R. Evan Ellis 35

business community, students and youth, and the general population.

Hopes for Future Access to Chinese Markets

Despite China’s impressive rates of sustained growth, only a very small fraction 

of China’s 1.3 billion-person population is part of the “modern” economy, with 

the resources that allow them to purchase Western goods. Estimates of the size 

of the Chinese middle class range from 100–150 million people, depending on 

the income threshold used, although the number continues to expand rapidly.5

Although selling to Chinese markets is a difficult and expensive proposition, 

the sheer number of potential consumers inspires great aspirations among Latin 

American businessmen, students, and government officials. The Ecuadoran banana magnate Segundo Wong, for example, reportedly said that if each Chinese 

would eat just one Ecuadoran banana per week, Ecuador would be a wealthy 

country. Similar expressions can be found in many other Latin American countries as well.

In the commodities sector, Latin American exports have expanded dramatically in recent years, including Chilean copper exports, Brazilian iron, and 

Venezuelan petroleum. In Argentina, Chinese demand gave rise to an entire new 

export-oriented soy industry, where none previously existed. During the 2009 

global recession, Chinese demand for commodities, based in part on a massive 

Chinese stimulus package oriented toward building infrastructure, was perceived as critical for extractive industries throughout Latin America, as demand 

from traditional export markets such as the US and Europe fell off.

Beyond commodities, certain internationally-recognized Latin American brands, such as Jose Cuervo, Café Britt, Bimbo, Modelo, Pollo Campero, 

and Jamaican Blue Mountain coffee, sell to the new Chinese middle class, which 

is open to leveraging their new wealth to “sample” the culture and cuisine of the 

rest of the world. Unfortunately, most products that Latin America has available 

to export, including light manufactures and traditional products such as coffee 

and tropical fruits, are relatively uncompetitive in the PRC, and subject to multiple formal and informal barriers to entry.

Despite the rift between hopes and reality, the influence of China in this 

arena can be measured in terms of the multitude of businessmen who are willing 

to invest millions of dollars and man years of their time, and operate in China at 

a loss for years, based on the belief that the future of their corporation depends 

on successfully positioning itself within the emerging Chinese market.

The hope of selling products to the PRC has also powerfully impacted 

political leaders, seeking to advance the development of their nations. Chilean 

presidents Lagos, Bachelet, and to some degree Piñera, for example, made Sino-Chilean trade relations the cornerstone of Chile’s economic policy, signing 

the first free-trade pact between the PRC and a Latin American nation in No-
36 The Strategic Dimension of Chinese Engagement with Latin America

vember 2005. Peruvian President Alan Garcia made similar efforts to showcase 

that nation as a bridge to China when Peru hosted the Asia Pacific Economic Cooperation (APEC) summit in November 2008. Governments in the region have 

also invested significant sums of money in the China-related activities of trade 

promotion organizations such as APEX (Brazil), ProChile, ProComer (Costa 

Rica), Fundación Exportar (Argentina), y CORPEI (Ecuador), among others, as 

well as representative offices in Beijing, Shanghai, Guangzhou and other Chinese 

cities, with the objective of helping their nationals to place products in those 

countries. Latin American leaders, from presidents to mayors, led business delegations of hundreds of persons to the PRC and funded elaborate pavilions in 

Chinese culture and trade shows such as the Canton Trade Fair and the Shanghai 

World Expo in an effort to help their country’s businessmen sell products in the 

PRC.

Hopes for Future Chinese Investment

China’s combination of massive, sustained trade surpluses and high internal savings rates give the PRC significant resources that many in Latin America hope 

will be invested in their countries. Chinese President Hu helped to generate 

widespread awareness of the possibility of Chinese investment in the region 

during his trip to five Latin American countries in 2004, specifically mentioning 

tens of billions of dollars in possible investment projects. A public controversy 

over whether his use of the figure $100 billion was actually referring to trade or 

investment has only called more attention in Latin America to China as a potential source of funds.

Although the expected Chinese investment was initially slow to materialize, today, thanks to China’s growing familiarity with doing business in Latin 

America and its enormous financial reserves (including a foreign currency surplus that had reached $3.3 trillion by September 2012),the PRC has begun to 

loan or invest tens of billions of dollars in the region. This included more than 

$38 billion in loans to Venezuela for public spending and infrastructure projects 

and more than $40 billion in investment commitments; more than $8 billion 

in loans to Ecuador; a $10 billion loan to Petrobras for the development of its 

offshore oil reserves; more than $10 billion in acquisitions in Brazil’s petroleum 

sector and $1.7 billion in investments in the country's power infrastructure; $10 

billion to Argentina to modernize its rail system; a $1 billion Urea plant and 

$5.6 billion in acquisitions in the Argentine Petroleum sector, including both 

Occidental Petroleum and Bridas; and more than $10 billion in commitments to 

develop Peruvian mines, including Toromocho, Rio Blanco, Galleno, and Marcona, just to name a few.6

For Latin America, the timing of the arrival of the Chinese capital magnified its impact, with major deals ramping up in 2009, at a time in which many 
R. Evan Ellis 37

traditional funding sources in the region were frozen because of the global financial crisis. Moreover, as Sergio Gabrielli, then president of the Brazilian national 

oil company Petrobras has commented, China is able to negotiate large deals, 

integrating government and private sector activities in ways that US investors 

cannot.7

Influence of Chinese Entities and Infrastructure in

Latin America

Although the presence of Chinese corporations and workers in Latin America 

pales by comparison to that of the US, it is growing, and exerting an increasing 

weight in select countries.

Particularly in states such as Ecuador and Venezuela, Chinese corporations are becoming increasingly indispensable for the functioning of the extractive industries that generate significant portions of the state’s revenue As 

noted previously, more than 38 companies are operating in the ground in Ecuador, including the principal non-Ecuadoran producers in the oil sector, the 

builders of eight major new hydroelectric projects: Coca Coda Sinclair, being 

worked by Sinohydro; Sopladora, being done by the Gezhouba Group; Toachi-Pilaton, being worked by China Water and Electric; Minas San Francisco8

 and the 

Termoesmereldas II project, 9 both being done by the Harbin Electric Company; 

and Delsitanisagua, Mazar Dudas, and Quijos, all being done by Sinohydro.10 

In Venezuela, Chinese companies are one of the key actors maintaining oil production in the mature oilfields of Lake Maracaibo and Anzoátegui, a 

key current revenue stream for the Chávez regime. In the Orinoco belt in the 

south of Venezuela, Chinese investment, technology, and manpower, including 

Chinese-made drilling rigs, are a key to the development of Venezuela’s future oil 

potential, including the Junin-4, Junin-1, Junin-8, MP-3, and Boyaca-3 oil blocks 

and the Mariscal Sucre gas fields, while a May 2010 agreement makes Chinese 

companies key players in the extraction of Venezuelan iron, gold, bauxite and 

coal.11

Even beyond the countries of ALBA, Chinese companies are playing 

an ever greater role in national economies. More than 80 Chinese companies 

are present in Peru, for example, including five mining operations which are 

expected to contribute more than $10 billion in new investment in the country 

in the coming decade.12 In Mexico, 57 Chinese companies, and a total of 227 

companies with some Chinese ownership, were operating in the country as of 

October 2011.13

Although Chinese companies have yet to attain the level of “key employers” or occupy a significant position in most Latin American communities, 

they play a growing role in strategically important sectors in many Latin American countries, such as telecommunications, where the Chinese companies Hua-
38 The Strategic Dimension of Chinese Engagement with Latin America

wei and ZTE are increasingly important product, service, and infrastructure 

providers from Argentina to Venezuela, and most recently, Central America and 

the Caribbean, or in logistics, where companies such as China Shipping, China 

Overseas Shipping (COSCO), and Hutchison Whampoa play increasingly vital 

roles in Latin America’s foreign trade.

Ironically, Latin American Chinese communities have played a relatively 

limited role in this expanding influence. Although there are large, historically 

rooted Chinese communities in countries such as Peru, Ecuador, Panama, and 

Brazil, Chinese immigrants have traditionally sought to keep a low profile in 

their societies. The structure of these communities has also served to channel 

new Chinese immigrants into certain traditional occupations, such as restaurants, the retail sector, or farming, with the result that ethnic Chinese today have 

a relatively limited involvement in the emerging China–Latin America trade, 

even in key hubs for such trade, such as Colon, Iquique, or Ciudad del Este. 

Indeed, the expansion of Chinese communities in countries such as Trinidad, 

Suriname, Guyana, Venezuela, and Argentina, once “below the radar screen,” has 

fueled ethnic tensions with other communities and arguably contributed to perceptions in some quarters of the Chinese as a “threat.” 

Beyond commercial ties, the PRC is also taking on an increasingly important role in regional institutions, such as the Organization of American States 

(OAS), the Inter-American Development Bank (IADB), and the Caribbean Development Bank, as well as interacting with new regional institutions such as 

CELAC. Although the PRC has only observer status in the OAS, for example, its 

delegation is very strong contributor to the activities of the body.14 With respect 

to the IADB, China has leveraged its “seat at the table” as an opening for doing 

business in the region, such as the $10.2 billion currency swap with Argentina, 

which it signed on the sideline of the IADB’s annual meeting in March 2009. In 

addition, through its initial financial contribution to the IADB, the PRC became 

part of a special committee overseeing loans to highly impoverished countries in 

the region, affording it expanded contacts with and subtle pressures over countries that do not currently recognize the PRC diplomatically, including Haiti, 

Honduras, and Nicaragua.

Hopes for the PRC to Serve as a Counterweight to the US and 

Western Institutions

China’s historical position as a “leader of the developing world” makes it the 

natural ally of the new generation of Latin American populist leaders, such as 

Rafael Correa, Evo Morales, and the late Hugo Chávez. During his first trip to 

Beijing after being elected president, for example, Evo Morales proclaimed himself 

to be a “great admirer of Mao.”15 During his September 2011 trip to the PRC,

Evo Morales proclaimed that “China is a country so great that from here, I can 
R. Evan Ellis 39

imagine that within a short time, the United States will be a colony of China.”16

Similarly, Hugo Chávez exclaimed that Mao and South American revolutionary 

icon Simon Bolivar would have been “great friends.”17 While these leaders may 

primarily be seeking Chinese investments and commodity purchases, the position of the PRC as a geopolitical “alternative” to the US shapes the way that they 

court the Chinese.

In permitting such hopes, the PRC has, to date, been very careful not 

to associate itself directly with the anti-US activities or rhetoric of these regimes, 

so as not to damage its strategically important relationship with the US and the 

West.18 Nonetheless, the relationship cannot avoid some flavor of the relationships between the Soviet Union and its Latin American client states during the 

Cold War. Bolivia turned to China to purchase K-8 combat aircraft, for example, 

after the US blocked it ability to procure aircraft from the Czech Republic.19

The PRC as a Development Model

The tremendous, sustained economic growth that the PRC has enjoyed since 

opening up to the world in 1978, has caused many in Latin America to look 

to China’s integration of capitalism and authoritarian politics as a development 

model, even while the US combination of liberal democracy, free markets, and 

privatization is increasingly seen as ineffective for solving the region’s endemic problems, such as corruption, poverty, and inequality. For traditional Latin 

American elites, the Chinese model is particularly attractive because it suggests 

that it is possible to achieve prosperity and growth without relinquishing political power.

As with other Chinese sources of soft power, the impact of the “Beijing 

Consensus” in Latin America relies on perceptions rather than realities; differences between the two regions make the Chinese success story difficult to repeat in Latin America, including the obedience to authority in the Chinese work 

culture, Chinese willingness to save rather than spend, and another part of the 

world serving as the market for Chinese exports.

Affinity for Chinese Culture

The PRC has actively promoted Chinese culture and language throughout the 

world, by contrast, including such landmark events as the 2008 Olympics in 

Beijing, and the 2010 World Expo in Shanghai, visited by an estimated 5 million foreign tourists,20 as well as establishing almost 300 Confucius Institutes 

worldwide, including 21 officially listed in Latin America.21 Cultural exchanges 

are a featured part of China’s interactions with Latin America, consistent with 

the “non-threatening” character that Beijing wishes to emphasize in these interactions.

Despite PRC “marketing efforts,” in contrast to the global impact of US 
40 The Strategic Dimension of Chinese Engagement with Latin America

culture, Chinese culture is arguably one of the PRC’s weakest levers of soft power in Latin America, with interest in Chinese culture arguably reflecting, more 

than driving, China’s influence in the region. Although some Chinese culture, 

such as the Chinese basketball star Yao Ming, or the movie Crouching Tiger, Hidden Dragon, is reaching the Latin American mainstream, perceptions of Chinese 

culture in Latin America are generally very limited and superficial, often based 

on media reports or experience with ethnic Chinese living in those countries. 

Such perceptions are often mixed, including respect for the Chinese work ethic, 

a sense of mystery regarding Chinese culture, and often a sense of mistrust arising from the perceived differences of that culture, and commercial competition 

from Chinese products.

China as the “Wave of the Future”

Perhaps China’s greatest source of soft power is the most intangible. China’s 

emergence as a key global player is a phenomenon that has assumed almost mystical proportions within Latin America. The rapid growth in the PRC’s trade 

with and investment in Latin America, and the expansion of contacts at all levels, 

only reinforce the perceived significance of the “China’s rise,” as observed from 

Latin America.

In addition to the opportunity for commerce, Latin America’s belief in 

the rise of China and its globally transformational implications draws the attention of the people and leaders of the region to the PRC, and shapes their course 

of action. For Costa Rican president Oscar Arias, for example, establishing regular diplomatic relations with the PRC was a necessary part of ensuring the 

relevance of Costa Rica as an international actor.

At the popular level, the rise of China is arguably behind a swelling 

interest in the Chinese language in the region. The dedication of five or more 

years by students to gain a basic capability in the Mandarin language and its character set, for example, is arguably driven by their calculation that the ability to 

communicate in Chinese will be fundamental to the pursuit of opportunities in 

the PRC, and with Chinese businessmen and government officials, in the future.

While reports of slowing growth in China by the end of 2012 arguably 

deflated some of the more exaggerated of such proclamations, looming financial 

crises and stagnant growth in both Europe and the United States continued to 

make China’s more modest but still significant growth look good by comparison.

The Use of Chinese Soft Power

One of the most important questions associated with the rise of China is how it 

is likely to use its growing soft power, both in Latin America and elsewhere in 

the world. At a superficial level, China’s official rhetoric concerning nonintervention in the affairs of other states as a key principle of Chinese foreign policy22
R. Evan Ellis 41

suggests that they will not use it at all. Moreover, as China has engaged Latin 

America from a relative position of weakness during the past decade, it has been 

notably deferential when its commercial interests have been adversely impacted 

by the actions of Latin American leaders. To date, it has also maintained a relatively deferential attitude even when the lives of ethnic Chinese in the region 

have been threatened through protests and other actions. Such examples notwithstanding, however, this section argues that the imperatives for China to use 

its growing soft power in Latin America will come from the growing presence 

of Chinese companies and personnel on the ground there, with both the corresponding duty to protect them, and a growing capability and growing confidence 

in their ability to do so.

It is important to note that the manner in which the PRC exercises its 

soft power will likely differ markedly from the way that the United States has 

exercised influence in the region to date. This is both because the geopolitical 

situation under which the PRC would apply such influence is very different than 

that confronting the United States during the previous century, and also because 

the Chinese understanding of power and how to achieve objectives is very different, albeit not necessarily better or worse, than that of the United States.

Nonetheless, based on the Western understanding of Chinese national 

interests and the projection of future imperatives arising from their growing 

physical presence in the region, it is reasonable to suggest that the Chinese government is likely to apply its growing soft power to advance some combination 

of the following objectives: (1) diplomatic isolation of Taiwan, (2) access to Latin 

American markets, (3) promotion and protection of Chinese business activities 

and nationals in the region, and (4) working against the consolidation of US influence in the region and its institutions.

Although the Chinese government repeatedly states its commitment to 

noninterference in the internal affairs of partner nations, in reality the PRC is 

as interested in such issues as any other outside country. Only the issues that the 

PRC focuses on, and the ways in which China applies pressure, differ.

Diplomatic Isolation of Taiwan

For the PRC, the government of Taiwan represents an important issue of political 

legitimacy and internal security. Currently, 12 of the 23 nations in the world that 

diplomatically recognize the government of Taiwan are found in Latin America 

and the Caribbean. Although the PRC does not publicly threaten to block investment in or loans to countries that do not recognize it, it repeatedly emphasizes the issue in its public diplomacy in the region and makes such investments 

and market access very difficult for those countries, while simultaneously nurturing expectations regarding the opportunities that diplomatically recognizing 

the PRC could bring. When Costa Rica changed its diplomatic recognition from 
42 The Strategic Dimension of Chinese Engagement with Latin America

Taiwan to the PRC in May of 2007, for example, it received an aid package that 

included a $83 million soccer stadium, the purchase of $300 million in government bonds, the promise of highway, public works, and aid projects, and a billion 

dollar joint venture to expand the country’s petroleum refinery, as well as PRC 

aid in facilitating access to Chinese markets by traditional Costa Rican products 

such as coffee. In part, such Chinese generosity was directed toward the other 

countries in the region that still recognized Taiwan, in order to demonstrate the 

types of benefits there could be if they too were to change their diplomatic posture.23

Although the PRC and ROC have informally agreed to refrain from the 

use of economic incentives to competitively “bid” for diplomatic recognition, 

since Costa Rica’s switch the allure of the PRC has prompted declarations of 

interest in changing diplomatic posture by key leaders in virtually all states diplomatically recognizing Taiwan, including Panamanian president Richard Martenelli, then–Paraguayan president Fernando Lugo, Salvadoran President Maricio Fuenes, and Honduran President Porfirio Lobo—although each did so prior 

to assuming office.

Moreover, although the PRC and China have “honored” their diplomatic 

truce, ratified by the January 2012 reelection of Taiwanese president Ma Yingjeou and his nationalist KMT party, Chinese companies have made significant 

commercial advances in countries recognizing Taiwan, including a contract to 

the Chinese construction company Sinohydro for construction of a major hydroelectric facility in Honduras, a coal-fired power plant in Guatemala,24 and contracts for the launch of a satellite, construction of a refinery, and the initial stages 

of a $30 billion canal in Nicaragua, as well as Chinese investment in a major new 

resort, Punta Perla, in the Dominican Republic. Similarly, in Central American 

and Caribbean countries diplomatically recognizing the PRC, commercial interactions have gone far beyond symbolic gifts such as clinics and cricket stadiums, 

and now include major new construction projects, from the Freeport container 

port and the $3.5 billion Baha Mar resort complex in the Bahamas, to the $400 

million Jamaica infrastructure development program (JDIP), to the expansion of 

Guyana’s international airport, to multiple projects in Costa Rica from a solar 

power facilities,25 to the $1.5 billion upgrade of the refinery at Moin,26 to a segment of highway from the capital, San Jose, to the coastal town of Limón.27

Access to Latin American Markets

Latin American markets are becoming increasingly valuable for Chinese companies because they allow the PRC to expand and diversify its export base at a 

time in which economic growth is slowing in traditional markets such as the US 

and Europe. The region has also proven an effective market for Chinese efforts 

to sell more sophisticated, higher value-added products in sectors seen as stra-
R. Evan Ellis 43

tegic, such as autos, appliances, computers and telecommunication equipment, 

and aircraft. In expanding access for its products through free trade accords with 

countries such as Chile, Peru, and Costa Rica, and penetrating markets in Latin 

American countries with existing manufacturing sectors such as Mexico, Brazil, 

and Argentina, the PRC has often had to overcome resistance by organized, often 

politically well-connected established interests in those nations. In doing so, the 

hopes of access to Chinese markets and investments among key groups of businessmen and government officials in those nations has played a key role in the 

political will to overcome the resistance. In Venezuela, it was said that the prior 

Chinese ambassador to Venezuela, Zheng Tuo, was one of the few people in the 

country who could call President Chávez on the telephone, and get an instant 

response, if an issue arose regarding a Chinese company.

At times, China has also applied more explicit pressures to induce Latin 

America to keep its markets open to Chinese goods. It has explicitly protested 

measures by the Argentine and Mexican governments that it has seen as protectionist, and in the case of Argentina, as informal retaliation, began enforcing a 

longstanding phytosanitary regulation, causing almost $2 billion in lost soy exports and other damages for Argentina.28

China has also used its economic weight to help it to secure major projects on preferential terms. In the course of negotiating a $1.7 billion loan deal 

for the Coca Coda Sinclair Hydroelectric plant in Ecuador, the ability of the 

Chinese bidder Sinohydro to self-finance 85 percent of the projects through Chinese banks helped it to work around the traditional Ecuadoran requirement that 

the project have a local partner. Later, the Ecuadoran government publicly and 

bitterly broke off negotiations with the Chinese, only to return to the bargaining 

table two months later after failing to find satisfactory alternatives. In Venezuela, 

the Chávez government agreed, for example, to accept half of the $20 billion 

loaned to it by the PRC in Chinese currency, and to use part of that currency to 

buy what eventually amounted to 3 million consumer appliances from the Chinese manufacturer Haier, for the government social program mi casa bien equipada.

29 In another deal, the PRC loaned Venezuela $300 million to start a regional 

airline, but as part of the deal, required Venezuela to purchase the planes from a 

Chinese company.30

Protection of Chinese Business Activities and Nationals

As with the US and other Western countries, as China becomes increasingly involved in business and other operations in Latin America, an increasing number 

of its nationals will be vulnerable to hazards common to the region, such as kidnapping, crime, protests, and related problems. In June 2011, for example, three 

Chinese working for the petroleum services firm Great Wall Drilling were kidnapped in Caquetá Colombia31 and held by the Fuerzas Armadas Revolucionarios 
44 The Strategic Dimension of Chinese Engagement with Latin America

de Colombia (FARC) guerilla organization until November 2012.32 Similarly, 

the increasing presence of Chinese petroleum companies in the northern jungle 

region of Ecuador, for example, has been associated with a series of problems, 

including the takeover of an oilfield operated by the Andes petroleum consortium in Tarapoa in November 2006, and protests in Orellana related to a labor 

dispute with the Chinese company Petroriental in 2007, resulting in the death 

of more than 35 police officers, and forcing the declaration of a national state of 

emergency. Chinese operations including the Bosai mine in Linden, Guyana,33

the Rio Blanco mine in Piura, Peru,34 the Colquiri mine in Bolivia,35 and the Cerro Dragon gasfield in Argentina,36 among others, have similarly been the object 

of violent protests.

At the same time, as Chinese communities in the region have expanded in the region and have been linked in the public mind to China’s broader 

commercial expansion in their countries, tensions have risen with surrounding 

populations, occasionally giving rise to violent incidents. In 2004, ethnic Chinese 

shopkeepers in Valencia and Maracay, Venezuela, became the focus of violent protests associated with the Venezuelan recall referendum.37

In Argentina, in 2007, a group of truckers went on strike against the 

Chinese shopkeepers in greater Buenos Aires that they had previously supplied, 

based on accusations of mistreatment by those shopkeepers. Behind the strike, 

however, was a broader frustration that the Chinese had displaced ethnically 

Spanish grocery store owners who had previously dominated the neighborhood, 

and that their ability to do so was based on “unfair competition” by those shopkeepers, seen to be supplied and protected by the “Chinese mafia.”38

In Suriname, Chinese shopkeepers have similarly been caught up in 

ethnic violence with other ethnic groups in that country, including two major 

incidents in recent years: one on Christmas Eve 2009 in the city of Papatam,39

and a second in October 2011 in the town of Maripaston. Similarly in Guyana, 

in January 2013, a Chinese shop in the capital of Georgetown was attacked by a 

mob enraged over reports that its owner had beaten a young girl from the local 

community.40

In some cases, the line is blurred between violence against the Chinese 

community because of their Chinese identity, and violence against them for other causes. In Venezuela, with an estimated 180,000 Chinese residents, and which 

crime rate is among the highest in the region, an estimated 1,000 members of 

the community have been victimized by violent crime in recent years.41

As such incidents increase, the PRC will need to rely increasingly on 

a combination of goodwill and fear to deter action against its personnel, as well 

as its influence with governments of the region, to resolve such problems when 

they occur.
R. Evan Ellis 45

Blocking the Consolidation of US Influence in the Region and 

its Institutions

The rise of China is intimately tied to the global economy through trade, financial, and information flows, each of which is today highly dependent on global 

institutions and cooperation. Because of this, some within the PRC leadership 

see the country’s sustained growth and development, and thus the stability of the 

regime, threatened if an actor such as the US is able to limit that cooperation or 

block global institutions from supporting Chinese interests.

In Latin America, China’s attainment of observer status in the OAS in 

2004 and its acceptance into the IADB in 2009 were efforts to obtain a “seat at 

the table” in key regional institutions and to keep them from being used “against” 

Chinese interests. In addition, the PRC has leveraged hopes of access to Chinese 

markets by Chile, Peru, and Costa Rica to secure bilateral free trade agreements, 

whose practical effect is to move Latin America away from a U.S.-dominated 

trading block (the Free Trade Area of the Americas), in which the PRC would 

have been disadvantaged.

Finally, the PRC benefits from the challenges posed to the dominance 

of the US in the region by regimes such as Venezuela, Ecuador, and Bolivia, and 

its trade and investment with those regimes help to keep them economically 

viable. Nonetheless, the PRC is careful to avoid association with the anti-US 

rhetoric and projects of those regimes, which could damage its more strategically important relationship with the US.

Limits to Chinese Soft Power

The growth and exercise of soft power by the PRC has limits that are important 

to recognize. As with the sources of Chinese soft power, those limits are not 

the same as the limits to US soft power. Limits to Chinese soft power in Latin 

America principally arise from the significant gap between the two cultures, 

the associated difficulty in learning each other’s culture and language, a lack of 

understanding of each side by the other, and a pervasive sense of mistrust of the 

Chinese within Latin America generally.

The cultural gap between China and Latin America touches upon many 

areas, from differing consumer preferences limiting the appeal of Latin American exports such as coffee and beef, to different attitudes toward authority in 

business and administrative dealings, contributing to labor problems and other 

difficulties where the PRC has operated in Latin America.

One of the most significant barriers between the PRC and Latin America is language. Whereas a relatively significant portion of Latin Americans have 

some ability in English, very few speak or read Chinese, and even fewer Chinese 

can communicate in Spanish, although the number is growing.42 Although Chinese-language programs are proliferating in Latin America, the difficulty and 
46 The Strategic Dimension of Chinese Engagement with Latin America

time required to learn Mandarin and the Chinese character set is a powerful 

impediment to the growth of human ties between the two cultures, as is the very 

limited number of Chinese functionaries who can speak Spanish.

Compounding the language barrier is a relative lack of Chinese knowledge regarding Latin America and the Caribbean. Apart from major governmental institutes, such as the China Academy of Social Sciences (CASS), which 

currently has the world’s largest Latin America studies program, and truly multinational Chinese corporations such as Hong-Kong Based Hutchison Whampoa, 

China Shipping, China Overseas Shipping (COSCO), Huawei, and ZTE, the 

general knowledge of the region among Chinese businessmen and government 

functionaries is very limited, restricting the ability of the PRC to develop broad 

and sophisticated programs to advance its objectives in the region.

Perhaps most important, in Latin American despite the best efforts of 

Chinese businessmen and politicians to reach out, they are too frequently perceived as “not one of us...,” a reality reflected even in Chinese communities, 

which often remain only partly integrated, despite deep historical roots in many 

Latin American cities such as Lima and Guayaquil.

Such distance often translates into a persistent mistrust, even where 

both sides perceive benefits from cooperation. Latin American businessmen 

commonly express misgivings suggesting that the Chinese are aggressive and 

manipulative in business dealings or conceal hidden agendas behind their expressions of friendship and goodwill. Chinese companies in Latin America are often 

seen as poor corporate citizens, reserving the best jobs and subcontracts for their 

own nationals, treating workers harshly, and maintaining poor relations with the 

local community. In the arena of China–Latin America military exchanges, it is 

interesting to note that Latin American military officers participating in such 

programs are often jokingly stigmatized by their colleagues in ways that officers 

participating in exchange programs in the US are not.

Finally, Chinese influence is diluted by increasing interactions between 

Latin America and other extraregional actors, such as India, Russia, Iran, and 

others Although the PRC is arguably the most significant new suitor of the region, it is not the only alternative. For Nicaragua and populist regimes in the 

Andean region, Russia provides important alternatives with respect to arms purchases, and energy sector investments. An $18 billion commitment by a Russian 

consortium to develop the Junin-6 oilfield in Orinoco, for example, may have 

helped to accelerate China’s subsequent commitment to invest $16.3 billion in 

Junin-4. In addition to Russia, India is increasingly engaging in commercial opportunities, particularly in high tech, services, and commodity sector investments, while challenging the PRCs monopoly over “south-south” developing 

country partnerships in the region. When China cut off purchases of Argentine 

soy oil, for example, it was India that picked up the slack.
R. Evan Ellis 47

Chinese Learning

Despite the limits to Chinese soft power detailed in the previous section, as 

China deepens its engagement with Latin America, including the new physical 

presence of Chinese companies in the region, all sides will be in a phase of accelerated learning about the others. For the Chinese, such learning will increase the 

effectiveness and precision with which they are able to exercise soft power, both 

to avoid problems and to defend the interests of their companies and nationals. 

Chinese companies are learning how to work with the complex bureaucracies of 

the region, including participating in Western-style bid and proposal processes, 

and relating to Latin American labor forces, national and local governments, and 

communities. Sinologist Margaret Meyers argues, for example, that the Chinese 

experience with the political transition in Venezuela will teach Chinese investors 

to approach similar deals more cautiously in the future.43 Similarly, according to 

a Colombian diplomat, the experiences of the firm Sinohydro in Colombia have 

helped the firm to “master the inner workings of the Colombian 

parliament.” 44

Their ability to manage such interactions effectively will shape the 

degree to which the expanding engagement in the coming decades gives rise 

to conflict and stalemate, or whether Chinese and Latin partners are able to 

form constructive partnerships. By January 2013, for example, China’s Foreign 

Ministry spokesman, in announcing the PRC intention to strengthen ties with 

Latin America during 2013, was emphasizing China’s desire to “import American products of higher added value, in order to achieve...sustainable development,”45 indicating that the Chinese government had internalized and come to 

appreciate its relationship with the countries of Latin America.

In the end, thus, the ability of the PRC to manage the consequences of 

its expanding physical presence on the ground in Latin America, including the 

protection of its companies, workers, and interests, will likely reflect a balance 

between three dynamics simultaneously unleashed by that presence: expanding 

conflict and challenges, expanded soft power, and accelerated learning about 

how to use that soft power.

It is likely that there will not be one “resolution” of the impact of the 

new Chinese physical presence on the ground in the region, but rather, that the 

balance between conflict and harmony, China being seen in a positive versus a 

negative light, and other factors, will resolve itself in different ways, in different 

parts of the region, at different times, in a dynamic equilibrium that will constantly be in a state of evolution.

Strategic Implications

Analysts looking for signs of imminent Chinese coercion or intervention in Latin 

America are likely to be disappointed. Nonetheless, Chinese soft power in Latin 
48 The Strategic Dimension of Chinese Engagement with Latin America

America still raises important national security issues, even if the PRC does not 

explicitly seek to subvert or marginalize the United States as part of its reemergence onto the world stage, and even if that presence creates opportunities, as 

well as risks.

In Latin America, as elsewhere, China’s currently modest influence is 

providing it with triumphs of ever-growing scale in strategically important business, culture, and technology arenas. Although no specific event may directly 

threaten the US national interest, the collective effect is to restructure the global 

flows of value added and influence in a manner beneficial to China, making the 

ability of the US to successfully pursue its own national goals and interests increasingly dependent on the acquiescence of the PRC.

For analysts focused on the “rise” of China in Latin America and elsewhere, the issue is not whether China is a “threat” or whether it has the right 

to pursue its national interests in Latin America and other parts of the world. 

Rather, it is important to recognize the dynamics that this reemergence creates 

in a region with close human, geographical, and economic ties to the United 

States, and to prepare to mitigate the risks, meet the challenges, and rise to the 

opportunities that China’s entry into Latin America makes possible.

Notes

1 This chapter is expanded and updated from the essay R. Evan Ellis, “Chinese Soft 

Power in Latin America: A Case Study,” Joint Forces Quarterly issue 60 (1st Quarter 2011): 

85-91.

2 Joseph S. Nye, “Bound to Lead: The Changing Nature of American Power” (1990). 

The concept was also further refined in his subsequent book Soft Power: The Means to Success in World Politics (2004). 3 Joseph S. Nye, “The Rise of China’s Soft Power,” Wall Street Journal Asia (December 

29, 2005).

4 In 2009 PRC bilateral trade with Latin America, counting Cuba, was $111.5 billion, 

while US trade with the region was $530.0 billion, about 4.75 times larger. Direction of 

Trade Statistics, International Monetary Fund (June 2010). 5 Leslie T. Chang, “China’s Middle Class,” National Geographic (May 2008). 6 Li Qiaoyi, “Foreign Exchange Reserves Rise in Q3,” Global Times (October 14, 2012). 7 John Lyons, “Brazil Turns to China to Help Finance Oil Projects,” Wall Street Journal

(May 18, 2009)

8 “Cuarta firma china para hidroeléctrica,” El Universo (Guayaquil, Ecuador, February 

15, 2012).

9 “Ecuador promueve inversiones, comercio, y turismo en el norte de China,” People’s 

Daily (June 16, 2012). 10 “38 empresas chinas están en las areas estratégicas y construcción,” El Universo (Guayaquil, Ecuador, June 18, 2012).

11 “Venezuela exploitará hierro, acero, bauxita y oro con China,” official website of the 
R. Evan Ellis 49

Government of Venezuela, http://www.vtv.gob.ve. (May 16, 2010). 12 See Ding Qingfen, “Companies Still Drawn to Perú, Despite Obstacles,” China Daily

(December 11, 2012). See also “Hay más de 80 firmas chinas en el Perú,” Gestión (Lima, 

Peru. December 11, 2012).

13 Veronica Sanchez, “Llegan más chinos al País,” Reforma (October 9, 2011). 14 Alexander Ador Netto, Secretary for Multidimensional Security of the OAS, public 

comments as part of a panel on Chinese engagement with Latin America (George Washington University, April 6, 2010).

15 See also Mireya Tabuas and Maria Alesia Sosa,“No es un cuento chino,” El Naciónal

(Caracas, Venezuela, April 15, 2012).

16 “Evo anuncia siete convenios con China,” Los Tiempos (Cochabamba, Bolivia, August 

16, 2011).

17 Alberto Alemán Aguirre, “Relaciones que saben a petróleo,” El Nuevo Diario (Managua, Nicaragua, August 15, 2012).

18 “Pekín se desmarca de vínculo ideológicos con Venezuela a la llegada de Chávez,” El 

Universal (Caracas, Venezuela, September 23, 2008). 19 “Bolivia Builds Defenses against ‘Poachers’ of Resources,” UPI.com (August 9, 2010). 20 “The Shanghai World Expo Opens May 1,” China Digital Times (April 27, 2010). 21 Confucius Institute Online, official website, accessed February 4, 2013. 22 See, for example, “China’s Policy Paper on Latin America and the Caribbean (full 

text),” Government of the People’s Republic of China (November 2008).

23 For more details see R. Evan Ellis, China and Latin America: The Whats and Wherefores

(Boulder: Lynne Rienner Publishers, 2009):215–217.

24 “AEI’S Jaguar Energy Begins Construction of 300 MW Power Plant in Guatemala,” 

Business Wire (May 7, 2010). 25 Mercedes Agüero, “Chinos usarán luz solar de Guanacaste para generar energía,” La 

Nación (San Jose, Costa Rica, August 14, 2012). 26 China aprueba seguir con plan de refinería con Recope,” Nación (San Jose, Costa 

Rica, October 10, 2011).

27 “País pide a China donación para ampliar ruta Río Frío-Limón,” Nación (San Jose, 

Costa Rica August 2, 2010).

28 Rodrigo Orihuela, “Argentina Soybean Growers `Optimistic’ Talks Will End China’s 

Oil Blockade,” Bloomberg News (April 6, 2010). 29 “3 millones de equipos chinos para ‘Mi casa bien equipada,’” El Universal (Caracas, 

Venezuela. July 6, 2011). As of February 2011, the government had received 1.4 million 

of the appliances, and had sold 850,000 of them. See “Programa Mi Casa Bien Equipada 

ha vendido 850 mil equipos,” El Universal (Caracas, Venezuela, February 7, 2012). 30 “China prestará a Venezuela $300 millones para crear aerolínea,” El Universal (Caracas, Venezuela, April 24, 2010).

31 “Vicepresidente les exige a las Farc liberar a tres cuídanos chinos,” El Tiempo (Bogotá, 

Colombia, June 10, 2011).

32 The released workers were the last hostages believed to be held by the FARC. “Liberados por las Farc viajarían a China el lunes,” El Tiempo (Bogotá, Colombia, November 

22, 2012).

33 “Chinese Company Loses Millions As Protest Continues in Guyana,” Stabroek News
50 The Strategic Dimension of Chinese Engagement with Latin America

(August 7, 2012). See also “Hamstrung by Linden Unrest, Bosai Fears Loss of Markets,” 

Stabroek News (August 8, 2012). 34 See “Acusan al alcalde de Sapalache de apoyar violencia contra Río Blanco,” El Comercio (Lima, Peru, November 23, 2011). 35 “Colquiri aún dialoga y denuncian más tomas,” Los Tiempos (Cochabamba, Bolivia, 

June 9, 2012).

36 “‘Los Dragones’ y la PAE vuelven a negociar hoy,” TN (Buenos Aires, July 19, 2012). 37 Yolanda Ojeda Reyes, “Cuídanos chinos reciben protección,” El Universal (Caracas, 

Venezuela, November 11, 2004).

38 “Los camioneros ratifican el boicot a los súper y autoservicios chinos,” Clarin (Buenos 

Aires, Argentina, June 26, 2006).

39 See R. Evan Ellis, “Suriname and the Chinese: Timber, Migration, and the Less-Told 

Stories of Globalization,” SAIS Review volume 32, number 2 (Summer-Fall 2012): 85–97. 40 In that case, a mob attacked a Chinese store, provoked by word that a young afro-Guyanese girl had been beaten by the owner, who accused her of shoplifting. See 

“Mob Raids Store of Chinese Charged with Assault on Child,” Stabroek News (Jonestown, 

Guyana, January 10, 2013).

41 “Empresarios chinos, afectados por violencia en Venezuela,” Informador (Jalisco, Mexico, March 23, 2011).

42 In many business and technical interactions, English is used as the common language 

between Chinese and Latin Americans.

43 Margaret Meyers, “What Chávez Taught China,” Fletcher Forum of World Affairs (January 18, 2013).

44 Ibid. 45 “Chinese Foreign Ministry Spokesperson: China to Strengthen Ties with Latin America This Year,” CRI Online (January 28, 2013).
51

Chapter 4

Chinese Commercial Actities in

Strategic Sectors

Overview

As the relationship between the PRC and Latin America has expanded during the 

past decade, the main thrust of Chinese activities has been the acquisition of Latin 

American commodities and, reciprocally, the sale of manufactured goods to the 

region. While pursuing its immediate commercial objectives in Latin America, 

however, the Chinese government has also sought to manage these engagements 

strategically. In addition to using investment and finance to secure reliable access 

to key commodities, Chinese companies, with the help of the Chinese government, have also sought to move up the value-added chain, selling more sophisticated, higher value-added products to the region and building a presence in 

strategically important sectors such as autos, buses and trains, heavy machinery, 

computers and telecommunications, and military goods.

The presence of Chinese companies in high value-added, technologically sophisticated sectors such as telecommunications and space in Latin America 

may be regarded as having a doubly strategic character. On one hand, the expansion and accumulation of technological prowess by Chinese companies in these 

sectors benefits the modernization and diversification of the Chinese economy 

and its movement from competitiveness based on wages, to that based on the 

sophistication and capability of its products. In addition, however, capability by 

Chinese companies in these sectors, particularly in Latin America, also has strategic significance from the perspective of how such capabilities could be used by 

the Chinese state were the current friendly competition between the PRC and 

the United States to devolve into something more confrontational.

The purpose of this chapter is not to establish whether or not the activities by Chinese companies and the PRC government in telecommunications 

and space in Latin America are being conducted with nefarious intent, but rather, 

to detail their nature and scope, and to analyze what their strategic implications 

might be. This chapter thus implicitly argues that it is legitimate to analyze the 

strategic significance of Chinese telecommunications and space activities in Latin 

America based on how the Chinese commercial presence in those sectors could 

be used, without needing to establish that the PRC has explicitly developed plans 

to use them in this way. Indeed, in October 2012 the Permanent Select Com-
52 The Strategic Dimension of Chinese Engagement with Latin America

mittee on Intelligence of the US House of Representatives used this logic when 

it examined the US national security implications of the activities of the Chinese 

telecommunication firms Huawei and ZTE.1

Following in the spirit of the Committee, this chapter argues that particular attention should be given to the degree to which Chinese companies have 

come to occupy a major role in providing of telecommunications architectures 

across Latin America and are expanding their roles in building Latin America’s 

space architectures as well, particularly with the countries of ALBA, given the 

Committee’s conclusion that the PRC “has the means, opportunity, and motive 

to use telecommunications companies for malicious purposes.2 It concluded that 

“Huawei and ZTE cannot be trusted to be free of foreign state influence and thus 

pose a security threat to the United States and to our systems,” recommending 

that the Chinese companies be blocked from acquisitions, takeovers, and mergers in the United States, and that US government systems and contractors should 

exclude ZTE or Huawei equipment in their systems.3 Such declarations raise 

particular concern in a region where the same Huawei and ZTE are the producer 

of increasingly sophisticated cell phones, modems, and other telecommunications devices that contain or have access to a virtually limitless array of data, 

from the records of the physical movements of their users, to the data stored on 

or transmitted from their computers, whether personal, commercial, or governmental in character. Such words also merit closer consideration of a situation in 

which it is virtually impossible to find a government functionary, businessman, 

or ordinary person in the region whose most sensitive communications and information do not, at some point, pass through a Huawei or ZTE cell phone or 

data modem, over a Chinese built cell or fiber optic system, or get stored, at 

least temporarily, on a Lenovo computer.

Telecommunications

In its 2008 White Paper on Latin America, the Chinese government briefly mentioned communications systems as one example in which it sought to advance 

“practical cooperation” in building the region’s infrastructure.4 As with Chinese 

advances in other infrastructure segments such as work on roads and hydroelectric facilities, in the telecommunications arena, the Chinese government has 

kept its word. Today, Chinese firms are major players in virtually every major 

nation in Central and South America. The advance of Chinese telecom into Latin 

America has primarily been the story of two companies, Huawei and ZTE, and 

to a lesser extent, Shanghai Alcatel Bell. In each case, the expansion into Latin 

America represented part of the broader global expansion of these firms.

Huawei lists a corporate presence in 14 of the nations of Latin America, 

with a total of 10,000 employees5 in 19 regional offices, 3 software research 

and development centers and 3 training centers.6 Indeed, the firm even has a 
R. Evan Ellis 53

corporate presence in nations such as Paraguay with which the PRC does not 

have diplomatic relations.7 The degree to which Huawei has become a core part 

of the telecommunications infrastructure of the region is illustrated by its own 

corporate publicity, in which it notes that it is currently “a leader in market share 

across a range of different technologies and infrastructures in the region, including being the largest provider for IP DSLAM and Next Generation Network 

applications, and second in market share for optical networks, routers, and LAN 

switches for the entire region,” and that it is “embedded in leading-edge technology infrastructures across the region, including having built 3rd Generation 

UMTS infrastructures in Brazil, Mexico, Argentina, Colombia, Venezuela, Chile, 

Peru and Ecuador.” Going further, Huawei notes that it has provided technology 

solutions to almost all of the other major telecom players in the region, including America Movil, Telmex, Telfonica, Millicom, Nextel, TIM, Digicel, CANTV, 

and CNT.8 From the perspective of Huawei’s own leadership, Latin America is 

its fastest growing global market and its largest outside of Asia in terms of the 

number of persons employed. 9

Although ZTE does not make claims on its own website about its presence in Latin America in the manner that Huawei does, the firm lists 16 offices 

in the region, including ones in Panama, Paraguay, and Haiti, none of which have 

diplomatic relations with the PRC.

In general, the expansion of Chinese telecommunication firms in Latin 

America has been different from that of their Western counterparts. Huawei and 

ZTE have generally entered each new country-market in the region with a handful of senior executives operating out of small facilities with very low overhead, 

rather than beginning with an expensive, high-visibility initiative, as have some of 

their competitors. Indeed, in more than one country in the region, stories exist 

of Latin American government officials and telecommunication executives conducting high-level meetings with Huawei and ZTE executives in modest apartments being simultaneously used by the Chinese as their eating and sleeping 

spaces.

From such modest beginnings, the advance of Huawei and ZTE in each 

country has typically involved the winning of small infrastructure contracts enabling the expansion into new facilities, the importation of technical and managerial personnel from China, and the hiring of local workers as a larger presence 

is built in the country, both respect to the construction of networks and the sale 

of products such as cellphones, routers, modems, and other devices. 

The technical solution offered in Latin America has reportedly drawn 

heavily on the experience of the companies in China, where, like in Latin America, the telecommunications infrastructure was unreliable and the consumers had 

very little money for expensive products and contracts. Both Huawei and ZTE, 

for example, have been at the forefront of the market in offering extremely inex-
54 The Strategic Dimension of Chinese Engagement with Latin America

pensive cell-phones and “pay-as-you-go” plans tailored for lower-income persons 

who traditionally do not enter into service contracts.10

As they have expanded, however, a decisive factor in the ability of Huawei and ZTE to pursue opportunities at key moments within Latin America and 

elsewhere has been their ability to count on financing from Chinese banking 

partners.11

With respect to their patterns of expansion within the region, both 

Huawei and ZTE focused their efforts on larger countries and markets such as 

Mexico, Brazil, Argentina, and Chile, 12 but then also began to make important 

advances in the countries of ALBA where the favorable disposition of those governments toward the PRC expanded opportunities for commercial contracts 

with those states. Although Huawei and ZTE initially shied away from Central 

America and the Caribbean, where individual national markets were smaller 

and not all countries diplomatically recognized the PRC, by 2010, both Chinese 

companies had begun to make important advances there as well.

The expansion of both Huawei and ZTE in the region has included sales 

of retail products such as cell phones and data modems, as well as providing network services for the region’s governments and its major commercial telecommunication providers. By 2010, ZTE was selling telephones under the Movistar 

brand in Mexico, Colombia, Venezuela, Peru, Ecuador, Argentina, Uruguay, and 

Chile.13 In that year, the major Latin American telecommunications service provider Telefónica contracted with ZTE to introduce six ZTE cell phone models 

onto the market.

In addition to penetrating the cell phone market in general with lowcost devices, they have also made important advances by offering low-cost versions of more sophisticated “smart phones,” sold both under their own brand 

names and produced for cellphone service providers. In February 2011, for example, ZTE announced that it was launching a new high-end Android cell phone 

in the 12 Latin American markets where it has helped to build and operate a network for Movistar.14 From a strategic perspective, although there is no public evidence of wrongdoing by Huawei or ZTE, smartphones are potentially powerful 

tools if they were to be used nefariously by those with access to their hardware 

and internal software, due to the enormous amount of personal data that they 

poses on those who use them, including not only items such as financial records, 

email, and documents, but also a history of the location of the user, transmitted 

on a regular basis from a GPS device within the phone itself.15

The following sections examine key advances by Huawei, ZTE, and 

other Chinese telecommunications providers with respect to both hardware 

sales and infrastructure contracts in individual countries and sub-regions of Latin 

America.
R. Evan Ellis 55

Southern Cone

As noted previously, many of the early efforts of both Huawei and ZTE to penetrate Latin American and Caribbean telecommunications markets focused on the 

large middle-income markets of the southern Cone.

For more than a decade, Brazil has been a sub-regional center of gravity 

for both Huawei and ZTE. Huawei established its first Latin American office in 

the country in 1999, and as of early 2013, a research center16 and a series of facilities across the country.17 In May 2012, Huawei announced the establishment 

of a $61.5 million electronics production and distribution hub in the Brazilian 

city of Sorocaba, near the port of Santos, to employ 400 persons, the largest 

such facility that Huawei has in all of Latin America. Reportedly, the facility will 

complement the other 11 hubs that Huawei operates in the country to serve both 

Brazil and the markets of neighboring Latin American states.18 Brazil represented 

$2 billion in gross earnings for Huawei in 2012, approximately two-thirds of all 

of the company’s earnings in South America. 19

With respect to networks, Brazil has also been a focal point for Huawei’s deployment of 4G networks in the region—the leading edge telecommunications technology at the time that this work went to press. In February 2011, 

for example, Huawei was selected by NII holdings, the parent of Nextel in Latin America, to build the organization’s next generation networks in Brazil and 

Mexico.20 Separately, the new “technology center” established by Huawei in São 

Paolo state was seen as part of the firm’s deployment of 4G systems across Brazil 

and from Brazil, in neighboring countries.21

Like Huawei, ZTE also maintains a hub in Brazil, with announced plans 

to build a high tech industrial park with a research and development center, 

a $200 million production plant,22 and training and logistics facility in Hortolandia, São Paolo state.23 ZTE’s Hortolandia facility, built by renovating the 

Celestica electronics plant that had operated on the site until closing in 2009, 

also includes the final assembly of cell phones, allowing ZTE to realize significant tax breaks as a “local” producer, rather than importing its products into the 

country.24

Like Huawei, but on a smaller scale, ZTE has won various contracts to 

build infrastructure in the country, including an award announced in October 

2012 to construct a broadband network in conjunction with its Brazilian partner, 

TIM.25

The focus by Chinese telecommunications firms on the Brazilian market goes beyond Huawei and ZTE. In June 2012 China Communications Services, a subsidiary of China Telecom, announced intentions to establish a Latin 

American operation in São Paolo,26 building on a license granted by the Brazilian 

government to the parent company in September 2011 to operate in the country.27
56 The Strategic Dimension of Chinese Engagement with Latin America

Beyond Brazil, both Huawei and ZTE have also established a strong 

presence in the Argentine telecommunication market, including the same type 

of infrastructure contracts and product sales seen in Brazil, as well as the establishment of production facilities by each in Tierra del Fuego, in the southernmost 

part of the country, to achieve beneficial tax treatment as a “local” producer. Between Huawei and ZTE, total investment in these facilities in 2011 alone was reportedly $160 million.28 The Huawei facility was established in association with 

local partners New San and BGH, 29 while ZTE announced a facility there in July 

2011 with the same partner, BGH.30

With respect to networks, by the end of 2012, Chinese companies in 

Argentina appeared to be positioning themselves not only as major network provider for the major Latin American telecommunications firms, but potentially to 

leapfrog commercial providers to monopolize the deployment of 4G technology 

into the country. In October 2012, as part of a trip to Beijing, Argentine Minister 

of Planning and Public Investment Julio De Vido reportedly met with representatives of Datang Mobile Communication corporation, where they are believed 

to have discussed employing the Chinese firm to build the country’s entire new 

fourth generation (4G) cell phone network, rather than the Argentine government’s auctioning off the required communications bandwidth to commercial 

providers to build their own networks.31

In Chile the presence of Huawei and ZTE has been more modest than 

in Brazil and Argentina, yet still significant.32 Industry sources note that Huawei is involved as a partner or subcontractor with all of the major commercial 

operators in Chile, including Telefónica, Entel, and Claro, with a particularly 

important partnership with Nextel, building the 3G and other networks for the 

organization in the country, with a focus on rural areas previously lacking in 

coverage.33 In addition, during the June 2012 visit to Chile by Chinese primer 

Wen Jiabao, Huawei and ZTE signed various cooperation agreements,34 leading 

to an announcement in July 2012 that it was opening an “innovation center” in 

the University of Chile that would train ZTE engineers.35 In December 2012, 

the Chilean minister of Transportation and Telecommunications Pedro Pablo Errázuriz met with leaders from both ZTE and Huawei in China, seeking expanded 

investment by the Chinese companies in Chile, possibly to include their direct or 

indirect participation in the construction of new 4G networks in the country, to 

begin in 2013.36

As in other countries in the Southern Cone and elsewhere, Huawei 

and ZTE have also been major cell phone vendors in Chile. Huawei reportedly 

sold more than 150,000 cell phones there in 2011, 37 including low-cost smart 

phones, significantly expanding its market position.38

In Uruguay, although the national market for telecommunications is 

smaller than those of its southern cone neighbors, the center-left government 
R. Evan Ellis 57

of Jose Mujica has been receptive to leveraging the Chinese firms to expand and 

modernize the nation’s telecommunications architecture, including an accord 

signed by President Mujica during the visit to the country of Chinese Prime Minister Wen Jiabao, committing Uruguay to even greater cooperation with China 

in telecommunications.39 More concretely, in October 2012 the state telecommunications organization Antel announced that it was contracting with ZTE to 

install a new fiber optic network in the country, building on work that it had 

awarded to ZTE in 2011.40 During the trip to the southern cone by Chinese 

Prime Minister Wen Jiabao in June 2012, the government of Uruguay signed an 

agreement committing the country to even greater cooperation in the telecommunications sector.41

ALBA Regimes

Beyond the expanding base of contract work and product sales by Chinese telecommunications firms in the southern cone, many of their most significant advances have come in the countries of ALBA, aided by the positive disposition of 

those regimes toward working with the PRC, in combination with the availability of vehicles for financing projects for organizations tied to those governments 

through Chinese banks.

Projects by ALBA regimes with the Chinese span the same gamut of 

product sales and telecommunication services seen elsewhere, but often in partnership or under contract with the Chinese firm in representation of the Chinese 

state. The blurring of the boundary between commercial transactions and stateto-state relationships in such cases is particularly problematic, insofar as commercial entities representing a geopolitical rival to the United States (China) are 

entering often opaque contracts in a strategically important sector with countries in self-declared opposition to the United States, such as Venezuela. In such 

relationships, the question is not whether, but where concern should begin for 

the United States, along the spectrum of coproduction of telecommunications 

hardware with the Venezuelan state, exclusive contracts for telecommunications 

architectures, and (as seen in the next section) space-launch services, or component, service, and training contracts with ALBA militaries. Indeed, because 

the ALBA countries are unique in having contracted with the PRC to develop 

and launch national communications, data relay, and earth observation satellites, 

work by Chinese telecommunications firms gives the PRC a unique strategic position in having built, and having knowledge of, significant portions of the communications, data, and command and control architectures of those countries in 

the region most hostile to the United States.

Of all the ALBA regimes, the penetration by Chinese telecommunications firms is arguably most extensive in Venezuela. As of 2012, Huawei alone 

had more than 1,400 workers in Venezuela, of which 400 were Chinese.42 Since 
58 The Strategic Dimension of Chinese Engagement with Latin America

the nationalization of the national telecommunications firm CANTV in 2007, the 

government has let major contracts to Huawei for the extension of the national 

fiber optic network to remote rural areas of the country.43 Similarly, the Venezuelan government has contracted with ZTE to provide cable TV infrastructure 

for CANTV,44 as well as communication antennas and services to the national 

electric corporation.45 Both Huawei and ZTE have also reportedly worked with 

telecommunications provider Digicel in the preliminary stages of introducing 

4G networks into Venezuela.46

Huawei, for its part, has been contracted by the Venezuela government 

to provide various training and services, including work for the Venezuelan military organization DICOFAN, while ZTE was awarded contracts with the Venezuelan industry of mining and basic industries.47 In the latter case, the contracts 

included a system for real time monitoring of mining activity in the country, 

of great potential commercial and strategic value to China were ZTE ever to 

surreptitiously provide information obtained through its construction of the network to the Chinese government or Chinese companies interested in Venezuelan 

mining.48

With respect to commercial products, both Huawei and ZTE have sold 

their cell phones and other devices widely in Venezuela, and both have built manufacturing facilities there. 49 ZTE was the first to establish a cell phone factory in 

Venezuela, building its facility in Punto Fijo, in the Paraguaná Free Trade Zone. 

The first telephone produced by the plant, called the “Vergatario,” was showcased by former Venezuelan president Hugo Chávez in May 2009 during one 

of his frequent television appearances.50 Huawei’s Venezuelan plant, announced 

in May 2010,51 was built in Oronoquia, and became operational in December 

2012.52 Indeed, Huawei went even one step further, announcing in June 2012 

that it had chosen Caracas as the site for its first dedicated retail outlet outside of 

the PRC.53

In Bolivia, by contrast to Venezuela, the advance of Chinese telecommunications firms has proceeded more slowly, due in part to a lack of funding 

to develop the Bolivian telecommunications architecture in general. In recent 

years, however, both Huawei and ZTE have begun to make important advances 

there. In October 2009, 16 months after the nationalization of the telecommunications sector by the Bolivian government, the state organization running the 

sector, Entel, signed a $120 million contract with Huawei to implement the 

plan “Total Territorial Coverage” (TCT), with the object of providing service to 

1.5 million new users in 12,000 localities.54 The company was also, at the time, 

working on GSM and 3G networks in support of telecommunication provider 

Tigo, as well as performing other contracts for Entel and the private firm Viva.55

Despite initial successes in implementing TCT, including building transmission 

towers and providing services in Oruro,56 Huawei ran into difficulties in com-
R. Evan Ellis 59

pleting the contract, and in December 2010 the Bolivian government declared 

Huawei noncompliant and charged it a $8 million fine.57

The courtship of the Bolivian government by Chinese telecommunications firms was also visible in August 2011, when Bolivian president Evo Morales 

traveled to the PRC and included in his agenda separate meetings with executives from both Huawei and ZTE.58 Indeed, the following month, the Bolivian 

national telecommunications firm Entel awarded a major contract to Huawei to 

build infrastructure to expand cell phone coverage to rural areas.59

In Ecuador, the firm Huawei has dominated the market for public telecommunications contracts. From 2007 through 2011, according to a report by 

the Guayaquil newspaper El Comercio, Huawei won 61.4 percent of all contracts 

publicly awarded by the National Telecommunications Corporation of Ecuador 

(CNT), while ZTE won an additional 2.8 percent.60 Important specific victories include July 2011, when CNT awarded a contract for construction of a 

third-generation (3G) network to the firm Huawei, together with the firm 

Alcatel.61

The Ecuadoran case, however, also showed the competition that often 

exists between Huawei and ZTE in Latin American and other markets. When 

ZTE lost a competition for video, voice, and data services to Huawei in March 

2012 despite being the low-cost bidder, a series of public recriminations ensued, 

including a written protest to Ecuador’s president Rafael Correa, leading the 

Chinese embassy to intervene, directing the Chinese companies to refrain from 

such activities lest their actions cause “diplomatic problems.” 62

With respect to cellphones and other retail hardware, in 2010 ZTE 

introduced its product line into the country in conjunction with the telecommunications service provider Telefonica.63 In April of the same year, it initiated 

a project in the city of Chimbo to assemble low-cost cell phones for sale in the 

Ecuadoran market,64 in partnership with the Ecuadoran state.65

Finally, Chinese telecommunications companies have also made significant advances Nicaragua, even though its current regime does not diplomatically 

recognize the PRC. In January 2011, China’s Xinwei Telecom Enterprise group 

was licensed to operate cell phone and internet services in the country and has 

announced plans to invest $2 billion in the country from 2013 to 2016,66 including $700 million for infrastructure so that it could provide initial service, 

alongside competitors Claro, Telefonica, and Movistar.

Other Andean Countries

In the Andean countries not currently part of ALBA, Chinese telecommunications firms have also made rapid advances, although often with a less explicit role 

for the Latin American government.

In Colombia both ZTE and Huawei have an established presence across 
60 The Strategic Dimension of Chinese Engagement with Latin America

the country, performing government service contracts and selling cellphones 

and other products. In 2011, Huawei alone expanded its operations in Colombia by 50 percent, and by 2012 had a major role in the key telecommunication 

infrastructure activity in the country—the installation of a 4G “Long-Term Evolution” (LTE) network in the country.67 During the course of 2012 as well, both 

Huawei and ZTE expanded into major new facilities in the Colombian capital 

city of Bogotá. As of 2013, Huawei was the principal service provider for 3G networks in Colombia for the Tigo, as well as doing similar work for its competitor 

Movistar.68

In Peru, Huawei has been active builder of infrastructure for the major 

telecom service providers, including a key role in the construction of a wideband 

CDMA network by Nextel in 2011,69 as well as a major contract with Telefónica 

for the modernization of its fixed telephone system.70 ZTE has also made significant advances in the country, including the launch in 2011 of the country’s first 

4G broadband network, in conjunction with Chinese partner VelaTel (formerly 

ChinaTel).71 In July 2012, it was also announced that ZTE would be contributing 

key parts of the physical infrastructure for a new 2G/3G network to be built 

in the country by the Vietnamese national telecom provider Viettel, including 

building more than 2,000 base stations for the new network.72

As in Colombia, Huawei and ZTE have also made significant inroads 

in selling their cell phones in Peru; in February 2012, Huawei announced that it 

was considering the establishment of a cell phone manufacturing facility in the 

country.73

Caribbean Basin

The newest wave of significant advances by Chinese telecommunications companies in Latin America are occurring in the Caribbean basin. Prior to 2007, the 

sub-region was considered a relatively unprofitable market, with numerous individual countries, each with their own autonomous governments, many of which 

did not recognize the PRC diplomatically. Moreover, the region was dominated 

by a relatively well-established group of established telecommunications providers with strong relationships with local governments, making the prospect for 

penetration of the market by new entrants difficult.

In 2007, China’s absence from the Caribbean telecommunications sector began to change, with Huawei beginning to win a number of important contracts in Trinidad and Tobago,74 Jamaica, Aruba, the Cayman Islands, and Barbados.75 ZTE followed Huawei’s lead, developing a smaller, but important presence 

in Guyana, Guadeloupe,76 and Haiti,77 among others.

The expansion of the Chinese telecommunications presence in Cuba 

during this period had two important components. The first was the use of the 

Chinese to modernize the Cuban telecommunications infrastructure. By the end 
R. Evan Ellis 61

of 2009, for example, Huawei was working to build a broadband internet service 

in the country.78 The second piece was the use of Chinese firms to connect Cuba 

to the outside world through fellow ALBA partner nation Venezuela. The work, 

awarded to Shanghai Alcatel Bell, was completed in February 2011,79 with the 

1,000-mile cable extending from Camurey, in Venezuela to Siboney, Cuba. A 

secondary line also links Jamaica into the system.80 While the project in itself is 

modest, it has the effect of making Cuba, and to a lesser extent Jamaica, more 

dependent on the Chinese for international data connectivity.

One of the most significant Chinese telecommunication hubs in the 

Caribbean is arguably the Dominican Republic, where the firm Huawei has an 

80-person office, providing hardware and services to all of the major telecommunications providers: Telmex (operating in Dominica as Claro); the French 

national telecommunications provider Orange; Tricom; and the local wireless 

broadband provider Wind Telecom. The relationship with Tricom includes an 

important contract won in July 2012 to upgrade its national network to a 4G 

LTE system,81 part of Huawei’s strategic aim to deploy 4G LTE throughout the 

region.82

In addition to the Dominican Republic, Chinese telecommunication 

companies also have a growing presence in Trinidad and Tobago. Although the 

nation’s telecommunication provider TSTT had traditionally bought its equipment from the British company Nortel, in April 2012 Huawei won a $78 million 

contract to supply it components for the new mobile broadband network it was 

deploying.83 By November 2012, other telecom service providers such as British Telecom were also purchasing Huawei equipment to replace older components.84

As in other parts of the region, Huawei and ZTE are increasingly selling their cell phones and other telecommunications devices in the Caribbean 

through major telecommunications providers. In Jamaica in December 2012, 

for example, Huawei launched a new tablet through the telecommunications 

company Digicel.85

Finally, the advance of Huawei and ZTE in the Caribbean basin also 

includes the often overlooked nations of Suriname and Guyana. In Guyana, one 

of the first major advances for Chinese telecommunications providers came in 

December 2010, when the government awarded a $35 million contract to the 

Chinese firm Huawei to build a fiber optic cable connection from the capital 

Georgetown to the city of Latham on the border with Brazil, linking the Guyanese telecommunication infrastructure with that of Brazil.86 In addition, the contract also included construction of a 4G WiMax network providing high-speed 

wireless broadband coverage to the greater Georgetown area.87 By March 2012, 

the cable to Brazil was reportedly 85 percent complete, with follow-on plans to 

integrate the cable with infrastructure spanning the Guyanese coast from the Su-
62 The Strategic Dimension of Chinese Engagement with Latin America

rinamese border at Moleson Creek, Corentyne, Berbice, to the greater Georgetown area at Parika, East Bank Essequibo.88

In addition to these contracts, in April 2012 the Chinese telecommunications company Datang acquired a 20 percent interest in the national Guyanese 

telecommunications company, Guyana Telephone and Telegraph. 89 And the same 

month, a Chinese company was awarded a contract to build a new 4G LTE infrastructure, with the construction of a data center and transmission towers to 

provide upgraded internet to the previously mentioned coastal region.90

Central America

As in the Caribbean, Chinese companies had very little presence in the telecommunications market of Central America until very recently, arguably for many 

of the same reasons: the countries of the region were relatively small individual 

markets composed of countries that did not diplomatically recognize the PRC, 

and dominated by companies with strong particularistic relationships with the 

governments in place. Despite such difficulties, as in the Caribbean, both Huawei and ZTE appear to be advancing in Central America’s telecommunications 

markets.

In Costa Rica, the track record of Huawei in the nation since the country 

diplomatically recognized the PRC in 2007 has sparked controversy and criminal 

investigations. During 2007, the Costa Rican national telecommunications company ICE was exploring the upgrade of its wireless network to a 3G architecture 

from a legacy system composed of two incompatible systems, one built by Ericson, and the other built by Alcatel. According to telecommunications industry 

experts, Ericson had the inside track to build the new 3G network, but Huawei 

worked through the Chinese ambassador Wang Xiaoyuan, newly arrived following the country’s change in diplomatic recognition from Taiwan to the PRC, to 

convince the Costa Rican government to consider a bid by Huawei. Possibly 

sensing that Huawei now had the inside track, the other two major players in 

the market, Nokia and Erikson, refrained from responding when the bid was put 

out by ICE. In August 2008, Huawei submitted a proposal, as the sole bidder, 

at 159 percent of what ICE initially estimated the project should cost,91 and 

was eventually awarded the contract.92 In 2012, Huawei was subsequently found 

guilty and fined for having colluded with other telecom providers in the country, 

Nokia, Erikson, and Continex, so that they would refrain from bidding, enabling 

Huawei to secure a higher price to build the network.93

The penetration of Huawei in selling cell phones through different providers to the Costa Rican and other telecommunications markets was illustrated 

dramatically in February 2013 when the company accidentally shipped a case of 

1,000 phones purchased by the Costa Rican telecommunications agency ICE, 

bearing the logo of its competitor, Movistar.94
R. Evan Ellis 63

In Panama, although the country itself does not diplomatically recognize the PRC, Huawei maintains alliances with Cable & Wireless Panamá, 

Telefónica, Digicel, Claro Panamá, and Cable Onda to provide networks and 

consumer telecommunications products to the Panamanian market.95

In Honduras, also despite a lack of formal diplomatic relations, a group 

of Chinese investors reportedly entered in negotiations in 2010 for the acquisition of the state Honduran telecommunication firm Hondutel, although the 

deal has remained paralyzed due to issues including Chinese insistence that the 

Honduran state assume liabilities for Hondutel’s pension obligations.96

In Guatemala, ZTE is supporting Telefónica, which is operating in the 

country as Movistar, against Tigo, and Telmex, operating under the Claro brand.

Mexico

With respect to Mexico, both Huawei and ZTE have recognized the importance 

of the country as a market, and have set up significant telecommunications hubs 

there. Indeed, for Huawei, the country is currently the headquarters of the company’s Latin America operations.97 Huawei has had a presence in Mexico since 

2001, including a production facility in Guadalajara,98 and a center of operations 

in Mexico City,99 subsequently expanded in 2008 to include a new software research-and-development facility.100 The companies have also had important successes at the local level, including a contract by ZTE to provide wireless internet 

service for all of the capital, cemented following a trip to China by Mexico City’s 

mayor Marcelo Ebrard.101

As in other countries, Huawei has worked with the principal telecommunications companies in Mexico to build their networks. In February 2011, for 

example, Huawei was selected by Nextel to help the company build its new 3G 

Universal Mobile Telecommunications System (UMTS) network for all of Mexico (as well as for Brazil), putting Huawei at the heart of systems carrying the 

telecommunications traffic and data for one of the major networks for both of 

the largest and most sophisticated telecommunications markets in the region.102

It was also the technology provider behind a new offering by Mexico’s Salinas 

group, providing integrated television, telephone, and data service to Mexican 

homes.103

As in other parts of the region, industry sources note that Huawei has 

thoroughly penetrated the Mexican market, not only as a provider of network 

services, but also as a provider of fixed telephones, cell phones, data modems, 

and telecommunications software.104 As of late 2011, the firm reportedly had 

220 employees in Mexico, approximately 30 percent of whom were from the 

PRC.105
64 The Strategic Dimension of Chinese Engagement with Latin America

Space106

In addition to telecommunications, one sector in which China’s engagement 

with Latin America has had a particularly strategic character is space. In general, 

China–Latin America space cooperation is in its infancy, concentrated in Brazil 

and the countries of ALBA, but slowly expanding to encompass other states such 

as Argentina, Peru, and Mexico. China’s 2008 policy white paper on its relationship with Latin America and the Caribbean actually contains more detailed information on its military relationship with the region than space cooperation.107

As with Chinese advances in the Latin American telecommunications sector, the 

PRC’s growing engagement with Latin America in space and related technologies has potential strategic impacts, and thus is explored in greater detail in this 

section.

The Context of PRC Space Activities

China’s pursuit of space-related activities in Latin America is both driven and 

enabled by its own development of space as a strategically important sector. The 

PRC space program had its roots in the three-way competition with the United 

States and the Soviet Union during the Cold War, which highlighted the strategic 

value of rockets for penetrating enemy air defenses for rapid intercontinental 

delivery of nuclear arms. Since launching its first test payloads in 1964, China’s 

space program has performed over 100 orbital missions.

Today, concurrent with the economic and technology development of 

the PRC, the Chinese space program is pursuing a diverse array of objectives, 

from commercial satellite launches, to manned space flight (Project 921),108 to 

missions to the moon,109 Mars, and beyond. Current Chinese spending on space 

activities is estimated at $1.4–$2.2 billion per year, a level similar to that of 

France and Japan.110

China’s principal launch vehicle for its space flights has been the Long 

March family of rockets, with an impressive record for reliability, including more 

than 50 consecutive launches without a failure between 1996 and 2006.111 China 

relies on the Long March not only for its own space missions, but also for the 

launch services it offers to potential clients in Latin America and elsewhere.112

The PRC is moving away from a cold war posture not only in providing 

commercial launch services, but in its launch facilities. China’s three current space 

launch sites are closed bases in remote sites, as illustrated by Jiuquan, China’s primary launch site, located in the Gobi desert of Inner Mongolia. By contrast, the 

new Wenchang launch facility that China is developing on Hainan Island is much 

more accessible and much closer to the equator. The location will allow China to 

launch larger payloads with lower energy expenditure to equatorial orbit when the 

facility opens in 2014,113 thus making the facility competitive with existing equatorial sites such as Alcântara in Brazil and the Arianespace site in French New Guinea.
R. Evan Ellis 65

Since 2002, the PRC has launched 15 commercial satellites into orbit, 

including the Nigeria Communication Satellite Nigcomsat-1, the first Chinese 

communications satellite sold to a foreign country. Venesat-1, the satellite that 

China developed for Venezuela, was the first such satellite sold in Latin America.114 In building its presence in the commercial satellite market, China has competed on cost and the flexibility of its launch schedule. Indeed, the cost to the client for a commercial launch is as little as half that of its competitors. The PRC’s 

primary agent for foreign and commercial space activities is the China National 

Space Agency (CNSA), although the People’s Liberation Army (PLA) continues 

to play an important role in China’s space activities. In support of CNSA, space 

launches and related activities are executed by the state-owned enterprise China 

Aerospace and Technology Corporation, with a series of companies falling within 

this framework. One firm that is part of this business network is the Great Wall 

Industry Corporation (GWIC), the sole organization authorized by the Chinese 

government to provide satellite in-orbit delivery (IOD) services, commercial 

launch services and aerospace technology applications.115 Other firms include 

the China Academy of Space Technology (CAST) and China Academy of Launch 

Vehicle Technology (CALT), which regularly participate in China’s interactions 

with Latin American and other clients.

In building space relationships with countries in Latin America and 

elsewhere, China’s attempts to reach out have been limited by concerns over 

technology espionage and the quality of its space systems. The espionage issue, 

reflected in the 2008 conviction of Dongfan Chung in the U.S. for passing technical data to the Chinese while employed by Boeing, has been an impediment 

for governments and commercial companies to work closely with the Chinese 

on technologically advanced or sensitive space projects. A second challenge for 

the Chinese has been concern by clients regarding the reliability of the Chinese 

product, building on broader perceptions concerning the level of sophistication 

of Chinese space technology. This issue has been made worse with the failure of 

two of China's DFH-4-type communication satellites, including Nigcomsat-1, 

and indications of problems with Venesat-1,116 as well as non–mission critical 

equipment failures on CBERS satellites.

As China has developed its space capabilities it has also sought to expand its international cooperation efforts, including involvement in multilateral 

forums. By 2006 China had signed 16 international space cooperation agreements 

with 13 countries,117 which included their participation in the International Space 

Assembly and the establishment of the Asia-Pacific Space Cooperation Organization (APSCO) in 2005.118

The China–Latin America Space Relationship

PRC space cooperation in Latin America is oriented to support the broader Chi-
66 The Strategic Dimension of Chinese Engagement with Latin America

nese goal of developing this strategically important sector from an economic and 

technology perspective, as well as advancing its broader international political 

and strategic goals with respect to developing alliances and key influence relationships. Within this context, the pattern of China’s space cooperation with 

Latin America can be understood by dividing the region into four groups of 

countries: (1) those with limited space capabilities not actively pursuing space 

programs; (2) populist regimes purchasing Chinese satellite systems; (3) other 

countries developing limited space capabilities; and (4) Brazil as an emerging regional power with a multidimensional space program. The balance of this chapter analyzes China–Latin American space cooperation in terms of the distinct 

patterns of interaction seen in each of these four cases.

Countries Not Actively Pursuing Space Programs

Although many countries in Latin America can contract for space launch services, the majority (particularly in Central America and the Caribbean) do not 

have the economic size or level of technology and industrial diversification for 

which an integrated space program is a logical pursuit. Although many have highly educated personnel, university programs, and niche technology sectors that 

can contribute to regional programs, the PRC generally has not engaged with 

these countries on space issues to a significant degree.

Populist Regimes Purchasing Satellite Systems from the PRC

China’s most significant advances in space cooperation in Latin America in recent 

years have come with populist regimes politically disposed to do business with 

the PRC. 

The Venezuelan government of Hugo Chávez provided the PRC with its 

first opportunity to develop and launch a fully Chinese satellite in Latin America,119 signing a contract in 2005 to develop and launch a communication satellite 

for Venezuela, Venesat-1. As with China’s development of the Nigerian communication satellite Nigersat-1, Venesat-1 was developed by Great Wall Industries 

and launched from the PRC.120 For the PRC, the Venesat-1 project was an important commercial deal, apart from its strategic utility. Venezuela paid China 

$406 million,121 including $241 million for developing and launching the satellite, 122 financed by Chinese banks.

In addition, a primary control station to manage and communicate with 

the satellite was established within a military airbase in the remote plains of 

Guárico state, with a backup facility in the southeastern state of Bolivar. 123 The 

control stations will be administered by the Venezuelan Science and Technology 

Ministry, and the recently nationalized Venezuelan telecommunications company CANTV will administer use of the spectrum by the satellite.124 CANTV is 

already working closely with the Chinese firms Huawei and ZTE in other parts 
R. Evan Ellis 67

of the telecommunications sector, including expansion of the Venezuelan fiber 

optic backbone. 125

As part of the satellite package, 150 Venezuelan technicians were 

trained in the PRC to operate the satellite, and 30 Venezuelan students were 

given scholarships to do their doctoral dissertation in China on topics related 

to it. This training has provided the PRC with significant opportunities to build 

relationships with the new group of Venezuelan space leaders that the program 

had created.126

The satellite became operational on January 10, 2009,127 although 

some evidence suggests that, like the Nigersat-1 which ultimately failed, Venesat-1 initially was not operating properly.128 As part of the venture, the nation 

of Uruguay came to hold rights to 10 percent of the bandwidth of the satellite, 

because it owned the orbital slot into which Venesat-1 was placed. Nonetheless, 

seven months after the satellite became operational, Uruguay had not yet made 

use of any of that bandwidth.129

Following the success of Venesat-1, in September 2012 China launched 

a second satellite, the Venezuela Remote Sensing Satellite (VRSS-1), or “Miranda,”130 deepening the relationship and the presence of Chinese personnel in the 

country,as well as sending Venezuelan personnel to China for training. By October 18, 2012, the satellite had reached its designated orbit and had begun to send 

images back to earth, apparently functioning normally.131

Following the Venezuelan lead, as in its military relationship with China, in April 2010 the Bolivian government contracted with China for the development and launch of its own communications satellite, dubbed “Tupac Katari” 

after the Andean indigenous leader.132 The project required an investment of 

$300 million, of which $251 million was financed by China Development Bank 

through a loan with a 20-year repayment period.133 By December 2012, the satellite was reported to be 60 percent complete and moving into the assembly and 

testing phase with an anticipated launch date of December 20, 2013.134

As with the China-Venezuela satellite project, the Tupac Katari project 

with Bolivia involved the construction of two ground stations in Bolivia by the 

Chinese contractor, with one in Amachuma, near the Bolivian capital of La Paz, 

and a second control station in the Department of Santa Cruz, to the East, with 

Chinese technicians involved in the construction of the facilities and the training 

of Bolivians in its operation.135 The Chinese organization doing the work on the 

satellite itself, the China National Aero-Technology Import & Export Corporation (CATIC), reported in June 2012 that it had 10,000 engineers assigned to 

the project, although it did not indicate how many of these were, or would be, 

working in Bolivia.136

As part of the effort, in February 2010, Bolivia initiated a process to establish its own national space agency.137 As with the Venezuelan satellite projects, 
68 The Strategic Dimension of Chinese Engagement with Latin America

the Tupac Katari project also involved the sending of Bolivian personnel to the 

PRC for training. Reportedly, 1,733 persons applied for the training, of which 

64 were selected in October 2012 to be sent to the PRC.138

In 2012, even Nicaragua begun negotiations with the Chinese space 

launch organization Great Wall Industry Corporation for the development and 

launch of a communication satellite, referred to as “Nicasat-1” to be launched in 

2016 at an estimated total cost of $300 million.139 The Nicaraguan state telecommunications organization Telcor initially took the lead in presenting the project on the Nicaraguan side.140 As with similar projects in Venezuela and Bolivia, 

the project is anticipated to involve the training of Nicaraguan personnel in the 

PRC.141

In the cases of Venezuela, Bolivia, and Nicaragua the satellite projects 

were arguably important for the PRC, allowing its companies to prove the reliability not only of their launch services, but also their satellite technology. 

Through these projects they are gaining experience in doing business in the space 

sector of the region and positioning them to compete for the business of clients 

less ideologically disposed toward doing business with the PRC in the future, 

such as Chile, Argentina, and Mexico.

Beyond their contributions to the enhancement of the PRC space capability, China’s construction of ground control stations and the potential linkage to national telecommunication networks, also subject to significant contract 

work in each of the three cases, also gives the PRC unprecedented opportunities 

to understand the communication and space-technical architectures of each host 

country and to tap into them in the future, if necessary, to collect information 

or disrupt them. In the case of Venezuela, it is relevant that the Chinese telecommunication company Huawei plays an intimate role not only in the construction 

of the satellite command and control facility, but also in the construction of 

the Venezuelan fiber optic network.142 The previously mentioned infrastructure 

work of the Chinese company Huawei for the Bolivian state telecommunications 

firm Entel143 and the anticipated work of Xinwei in Nicaragua144 are of interest in 

this regard.

From a strategic perspective, the utility of projects such as those with 

Venezuela, Bolivia, and Nicaragua is also that they help major Chinese companies in their bid to become a commercially viable space launch and technology 

provider, in competition with established providers such as Ariane and Thales. 

Moreover, associated training of Latin American personnel in the PRC arguably 

provides China the opportunity to build relationships with, collect information 

from, and to some degree, to indoctrinate virtually the entire cadre of the recipient country’s military and civilian space-technical personnel.
R. Evan Ellis 69

Other Countries with Some Space Capabilities, Including 

Satellites

In addition to the Bolivarian socialist countries that have contracted with the 

Chinese to develop and launch satellites, six other nations in the region have 

space programs at some level: Argentina, Chile, Peru, Colombia, Mexico, and 

Brazil (which will be discussed in detail in the final part of this section). In each 

of these countries, the Chinese have sought to build a relationship in the space 

arena, including seeking to provide commercial launch services or technology 

collaboration, with mixed success.

In the case of Argentina, the first significant official cooperation with 

the PRC came in November 2004, during the visit of Hu Jintao and the signing of 

a framework agreement on “technology cooperation in the peaceful use of outer space.” The agreement included an expression of willingness by the Chinese 

government to provide Argentina commercial launch services, satellite components, and communication satellite platforms. Consistent with this accord, in 

May 2005 the Chinese government signed an agreement to provide technical 

support and equipment to the Argentine satellite manufacturer INVAP. At that 

time, INVAP was to support the Argentine national satellite company ARSAT in 

putting a new satellite into the 81-degree orbital position reserved for Argentina.145 In the end, however, Astrium and Thales Alenia Space, rather than China, 

were selected as the major equipment suppliers to INVAP. 146 Moreover, although 

the PRC was also interested in providing Argentina with launch services, ARSAT 

ended up contracting with the French firm Arianespace to launch the satellite in 

mid-2012 from the equatorial launch site in New Guinea.147

Beyond ARSAT, China and Argentina have also collaborated in the establishment of joint satellite tracking and control facilities in the south of Argentina, giving China access to coverage of the southern polar region that it lacks in 

the geographic position of its own country. The first significant manifestation of 

this collaboration was a 2005 agreement between China National Astronomical 

Observatories (NAO), China National Academy of Sciences (NAS), and the San 

Juan University in Argentina to construct a satellite laser ranging facility,148 subsequently completed February 22, 2006.149 Separately, in July 2010 a PRC delegation reportedly traveled to Neuquén, Mendoza, and Rio Negro, Argentina, to 

evaluate sites for the establishment of a new space antenna,150 and in July 2012 

the Argentine Space Agency CONAE and the Chinese satellite launch and control organization CLTC signed an agreement by which the satellite monitoring 

and control facility would be constructed in Patagonia.151

Beyond Argentina, delegations from the PRC have conducted exchanges with space-related bodies in Chile and Peru.152 In Chile, contacts led to the 

establishment, in February 2013, of a joint astronomy research center to support 
70 The Strategic Dimension of Chinese Engagement with Latin America

enhanced collaboration in space activities between China and Chile, as well as 

with other nations of Latin America.153 The PRC was also reportedly interested in participating in the development and launch of Chile’s first satellite, the 

Sistema Satelital de Observación de la Tierra (SSOT). In the end, however, the development work was done by the European firm EADS Astrium,154 and the launch 

contract was awarded to Arianespace.155

In Mexico none of the satellites developed and managed by the previously state-owned company SatMex have used China to develop or launch its 

satellites.156 Nor has there been significant open interaction between the Mexican government and the Chinese on space issues. Nonetheless, the 2010 establishment of a Mexican Space Agency157 has opened up an avenue for Mexico-China space collaboration in the future. In November 2012, for example, the 

Chinese Secretary General of the Asia-Pacific Space Cooperation Organization, 

Dr. Zhang Wei, visited the Mexican Space Agency and invited Mexico to join the 

Asia-Pacific Space Cooperation Organization (APSCO).158

In the case of Peru, although the nation does not have near-term plans 

for launching a satellite, the combination of its position as a Pacific-facing economy 

and its level of technological development in select space-related sectors led it to 

join APSCO when it was established.159 Peru has sent high-level dignitaries such 

as its foreign minister to visit APSCO, has participated in APSCO activities such 

as the space navigation course in Beijing, and is currently considering expansion 

of its participation.160 Nonetheless, APSCO is relatively new, and has not yet 

conducted a significant number of activities. For example, in September 2010 in 

Karachi, Pakistan, APSCO held only its second annual symposium.161 Moreover, 

in some ways, APSCO has not oriented itself well toward Latin America. The 

official opening of the APSCO headquarters in Beijing, for example, was held 

on Christmas Eve 2009, one of the holidays most reserved for family rather than 

business in Latin America.162 Although Brazil has also analyzed the possibility of 

joining APSCO,163 and despite the organization’s previously mentioned courtship 

of Mexico, to date Peru remains the only Latin American participant.

Brazil as an Emerging Regional Power with a Multidimensional 

Space Program

The most significant and multidimensional space cooperation between China 

and Latin America has been its relationship with Brazil. Contrasted with other 

Latin American countries, even before beginning to work with China in the late 

1980s, Brazil was actively working to develop space launch vehicles such as the 

VLS-1 as well as payloads such as its SCD-1 satellite.164

Brazil’s cooperation with China on space issues began in the late 1980s, 

driven in part by a desire to diversify away from reliance on the United States. 

At this time the new U.S.-led Missile Technology Control Regime (MCTR) was 
R. Evan Ellis 71

beginning to limit Brazil’s ability to obtain space-related materials and components. The regime’s limits came not only from the United States, but also from 

other countries participating.165 It was in this context that, in 1989, China entered a competition with the United States and France to launch a Brazilian communications satellite. China offered not only to launch the satellite on one of its 

Long March rockets, but also to transfer launcher technology that would benefit 

Brazil in the development of its own VLS-1 launch vehicle.166

The primary venue for China-Brazil space cooperation is the China-Brazil Earth Resources Satellite (CBERS) program, established in 1998. To 

date, a total of three satellites have been launched through the program from the 

Taiyuan Satellite Launch Center in Shanxi, China, in 1999, 2003, and 2007.167

A fourth launch was initially scheduled for December 2012, but postponed until May or June 2013 following technical problems on the Brazilian side.168 To 

date in the CBERS program, Brazil has assumed approximately 30 percent of 

the project cost, while China assumed the remaining 70 percent, including the 

construction of ground stations.169 The importance of the project in the broader 

Brazil-China relationship is evidenced by the fact that a key stop during President 

Hu’s visit to Brazil in November 2004 was to a CBERS project site at the National Institute for Space Research (INPE) in São Paulo.170

The China-Brazil space collaboration via the CBERS program has not 

been without its difficulties. The launch of the first joint satellite, originally 

scheduled for 1992, was delayed until 1998.171 Moreover, in August 2003, the 

first CBERS satellite experienced a malfunction, putting an end to all of its data 

transmissions, and in April 2005 one of two PRC-supplied imaging devices on 

the second CBERS satellite stopped working due to a power supply failure.172

Despite such problems, space collaboration with China has been positive for Brazil overall, and has continued under its own momentum, even while 

many of the initial reasons for cooperation have gone away.173 Upon assuming his 

post in March 2008, the new head of the Brazilian Space Agency stated that Brazil 

cherished its ties with China and would deepen its cooperation with China in the 

field of space technology.174

Potential Strategic Significance of PRC Telecom and Space 

Activities

In both telecommunications and space, the strategic significance of Chinese 

activities comes from three sources: (1) Chinese execution of the commercial 

projects described, in conjunction with local partners, supports technological 

advances by the Chinese in these sectors and maintains the corresponding technological base; (2) the act of physically constructing these assets creates opportunities for the Chinese to leverage them in the future for information and disruption activities; and (3) the Chinese personnel and operations on the ground 
72 The Strategic Dimension of Chinese Engagement with Latin America

in Latin America for the operation and maintenance of these assets could potentially be used against the United States or other actors in the event of a future 

conflict with the United States.

Both the United States and the PRC recognize the concept of “strategically important” sectors of the economy in which there is a national interest 

to sustain capability.175 While executing projects in Latin America in the telecom 

and space sector may not generate technological breakthroughs for the Chinese 

companies doing the work, it provides practical experience that leads to incremental advances in those technologies, including applying and adapting them 

in different contexts and working through associated problems. Similarly, while 

the Chinese companies may provide the core technologies, working with Latin 

American partners and clients provides new insights with respect to those technologies.

With respect to both telecommunications and space technology, PRC 

collaboration with Latin America and the experience that it gains as a builder of 

networks in the region, working with other major telecommunications companies as well as a satellite developer and provider launch services, will presumably 

make the PRC a more formidable actor with respect to military as well as civilian 

telecommunications and space architectures in the future.

There is nothing inherently wrong, of course, with the PRC making advances in telecommunications and space, and, indeed, the Chinese would argue 

that the United States has no right to attempt to “hold the Chinese back” in the 

development of important technologies such as telecommunications and space. 

It is simply a reality that must be acknowledged that the good that such advances generate for the Chinese people and economy also benefits PRC strategic 

military capabilities that the United States one day may have to face. Indeed, in 

its response to questions by the House Permanent Committee on Intelligence, 

the Chinese telecommunications firm Huawei acknowledged providing telecommunication products and services to the People’s Liberation Army, although 

accounting for only a small portion of the company’s total sales.176 The investigation cited, as further indication of such support, evidence from a former Huawei 

employee that the organization had provided technology and services to an elite 

PLA cyberwarfare unit.177

Beyond the contribution to Chinese military-technical capabilities in 

general, the construction and maintenance of space and telecommunications architectures and their associated components in Latin America creates opportunities for the Chinese to leverage these architectures for commercial and military 

intelligence collection, and potential disruption and denial in times of war. In 

its report on Chinese telecommunications firms, for example, the Intelligence 

Committee of the US House of Representatives argued that “to the extent these 

companies are influenced by the state, or provide Chinese intelligence services 
R. Evan Ellis 73

access to telecommunication networks, the opportunity exists for further economic and foreign espionage by a foreign nation-state already known to be a 

major perpetrator of cyber espionage. 178

In his testimony before the House, then–Deputy Assistant Secretary of 

Defense for the Western Hemisphere Rogelio Pardo-Maurer eloquently distinguished between the absence of a current threat versus the need to consider the 

implications of present commercial developments for the future, saying, “There 

is no evidence...that Chinese military activities in the Western Hemisphere, including arms sales, at this time pose a direct conventional threat to the United 

States or its friends and allies.” He then noted, “We need to be alert to rapidly 

advancing Chinese capabilities, particularly in fields of intelligence, communications and cyber warfare, and their possible application in the region,” and “we 

encourage other nations in the hemisphere to take a close look at how such activities could possibly be used against them or the United States.”179

Beginning with the populist governments that have contracted for satellite launch services, Chinese technicians, equipment, and training in the PRC 

are becoming part of the culture for a new generation of space personnel in these 

countries. This process is similar to the way that Soviet equipment, technology, 

and personnel shaped the experience of a generation of Cubans and Nicaraguans. 

It is likely that a positive Chinese performance in Venezuela and Bolivia will open 

up the Chilean, Argentine, and Mexican markets to Chinese launch services and 

satellites. Eventually, the Chinese could find business in the Peruvian and Colombian markets as well. Such ventures will reinforce the growing presence of PRC 

telecommunication companies Huawei and ZTE, making Chinese infrastructure, 

components, and the companies that administer them an ever greater part of the 

region’s telecommunications structures. For Latin American corporations and 

government entities, including the military, an ever-greater portion of data and 

message traffic will flow through, and depend on, Chinese-supplied infrastructure. Already the US sees a nontrivial portion of commercial and other message 

traffic flow through Latin American communication architecture.

US concerns over Chinese information warfare capabilities and cyber 

attacks against US government and industry targets are already well documented.180 For the Chinese, building telecommunications architectures gives the Chinese designers unique knowledge of the systems as well as of design capabilities 

in either the hardware or software that could be used to collect data traveling 

over those systems, introduce false information, or degrade or destroy them at 

the moment of the perpetrator’s choosing. The vulnerability created is far larger than is generally understood in an era in which everything from cables and 

switches to servers and routers to modems and the computers they connect to 

and the software that runs on each are, to some extent, made by Chinese companies. The risk applies not only to military and other government users, but to 
74 The Strategic Dimension of Chinese Engagement with Latin America

commercial and private ones as well. Similarly, with space assets such as Chinese-built satellites and ground stations and the Chinese-built telecommunications architectures they connect to, it is possible for such assets to be voluntarily 

put into the service of the Chinese state by the countries that own them, such 

as Venezuela, Bolivia, and Nicaragua, or to be used surreptitiously through the 

agency of the Chinese organizations that built them and who continue to provide 

personnel to operate and service them.

Moreover, although credible sources such as the US Congress have 

found evidence of questionable ties between Chinese telecommunications firms 

and the Chinese military and Communist Party, 181 the argument of whether Chinese companies such as Great Wall Industries, Huawei, ZTE, or Shanghai Alcatel 

Bell are agents of the Chinese state is, to a large degree, beside the point. Even 

were such companies purely commercial, they are subject to influence from the 

Chinese state, whether financially, administratively, or personally. As the report 

of the House Intelligence Committee on Chinese Telecommunications Firms 

pointed out, “Even if the company’s leadership refused such a request, Chinese 

intelligence services need only recruit working-level technicians or managers in 

these companies,” while under Chinese law, such companies would be obligated 

to cooperate with requests from the Chinese government to use their systems or 

access them for reasons of state security. 182 It is unrealistic to presume that such 

collaboration would not occur when the leadership of the companies involved 

have close ties to both the Chinese Communist Party and the People’s Liberation 

Army, including Huawei, whose founder Ren Zhengfei was an engineer within 

the People’s Liberation Army.183

Going beyond the Chinese-built equipment and architectures themselves, Chinese commercial facilities in the region, such as those of ZTE, Huawei, 

or Shanghai Alcatel Bell provide a cover for personnel and a base for resources 

in Latin America that could be used in time of conflict even if the products and 

architectures built by these Chinese commercial companies remained off-limits.

For many, such analysis may seem preposterous: a testament to those in 

the US predisposed to see the PRC as a threat and looking for reasons to block 

its peaceful rise. It is not. Rather, this chapter has sought to advance an open 

discussion of calculations that both the US and the PRC are surely making about 

each other, and should be acknowledged with openness and mutual respect.

Notes

1 See “Investigative Report on the US National Security Issues Posed by Chinese Telecommunications Companies Huawei and ZTE,” US House of Representatives, 112th 

Congress (October 8, 2012).

2 Ibid., 2.
R. Evan Ellis 75

3 Ibid., vi. 4 “Full text: China’s Policy Paper on Latin America and the Caribbean,” People’s Daily 

Online (November 6, 2008). 5 “Latinoamérica, uno de los mercados en mayor crecimiento para Huawei,” EFE (October 29, 2012).

6 Huawei, official website, accessed February 4, 2013. 7 Ibid. 8 Ibid. 9 “Latinoamérica, uno de los mercados en mayor crecimiento para Huawei,” EFE (October 29, 2012).

10 In Chile, for example, ZTE was among the first to offer such products to the market. 

“Telefónica confía en América Latina para implementar su sistema móvil de bajo costo,” 

El Mercurio (Santiago, Chile, October 8, 2012). 11 In Chile, for example, an initiative by the firm ZTE to introduce the new Wimax 

wireless infrastructure in the country was advertised as being backed by the financing of 

Chinese banks. See “Empresa china estudia apoyar el desarrollo de banda ancha WiMax 

en Chile,” El Mercurio (Santiago, Chile, March 13, 2009). 12 The projects are described in general terms, in the websites of both companies. 

See, for example, “Huawei America Latina,” http://www.huawei.com/es/catalog.

do?id=343. See also Jamie Hulse, “China’s Expansion into and US Withdrawal from Argentina’s Telecommunications and Space Industries and the Implications for US National 

Security” (Carlisle Barracks, PA: US Army War College Strategic Studies Institute, September 2007).

13 “Teléfono celular de marca blanca llegará a Ecuador,” El Universo (Guayaquil, Ecuador, February 17, 2010).

14 “Telefónica and ZTE to Strengthen Smartphone Offer in Latin America with Launch 

of Movistar Prime,” ZTE official website (February 17, 2011).

15 See, for example, David Kravets, “Appeals Court OKs Warrantless, Real-Time Mobile Phone Tracking,” Wired Magazine (August 2012). 16 “China’s Huawei invests US$300 million in research centre in Brazil,” MacauHub

(April 12, 2011).

17 “Huawei inaugura centro de distribución de US$61,5mn,” Business News Americas 

(May 31, 2012).

18 Ibid. 19 Ibid. 20 “NII Holdings has Selected Huawei as UMTS Supplier in Mexico and Brazil,” press 

release, Huawei official website, accessed February 5, 2013.

21 In discussing Huawei’s establishment of a technology center in São Paolo State, 

Brazilian Communications Minister Paulo Bernardo expressed his hope that the center 

would help Huawei to implement its new 4G network across the entire country, including providing new coverage to rural areas, then use its base in Brazil as a launching point 

for deploying its networks more broadly in the region. “Chinese Telecom Company Can 

Have Technology Center in Brazil,” Folha (July 11, 2010). 22 “Acuerdan instalación de parque industrial de tecnología china en Brasil,” Xinhua

(March 28, 2011).
76 The Strategic Dimension of Chinese Engagement with Latin America

23 Yun-Hee Kim, “ZTE to Invest in High-Tech Industrial Park in Brazil,” ZTE official 

website (April 13, 2011). See also “China invertirá en alta tecnología en Brasil,” La Nación

(Asuncion, Paraguay, July 5, 2011).

24 “ZTE Begins Brazil Expansion,” Business Monitor Online (August 15, 2011). 25 “ZTE Completes First Phase of Ultra Broadband Project for TIM Brazil,” ZTE official 

website (October 15, 2012).

26 “Chinese Telecom Firms to Expand in Latin America,” Xinhua (June 12, 2012). 27 “China Telecom Sets Up Unit in Brazil,” Global Telecom Business (June 14, 2012). 28 “Empresa china confirmó inversiones en Tierra del Fuego y tiene previsto fabricar 

500 mil celulares,” El Surenio (Tierra del Fuego, Argentina, July 9, 2011). 29 In the Project, TCL is operating in partnership with the local company Radio Victoria Fueguina. Orlando Andrada and Mariela Arias, “Al wok. China saltó al tercer puesto 

en la inversión extranjera en la Argentina,” La Nación (March 6, 2011). 30 Alejandro Alfie, “La china ZTE fabricará celulares para Movistar,” Clarin (Buenos Aires, Argentina, July 27, 2011). In addition, the Taiwanese company HTC, which specializes in smartphones, announced its establishment of a production facility in Tierra del 

Fuego in March 2012. “Llega otra marca china al Sur,” La Nación (Buenos Aires, Argentina, March 9, 2012).

31 Damián Kantor, “Cuáles son las rutas posibles para la telefonía móvil estatal,” Clarin

(Buenos Aires, Argentina, October 21, 2012). See also Jorge Oviedo, “Cuál es el límite 

de la aspiradora de dólares?” La Nación (Buenos Aires, Argentina, October 21, 2012). 32 Huawei reportedly registered $200 million in sales in Chile in 2010, less than a tenth 

of its activities in Brazil. “Tecnológica china Huawei proyecta alza de 50 percent de ventas 

en Chile,” El Mercurio (Santiago, Chile, June 13, 2011). 33 “Tecnológica china Huawei proyecta alza de 50 percent de ventas en Chile,” El Mercurio (Santiago, Chile, June 13, 2011). 34 “Chile y China empujan inversión y proponen duplicar comercio en visita de Wen” 

EFE (June 26, 2012). 35 “ZTE, Universidad de Chile to Open Innovation Center,” ZTE official website (July 

12, 2012).

36 “Chile busca aumentar inversión extranjera directa china en sector de telecomunicaciones,” Buisness News Americas (December 10, 2012). 37 “Tecnológica china Huawei proyecta alza de 50 percent de ventas en Chile,” El Mercurio (Santiago, Chile, June 13, 2011). 38 “Marca china Huawei lanza en Chile dos nuevos smartphones,” El Mercurio (Santiago, 

Chile, December 10, 2011).

39 “Premier Wen Vows to Further Ties with Uruguay,” China.org (June 23, 2012). 40 Industry analysts note that ZTE is a leader in implementing the technology involved, 

the next generation “Gigabit Passive Optical Network (GPON), and will have a major 

role in building and maintaining similar architectures not only in Uruguay, but potentially throughout the region. See “ANTEL Selects ZTE for Uruguay National GPON Project,” ZTE official website (October 10, 2012). See also “Antel selects ZTE for GPON 

Network,” Business News Americas (September 22, 2011). 41 “Premier Wen Vows to Further Ties with Uruguay,” China.org (June 23, 2012). 42 Mireya Tabuas and Maria Alesia Sosa, “No es un cuento chino,” El Naciónal (Caracas, 
R. Evan Ellis 77

Venezuela, April 15, 2012). 43 “Venezuela CANTV Selected Huawei Technologies to Upgrade Its Optical Fiber 

National Backbone Network,” Huawei official website (December 31, 2004). In addition, evidence suggests that Huawei has been contracted by the Venezuelan government 

to implement a command and control system for the Venezuelan defense organization 

DICOFAN. See for example, Monica Suinaga, Huawei design engineer, online resume. 

44 “ZTE proveerá televisión IP en Venezuela,” El Universal (Caracas, Venezuela. April 

26, 2009).

45 “Créditos pactados con China ascienden a $30 millardos,” El Universal (Caracas, Venezuela, November 25, 2011).

46 “El futuro de la telefonía,” El Universal (Caracas, Venezuela, July 10, 2012). 47 “Empresa china ZTE ayudará con automatización de Sidor y FMO,” Business News 

Americas (November 25, 2011). 48 “Venezuela implantará sistema chino de monitoreo en minas,” Xinhua (November 

24, 2011).

49 See, for example, Daniel Ricardo Hernandez, “Móvil bolivariano costar BsF 30,” El 

Universal (Caracas, Venezuela, March 5, 2009). 50 “Chávez celebra el lanzamiento del ‘Vergatario,’” El Universal (Caracas, Venezuela, 

May 10, 2009).

51 “Presidente anuncia operación de fábrica de celulares Orinoquia,” El Universal (Caracas, Venezuela, May 9, 2010).

52 “Gobierno destaca alta producción de celulares y computadoras,” El Universal (Caracas, Venezuela, December 19, 2012).

53 “Huawei inaugura su primera tienda comercial fuera de China,” Portafolio (Bogotá, 

Colombia, June 4, 2012).

54 “La empresa china Huawei se adjudicó proyecto TCT de Entel,” Jornada (October 

8, 2009). See also “ENTEL ejecutará proyecto Territorio con Cobertura Total en 2010,” 

Jornada, (December 5, 2009). 55 “La empresa china Huawei se adjudicó proyecto TCT de Entel,” Jornada (October 8, 

2009).

56 “Oruro es declarado ‘Territorio con cobertura total,’” Jornada (February 9, 2010). 57 “Multan con $US 8 millones a china Huawei por incumplir contrato,” Jornada (December 22, 2010).

58 “Evo Morales pide a los empresarios chinos mayor inversión en Bolivia,” EFE (August 

11, 2011).

59 “Bolivia y China firman 6 acuerdos de cooperación,” Los Tempos (Cochabamba, Bolivia, September 23, 2011).

60 Jeeyla Benitez, “Dos dragones chinos pelearon por jugosos contratos de la CNT,” El 

Comercio (Quito, Ecuador, January 16, 2012). 61 Ironically, Huawei’s closest competitor in the bid was ZTE. “Alcatel y Huawey logran 

adjudicación para instalar red 3G,” El Universo (Guayaquil, Ecuador, July 25, 2011). 62 Jeeyla Benitez, “Dos dragones chinos pelearon por jugosos contratos de la CNT,” El 

Comercio (Quito, Ecuador, January 16, 2012). 63 “Movistar traerá a Ecuador nuevos dispositivos móviles,” El Comercio (Quito, Ecuador, February 17, 2010).
78 The Strategic Dimension of Chinese Engagement with Latin America

64 “Desde Guayaquil se empezará a ensamblar celulares a fin de mes,” El Universo (Guayaquil, Ecuador, October 4, 2010).

65 “El Ecuador se dirige a fabricar celulares,” El Comercio (Quito, Ecuador, April 13, 

2010).

66 “China’s Xinwei to Launch Phone Service in Nicaragua,” Reuters (January 11, 2013). 67 “Huawei apuesta por 4G como su ‘negocio del año,’” La Republica (Bogotá, Colombia, 

March 8, 2013).

68 “Huawei apuesta por 4G como su ‘negocio del año,’” La Republica (Bogotá, Colombia, 

March 8, 2013).

69 “Nextel Perú Unveils World’s First W-CDMA Network with Push-to-Talk Services” 

(September 30, 2011).

70 This work reportedly included the installation of a new core network replacing Telefonica’s legacy switched system. See “ZTE IMS to Update Telefónica Group in Perú Fixed 

Network,” ZTE official website (April 23, 2012).

71 “Peru’s First 4G Wireless Network Set for Success,” Business Monitor Online (August 

3, 2011).

72 “ZTE se adjudica proyecto de red inalámbrica Naciónal 2G/3G con Viettel,” Business 

News Americas (July 11, 2012). 73 “Huawei analiza instalar una fábrica en Perú,” El Comercio (Lima, Peru, February 6, 

2012).

74 See, for example, “Huawei Deploys WiMAX Network in Trinidad and Tobago,” Caribbean Information Society Portal, accessed June 15, 2011. 75 “Huawei and Digicel Deliver Seamless 3G Network in the Caribbean,” Huawei press 

release (March 14, 2007).

76 “ZTE to Roll out 3G Networks in French Caribbean and Indian Ocean,” ZTE press 

release (February 24, 2009).

77 “Moving Towards 3G with ZTE’s All-IP CDMA2000,” ZTE press release, accessed 

June 15, 2011.

78 Adrian Hearn, “Cuba and China: Lessons and Opportunities for the United States,” 

Florida International University (June 2009).

79 “Cuba Gets Fiber-optic Cable Link to Venezuela,” Reuters (February 10, 2011). 80 “Cuba, Venezuela Link Via Undersea Cable,” The Right Perspective (January 23, 2011). 81 “Tricom implementará nueva red móvil 4g-LTE,” El Caribe (July 2, 2012). 82 Amilicar Nevar, “Empresa china tras mercados desde RD,” El Caribe (September 6, 

2012).

83 Mark Lyndersay, “TSTT Announces mobile Broadband Strategy,” Trinidad Guardian

(April 26, 2012).

84 Mark Lyndersay, “Bmobile Goes to Bat for 4G,” Trinidad Guardian (November 13, 

2012).

85 “Huawei Media Pad 7 Lite: The Next Big, Little Thing,” Jamaica Observer (Kingston, 

Jamaica, December 4, 2012).

86 “First Phase E-governance Initiative 85 Percent Complete,” Guyana Chronicle Online

(Georgetown, Guyana, March 6, 2012). According to one telecommunications industry 

expert interviewed off-the-record for this work, from Brazil another cable connects to a 

Huawei-built facility in Venezuela.
R. Evan Ellis 79

87 “ICT Would Lead the Way Forward for Guyana,” Guyana Chronicle (December 8, 

2010).

88 “First Phase E-governance Initiative 85 Percent Complete,” Guyana Chronicle Online

(Georgetown, Guyana, March 6, 2012).

89 “Gov’t Sells GT&T Shares to Chinese Company for US$30M,” Stabroek News (April 

6, 2012).

90 “GT&T Shares Buyer Linked to Chinese Military,” Kaieteur News Online (April 13, 

2012). See also “Guyana, China Sign Bilateral Cooperation Projects Deal,” Guyana Times 

International (January 3, 2013). 91 “Empresa china cobra 159 percent más por instalar red cellular,” Nación (San Jose, 

Costa Rica, August 5, 2008).

92 Cristian Leandro Córdoba, “Contraloría congela bienes de 12 altos funcionarios del 

ICE,” Prensa Libre (San Jose, Costa Rica, August 6, 2012). 93 Marco Antonio Gonzalez, “Multan Con $476 Mills. a Nokia, Ericsson y Huawei Por 

‘Manipulación’ al ICE,” Prensa Libre (San Jose, Costa Rica, July 11, 2012). 94 “Huawei se disculpa con ICE por confusión con logo de celulares,” Nación (San Jose, 

Costa Rica, February 8, 2013).

95 Mileika Lasso, “Huawei presenta gama ADSL y 3G,” La Estrella (Panama City, Panama, 

July 19, 2011).

96 “Preocupados trabajadores por posible privatización de Hondutel,” La Tribuna (Tegucigalpa, Honduras, October 23, 2010).

97 Huawei official website, accessed February 5, 2013. 98 Ulises Díaz, “Avanza Huawei en México,” Reforma (Mexico City. August 17, 2011). 99 Huawei reportedly invested $20 million to establish the center in 2006. See “China 

Huawei invierte 20 milliones de dólares en México,” Terra (November 14, 2006). 100 “Espera México recibir hasta 900 mdd de inversiones chinas,” El Sol del Bajío (Bajío, 

Mexico, July 11, 2008).

101 W. David Gardner, “China’s ZTE to Build Massive Wi-Fi Network For Mexico City,” 

Information Week (April 3, 2007). 102 “NII Holdings Has Selected Huawei as UMTS Supplier in Mexico and Brazil,” Huawei official website (February 15, 2011).

103 “Total Play descarta sinergias en servicios con Cablevisión,” El Universal (Mexico 

City, Mexico, June 1, 2011).

104 Ulises Díaz, “Avanza Huawei en México.” Reforma, Mexico City.,August 17, 2011. 105 Ibid. 106 This chapter is expanded and updated from the essay R. Evan Ellis, “New Frontiers? 

China-Latin America Space Cooperation,” Security and Defense Studies Review vol. 10, Center for Hemispheric Defense Studies (January-June 2010): 123–130.

107 The only reference to space is a portion of one sentence in the document: “The 

Chinese side will also strengthen cooperation with Latin America and the Caribbean in 

aeronautics and astronautics...and other areas of shared interest.” “Full text: China’s Policy Paper on Latin America and the Caribbean,” People’s Daily Online (November 6, 2008). 108 Peter Ritter, “The New Space Race: China vs. US,” Time (February 13, 2008). 109 In October 2007, China put an unmanned probe in orbit around the moon, and 

contemplates manned missions to the moon in the future. Jeffrey Logan, “China’s Space 
80 The Strategic Dimension of Chinese Engagement with Latin America

Program: Options for US-China Cooperation,” Congressional Research Service Document 

RS22777 (September 29, 2008).

110 Ibid. 111 In August 2009, a LongMarch 3A malfunctioned, placing the Indonesian satellite 

that it was carrying into a useless orbit. Peter B. de Selding, “Burn-through Blamed in 

China Long March Mishap,” SpaceNews (November 19, 2009). 112 Logan, “China’s Space Program,” op. cit. 113 Bruce Crumley, “China’s Takeoff in the Space Industry,” Time (March 12, 2009). 

See also C.P. Vick, “Hainan / Wenchang: The Fourth Launch Infrastructure for the Long 

March-2E, Long March- 3/3A/3B , and Long March-5 Launch Site Finally Identified,” 

Global Security (December 16, 2007). 114 Peter J. Brown, “Chávez Cherishes His Chinese-built Satellite,” Asia Times Online

(August 6, 2009).

115 Great Wall Industries official website, accessed June 29, 2010. 116 Brown, “Chávez Cherishes His Chinese-built Satellite,” Asia Times Online. 117 “China Signs 16 International Space Cooperation Agreements, Memorandums,” 

Space Daily (October 12, 2006). 118 According to Chinese sources, the PRC began actively participating in the International Space Assembly in 1993, and formed APSCO in 2005. Yang Minglie, “Chinese 

Role in the Regional Space Security Cooperation and APSCO,” presentation delivered in 

Tokyo, Japan (April 2007).

119 Although the Venezuela project was the first satellite that the PRC developed on its 

own for a Latin American country, China’s first official collaboration on such a project 

with a country of the region was the joint development of the first China-Brazil Earth 

Research Satellite (CBERS) with Brazil, beginning in 1988.

120 The satellite was launched into a 78-degree geosynchronous orbit. “Venezuela inicia operaciones del Satélite Simón Bolívar,” El Universal (Caracas, Venezuela, January 10, 

2009).

121 “Chávez celebra satélite para construir el socialismo,” El Mercurio (Santiago, Chile, 

October 30, 2008).

122 “Venezuela inicia operaciones del Satélite Simón Bolívar,” El Universal (Caracas, Venezuela, January 10, 2009). 123 James Suggett, “Venezuela to Launch its First Satellite from China in November,” 

Venezuelanaysis (August 18, 2008). 124 Ibid. 125 “Inside Telecom,” El Universal (Caracas, Venezuela, April 18, 2010). 126 James Suggett, “Venezuela to Launch Its First Satellite from China in November,” 

Venezuelanaysis (August 18, 2008). 127 “Venezuela inicia operaciones del Satélite Simón Bolívar,” El Universal (Caracas, Venezuela, January 10, 2009). 128 Reports in 2009, denied by the Venezuelan government, indicated that very little 

TV programming was actually being beamed down from Venesat-1, and internet traffic 

related to the satellite could not be found. Other complaints surfaced regarding the intermittent nature of the satellite signal, with one analyst declaring in July 2009 that “we 

now think the satellite is oscillating slowly on its axis.” Peter J. Brown, “Chávez Cherishes 
R. Evan Ellis 81

His Chinese-Built Satellite,” Asia Times Online (August 6, 2009). 129 Ibid. 130 “Autoridades confirman lanzamiento exitoso del Satélite Miranda,” El Universal (Caracas, Venezuela, September 29, 2012). See also “Venezuela prevé lanzar segundo satélite 

de fabricación china en octubre,” Universidad del Zulia (June 10, 2012). 131 “Primeras imágenes obtenidas por el satélite Miranda,” El Universal (Caracas, Venezuela, October 18, 2012).

132 “China, Bolivia Kick Off Communications Satellite Project [Xinhua],” Space News 

(August 12, 2011).

133 “Afirman que construcción de satélite tiene avance del 60 percent,” El Diario (La 

Paz, Bolivia, December 13, 2013).

134 Ibid. Reportedly three groups of Bolivians would be sent to China for different 

specialty courses, including satellite operation and satellite design. See also “Bolivian 

Satellite Operators to Be Trained in China,” Xinhua (July 24, 2012). 135 “ABE: Túpac Katari tiene un avance del 65 percent,” Los Tiempos (Cochabamba, Bolivia, December 12, 2012). See also “China to Train 64 Tupac Katari Satellite Operators,” 

Business News Americas (September 25, 2012). 136 “Afirman que más de 10 mil ingenieros y técnicos trabajan en construcción de 

satélite Túpac Katari,” Agencia Boliviana de Información (June 14, 2012). 137 “Bolivia: Space Agency to Be Established,” Defense Market Intelligence (February 

12, 2010).

138 “Presentan a bolivianos que se capacitarán en China para operar el satélite Tupac 

Katari,” El Diario (La Paz, Bolivia, October 10, 2012). 139 Danilo Valladares, “China llega a América Central con satélites y megaobras,” Euro 

Xpress (November 1, 2012). 140 “Nicaragua negocia la compra de un satélite,” El Nuevo Diario (September 4, 2012). 141 Ibid. 142 “Venezuela CANTV Selected Huawei Technologies to Upgrade Its Optical Fiber 

National Backbone Network,” Huawei official website (December 31, 2004).

143 “Bolivia y China firman 6 acuerdos de cooperación,” Los Tempos (Cochabamba, Bolivia, September 23, 2011).

144 In January 2013, China Xinwei announced plans to invest $2 billion in Nicaragua 

to build a telecommunications network. “China’s Xinwei to Launch Phone Service in 

Nicaragua,” Reuters (January 11, 2013). 145 Janie Hulse, “China’s Expansion into and U.S. Withdrawal from Argentina’s Telecommunications and Space Industries and the Implications for U.S. National Security” 

(Carlisle Barracks, PA, US Army War College Strategic Studies Institute, September 

2007).

146 “Arianespace Lands Arsat-1 Launch Contract,” SpaceNews (June 28, 2010). 147 Ibid. 148 “China Argentina Cooperate on Astronomical Research,” People’s Daily Online (Beijing, China, September 9, 2005).

149 T. Wang, F. Qu, Y. Han, W. Liu, E.L. Actis, and R. Podesta, “New SLR Station Running in San Juan of Argentina,” NASA official website, accessed July 30, 2010.

150 “China Eyes Argentina for Space Antenna,” Space Daily (June 9, 2010).
82 The Strategic Dimension of Chinese Engagement with Latin America

151 “China construirá una antena de investigaciones espaciales en Argentina,” Actualidad

(July 26, 2012).

152 Yang Minglie, “Chinese Role in the Regional Space Segurity Cooperation and APSCO,” presentation delivered in Tokyo, Japan (April 2007).

153 “Astronomy Research Center Launched by China, Chile,” Xinhua (February 1, 

2013).

154 “Astrium Presents the Completed SSOT Satellite to the Chilean Government,” 

EADS Astrium official website (February 9, 2010).

155 “Arianespace to Launch SSOT Observation Satellite for Chile,” SpaceNews (December 21, 2008).

156 Indeed, the development contract for the current satellite being contracted by the 

company, SatMex-8, was recently awarded to the US-based firm Loral. Peter B. de Selding, “Satmex Orders Satellite from Space Systems/Loral,” SpaceNews (May 10, 2010). 157 Juan Arvizu and Horacio Jimenez, “Crean diputados agencia especial Mexicana,” El 

Universal (Mexico City, April 20, 2010). 158 Visita del Secretario General de la APSCO a la AEM,” Mexican Space Agency official 

website (December 10, 2012).

159 “China Signs 16 International Space Cooperation Agreements, Memorandums,” 

Space Daily (October 12, 2006). 160 An official APSCO summary of the March 26, 2010, meeting between the Secretary 

General of APSCO and the Foreign Minister of Perú, for example, reported that “Both 

sides agreed to continue their discussion on the commitment and more active participation of Perú in APSCO.” “Secretary-General of APSCO meets Foreign Minister of Perú,” 

APSCO official website (March 30, 2010). See also “Experts Meet in Beijing for APSCO 

Projects,” APSCO official website (March 29, 2010).

161 APSCO official website, accessed June 29, 2010. 162 “Opening Ceremony of the Headquarters of APSCO,” APSCO official website (December 24, 2009).

163 On March 17, 2010, a high-level Brazilian delegation headed by the president of 

INPE visited APSCO Headquarter and discussed with APSCO secretary general and officials about the possibility of Brazil attaining associate membership. “Brazil Explores 

Possible Membership in APSCO,” APSCO official website (March 23, 2010).

164 Brazil’s space program has been in existence since 1961, with its current coordinating institution, the National Institute for Space Research (INPE), in existence since 

1990. In cooperation with the Brazilian Space Agency (AEB), INPE both develops satellites and indigenous launch vehicles. Luis Bitencourt, “Developing Countries and Missile 

Proliferation: The Cases of Argentina, Brazil and India,” Ph.D. dissertation (Washington, 

DC: Catholic University of America, 2001).

165 Ibid. 166 Ibid., 148. 167 “Satellites: CBERS-1, 2 and 2B | CBERS-3 and 4,” China-Brazil Earth Resources 

Satellite (CBERS) official website, accessed July 2, 2010.

168 “Launch of Chinese-Brazilian Satellite Delayed until May/June 2013,” Macau Hub

(January 21, 2013).

169 Fabíola de Olivera, O Brasil Chega Ao Espaço: SCD-1 satélite de coleta de dados (São José 
R. Evan Ellis 83

dos Campos, São Paolo, Brasil: Instituto Naciónal de Pequisas Espaciais, 1996): 81. 170 “Hu Jintao Visits the China-Brazil Aeronautics and Space Cooperation Project in 

Sao Paulo,” Ministry of Foreign Affairs of the People’s Republic of China official website 

(November 15, 2004).

171 Fabíola de Olivera, O Brasil Chega Ao Espaço: SCD-1 satélite de coleta de dados (São José 

dos Campos, São Paolo, Brasil: Instituto Naciónal de Pequisas Espaciais, 1996).

172 Gyanesh Chander, “An Overview of the CBERS-2 Satellite and Comparison of the CBERS-2 

CCD Data with the L5 TM data,” US Geological Survey, Presentation (March 16, 2006).

173 Ironically, China and Brazil both ultimately joined the Missile Technology Control 

Regime. Bitencourt, “Developing Countries and Missile Proliferation," 1,491.

174 “Brazil to Deepen Space Cooperation With China,” Space Daily (March 27, 2008). 175 The very title of the principal economic blueprint of the PRC for managing nearterm economic development, for which the 12th and most recent iteration was released 

in May 2012, is the “Five-Year Plan on National Emerging Industries of Strategic Importance.” See Yao Lu, “China Releases 12th Five-Year Plan for National Strategic Emerging 

Industries,” China Briefing (July 25, 2012). 176 The products acknowledged by Huawei included teleconferencing services and various voice-over internet (VoIP) products. See “Investigative Report on the US National 

Security Issues Posed by Chinese Telecommunications Companies Huawei and ZTE,” US 

House of Representatives, 112th Congress (October 8, 2012): 34.

177 The committee ultimately concluded that the evidence that it examined would not 

allow it to rule out that Huawei was conducting research and development and other 

forms of support to the Chinese military. See “Investigative Report on the US National 

Security Issues Posed by Chinese Telecommunications Companies Huawei and ZTE,” US 

House of Representatives, 112th Congress (October 8, 2012): 34. 178 “Investigative Report on the US National Security Issues Posed by Chinese Telecommunications Companies Huawei and ZTE,” US House of Representatives, 112th Congress 

(October 8, 2012): iv.

179 House International Relations Committee, Subcommittee on the Western Hemisphere, Hearing on “China’s Influence in the Western Hemisphere,” Serial. No. 109-63 

(April 6, 2005).

180 See “Investigative Report on the US National Security Issues Posed by Chinese 

Telecommunications Companies Huawei and ZTE,” US House of Representatives, 112th

Congress (October 8, 2012): 34.

181 The investigation cited questions about the activities of former Huawei board members with PLA ties, as well as the acknowledgement of the existence of a Communist 

Party committee within the organization. See “Investigative Report on the US National 

Security Issues Posed by Chinese Telecommunications Companies Huawei and ZTE,” US 

House of Representatives, 112th Congress (October 8, 2012): 20–22. 182 See “Investigative Report on the US National Security Issues Posed by Chinese Telecommunications Companies Huawei and ZTE,” US House of Representatives, 112th Congress (October 8, 2012): 3.

183 “La empresa china Huawei lanzó el smartphone más fino del mundo,” Clarin (Buenos 

Aires, January 10, 2013).

85

Chapter 5

The PRC–Latin America Military 

Relationship1

Introduction

One of the most common statements made in discussions of Chinese engagement with Latin America is that such ties are primarily “commercial” in nature. 

While true, the focus on the commercial dimension of the relationship conceals 

the fact that over the past several years the People’s Republic of China (PRC) 

has also expanded its military ties with Latin America in several important ways, 

consistent with its own public declarations of intention. In November 2008, for 

example, the PRC issued its first official policy paper on Latin America in which 

it announced that it sought to enhance “mutual visits by defense and military officials of the two sides as well as personnel exchanges,” and to deepen “professional 

exchanges in military training, personnel training and peacekeeping.”2

China’s military engagement with Latin America in recent years has 

both expanded and deepened in a quite public manner. High-level trips by Latin 

American defense and security personnel to the PRC and visits by their Chinese counterparts have become commonplace. The volume and sophistication 

of Chinese arms sold to the region has increased. Officer exchange programs, 

institutional visits, and other lower-level ties have also expanded. Chinese military personnel have begun participating in operations in the region in modest, 

yet symbolically important ways.

Since the awarding of port concessions in Panama to the Hong-Kongbased firm Hutchison Whampoa in 1997, Chinese military engagement with 

Latin America has been one of the most broadly discussed, but misunderstood 

dimensions of PRC activities in the region.3 The PRC’s military initiatives with 

Latin America are arguably not the largest or most strategically significant part 

of its rapidly expanding interactions with the region. Nor do they visibly threaten the United States or undermine pro-Western regimes in the same fashion 

as Soviet military engagement with Latin America during the Cold War. It is, 

however, significant, growing, and continues to be a key to the evaluation by US 

decision makers whether the Chinese presence in Latin America constitutes a 

strategic threat to the interests of the United States.

The purpose of this chapter is to analyze PRC defense and security ties 

in Latin America. It is divided into three sections: (1) objectives of PRC defense and 
86 The Strategic Dimension of Chinese Engagement with Latin America

security engagement with Latin America, (2) manifestations of that engagement, and 

(3) strategic implications.

Objectives of PRC Defense and Security Engagement with 

Latin America

Given the predominantly commercial nature of Chinese interactions with Latin 

America, it is important to begin the analysis of PRC military activities in the region with a discussion of Chinese motivations for engagement with Latin America in general, and how military ties and transactions simultaneously support and 

put at risk those goals.

While the PRC has publicly professed its interest in expanding military 

linkages with Latin America, it has given very little explanation of its reasons for 

doing so, or how its military activities fit into its broader engagement with the 

region. This does not imply that such motivations are inherently nefarious—only 

that they must be examined, based on the available evidence as well as current 

and historic patterns of Chinese decision making.

In the spirit of classical Chinese thinkers such as Sun Tzu, PRC military initiatives in Latin America should be understood as subordinate to, and in 

support of, long-term PRC national objectives in the region. In general, these 

objectives involve promoting and protecting China’s reemergence as a major 

global actor.

The imperatives and risks involved are a product of the export-led 

growth strategy that the PRC has pursued and refined since 1978. Specifically, it 

has leveraged the opportunities presented by global information and trade flow, 

and its initial comparative advantage in inexpensive, abundant labor to serve as 

a global manufacturing hub. In doing so, it has attracted and used foreign investment in a deliberate fashion to build its physical and technological infrastructure 

and diversify its economic base, moving progressively into ever higher-value 

added economic activities.4 

China’s pursuit of this strategy and its place in the global economy have 

created a number of imperatives: (1) securing access to reliable sources of primary products in support of manufacturing activities and capital formation, (2) 

ensuring the ability to feed the Chinese population as it both urbanizes and consumes more protein, (3) establishing and protecting markets for Chinese goods 

as its producers continue to expand production and move up the value-added 

chain, (4) securing access to technology and global information flows, (5) maintaining a presence in institutions key to China’s global economic transactions, 

and (6) avoiding the consolidation of an international coalition opposing the 

“rise” of the PRC.

Chinese military engagement with Latin America supports each of 

these imperatives, albeit often in indirect ways. President Hu Jintao addressed 
R. Evan Ellis 87

the role of the Chinese military in support of national development objectives in 

his call for the PLA to carry out its “new mission in the new century.”5 Similarly, 

China’s 2006 National Defense White Paper refers to the role of the PLA in 

“fostering a security environment conducive to China’s peaceful development.”6

Similar language is contained in the November 2007 constitution of the Chinese 

Communist Party and the 2008 National Defense White Paper.7 Chinese authors 

have written about the new “interest frontier” of the PRC, suggesting that the 

PLA has an obligation not only to defend Chinese interests within the physical 

territory of the PRC, but to protect those interests that are found outside it as 

well.8

Because US political leaders generally view military activities in a manner very distinct from trade and investment, Chinese leaders have incentives to 

be very cautious in their military engagement in order to avoid undermining 

important national strategic goals in Latin America. As a result, the imperatives 

for the PRC of military engagement in Latin America contrast sharply with conventional wisdom regarding the use of the military instrument.

These imperatives may be inferred to be as follows: 

1. building goodwill, understanding, and political leverage;

2. creating the tools to protect PRC interests in-country;

3. selling Chinese products and moving up the value added chain;

4. positioning the PRC strategically in the region; and

5. reassuring the US and the West.

Building Goodwill, Understanding, and Political Leverage

For the PRC, military engagement is one tool, among many, for building political good-will and leverage in a country in order to make it more likely that the 

regime will not oppose the entry of Chinese products or act against its investments. Military activities are useful in this context because the armed forces 

remain an important political actor in most Latin American countries, although 

thinking of the military as a political instrument is also consistent with both Chinese communist and pre-communist philosophy. 

Knowing and being on good terms with the military leadership of a 

Latin American country helps the Chinese to understand the overall political 

dynamic of that country, anticipate actions that could be taken against PRC 

commercial interests, influence the political leadership through military friends 

where necessary, and anticipate or avoid actions that could be taken by the armed 

forces in the political arena that could impact Chinese interests. 

Within the larger framework of military engagement, people-oriented 

activities such as leadership visits, training, and exchange programs are particularly useful because they allow the PRC to confer personal benefits and establish 

relationships with current and future defense leaders, while avoiding the type of 
88 The Strategic Dimension of Chinese Engagement with Latin America

symbolism that bases or military end item sales generate for Western analysts.

Creating the Tools to Protect Chinese Interests In-country

As Chinese companies and businessmen expand their physical presence in Latin 

America, they will experience a corresponding increase in the security challenges to people and operations that have confronted the companies of other 

countries operating in the region, including kidnapping, extortion, and violence 

associated with strikes, political protest, and terrorism. Chinese petroleum and 

mining firms operating in remote areas are particularly vulnerable, as seen by 

the violence against Andes Petroleum and Petroriental in the north of Ecuador 

in 20069 and 2007.10 Problems may also be expected with the transportation of 

goods over newly opened highways and rail routes over the Andes and through 

the Amazon jungle, such as the northern and southern “bi-oceanic corridors” 

crossing Peru, the “interoceanic corridor” from the north of Chile through Bolivia and Brazil, and the future Manta-Manaus corridor.11 Cultural differences between the Chinese and local populations are also likely to contribute to tensions 

and increase the possibilities for violence, as seen in the 2007 truckers strike 

against Chinese shopkeepers in Buenos Aires,12 or the November 2004 violence 

against Chinese communities in Maracay and Valencia, Venezuela.13

In the near term, PRC companies will have to rely upon Latin American 

police and armed forces, as well as private security and the payment of protection money, in order to avoid harm to Chinese personnel and operations. As the 

value of Chinese investments in the region and the resource flows from it grow, 

the PRC will have an increasing incentive to improve the functionality of these 

security forces, and to ensure that the protection of Chinese personnel and operations receives priority. Similarly, it will have incentives to become involved in 

issues of port and airport security in the region, as well as high-value geography 

that impacts the movement of goods, such as the Panama Canal, as well as highway, rail, and alternative canal routes crossing the continent.14

Indeed, the PRC has already demonstrated a willingness to use its military to protect its commercial interests in Africa, citing threats to these interests 

as justification for deploying naval forces to conduct anti-piracy operations in the 

Gulf of Aden in December 2008.15 There is also already an ongoing debate within the PRC regarding the best ways to protect Chinese commercial operations, 

including discussions by retiring PLA military officers to form private security 

companies to support commercial ventures abroad.16

Selling Chinese Products and Moving Up the Value-Added 

Chain

Although Chinese military exports are relatively small by comparison to other 

goods, they contribute to PRC national development in multiple ways. As with 
R. Evan Ellis 89

other commercial products, military products generate export revenues for Chinese companies such as the Northern Industries Company (NORINCO) defense 

conglomerate, and sustain employment. Sales of nonlethal military goods such as 

clothing and personal equipment in Latin America by Chinese companies, for example, are an often overlooked but not trivial. Such sales also sustain the health 

of the PRC defense industrial base and help it advance its technical capabilities 

in support of national defense goals. This is particularly the case with respect to 

high-end goods such as radars, aircraft, armored vehicles, and other sophisticated military end items, or “dual-use” commercial goods, where sales in Latin 

America help China to test, prove, and refine its capabilities under field conditions in strategically important sectors.

Positioning the PRC Strategically in the Region

Chinese military thinkers, as do others around the world, recognize the implications of the emergence of the PRC as a principal global actor, including the need 

to prepare for large-scale hostilities to protect these global interests. Although 

the PLA is very careful to cast its military preparations as “defensive” in nature, 

debates within the PLA over the need to develop a “deterrent force” and references to an “active defense”17 implicitly acknowledge that Chinese thinkers have 

contemplated the necessity of carrying a future conflict to the adversary. Similarly, although the PRC currently lacks the capability to project significant military 

capability beyond Asia, the pursuit of “defense in depth” by the PLA Navy suggests an acknowledgment of conducting the battle as far away from its shores as 

capabilities will allow, while references in the 2008 defense White Paper to close 

coordination between military struggle and political, economic, and diplomatic 

endeavors18 suggest a global approach to thinking about warfare.

Nothing in the public discourse of the Chinese leadership, policy papers, or debates suggests that Latin America is considered in the short term as 

a base for military operations. Nonetheless, in the long term, when the PRC is 

both economically and militarily more powerful than it is today, the ability to deter a strategic adversary such as the United States through holding it at risk in its 

own theater and disrupt its ability to project power at home before those forces 

can reach the PRC is consistent with the aforementioned concepts, including a 

holistic, asymmetric approach toward warfare.19

Within such a manner of thinking, China’s military ties in Latin America afford 

geographically specific benefits, such as collecting intelligence on the operation 

of US forces, creating diversionary crises, closing down strategic chokepoints 

such as the Panama Canal, or conducting disruption operations in close proximity to the United States.
90 The Strategic Dimension of Chinese Engagement with Latin America

Reassuring the United States

As noted previously, the PRC’s pursuit of military objectives in the region is 

subordinate to its broader national objectives. Where the two conflict, the exact 

balance will reflect the perceptions of the Chinese leadership, national self-confidence, and their propensity for risk taking, which continues to evolve with 

each successive generation of Chinese leadership. Direct forms of security assistance, for example, may support the objective of protecting Chinese companies 

and resource flows, yet undermine the more important strategic objective of 

preserving access by the PRC to Western technology and markets. At the very 

least, China has strong incentives to portray all military interactions with Latin 

American states in a way that does not appear to threaten the United States, so as 

to minimize the risk of damage to its broader objectives. In many cases, this not 

only will impact how China represents its activities, but how it structures them. 

Gifts of military medical capabilities or logistics gear, for example, may be preferable to selling or donating more lethal end items because the former generates 

similar institutional goodwill and contacts, while appearing less threatening.

In general, as this section has suggested, the course taken by Chinese 

military engagement with Latin America in the medium or long term is likely 

to differ significantly from that witnessed with respect to Soviet military activities in the region during the Cold War. In general, the PRC is more likely to 

refrain from overtly provocative activities, such as the establishment of bases 

with a significant Chinese presence, overt military assistance to groups trying to 

overthrow a regime, unilateral military intervention in the region in a contested 

leadership situation, or participation in anti-US military alliances.

Manifestations of Chinese Military Engagement with Latin 

America

Chinese military engagement with the region may be understood in terms of five 

interrelated types of activities: (1) meetings between senior military officials, (2) 

lower-level military-to-military interactions, (3) military sales, and (4) Chinese 

physical presence within Latin America with military-strategic implications.

Meetings between Senior Military Officials

Based on official visits documented in the press, the number of visits by senior 

Chinese defense officials to Latin America and visits by their counterparts to 

China have increased over the past several years. The press accounts of the agendas of these visits suggest that the purpose is often to establish or strengthen 

relationships, including not only exchanging views on security matters, but also 

discussing or finalizing agreements for arms purchases, military exchanges, or 

other contacts and transactions.

Contacts between senior Chinese and Latin American defense leaders 
R. Evan Ellis 91

have expanded over the past decade. They are somewhat more concentrated in 

the nations of ALBA, but include interactions between Chinese officials and their 

counterparts in all parts of Latin America and the Caribbean. Such contacts 

encompass both trips by Latin American senior defense officials to China and 

trips by Chinese officials to Latin America, as well as interactions in multilateral 

forums. 

Recent interactions of note include, but are not limited to the following:

• In August 2010, Bolivian minister of Defense Ruben Saavedra traveled to 

the PRC to meet with his counterpart, then–Chinese Minister of Defense 

Cao Gangchuan.20

• In September, Cuban General Leopoldo Cintra Frias traveled to Beijing to 

meet with Minister Cao and other senior PRC defense leaders.21

• Later the same month, Chief of the PLA General Staff Chen Bingde traveled 

to Lima, Peru, for a visit that included a joint military-humanitarian exercise 

between Chinese and Peruvian armed forces and the donation of a mobile 

field hospital to the Peruvian Army.22

• Also in September, the new Chinese Minister of Defense Liang Guanglie 

traveled to Bogotá, Colombia, on the first stop of a three-nation visit to 

Latin America, meeting with Colombian Defense Minister Rodrigo Rivera and other senior Colombian officials and signing a defense cooperation 

agreement.23

• Following his visit to Colombia, Minister Liang traveled to Brasilia, where 

he met with Brazilian Defense Minister Nelson Jobim,24 reciprocating a visit 

paid by Jobim to China at the beginning of the same month.25

• The third leg of the September 2010 trip by Minister Liang took him to 

Mexico, where he met with the senior leadership of both institutions of the 

Mexican armed forces: The Ministry of National Defense (SEDENA) and 

the Ministry of the Navy (SEMAR).26

• In November 2010, Chief of Staff Chen traveled to Quito, Ecuador, on the 

first stop of a two-nation visit, meeting with the Ecuadoran Minister of Defense Javier Ponce as well as the head of Ecuador’s Joint Chief of Staff, Luis 

Ernesto Gonzalez.27

• In the second stop of his trip, General Chen traveled to Caracas, where 

he met with his Venezuelan counterpart, Defense Minister Carlos Figueroa, 

and to prepare the military portion of the agenda for the 9th annual ministerial-level meeting of the “China-Venezuela High-Level Mixed Commission,” 

held in Beijing during the subsequent month.28

• In December 2010, Chinese Defense Minister Liang Guanglie met with Lamure Latour, Minister of Defense of Suriname, in Beijing.29

• In May 2011, Peruvian Defense Minister Jaime Thorne met with Chinese 

Defense Minister Liang Guanglie and Vice Chairman of China’s Central Mil-
92 The Strategic Dimension of Chinese Engagement with Latin America

itary Commission Xu Caihou to address the issue of expanding bilateral 

defense cooperation.30

• In June 2011, the Chilean Minister of Defense met with his counterpart, 

Chinese Defense Minister Liang Guanglie, in Beijing to discuss, among other issues, security cooperation between the two in the Asia-Pacific region.31

• In October 2011, Guo Boxiong, a Vice-Chairman of China’s Central Military Commission and party member, met with General Leopoldo Cintra 

Frias, Cuban Defense Minister, as well as Cuban President Raul Castro, in 

Havana, Cuba.32

• In December 2011, Armando Pacheco, Commander of the Armed Forces of 

Bolivia, traveled to China and met with Chen Bingde, Chief of the General 

Staff of the Chinese People’s Liberation Army, and his subordinate, Xu Caihou, a Vice Chairman of China’s Central Military Commission. The Chinese 

public account of the meeting specifically mentioned a commitment to expand military exchanges.33

• In September 2012, Joaquin Quintas, Vice Minister of Cuba’s Armed Forces, met with Chinese Defense Minister Liang Guanglie and Vice Chairman 

of the Central Military Commission Guo Boxiong.34

• In September 2012, the Commander-in-Chief of the Chilean Air Force met 

with Chinese Defense Minister Liang Guanglie in Beijing. They discussed, 

among other issues, the expansion of ties between the air forces of the two 

nations and the associated expansion of cooperation in training activities.35

• In November 2012, senior defense officials from six Latin American countries, including Bolivia, Cuba, Colombia, Ecuador, Peru, and Uruguay, met 

with their Chinese colleagues in Beijing in the “1st China-Latin America 

High-level forum on Defense.”36 Attendees included the Chinese Minister 

of Defense Liang Guanglie and the Commander-in-chief of the Uruguayan 

army Pedro Siqueira.37

Although little of the substance of the discussions during these visits 

makes it to the open press, their role in advancing military relationships between 

China and the Latin American counterpart nations have arguably been greater 

than is generally recognized: such visits allow the leaders involved to build familiarity and confidence by speaking face-to-face and to explore possibilities for 

future projects, from arms sales to expanded military exchanges. Such visits also 

generally include tours of host nation facilities and opportunities for informal 

discussion, raising possibilities for collaboration based on issues that have captured the attention of the leaders within the limits of their national policies. In 

some cases, initiatives prepared prior to the trip by staff officers or other officials 

are ratified during the high-level visit, while ideas generated during discussions 

become initiatives to be subsequently explored, administratively driven by the 
R. Evan Ellis 93

declared interest of the senior leadership.

Lower-Level Military-to-Military Interactions

In the past several years, the PRC has expanded the quantity and scope of its military-to-military contacts at the institutional level, including its ongoing participation in the peacekeeping mission in Haiti and an increasing number of personnel exchanges for training and education, joint exercises, institutional visits, and 

symbolic activities. In each of these, the primary value for the PRC is arguably 

building relationships at the institutional level as well as at the personal level with 

future key figures in Latin American militaries. In the process, it has also been 

able to increase its understanding of Latin American militaries and the security 

environment of the region.

In Haiti, military police from the People’s Liberation Army served as part 

of the United Nations peacekeeping force (MINUSTAH) present in the country 

from September 2004 through the withdrawal of the last Chinese peacekeepers 

in October 2012.38 Haiti also has the dubious distinction of having been the site 

of the first officially recognized Chinese military casualties on Latin American 

soil. Eight members of the PLA were among the personnel killed in Haiti in 

January 2009 in conjunction with the earthquake that devastated the country.39 

Four of the Chinese killed were members of the MINUSTAH police force, while 

the other four were part of a six-person working group from the Ministry of 

Public Security that was visiting the United Nations headquarters facility when 

its roof collapsed because of the earthquake.40 The bodies of the victims were 

subsequently returned to the PRC, where they posthumously received various 

honors.41 

The participation of the Chinese military in MINUSTAH for eight years 

until their September 2012 withdrawal arguably yielded great benefits for the 

PRC. It has given the People’s Liberation Army (PLA) and hundreds of its soldiers first-hand experience operating in the Latin American environment in a 

police and security role—something which will be of particular value in the 

future if China begins to provide security assistance to allies in the region in 

support of the protection of its nationals and ongoing operations. In addition, 

its presence in MINUSTAH allowed the PLA to better understand and build 

relationships with the militaries of Brazil and other nations working alongside it 

in the operation, even while fostering goodwill in the region toward the PLA as 

a contributor to the international order. Finally, the Chinese military presence 

in Haiti also arguably advances its effort to secure diplomatic recognition in the 

country.42

In the realm of training and military education, Chinese institutions 

host Latin American military personnel from virtually every country in the region with which the PRC has diplomatic relations The examples listed in the fol-
94 The Strategic Dimension of Chinese Engagement with Latin America

lowing paragraphs are illustrative, although neither a complete, nor necessarily a 

representative, list.

The National Defense University of the PLA has multiple institutions 

offering courses in both English and Spanish to Latin American officers. These 

include:

1. The Defense Studies Institute in Changping (near Beijing), a school especially for foreigners within the broader university, offering courses in both 

Spanish and English, including the following:

• A five-month-long senior staff course, taught primarily in Spanish. The 

course, through a combination of Chinese instructors and Communist-party vetted translators. Latin American nations sending officers 

have included Mexico, Peru, Chile, Colombia, and Uruguay. The Chilean Army has been sending officers to the course since 1999, while the 

Uruguayans have been sending students since at least March 2009.

• A three-month long course on strategy, campaign planning, and military thinking, attended by officers of the Chilean Navy, among others, 

since 1997.

• A ten-month long course on “national defense and command,” taught in 

English, and attended by officers from the Peruvian Army, the Chilean 

Navy and Air Force, and the Uruguayan Navy and Air Force, among 

others.43

• A five-month long course on military strategy, taught in Spanish, and 

attended by Peruvian army officers and Chilean air force personnel, 

among others.

2. The Army Command College, located in Nanjing, offers a four-month 

course in English and French, which has been attended by military officers 

from Latin American countries including Colombia, Peru, Barbados, and 

Jamaica, as well as Africa and other regions.

3. The Chinese Navy Command School, outside of Nanjing, offers a year-long 

senior command course in English. The course has been attended by Latin American military officers, among others, including officers from Uruguay44 and Brazil.45

4. In a facility near Shijiazhuang:

• A five-month course on Special Forces operations at the tactical-operational level. It has been attended by officers from Uruguay for at least 

the past two years, and perhaps by members from other armed forces.

• A five-month long infantry company course, attended by an officer 

from Uruguay in 2010, and perhaps others.

5. The Center of Military Instruction of the PLA offers a course on martial arts 

that has been attended by Chilean Marines, among others.

6. Other Chinese military institutes that have also hosted students from Latin 
R. Evan Ellis 95

American countries include the following:

• The Naval Research Institute, near Beijing, which hosted a low-ranking 

officer from the Uruguayan Navy, and perhaps others, for a “masters” 

course in naval radar and sonar, during an 11-month long stay in Beijing 

from 2008 to 2009.

• An institute in Beijing hosted two low-ranking officers from the Uruguayan Air Force, and perhaps others during an 11-month stay in the 

city from 2008 to 2009—one for a “masters” course on aerial communication and one for a course on artillery repair.

Parallel to these programs, but on a much smaller scale, Latin American militaries also have hosted Chinese officers in their institutions. Examples 

include the following:

1. For several years, beginning in 2005, the Chilean Army language school 

hosted two Chinese professors for the Mandarin Chinese language,46 although as of January 2011, these instructors were no longer present.

2. In 2006, during a visit by a delegation from the Chinese National Defense 

University, the Chilean National Academy of Political and Strategic Studies 

(ANEPE) signed an agreement regarding officer exchanges and collaborative activities, although it has not yet been ratified.

Chinese collaboration with Latin American militaries on education and 

training is increasingly extending to tactical-level programs as well. During the 

November 2010 meeting between Chinese Defense Minister Liang Guanglie and 

Colombian Defense Minister Rodrigo Rivera, an expansion of Sino-Colombian 

military exchanges was agreed to, including the establishment of 10 places for 

Colombian generals and colonels in Chinese military academies and the sending 

of Colombian trainers to China for courses in sharpshooting, combat diving, 

survival, and riverine combat.47 By 2012, groups of Chinese officers were attending tactical training programs in Colombian bases such as Tolemaida. Similarly, during General Liang’s September 2010 meeting with Brazilian Defense 

Minister Nelson Jobim, expanded cooperation between the two countries in the 

area of basic training was discussed.48 In addition to opportunities for building 

personal relationships and gathering intelligence, such tactical-level courses also 

help the PRC to develop military capabilities in areas that may be useful in working more directly in the region’s unique operating environments.

An additional element of China’s construction of military relationships with Latin America is institutional visits. Such visits typically involve more 

people, but are much shorter in duration than training exchanges. Although the 

opportunities to develop personal ties are by necessity more superficial, such 

institutional visits allow the PRC to reach larger groups of personnel whose 

work touches many others, such as military professors and mid-grade officers, 

while also building or strengthening institution-to-institution linkages. Examples 
96 The Strategic Dimension of Chinese Engagement with Latin America

include the following:

• Visits between Chinese and Chilean naval officers have occurred on an occasional basis since July 1996, but increased to one or two per year starting 

in 2005.

• In Argentina, there has been a similar increase in recent years, including 

visits by Chinese officials to the Argentine National Defense University and 

the senior war colleges.

• In Colombia, delegations from China’s National Defense University visit the 

nation’s war college on an annual basis.

• Visits by Peruvian officers occur on a regular basis, including a visit by a 

group from the Centro de Altos Estudios Nacionales in November 2012.

Beyond institutional visits, other ongoing contacts between Chinese 

and Latin American militaries include port visits by military training ships and 

warships by each side. The first such visit was made by the Chilean Navy training 

ship Esmeralda to the Port of Shanghai in 1972. By 2009, the Esmeralda had made 

10 trips to Chinese ports. Reciprocally, in April 1997, the first Chinese naval 

flotilla visited Latin America. It included the missile destroyers Harbin and Zhuhai and the logistics ship Nancang, and made a port calls in Mexico, Peru, and 

Chile, as well as the US base at Pearl Harbor.49 The most recent such visit, at the 

time of this writing, came in 2009 from a Chinese naval flotilla that included the 

destroyer Shijiazhuang and the supply ship Hongzehu, making port calls in Valparaiso, Chile; Callao, Peru; and Guayaquil, Ecuador.50 Although nonthreatening 

in character, such visits benefit the PLA Navy, helping it to identify requirements 

for the use of Latin American ports by its ships in the future for maintenance, 

resupply, or other purposes.51

In addition to bilateral contacts, such as those mentioned above, Chinese and Latin American militaries have occasional contact through conferences 

and other forums. The Chilean and Chinese navies, for example, have regular 

contact through the Western Pacific Naval Symposium, with the PRC having supported Chile’s admission to the organization.52 The Chinese, for their part, host 

various forums to which Latin American officers are invited, including an annual 

“symposium for upper level officers” in Beijing, which has been held at least five 

times. In addition, from November to December 2007 in the city of Qingdao, 

the headquarters of the PLA North Sea fleet, the Chinese held a seminar on the 

management of search and rescue operations in which a Uruguayan naval lieutenant, and perhaps other Latin American military officers, were present.

It is also important to mention Chinese military actions in Latin America, which are important primarily at the symbolic level. These include September 16, 2010, when an honor guard of 34 persons from the PLA participated 

alongside representatives from 15 other countries in a parade in Mexico City in 

commemoration of the 200th Anniversary of Mexico’s independence.53
R. Evan Ellis 97

Military-to-military contacts also have come to include bilateral exercises. In November 2010,39 Chinese military personnel participated with 50 

Peruvians in the humanitarian exercise “Angel de la Paz,” including deployment 

to the village of Villa Maria del Trunfo to perform medical services for the local 

population.54 The joint exercise simulated a response by the two armed forces 

to an earthquake, with an associated chemical fire,55 and was tied to the donation 

by the PLA to the Peruvian military of a mobile field hospital, and training of the 

recipients on its use in the facilities of the 1st Special Forces Brigade in Chorrillos, near Lima.56

In December 2011, the PLA took a third major step in expanding its 

military activity in the region when it deployed the recently completed PLA 

hospital ship, N866, to the Caribbean.57 The ship, dubbed the “Peace Arc” made 

port calls in Cuba, Jamaica, Trinidad and Tobago, and Costa Rica as part of “Harmonious Mission 2011.”58 In those ports, it treated a range of medical conditions 

by the local populations, including local military and government officials, and 

hosted local dignitaries and press on board.59 As with the “Angel de la Paz” humanitarian exercise in Peru, the deployment of the Peace Ark was widely covered 

in the local press throughout the Caribbean, generating a significant amount of 

public attention, and presumably, goodwill toward the Chinese. On November 

24, on its way back to the PRC, it also made a stop in the southern Chilean port 

of Punto Arenas, where it provided medical services to the local population.60

While not threatening in and of itself, Chinese participation in humanitarian activities in Latin America may be understood as a logical step toward 

its participation in the response to an actual disaster, outside the framework of 

a multilateral force such as the United Nations. Such an offer of direct military 

involvement in a Latin American country would put US policymakers in an awkward position, since publicly blocking humanitarian assistance from the PRC 

could be construed as increasing the number of Latin American deaths from the 

disaster in order to keep the Chinese military “out of the US backyard.”

Military Sales to Latin America

As with military sales by other countries, Chinese military sales to Latin America 

help the PRC to strengthen its ties with the purchasers by meeting their specific 

needs and by tying those nations to Chinese logistics, maintenance, and training 

infrastructures. Such transactions also help the PRC to develop and sustain its 

own national defense industry and earn export sales revenues.

Rightly or not, Chinese arms sales to Latin America are arguably some 

of the most closely watched facets of China’s engagement with Latin America. 

Although U.S. leaders such as Assistant Secretary of Defense Frank Mora have 

observed that Chinese arms sales can contribute to security in the hemisphere,61

many politicians and other policymakers look to such sales as indications that 
98 The Strategic Dimension of Chinese Engagement with Latin America

Chinese activities in the region constitute a threat to U.S. National Security.

In general, PRC military sales to Latin America have followed the pattern of its commercial sales. The first Chinese defense goods sold in the region 

were relatively inexpensive, unsophisticated items such as military clothing and 

personal equipment. In some cases, such goods entered Latin American militaries as donations, such as the $1 million per year in hats, gloves, and other 

nonlethal equipment donated by the PLA to Colombia. Frequently, Chinese 

goods have been offered by third-party importers representing companies such 

as NORINCO in the PRC, but licensed to do business with Latin American militaries.

At first glance, two facets of China’s advancing military sales to the 

region stand out. First is the degree to which sales of major military end items 

have generally correlated with the anti-US foreign policy orientation of the purchasers, with China’s major customers in the region being Venezuela, Ecuador, 

and Bolivia, and to a lesser extent, Argentina, Suriname, and Guyana.

Second, the number of problems that the PRC has had in its attempt 

to sell goods to the region has been particularly striking. These include contract 

disputes that have led to suspended procurements in Ecuador (over the purchase 

of a Chinese radar) and Argentina (over an armored vehicle), the crash of a recently delivered fighter in Venezuela, and the cancellation of publicly announced 

procurements of Chinese goods by Peru (MBT-2000 tanks) and Argentina (the 

X-11 helicopter), among others.

As with commercial goods, China’s ability to sell sophisticated military 

hardware to Latin America has been impeded by concerns over quality as well as 

the difficulty of maintaining and supporting the equipment. Such concerns have 

been particularly acute with respect to goods such as ships, aircraft, armored 

vehicles, weapons, and communication systems, in which lives on the battlefield 

could depend on the proper functioning of the equipment. The lack of a Chinese 

military presence in the region has compounded such concern; the absence of 

sales of Chinese gear in Latin America meant that Chinese military goods were 

“unproven” in the region, and thus more difficult to sell. Moreover, without a 

Chinese military presence in the region, maintenance and obtaining spare parts 

for Chinese goods was, in the minds of many leaders, a great risk.62

Despite such obstacles, as in the commercial realm, with time the PRC 

and its defense companies have begun to move up the value-added chain to sell 

increasingly high value-added military goods in Latin America. In doing so, it 

has leveraged opportunities provided by regimes hostile to the US, such as Venezuela, Ecuador, and Bolivia, whose political orientation and inability to acquire 

Western military technology has led them to look to Chinese equipment.

The first major breakthrough for the PRC in military sales to Latin 

America was arguably Venezuela’s 2008 announcement that it would purchase 
R. Evan Ellis 99

K-8 (Karakorum) aircraft, codeveloped with Pakistan.63 Venezuela’s decision to 

purchase the aircraft was driven in part by its inability to purchase US fighters 

or spare parts for its existing fleet of US aircraft, as well as successful US efforts 

to block other Western countries from selling to Venezuela similar aircraft that 

incorporated US technology.64 The agreement to ultimately purchase a total of 

18 K-8 aircraft from China National Aero-Technology Import and Export Corporation (CATIC), along with armament and a supporting logistics package, was 

made in August 2008. In the second half of 2009, 11 Venezuelan pilots and 56 

technicians were sent to China for training on the aircraft as pilots and maintenance and logistics support staff.65

The first 6 K-8s were officially received in March 2010,66 with the 

other 12 arriving in August. They were initially assigned to the 12th fighter Air 

Group, based at the air base Rafael Urdaneta de Maracaibo, and to the 15th Special 

Operations group, at the air base Vicente Landaeta Gil de Barquisimeto.

67 Based on 

Venezuelan satisfaction with the transaction, the government initially announced 

its intention to expand the number of K-8s to be purchased to 40, although the 

final order appears to have been 18.68

Despite highly positive statements by the Venezuelan leadership regarding the K-8s, the acquisition has had its problems. In January 2010, one of the 

K-8s piloted by a newly trained Venezuelan crashed on takeoff out of the military airport in Barquismetro, near Caracas.69 While the Chinese blamed improper maintenance by the recently trained Venezuelans, the Venezuelans pointed the finger at the Chinese for poor translations of the aircraft technical manuals 

into Spanish. In addition to the K-8s, the Venezuelan military leadership was also 

reportedly evaluating purchase of the more capable Chinese L-15 Air King, with 

a proposal by Hongdu Aviation Industry Corporation to sell the PRC 24 of the 

aircraft,70 although the matter has not been discussed publicly since 2009.

Beyond fighters, the government has also purchased 8 Y-8 Chinese 

medium military transport aircraft, each capable of carrying up to 88 persons or 20 tons of cargo.71 The first two aircraft were delivered in November 

2012,72 with the remainder delivered over the period December 2012–January 2013. In August 2012, the first group of Venezuelan pilots and ground 

crew personnel were sent to the PRC to receive training on the new aircraft.73

Finally in 2010, Venezuela also agreed to buy Y-12 aircraft and two helicopters from the Aviation Industry Corporation of China. The deal, worth approximately $300 million, involved the purchase of 27 Y-12s produced by the 

manufacturer Hafei to be used for the transport of passengers and cargo in the 

interior of Venezuela,74 as well as two helicopters.75

Beyond manned aircraft, Venezuela has also evaluated purchases of Chinese Unmanned Aerial Vehicle (UAV) systems. In January 2009, for example, 
100 The Strategic Dimension of Chinese Engagement with Latin America

the Chinese firm Poly Technologies presented a proposal to the government of 

Aragua for the sale of CH-3 UAVs and control stations, culminating in a demonstration flight to the leadership of the Venezuelan Air Force in January 2010.76

The marketing material for the UAVs provided by the Chinese touts their ability to “defend strategic installations.” Correspondingly, the Venezuelan state of 

Aragua, where the UAV was being marketed, is in or near two of the ground 

control facilities of the new PRC-launched Venezuelan satellite: Camatagua and 

El Sombrero (the “Manuel Rios” military base). Although the Venezuelan military 

ultimately turned to Iran to help produce the UAV,77 Venezuelan President Hugo 

Chávez said in a televised public statement that the PRC had an undisclosed role 

in UAV production.78 

In addition to aircraft, Venezuela has also indicated an interest in purchasing Chinese ground vehicles. In July 2012, President Chávez announced that 

Venezuela would purchase $500 million in armored amphibious vehicles from 

the PRC.79 The vehicles reportedly included light amphibious tanks, infantry 

fighting vehicles, armored personnel carriers, and self-propelled artillery. The 

Venezuelan armed forces were reportedly reorganizing to accommodate the 

new equipment, creating a new “3rd Marine Infantry Brigade” and restructuring 

the existing 4th Marine Infantry Brigade.80 In September 2012, Venezuela took 

arms sales from the PRC one step further, announcing the purchase of 8 Harbin 

Z-9C antisubmarine patrol aircraft from NORINCO.81

Beyond the equipment mentioned above, Venezuela has also spearheaded the introduction of Chinese radars into the region. In 2005 the Venezuelan air 

force acquired JYL-1 radars, usable for air defense from the firm China National 

Electronics Import and Export Corporation (CEIEC), at a cost of $150 million.82

The radars were acquired by the Venezuelan organization Compañía 

Anónima Venezolana de Industrias Militares (CAVIM), with the first delivered in January 2008, subsequently put under the command of the Venezuelan Air Force. 

They were used publicly for the first time in 2008 in an exercise with Brazil. 83

The Chinese also installed a command and control center for the Venezuelan radars in a military base near Caracas at the end of 2008. Between April 

and August of the same year, Venezuela sent a total of 70 officers to the PRC for 

training on the operation and maintenance of the system.84 By mid-2009 the 

Venezuelan military leadership was referring to a total of 10 Chinese radars being operational,85 and as of June 2009 Venezuela was evaluating the purchase of 

other Chinese radars to complement the capabilities of the JYL-1s.86

In addition to the radars and aircraft, the Venezuelans have also contracted with the Chinese for the construction of military command and control 

facilities, with the Venezuelan defense organization DICOFAN working with the 

Chinese civilian telecommunications firm Huawei to implement the system.87 In 
R. Evan Ellis 101

support of the system, China has also funded a training program by Huawei for 

students of the Venezuelan military institute Universidad Nacional Experimental 

Politécnica de las Fuerzas Armadas (UNEFA),88 as well as the construction of a $54 

million laboratory in the Venezuelan Armed forces technical university Instituto 

Universitario Militar de Comunicaciones y Electrónicas de las Fuerzas Armadas (IUMCOELFA).

In addition, by the end of 2010 the Venezuelan military leadership were 

evaluating the purchase of a broad range of Chinese systems, including command 

and control systems, HF, UHF, and VHF communications systems, IGLA missile 

systems, anti-aircraft guns, biodegradable mines, water purification equipment, 

bridging equipment, utility aircraft, antisubmarine aircraft, ground-attack aircraft, long-range sea surveillance aircraft, coastal patrol aircraft, frigates, submarines, and anti-submarine warfare (ASW) helicopters.

Beyond purchases of PRC military hardware, Venezuelan officials have 

also reportedly facilitated indirect purchases of military goods by criminal and 

insurgent groups such as the FARC. An investigation by the Colombian prosecutor’s office, for example, implicated the Venezuelan government official Amílcar 

Figueroa, presenting a “shopping list” of weapons for the FARC during his visit 

to the weapons manufacturer NORINCO in the PRC.89

In addition to direct purchases of military goods and systems from the 

PRC, Venezuela has greatly facilitated the ability of the PRC to sell its military 

end items to other like-minded governments in the region, including both Ecuador and Bolivia. Following the lead of Venezuela, in September 2009 Ecuador 

negotiated a deal with the PRC for two radars, manufactured by China Electronics Technology Corporation (CETC), to be deployed to its northern frontier 

with Colombia for evaluation, with the option to purchase an additional four 

units,90 and ultimately the purchase of four such radars at a cost of $80 million.91

The acquisition was subsequently suspended, however, over problems regarding 

the unsuitability of the radars for the jungle conditions into which they were deployed,92 with the Ecuadoran government pursuing legal action against the Chinese supplier for breach of contract, with the Chinese agreeing to a settlement 

in 2013.93

Beyond the radars, Ecuador has also explored the purchase of medium 

transport aircraft from the PRC. In July 2009, Ecuadoran Defense Minister Javier Ponce noted Ecuadoran interest in purchasing four military aircraft from the 

PRC for $60 million to replace its aging fleet of Brazilian Avro military transport 

aircraft.94 Although no purchases immediately followed the declarations, during 

the February 2010 visit to China by Chairman of the Ecuadoran Joint Chiefs of 

Staff General Fabian Varela, the PRC mentioned again that it was investigating 

the possibility of providing Ecuador with four MA-60s,95 at a price of $80 million.96 Subsequently, in August 2010 Ecuadoran Minister of Defense Javier Ponce 
102 The Strategic Dimension of Chinese Engagement with Latin America

announced that he was sending a delegation to the PRC to negotiate the purchase 

of two of the MA-60s for $38 million, to be delivered by the end of the year.97 In 

2011, however, the procurement was abandoned by Ecuador, reportedly following a prolonged inability to come to an agreement with the PRC regarding the 

technical specifications of the aircraft.98 

In addition to these transactions, the PRC has also donated military 

trucks and ambulances and other non-lethal goods to Ecuador. Indeed, during 

the February 2010 visit by General Varela to the PRC, China mentioned that they 

planned to double such donations.99

Bolivia, in contrast to Venezuela and Ecuador, has a relatively long history of military equipment purchases from the PRC. Such purchases included 

HN-5 man-portable anti-aircraft missiles, purchased from China in 1997 and 

ultimately disposed of by then–acting Bolivian President Eduard Rodriguez Veltze shortly before he turned over power to incoming president Evo Morales, unleashing a storm of controversy within the country and a criminal investigation 

against Rodriguez Veltze.100 In addition, during the period 1987–1996, the PRC 

reportedly provided 10,000 AK-47 assault rifles to the nation’s armed forces.101

Beyond such historical antecedents, under the presidency of Evo Morales, Bolivia has also followed the lead of Venezuela in acquiring military aircraft 

from the PRC. Aided in part by the personal recommendation of Venezuelan 

president Hugo Chávez to his colleague Evo Morales in October 2009, Bolivian Defense Minister Walker San Miguel announced the planned purchase of a 

squadron (6) of Chinese K-8 aircraft, for $58 million.102 The aircraft, the first 

combat aircraft acquired by the Bolivian military,103 were formally ordered from 

China in 2011 with the announced use as trainers, and in an air-intercept role 

against drug traffickers.104 The deal was financed with a 25-year concessional 

credit, with the aircraft delivered in August 2011.105 Upon receipt, they were 

reportedly deployed in the vicinity of Cochabamba for counterdrug interception 

missions, and represent the first combat aircraft acquired by the Bolivian military.106

Although the K-8s are Bolivia’s first fighters, they are Bolivia’s second 

transaction with the PRC involving aircraft for its military. In March 2007, Bolivia announced the leasing of two MA-60 military cargo and passenger aircraft 

from the PRC as part of a larger deal that included the acquisition of military 

transport aircraft from Venezuela.107 The Chinese MA-60 aircraft were paid for 

by a $38.3 million loan from the PRC108 and delivered in February 2008.

Beyond the K-8s, in 2012 Bolivia became the first nation in the Americas to purchase Chinese military transport helicopters, ordering six H-425s for 

$108 million109 through a 20-year concessional loan at 2 percent interest.110 Although the official mission of the helicopters was civilian logistics and disaster 

relief, they were to be managed by the Bolivian military, implying a Chinese re-
R. Evan Ellis 103

lationship with the Bolivian armed forces for the maintenance of the helicopters 

as well.

In addition to its purchase of end-items, Bolivia has also received a series of donations of other military goods from the PRC. These donations have 

come in four major installments: In December 2006, the PRC announced the 

donation to Bolivia of 25-person assault craft, infantry and artillery munitions, 

night-vision goggles, and Kevlar helmets.111 In 2007 the Bolivian armed forces 

received 34 trucks from the manufacturer First Auto Works (FAW), five buses, 

three Toyota Land Cruiser SUVs, and a tow truck.112 In February 2009 it received 

2 gunboats from the PRC. 113 In March 2010 it received 27 buses for military 

transport, manufactured by the Chinese company Hinger, 21 Nissan light trucks, 

and 40 Yamaha outboard motors.114 The most recent donations, as of the time this 

went to press, focused on military engineering and road construction, including 

the March 2012 delivery of 274 pieces of heavy equipment, financed by a $40 

million loan from the PRC, to outfit Bolivian engineering battalions forming 

the new Army Construction Command to build transportation infrastructure in 

the country.115 Similarly, in May 2012 the Bolivian military agreed to accept the 

donation of $3 million in Chinese communications equipment.116

Although the most significant arms transactions between the PRC and 

Latin America have come in the “socialist” countries of the ALBA block, significant advances and near-advances have occurred in other countries as well. The 

most active and persistent interest in such purchases have arguably come from 

Argentina. In 2007, the country was reportedly considering purchase of the Chinese X-11 helicopter,117 as well as military trucks and radars to provide coverage 

for the Northern frontier.118 The military truck purchase apparently never occurred, and the helicopter acquisition was derailed when France, a major supplier 

to the Argentine armed forces, claimed that the Chinese product was an illegal 

copy of a similar helicopter marketed by Eurocopter and threatened to take actions against the Argentine military if they purchased the Chinese helicopter.119

Despite the difficulties with the Chinese armored vehicles, in July 2012 

the Argentine Defense Minister Arturo Puricelli announced an even more significant procurement from the Chinese, a Chinese helicopter that would be jointly 

produced in the province of Cordoba in the south of Argentina.120 Because the 

helicopter would be manufactured on Argentine soil, the implied presence of 

Chinese military and technical personnel in association with the project would 

be significant if the project went forward.

In addition to the abovementioned procurements, in 2008 the Argentine 

military initiated a procurement of WMZ-551 wheeled armored vehicles from 

the Chinese manufacturer NORINCO in order to outfit a mechanized battalion 

that was the Argentine contribution to the joint Argentine-Chilean peacekeeping 

force “Cruz del Sur.” In 2008 the Argentine Joint Staff purchased four of the vehi-
104 The Strategic Dimension of Chinese Engagement with Latin America

cles for evaluation for a price of $2.6 million, including a training and spare parts 

package.121 The vehicles initially saw service with the Argentine mechanized battalion in Gonaives, Haiti, where the Argentine combined mechanized battalion 

was deployed as part of the UN peacekeeping force MINUSTAH.122 Problems 

with the WMZ-551s, however, led Argentina to suspend the procurement after 

receipt of the first four vehicles.123

Beyond Argentina, Peru has publicly contemplated acquisition of several different major end items from the PRC although, to date, none of the 

procurements have gone forward. In 2009, Peru almost became the first nation 

in Latin America to make a major purchase of armored vehicles from the PRC. 

A series of five Chinese MBT-2000 tanks were accepted from the PRC for evaluation by the Peruvian army and were featured prominently in a military parade 

in December 2009,124 followed by an announcement by then Peruvian Defense 

Minister Rafael Rey that a significant number of the tanks would be purchased 

for the Peruvian army. Amidst public controversy over the procurement, however,125 difficulties emerged with the ability of the Chinese producer to acquire 

the associated tank engine from its Ukrainian supplier, ultimately driving the 

Peruvian government to cancel the procurement,126 with the Peruvian Minister 

of Defense announcing that resources earmarked for the acquisition would be 

reprogrammed to dedicate more resources to fighting narcotraffickers and recuperating state presence in the Apurimac and Ene Valley Region (VRAE) in the 

interior of the country.127

Despite such setbacks, public evidence suggests that Chinese contractors continue to work actively to sell their products to the Peruvian Ministry 

of Defense. In 2012, for example, the Chinese firm China Precision Machinery 

Import-Export Corp (CPMIEC) was revealed to be one of the bidders in an air 

defense system for the Peruvian government. Although they lost the bid to a 

consortium led by Northrup-Grumman, they were sufficiently sophisticated in 

operating in the Peruvian defense market, so as to freeze the process by contesting the contract award.128

Beyond procurements, as noted previously, in 2010 Peru was also the 

recipient of the first major donation of military humanitarian equipment from 

the PLA, with the delivery of a mobile field hospital and other equipment during 

the second half of 2010. The donation had a total value of $300 million and included the training of Peruvian personnel on the equipment, culminating in a 

joint Chinese-Peruvian humanitarian exercise in November of that year. Since 

the delivery of the hospital, however, the unit has reportedly been dismantled, 

and its components distributed for use to various parts of the Peruvian armed 

forces. At a lower level, Peru has also purchased Chinese non-lethal equipment, 

and in 2007 signed defense accords with the Chinese to allow them to participate 

more directly in the Peruvian military acquisition system.129
R. Evan Ellis 105

Peru has not, however, been the only US ally in the region to consider 

major purchases of Chinese military equipment. Since as early as 2006, Chinese 

military officials have discussed the possibility of selling armored vehicles and 

other equipment to the Colombian military.130 To date, Colombia has not pursued such transactions, in part due to concern over complications in the maintenance and support of such equipment and also because of the close Colombia-US 

defense and security relationship.

Beyond explicit military sales, both the Uruguayan police and the Peruvian National Police (PNP), and perhaps other police forces in the region, have 

explored purchases of Chinese equipment. The police force in Montevideo, for 

example, has purchased police cruisers of the Chinese brand Geeley.131 Similarly, 

in August 2007 the PNP contracted with a South Korean intermediary for the 

purchase of 700 Geeley police cars.132 As with the military sales, however, the 

transaction came under significant public scrutiny, and was eventually canceled.

At a lower level, as noted previously, the Colombian military has also 

been the recipient of approximately $1 million per year of non-lethal equipment, 

including gloves and winter hats to equip Colombian high-mountain battalions. 

In September 2010 the Colombians and Chinese affirmed and deepened that 

relationship with the signing of a defense cooperation accord.133 What had been 

an annual low-level flow of gear134 was modestly expanded in June 2012 when Colombian and Chinese armed forces signed a one-time agreement for the donation 

of $7 million in Chinese military gear to Colombia.135

Beyond Colombia, the PRC has quietly provided modest quantities of 

military goods and training to nations throughout the Caribbean basin, including Jamaica, Suriname, and Guyana. In January 2012 the Jamaica Defense Force 

(JDF) received a gift of $7.5 million in non-lethal gear from the PRC.136 The donation came shortly after an operation in which the JDF had to re-take the Tivoli 

Gardens neighborhood in the capital, Kingston, by force, raising significant international criticism of the Jamaican government as well as exposing deficiencies 

in the capabilities of the JDF, with the consequence that the military aid from 

China was warmly received because of the vote of confidence that it represented 

in the Jamaican government.137

With respect to Guyana, in March of 2012 the nation became the first 

to implement an in-country flight training program, run by Chinese personnel, 

to impart training on Chinese aircraft previously purchased by the Guyanese 

defense force.138 The program arguably represented a significant increase in the 

level of contact between the PLA and the small core of officers of the Guyanese Air Force. With respect to Suriname, like Jamaica and Guyana, the PRC has 

provided a modest amount of logistical goods and other materials,139 which has 

proven particularly important for the country given the suspension of aid from 

traditional benefactors, such as the Dutch.140
106 The Strategic Dimension of Chinese Engagement with Latin America

Beyond the aforementioned countries, Costa Rica is also a strong candidate for the receipt of Chinese equipment and other assistance for its security 

forces. In November 2010, during a visit to Beijing, Costa Rican Prime Minister 

Rene Castro made a formal request to China for assistance in training and equipping its national police for operations against narcotrafficking.141 The Chinese are 

currently building a new training center for the national police in San Jose.

In the case of Brazil, which has its own well-developed defense industry, 

there have been no significant purchases of Chinese military hardware. The possibility of China-Brazil coproduction of military goods was discussed during the 

September 2010 meeting between Chinese Defense Minister Liang Guanglie and 

his Brazilian counterpart Nelson Jobim in Brasilia,142 but no concrete projects 

have gone forward.

There have also been some suggestions that Chinese small arms have 

made their way into the arsenals of Latin American countries. A version of the 

Colt M-4 rifle, manufactured by the Chinese arms conglomerate NORINCO as 

the CQ-M4 was reportedly spotted in 2008 photos of activities by the Paraguayan armed forces.143

Chinese Physical Presence within Latin America with MilitaryStrategic Implications

To date, the PRC has been extremely cautious to avoid establishing an overt military presence in Latin America that could facilitate the emergence of a consensus 

within the U.S. and its allies to oppose PRC engagement with the region. Where 

it has done so, it has maintained a very low profile, or emphasized the scientific 

or nonmilitary character of that presence.

As noted previously, the PRC maintained a military police presence 

in Haiti as part of the MINUSTAH peacekeeping force from September 2004 

through October 2012.144 Such participation arguably provided a valuable learning experience and engagement opportunity. While far more benign than other 

forms of presence, such as military bases, its activities in Haiti allows the PRC 

to gain experience and develop contacts in the region, while fostering goodwill 

among Latin American militaries that could facilitate its military access to the 

region in the future.

In Cuba, the PRC reportedly has a presence in three Soviet-era monitoring facilities: Lourdes, Bejucal,145 and Santiago de Cuba.146 During the Cold 

War, because of their proximity to the US, the bases were used for the collection 

of signals intelligence, such as intercepting radio transmissions, and could be 

used for similar purposes today.

In addition to their explicitly military presence in Haiti and Cuba, the 

PRC also has a series of government-operated scientific bases in Antarctica, since 

establishing its first base there, “Great Wall,” in 1985.147 Although the sites are 
R. Evan Ellis 107

not military, they are supported by the PLA Navy, with the 1st Task Group, established in 2004 for the explicit purpose of supporting the base and conducting 

operations in the “Southern Ocean.”148

Although the frigid temperatures and remoteness of its Antarctic facilities from the majority of Latin American states limit their military utility, as with 

the presence of Chinese peacekeepers to Haiti, the Antarctic bases have provided 

opportunities to interact with the Argentine and Chilean militaries. The Chilean 

base in Antarctica, for example, is located in close physical proximity to that 

of the Chinese, providing opportunities for communication and collaboration 

there. In addition, some have speculated as well that the PRC presence in Antarctica may also strengthen its claim to exploit mineral deposits there,149 particularly when the current international treaty banning mining in Antarctica expires in 

2048.150

Beyond Haiti, Cuba, and Antarctica, the presence of Chinese logistics 

companies in major ports of the region arguably has some strategic military value, presenting a platform from which the PRC could smuggle people or material 

into the region under the cover of commercial operations, in the event that relations between the US and the PRC significantly worsen in the coming decades. 

Indeed, there is precedent for the use of Chinese commercial shipping for military purposes, from 1991 when the PRC enlisted the help of the commercial 

cargo ship Yongmen, owned by China Overseas Shipping Company (COSCO) to 

evacuate Chinese embassy personnel from Somalia.151

While it is important to acknowledge the long-term strategic military 

value of PRC physical presence in Latin America, it is also necessary to put it in 

proper context. It would be very difficult for the PLA to leverage this commercial presence to support their own projection of military power in the region, 

since commercial facilities cannot be readily transformed into military bases. 

Moreover, the proximity to the United States of any improvised military facilities would make them highly vulnerable to military action in the event of overt 

hostilities. Nonetheless, in such a “worse case” scenario of conflict between the 

United States and the PRC, such a presence would arguably allow the PRC to 

more easily deny the use of those facilities in the future for US and allied warships, or to disrupt commercial flows that support the US. The possibility that 

the firm Hutchison-Whampoa could use its port operations at Cristobal and 

Balboa, in the Panama Canal Zone, to close the canal to US warships exemplifies 

such concerns.152

Strategic Implications

The PRC military relationship with Latin America is not as insignificant as much 

of the current discourse suggests, yet the challenges that it presents are often 

mischaracterized to either establish, or dismiss a “China threat” to the region. 
108 The Strategic Dimension of Chinese Engagement with Latin America

From a US national security perspective, the most important dimensions of PRC military engagement with Latin America have to do with how the 

relationship is evolving as the PRC pursues its arguably legitimate national security interests, while remaining attentive to the United States, its most important 

strategic partner in the region. Chinese military interactions with Latin America, 

in and of themselves, are not necessarily a problem. The risk stems from what 

happens when the PRC, like the United States, is confronted with imperatives 

to protect its growing interests in the region in the face of organized crime or 

political turmoil that threaten its people, its investments in Latin America, or 

commercial flows, the disruption of which, by that time in the future, could 

cause serious damage to the Chinese economy. Equally troubling is how Chinese 

capital and weaponry could be used by populist regimes in the region hostile to 

their neighbors and the United States, or by terrorist groups and transnational 

criminal organizations. The principal risk is that such groups would acquire such 

weapons because of inadequate controls over them by the region’s governments, 

or because of inadequate attention by Chinese companies regarding to whom 

the weapons are ultimately being sold. Chinese arms sales and the PRC physical 

presence in Latin America also becomes problematic in the event that US-China 

relations degenerate, creating the paradox that US fears over how such weapons 

and ties could be used would contribute to the very friction between the two 

countries, which animosity could increase the possibility of their use.

Aside from such scenarios, even in the best of cases growing China–

Latin America military engagement means that the US will find its freedom of 

action in the region constrained in ways they were not in the past. Latin America increasingly has other options, beyond the US, for its security cooperation, 

arms purchases, and personnel training. This will change how the region’s governments bargain when it comes to access to bases, intelligence sharing, joint 

operations, and permission for US direct action in the region, particularly in areas such as counterdrug and counterterrorism operations. At a minimum, Latin 

American regimes will be more likely to resist agreeing to US requests that are 

perceived to violate their sovereignty.

Based on its behavior to date, it is likely that the PRC will continue to 

expand its military engagement with Latin America, including arms sales, which 

will increase in volume and sophistication, building on the demonstration of its 

equipment in the ALBA countries and leveraging key breakthrough transactions 

when they occur—whether with Peru and Colombia, or elsewhere—in order 

to introduce end items into the mainstream arms market of the region. In following this course, although the PRC will likely remain highly attentive to the 

US response, they are also likely to become bolder over time, particularly with 

the consolidation of power by President Xi Jinpeng and the new fifthgeneration 

of Chinese leadership, younger leaders who have grown up in a PRC that is an 
R. Evan Ellis 109

accepted political and economic power, confident of its place in the world.

Notes

1 This chapter is expanded and updated from the essay R. Evan Ellis, “China–Latin 

America Military Engagement” (Carlisle Barracks, PA: US Army War College Strategic 

Studies Institute, August 2011).

2 “Full text: China’s Policy Paper on Latin America and the Caribbean,” China View (Beijing, China, November 5, 2008).

3 For an example of the controversy, see “Panama Canal: America’s strategic artery,” 

BBC News (December 8, 1999). See also Nelson Chung, “US faces surprise attack with 

canal giveaway: Analyst,” Global Security (November 17, 1999). 4 See, for example, Kevin P. Gallagher and Roberto Porzecanski, The Dragon in the Room

(Stanford, California: Stanford University Press, 2010).

5 See Murray Scott Tanner, “How China Manages Internal Security Challenges and Its 

Impact on PLA Missions” in Beyond the Strait: PLA Missions Other than Taiwan, Roy Kamphausen, David Lai, Andrew Scobell, eds. (Carlisle Barracks, PA: US Army War College 

Strategic Studies Institute, April, 2009), 52.

6 See “II. National Defense Policy,” www.china.org.cn/english/features/book/194485.

htm.

7 David Lai and Mark Miller, “Introduction” in Beyond the Strait: PLA Missions Other than 

Taiwan, Roy Kamphausen, David Lai, Andrew Scobell, eds. (Carlisle Barracks, PA: US 

Army War College Strategic Studies Institute, April, 2009), 16.

8 See, for example, Editorial, “On the PLA’s Historical Mission in the New Stage of 

the New Century,” Jiefangjun Bao (January 9, 2006). For references for calls for the PLA 

to create a “strategic deterrent force” to protect its interests abroad, see PLA Daily editorial, “On the Military’s New Mission in the New Century” (January 9, 2006). Also see 

Luo Yabo, “A Scientific Interpretation of the PLA’s New Mission in the New Century,” 

Theoretical Studies on PLA Political Work, vol. 6, no. 3 (June 2005). For a good overview 

of the debate over how the PLA should defend its interests abroad, see David Lai and 

Mark Miller, “Introduction” in Beyond the Strait: PLA Missions Other than Taiwan, Roy Kamphausen, David Lai, Andrew Scobell, eds. (Carlisle Barracks, PA: US Army War College 

Strategic Studies Institute, April, 2009). 

9 “Petrolera china desestima que protesta en Tarapoa haya afectado sus intereses,” El 

Universo (Guayaquil, Ecuador, November 16, 2006). See also “Andes Strikes Deal, Ends 

Tarapoa Protests,” Rigzone (November 14, 2006). 10 “Heridos 24 militares en incidentes en protestas en Orellana,” El Universo (Guayaquil, 

Ecuador, July 5, 2007).

11 “Corredor logístico Manta-Manaos generará nuevas industrias locales,” El Universo

(Guayaquil, Ecuador, May 6, 2007).

12 “Los camioneros ratifican el boicot a los super y autoservicios chinos,” Clarin (Buenos 

Aires, Argentina, June 26, 2006).

13 Yolanda Ojeda Reyes, “Cuídanos chinos reciben protección,” El Universal (Caracas, 

Venezuela, November 11, 2004).

14 With global warming, in the future, this could also include the Straits of Magellan.
110 The Strategic Dimension of Chinese Engagement with Latin America

15 Christopher D. Young and Ross Rustici, “China’s Out of Area Naval Operations: Case 

Studies, Trajectories, Obstacles and Potential Solutions,” China Strategic Perspectives, no. 3 

(Washington, DC: National Defense University Press, December 2010).

16 Song Xiaojun, “Will China Send Forces to Somalia?” Blog commentary (December 

1, 2008).

17 David Lai and Mark Miller, “Introduction” in Beyond the Strait: PLA Missions Other than 

Taiwan, Roy Kamphausen, David Lai, Andrew Scobell, eds. (Carlisle Barracks, PA: US 

Army War College Strategic Studies Institute, April 2009). 

18 Information Office of the State Council, China’s National Defense in 2008, Beijing, 

PRC. See also Information Office of the State Council, China’s National Defense in 2006 

(Beijing, PRC, December 29, 2006).

19 For a good discussion about the Chinese approach towards “asymmetric warfare,” see 

Nichalos R. Reisdorff, “Winning the Hundred Battles: China and Asymmetric Warfare,” 

Masters Thesis ADA430913 (Ft. Leavenworth, KS: Army Command and General Staff 

College, June 6, 2003).

20 “Bolivia y China fortalecen cooperación militar,” Los Tiempos (Cochabamba, Bolivia, 

August 18, 2010).

21 “Militares Cubanos Visitan China,” Cuba a la Mano (September 4, 2010). 22 “Saludan fortalecimiento de cooperación militar entre Fuerzas Armadas de Perú y 

China,” Andina (November 23, 2010). 23 “China dona US$1 millón a Colombia para armamentos,” ABC (Asunción, Paraguay, 

September 6, 2010).

24 “Brazil Seeks Closer Defense Relationship with China: Defense Minister,” People’s 

Daily Online (Beijing, China, September 30, 2010). 25 “Chinese, Brazilian DMs Hold Talks on Military Cooperation,” People’s Daily Online

(Beijing, China, September 9, 2010).

26 “Chinese Military Open to More Int’l Cooperation: Senior Officer,” People’s Daily 

Online (Beijing, China, September 15, 2010). 27 “Ecuadoran Defense Minister Meets with Chinese Military Delegation,” People’s Daily 

Online (Beijing, China, November 14, 2010). 28 “Jefe del Estado Mayor chino está desde el martes en Venezuela,” El Universal (Caracas, Venezuela, November 18, 2010).

29 “Chinese Defense Minister Meets Surinamese Military Delegation,” Xinhua (December 2, 2012).

30 “China, Perú Pledge to Enhance Military Cooperation,” Xinhua (May 3, 2011). 31 “China, Chile Pledge Closer Military Ties,” Xinhua (June 8, 2011). 32 “Cuba, China Pledge to Enhance Bilateral Ties, Military Cooperation,” Xinhua (October 28, 2011).

33 “China, Bolivia Pledge to Strengthen Military Ties,” People’s Daily Online (December 

6, 2011).

34 “China, Cuba to Further Military Cooperation,” Xinhua (September 14, 2012). 35 “Chinese Defense Minister Meets Chilean Guest,” Xinhua (September 25, 2012). 36 “Assistant Foreign Minister Zhang Kunsheng Lectures at the 1st China-Latin America High-Level Forum on Defence,” People’s Republic of China Ministry of Foreign Affairs Official Website (November 13, 2012).
R. Evan Ellis 111

37 “Chinese Defense Minister Meets with Latin American Guests,” Xinhua (November 

20, 2012).

38 See “UN Mission’s Summary Detailed by Country,” Monthly Reports (January 2011–

December 2012, accessed January 18, 2013).

39 “China Confirms Death of All 8 Chinese Police Officers in Haiti Quake,” China View

(January 17, 2010). In the days following the earthquake, the PLA police contingent was 

temporarily augmented by rescue workers and other personnel from the PRC. “Chinese 

Rescue Team Arrives in Haiti, Eight Chinese Still Missing,” Peoples Daily Online (Beijing, 

China, January 14, 2010).

40 “Chinese Rescue Team Arrives in Haiti, Eight Chinese Still Missing,” Peoples Daily 

Online (Beijing, China). The official list of casualties associated with MINUSTAH, listing 

only four Chinese peacekeepers can be found at: MINUSTAH United Nations Stabilization Mission in Haiti. Downloaded January 12, 2011 An account of the collapse of 

the MINUSTAH headquarters can be found at “UN Headquarters in Haiti Collapsed in 

Quake,” CBS News. 41 “China Further Honors Peacekeepers Killed in Haiti Earthquake,” Peoples Daily Online

(Beijing, China, January 26, 2010).

42 See, for example, Florencia Jubany and Daniel Poon, “Recent Chinese Engagement 

in Latin America and the Caribbean: A Canadian Perspective,” FOCAL (March 2006). 43 There may be separate Air Force and Navy versions of this course. 44 The formal legal request to the Uruguayan Congress for the Naval Captain Sergio 

Dos Santos to attend the year-long course appears as Resolution 56.547, Ministerio de 

Defensa Naciónal, Ministerio de Relaciones Exteriores (Montevideo, Uruguay, April 

29, 2009).

45 “Simpósio InterNaciónal no Naval Command College do Exército Popular de Libertacão de China,” PlanoBrazil (December 18, 2010). 46 “Curso de Chino Mandarín,” Ejército de Chile official website (August 2, 2007). 47 “China dona US$1 millón a Colombia para armamentos,” ABC (Asunción, Paraguay, 

September 6, 2010).

48 “Brazil Seeks Closer Defense Relationship with China: Defense Minister,” People’s 

Daily Online (Beijing, China, September 30, 2010). 49 Robert Benson, “Chinese Navy’s Historic Pearl Harbor Visit,” Asia-Pacific Defense Forum (Fall 1997, accessed January 12, 2011). See also Christopher D. Young and Ross Rustici, “China’s Out of Area Naval Operations: Case Studies, Trajectories, Obstacles and 

Potential Solutions,” China Strategic Perspectives no. 3 (Washington, DC: National Defense 

University Press, December 2010).

50 The ships in question left the Chinese port of Qingdao in October 2009 and completed their South American port calls in December 2009. “Dos buques militares chinos 

de última generación visitan Ecuador,” Observatorio de la política China (December 12, 

2009).

51 One analysis notes that reports from past deployments suggest that issues such as 

repairing or replacing critical parts and obtaining supplies such as fresh fruits and vegetables are critical obstacles for long-range force projection by the Chinese Navy. See Young 

and Rustici, “China’s Out of Area Naval Operations.” 

52 See, for example, “Chinese, Chilean Navy Commanders Discuss Ties,” China Daily
112 The Strategic Dimension of Chinese Engagement with Latin America

(Beijing, China, November 9, 2010). See also “Hawaii to Host 10th Western Pacific Naval 

Symposium,” US Navy official website (October 29, 2006).

53 “Chinese Honor Guards Shine at Mexico’s Independence Parade,” People’s Daily Online (Beijing, China, September 19, 2010). 54 “Ejércitos de Perú y China Concluyen operación de acción humanitaria conjunta en 

Lima,” Andina (November 30, 2010). 55 “Operación Conjunta China-Perú de Rescate Medico Humanitario ‘Ángel de la 

Paz,’” Maquina de Combate (November 24, 2010). 56 “Ejércitos de Perú y China Popular culminan operación militar conjunta en salud,” 

Andina (November 30, 2010). 57 As examples of press coverage of the visit, see “Ja welcomes China medical ship,” 

Jamaica Observer (Kingston, Jamaica, October 30, 2011). See also Glen Mohammed, “Patients Praise Visiting Chinese Medical Ship,” Trinidad Express (November 10, 2011). See 

also Irene Rodriguez, “Barco hospital chino llegó para atender población puntarenense,” 

Nación (San Jose, Costa Rica, November 23, 2011). 58 “China‘s Hospital Ship Sets Sail for Caribbean States,” China Radio International. See 

also R. Evan Ellis, “Actividades Chinas en las Naciones del Caribe,” Air & Space Power Journal en Espanol (4th Semester 2011): 48–57. 59 “Chinese Navy Hospital Ship Visits Cuba, Caribbean,” Reuters (October 21, 2011). 60 Irene Rodriguez S., “Barco chino ayudará a hospital de Puntarenas a bajar listas de 

espera,” Nación (November 24, 2011). 61 Frank O. Mora, “Strategic Implications of China’s Evolving Relationship with Latin 

America,” Presentation to the Conference on China in Latin America (Washington, DC, 

November 6, 2009).

62 Interview with General Carlos Ospina-Ovalle, former Commander of the Colombian Armed Forces (Washington, DC, January 12, 2011). Personal perspective on why 

Colombia had not purchased significant military end items from the PRC.

63 “Venezuela’s Chávez to Buy Chinese K-8 Planes,” Reuters (May 11, 2008). 64 “Venezuela Air Force to Take Delivery on Chinese Jet Trainer K-8 Karakorum Next 

Year,” World Military Forum (November 28, 2009). 65 “Aviación recibe primeros seis aviones chinos de combate K-8W,” El Universal (Caracas, Venezuela, March 13, 2010).

66 “Aviación recibe primeros seis aviones chinos de combate K-8W,” El Universal (Caracas, Venezuela, March 13, 2010).

67 “En agosto llegan 12 nuevos aviones K-8,” El Universal (Caracas, Venezuela, June 30, 

2010).

68 “Venezuela compra a China 12 aviones de transporte,” El Universal (Caracas, Venezuela, November 29, 2010). See also R. Evan Ellis, “China-Latin America Military Engagement: Good Will, Good Business, and Strategic Position” (Carlisle Barracks, PA: US 

Army War College Strategic Studies Institute, August 2011).

69 “Se cayó avión militar en Barquisimeto,” El Universal (Caracas, Venezuela, July 21, 

2010).

70 The possibility of purchasing the L-15 was discussed in meetings between the Chinese and Venezuelan military leadership in October 2009.

71 “Venezuela compra a China 12 aviones de transporte,” El Universal (Caracas, Venezu-
R. Evan Ellis 113

ela, November 29, 2010).

72 “Chávez: Constituyente es para debatir Plan Socialista,” El Universal (Caracas, Venezuela, November 16, 2012). See also “China entrega a Venezuela primeros aviones Y-8,” 

El Universo (Guayaquil, Ecuador, November 15, 2012). 73 Inigo Guevara, “Venezuelan President Announces Delivery of Y-8 Medium Transports,” Janes Defence Weekly (November 12, 2012). 74 “AVIC Bags Big Deal in Venezuela,” People’s Daily Online (July 13, 2010). 75 “China Seals Aircraft Deal with Venezuela,” Ria Novost (July 13, 2010). 76 Ambassador Roger Noriega, former Deputy Assistant Secretary of State for the 

Western Hemisphere, public remarks at the American Enterprise Institute (Washington, 

DC, January 18, 2011).

77 Joanna Paraszcuk, “Iran Admits Exporting Drone Tech to Venezuela,” Jerusalem Post

(December 12, 2012).

78 Brian Ellsworth, “Venezuela Says Building Drones with Iran’s Help,” Reuters (June 

24, 2012).

79 “China vendió vehículos blindados anfibios al ejército venezolano,” La Republica

(Lima, Peru, July 5, 2012).

80 Inigo Guevara, “Venezuelan Marines Reorganize, Favoring Chinese Vehicles,” International Defense Review (January 28, 2013). 81 Oliva Kroth, “Venezuela’s Military Empowerment under President Chávez,” Pravda

(September 18, 2012).

82 “Consideran comprar radares de baja cota,” El Universal (Caracas, Venezuela, June 6, 

2009).

83 Maria Daniela Espanoza, “FAN utilizará radar de origen chino en ejercicio con Brasil,” El Universal (Caracas, Venezuela, August 21, 2008). 84 Noriega, public remarks at the American Enterprise Institute. 85 “Instalarán 10 radares chinos para mayor control del espacio aéreo,” El Universal (Caracas, Venezuela, December 29, 2010).

86 The JYL-1 radars purchased by Venezuela from the Chinese reportedly have an effective detection range of 240 nautical miles. For more information about the transaction, 

see “Consideran comprar radares de baja cota,” El Universal (Caracas, Venezuela, June 6, 

2009).

87 Some confirmation of this activity appears in the resumes of Huawei personnel who 

mention having worked on the modernization of the DICOFAN network. See, for example, Monica Suinaga, Huawei Design Engineer, online resume.

88 “Huawei establece alianzas con el sector académico venezolano,” Caracas Digital (January 24, 2011).

89 “Colombia pide la captura de un diputado venezolano por ‘Farcpolitica,’” El Tiempo (December 5, 2009). See also “Fiscalía colombiana ordena detención de diputado 

venezolano Figueroa,” El Comercio (Quito, Ecuador, December 6, 2009). 90 “Ecuador recibirá radares chinos para su frontera con Colombia,” El Universal (Caracas, Venezuela, September 29, 2009).

91 “Ecuador instalará cuatro radares en la frontera con Colombia este año,” El Universal

(Caracas, Venezuela, August 16, 2010).

92 “Hoy se cumplen 3 años de la compra de radares a China,” El Universo (Guayaquil, 
114 The Strategic Dimension of Chinese Engagement with Latin America

Ecuador, June 8, 2012).

93 “Fiscalia investiga FAE por contrato de radares,” El Universo (Guayaquil, Ecuador, 

May 21, 2012).

94 “Ecuador negocia con China compra de aviones logísticos Javier Fernandez,” El Universo (Guayaquil, Ecuador, July 30, 2009). See also “Ecuador comprará aviones a China, 

para reemplazar gran parte de su flota actual,” Aviación Argentina-over-blog (July 31, 2009). 95 “China Duplicará Colaboración Militar Copn Ecuador, Según Fuerzas Armadas Del 

Vecino Pais,” El Tiempo (Bogotá, Colombia, February 15, 2010). 96 “Ecuador comprará aviones de transporte militar chinos,” El Universo (Guayaquil, 

Ecuador, August 16, 2010).

97 “Proyectos de la Fuerza Aérea Ecuatoriana,” Saorbats, accessed January 13, 2011. See 

also “Ecuador comprará aviones de transporte militar chinos,” El Universo (Guayaquil, 

Ecuador, August 16, 2010).

98 “FAE desiste de comprar aeronaves a China por un ‘desacuerdo técnico,’” El Universo

(Guayaquil, Ecuador, July 4, 2011).

99 “China Duplicará Colaboración Militar Copn Ecuador, Según Fuerzas Armadas Del 

Vecino País,” El Tiempo (Bogotá, Colombia, February 15, 2010). 100 “Missile Affair in Bolivia Tarnishes Reputations, Yields Few Answers,” Miami Herald

(Miami, Florida, March 13, 2006).

101 “Bolivia aclara que 10.000 fusiles fueron donados por China y no por Venezuela,” 

Terra (June 26, 2008). 102 “Bolivia comprará aviones chinos para lucha antidroga,” El Universo (Guayaquil, Ecuador, October 2, 2009).

103 “Bolivia to Receive Combat Aircraft from China,” Asia One (January 19, 2011). 104 “Avión K8 que ensambla Bolivia tiene antecedentes de falla en Venezuela,” Los Tiempos (Cochabamba, Bolivia, June 24, 2011). 105 “Bolivia estrena aviones chinos K-8 en aniversario de FFAA,” Xinhua (August 8, 

2011). See also “Aviones K8 serán entregados para entrenamiento de pilotos de la FAB,” 

El Diario (July 22, 2011). See also “Gobierno ratifica compra de naves chinas y rusas,” 

Los Tiempos (Cochabamba, Bolivia, January 15, 2010). See also “Bolivia to receive combat 

aircraft from China,” Asia One (January 19, 2011). 106 “Bolivia to Receive Combat Aircraft from China,” Asia One (January 19, 2011). 107 “El gobierno decide potenciar la fuerza aérea,” La Razón (La Paz. Bolivia, February 

19, 2007). See also “La FAB se fortalece con un avión de carga,” La Razón (La Paz, Bolivia, 

August 2, 2007).

108 “En 2007, Bolivia sextuplico su deuda,” El Deber (Santa Cruz, Bolivia, January 31, 

2008).

109 “Cámara de Senadores sanciona Ley para adquisición de helicópteros multipropósito de China,” Los Tiempos (Cochabamba, Bolivia, March 9, 2012). 110 “Helicópteros chinos no alcanzarían 4 mil msnm,” Los Tiempos (Cochabamba, Bolivia, 

February 29, 2012).

111 “China dono equipos a las fuerzas armadas,” Los Tiempos (Cochabamba, Bolivia, December 16, 2006).

112 “China regaló 43 vehículos a las fuerzas armadas,” El Deber (Santa Cruz, Bolivia, 

September 11, 2007).
R. Evan Ellis 115

113 “China donó a las FF.AA. de Bolivia US$2,6 millones,” América Economía (March 31, 

2010).

114 “Bolivia y China fortalecen cooperación militar,” Los Tiempos (Cochabamba, Bolivia, 

August 18, 2010).

115 “Revivir el Plan Azul de carreteras,” Los Tiempos (Cochabamba, Bolivia, March 9, 

2012). See also “China dona equipos de ingeniería a las Fuerzas Armadas de Bolivia,” 

Tecnologia Militar (June 1, 2012). 116 “Bolivia y China suscribieron acuerdo de cooperación militar,” UPI Español (May 11, 

2012).

117 “Negocia la Argentina comprar helicópteros militares a China,” La Nación (Buenos 

Aires, Argentina, May 17, 2007).

118 Guido Bratslavsky, “Licitación de radares: Ya hay trece empresas interesadas,” Clarín

(Buenos Aires, Argentina, January 29, 2007).

119 “Negocia la Argentina comprar helicópteros militares a China,” La Nación (Buenos 

Aires, Argentina, May 17, 2007).

120 “Puricelli destaco ‘asociación estratégica’ con china en materia de defensa,” TELAM

(July 4, 2012).

121 “Norinco Wmz-551b1 Ea,” Socyberty (October 3, 2010). 122 Christian Vilada, “Argentina evalúa la adquisición de blindados chinos,” Saorbats (August 27, 2008).

123 Jorge Elias, “Opinión: Llegaron los VCTP WMZ-551B1 chinos,” Desarrollo y Defensa

(September 10, 2010).

124 “Novedad en Parada Militar fue la presentación de cinco nuevos tanques chinos 

MBT 2000,” Agencia Peruana de Noticias (December 8, 2009). See also “Tanques chinos: 

El Ejército está de acuerdo con la compra,” Perú21 (Lima, Peru, December 10, 2009). 125 See also Jose Santilan Arruz, “Ministro de Defensa negó que Estados Unidos haya 

tenido alguna influencia o injerencia en la postergación de adquisición,” El Comercio

(Lima, Peru, April 15, 2010).

126 “Gobierno suspende indefinidamente compra del tanque chino MBT-2000,” La Republica (Lima, Peru, April 7, 2010). 127 “El Ejecutivo busca postergar la compra de tanques chinos,” Gestión (Lima, Peru, 

April 6, 2010).

128 Kelly Hearn, “China-Perú military ties growing stronger,” Washington Times (Washington, DC, May 27, 2012).

129 “Perú y China firman un convenio de cooperación por 800 mil dólares,” El Comercio

(Lima, Peru, November 11, 2007).

130 Carlos Ospina-Ovalle, former Commander-in-Chief of the Colombian Armed 

Forces, interview (Washington, DC, December 1, 2009).

131 For photos of these cars in the colors of the municipal police of Montevideo, see 

“Geely Policía de Montevideo,” Flickr (January 27, 2011).

132 “En el Perú ya se venden autos de la marca Geely,” El Comercio (Lima, Peru, August 

1, 2007).

133 “China dona US$1 millón a Colombia para armamentos,” ABC (Asunción, Paraguay, 

September 6, 2010).

134 R. Evan Ellis, “Las relaciones China-Colombia en el contexto de la relación es-
116 The Strategic Dimension of Chinese Engagement with Latin America

tratégica entre Colombia y los Estados Unidos,” In Benjamin Creutzfelt, ed., China en 

América Latina (Bogotá, Colombia: Universidad Externado, 2012), 295–325. 135 “Colombia and China Sign a Military Cooperation Agreement,” Colombia Air Force 

official website (June 26, 2012).

136 “China Sends $3.5M in Military Equipment to Jamaica,” Today Online (January 15, 

2011).

137 See R. Evan Ellis, “Actividades Chinas en las Naciones del Caribe,” Air & Space Power Journal en Espanol (4th Semester 2011): 48–57. For context on the criticism of the 

Jamaica government and the JDF over the Tivoli Gardens incident, see Marc Wignal, 

“Something Went Horribly Wrong in Tivoli Gardens,” Jamaica Observer (Kingston, Jamaica, May 30, 2011).

138 “GDF Officer Cadet Heads to China for Specialist Pilot Training,” Guyana News (August 29, 2012).

139 “Remarks by H.E. Ambassador Yuan Nansheng at the Hand-over Ceremony of Military Materials Granted by the People’s Republic of China to the Republic of Suriname,” 

Ministry of Foreign Affairs of the People’s Republic of China, news release (October 6, 

2009).

140 See, for example, R. Evan Ellis, “Suriname and the Chinese: Timber, Migration, and 

the Less-Told Stories of Globalization,” SAIS Review, vol. 32, no. 2 (Summer-Fall 2012): 

85–97.

141 “Costa Rica pidió a China Continental entrenamiento policial,” El Nuevo Diario (Managua, Nicaragua, November 3, 2010).

142 “Brazil Seeks Closer Defense Relationship with China: Defense Minister,” People’s 

Daily Online (Beijing, China, September 30, 2010). 143 “Paraguay Soldiers Using Chinese M4 (CQ 5.56) Carbines,” MilitaryPhotos.Net 

(February 9, 2008).

144 Jia Wen, “Remembering Chinese Peacekeepers in Haiti,” Global Times (January 19, 

2010).

145 Manuel Cereijo, “Inside Bejucal Base in Cuba: A Real Threat,” The Americano (August 

27, 2010). Cereijo’s allegations concerning Bejucal, however, have been questioned by 

Cuba scholar William Ratliff, among others, who noted that the radar domes in the photo accompanying Cereijo’s article are not located at Bejucal, as represented, but rather, 

at the US-operated Menwith Hill facility in the United Kingdom. See “Cereijo, Bejucal, 

China and Cuba’s Adversary Foreign Intelligence (Bill Ratliff,US),” World Association of 

International Studies (April 3, 2006).

146 “Chinese Signals Intelligence and Cyberwarfare in Cuba,” AFIO Weekly Intelligence 

Notes No. 23–06 (June 12, 2006). 147 “China Begins 26th Antarctica Season with a Team of 251 Scientists,” Mercopress (October 14, 2009).

148 Young and Rustici, “China’s Out of Area Naval Operations.” 149 “China Bolsters Antarctica Posts,” BBC News (November 6, 2007). 150 Andrew Darby, “China Flags Its Antarctic Intent,” The Sydney Morning Herald. 151 Young and Rustici, “China’s Out of Area Naval Operations.” 152 J. Michael Waller, “China’s Beachhead at Panama Canal,” BNet (August 16, 1999).
117

Chapter 6

China–Latin America 

Organized Crime Ties1

Introduction

In June 2010, Brazilian politics were rocked by the sacking of Secretary of Justice 

Romeu Tuma Junior for allegedly being an agent of the Chinese mafia.2 Three 

years earlier, in July 2007, then-head of the Colombian national police General 

Oscar Naranjo made the striking proclamation that “the arrival of the Chinese 

and Russian mafias in Mexico and all of the countries in the Americas is more 

than just speculation.”3 Although, to date, the expansion of criminal ties between 

the PRC and Latin America has lagged behind the exponential growth of trade 

and investment between the two regions, the two incidents mentioned above 

publicly highlight that criminal ties between the two regions are becoming an 

increasingly problematic byproduct of expanding China–Latin America interactions, with troubling implications for both regions.

Domains of Expanding Transpacific Criminal Ties

Although data to quantify the character and extent of such ties is lacking, the 

public evidence regarding such ties suggests that criminal activity spanning the 

two regions is principally concentrated in four current domains and two potentially emerging areas. The four groupings of current criminal activity between 

China and Latin America are: (1) extortion of Chinese communities in Latin 

America by groups with ties to China; (2) trafficking in persons from China 

through Latin America to ultimately smuggle Chinese into the US or Canada; 

(3) trafficking in narcotics and precursor chemicals; and (4) trafficking in contraband goods. The two potentially emerging areas are: (1) arms trafficking and 

(2) money laundering.

It is important to note that this analysis neither implicates the Chinese 

government in such ties, nor absolves it from such connections, although a consideration of incentives suggests that it is highly unlikely that the Chinese government 

would be involved in any systematic fashion. This chapter also does not suggest that 

the criminal ties spanning both regions reflect a coordinated group of purpose-driven criminal organizations. Rather, it calls attention to a problem that is an unfortunate but natural artifact of the expansion of human and commercial contacts between 

Latin America and Asia for which Latin America may be frighteningly unprepared.
118 The Strategic Dimension of Chinese Engagement with Latin America

The “Chinese Mafia” in Chinese Communities of Latin America

As in other parts of the world, organized criminal groups with linkages to mainland China, Hong Kong, Taiwan, and Macau have long operated within the relatively closed ethnic Chinese communities of Latin America. Some, but not all 

of these groups, referred to as the “triads,” had their origins as “secret societies” 

organizing Chinese Diaspora communities, with respect to both their new countries and to political activities in mainland China and surrounding areas, but that, 

over time, evolved into criminal groups.

Because ethnic Chinese communities abroad have historically been 

reluctant to report problems among their own members to non-Chinese host 

nation authorities, the activities of Chinese “mafias” in Latin America has been, 

to date, almost invisible. Nonetheless, in recent years, stories have increasingly begun to emerge regarding extortion and other criminal activity by such 

groups operating within Chinese communities in the major urban centers of 

Latin America. In Argentina, for example, where Chinese mafias with ties to 

the Fujian province have had a recognized presence since the 1990s, there have 

been increasing news accounts regarding extortion-related violence against Chinese shopkeepers. 4 Indeed, accounts of such activities and related crimes against 

members of the Chinese business community and their stores have appeared in 

the press not only in the greater metropolitan area of Buenos Aires, but also in 

other parts of the country, including Mar del Plata,5 Bahia Blanca, 6 and Lomas de 

Zamora.7 Similar incidents have also been reported in the interior of Argentina, 

including in the modest-sized provincial capital of Mendoza, where in one 48 

hour period in 2011, authorities reported 30 separate extortion threats.8

In Lima, Peru, and the urban area surrounding it, host to one of Latin 

America’s largest Chinese communities,9 similar accounts have emerged of “Chinese mafias” extorting ethnic Chinese owners of hotels, saunas, restaurants, discos, and other commercial establishments.10 Examples include an attack against a 

Peruvian Chinese restaurant in the neighborhood of Callao, involving a Molotov 

cocktail (presumably for not paying “protection money”),11 and reports of shopkeepers being extorted by members of the group “Red Dragon” from prisons in 

or near the capitol. 12 Indeed, in contrast to the behavior of the Chinese mafia in 

other countries of the region, such groups in Peru have gone beyond extorting 

members of their own community to threaten the mainstream business community. In a high-profile case in August 2012, for example, Peruvian business executive Yeni Mendoza of the business group Gamarra was assassinated over what 

was believed to have been the failure to pay an extortion demand to the group 

Dragon Rojo.13

In Venezuela, authorities have detected Chinese mafias operating in the 

country for at least the past three years.14 Similar accusations have been made con-
R. Evan Ellis 119

cerning the presence of the Chinese mafia in Guayaquil and other parts of Ecuador 

since at least 2009.15

In Panama, where the Chinese population is arguably the largest in the 

region in terms of percentage of the population, comments from Panamanian 

government officials have appeared in the press referring to Chinese bands active in the country involved in the extortion of members of the local Chinese 

community and other crimes.16 Publicly, the killing of five Chinese youth in the 

neighborhood of Chorea received national attention not only for the brutality of 

the killing, but for the perceived lack of a substantial response by the national 

police.17 Members of the public security forces, speaking off the record for this 

investigation, acknowledge that the Chinese mafia is very active in the country.

In the Caribbean basin, a number of violent assaults against Chinese in 

2012 have highlighted the presence of Chinese mafia groups there as well, including a widely publicized double homicide in Trinidad in July 2012.18 The Caribbean’s Implementation Agency for Crime and Security (IMPACS) has reportedly been following the activities of Chinese criminal gangs in the region since at 

least 2006.19 In Paramaribo, Suriname, suspicious incidents in recent years have 

included a 14-year-old Chinese boy who was found chopped to pieces in front of 

a popular tourist hotel, and, separately, the double beheading of a Chinese father 

and son.

Sometimes it is difficult to distinguish the Chinese mafia from the powerful but legitimate support structures of the local Chinese community. It is said 

that such mafias provide capital to help Chinese entrepreneurs establish their 

businesses, a wholesale network for the goods sold in those stores, “organization of the market” assuring individual shopkeepers individual segments of the 

neighborhood, and of course, protection services. On the other hand, in the case 

of Suriname, the official “club” Kong Njie Tong Sang and others representing the 

established Chinese community, is instrumental in providing revolving credit to 

the younger Chinese immigrants, while the hundreds of Chinese shops in the 

capital Paramaribo depend on a handful of Chinese wholesalers from the older 

generation Chinese Surinamese community. Yet such structures do not make the 

established Chinese-Surinamese community a criminal “mafia.”

The activities of Chinese mafia groups create an inherent criminal link 

between the two regions, insofar as threats against family in China are often used 

as one tool for extorting Chinese in Latin America.20 A particularly worrisome 

example of such ties is the presence of the Chinese mafia in Tapachula, in the 

state of Chiapas, which serves as a point of entry into Mexico for Chinese and 

others crossing at Frontera Corozal following trafficking routes up the Atlantic 

coast of Mexico, currently controlled by Los Zetas.

Although such activities and ties are troubling in and of themselves, in 

the context of expanding flows of people, products, and money between China 
120 The Strategic Dimension of Chinese Engagement with Latin America

and Latin America, the risk is that these mafias, with their connections to Asia, 

will opportunistically expand into other types of activities associated with those 

flows. In Peru for example, the group “Red Dragon,” whose activities were once 

principally confined to extorting local Chinese restaurant owners and shopkeepers, has over time diversified to involvement in global human smuggling networks, and, most recently, into the trafficking of cocaine and synthetic drugs 

from Asia. 21

Trafficking in Persons

Currently, smuggling of persons from Asia through Latin America to Canada and 

the United States is the largest visible transnational criminal linkage between the 

two regions. The presence of illegal Chinese immigration into Latin America has 

been recognized as a significant problem by multiple organizations, including the 

UN Office against Drugs and Crimes.22 Such trafficking is highly lucrative, generating $70,000 or more per person and representing a $750 million per year 

business for the Chinese mafias alone, according to one estimate.23

Many of the routes used to move Chinese immigrants go through Europe, then to different parts of South America. In the special case of Suriname, 

many of the Chinese immigrants come through the Netherlands, although Dutch 

authorities have recently taken steps to stop these flows.

Many of the Chinese immigrants moving through the region begin their 

trips through South America in the Pacific coast nations of Colombia, Ecuador, 

or Peru,24 with patterns in such flows being strongly affected by changes in the 

patterns and policies regarding enforcement in these countries. In 2007, for example when Colombia ceased requiring visas for Chinese nationals to enter the 

country, the nation’s security service, the Departamento Administrativo de Seguridad

(DAS), reported an increase in Chinese nationals transiting through the country, 

ultimately leading the government to reimpose the visa requirement.25

A similar dynamic occurred in neighboring Ecuador the following year, 

when in February 2008 that country dropped its own requirements for a visa 

for Chinese nationals entering the country, prompting a large increase to almost 

6,000 Chinese entering the country through official immigration channels that 

year, and the appearance in the media of trafficking of Chinese as an issue.26

Associated with this phenomenon, there was a new wave of detentions as those 

Chinese were moved by Chinese mafia groups such as Red Dragon overland 

through Colombia, then northward toward the United States.

Like Colombia and Ecuador, Peru has also been beset by problems 

involving Chinese mafias such as Red Dragon’s illegally moving immigrants 

through the country, often across its border with Ecuador,27 and acquiring documents for them. In at least one case, government employees of the national document registry (RENIEC) were implicated in providing false identity documents 
R. Evan Ellis 121

as part of this process,28 including one case in which 22 members of RENIEC 

were accused of issuing false birth certificates.29

Beyond the Pacific coast countries which often serve as points of entry, 

a portion of the Chinese trafficked into the region enter through Brazil, where a 

visa is not required for Chinese citizens. One network, detailed in a Uruguayan 

media exposé, brought Chinese to Brazil by aircraft, then smuggled them overland and across river borders into Uruguay30 to Argentina.31 In other cases, the 

Chinese travel overland through Bolivia and Paraguay, 32 ultimately remaining in 

countries such as Argentina,33 or later moving on toward the United States. In 

Bolivia in particular, a number of detentions of Chinese traveling through the 

country without proper documents have been reported in recent years.34

As with Peru and elsewhere, such activities have also come to involve 

government workers in the process of obtaining false identity documents. In 

2006, for example, 16 current and 12 former Bolivian Congressmen were implicated in a scandal involving the granting of false visas to Chinese immigrants.35

Although a portion of the Chinese who enter the region through such 

illegal trafficking networks remain in South America, the majority continue journeying toward the United States and Canada, often traveling overland through 

Central America and Mexico.36 Anecdotal evidence of such flows of Chinese 

through Central America include an incident in April 2011 in which the head 

of the Panamanian immigration directorate was implicated in the generation of 

false immigration documents for Chinese passing through the country.37 An expansion in the flow of Chinese immigrants through Costa Rica has also been 

detected,38 with an increase in the corresponding number of detentions.39

Anecdotal public evidence also suggests a correlation between Chinese 

entering the Pacific coast of Latin America and illegal flows of Chinese migrants 

through Central America. Between January 2006 and 2007 alone, detentions 

of Chinese illegally passing through in Costa Rica, Panama, and Colombia registered a 2,500 percent increase, after the previously noted policy change in 

which the Colombian government temporarily suspended the visa requirement 

for Chinese nationals.40

With respect to flows of migrants through Mexico itself, authorities 

distinguish between two separate routes. First, as noted in the previous section, 

Chinese crossing through the southern border of Mexico enter principally at 

Frontera Corozal, in the state of Chiapas, into the Mexican city of Tapachula, 

where there is a sizeable ethnic Chinese community. They then follow a route 

that begins with a journey by train to the Atlantic coast, then following the coast 

north to the United States. Second, Chinese migrants enter directly from Asia, 

passing through ports on the Mexican Pacific coast, including Puerto Vallarta in 

Jalisco, Manzanillo in Colima, and Coyacan, in Mazatlan. Still others come in by 

air directly to Mexico City, where the activity of Chinese trafficking networks 
122 The Strategic Dimension of Chinese Engagement with Latin America

has been publicly reported by the Attorney General’s office.

Part of the worrisome dynamic created by such flows of Chinese immigrants is the opportunity for interaction between the mafias linked to China, 

such as Red Dragon, which ostensibly manage the journeys of these immigrants, 

and the Latin America–based criminal groups that control the territory through 

which they pass, such as Mexico-based transnational criminal organizations.41

Chinese immigrants entering Mexico through the Pacific Coast, as noted previously, must pass through areas in which illicit activities such as human trafficking 

are controlled and taxed by the Juarez and Gulf cartels, while those following the 

route from Central America up the Gulf coast follow routes currently controlled 

by los Zetas. Among other risks, the interactions associated with the implied 

collaboration between Chinese groups and the Mexican cartels are its potential to diversify into other forms of collaboration, as well as competition.

Although the Central America–Mexico route is a major pathway for 

Chinese bound for the United States, it is also important to mention other 

routes, such as through Venezuela and the Caribbean.42 The use of Venezuela reflects both the sizeable Chinese community there, and the increasing corruption of authorities at all levels.43 On multiple occasions, authorities detected and 

acted against Chinese trafficking networks operating out of Puerto Ordaz, in 

the northeast of Venezuela, with one major case reported in 200744 and another 

reported in December 2011, in which the Venezuelan intelligence service SEBIN 

found the government equipment for the production of documents in the hands 

of the group.45

In Trinidad and other parts of the Caribbean, authorities have registered 

an increase in trafficking of Chinese since 2006.46 Analysts in Trinidad have expressed concern that the officially authorized entry of Chinese workers for the 

growing number of construction projects being done by Chinese firms in the 

region may also facilitate illegal human trafficking flows, with Chinese overstaying their work permits and being smuggled by the Chinese triad-affiliated 

“snakehead gangs” into the United States.47 In Suriname, similar patterns are 

suspected of Chinese entering the country on work permits, facilitated by the 

government’s revolving construction agreement with China Dalian, then overstaying their visas. In Guyana, in one case, undocumented Chinese workers were 

exposed in the nation’s gold mining sector.48

Trafficking in Narcotics and Precursor Chemicals

Beyond human trafficking and extortion in Latin American Chinese communities, troubling new trans-Pacific ties appear to be forming in the domain of narcotrafficking. Mexican cartels, such as Sinaloa and Tijuana, source many of their 

precursor chemicals from Asia, particularly those for methamphetamines, such 

as ephedrine and pseudoephedrine.49 The Mexican cartel “Jalisco Nueva Gener-
R. Evan Ellis 123

ation,” for example, imports both cocaine from Colombia and ephedrine from 

China.50 Multiple seizures of such chemicals coming from China and India and 

entering Mexican commercial ports such as Lazaro Cardenas and Michoacán, 

have been made in recent years by Mexican authorities.51 In September 2012, 

for example, Mexican authorities intercepted 32 tons of precursor chemicals in 

the port of Manzanillo, sent from China to the state of Colima in the Mexican 

Pacific.52

Although publicly available evidence does not make it clear whether 

Chinese organized crime groups are involved or whether the Mexican cartels are 

simply buying precursor chemicals from Chinese companies with lax controls,53

anecdotal evidence such as the case of Zhenli Ye Gon case54 suggests that Chinese 

organized crime is likely involved.55

Shipments of precursor chemicals from China also appear to be sent 

increasingly to Guatemala for the production of synthetic drugs in clandestine 

laboratories there. Press reports of interceptions of large quantities of such 

chemicals bound for Guatemala appear regularly in the press. In August 2012, 

for example, Guatemalan authorities reported intercepting a shipment of 80 

barrels of cocaine paste in the port of Quetzal in a container sent from Taiwan,56

then just three days later, 40 barrels of precursor chemicals were discovered in 

the same port, also coming from Taiwan, with the destination believed to be 

drug labs operating in remote regions of the country.57 A major interception of 

720 barrels of precursors going from China to Guatemala had previously been 

reported in April of the same year.58 In at least one major case, precursor chemicals imported from China into the Mexican port of Michoacán had an ultimate 

destination of the Port of Corinto, in Nicaragua, suggesting that drug labs using 

Chinese precursors were beginning to operate in that nation as well.59

Precursor chemicals from China have also been intercepted coming 

into countries such as Peru, where both the Sinaloa and Tijuana cartels are believed to be operating.60 Moreover, the Peruvian connection suggests the possible 

emergence of a global narcotics supply chain, with precursor chemicals such as 

kerosene moving to “source zone” countries such as Peru, where the drugs are 

made and ultimately transshipped by Mexico-based cartels to the United States 

and elsewhere.

In addition to precursor chemicals, criminal groups are also smuggling 

finished drugs between the two regions, with the growing potential for collaboration and competition between Chinese and Mexican criminal organizations. 

Recent cases suggest that the Sinaloa cartel, for example, is attempting to enter 

the Asian market.61 The number of Colombians imprisoned in the PRC for attempting to smuggle drugs into China reportedly increased by a factor of five 

from 2011 to 2012.62 According to authorities, the network reportedly involved 

collaboration between Chinese mafias and Mexican drug gangs with persons to 
124 The Strategic Dimension of Chinese Engagement with Latin America

carry the drugs recruited in rural Colombia, flown to Peru or directly to Brazil 

where they were loaded with drugs, then flown to Dubai or Qatar, or directly to 

Hong Kong or Guangzhou.63 As with human trafficking, the routes used appear 

to vary, and change over time in response to enforcement patterns. A high profile 

case during 2011 involved cocaine smuggled from Mexico to Hong Kong.64 In 

another case cocaine was reportedly being sent from Colombia to Panama and 

Costa Rica, then onto the PRC, among other destinations.65 Documentation of 

at least one case involving drug shipments from Colombia to China indicates that 

Chinese organized crime groups were the purchasers on the other end, while the 

group on the Latin American side handled the logistics and realized the profit. 

A kilogram of cocaine arriving in China sold for an estimated $55,000, almost 

triple what the same product would sell for in the United States.66 In one case, a 

major shipment of drugs was intercepted coming into a port in Hong Kong from 

Ecuador.67 Cocaine has been intercepted following a southern route from Chile 

to Asia,68 and some interactions have been reported between Mexican drug cartels and Asian heroin-trafficking groups.69

Trafficking in Contraband Goods

In addition to people and narcotics, the flow of illicit merchandise from China to Latin America, including pirated software, music CDs, and brand name 

clothes,70 presents an opportunity for collaboration between organized crime 

in the sending and receiving countries, particularly where Chinese merchants in 

Latin American are vendors of those goods or where the territory in question is 

dominated by Latin American criminal organizations such as Mexican cartels, or 

even street gangs. Chinese groups such as the Flying Dragons and Tai Chen, for 

example, have been identified as importers of contraband goods into the tri-border area.71 Chinese gangs in Venezuela reportedly rob merchandise and resell it 

to Chinese merchants in their protection network.72 Mexican groups such as Los 

Zetas appear to take a cut from groups distributing pirated Chinese software. Beyond just distribution, Mexican authorities interviewed for this study indicated 

that there are indeed emerging ties between the cartels and Chinese organized 

crime in the importation of contraband goods, including the port of Veracruz, 

previously controlled by Los Zetas, as well as various Pacific Coast ports. As of 

the writing of this chapter, most of the retail sales of Chinese contraband goods, 

such as the market of Tepito in Mexico City, were still being run by Mexicans, 

although Mexican authorities indicated that Chinese merchants and associated 

criminal organizations have an important role “behind the scenes.”

Interaction involving the flow of illegal commercial goods is not, however, limited to the retail sector. In Michoacán, the La Familia cartel was identified as organizing and taxing the illegal extraction of ore from mines in the 

region and its sale to China.73 Chinese criminal groups are similarly reported 
R. Evan Ellis 125

to be engaged in illegal mining in the remote province of Madre de Dios in 

southeastern Peru.74 As the volume of the contraband flow increases between the 

regions as part of the expansion of all trade between the regions, the prospects 

seem high for organized crime on both sides to more actively seek to capture this 

revenue stream.

Arms Trafficking

Although much attention is given to flows of firearms from the US into Mexico, the PRC, through the black market, is one of the principal providers of 

military-grade munitions to the region.75 A particular problem is Chinese arms 

smuggled into Mexico, often through the US.76 In 2008, for example, the commander of the 8th Military Zone of Mexico, Luis Villegas, claimed that Chinese 

arms were being smuggled across the US border into Tamaulipas, along with US 

and Russian arms.77 Chinese-manufactured grenades and other military hardware have been seized in Puebla, and elsewhere in Mexico,78 although it is not 

clear that the Mexican cartels are purchasing directly from Chinese criminal 

groups or Chinese arms companies.

Reports suggest that such arms enter through many of the same Pacific 

Coast ports in which ethnic Chinese and contraband goods are smuggled into 

the country, including the port of Manzanillo (by coincidence, controlled by the 

Hong Kong-based logistics company Hutchison Whampoa), and are smuggled 

into the country in containers of Chinese merchandise.79

Although there is little evidence that the Chinese government is knowingly involved in the trade, the degree to which Chinese arms companies such 

as the Northern Industries Corporation (NORINCO) ensure that their weapons 

are not sold or diverted into the black market is not clear. Recognizing such 

concerns, the Chinese government promulgated Law on Control of Guns in 

July 1996, issued regulations on the Administration of Arms Export in October 

1997, and started amending the regulations from October 2002, allowing sales 

only to licensed buyers.80

In arms trafficking, as noted in a previous chapter, there are also troubling “gray areas,” as highlighted in a recent investigation by the Colombia prosecutor’s office implicating a Venezuelan government official for the purchase of 

Chinese weapons by the FARC.81

Money Laundering

Finally, as banking and commercial ties expand between China and Latin America and as options for converting Chinese currency into dollars or Latin American 

currencies increase, criminal groups on all sides may increasingly use trans-Pacific financial flows to hide income and protect illicitly gained wealth. There is 

evidence that such activities have already begun to occur, taking advantage of 
126 The Strategic Dimension of Chinese Engagement with Latin America

the difficulty of Latin American investigators in following or scrutinizing transactions in Asia. In March 2010, for example, the Mexican Federal Police made 

public a case in which the Colombian Valle de Cauca cartels, in their dealings 

with the Mexican group La Familia, had sent part of their earnings to the PRC.82

Chinese-owned gambling operations in Latin America also present significant opportunities for money laundering, given the large cash flows involved 

with such establishments, just as the Russian mafias operating in Panama and 

Uruguay reportedly use casinos there to launder money.83 In a similar vein, as 

with all major gambling-oriented commercial establishments, new Chinese gambling facilities such as the $3.5 billion Baha Mar resort currently being built in 

the Bahamas could play such a role.

Finally, although there are currently few indications that flows of money by Chinese investors into the British Virgin Islands and the Cayman Islands play a major 

role in money laundering by Chinese criminal groups,84 evidence suggests that 

a variety of Chinese entities already use these destinations for tax shelter purposes, implying that it is reasonable to expect that Chinese criminal entities will 

increasingly use them to hide their earnings as well.

Strategic Implications

Latin American law enforcement is woefully unprepared to meet the challenge 

of increasing criminal ties between the two regions. In particular, police forces 

already overwhelmed by a lack of resources, competing demands, corruption, 

and low levels of trust from the societies in which they operate, have little ability 

to penetrate Chinese communities where the new criminal activities are taking 

place, including basic activities such as gathering evidence and obtaining witnesses. 85 Authorities not only lack ethnically Chinese agents, but also lack reach back 

to technical contacts in Asia who can provide background information regarding 

the people and gangs that they are investigating, as well as basic language to even 

interrogate suspects and witnesses in the communities in which the crimes they 

are investigating occur. 86

In some cases, the Chinese or Taiwanese embassies have provided assistance in operations involving Chinese communities, as was the case in Ciudad 

Guyana in December 2011, where the Chinese embassy helped local authorities 

to analyze documents, computer records, and other assets seized.87 During a 

police investigation into the Chinese mafia in Mar del Plata Argentina in December 2011, for example, specialists had to be brought in from Buenos Aires, 

because the locals in the area where the crime was committed were from Fujian 

and didn’t speak Mandarin Chinese, let alone Spanish.88 Nevertheless, the anecdotal stories of technical assistance from Taiwan or the PRC only underscore 

the degree to which Latin American security forces lack linguistic, human, and 

technical capability to follow the trail of criminality into Chinese communities, 
R. Evan Ellis 127

or the contacts to follow it back to Asia itself.

A compounding problem in managing such criminal activities throughout the region is that the police have historically not made significant effort to 

penetrate the Chinese communities in their jurisdiction, all too often allowing 

what happens in the Chinese barrios to be the business of the Chinese communities. A senior officer from the Trinidad & Tobago Criminal Investigations Unit 

referred to the “culture of the Chinese...to ‘keep things to themselves.’”89 In 

some cases, including one case in Peru covered in the media, authorities publicly 

deny that Chinese gangs even exist.90

Although the existence of criminal ties with the PRC is not one of the 

major problems currently facing Latin American governments, it is one that is 

likely to become greater with the expanding commerce and investment between 

the two regions. Based on historical precedents to date, activities by Chinese 

triads and tongs is likely to grow among Chinese communities in major Latin 

American cities, diversify into other activities, and forge new linkages with other 

criminal organizations, as happened with the Red Dragon organization in Peru, 

which evolved from extortion to human trafficking to narcotics and other activities.91

Human trafficking flows are likely to expand with the growing number 

of Chinese workers, including the new influx of loan-backed Chinese construction projects in the Caribbean. Purchases of precursor chemicals from China 

and India by Mexican drug cartels is likely to expand into other forms of collaboration, as well as competition for “turf ” in overlapping business areas such as 

Pacific maritime logistics. Mafias on both sides of the pacific are likely to become 

increasingly involved in taxing, and perhaps controlling, the growing and highly 

lucrative contraband trade. New trans-Pacific banking ties, increasing currency 

convertibility, and Chinese-owned casinos in Latin America will present new, 

and difficult to monitor, options for both Latin American and Chinese criminal 

organizations to launder money and protect assets.

Such concerns apply across a range of scenarios for the future of China–Latin American relations. If the Chinese economy slows, for example, floating urban populations in coastal urban areas are likely to expand the pool of 

US-bound migrants for human trafficking organizations to move through Latin 

America. If Chinese economic growth remains strong, flows of people, container 

traffic, and financial transactions will proliferate the number of opportunities for 

organized crime on both sides to move merchandise.

Beyond Latin America, expanding China–Latin America criminal ties 

impact the US in a myriad of ways. First, the majority of ethnic Chinese being smuggled through Latin America and a good portion of the synthetic drugs 

produced from precursor chemicals originating in the PRC are destined for the 

US. Second, expanding opportunities for money laundering through involving 
128 The Strategic Dimension of Chinese Engagement with Latin America

Chinese banks and companies benefit Latin America–based transnational criminal organizations (TCOs), such as the Mexican cartels and Colombian criminal 

bands (BACRIM), that the United States is directly engaged in combating. Moreover, an increase in the power of Latin America–based TCOs, or alternatively, 

an increase in violence due to “turf wars” with Chinese mafias would further 

destabilize areas such as Mexico, Central America, and the Caribbean, which are 

closely connected to the United States in economic and human terms, and whose 

most vulnerable and marginalized historically seek refuge in the United States 

when conditions worsen.

Finally, although Chinese communities in Latin America are not themselves a threat, given evidence that they are the nexus for organized crime ties 

between the PRC and Latin America, it is a national security risk that US and 

Latin American authorities have almost no visibility into them.

The United States has a strategic interest to work with both the PRC 

and Latin American governments to manage the challenge posed by expanding 

China–Latin America criminal ties. Indeed, this area is arguably one of the most 

promising arenas in which the PRC, the United States, and Latin America can 

work together for the benefit of each and, in the process, build confidence not 

only in the China-US bilateral relationship, but also Latin America’s view of the 

US as a partner. The US already has programs for working with the Chinese on 

criminal issues in major cities with substantial Chinese populations, including 

San Francisco and Los Angeles. Through multilateral forums, and empowered by 

new trilateral agreements, the US, China, and Latin American authorities should 

set up multinational anti-crime mobile assessment and training teams and, eventually, “fusion centers” in the region. The Chinese government would provide 

translators with experience in Mandarin, Cantonese, Hakka, and other dialects, 

as well as access to Chinese police and other databases. The US should involve 

agencies such as the DEA, ATF, FBI and select state and local police forces, and 

use its own experiences in working with the Chinese on crime issues to help 

Latin American police forces do so effectively.

It is perhaps ironic, but collaboration between the United States, China, 

and the countries of Latin America on organized crime could be an important 

vehicle for building confidence and helping to overcome some of the tension as 

China expands its presence in Latin America in the context of the dominant US 

position there. Indeed, if such collaboration were channeled through multilateral 

American institutions such as the OAS, it could show that continuing to include 

America in the region and its institutions is desirable, as it reaches out to China 

and other actors.
R. Evan Ellis 129

Notes

1 This chapter was updated and expanded from the essay, R. Evan Ellis, “Chinese Organized Crime in Latin America,” Prism, vol. 4, no. 1 (December 2012): 67–77. 2 “Sospechado de facilitar el accionar de la ‘mafia china’ en Brasil,” Noticiero Diario (Buenos Aires, Argentina). 

3 Francisco Gómez Silvia Otero, “Alertan sobre la presencia de mafia rusa y china,” El 

Universal (Mexico City, Mexico, July 31, 2007). 4 “Aislados por el miedo a la violencia,” La Nación (Buenos Aires, Argentina, October 

11, 2011).

5 “Investigarán la mafia china en Argentina,” Diario Uno (Buenos Aires, Argentina, December 24, 2011).

6 “Mafia China en Argentina...’70 mil dólares o te matamos,” http://www.pdeqdigital.com (September 23, 2011).

7 “Un nuevo golpe de la ‘mafia china,” Clarin (Buenos Aires, October 2, 2011). 8 Alejandro Gamero, “La mafia china arribó a Mendoza e intimida a los comerciantes,” 

Diario Uno (Buenos Aires, Argentina, August 21, 2011). 9 The Overseas Compatriot Affairs Commission, established by what is today the government 

of the Republic of China to oversee issues of “overseas Chinese” ranks Perú as the country 

in the hemisphere with the largest Chinese population. It puts the number of Chinese 

in the country as a whole at 1.3 million persons. See “Overseas Compatriot Affairs 

Commission.” 

10 “Ciudadano chino cayó cuando iba a matar a su cuarta víctima,” El Comercio (Lima, 

Peru, June 22, 2010). See also “Balacera en chifa alarmó a vecinos del Rímac,” El Comercio

(Lima, Peru, January 21, 2011).

11 “Mafia china lanzó bomba a chifa chalaco,” Trome (May 8, 2011). 12 “El 95% de las llamadas de extorsión sale de las cárceles de Lima,” El Comercio (Lima, 

Peru, January 28, 2012).

13 “Investigan si mafia china del Dragón Rojo asesinó a empresaria de Gamarra,” La 

Republica (Lima, Peru, August 3, 2012). See also “’Dragón Rojo’ habría usado sicarios 

limeños para matar empresaria de Gamarra,” La Republica (Lima, Peru, August 5, 2012). 14 Juan Carlos Leal, “Caen cuatro chinos,” La Prensa (Lara, Venezuela, April 10, 2010). 15 “Denuncian la presencia de ‘mafia china’ en el país,” El Universo (Guayaquil, Ecuador, 

September 8, 2009).

16 See, for example, Rafáel Rodríguez, “Cárcel para miembros de la ‘mafia china,’” La 

Estrella (Panama City, Panama, November 9, 2008). 17 “Caso de los asiáticos asesinados es un hecho aislado, ministro Mulino,” La Estrella

(Panama City, Panama, September 19, 2011).

18 Ana-Lisa Paul, “Police deny Chinese singled out for criminal attack,” The Guardian

(Trinidad, July 19, 2012).

19 “Chinese Triad expands in T&T,” Trinidad Guardian (Port of Spain, Trinidad, May 17, 

2011).

20 For an example of this problem in Venezuela, see Jhonathan Raul Segovia, “Cicpc 

desmantela mafia China en Carora,” Diario de los Andes (April 11, 2010). 21 “La mafia china trafica cocaína en Perú,” Perú 21 (Lima, Peru. August 13, 2010).
130 The Strategic Dimension of Chinese Engagement with Latin America

22 “Mas evidente presencia de migrantes de otros continentes en Latinoamérica: ONU,” 

Milenio (Mexico City, Mexico, February 1, 2012). 23 Sam Logan, “Ecuador: China’s Human Trafficking Backdoor to the USA,” ISN Security 

Watch (February 2, 2009). 24 “Operan en la ciudad mafias internaciónales,” Reforma (Mexico City, Mexico, October 8, 2007).

25 “Deportaciones y expulsiones de ciudadanos chinos se dispararon en 2008, según 

datos del DAS,” El Tiempo (Bogotá, Colombia, December 21, 2008). The surge in Chinese 

also created a financial and administrative crisis for Colombian authorities, who lacked 

the resources to deport the enormous quantity of Chinese that the DAS had detained. 

See “Otro grupo de chinos trató de utilizar a Colombia como trampolín para llegar ilegalmente a E.U.,” El Tiempo (Bogotá, Colombia, May 11, 2007). 26 “China complacida por lucha del tráfico de personas en Ecuador,” El Universo (Guayaquil, Ecuador, November 14, 2008).

27 Manuel Pascual, “Funcionarios de RENIEC Peruana implicados con mafia china que 

trafica personas,” La Gran Época (July 31, 2011). 28 “Red de 22 empleados del Reniec implicados en tráfico de chinos,” El Comercio (Lima, 

Peru, July 25, 2011).

29 “Red de 22 empleados del Reniec implicados en tráfico de chinos,” El Comercio (Lima, 

Peru, July 25, 2011). See also Manuel Pascual, “Funcionarios de RENIEC Peruana implicados con mafia china que trafica personas,” La Gran Época (July 31, 2011). 30 For evidence of the operation of Chinese trafficking networks in Uruguay, see “Indagan red de tráfico de personas,” El Pais (Montevideo, Uruguay, November 14, 2012). 31 “Más de 50 chinos fueron ‘traficados’ en dos años,” El Pais (Montevideo, Uruguay, accessed February 20, 2013). See also “Desbaratan en Uruguay una red de tráfico de chinos 

hacia la Argentina,” La Nación (Buenos Aires, Argentina, December 19, 2012). 32 “Detuvieron a dos paraguayos acusados de traficar chinos,” La Nación (Asunción, Paraguay, January 8, 2012). 

33 “Como opera en el país la mafia china,” Clarin (Buenos Aires, Argentina, May 12, 

2002). For recent cases involving operation of Chinese trafficking organizations in Argentina, see Daniel Rojas, “Desarticulan red de tráfico de chinos a Argentina,” El Pais

(Montevideo, Uruguay, December 18, 2012).

34 See, for example, “Seis chinos podrían ser deportados por estadía ilegal,” El Pais (Tarija, Bolivia, September 1, 2012).See also “Descubren asiáticos con estadía irregular en el 

país,” Los Tiempos (Cochabamba, Bolivia, February 2, 2007). 35 “Con trabajo en equipo se destapó el caso de las visas,” La Razón (La Paz, Bolivia, 

December 13, 2006).

36 “Capturan a traficante de chinos,” Reforma (Mexico City, Mexico, October 23, 2010). 37 “Borrando las huellas,” La Estrella (Panama City, Panama, April 26, 2011). See also 

“Tráfico de chinos en el gobierno del cambio,” La Estrella (Panama City, Panama, April 

25, 2011).

38 José Meléndez, “La mafia china aumenta el tráfico de personas en AL,” El Universal

(Mexico City, Mexico, May 10, 2007).

39 “Llegan a costa costarricense 61 inmigrantes dejados a la deriva,” Nación (San José, 

Costa Rica, April 23, 2007).
R. Evan Ellis 131

40 José Meléndez, “La mafia china aumenta el tráfico de personas en AL,” El Universal

(Mexico City, Mexico, May 10, 2007).

41 Ernesto U. Savona, “Case Studies of Organized Crime.” 42 Carlos Devers, “Apresan los primeros 15 chinos trataban de salir por Manzanillo; 

aumenta tráfico de ilegales – Rep. Dominicana,” El Nuevo Diario (March 22, 2012). 43 See, for example, “EE.UU acusa a Venezuela de no combatir el tráfico de personas,” 

Clarin (May 6, 2006). 44 Sailú Urribarrí Núñez, “Desmantelan banda que traía ilegalmente chinos,” El Universal (Caracas, Venezuela, April 20, 2007). 45 “Desmantelan red de tráfico de chinos en Puerto Ordaz,” La Patilla (Caracas, Venezuela, December 8, 2011).

46 “Chinese Triad expands in T&T” (May 18, 2011). 47 Ibid. 48 “13 Chinese found working illegally at Imbaimadai,” Kaieteur News (June 19, 2012). 49 “Cárteles mexicanos insisten en fabricación de droga, pese a limitantes,” La Prensa

(Mexico City, Mexico, December 15, 2009). See also “Solo mafias china y rusa superan 

al narco,” El Universal (Mexico City, Mexico, July 28, 2010). 50 “Capo mexicano capturado coordinaba el tráfico de drogas de Colombia y China,” 

Noticias 24 (Mexico City, Mexico, March 12, 2012). 51 Manuel Carvallo, “Lázaro Cárdenas, Michoacán, puerta de entrada de precursores 

químicos.” See also “Capo mexicano capturado coordinaba el tráfico de drogas de Colombia y China,” Noticias 24 (Mexico City, Mexico, March 12, 2012). 52 “Confiscan casi 32 toneladas de precursores,” ANSA Noticero en español (September 

22, 2012).

53 “Cárteles México elevan ventas metanfetaminas con nuevos métodos,” Reuters (November 5, 2010). See also Carmen Flores, “México, principal proveedor de metanfetaminas a EU,” La Prensa (Mexico City, Mexico, November 29, 2010). 54 Found with $205,000 in cash. “Chinese-Mexican businessman found with $205M 

cash says he sold black market meth chemicals,” New York Newsday (October 23, 2009). 55 “Denuncian mafias en América Latina,” El Universal (Caracas, Venezuela, August 1, 

2007).

56 “Guatemala incauta 17,6 toneladas de pasta cocaína procedente Taiwán,” Los Angeles 

Hoy (Los Angeles, California, August 14, 2012). See also “Autoridades guatemaltecas 

decomisan 110 toneles de precursores para drogas,” El Mercurio (Quito, Ecuador, August 

24, 2012).

57 “Policía confisca 40 toneles con precursores químicos en puerto guatemalteco,” El 

Mundo (San Salvador, El Salvador, August 17, 2012). For a previous case of the same nature, see “Decomisan en Guatemala 18.800 kg de precursores químicos procedentes de 

China,” El Universo (Guayaquil, Ecuador, July 29, 2012). 58 “Decomisan en Guatemala 720 toneles de químicos para fabricar drogas,” La Nación

(Asunción, Paraguay, April 13, 2012).

59 “Aseguran más de 194 toneladas de precursor químico en Michoacán,” El Economista

(Mexico City, Mexico, January 17, 2012).

60 “Advierten en Perú por Narco mexicano,” Reforma (Mexico City, June 4, 2011). 61 “Los hermanos González, juzgados en Malasia por “narcotráfico,” La Prensa
132 The Strategic Dimension of Chinese Engagement with Latin America

(Mexico City, Mexico June 24, 2011).

62 “Se quintuplica número de ‘mulas’ capturadas en China,” El Tiempo (Bogotá, Colombia, August 5, 2012). See also “Quería $30 millones y obtuvo cadena perpetua en China,” 

El Tiempo (Bogotá, Colombia, October 14, 2012). 63 “Tres mafias chinas, en la mira de la Policía,” El Tiempo (Bogotá, Colombia, October 

22, 2012).

64 “Arrestan a 5 mexicanos en Hong Kong por tráfico de droga,” Milenio (Mexico City, 

Mexico, September 19, 2011).

65 Jose Melendez, “Carteles usan como bodega a Costa Rica,” El Universal (Mexico City, 

Mexico, January 1, 2013).

66 “Cuento chino con colombianos presos,” La Estrella (Panama City, Panama, September 9, 2012).

67 “Cerca de 1.500 kilos de droga provenientes de Ecuador, decomisados este año en 

América, Europa y Asia,” El Universo (Guayaquil, Ecuador, July 7, 2012). 68 Ernesto U. Savona, “Case Studies of Organized Crime,” http://people.exeter.

ac.uk/watupman/undergrad/rtb/caseorg.htm.

69 Ernesto U. Savona, “Case Studies of Organized Crime,” http://people.exeter.

ac.uk/watupman/undergrad/rtb/caseorg.htm. 70 Such contraband often requires falsification or misrepresentations on customs and 

other transit documents, requiring a certain level of collaboration between organizations 

on both the sending and receiving side. As an example, see “Perúvian Seizure of Contraband Goods from China,” El Comercio (Lima, Peru, December 18, 2012). 71 Juan Gabriel Tokatlian, “A View from Latin America,” In China’s Expansion into the 

Western Hemisphere, Riordan Roett and Guadalupe Paz, eds. (Washington, DC: Brookings Institution Press, 2008): 88. See also Rex Hudson, “Terrorist and Organized Crime 

Groups in the Tri-Border Area (TBA) of South America,” report (Washington, DC: Federal Research Division, Library of Congress, 2003). See also Alejandro Kenny, “China’s 

Presence in Latin America: A View on Security from the Southern Cone,” Military Review

(September–October 2006): 60–66.

72 For an example of this problem in Venezuela, see Jhonathan Raul Segovia, “Cicpc 

desmantela mafia China en Carora,” Diario de los Andes (April 11, 2010). 73 “Vende La Familia ¡mineral a China!” Reforma (Mexico City, October 14, 2010). See 

also “China compro hierro hurtado por La Familia con valor de 42 mdd,” Milenio (Mexico 

City, Mexico, October 14, 2010).

74 Juan F. Jimenez Mayor, Minister of Justice and Human Rights, Government of Perú, 

Presentation to Interamerican Dialogue (Washington, DC, March 23, 2012).

75 “México, el proveedor de armas de Latinoamérica,” El Universal (Mexico City, Mexico, November 22, 2011).

76 William La Jeunesse, Maxim Lott, “The Myth of 90 Percent: Only a Small Fraction 

of Guns in Mexico Come From U.S.,” Fox News (February 4, 2009). 77 “Advierten de contraband de armas rusas y chinas en México,” El Universal (Mexico 

City, Mexico, April 1, 2008).

78 Interview with a Mexican police official, who requested to remain anonymous. 79 Jorge Alejandro Medellín, “DF, punto estratégico en tráfico de armas,” El Universal

(Mexico City, Mexico, January 18, 2008).
R. Evan Ellis 133

80 “China rejects arms trade accusation,” China Daily (Beijing, China, July 26, 2007). 81 “Colombia pide la captura de un diputado venezolano por ‘Farcpolitica’,” El Tiempo (December 5, 2009). See also “Fiscalía colombiana ordena detención de diputado 

venezolano Figueroa,” El Comercio (Quito, Ecuador, December 6, 2009). 82 “Policía mexicana capturó a capo del narcotráfico conocido como el ‘Rey de la heroína’,” El Comercio (Lima, Peru, March 14, 2010). 83 “Vinculan juego clandestino brasileño con mafias de Rusia e Israel,” Xinhua News 

Agency (Beijing, China, December 12, 2011). 84 See, for example, “British Virgin Islands,” China Offshore, http://chinaoffshore.net/

content/british-virgin-islands.

85 “Operan en la Ciudad mafias internacionales,” Reforma (Mexico City, Mexico, October 

8, 2007).

86 For an example of this problem in Trinidad and Tobago, see “Cops Link Chinese to 

Organized Crime—Trinidad & Tobago,” Guardian (May 16, 2011). For an example of this 

problema in Venezuela, see Jhonathan Raul Segovia, “Cicpc desmantela mafia China en 

Carora,” Diario de los Andes (April 11, 2010). For examples of this problema in Argentina, 

see Alejandro Gamero, “La mafia china arribó a Mendoza e intimida a los comerciantes,” 

Diario Uno (Buenos Aires, Argentina, August 21, 2011). See also “Detuvieron a dos paraguayos acusados de traficar chinos,” La Nación (Asunción, Paraguay, January 8, 2012). 87 German Dam V. “Desmantelan red de tráfico de chinos en Puerto Ordaz,” La Patilla

(Caracas, Venezuela, December 8, 2011).

88 “Investigarán la mafia china en Argentina,” Diario Uno (Buenos Aires, December 24, 

2011).

89 “Cops Link Chinese to Organized Crime,” Guardian (May 16, 2011). 90 “Ciudadano chino cayó cuando iba a matar a su cuarta víctima,” El Comercio (Lima, 

Peru, June 22, 2010).

91 “La mafia china trafica cocaína en Perú,” Perú 21 (Lima, Peru, August 13, 2010).

135

Chapter 7

A “Strategic Triangle” between the PRC, 

the US, and Latin America?1

Overview

As noted in the introductory chapter, an underlying theme behind this work’s 

examination of China’s impact on the strategic landscape of Latin America is that 

an interrelationship exists between the actions of the PRC in Latin America and 

the security dynamics of both the US and the region. While scholars have long 

written of a the relationship between the United States, the PRC, and China as 

“triangular,” the purpose of this chapter is to examine the concept critically, to 

establish whether it is accurate to talk about such a “triangle,” and if so, what it 

means.

The first major reference to this “triangular relationship” was “Latin 

America, China, and the United States: a Hopeful Triangle,” the brief 2007 essay by Juan Gabriel Tokatlian.2 However, it was arguably Barbara Stallings’ 2008 

article, “The US-China-Latin America Triangle: Implications for the Future,” that 

most definitively introduced the concept; it appeared in China’s Expansion into the 

Western Hemisphere, the first English-language book by a major publisher on the 

China-Latin America relationship.3 Since that time, the term has been used in 

other significant works on China’s engagement with the region, including the 

January 2011 study “China, Latin America, and the United States: The New Triangle,” published by the Woodrow Wilson Center, the Institute of the Americas, 

and the China Academy of Social Sciences.4

Despite references to a China-US-Latin America triangle in press accounts and academic literature, the term is not a well analyzed academic construct, making it more of a label whose use is associated with a certain level of 

“intuitive validity.” At a superficial level, the logic of the term proceeds from the 

close historical linkage of the United States and Latin America, both in a positive 

and a negative sense. It is difficult to talk about the PRC’s significant expansion in 

the region without reflexively thinking of the reaction of US policymakers or the 

possible impacts on US corporations and interests. Ironically, China’s own political traditions and strategic interests also lead it to pay particular attention to the 

United States as it engages with Latin America. Despite emphasis on a “southsouth” approach to its interaction with developing countries, such as those of 

Latin America,5 the PRC has proceeded very cautiously in those relations. This 
136 The Strategic Dimension of Chinese Engagement with Latin America

can be seen, to some degree, as implicit recognition of the region as a US “sphere 

of influence” and mirrors the PRC’s likely desire to see the United States treat 

Asia as a “Chinese sphere of influence.” Although the PRC has publicly rejected 

the concept of “G-2” diplomacy,6 coordinating with the United States to “administer” the current global order, its strategic dialogue with the United States over 

Latin America gave the appearance that, at least in that region, it was willing to 

conduct precisely such “coordination.”7

The triangle concept has a certain resonance in both the United States 

and the PRC, but it is more problematic when viewed from the perspective of 

Latin America. The region would, arguably, prefer to see itself as strengthening 

relationships with multiple extra-regional actors as it projects more extensively 

into the global arena, rather than being “trapped” as a leg in a triangle with the 

two current global powers. Moreover, many in Latin America would take issue 

with the concept of the region as a “unitary actor.” Indeed, discussions of China 

in Latin America are replete with concerns about the region’s inability to present 

a unified position in dealing with the PRC.8

This chapter seeks to critically analyze the concept of a triangular relationship among the United States, China, and Latin America, both theoretically 

and empirically. In so doing, it argues that the notion of a triangular relationship 

is flawed and facilitates erroneous assumptions about the dynamics affecting the 

three actors. Yet, the concept is useful in that it highlights an important series of 

interdependencies and serves as a point of departure for a discussion on the types 

of bilateral and multilateral9 coordination that are advisable.

Problems with the Triangle Concept

As with any paradigm for simplifying and organizing thinking about a complex 

reality, the “triangular” characterization is incomplete. Such simplification is a 

common and, perhaps, necessary, part of the analytical process. The more serious problem with the paradigm, however, is that the nature of that simplification 

conceals some of the most important and most consequential behaviors for understanding the dynamics of China’s increasing engagement with the Western 

Hemisphere.

Like the triangle itself, these flaws take on an interrelated form: 

• The triangle masks other important actors that must be considered in the 

dynamic.

• The triangle incorrectly encourages a view of Latin America as a unitary 

actor.

• At its core, the triangle is a subtly neocolonialist way of approaching Latin 

America and its external relations.
R. Evan Ellis 137

Other Actors

The triangle concept downplays the importance of other actors whose interaction with the United States, China, and Latin America are also important. These 

include India, Russia, Iran, and Europe. While the triangle does not exclude 

these other actors per se, the focus on the interaction among China, the United 

States, and Latin America tends to conceal how other states, as well as non-state 

actors, play key roles in that dynamic. For example, the sometimes competing, 

sometimes complementary balance in Brazil’s relationships with India and China, played out in the Brazil-Russia-India-China (BRICS) and India-Brazil-South 

Africa (IBSA) forums, is arguably as relevant to Brazil’s foreign policy as is its relationship with the United States. Similarly, although much of the foreign policy 

of the Chávez regime is defined in terms of its opposition to US “imperialism,” 

Venezuela’s reliance on Russian arms, Chinese money, and its “anti-US” alliance 

with Iran occupy roughly equal importance. With respect to Argentina, when 

the PRC ceased taking in that nation’s exports of soy oil, India stepped up its 

purchases, helping to save Argentina from a much more significant economic 

problem and, in the process, weakening the PRC’s ability to pressure the Argentine government.10 In states that were Soviet clients during the Cold War, such 

as Cuba and Nicaragua, the importance of Russia as a partner in some sectors of 

some countries, and in some moments, rivals or exceeds, that of the PRC.

While the triangle concept conceals other actors that play a fundamental part of the dynamic in the hemisphere, it is important to understand that Latin American nations themselves generally do not define their external relations 

principally in terms of a triangle involving the United States and China. Indeed, 

while both China and the United States are important external referents for the 

region, Latin American countries and actors increasingly look toward the world 

in terms of a plurality of actual and potential partners, including Asian states other than China, such as Japan, Korea, and India, as well as actors such as Russia, 

the European Union, and Iran. The importance of those partners varies according to context (political alliances versus economic partnerships versus military 

sales, etc.). The importance also varies according to which Latin American country is doing the looking. 

During the Cold War, Latin American states sometimes took a UnitedStates-versus-the-Soviet-Union approach (although the nonaligned movement in 

the Cold War was an attempt to avoid being pulled in a triangle with the two 

superpowers). However, Latin American countries today do not conceptualize 

their external relations in terms of ties with the United States versus the PRC.

Latin America Not a Unitary Actor

The triangle concept implies that it is valid to group together the nations of Latin 

America with respect to their relationships with the PRC and the United States. 
138 The Strategic Dimension of Chinese Engagement with Latin America

But this is not the case. Latin America can be physically grouped as a geographic 

region, but referring to Latin America as one leg in a triangular relationship 

incorrectly assumes that actions by the other legs—the United States and China—impact Latin America as a whole. It also falsely assumes that Latin America 

“as a whole” deals with the United States and China.

While it is possible to discuss the overall triangular set of interactions at 

some level of abstraction, the nature of the relationship between each state and 

the PRC, and between each state and the United States, varies dramatically. 

Moreover, for many countries in the region, the most important issues 

and external relations are with each other, rather than with the United States or 

the PRC. Further complicating matters, the dynamics of the countries’ relationships with the PRC and the United States impact their relationships with each 

other. Brazil’s relationship with Peru and other nations on the western coast of 

South America, for example, is affected by its expanding ties with Asia, which 

increase the importance of access to the Pacific Ocean. Venezuela’s interest in 

exporting oil and minerals to China provides an incentive to improve relations 

with Colombia, in order to realistically contemplate overland highway, rail, and 

pipeline links between Venezuela and Colombia’s Pacific ports. Similarly, growth 

in trade between the PRC and virtually all of the Atlantic-facing nations, including Brazil, Argentina, and Uruguay, give the governments and companies of 

those nations interest in the Panama Canal expansion project.

A Neocolonialist Paradigm

Although the concept of a triangle to define the relationship among China, the 

United States, and Latin America is not, in itself, morally offensive, it subtly advances a neocolonialist paradigm by suggesting that best way to understand Latin 

America’s complex relationships with important parties beyond the region is to 

focus on two countries, the United States and the PRC. It also implies that the 

actions and decisions of these two actors will largely define outcomes for Latin 

America as the third “leg” of the triangle. This is flawed on two counts. First, 

as already noted, it conceals other possibilities, including a dynamic relationship between Latin America and multiple other global actors, creating space to 

have multidimensional relationships and achieve benefits from interactions that 

permit the growth of all parties. Second, it implies a logic, and perhaps even a 

legitimacy, for the United States and China to “coordinate,” not only with respect 

to their policies toward and activities in Latin America, but also in their “management of ” Latin America as the two dominant stewards of the global order, just 

as Great Britain, France, and Spain negotiated over colonies and “subordinate” 

states in a prior era.
R. Evan Ellis 139

Applying the Triangle Concept

Against a backdrop of cautions about the flaws and analytical pitfalls of the triangle concept, the balance of this paper turns to the interdependencies implied 

by that triangle and their significance. There are three important sets of interdependencies in this complex group of relationships: the impact of the China-Latin 

America relationship on the United States, the impact of the US-Latin America 

relationship on the PRC, and the impact of the US-China relationship on Latin 

America.

Impact of the China-Latin America Relationship on the United 

States

China’s relationship with the nations of Latin America impacts the United States, 

both in terms of the US relationship with the region and the US relationship with 

China itself. These effects are economic, as well as political and social.

In economic terms, the region’s purchase of goods from the PRC displaces the region’s purchase of products from US companies to some degree. 

Despite the adverse effect of direct competition from China, in many cases 

US-registered companies actually produce part or all of their products in the 

PRC or they source components there, increasing the competitiveness of those 

goods as they sell them to Latin America and other markets.

The mixture of competition and complementarity in investment is similar. Chinese investment in Latin America, to some degree, gives Chinese firms 

control over the region’s resources, such as petroleum and minerals. This implies 

that companies from the United States and elsewhere must source those same 

resources from other regions in order to service their customers or, alternatively, buy the resources at less advantageous prices and conditions on global commodities markets. Such logic suggests that commodities such as petroleum and 

minerals, over time, would cost US consumers more or that periodic sourcing 

problems would become more probable. Nonetheless, with most commodities 

available in a number of regions, and with the major Western multinationals still 

enjoying global positions that are generally stronger than those of the major Chinese state-owned enterprises, the extent of damage felt by the United States as a 

result of Chinese investment in Latin America is limited at best.

At the same time, Chinese purchases of US assets in Latin America provide liquidity to US companies to invest elsewhere. Although it eventually fell 

through, the $7.1 billion deal in which China National Overseas Oil Corporation was to purchase 30 percent of the assets of British Petroleum (BP) to help 

BP cover obligations stemming from the Deepwater-Horizon oil spill in the 

Gulf of Mexico, is a primary example.11

Beyond such “direct” impacts of Chinese investment in Latin America, 

in sectors such as cars, heavy machinery, and telecommunications equipment, 
140 The Strategic Dimension of Chinese Engagement with Latin America

investment by Chinese companies in the region also situates them to enter US 

markets. Such has been the case with the Chinese computer manufacturer Lenovo, which positioned itself to invest in the Mexican maquiladora sector with the 

hope of assembling Chinese cars using Chinese components for export to the 

United States, leveraging advantageous tax treatment under NAFTA. Similarly, 

investment promoters have cited other Latin American opportunities as indirect 

channels to the US market. They include Chinese companies’ production in Central America in order to export goods to the United States under the advantageous tax terms CAFTA, or production in Colombia, Panama, and Peru in order 

to enter the United States under the bilateral free trade agreements those nations 

share with the United States—although the ability to meet the provisions of the 

relevant agreements (particularly domestic content requirements) in order to 

realize such a tax savings is questionable. To date, Chinese investments in final 

assembly operations in Latin American countries, with an eye on entering the US 

market, have been limited. To a lesser extent, Chinese companies may see sales 

to Latin American markets as a way of incrementally increasing quality, giving 

them the experience and reputation required to successfully penetrate more discriminating US markets.

Moving from economics to political and social interdependencies, it is 

important to note that Chinese trade and investment with Latin American regimes indirectly undermine the ability of the United States to pursue its agenda 

in the region. This agenda focuses on multiple topics, from trade and respect for 

private property, to defense of the interests of US companies, to adherence to 

certain principles of democracy and human rights.

With respect to trade and investment, the availability of the PRC 

as an alternative market was one factor leading Latin America away from the 

US-oriented Free Trade Area of the Americas trading regime and, instead, toward establishment of a network of bilateral free trade agreements. Under these 

agreements certain nations, such as Chile, Peru, and Costa Rica, would attempt 

to both take advantage of the emerging Chinese market and serve as the link 

through which other nations in the region would do the same.12

Loans, investments, and commodity purchases from China allowed regimes relatively hostile to the United States, such as Venezuela, Bolivia, and Ecuador, to turn their backs on Western lending institutions like the International 

Monetary Fund and the World Bank. They also opened the way in some cases 

for default on loans, the nationalization of industries, or other actions hostile to 

the interests of Western companies; in the short term, these regimes were able 

to sidestep the negative consequences that such actions bring from traditional 

capital markets. 

Over the long term, however, there is potential for a “feedback effect” 

beneficial to the United States and other Western investors. High interest rates 
R. Evan Ellis 141

in the case of Ecuadoran loans13 and the questionable loan terms in Venezuela14

have already been used as political fodder by the opposition in those countries,15

increasing the likelihood that an explicit movement away from such loans and 

capital, and back to Western financial markets and institutions, may be on the 

agenda when changes in political regime occur in these states.

Chinese purchases, loans, and investments in Latin America have undercut the United States’ leverage in demanding adherence to certain practices of democracy, human rights and free trade. This is particularly relevant with 

respect to the nations in ALBA. In contrast to Western governments and institutions, Chinese investors traditionally do not link their loans and investments 

to the political practices of the recipient states. That said, special treatment of 

Chinese investments and protection from expropriations and other administrative action for companies operating in the country are often implicit conditions 

of Chinese investment—even where the same regimes are taking actions that 

prejudice Western companies. Similarly, as suggested previously, diplomatic recognition of the PRC is implicitly recognized to facilitate access to Chinese loans, 

investments, and markets, although significant loan packages for construction 

work by Chinese firms in Honduras and Nicaragua during the past three years 

suggest that this linkage is not as strong as it once was.

The economic success of the PRC, while pursuing relatively mercantilist policies and limiting democratic freedoms and Western-style human rights, 

sends a powerful message to Latin American regimes and societies that growth 

and prosperity can be achieved independent of adherence to Western economic 

proscriptions, political norms, and human rights practices. It is important to distinguish the lesson from Beijing that “prosperity can be achieved without heeding 

the United States” from the concept of a specific “Beijing Model” that the West 

can follow. Latin American leaders do not have to believe that they can follow in 

Beijing’s footsteps, only that they do not have to follow in those of the United 

States.

With respect to defense and security relationships, China’s engagement 

with Latin America has the potential for both positive and negative impacts on 

the United States. On the positive side, China’s donation of goods to countries 

and its sale of goods at relatively low prices have contributed to the ability of governments in the region to assert control over national territory and meet such 

challenges as narcotrafficking. The previously noted sale of Chinese K-8 aircraft 

to Bolivia 16 and the sale of radars to Ecuador17 (despite problems with the acquisition)18 are examples. The donation of trucks and buses to the Bolivian armed 

forces and nonlethal gear to the Colombian19 and Jamaica Defense Forces20 are 

other such examples.

Meanwhile, PRC loans for regimes hostile to the United States, such 

as those of the late Hugo Chávez (and now Nicolas Maduro) in Venezuela, 
142 The Strategic Dimension of Chinese Engagement with Latin America

Rafael Correa in Ecuador, and Evo Morales in Bolivia, provide these regimes 

with liquidity they would not otherwise have. This indirectly helps them persist 

in policies that are potentially harmful to US interests, such as allegations that 

the Venezuelan government provided support for the FARC as well as to radical 

indigenous groups in Peru, Bolivia, and elsewhere.

China’s willingness to sell low-cost arms to countries such as Venezuela 

has undermined the ability of the United States to work with its allies to impose 

arms-purchase controls on certain regimes. Chinese sales of K-8 and Y-8 aircraft 

to Venezuela, mentioned earlier, as well as sales of mobile radar systems, are the 

two highest-visibility examples.21 Chinese loans to Venezuela have also indirectly 

freed that government’s funds in other areas, making it easier for it to acquire an 

estimated $11 billion of military equipment from Russia since 2007, including 

Mi-17 helicopters, Su-24 fighter aircraft, Kalashnikov rifles, tanks, and armored 

vehicles.22

Beyond the nations of ALBA, Chinese military training and educational 

opportunities for virtually all Latin American countries that diplomatically recognize the PRC have opened the door for officials of these militaries to obtain a 

diversity of experience, undercutting to some degree their interest in working 

with the United States as a military partner.23 Nonetheless, the relatively low 

level of Chinese military engagement with the region to date has limited this 

impact.

Expansion of Chinese humanitarian military initiatives to the region, 

including participation in MINUSTAH, the Angel de Paz bilateral humanitarian 

exercise between Peru and the PRC in November 2010, and the visit of the hospital ship USS Comfort to the region in December 2011, represents an important additional dimension of this effect. At best, such initiatives send a subtle message to regional militaries that the United States is not the “only game in town,” 

(although US failure to give greater priority to the region arguably undercuts US 

influence more than any Chinese initiative). At worst, these initiatives permit 

the Chinese to enhance their working knowledge of Latin America’s militaries 

and facilities while allowing them the experience of operating in the region. The 

value of this experience would become obvious in the remote and undesirable 

event that the “friendly competition” between the PRC and United States turns 

more hostile and the Chinese seek to project a less benevolent military presence 

into the region.

Chinese military engagement with the region is also likely to cause 

discomfort because of the United States’ traditionally close security relationship with countries in Latin America. The PRC’s position may present particular 

challenges with respect to initiatives to ensure the security of Chinese companies and nationals. The growing physical presence of Chinese companies in the 

region in the coming years is likely to drive them, and their government, to 
R. Evan Ellis 143

collaborate more closely with Latin American security forces in managing the 

risk that comes from operating in remote or dangerous areas in extractive industries and on construction projects. This is already happening in Honduras, where 

the Honduran military provides security for Chinese firm Sinohydro work on 

the Patuca III hydroelectric project, as well as in Colombia, where China and 

the Colombian government coordinated to secure the release of the Great Wall 

Drilling Company oil crew kidnapped in Colombia in June 2011.24 In the course 

of protecting their companies and nationals, Chinese private security firms have 

also inadvertently become involved in violence in the region.

Chinese engagement with Latin America—economic, military, or otherwise—also impacts the United States at the political level. Hu Jintao’s five-nation trip to Latin America in November 2004, in conjunction with Chinese attendance at the APEC summit in Santiago, Chile, sparked a wave of political 

activity in the United States. This included not only public events by Washington, 

DC, think tanks but also hearings on Chinese engagement in Latin America in 

both the US House of Representatives (April 2005) and the US Senate (August 

2005). Indeed, Latin American leaders recognize the effect their China initiatives 

have within the US political system. The February 2011 announcement Colombian President Juan Manuel Santos made to The Financial Times concerning Chinese 

plans to build a “dry canal” across Colombia,25 for example, seemed timed to influence US congressional approval of the US-Colombia Trade Promotion Agreement.26

Chinese engagement with the region ultimately impacts the United 

States in broader terms, because the United States is intimately tied to the region 

in geographical, human, and economic terms. To the extent that PRC activities in 

Latin America inadvertently generate economic displacement and sociopolitical 

problems among nations in the region, the resulting turmoil potentially spills 

over to the United States. Examples could include future crises in countries that 

become heavily dependent on Chinese loans, such as Venezuela and Ecuador, 

political tension sparked by displaced manufacturing sectors in countries such 

as Brazil and Mexico, or controversy over the entry of Chinese firms into new 

extractive sectors such as agriculture in Brazil and Argentina or mining in Peru. 

Reciprocally, to the extent that Latin America’s exports to the PRC increase 

prosperity and bolster development, the US benefits: Latin America is able to 

purchase more US goods, and Latin American migration to the United States for 

economic reasons does not grow.27

Impact of the US-Latin America Relationship on the PRC

In economic terms, the attractiveness of the US market and trade agreements 

between the United States and Latin American countries condition where in the 

region Chinese investors calculate it profitable to go. Chinese auto companies 

and other manufacturers investing in the Mexican maquiladora sector, for example, 
144 The Strategic Dimension of Chinese Engagement with Latin America

have been motivated in part by interest in exporting Chinese firms’ products to 

the US market under provisions of NAFTA.28 The possibility of countries in Latin 

America serving as export platforms for Chinese goods into the United States 

has also been mentioned in the context of the US-Colombia Trade Promotion 

Agreement and in the process of negotiating and securing approval for CAFTA.29

In a more diffuse fashion, because of the close economic relationship 

between the United States and Latin America, US consumption and business activity that indirectly benefits Latin America enables the region to purchase Chinese products. At the level of the commercial enterprise, exports to the United 

States from the region may include goods sourced in China by Latin American 

manufacturers. At the personal level, some of the corporate earnings and salaries from these companies naturally go to the purchase of goods from the PRC, 

among other sources. Beyond corporations, although not traditionally considered in such terms, a portion of the approximately $50 billion in remittances 

sent annually to families in Latin America by immigrants living in the United 

States30 ultimately enables the purchase of Chinese goods in the region.

The ability of the United States to serve as a market and a source of 

investment for Latin America has influenced the region’s receptivity toward the 

PRC. The initial openness of the region to promises of investment and trade by 

Chinese President Hu Jintao came just after Latin America reached a historic 

low with regard to flows of investment from the United States and other sources.31 The 2007–2009 global financial crisis, which significantly impaired US purchases of Latin American exports and US credit to the region, strengthened the 

perceived importance of the PRC for Latin American governments, and Chinese 

commodity purchases and investments emerged as one of the key factors helping 

these governments weather the crisis. Nonetheless, as noted earlier, while the 

PRC has occupied an important symbolic role as the largest and most visible 

source of new capital and markets, it has not been the only player to which Latin 

America has looked as the region seeks to engage globally. Attention has also 

been given to India and other emerging markets of Asia, as well as traditional 

players, such as the European Union, and actors such as Russia and Iran.

At the political level, US engagement with Latin American countries 

has impacted the ability of the PRC to develop military and other ties in the 

region. Although journalistic and academic accounts often suggest that the 19th 

century Monroe Doctrine continues to be pursued by contemporary US policymakers, with a presumed desire to “keep China out” of the region,32 official US 

policy has repeatedly met Chinese initiatives in the hemisphere with a cautiously 

welcoming tone.33 Nonetheless, Latin America’s own leadership has responded 

to Chinese initiatives with a view of how engagement with China could damage 

its relationship with the United States. Colombia’s close relationship with the 

United States, for example, made the military leadership of the country reluctant 
R. Evan Ellis 145

to procure major military items from the PRC.34

The same logic has also applied to countries such as Venezuela, Ecuador, 

and Bolivia, for whom embracing the PRC politically and economically signaled 

displeasure with the United States. The degree to which a “bad” relationship with 

the United States has propelled a “positive” relationship with the PRC has increasingly gone beyond symbolism. As noted in previous chapters, the desire of 

Venezuelan President Hugo Chávez to diversify away from Venezuelan dependence on the United States as the nation’s primary oil export market, for example, opened the door for massive loan-backed Chinese construction projects, 

the purchase of Chinese commercial goods, and greatly expanded participation 

by Chinese oil companies.35 US refusal to sell F-16 fighter aircraft and components to Venezuela in 2006 prompted Venezuela to engage with China and other 

countries to procure military hardware. Similarly, as noted previously, Bolivia 

purchased Chinese K-8s after the United States blocked it from acquiring a comparable aircraft from the Czech Republic.36

Impact of the China-US Relationship on Latin America

This section considers the impact of the interaction between China and the US 

on Latin America, as distinct from the impact of the PRC alone on Latin America, which is considered in detail in Chapter two of this work.

In the commercial realm, US purchases of goods from PRC companies 

often come at the expense of Latin American exporters, thus mirroring the impact of Latin American purchases of Chinese goods on the United States. This has 

been shown, in particular, by the loss in Mexico’s market share vis-à-vis China in 

the US market.37

PRC interactions with the United States also affect Latin American currencies. Specifically, US officials’ argument that there is an “undervaluation” of 

the Chinese currency, the RMB, against the US dollar38 not only undermines 

the competitiveness of US goods but also undermines the competitiveness of 

goods from Latin American economies that use dollars (such as Ecuador and El 

Salvador) and those whose currency value is closely tied to the US dollar (such 

as Brazil’s real).

With respect to investment flows, there is a concern that capital injected 

into the PRC by US-based multinationals would otherwise have gone to destinations such as Latin America.39 Indeed, evidence indicates that expanded investment 

by Western companies into the PRC in the early 2000s came, to some degree, at 

the expense of FDI going into Mexico and Colombia.40 Reciprocally, decisions by 

US firms not to invest in China (in light of weak intellectual property protection, 

the inability to withdraw profits from China, or other concerns) potentially frees 

resources for projects in other global destinations, including Latin America.

Companies and projects in Latin America have been benefited from 
146 The Strategic Dimension of Chinese Engagement with Latin America

other actions,41 such as the PRC government’s desire to diversify away from 

holding its foreign reserves primarily in US treasury assets,42 including high-profile opportunities such the Commodity Investment Fund in 2007. Still, although 

not a likely scenario, were the PRC to rapidly unload its holdings of US treasury 

assets because of a loss of confidence in the United States’ ability to pay or a (possible but improbable) scenario of escalating hostilities with the United States, a 

financial crisis could be generated that would adversely impact Latin America—

as well as the rest of the globe.43

In the political realm, China’s relationship with the United States has 

conditioned how the PRC behaves toward Latin America, just as Latin America’s 

relationship with the United States conditions how it behaves toward the PRC, 

and Latin America’s relationship with China conditions its behavior toward the 

United States. This is because the reemergence of China in the contemporary 

global system is tied to access to developed country markets and technologies. 

Since the United States is one of the principal markets and technology sources, 

it carries critical strategic value for the PRC.

Whatever the truth regarding America’s “decline,”44 the United States 

still retains considerable power in the global system, as well as influence with 

allies and within global institutions. Theoretically it retains the ability to significantly impair the reemergence of the PRC were a consensus to appear in the 

United States to deny the PRC access to technology and markets and to use 

alliance structures and institutions to motivate others to follow suit.

Because of this, China’s leadership and that of its companies and agents 

have proceeded with caution in their relationships with countries that are overtly hostile to the United States.45 These include Venezuela, Ecuador, and Bolivia. 

China’s leadership has also been cautious with countries politically close to the 

United States, such as Colombia,46 and those geographically close, such as Mexico.47 While the PRC has proceeded in supplying billions of dollars in loans to 

the ALBA countries, often to fund construction projects for Chinese companies 

or for the purchase of Chinese goods, it has been prudent about becoming associated with initiatives and rhetoric linked to regimes that could be perceived as 

hostile to the United States.48

Strategic Implications

Interdependencies among the United States, the PRC, and Latin America call 

attention to the importance for each to consider how engagement with one partner will impact, and will be interpreted by, the other. However, as noted in 

previous sections, there are several key things that this interdependence does not

imply.

First, it does not imply that the China–Latin America–US triangle 

should be assumed to be the most important relationship binding these actors 
R. Evan Ellis 147

(even though it may be true in some cases). Russia, Iran, India, and the European 

Union, among others, have important relationships in the region, including a 

role in the dynamics of the China–US–Latin America triangle itself. India, for 

example, may be a useful US partner in certain parts of Latin America—such as 

the English-speaking Caribbean, Mexico, Colombia, Chile, Brazil and the Southern Cone—as the United States addresses China’s engagement with those countries. 

Similarly, it may be better at times to view individual Latin American 

countries in terms of interactions and tradeoffs among a multiplicity of external 

partners—among them the United States, China, India, Russia, and the European Union—rather than thinking first of a triangle involving the region, the PRC, 

and the United States.

In addition, many of the effects of the interactions between two sides 

of the triangle, particularly the United States and the PRC, go far beyond the 

triangle itself. Some are best characterized as global in nature, rather than just 

influencing Latin America. Indeed, the ripples produced by US-China dynamics on international markets, currency relationships, and financial transactions, 

among others, often produce effects in Asia or Europe that eclipse those felt in 

Latin America. 

The interdependence of the United States, the PRC, and Latin America 

does not mean that the United States and China should treat Latin America as 

a “unitary actor.” Nor should the United States and Latin America necessarily 

“pact” with respect to their collective treatment of Latin America, even were this 

possible given the divergent interests and commercial competition among US 

and PRC interests in the region. In a similar fashion, it is unlikely and inadvisable 

that Latin America, through an entity such as UNASUR or ECLAC, should coordinate with the PRC to assert a joint position toward the United States, just as it 

is unrealistic and inadvisable for the United States, through the Organization of 

American States or other multilateral forums, to forge such a joint position with 

the states of Latin America toward the PRC.

If it is not advisable or feasible for two parties in the triangle to develop 

a coordinated posture toward the third, neither is it necessarily in the strategic 

interests of any one party to seek to ensure that all three actors are automatically 

represented in the arenas in which they interact. For example, for the United 

States to bring the PRC into current bilateral security relationships or multilateral security institutions as a partner could send an undesirable signal that it 

unequivocally encourages and facilitates PRC engagement. Such a US posture 

could accelerate a process that should be approached cautiously in order to best 

serve US interests. Similarly, China’s pursuit of commercial and strategic interests with countries such as Venezuela, Ecuador, and Bolivia may be favored by an 

engagement that excludes the United States, just as part of the point of China’s 
148 The Strategic Dimension of Chinese Engagement with Latin America

interactions with multilateral regional bodies, among them UNASUR, CELAC, 

and ALBA, is that these forums, by design, exclude the United States.

Still, there are interactions for which dialogue that simultaneously involves the PRC, the United States,and Latin America are constructive, as addressed in the final chapter of this work. Even if China’s current rate of economic 

growth slows significantly, as analysts were predicting at the outset of 2012, the 

structure of the current, globalized world order implies that the PRC’s economic presence in and political impact on Latin America will continue. It will 

remain a permanent fixture of the hemisphere, alongside the European Union, 

India, and a host of other extra-regional actors. The United States is affected by 

this engagement, just as US activities in the region impact the PRC. This is not 

because the United States has a privileged position in the hemisphere but because 

it is inherently connected with Latin America in geographic, human, economic, 

and other terms. Thus, it is in the interests of the United States to recognize the 

interdependencies among itself, the PRC, and the nations of Latin America as one 

triangle among many. It is also in the interests of the United States to simultaneously engage with all relevant parties to ensure that those relationships develop 

in a manner that furthers the region’s stability and advances the interests of all 

parties involved, wherever those interests coincide.

Notes

1 This chapter is expanded and updated from the publication R. Evan Ellis, “The United 

States, Latin America and China: A ‘Triangular Relationship?” Working Paper Series (Washington, DC: InterAmerican Dialogue, May 2012).

2 Juan Gabriel Tokatlian, “Latin America, China, and the United States: a Hopeful Triangle,” Open Democracy (February 9, 2007).

3 Barbara Stallings, “The US-China-Latin America Triangle: Implications for the Future,” in China’s Expansion into the Western Hemisphere, Riordan Roett and Guadalupe Paz, 

eds. (Washington, DC: Brookings Institution Press, 2008).

4 Cynthia J. Arnson and Jeffrey Davidow, China, Latin America, and the United States: The 

New Triangle (Washington, DC: Woodrow Wilson Center, 2011). 5 Jiang Shixue, South-South Cooperation in the Age of Globalization: Sino–Latin American 

Relations (Beijing: Chinese Academy of Social Science, 2005). See also Monica Hirst, “A 

South-South Perspective,” in China’s Expansion into the Western Hemisphere: Implications for 

Latin America and the United States, Riordan Roett and Guadalupe Paz, eds. (Washington, 

D.C: Brookings Institution Press, 2008).

6 “Wen: China Disagrees to So-Called G2,” China Daily (November 18, 2009). 7 See, for example, “US Assistant Secretary Thomas Shannon to Visit China,” Peoples 

Daily Online (April 11, 2006). 8 See, for example, “Opportunities for Convergence and Regional Cooperation,” report of the High-Level Summit of Latin America and the Caribbean, Economic Commission for Latin America and the Caribbean (February 2010).
R. Evan Ellis 149

9 The term “poli-lateral” is used instead of the more conventional term “multilateral” to 

emphasize that Latin America should not be treated as a single actor in such interactions, 

nor should interactions necessarily be thought of in terms of traditional “multilateral” 

forums such as the Organization of American States or the United Nations.

10 Mercedes Colombres, “Según la Oncca, la crisis con China por la soja no frenó exportaciones,” La Nación (Buenos Aires, Argentina, July 21, 2010). See also Juan Carlos de 

Pablo, “Se triangula aceite a China, pero no es gratis,” La Nación (Buenos Aires, Argentina, 

July 25, 2010).

11 Brian Swint and Brett Foley, “BP’s $7 Billion Argentina Pan American Sale to Cnooc 

Said to Risk Collapse,” Bloomberg (New York, New York, September 30, 2011). 12 Strong ideological opposition to the Free Trade Area of the Americas by states such 

as Venezuela, as well as concerns by nations such as Brazil that the United States would 

use such an agreement as a platform for exporting finished manufactured goods to the 

region while continuing to protect its agricultural markets against the entry of Latin 

American products were also important factors in the “death” of the agreement.

13 “Ecuador negocia crédito de $ 2.000 millones con China,” El Universo (Guayaquil, 

Ecuador, June 15, 2011).

14 José de Cordoba, “China-Oil Deal Gives Chávez a Leg Up,” InterAmerican Security 

Watch (November 9, 2011). 15 See, for example, Fernando Villavicencio V., Ecuador Made in China (Quito, Ecuador, 

2013). See also “Chinese Loans Put Venezuela over Barrel,” The Washington Times (February 22, 2012).

16 “Avión K8 que ensambla Bolivia tiene antecedentes de falla en Venezuela,” Los Tiempos

(Cochabamba, Bolivia, June 24, 2011).

17 “Ecuador instalará cuatro radares en la frontera con Colombia este año,” El Universal

(Caracas, Venezuela, August 16, 2010).

18 “Fiscalía investiga FAE por contrato de radares,” El Universo (Guayaquil, Ecuador, 

May 21, 2012).

19 “Colombia and China Sign a Military Cooperation Agreement,” Colombia Air Force 

Official Website (June 26, 2012).

20 Evan Ellis, “China-Latin America Military Engagement: Good Will, Good Business, 

and Strategic Position” (Carlisle Barracks, PA:US Army War College Strategic Studies 

Institute, August 2011).

21 Ellis, “China-Latin America Military Engagement.” 22 “Venezuela compró armas a Rusia por 11.000 millones dólares,” El Universal (Caracas, Venezuela, April 14, 2011).

23 Nonetheless, the scope of Chinese military initiatives in the region is modest compared to US programs in the region. See Ellis, “China-Latin America Military Engagement.”

24 “Secuestran a tres chinos en Caquetá,” El Tiempo (Bogota, Colombia, June 9, 2011). 25 “Propuesta china de un ‘canal seco’ revive un viejo sueño,” El Tiempo (Bogota, Colombia, February 15, 2011).

26 “Rail Alternative to the Panama Canal Proposed by China to Colombia,” Mercopress

(February 14, 2011).

27 Aside from the heated debate in the United States regarding both the contributions 
150 The Strategic Dimension of Chinese Engagement with Latin America

and harm to the US economy by such immigration, it is important to recognize that migrant traffic—particularly across Central America through Mexico—has the undesirable 

side effect of providing a source of illicit revenue (via extortion) to the transnational 

criminal organizations operating in the area. It is also a source of manpower for their 

activities, which include illegal narcotics smuggling and feeding the ranks of the cartel 

“armies.” And there is the associated impact on organized crime and drug flows that such 

human flows imply.

28 Examples include Chinese automakers FAW and Geeley. See Marla Dickerson, 

“Mexican Retailer, Partner to Build Cars,” Los Angeles Times (November 23, 2007).

See also Emanuel Moreno, “La empresa china Geeley se instalará en León,” El Sol del Bajio

(July 11, 2008).

29 See discussion in J.F. Hornbeck, “The Dominican Republic-Central America-United 

States Free Trade Agreement (CAFTA-DR),” RL31870, Congressional Research Service 

(January 16, 2008).

30 “The Changing Pattern of Remittances: 2008 Survey of Remittances from the United States to Latin America,” Inter-American Development Bank (2011).

31 Foreign direct Investment in Latin America and the Caribbean 2010, Economic Commission on Latin America and the Caribbean (May 2011).

32 See, for example, Dai Bingguo, “Stick to the Path of Peaceful Development,” China 

Daily (December 13, 2010). 33 See, for example, the statement by former Assistant Secretary of State for the Western Hemisphere Arturo Valenzuela in Zhang Ting, “China ‘Not a Threat’ in L. America,” 

China Daily (August 19, 2011). 34 R. Evan Ellis, China in Latin America: The Whats and Wherefores (Boulder, CO: Lynne 

Rienner Publishers, 2009).

35 Chinese loans to Venezuela to date under the Chávez regime exceed $33.5 billion, 

including three injections of $4 billion each into the Heavy Investment Fund, $20 billion 

for the Long Range fund, and $1.5 billion to cover Venezuela’s obligations for the Abreu 

e Lima oil refinery, among others.

36 “Bolivia confirma compra de cazas chinos y un avión presidencial ruso,” El Universal

(Caracas, Venezuela, October 10, 2009).

37 With respect to the displacement of Mexican sales to the United States by the Chinese, see Kevin P. Gallagher and Roberto Porzecanski, The Dragon in the Room (Stanford, 

CA: Stanford University Press, 2010). See also Enrique Dussel Peters, “The Mexico-China Economic Relationship in Electronics: A Case Study of the PC Industry in Jalisco,” in 

The Impact of China’s Global Economic Expansion on Latin America, R. Jenkins, ed. (Norwich, 

UK: University of East Anglia, 2008).

38 See, for example, Glenn Somerville and David Lawder, “Treasury’s Geithner Says 

China Needs Faster Yuan Rise,” Reuters (January 12, 2012). 39 Rhys Jenkins and Enrique Dussel Peters, “The Impact of China on Latin America and 

the Caribbean,” DFID. No. AG4419 (April 2006).

40 Alicia García-Herrero and Daniel Santabárbera, “Does China Have an Impact on 

Foreign Direct Investment to Latin America?” in The Visible Hand of China in Latin America, Javier Santiso, ed. (Washington, DC: Organization for Economic Cooperation and 

Development, 2007).
R. Evan Ellis 151

41 Hui Ching-hoo, “China Investment Corp Sets Sights on Latin America,” Asia Asset 

Management (March 31, 2011). 42 See Jamil Anderlini and Tracy Alloway, “Trades Reveal China Shift from Dollar,” The 

Financial Times (June 20, 2011). 43 One vehicle for this impact would be to create a US liquidity crisis that would rein in 

investment spending and expand payrolls by US corporations, ultimately impacting US 

consumption. Latin American exporters of capital goods would, presumably, be affected 

first under such a scenario, followed by Latin American retailers.

44 See, for example, Robert Kagan, “Not Fade Away: The Myth of American Decline,” 

The New Republic (January 11, 2012). 45 See Suisheng Zhao, “China’s National Security Strategy and Diplomatic Engagement,” China-Latin America Task Force, University of Miami Center for Hemispheric 

Policy (December 12, 2006).

46 This has not prevented China from extensive commercial engagement with Colombia, particularly under its new president, Juan Manuel Santos.

47 This does not, however, explain the relatively large number of commercial initiatives that China has pursued in the Bahamas, whose islands are close to the southeast of 

the United States. These initiatives include operation and development of the Freeport 

Container Terminal and construction of the $3.5 billion Baha Mar resort in Cable Bay.

48 See, for example, “Alianza china con Venezuela es comercial y no ideológica,” El 

Universal (Caracas, Venezuela, April 7, 2010). See also “Periplo accidentado,” El Universal

(Caracas, Venezuela, September 27, 2008).

153

Chapter 8

The Way Forward

Introduction

This work has shown that China’s engagement with Latin America is relevant 

to the defense and security of the region. While virtually every aspect of this 

engagement affects the strategic environment of Latin America, the nature and 

extent of these impacts from a defense and security standpoint vary greatly. 

Some elements, such as military-to-military ties and arms sales, are immediately 

recognizable to security analysts, yet to paraphrase the congressional testimony 

of former Deputy Assistant Secretary of Defense Rogelio Pardo-Maurer, they 

do not imply a Chinese intention to establish a permanent military presence in 

the region or to pose a conventional military threat to the US or its allies in this 

hemisphere.1

Other aspects of Chinese engagement, such as commercial activities in 

the areas of telecommunications and space, and the presence of Chinese-built 

and Chinese-maintained infrastructure in these sectors, have potentially dramatic implications were the United States and the PRC ever to have to fight a global 

military engagement. At the same time, however, acknowledging and attempting 

to mitigate these risks presents the United States with a strategic paradox; taking 

actions based on the possibility that the PRC could be an enemy in the future 

helps to ensure that it will become one.

Still other dimensions of the relationship, such as growing China–Latin America organized crime ties, are consequences that must be addressed by 

national security planners. They should not be viewed as a source of conflict 

between the US and the PRC, but rather represent an opportunity for the US, 

the PRC, and the states of Latin America to work together on common problems 

for the benefit of the region.

Policy Recommendations

In the current world order, characterized by ever greater connectedness with respect to flows of information, goods, people, and money,2

 the linkages that have 

grown between the PRC and Latin America, particularly in the past decade, are 

unlikely to disappear any time soon.

The dilemma for US and other policymakers is that in facing the complex mix of opportunities and threats presented by expanding Chinese engage-
154 The Strategic Dimension of Chinese Engagement with Latin America

ment with Latin America, the three principal groupings of policy alternatives 

each involve significant risks and downsides: (1) attempting to “contain China” 

in the region, (2) accelerating its entry by collaborating with it as a partner, and 

(3) trying to manage the status quo.

It would be both unrealistic and unwise for US policymakers to think 

in terms of “containing the PRC” in Latin America. Not only is it impossible to 

block flows of people, information, and commerce between the PRC and the 

sovereign states of the region, but it would likely do more damage to the image 

of the US in the region than any long-term strategic benefit that it might bring 

about. If the alternative offered by the PRC undercuts the disposition of Latin 

American governments to work with the US on issues such as democracy and 

human rights, being seen as trying to “keep China out” of the region will make its 

member states even less disposed to cooperate with the US.

On the other hand, reaching out to “welcome” the PRC into the hemisphere as a partner would be a bold step, but would certainly accelerate the rate 

of advance of the PRC into the region by sending a signal to those Latin American 

governments and commercial players “on the fence” that the US “endorsed” dealing with Chinese companies, banks, and government organizations. US-Chinese 

“partnerships” would also accelerate this advance by helping the Chinese to build 

institutional and personal ties that they could then leverage separately for their 

own commercial and strategic purposes. While this work has argued that there 

is little evidence that the Chinese are using their current commercial ties for 

military purposes against the United States and the region, it has also shown that 

Chinese activities in some sectors do raise concerns and, over the long term, 

the development of these positions does strategically damage the position of the 

United States and its allies in the region, both commercially and otherwise. As 

the chapter on the impact of the PRC on the region and the chapter on organized 

crime linkages showed, such expanding ties do have negative consequences for 

the region that, while not the “fault” of the Chinese companies or governments, 

must be planned for.

Finally, the continuation of the current strategy of “managing” the 

US-China-Latin America relationship as the Chinese presence in the region gradually expands arguably presents lower short-term risks to the US than the other 

strategies, but also is the strategy that offers the least hope for a positive outcome 

over the long term. On the one hand, an attitude of “cautious acceptance” of PRC 

activities in the region sustains historically rooted perceptions by the countries 

in the region that the US continues to subscribe to some version of the classic 

“Monroe Doctrine” in which it regards the region as a series of “protectorates,” 

while also failing to create a venue for improving US-China relations. In short, 

such a US policy may delay both the advance of the PRC in Latin America and the 

accumulation of strategic dominance by the PRC globally, but at the end of the 
R. Evan Ellis 155

day, absent an unforeseen global shift such as the collapse of the PRC in its own 

economic, ethnic, and demographic contradictions, the US will still confront a 

PRC that is a global peer competitor and a Latin America in which the PRC has 

a strong strategic position while the US faces resentful neighbors.

In consideration of the challenges presented by the expansion of Chinese engagement in Latin America and the Caribbean and the strategic dilemma 

that it poses, this work argues that the most effective policy response is to try to 

cooperate and coordinate more effectively with China in the region, while at the 

same time working with both the PRC and its neighbors to define the regime in 

which that cooperation occurs to include maximum norms of transparency and 

multilateralism. Doing so will make it difficult for any party to pursue a course 

of action that could deliberately harm the other.

Beyond such considerations, if wisely managed, trade and investment 

from the PRC can contribute to the development of the region and help it to 

manage many of the security and other challenges that it currently faces. Such 

contributions include not only the expanded resources that come from product 

sales to, and investments from, the PRC, but also collaboration with and support 

from the Chinese government in areas such as transnational organized crime and 

humanitarian operations. 

Finally, although the fortunes of both the PRC and the United States 

may rise and fall in the coming years, they are bound in a web of mutual interdependence in both economic and strategic terms. Although the PRC may be 

viewed as a strategic competitor to the United States, it is in the interest of the 

United States that such competition occurs in the framework of acknowledged 

mutual interdependence and respect, defined by cooperation where possible, 

rather than the inevitability of conflict.

This work argues that cooperation with the PRC in Latin America and 

elsewhere should not depend on the expectation of the PRC’s “good behavior” 

but, rather, by the difficult calculation that it is in the interests of both the US and 

the PRC, and the international community more broadly, to effectively manage 

the competition rather than fight a war of global proportions. Within this conceptual framework, the guiding principle of the policy recommendations proposed by this paper is the promotion of closely monitored cooperation, where 

possible, and to create vehicles and expectations of transparency for an increase 

in the costs of treachery and a decrease in the possibility that it will succeed and 

benefit the perpetrator.

As part of this cooperation, in dealing with Latin America itself, the 

US, with or without the collaboration of the PRC, should work with the region 

to help it to manage its new engagement with the PRC in ways that leverage 

newly available resources from exports to and investments from the PRC, to 

effectively use them to address the challenges created by the new engagement, and, 
156 The Strategic Dimension of Chinese Engagement with Latin America

ultimately, to develop the region. This includes working with the Latin America 

and the Caribbean customs and taxation authorities to help it to more efficiently and effectively collect tax and royalties revenues from the new transactions 

and root out corruption, as well as to conduct technically correct and objective 

public bidding processes and negotiate balanced, technically detailed agreements 

that effectively protect the interests of all stakeholders. Such support might also 

include support in increasing the effectiveness of programs dealing with poverty, 

crime, education, and other developmental issues. Where appropriate, it should 

also focus on the security problems of the region, including new patterns of 

transnational crime, and violence against at-risk populations.

There are a number of areas in which such collaboration could be pursued with immediately fruitful results. Instead of parallel but separate missions 

by Chinese and US military hospital ships to the region, Chinese personnel could 

be brought onto missions by US hospital ships in the region. Reciprocally, US 

personnel could be brought onto missions by PRC hospital ships in the region to 

expand the capabilities and number of people who could be served by each mission while ensuring that both countries benefitted from the goodwill generated 

by the activity, without the sense that the two countries were using their hospital 

ships to compete against each other for goodwill. Such policies could also be 

expanded to other humanitarian missions, as well as exercises in preparation for 

natural disasters such as hurricanes, tropical storms, and earthquakes to ensure 

the most effective multinational response when such disasters actually occur.

Beyond humanitarian missions, the militaries of the PRC, the United 

States, and the states of Latin America should jointly pursue educational and 

training in the region. US military, PLA forces, and the Colombian military, for 

example, could develop a joint counterterrorism training facility. Similarly, the 

US, the PRC, and Chile could develop a joint professional military course on 

strategy, perhaps taught in the region at Chile’s strategic-level military school, 

ANEPE. In the process, the US, the PRC, and Latin American partners would 

learn from each other’s doctrine and tactics, and in the process reinforce mutual 

confidence and develop capabilities that would benefit the security environment 

of the region. A similar model could also be applied for multilateral police training in the region, with benefits to the public security forces of the region. Where 

appropriate, equipment and other resources could be simultaneously donated 

from the United States and the PRC. Spillover benefits of such training would 

also include a deepened appreciation by the Chinese of the public security environment of the region.

Taking collaboration in the training of public security forces one step 

further, the PRC, the US, and Latin American governments could also collaborate in the domain of private security. As Chinese companies expand their presence on the ground in Latin America, they are increasingly confronting the same 
R. Evan Ellis 157

challenges of social mobilization, crime, and terrorism that Western companies 

have long confronted in these countries, yet Chinese companies have very little experience with contracting private security forces in the region and are 

arguably reluctant to develop close formal relationships with Latin American 

militaries for fear of generating misunderstandings with the United States. By 

contrast to US-China collaboration in the public security arena, the analogous 

collaboration in the private security arena would have to be informational and 

advisory in nature, with the US, PRC, and Latin American governments sharing information regarding best practices for evaluating, hiring, and employing 

private security firms, as well serve as a clearinghouse of information regarding 

the public records of the companies involved, on the model of that pursued by 

Supervigilancia, the organization supervising private security firms and services 

in Colombia. Such collaboration would help Chinese companies make better 

decisions and more effectively protect their personnel, while also avoiding misunderstandings with the United States involving Chinese use of private security 

forces in the region. Beyond such benefits, such collaboration could also become 

a forum for coordination between the PRC and Latin American militaries for the 

protection of their corporations and employees in a manner that did not create 

concern on the US side.

As an extension of collaboration in the public security arena, the US, 

the PRC, and the governments of Latin America could also work together in 

the area of combating trans-Pacific organized crime. The United States, which 

already collaborates with the PRC to some degree in this area, could leverage 

its relationships with Latin American police and security forces to help the PRC 

and the states of Latin America organize effective joint organizations, centers, 

and information-sharing arrangements in areas such as the fight against human 

trafficking, money laundering, and criminal cartels. Particularly fruitful areas 

might include organizing flows of technical information and contacts between 

the PRC, Latin American countries, and the US, providing translation services 

for the analysis of documents, the questioning of subjects and the conduct of 

investigations, and the establishment of multinational “fusion centers.”

Indeed, “three-way” collaboration between the US, the PRC, and Latin America is likely to be particularly useful since many of the emerging new 

trans-Pacific criminal ties involve activities in each of the three. Narcotics flows, 

for example, may involve precursor chemicals purchased from China, with synthetic drugs manufactured in Central America and Mexico and sold in the United States, with the earnings repatriated to Mexico-based drug cartels using, in 

part, Asian financial institutions.

Finally, the United States, the PRC, and the governments of Latin 

America should conduct joint international crisis exercises in the region, with 

the objective of identifying potential sources of friction and resolving issues 
158 The Strategic Dimension of Chinese Engagement with Latin America

before they occur. Such activities might focus on scenarios of political change, 

accompanied by violence and uncertainty, in countries in which both the United 

States and China have strong strategic or commercial interests. Taking a page 

from interactions between the United States and the Soviet Union, such exercises should include not only strategic-level play, but also experiments with units at 

the tactical level to test theses regarding the potential for escalation under conditions of tension and uncertainty and the corresponding identification of actions 

to address problems where they were identified.

Turning from specific initiatives to general principles for future interactions, it is important for the United States and the PRC to maintain an ongoing dialogue with Latin America regarding the activities of each in the region. 

The Latin America subchapter of the US-China Strategic and Economic Dialogue, initiated by then–Assistant Secretary of State for the Western Hemisphere 

Thomas Shannon and continued by his successors Arturo Valenzuela and Roberta 

Jacobson, is a good model for such coordination. Arguably, however, such dialogue could be deepened by creating US-China working level subgroups that 

meet on a monthly basis to identify issues of concern and, where appropriate, 

elevate them to higher levels for resolution.

Nor should such dialogues be limited to bilateral engagements. Where 

possible, a greater effort should be made to engage the PRC through multilateral forums in the region, potentially under the auspices of the Organization for 

American States or the United Nations, so as to establish the precedent of working together, and avoid the impression that the United States and the PRC were 

“conspiring” to manage the affairs of Latin America.

In general terms, the goal of all of the activities outlined in this section 

is to establish the precedent of inclusion, multilateralism, and transparency so 

that the burden of proof would be to explain why the PRC or the US should be 

excluded from a major activity involving Latin America and the United States, 

rather than why they should be included. It also seeks to leverage the capabilities of the US, the PRC, and Latin American governments, working together 

to improve the security environment in the region for the benefit of all parties 

concerned, while building mutual confidence and trust.

Conclusions

In the realm of security and defense, the United States, the PRC, and Latin 

America are bound by interdependence. China’s engagement with Latin America, both military and commercial, impacts the security and defense environment of the region, both positively and negatively. At the same time, the United 

States is linked to Latin America in geographic, economic, and human terms. 

What happens with respect to the security environment in the region impacts 

the United States. Finally, the US-PRC relationship affects, and is affected by, 
R. Evan Ellis 159

Latin America. If the global strategic competition between the United States and 

the PRC degenerates into a new geopolitical conflict, Latin America will be one 

of the battlefields in which that competition plays out. Reciprocally, the outcome 

of US-PRC interaction in Latin America has ramifications for the interaction 

between the two powers globally; if the US and China come to “square off ” over 

an issue in Latin America such as Chinese support for ALBA or the activities of 

Chinese telecommunications companies, it could propel the global PRC-US relationship toward conflict. On the other hand, if the US and the PRC find a path 

to cooperate and build confidence in Latin America, it could define the path for 

the two powers to avoid conflict as they necessarily co-exist and interact globally.

In the process of working with the PRC in Latin America, the United 

States faces the risk of prematurely ceding strategic terrain to the PRC and thus 

accelerating its own global demise. Clearly, such collaboration much be managed 

with the utmost caution and with “eyes wide open” on all sides. At the same time, 

the US may have few other good choices. Cautious collaboration with the PRC 

may be the best option that the United States has to positively impact the rules of 

the game in which the PRC presence in Latin America and the broader emerging 

global competition between the United States and the PRC play out.

Notes

1 House International Relations Committee, Subcommittee on the Western Hemisphere, Hearing on “China’s Influence in the Western Hemisphere,” serial, no. 109-63 

(April 6, 2005).

2 The seminal work arguing this concept is arguably Moses Naim, Illicit: How Smugglers, 

Traffickers, and Copycats are Hijacking the Global Economy (New York: Random House, 2006).


William J. Perry Center 

for Hemispheric Defense Studies

Abraham Lincoln Hall

260 5th Ave., Bldg. 64

Ft. McNair, Washington, DC 20319-5066

www.ndu.edu/chds