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CHINA’S ADVANCE IN LATIN AMERICA

AND THE CARIBBEAN

JOINT HEARING

BEFORE THE

SUBCOMMITTEE ON 

THE WESTERN HEMISPHERE

AND THE

SUBCOMMITTEE ON ASIA AND THE PACIFIC

OF THE

COMMITTEE ON FOREIGN AFFAIRS 

HOUSE OF REPRESENTATIVES

ONE HUNDRED FOURTEENTH CONGRESS

FIRST SESSION

SEPTEMBER 10, 2015

Serial No. 114–95

Printed for the use of the Committee on Foreign Affairs

(

Available via the World Wide Web: http://www.foreignaffairs.house.gov/ or

http://www.gpo.gov/fdsys/

(II)

COMMITTEE ON FOREIGN AFFAIRS 

EDWARD R. ROYCE, California, Chairman 

CHRISTOPHER H. SMITH, New Jersey 

ILEANA ROS-LEHTINEN, Florida 

DANA ROHRABACHER, California 

STEVE CHABOT, Ohio 

JOE WILSON, South Carolina 

MICHAEL T. MCCAUL, Texas 

TED POE, Texas 

MATT SALMON, Arizona 

DARRELL E. ISSA, California 

TOM MARINO, Pennsylvania 

JEFF DUNCAN, South Carolina 

MO BROOKS, Alabama 

PAUL COOK, California 

RANDY K. WEBER SR., Texas 

SCOTT PERRY, Pennsylvania 

RON DESANTIS, Florida 

MARK MEADOWS, North Carolina 

TED S. YOHO, Florida 

CURT CLAWSON, Florida 

SCOTT DESJARLAIS, Tennessee 

REID J. RIBBLE, Wisconsin 

DAVID A. TROTT, Michigan 

LEE M. ZELDIN, New York 

DANIEL DONOVAN, New York 

ELIOT L. ENGEL, New York 

BRAD SHERMAN, California 

GREGORY W. MEEKS, New York 

ALBIO SIRES, New Jersey 

GERALD E. CONNOLLY, Virginia 

THEODORE E. DEUTCH, Florida 

BRIAN HIGGINS, New York 

KAREN BASS, California 

WILLIAM KEATING, Massachusetts 

DAVID CICILLINE, Rhode Island 

ALAN GRAYSON, Florida 

AMI BERA, California 

ALAN S. LOWENTHAL, California 

GRACE MENG, New York 

LOIS FRANKEL, Florida 

TULSI GABBARD, Hawaii 

JOAQUIN CASTRO, Texas 

ROBIN L. KELLY, Illinois 

BRENDAN F. BOYLE, Pennsylvania

AMY PORTER, Chief of Staff THOMAS SHEEHY, Staff Director

JASON STEINBAUM, Democratic Staff Director 

(III)

SUBCOMMITTEE ON THE WESTERN HEMISPHERE

JEFF DUNCAN, South Carolina, Chairman 

CHRISTOPHER H. SMITH, New Jersey 

ILEANA ROS-LEHTINEN, Florida 

MICHAEL T. MCCAUL, Texas 

MATT SALMON, Arizona 

RON DESANTIS, Florida 

TED S. YOHO, Florida 

DANIEL DONOVAN, New York 

ALBIO SIRES, New Jersey 

JOAQUIN CASTRO, Texas 

ROBIN L. KELLY, Illinois 

GREGORY W. MEEKS, New York 

ALAN GRAYSON, Florida 

ALAN S. LOWENTHAL, California

SUBCOMMITTEE ON ASIA AND THE PACIFIC

MATT SALMON, Arizona Chairman 

DANA ROHRABACHER, California 

STEVE CHABOT, Ohio 

TOM MARINO, Pennsylvania 

JEFF DUNCAN, South Carolina 

MO BROOKS, Alabama 

SCOTT PERRY, Pennsylvania 

SCOTT DESJARLAIS, Tennessee 

BRAD SHERMAN, California 

AMI BERA, California 

TULSI GABBARD, Hawaii 

ALAN S. LOWENTHAL, California 

GERALD E. CONNOLLY, Virginia 

GRACE MENG, New York 

(V)

C O N T E N T S 

Page

WITNESSES 

Evan Ellis, Ph.D., author, China on the Ground in Latin America .................... 5

Enrique Dussel Peters, Ph.D., director, Center for Chinese-Mexican Studies, 

School of Economics, National Autonomous University of Mexico .................. 31

Ms. Serena Joseph-Harris, chief executive officer, Sirius International (Caribbean) Defense Contractors Ltd. (former High Commissioner of the Republic 

of Trinidad and Tobago) ...................................................................................... 41

Ms. Margaret Myers, program director, China and Latin America, InterAmerican Dialogue ............................................................................................... 63

LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING 

Evan Ellis, Ph.D.: Prepared statement .................................................................. 8

Enrique Dussel Peters, Ph.D.: Prepared statement .............................................. 33

Ms. Serena Joseph-Harris: Prepared statement ................................................... 43

Ms. Margaret Myers: Prepared statement ............................................................ 65

APPENDIX 

Hearing notice .......................................................................................................... 88

Hearing minutes ...................................................................................................... 89

The Honorable Christopher H. Smith, a Representative in Congress from 

the State of New Jersey, and chairman, Subcommittee on Africa, Global 

Health, Global Human Rights, and International Organizations: Prepared 

statement .............................................................................................................. 90

(1)

CHINA’S ADVANCE IN LATIN AMERICA AND 

THE CARIBBEAN 

THURSDAY, SEPTEMBER 10, 2015

HOUSE OF REPRESENTATIVES,

SUBCOMMITTEE ON THE WESTERN HEMISPHERE AND

SUBCOMMITTEE ON ASIA AND THE PACIFIC,

COMMITTEE ON FOREIGN AFFAIRS,

Washington, DC. 

The subcommittees met, pursuant to notice, at 2:22 p.m., in room 

2172, Rayburn House Office Building, Hon. Jeff Duncan (chairman 

of the Subcommittee on the Western Hemisphere) presiding. 

Mr. DUNCAN. A quorum being present, the subcommittee will 

come to order. 

I would now like to recognize myself for an opening statement. 

And this is a joint subcommittee hearing between Asia-Pacific 

and the Western Hemisphere Subcommittees, and so we will allow 

opening statements from both chairmen as well as ranking members. 

In 1793, President George Washington warned a young America 

that a reputation of weakness could lead us to a loss of America’s 

rank among nations and that if we desired a secure peace it must 

be known that we are at all times ready for war. Washington also 

believed a uniform and well-digested plan was vital to meeting 

these objectives. 

While the need for strategic planning to pursue a position of 

strength and keep the peace finds relevance today, the United 

States seems to have forgotten Washington’s counsel. Broken promises, faded red lines, budget constraints, a lack of support for traditional allies, and an increasing reliance on tactics rather than 

strategy have communicated U.S. weakness to a watching world. 

In 2013, Secretary John Kerry affirmed that the era of the Monroe Doctrine is over, effectively putting other countries, such as 

China, on notice that the United States would no longer contend 

their actions in our neighborhood, the Western Hemisphere. 

In contrast to Roosevelt’s policy of the Good Neighbor in 1933, 

the U.S. has drifted instead toward benign neglect toward the very 

countries that have the greatest potential to impact the daily lives 

of the American people—those in Latin America and the Caribbean. China has taken notice, and China has stepped up into this 

vacuum of leadership. 

Today, China is weaving an intricate web of alliances in the 

Western Hemisphere through a vast array of diplomatic, economic, 

and military ties with multiple countries in the region. Although 

2

the United States remains the largest trading partner for Latin 

America—and I want to emphasize this—China is now the region’s 

second-largest trading partner and has free-trade agreements with 

Chile, Peru, and Costa Rica. 

This year, China hosted the first-ever China-CELAC summit in 

Beijing for Latin American and Caribbean nations. This organization expressly excludes both Canada and the United States. Since 2005, China has provided over $100 billion in credit to the region. Last year, China announced it would give nearly $35 billion 

in loans to the region in coming years. And, this year, China promised its investment in the region would hit $250 billion over the 

next 10 years. 

These are not just empty assurances. According to the InterAmerican Dialogue, China has provided 16 loans valued at over 

$56 billion to Venezuela, 10 loans valued at $22 billion to Brazil, 

10 loans valued at $19 billion to Argentina, and 12 loans valued 

at almost $11 billion to Ecuador. 

In particular, Chinese banks have effectively provided a lifeline 

to these governments, whose economic mismanagement and corruption prevent them from accessing Western institutions. In return, 

China receives oil, in the case of both Venezuela and Ecuador. In 

addition, China has been buying up land and companies in the region, investing heavily in infrastructure and ports, as well as gobbling up a lot of rare earth minerals. 

From 2008 to 2012, the 10 largest Chinese mergers and acquisitions occurred in Brazil and Argentina, and other deals have occurred in Ecuador, Venezuela, and Peru. 

Of significant interest are two specific infrastructure projects: 

First, a proposed Chinese-funded and Chinese-controlled Nicaragua 

Canal, estimated to cost nearly $7 billion, which would rival the 

Panama Canal and provide greater access for Chinese ships and 

potentially submarines to the waters near U.S. shores. Second, a 

Chinese-funded Twin Ocean railroad project connecting Peru and 

Brazil would also project greater Chinese influence and presence in 

Latin America. 

On a more troubling front, Brazil has provided the Chinese with 

access to its satellite tracking facilities, which could allow China to 

gain a more comprehensive picture of the flight paths of U.S. satellites. 

In addition, Chinese security ties to the region continue to deepen, with the Chinese arms sales to Bolivia, Venezuela, Ecuador, 

and Argentina. Reportedly, China has even expanded its arms 

sales beyond traditional nation-states through providing militarycaliber weapons to non-state actors such as the FARC terrorist organization in Colombia and drug trafficking organizations in Mexico. This activity has only served to increase the number of weapons in the hands of paramilitary forces and transnational criminal 

networks. 

It should be of grave concern to all Americans that the Chinese 

maintain a military presence in Cuba, specifically Lourdes, Bejucal, 

and Santiago de Cuba, all of which were former Soviet-era monitoring facilities. 

Clearly, China has big plans right here in our own hemisphere. 

And what are we doing about it? 

3

Traditional thinking about China’s engagement in the Western 

Hemisphere was that it was largely being done to counter diplomatic efforts in Taiwan and the region or as a way of paying for 

extractives or buying energy commodities to fuel their ever-expanding economy. 

Some have complained that China uses the region as a dumping 

ground for goods, such as steel, textiles, footwear, consumer electronics, and tires, and a visit to the marketplaces of the Caribbean 

and South America would seem to confirm some of those suspicions. 

Chinese companies operating in the region often bring their own 

workers, which they have no real effect on economic growth or jobs 

in places where they operate, creating a source of friction between 

China and the countries in the region. 

So, in conclusion, the U.S. cannot continue to simply ignore China’s presence in this hemisphere. The U.S. must engage more deeply in a sustained way with countries in the Western Hemisphere. 

It should serve as a jarring wake-up call that just a few days ago 

five Chinese Navy ships were spotted off the coast of Alaska. 

This hearing will be a comprehensive overview of China’s activities in the Western Hemisphere and consider how the U.S. can better balance those actions with more effective engagement in the region. So I look forward to hearing from today’s expert witnesses. 

And, with that, I will turn to the ranking member, Mr. Sires 

from New Jersey, for any opening statement he may have. And 

then I will come to the gentleman from Arizona. 

So, Mr. Sires, you are recognized. 

Mr. SIRES. Thank you, Mr. Chairman. 

Good afternoon. Thank you to our witnesses for being here today. 

Today, we are examining China’s continuing effort to assert influence in Latin America and in the Caribbean. 

Over the past decade, China’s engagement with Latin America 

has grown significantly, both economically and diplomatically. Chinese leaders have made several trips throughout the region, including Argentina, Brazil, Venezuela, Colombia, and Cuba. 

Their engagement comes, by the way, with foreign direct investment, loans, and increased economic ties. Specifically, they have 

pledged $250 billion in investment in the region over the next 10 

years. China’s interest in the region is a result of their constant 

search for new markets to procure natural resources such as various oils and minerals and agricultural products to feed their domestic needs. Over the past 12 years, trade between Latin America 

and China has grown from $17 billion to $262 billion. By many estimates, China is the third-largest source of foreign direct investment in Latin America and the Caribbean. 

While this can mean greater investment for an emerging Latin 

American economy and a boost in trade with the region, there are 

also pitfalls. Chinese investments come with baggage—with the 

baggage of dubious funding, environmental disregard, and poor 

labor and health conditions for workers. 

Proposed agreements like the $50 billion, 172-mile canal in Nicaragua risk displacing indigenous communities, destroying ecological 

preserves, and isn’t guaranteed to be completed. Mines and factories run by Chinese companies have reported dangerous working 

4

conditions, where laborers are overworked, mistreated, and constantly operating in unsafe environments. 

For too many years, the United States has focused on other parts 

of the world, which has led to neglect our own neighborhood. While 

many have viewed China’s increasing engagement in the region as 

a positive contributor to the region’s economic growth, we must remain vigilant of what the long-term consequences might be and reaffirm our own commitment to the region. If China wants to continue to engage our neighbors, we must insist that they comply 

with international labor, health, and environmental standards. 

I look forward to hearing from our panelists. 

And thank you. 

Mr. DUNCAN. Mr. Salmon, the former chairman of the Western 

Hemisphere Subcommittee in the last Congress, now-chairman of 

the Asia-Pacific Subcommittee, he is recognized for 5 minutes. 

Mr. SALMON. I am a lot of former things, and I am not going to 

admit to them all today. 

But I would like to thank my good friend Chairman Duncan for 

convening this joint hearing with me today on China’s presence 

and influence in Latin America and the Caribbean, what I believe 

to be an understudied yet strategically important trend. I am glad 

we have a distinguished panel here today to help shed light on this 

very important issue. We are here today to examine the extent of 

Chinese political, economic, and military influence in the region, as 

well as how that may affect U.S. strategic interests. 

China’s bilateral trade with this hemisphere grew from $15 billion in 2001 to $288.9 billion in 2013. These numbers are staggering and indicative of China’s dedication to bolstering its presence in the region. 

This January, China pledged to invest $250 billion in Latin 

America over the next 10 years, serving China’s strategic interests 

of securing access to energy, agriculture, and consumer markets 

and serving developing Latin American countries’ needs for infrastructure development and technological innovation. 

While China’s presence in Latin America and the Caribbean has 

been largely limited to trade and investment, there is a movement 

toward greater military relationships. Nuclear cooperation, shared 

space assets, and arms sales not only provide China with economic 

and military leverage in the region but also may expand China’s 

ability to mitigate one of our major advantages: Our relative geographic isolation. 

China will continue to allege that it has no foreign bases, meaning that their military posture is inherently defensive. But China’s 

non-explicitly military partnerships with countries in strategic geographic locations like Brazil to share space and satellite assets for 

Earth observation may raise some eyebrows. ‘‘No foreign bases’’ 

does not mean ‘‘no foreign presence,’’ and we should be wary of any 

potential military implications of Chinese presence in our neighborhood. 

In lending billions of dollars to service legitimate needs in developing countries in the Western Hemisphere, China has secured not 

only lucrative contracts but also diplomatic support. In the 1970s 

and the 1980s, China made similar inroads in economic assistance 

to Africa, propelled by the mutual benefit of resources for China 

5

and development of African nations. Today, Chinese infrastructure 

has expanded throughout the continent, and its presence there 

dominates. 

China’s involvement in Africa has also marked many African nations’ turn-away from formally recognizing Taiwan. In the Western 

Hemisphere, we currently have 12 states out of 22 total that have 

formal diplomatic relations with Taiwan, including Nicaragua, 

Paraguay, and Haiti. Consider China’s political benefits from 

stronger relations with Latin America and the Caribbean countries 

and what that would mean for the recognition of Taiwan. I am 

wary of whether China leverages its economic and political sway to 

further isolate Taiwan. 

China’s growing economic, trade, military, and diplomatic relationships with countries in Latin America and the Caribbean certainly have implications for U.S. foreign engagement in the region. 

We welcome China’s presence in the region and hope that they will 

yield mutual benefit for all countries involved. However, we hope 

this does not come at the expense of the rule of law and good governance and further entrenching inequality, corruption, illicit commerce, and violence. 

As the United States continues to look eastward toward Asia, a 

vital part of our strategic economic future, we must not forget the 

relationship with our closest neighbors. I look forward to the hearing today about China’s strategy within the Western Hemisphere 

and how we can more effectively manage our presence and our 

strategy and balance our relationship with our neighbors in the region and China. 

Thanks a lot, and I yield back my time. 

Mr. DUNCAN. Thank you, Chairman Salmon, for your great leadership and work on these issues in both hemispheres. And it is so 

important to the American people, so I appreciate that. 

Before I recognize you, the bio for each of the witnesses was provided beforehand; I am not going to read that. 

You have a lighting system in front of you. We are going to try 

to maintain a 5-minute rule. If you will, when it gets to yellow, just 

start trying to wrap up. When it gets to red, we are going to allow 

a little leeway, but we are going to move on. 

So I will go ahead and recognize Dr. Ellis first for 5 minutes. 

And thank you for being here. 

STATEMENT OF EVAN ELLIS, PH.D., AUTHOR, CHINA ON THE 

GROUND IN LATIN AMERICA 

Mr. ELLIS. Thank you very much, Chairman Duncan, Chairman 

Salmon, Ranking Member Sires, distinguished committee members. 

Thank you very much for the opportunity to share my analysis 

with you today. I will summarize my written remarks for the committee. 

Chinese engagement with Latin America, while producing some 

benefits for some actors in the region, is generating negative consequences, and not only for the region but also for the strategic position of the United States. Moreover, these consequences are 

evolving but not abating with China’s current economic deceleration. 

6

PRC trade with the hemisphere today is 20 times greater than 

it was in 2001, with China primarily purchasing low-value-added 

commodities while selling higher-value-added manufactured products and services. China has also loaned more than $119 billion to 

the region since 2005, with approximately three-quarters going to 

Argentina and the regimes of ALBA. 

The physical presence of Chinese companies in the region has 

taken off in the last 5 years, particularly in mining and petroleum, 

construction, manufacturing, telecommunications, logistics, and 

banking. This presence has given China a greater stake in the internal affairs of the countries in which they operate. 

With Taiwan, the PRC has generally honored its 2008 informal 

agreement not to woo countries, recognizing the others to change 

their diplomatic position. Yet leaders of countries recognizing Taiwan has regularly expressed interest in establishing relations with 

the PRC. Thus, if current Taiwan-ROC rapprochement breaks 

down, I believe that the PRC could rapidly eliminate the remaining 

basis of ROC diplomatic legitimacy in the hemisphere. 

I see the near-term objectives of the PRC in the hemisphere as 

principally economic, yet no less impactful for the U.S. and the region. Primary products: Food stuffs, markets, and technology. 

China’s President Xi has clearly engaged the hemisphere more 

boldly than his predecessors, including important trips in May 

2013 and July 2014. The latter included the first China-CELAC 

summit and, indeed, as Chairman Duncan pointed out, an important Chinese choice to frame its multilateral engagement with the 

hemisphere around an institution that excludes the United States 

and Canada. 

The current deceleration of the Chinese economy is likely to decrease PRC commodity investments and the value of commodity 

imports but will also likely expand Chinese efforts to sell its goods 

and services to the region and to pursue more loan-backed infrastructure projects, increasing tensions in an already-troubled relationship. 

I am concerned that the PRC engagement is indirectly undermining democracy and good governance in the region, as loans to 

populist regimes weaken the accountability of their leaders to citizens and institutions and facilitate corruption. 

In addition, PRC military activities in the Western Hemisphere, 

as acknowledged, are significant and growing. Chinese defense conglomerates, such as Norinco, are selling increasingly capable military goods to an ever-broader array of clients. In addition to the 

well-known sales to Venezuela, Ecuador, and Bolivia, the Peruvian 

Army just last month received 27 Chinese artillery vehicles, while 

Argentina plans to purchase Chinese ocean patrol vessels and armored personnel carriers, among other items. 

Chinese military personnel attend courses in Colombia’s 

Tolemaida military base and at Brazil’s Jungle Warfare School in 

Manaus. The PLA has progressed from participation in multilateral 

forces, such as MINUSTAH in Haiti, to bilateral engagements, including a November 2010 medical exercise with Peru and the December 2011 deployment of its hospital ship, Peace Ark, to the Caribbean. In October 2013, for the first time, Chinese warships conVerDate 0ct 09 2002 13:32 Oct 27, 2015 Jkt 000000 PO 00000 Frm 00012 Fmt 6633 Sfmt 6633 F:\WORK\_WH\091015\96051 SHIRL
7

ducted combat exercises in the region, including engagements with 

Chile, Argentina, and Brazil. 

My recommendations to the committee respectfully include: 

Number one, working with our regional partners to strengthen 

their government institutions for engaging with the PRC so that all 

get a fair and constructive deal; two, ratifying an effective transpacific partnership open to China in the future is one step in constructing a multilateral rule-of-law-based regime across the Pacific; 

three, facilitating ties between the Western Hemisphere and Asian 

partners who share our values, including Japan, South Korea, Australia, and India; four, expanding theater security cooperation to 

bolster the U.S. position as partner of choice in the region; five, 

prioritizing a functional inter-American system in which the OAS 

and not CELAC or UNASUR is the multilateral vehicle to engage 

China and resolve regional security issues; six, articulating a clearer vision of what the U.S. stands for in the hemisphere and why 

the U.S. approach best advances broad-based development, prosperity, and human dignity. 

Respectfully, the U.S. cannot and should not block China-Latin 

American engagement, but we must, I feel, work to ensure that it 

is consistent with our own security, while advancing the wellbeing 

of those with whom we share this hemisphere. 

Thank you very much for your time. 

[The prepared statement of Mr. Ellis follows:]

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Mr. DUNCAN. Okay. Is it ‘‘Dussel Peters’’ or just ‘‘Peters’’? 

Mr. DUSSEL PETERS. ‘‘Dussel Peters.’’

Mr. DUNCAN. All right. Dr. Dussel Peters is recognized for 5 minutes. 

STATEMENT OF ENRIQUE DUSSEL PETERS, PH.D., DIRECTOR, 

CENTER FOR CHINESE-MEXICAN STUDIES, SCHOOL OF ECONOMICS, NATIONAL AUTONOMOUS UNIVERSITY OF MEXICO 

Mr. DUSSEL PETERS. Okay. Thank you very much, Mr. Chairman 

and members of the subcommittees. 

I would like to share with you the work of the last 15 years we 

have been doing on the Mexico and Latin America-China relationship. And I also invite you to participate next Wednesday in a presentation of a report we will do with the Atlantic Council exactly on 

this topic, no? 

I would like to share with you three topics. 

First, the first issue, the increasing relationship of Latin America 

and China in all the topics that we have been mentioning is no coincidence, which means China has been in the last at least 10 

years releasing a group of white papers regarding this relationship. 

I would invite you to go through the cooperation plan of CELAC 

and China, the first ministerial meeting that was published in January 2015, which establishes very clear goals regarding trade, investment, infrastructure projects, and funding, respectively. 

There is no single Latin American country that so far has established a short-, medium-, and long-term strategy vis-a-vis China. 

This results in a substantial disadvantage for Latin America. 

Second, as you mentioned, China has become the second-largest 

trading partner of Latin America. Latin America has a huge trade 

deficit, and particularly relevant is the difference in the group of 

topics and of products that the region is exporting to China. Less 

than 5 percent of Latin American exports to China are of mediumand high-technological level. There is a huge gap with what China 

is exporting to the region, and this has also reflected and explains 

the region’s increasing disenchantment with its most dynamic partner. 

Finally, the third topic I would like to share with you is that, 

while it is well known that China has participated importantly in 

the NAFTA region and displaced also Mexican exports to the 

United States, probably the United States has been the main loser 

in this new triangular relationship between the United States, 

Latin America, and China. 

In the paper I submitted to you, we calculate that 72 percent of 

the United States exports to Latin America are threatened by Chinese exports. And probably much more important is that, if we assume the share of the United States in Latin American imports of 

2001 when China became a member of the World Trade Organization, if we assume the same share of Latin American imports in 

2014, the United States would have exported to Latin America 

more than $145 billion additionally. 

If we take this $145 billion in 2014, according to the Department 

of Commerce, this $145 billion accounts for 840,000 jobs that the 

United States would have gained, maintaining the same share in 

32

2001. Again, this is a substantial and critical topic not only for 

Latin America and for Mexico but for the United States. 

I finish with two recommendations. 

First, I invite very much both subcommittees and the House of 

Representatives, A, to support, fund, and create academic and private institutions in the United States to promote detailed understanding of a dialogue on the global reemergence of China, especially in Latin America and the Caribbean, since it also affects U.S. 

trade, production, and employment, especially in manufacturing 

and particularly in the automobile and auto parts sectors. 

Secondly, I invite you to actively participate in and support the 

important work that has been done in Latin America and the Caribbean on the many issues related to this new triangular relationship. Institutions such as CELAC, the Economic Commission for 

Latin America and the Caribbean, and the Inter-American Development Bank are some of the institutions where you could participate. 

Thank you very much for your time. 

[The prepared statement of Mr. Dussel Peters follows:]

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Mr. DUNCAN. Thank you very much for your testimony. 

And the Chair will now recognize Ms. Joseph-Harris. 

Thank you so much. 

STATEMENT OF MS. SERENA JOSEPH–HARRIS, CHIEF EXECUTIVE OFFICER, SIRIUS INTERNATIONAL (CARIBBEAN) DEFENSE CONTRACTORS LTD. (FORMER HIGH COMMISSIONER 

OF THE REPUBLIC OF TRINIDAD AND TOBAGO) 

Ms. JOSEPH-HARRIS. Thank you very much. And a very good 

evening to you, Chairman Duncan, Chairman Salmon, and Member 

Sires. 

My contribution comes at a very——

Mr. DUNCAN. Could you pull that microphone down just a little 

bit? There you go. 

Ms. JOSEPH-HARRIS. Is this better? 

Mr. DUNCAN. There you go. 

Ms. JOSEPH-HARRIS. Thank you very much. 

My contribution comes at a very fortuitous time. It is the culmination of a 4-year inquisition that has just concluded in relation 

to the formidable strategic progress that China has been making 

in both hemispheres, so that the statement on hand will be confined to the following: I shall describe China’s engagement with the 

Caribbean, why Caribbean countries are interested in Beijing, its 

objectives in the Caribbean and success to date, a description of the 

economic relations, and recommendations to the honorable Congress. 

China is now the third-largest investor in the Caribbean, with 

the United States and the European Union occupying the two top 

spots. Its share of foreign investment regionally is an estimated 9 

percent with trade volume of U.S., which is $156 billion. 

Given this fairly modest quantum, in order to make sense of the 

region’s magnetism to Beijing, we need to take stock of its strategic 

and ideological significance, bearing in mind that the Caribbean is 

part of the wider inter-American landscape, the history and character of which is uniquely circumscribed by legal and political instruments in principle and practice that has helped to shape this 

environment. 

The PRC is, in contrast, unconversant with these aphorisms. If 

only for this reason, their engagements will have serious repercussions, potentially so, that can very well challenge the political culture and democratic traditions and values of our hemisphere. 

In order to understand Beijing’s ambitions, we need to keyhole 

its interests. And these are essentially as follows in 11 short points: 

Sourcing and consolidating cheap supplies of food to sustain its 

burgeoning population. 

Gaining comparative advantage along key trading routes. The 

Caribbean, as already alluded, takes the form of the port development projects, and it forms part of key chokepoints that are vital 

to Western Hemisphere trade and defense concerns. 

Gaining access to raw materials and vital resources in anticipation of the looming problem of a worldwide resource scarcity in 

fuels, metals, and minerals. 

Infiltrating fuel markets through asset acquisition, as demonstrated in parts of the mainland, like Colombia and Venezuela. 

42

Securing access to reserves of natural gas, which positions Trinidad and Tobago an ideal strategic partner. 

Accessing and utilizing large areas of fertile land in promising locations, such as mainland Guyana, Suriname, and Belize. 

Diversifying and consolidating its commercial portfolio to attain 

competitive advantage and market supremacy. 

Introducing more enticing economic structures for countries to 

adopt. And this avenue provides a counterweight to the classical 

neoliberal model. 

Gaining a foothold on the U.S. market indirectly through frontline jurisdiction, such as Bahamas and Jamaica. 

And opening employment opportunities abroad for its tens of 

thousands of nationals that have been migrating to the urban 

areas in China in search of jobs. 

I shall now get into the main areas in which the Caribbean has 

been more or less lured toward engaging with Beijing. These are 

the constraints that governments in the Caribbean have been constructed with, which causes them to look to Beijing and partner 

with it: Inflexible fiscal policies; low gross domestic product growth 

rates; high levels of violent crime and illicit traffic; the inability of 

our governments to attract development assistance; the increased 

liberalization of global trade, which has diminished market access; 

the small size of countries, which depletes from the full benefits of 

economies of scale; and the failure of intraregional single market 

arrangements; as well as the increasing costs of energy in the face 

of fluctuating prices. 

Chairman, what I would recommend is that the U.S. and the 

Caribbean consolidate our deepening strategic relationships, which 

began in 2010 under the Caribbean Basin Security Initiative. This 

would essentially mean strengthening the regional security architecture through continued engagement with the United States, 

similar that has been done under the CBSI initiative, through more 

deepened security arrangements with our military, with our security and intelligence agencies, as well as interoperability and assetsharing. 

As a result of constraints of time, I would invite you, Chairman, 

and the rest of the listeners to refer to my most recently published 

inquisition, which provides compelling support in terms of statistical detail on those areas in which Beijing has been making inroads into the hemisphere. The study is called ‘‘The Twilight of 

America’s Omnipresence,’’ and it gives an in-depth analysis of the 

military inroads, economic inroads, and political inroads being 

made by Beijing and makes suggestions as to how the United 

States could strengthen and build its relationship with the Caribbean in order to rebalance itself within the hemisphere. 

Thank you, Chairman, for your time. 

[The prepared statement of Ms. Joseph-Harris follows:]

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Mr. DUNCAN. I want to thank you. 

And now Ms. Myers is recognized for 5 minutes. 

Thank you. 

STATEMENT OF MS. MARGARET MYERS, PROGRAM DIRECTOR, 

CHINA AND LATIN AMERICA, INTER–AMERICAN DIALOGUE 

Ms. MYERS. Thank you, and good afternoon. I would like to 

thank the committee and subcommittee chairmen and ranking 

members and other esteemed committee members for the opportunity to be here today. I will be summarizing my written testimony, which I have submitted for the record. 

Let me begin by saying that this hearing, ‘‘China’s Advance in 

Latin America and the Caribbean,’’ is very appropriately titled. As 

we have discussed, China’s presence in Latin America and other regions has grown at a remarkable rate in just over a decade. 

Latin American and Caribbean exports to China have increased 

23 percent per year, on average, since 2000, although that has 

slowed rather considerably in recent years. We have talked a lot 

about the $119 billion in finance that China has given to Latin 

America since 2005, and most of that is going to Venezuela, Ecuador, Argentina, and Brazil. There are numerous investors now 

present in Latin America—small private ones, large SOEs, banks, 

both commercial and policy banks, and also China’s sovereign 

wealth fund, although China’s foreign direct investment in the region is still fairly low. 

China’s growing presence, as we have mentioned, in Latin America is also apparent in cultural, educational, military, and political 

spheres, although over the past decade and a half so much of overall engagement has supported the objectives of China’s so-called 

‘‘going out’’ strategy. And these include securing access to raw materials, establishing new markets for Chinese exports, promoting 

Chinese brands—and there are many, many Chinese brands in 

Latin America now—and internationalizing Chinese firms. 

And much of what we see China doing in the region today can 

still be viewed as supporting these objectives. In this sense, China’s 

interest in the region has been rather static. But the relationship 

has also evolved in some very important ways, and I would like to 

use my remaining time to briefly highlight three examples. 

We have, first of all, seen some important changes in the way in 

which Chinese firms are investing in the region. Especially in the 

agriculture and energy sectors, there are growing efforts to invest 

not only in crop cultivation and mining and drilling, for example, 

but across entire supply chains—in production, processing, logistics, and marketing—this in order to better control supply and pricing and also to compete with other multinationals and also U.S. 

firms. 

Like in Asia, Latin America has also seen growing interest from 

China in the development of cross-regional transportation infrastructure, such as the proposed Brazil-Peru railway, but there are 

many, many other examples. These projects are largely intended to 

facilitate the transport of raw materials to port, especially along 

the Pacific coast. Pacific maritime routes are often favorable to 

those that go through the Gulf of Aden or other areas—transport 

security, in other words. 

64

Second, there is a perceived change or a growing focus on the 

part of China in region-wide diplomatic initiatives in Latin America and the Caribbean. And we have mentioned already the ChinaCELAC forum, which was established in 2014 and which excludes 

the U.S. and Canada. China has also recently announced several 

new regional credit lines and investment funds. China’s central 

bank announced this month that it will establish a $10 billion fund 

for investment in Latin American manufacturing or production capacity. 

And, finally, we have seen some important changes in Chinese 

firm operations. Recent case study analysis suggests that Chinese 

companies have made real advances in community relations and 

adherence to local, environmental, and labor standards. But complaints about Chinese companies continue to surface, and the environmental standards of China’s top lenders to Latin America are 

still weaker than those of other international financial institutions. 

There are also indications, troubling indications, that some Latin 

American governments have intentionally weakened standards and 

regulations in order to attract Chinese and other investment or to 

facilitate cross-Pacific trade. 

And China’s ongoing financial support for certain governments in 

the region, to include Maduro in Venezuela, is thought to enable 

continued economic mismanagement and to facilitate corruption 

and standards erosion. 

So I would conclude simply by saying that China is and will continue to be an important economic partner for many countries in 

the region, even as economic growth slows on both sides of the Pacific. Whether China-Latin America relations are, in fact, a win-win 

and mutually beneficial, as China indicates, is debatable. Chinese 

economic engagement has certainly contributed to growth in some 

countries in the region, and Chinese investment could be helpful 

for some Latin American industries or sectors. But mutual benefit 

requires the regions’ governments to negotiate effectively and 

maintain necessary environmental, labor, and other standards. And 

I think that the U.S. has a real role in potentially facilitating these 

developments. 

Thank you very much. 

[The prepared statement of Ms. Myers follows:]

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Mr. DUNCAN. I want to thank all the witnesses for their testimony. That was excellent and kind of a great segue into my line 

of questioning. 

I will now recognize myself for 5 minutes in the first round. 

So I spoke in my opening statement about John Kerry’s words, 

that the end of the Monroe Doctrine was upon us. And we have 

kind of seen a U.S. disengagement in the region. It just doesn’t rest 

with this President; it actually transcends a number of Presidents. 

So do you believe—and I am asking all witnesses—do you believe 

the lack of U.S. leadership and engagement in Latin America and 

the Caribbean and Secretary Kerry’s comment there, the Monroe 

Doctrine is over, has impacted China’s objectives and actions in 

Latin America? 

Dr. Ellis? 

Mr. ELLIS. It is a wonderful and very important question. 

Mr. DUNCAN. Is your microphone on there? 

Mr. ELLIS. A wonderful and very important question, Mr. Chairman. 

I have the opportunity to interact regularly with colleagues in 

China, and I remember at least three colleagues shortly after Secretary Kerry’s speech before the OAS actually called me or emailed 

me saying, did he really mean it? 

Clearly, China looks for signals, and I think that was an important signal that, at the very least, China should not decelerate its 

pursuit of economic and strategic objectives in the region. 

And, certainly, while our Department of State has done some 

very credible and very good work and thinking on the topic, clearly, 

with some of the difficulties with respect to U.S. embassies and 

some of the lack of Presidential-level engagement on this topic, respectfully, I think Latin America has clearly perceived that lack. 

And, in that vacuum, I think, as well, when one takes a look at 

the relative lack of definitions for what the United States has to 

offer the region, that China’s seemingly value-neutral, you know, 

‘‘Take our money, we will help you develop,’’ fills that vacuum. 

Mr. DUNCAN. Yeah. 

Dr. Dussel Peters? 

Mr. DUSSEL PETERS. Yes. I would agree very strongly with you 

that we perceive on the one hand this lack of a U.S. commitment 

and interest in Latin America in general and particularly regarding 

this new triangular relationship, no? 

This is why I proposed at the end that the United States should 

actively participate in these institutions that already exist in Latin 

America, such as CELAC, among others, but that the U.S. should 

also try to create new institutions and to create new knowledge in 

academic, public, and private institutions in the United States. 

We have a lack of interest from the United States, a lack of active participation, and, as I stated in the beginning, a very clear 

long-term strategy from the perspective of the Chinese public sector. 

Mr. DUNCAN. Okay. 

Ms. Joseph-Harris, I am going to ask the question to you little 

bit differently. And let me first say that—a very impressive resume, and I look forward to reading some of your works. 

70

So let me ask you the same question just kind of a different way. 

Do you think if the U.S. was engaged more and looking for trade 

opportunities and reaching out, spending more time focused on this 

hemisphere and working with our neighbors and friends here, do 

you think that would create less of an opportunity for China? 

Ms. JOSEPH-HARRIS. Thank you very much, Chairman. 

Firstly, what escapes us sometimes is that the U.S. does, in fact, 

have a fairly strong trade relationship with the Caribbean and 

Latin America. That is a historic relationship. However, the engagement appears to have weakened immediately after the events 

of 9/11. There was a dropping of the ball, as it were, as America, 

and rightly so, needed to redirect much of its interest to the Middle 

East. And that is the period in which China saw as a strategic opportunity. And there is where many of the inroads have been made 

diplomatically, economically, and culturally. 

However, we have a very strong history of interoperability between our respective militaries, you know, and that is something 

that we should seize upon and consolidate. And one of the things 

that I had said in my original text is that without security and 

good governance there could be no chance of economic sustainability. 

So we need to revisit that strong history of interoperability, continue to properly fortify the CBSI initiatives, and then build from 

there in terms of exploring areas that have been falling off in 

trade, like the CBSI, begin to explore those areas and see how we 

could improve. 

But I am pretty hopeful that it can be done. We have a recent 

change in political administration in Guyana and Trinidad and Tobago recently, and those very countries had been instrumental in 

the early 2000s in bringing together a robust security architecture. 

So we continue to look to the United States and our colleagues 

in the military and the security industries to invigorate those types 

of relationships. 

Thank you, Chairman. 

Mr. DUNCAN. Thank you. 

Ms. Myers, do you think the lack of U.S. engagement opens a 

void? And do you think that China would not have this opportunity 

if the U.S. was more engaged? 

Ms. MYERS. Absolutely. I believe the U.S. disengagement in the 

region has provided considerable space for China and other partners, economic partners, to engage quite a bit over the past few 

years. 

But I think this also has to do with what many Chinese scholars 

are calling diplomatic transformation. And this is not a well-defined concept, but I think the general idea is the development of 

a diplomacy or a diplomatic presence that is consistent now with 

China’s global growing role and the ‘‘one road, one belt’’ strategy, 

as described in this forum, as are new initiatives over the past couple of years, like the China-CELAC forum in Latin America. 

So there is kind of an enhanced interest also in, basically during 

the Xi Jinping administration, in promoting a new form of diplomacy, more or less. 

Mr. DUNCAN. All right. 

71

My time is just about up. I just want to ask Dr. Dussel Peters, 

what do you think about the railroad between Peru and Brazil? 

You know, China is investing this kind of money. You know, with 

the lack of any sort of highways and other ways other than the 

Amazon to move goods and services and people around, the railroad could be a game changer. 

What are your thoughts about that? 

Mr. DUSSEL PETERS. Look, I would say, in general, this proposal 

and this project goes hand-in-hand with what China has been proposing in the last 2 years under this heading, also, of the ‘‘New Silk 

Road,’’ the ‘‘one belt, one road’’ strategy, which means focusing development on infrastructure, no? So there are a group of fundings. 

We have added up more than $150 billion U.S. dollars that China 

has been committing for infrastructure projects, and this project 

could be one of these. 

By the way, you have to be careful also that not all the partners 

of this project have been informed of the project, no? Which means 

this project was launched in Brazil, and other countries such as 

Peru were also informed by the news, no? Usually you would think 

that you would work the other way around, which means you 

would work 2 years and then you inform about this publicly, no? 

Mr. DUNCAN. Right. 

Mr. DUSSEL PETERS. It is not the only project that has been 

launched this way. And there are a group of big projects all over 

Latin America that can change the geo-strategy in this new triangular relationship very profoundly, particularly the Canal of 

Nicaragua that is very close to the United States. 

Mr. DUNCAN. Thank you very much. My time is up. 

We were there in November last year, Congressman Yoho, Congressman Salmon, with Chairman Royce. And just knowing the geography and watching that, it is fascinating to me that they would 

do that. I look forward to talking more about that. 

I recognize the ranking member for 5 minutes. 

Mr. SIRES. Thank you. 

Thank you for your comments. 

Getting back to these projects, you know, you read about these 

projects—$100 billion, $50 billion. How realistic are some of these 

projects? I mean, this canal, how realistic is this, or is this just 

propaganda? 

Ms. Myers, we will start with you. You are shaking your head. 

You don’t think it——

Ms. MYERS. I have strong beliefs about the canal. 

Well, since it was first discussed in 2013, there has been really 

no progress, either in terms of construction or in terms of finance, 

as far as we know. There is a considerable lack of transparency 

surrounding this entire project, so it is difficult to tell. 

The general consensus is that, in order for this to proceed, it 

needs to be funded by a government, and specifically in this case 

China. But there is no clear evidence at this point that China is 

backing this project in particular. In fact, China has tried to distance itself from the Nicaragua Canal, unlike all of these other 

major infrastructure projects that it has proposed throughout the 

region. And these others are big, too, and extremely expensive. 

72

So I don’t see much progress in the coming years. We have seen 

the construction of an access road, a gravel road, some lights. 

There are many, many promises of additional milestones, but they 

tend to never come to pass. 

Mr. SIRES. Dr. Dussel Peters? 

Mr. DUSSEL PETERS. I agree that there has been little progress 

in this project in the last months, but I would take it very seriously, very seriously in terms that, A, it has not been disregarded 

by the Chinese public sector; B, the public sector and the central 

government in China have massive resources for this kind of 

project, as in the case of Brazil, as in other projects in Mexico and 

others, and I can imagine that this might be a concrete bargaining 

coin for the future for some kind of other negotiations, no? 

Thank you. 

Mr. SIRES. Dr. Ellis? 

Mr. ELLIS. I think an important point which you raised by this 

is the fact that perhaps 80 percent of all of the projects that we 

commonly talk about do not ultimately happen, but those 20 percent and also the expectations raised by this are reshaping the region. 

I concur that the Nicaragua Canal project is probably about 6 

months behind schedule and is probably on the point of falling 

apart. We can mention other projects, from investment in Pampa 

de Pongo, the mine in Peru, Rio Blanco, others, the failed Dragon 

Mart project in Mexico, the Mexico City-Queretaro railroad. The 

list goes on and on. 

And the fact is that not only do the Chinese have difficulty in 

engaging with the region, but, for that reason, many of the projects 

fall apart. However, the fact is that the projects that do go 

through—approximately $55 billion in investment to Venezuela, 

about $12 billion to Ecuador—reshapes and keeps alive those 

ALBA countries. 

The net effect on trade relationships is we are moving toward 

what experts call the reprimatization of the region, which actually 

makes them much more vulnerable, the region much more vulnerable, as we see declining commodity demand right now. 

We are seeing a shift in the institutional balance of the region. 

When we say, well, what keeps UNASUR alive, what keeps CELAC 

alive, and why are countries pulling away from the inter-American 

system, the OAS, one has to look at the impulse, the inspiration 

of being able to turn to Chinese markets even if some of those key 

projects are indeed in doubt. 

Mr. SIRES. Thank you. 

Ms. Joseph-Harris, I don’t read about too many projects in the 

Caribbean from the Chinese. What are they doing in the Caribbean? 

Ms. JOSEPH-HARRIS. Thank you so much, because I did have a 

list of very, very specific projects in the region, and I am glad I 

have the opportunity now to elaborate on it. 

Just bear with me. Okay. Here we are. 

In terms of the specific projects——

Mr. SIRES. Still working on it. 

Ms. JOSEPH-HARRIS. I think I have it here. Yeah. 

73

In relation to Jamaica, the Bahamas, Trinidad and Tobago, Grenada, and Barbados, I have made some very, very specific pointers 

identifying where these projects were. 

In the case of Trinidad and Tobago, the Chinese have built a 

children’s hospital. They have built a national arts performing center. 

In the case of Jamaica, they have made huge investments in the 

sphere of what you will call ‘‘investment critical infrastructure 

hoteliering.’’

In the area of the Bahamas, they have also gone into critical infrastructure, port, and hoteliering. 

In Grenada, they have invested considerably in what you will 

call cultural centers and so. 

In Guyana, they have also invested in the bauxite industry, in 

terms of writing off at least nine major loans. 

In Suriname, they have gone into mining. 

And it is a long list. And what I am saying, essentially, is that 

some of these countries, we have to look at the strategic importance. Trinidad and Tobago is a provider of natural gas to the 

United States. In the case of Guyana, you have gold. In the case 

of Suriname, you also have gold. In Jamaica, you have bauxite. 

And this is a materializing of the Chinese quest to go after resources, raw materials, in anticipation of the global looming shortage that is around the bend. 

In addition to which, there are ALBA members, members of the 

Bolivarian Alliance that are also CARICOM, Caribbean community 

members. And as China allies with many of these countries, it may 

be very inadvertently empowering the alliance, which is ideologically adverse to American and Western-style neoliberalism and institutions. 

So one has to look at the Chinese asymmetric approaches, the 

way in which they model their diplomacy. They are trading with 

members of the Caribbean community who are members of the 

Bolivarian Alliance, empowering them, splitting allegiances, and 

thereby tilting the balance in terms of the U.S. influence within the 

region. 

Another very interesting area is in what I would look at as the 

currency wars, asymmetric types of warfare. You may or may not 

be aware, Chairman, that recently, in July of this year, an agreement was signed with the Bahamian Government and the Chinese 

to go into arrangements with trading the renminbi. And the possibilities are that other members of the Caribbean community may 

be able to access trade through that form of currency as distinct 

from trading with the U.S. 

So one has to look at the matrix of indirect relations—currency 

diplomacy, port diplomacy—and the very unique types of modeling 

that the Chinese are using that are by no means normal. And these 

are the areas in which the U.S. influence is gradually being eroded. 

Thank you, Chairman. 

Mr. SIRES. My time is up. Thank you very much. 

Mr. DUNCAN. I thank the ranking member. 

I will now turn to Chairman Salmon for 5 minutes. 

Mr. SALMON. Thank you. 

74

I would like to kind of follow along the same line of questioning 

as the chairman, Chairman Duncan, started, with U.S. involvement, U.S. presence in the region. 

And I am going to turn to you, Dr. Ellis, first. I believe that 

Chairman Duncan is frustrated—I know we have had conversations—that, while the U.S. presence in the region seems to be not 

as strong as it could be, where there has been a vacuum—I think, 

Ms. Myers, you referenced that—and while China’s influence seems 

to be growing in the region, my question is: If we could get a TPP 

agreement, would China’s influence in the region grow, would the 

United States’ influence in the region grow, or would it diminish 

on either side? 

Mr. ELLIS. Thank you very much, Chairman Salmon. I think you 

raise an excellent question. And I, indeed, in my own writings, 

have been a strong advocate of a TPP, but certainly an effective 

and well-negotiated final TPP. 

What I see is for both our Asian partners and our Latin American partners, the question is this emerging importance of the 

trans-Pacific. What are the rules that governs economic interactions? Will it be a Pacific in which the states which are larger 

and better able to coordinate their government and financial and 

commercial institutions can kick open the door, bring away intellectual property, impose their labor laws and workers on others? Or 

is it a rule-of-law Pacific environment in which there is respect for 

labor laws, in which there is respect for intellectual property, in 

which all states have the opportunity to reap the fruit of their hard 

work and good policies, whether Japan or China or otherwise? 

I certainly am a strong advocate of a future TPP which remains 

open to China but one in which we have a prosperous Pacific, in 

which China and the other players play by the rules. And I believe 

that that creates a bigger pie for all parts of the Pacific community. 

Mr. SALMON. Well, in some parts of the Western Hemisphere, 

there still are some serious governance and rule-of-law concerns, 

issues——

Mr. ELLIS. Yes. 

Mr. SALMON [continuing]. Some corruption issues, human rights 

abuses, lack of environmental consciousness, and organized violence in some parts of the Western Hemisphere. 

So is that political and economic climate in the region, is it going 

to hamper China’s ability to be able to function effectively or navigate in the region? Or are they pretty adept at navigating with 

these types of relationships? Could they serve as a model for greater government accountability and respect for the rule of law for 

these countries, or does China perpetuate these problems? 

Mr. ELLIS. An excellent question. 

China is very careful not to impose its own concept of a model 

but very happy to allow others to draw from China the lessons that 

they will. 

What concerns me is, in many ways, there is a new ideological 

struggle that I see of the 21st century, represented to some degree 

by the model of states such as the ALBA states, a very statist concept of how you negotiate with Asia, versus that which is represented by, for example, our partners, the Trans-Pacific Partnership, but, as well, the Alliance of the Pacific. 

75

What concerns me in states like Nicaragua and Ecuador and others, to a certain extent Bolivia, et cetera, is that the opportunity 

to have Chinese money allows populist leaders to do direct relationships, which gets them away from accountability and oversight as 

previously imposed by institutions such as the Inter-American Development Bank, et cetera. 

And, in many ways, the reason why China has loaned so much to Venezuela, over $55 billion, but has had very little success in the 

projects that they have pursued very hard in countries like Mexico 

and Colombia and elsewhere is that those countries have established laws and institutions and strong bureaucracies and are less 

willing to bend to the Chinese rules, whereas countries such as 

Venezuela have been more willing to do state-to-state deals. 

And, at the end of the day, that disadvantages not only Western 

businesses but, I believe, disadvantages the rule of law in the region. It encourages corruption and bad governance. And, really, it 

prejudices the people of the region and their long-term democratic 

interests and development, I believe. 

Mr. SALMON. I am going to paraphrase then. What I am hearing 

you saying is that if the United States isn’t deeply engaged through 

activities like TPP, if we are not leaders in the region, then there 

is a vacuum that is filled by others. 

Is that something others on the panel would agree with? That if 

we are not actively engaged in determining what the rules of the 

road are for engagement in the Western Hemisphere, if we are not 

the leader through things like TPP, then countries like China have 

greater authority to dictate those rules of the road? Is that—it 

looks like most of you agree with that. 

The other question I wanted to ask is, with some of the economic 

woes that are happening in China domestically, is that going to impact their ability to be able to interact in the region, with the financial crisis that they have been going through? 

Do you think, Ms. Myers, that is going to impact their ability to 

be able to complete the agenda? 

Ms. MYERS. Certainly, we have already seen a pretty remarkable 

decrease in trade with Latin America, especially in South America, 

commodities trade over the past year, in particular, but also before 

that. Also, turbulence in Chinese markets and the Shanghai Stock 

Exchange and then the recent devaluation of the yuan has had effect on global markets, obviously, and then so also has affected 

Latin America quite considerably and, especially, again, commodities exporters—Chile, Peru, and others. 

And so, in the short term, yes, there is a considerable effect on 

Latin America, and this is troubling to many. 

In the medium to long term, I think—well, in the medium term, 

at least, we will see considerably more demand still for Chinese 

goods, for Chinese commodities—or, I am sorry, for Latin American 

commodities, in particular, and for Chinese goods in Latin America. These things aren’t going to change immediately. Growth has 

slowed in trade, but it is still growing. 

And China very much is looking not only to Latin America but 

to other regions for raw materials, of course, but also to help it facilitate its reform process. So many of these investments promote, 

for example, economic upgrading, which is a major element of reVerDate 0ct 09 2002 13:32 Oct 27, 2015 Jkt 000000 PO 00000 Frm 00081 Fmt 6633 Sfmt 6633 F:\WORK\_WH\091015\96051 SHIRL
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form, or the use of excess steel in China, and that is a major problem in the domestic Chinese economy. 

So we will see more, absolutely. 

Mr. DUNCAN. Thank you, Chairman. 

We will now go down to Mr. Rohrbacher from California. 

Mr. ROHRABACHER. Thank you very much. 

When we are discussing China and its influences, this is not just 

a situation where the United States wants to dominate the world 

and we want to make sure that people are listening to rock and roll 

instead of Chinese instruments playing their style of music. 

I just note that in China there has been no political reform whatsoever. Although we had a promise that if we increased our economic ties to China, increased our investment, increased our involvement, that there would be a liberalization of their system. 

And there is no opposition party, opposition press. There are no 

people who are permitted to openly organize and criticize the government. 

China has also, at the same time that it has no political reform, 

has become ever more aggressive in its many territorial claims, territorial claims which we have ignored for a long time, but now they 

seem to be reemerging. Plus, you have military action taken by 

China over dubious claims in the South China Sea. 

So as we are discussing the issue of China’s influence, it is not 

just another country versus our country as our influence. It is 

whether or not this totalitarian power will be expanding its area 

of influence, but in some ways control. 

And let me also note this. Years ago there was—I first noted this 

when—and the Chinese targets and how they handle it economically—when the Panama Canal, as it exists today, a Chinese company was able to buy—Hutchison Whampoa was able to buy terminals on both sides of the canal, thus putting the Panama Canal in 

a position of being dominated by this Chinese-owned company, and 

how that company received that contract after the actual Panamanian Government had been notified, an American company, that 

they had won the contract, and they were there to accept the contract. In the middle of the conversation, a phone call comes in. And 

I think it was the Vice President had to leave the office. And when 

he came back, he said: Oh, there was a mistake made. The contract 

went to somebody else. 

And the question, what I am leading into is, it was always my 

belief that somebody had been paid off. In the United States, we 

put our people in jail if they make bribes to foreign leaders. Is 

there any such rule of thumb for the way the Chinese companies 

deal with these Third World countries that we are talking about 

and developing countries? 

Mr. ELLIS. Well, certainly China does have rules. However, its 

understanding of how those rules restrain it and the degree to 

which it enforces those rules, especially with respect to companies 

overseas, is a gray area. Indeed, many fear that one of the sources 

of a reduction in Chinese foreign overseas investment may be that 

the crackdown on SOE heads in China itself may make China’s 

leaders reluctant to pursue deals which would lead to their personal enrichment in places in Latin America. 

77

But certainly the deeper question that you raise is a very important one, and that is that to the extent that you do not have an 

analog of the Foreign Corrupt Practices Act, those type of deals increase corruption in the region at two levels. 

Mr. ROHRABACHER. When you come from a society that doesn’t 

have a rule of law, doesn’t have an independent judiciary, doesn’t 

have stated rights in terms of people’s relationship with legal procedures and who owns what property, et cetera, you would expect 

that in that country there would be some major problems in dealing with the citizens and companies from that country. 

Let me ask you this about those companies that are dealing with 

these nations that we are talking about. Many of the companies in 

China that are making profits, et cetera, are actually companies 

that are owned by the People’s Liberation Army. Are any of the 

companies that you are talking about owned by the People’s Liberation Army? 

Mr. ELLIS. Probably one of the best examples that comes up—

and of course ownership is a difficult concept. We talked about the 

Nicaragua Canal. And when we take a look at the mysterious Mr. 

Wang Jing, although he is basically a defense contractor in the 

Chinese parlance, the offices that he has in the region and Hong 

Kong are filled with, you know, patriotic paraphernalia, however, 

when one actually looks at his primary company, a telecommunications company called Xinwei, which is involved in building a system-of-systems type of infrastructure for the PLA, the way that he 

got to be a very young 47-something-year-old billionaire is because 

he made a leveraged buyout to this company and then miraculously 

that company began getting billions of dollars of contracts from the 

PLA. 

And so certainly aside from Hutchison and your very good point 

about Hutchison’s relation—and Hutchison, of course, was just recently bought by a mainland Chinese company—but I think one of 

the things that worries me about Wang Jing is the fact that those 

ties through Xinwei indicate that certainly there are certainly interests. If there are commercial interests, there are interests behind those interests. And I think, you know, that that needs to be 

a concern as we look at the nature of the relationship in the future. 

Mr. ROHRABACHER. Anybody on the People’s Liberation Army? 

Ms. MYERS. I just wanted to add that Wang Jing’s company, 

Xinwei, just declared bankruptcy. So it kind of bodes poorly, I 

think, for the canal operation as well, considering that he is funding much of the first sort of elements of that. 

Mr. DUSSEL PETERS. In our experience, the public sector in China 

is omnipresent in qualitative terms. It is not sufficient to go very 

concretely regarding one public institution, but you have the central government, you have cities, you have municipalities, and the 

mixture of these governments, the public sector. 

To have an idea, more than 86 percent of Chinese FDI, according 

to the work we have been doing from 2000 to 2013, has been pursued 86 percent by the Chinese public sector. So there is an omnipresent public sector participating in FDI. 

And I would briefly relate to the question that was posed regarding TPP by the chairman and Mr. Salmon. I think TPP is not sufficient as a Latin American strategy. TPP is dividing Latin America, 

78

a group of Latin American countries are not geographically related 

to the Pacific. And I would highlight how important it would be to 

modernize, to rediscuss, for example, a topic such as NAFTA, 

which has been completely left aside. I would very strongly propose 

to upgrade, to modernize——

Mr. DUNCAN. In the essence of time, I am going to need you to 

wrap up. Try to respect the other members’ time. I know Ms. Joseph-Harris wants to respond. 

If you could do it briefly. This gentleman has somewhere else to 

go and I want to try to get to him. So, Ms. Joseph-Harris, if you 

will just respond briefly. 

Ms. JOSEPH-HARRIS. Thank you. I will get to the crux of it. 

What we are looking at, Chairman, is that we are in an ideological war. The member is quite correct, it is ideological. And I would 

even go so far as to say that the whole idea, the whole notion of 

a China-U.S. dynamic is ideologically based. And I would cite what 

I mean by it. 

America’s ideological apparatus, represented by its globally dispersed network of central banks, international monetary system, 

multilateral corporations, vis—vis a Chinese facade, where you 

have no democracy, no rule of law, that brings us in what you call 

a juxtaposition, it is an ideological face-off. 

This is what we are looking at, and that whatever we are looking 

at ties back to ideas and ideology. And what makes the Caribbean, 

in particular, vulnerable is the fact that we lack that strong ideological base, save and except for the institutional formidability of 

the OAS, which is the only strong and true multilateral forum. And 

that is where we need to look at the institution within the Americas as a countervailing effect against China. 

Thank you, Chairman. 

Mr. DUNCAN. Great points. 

Mr. Yoho. 

Mr. YOHO. Mr. Chairman, I appreciate it. 

I appreciate you all being here today. 

And it is disheartening to see that we are losing our influence 

with our closest allies, our closest countries, and that China is 

kicking our rear end again. 

And I wanted to ask you, before I ask any questions, Dr. Dussel 

Peters, I am glad to hear you say that the TPP really wouldn’t help 

the area. It would be us negotiating a strong trade agreement with 

all of Latin America. And you would agree with that? 

Mr. DUSSEL PETERS. Yes, very strongly. 

Mr. YOHO. Okay. 

And then the other thing is what I see as a stale relationship, 

it is like a relationship between people, the United States and 

Latin America, it has become stale. We need to revitalize that. And 

from what I have heard from you, it is from a lack of engagement. 

And I know after 9/11 there was a cause for that, but we need to 

move on. And we need to reinvest in our closest allies before other 

people. 

And I think we need to restate the Monroe Doctrine. I think that 

is something that we need to stand for what the Western Hemisphere stands for. Because what we have seen over the course of 

the last 20 years is a slip or a slide into socialism. They are lining 

79

up with Iran. They are lining up with Russia and China. And we 

are losing that influence. 

And what I wanted to ask you is, why is that, and what has 

caused that? Is it because America, our country, meddles too much 

in telling other countries how to live, the kind of rule of law they 

should have, and our ideologies? And I know China doesn’t do that 

as much. They kind of just go with the flow and invest in the infrastructures. 

What are your thoughts on that, Dr. Ellis? Are we meddling too 

much in telling people how to live? 

Mr. ELLIS. I think that to some degree the right kind of meddling 

is useful. One of the dilemmas that China finds itself in right now, 

for example, with the change in government in Guyana, the new, 

very effective government of Dr. David Granger, China suddenly 

finds that the dirty deals that it makes with one government, when 

it is replaced by another government, it now finds problems. It 

faces the same dilemma——

Mr. YOHO. I am glad they find that. 

Mr. ELLIS. But I think also, with all respect, one of the things 

that I believe that we need more of—and it is ironic because it is 

a point that is made I think very effectively in the most recent defense and diplomacy review document that the State Department 

has put out—is value-based leadership. 

In my respective judgment, what we have done—what we have 

not done sufficiently is explain why the U.S. concept of rule of law 

and free markets in democracy will bring broad-based development 

and why it is the best deal, why going with the easy deal with the 

Chinese money does not bring sustainable development, why going 

with particularistic negotiations between a leader and a Chinese 

company is not the best way to bring value added in the company 

involved. And I don’t think that we do that effectively enough in 

explaining our case to the region. 

Mr. YOHO. And I am glad you brought that up because what I 

have seen in other countries, especially in Africa and some of the 

other countries, China puts money into there, but then they suck 

the resources off and they leave. You are not getting a Chinese 

company. You are getting the Chinese government, their military, 

their secret service, and all that in one. It is not a Chinese company. I mean, it is a facade. We have seen that over and over again 

and we know that for a fact. 

But I have to give them credit. They are making headway. They 

go in there and they get the trace minerals, the rare earth minerals, and they are smart at doing that. And we need to tighten 

up our strategy and our foreign policy. 

Let me ask you, does the OAS, are they courting the Chinese? 

Are they shunning us, Ms. Joseph-Harris? 

Ms. JOSEPH-HARRIS. Member Yoho, I really, really welcome this 

part of the discussion. I would like to tag onto what my colleagues 

said. 

Mr. YOHO. Yeah, sure. You have got a minute and 18 seconds. 

Ms. JOSEPH-HARRIS. We do, in fact, have a very robust interAmerican institutional system under the OAS, and it is very open, 

sort of poised, positioned to do exactly that, sell the inter-American 

ideal to the community. And I think there is where we probably 

80

dropped the ball and we need to focus there on rebuilding that 

past. Thank you. 

Mr. YOHO. Ms. Myers, do you have anything you want to add 

into that? Did I catch you off guard? 

Ms. MYERS. Not on the OAS. But I would say that, I mean, at 

the very least, there was a Pew study, a Pew Research study that 

was done a couple of years ago on perceptions of China and the 

U.S. In Latin America. And it was very clear that the perceptions 

of the U.S. are still extremely strong. China is rising in certain respects. But we have a very strong relationship with Latin America 

and there is much to build on in that respect. 

But, yes, in terms of finance, no-conditions finance is very appealing to many countries in the region. And for that reason, not 

only in terms of investment, but also in finance, there have been 

cases when Chinese companies and banks have won out over American companies and banks, and that is problematic. 

Mr. YOHO. I appreciate everybody’s answers. 

Mr. Chairman, thank you for the opportunity. 

Mr. DUNCAN. I want to thank the gentleman for staying around. 

I know you have got other places to be. 

We will go to Mr. Smith from New Jersey. 

Mr. SMITH. Chairman Duncan, thank you very much for the 

hearing, as well as for my good friend Matt Salmon, and, of course, 

Albio Sires. This is a very important subject, and I thank you for 

bringing some light and scrutiny to it. 

A similar type of Chinese hegemony is actually occurring in Africa as well. I chair the Africa Committee. And I am very concerned, 

you know, sometimes, what is China’s interest in Latin America, 

we also have to ask what is Latin America’s interest in China? Increasingly for despotic regimes in places like Sudan, it is Bashir 

who greatly cherishes his relationship with Beijing. And, of course, 

Evo Morales and so many others, the FMLN in El Salvador, increasingly. 

My first trip to Latin America was three times during the FMLN 

wars and saw upfront and close the terrible devastation. But who 

was providing those funds? It was all coming from the Soviet 

Union, usually by way of Cuba, and violence was being used for political means. 

Now China is stepping into that void with the demise of the Soviet Union, and they are doing it all over the world. The bad governance model, as you know, is being very aggressively promoted. 

I was in Bolivia twice in the last couple of years working on behalf of an American who was being held captive in Palmasola prison. Went to the prison. No charges were brought against him. 

Eighteen months in that hellhole. And Evo Morales and his government, and I while there became even more sensitized to it, just 

loved Tehran and just loved China because it is a source of legitimacy, for money, and trade. 

So my concerns are, you know, we will have Xi Jinping coming 

to the United States and visiting with President Obama in just a 

few weeks, very, very shortly. I am doing a hearing before he comes 

on China’s race to the bottom with North Korea on human rights 

abuses. They have gotten far worse. Name the issue, trafficking, 

torture, the crackdown on religious belief. And then you see that 

81

they are having additional and enhanced influence in the Caribbean, as well as in the rest of Central and South America. A very, 

very disturbing trend because dictatorships, whether it be in Venezuela or elsewhere, thrive on that kind of cooperation with a dictatorship like China. 

So my first question or big question is, what is Latin America’s 

interest? Why are these, these guerilla movements now turned, you 

know, whether it be FMLN or the FSLN in Nicaragua, finding such 

a friend in Beijing? Twelve countries in Central and South America 

and the Caribbean still support the Republic of China on Taiwan. 

Is there pressure being put on them to sever those ties or downgrade that recognition? 

And, again, when it comes to providing arms, from AK-47s to everything else, when it comes to using the Internet to surveil dissidents and people who espouse real democracy, what is China’s influence there? Because they have literally written the book on how 

to find good people, dissidents and others, track them down, and 

throw them into prison. 

Mr. ELLIS. I think they are very good questions. China’s interest, 

in my judgment—I am sorry, Latin America’s interest—ranges 

from the legitimate and the commercial to the less legitimate. I 

think it is reasonable for many Latin American businessmen and 

leaders to see opportunities in Chinese markets, to see opportunities in attracting Chinese investment, to see new possibilities for 

funding sources. 

Not all of those interests are illegitimate. However, it is a spectrum. Because as we move into other types of things, the opportunity of a Hugo Chavez and now Nicolas Maduro to be able to escape good financial oversight and democratic institutions and 

things like that because he can get the quick Chinese loan or now 

the $10 billion in new Chinese loans in the runup to the December 

6 congressional elections in Venezuela. 

And it goes into the personal as well. One takes a look at one 

of the sons of Daniel Ortega, Laureno Ortega, who was instrumental in putting together the Nicaragua Canal deal, as well as 

the telecom financing deal in Nicaragua with Xinwei. 

And the fact is that the Chinese deal, in part because of the lack 

of oversight, provide both personal enrichment opportunities, as 

well as opportunities for leaders who don’t want to have to adhere 

to the types of values that the United States is promoting, democracy, labor rights, free markets, transparency, to be able to get 

away from that. 

But only get away from that for a time because ultimately it 

leads to a greater collapse, because of the economic contradictions, 

because of the poor governance. But when that collapse comes, it 

prejudices us because it is we in this hemisphere who are geographically, physically, economically, and by ties of family related 

to the hemisphere, whereas the consequences are much more indirect in terms of what happens when those deals go bad for China. 

Mr. SMITH. I yield back my time. 

Mr. DUNCAN. I thank the gentleman from New Jersey. 

We will go to Mr. Chabot from Ohio. 

Mr. CHABOT. Thank you very much, Mr. Chairman. 

82

I will ask probably just one question here unless I have a followup. And I will address it to the whole panel to the extent you would 

like to answer it. 

My question is in regards to China’s objectives with respect to 

Taiwan and Tibet. In your opinion, is China strengthening its diplomatic relations with countries in the Western Hemisphere at 

least partly in an effort to isolate Taiwan and to some degree Tibet 

or a free Tibet some day? If yes, how successful have they been so 

far? And specifically what are the benefits that China offers to 

Latin American countries in exchange for their support in this effort to isolate especially Taiwan, but also to some degree Tibet? 

Whoever wants to take it first. 

Ms. Joseph-Harris. 

Ms. JOSEPH-HARRIS. Member Chabot, thank you very much. In 

the case of the Caribbean, it has been a rather interesting scenario. 

Within the CARICOM community, which is a 15-member coalition, 

we have a situation where there is an absence of what is called an 

Asian policy. And the Chinese have been very, very successful in 

penetrating that absence of policy by literally purchasing diplomatic relations in terms of inducing countries to split their allegiance and remove their relationship with Taiwan in favor of Beijing. 

And the inducements have been large sums of money, donations, 

and cash. Less than diplomatic, one would say, but they have been 

extremely successful in it. So that, currently, there are, I would 

say, there are still four countries out of CARICOM left, and the 

Chinese are very aggressive in terms of getting them to withdraw 

that allegiance with Taiwan. So I would say that they have been 

very good at it thus far. 

Mr. CHABOT. Thank you very much. 

Yes, Dr. Peters. 

Mr. DUSSEL PETERS. We have been working in the last years on 

the Central American countries and their relationship with China, 

and it has been very interesting how as a result of the improvement in the relationship between Taiwan and China, China has 

been extremely pragmatic regarding the issue of this diplomatic relationship and recognition, which means that China has been able 

to accept delegations from countries without a diplomatic relationship. They have been doing turnkey investments, trade, and a big 

group and an interesting dialogue, political dialogue also. 

And I would tell you finally that in the region China has also increasingly stated that while it has offered a group of projects to 

Costa Rica who broke these relationships in the region, this will 

not happen again in the region. Also, again, this pragmatism even 

in the diplomatic arena is very important. 

Mr. CHABOT. Thank you. 

Dr. Ellis. 

Mr. ELLIS. Yes. As you know, in 2008, then newly elected Taiwanese President Ma Ying-jeou formed an informal agreement 

with then Chinese President Hu Jintao to basically suspend this 

politics of the checkbook. 

What has happened in general is that they have honored that relationship. But I also look toward the importance of the future. In 

other words, in that time since 2008, just about every Central 

83

American and Caribbean president who has recognized Taiwan has 

expressed an interest in changing. We saw it with President Lugo, 

then president of Paraguay. We saw it with President Funes in El 

Salvador. We saw it with President Zelaya and later President 

Lobo in Honduras. We saw it with President Martinelli in Panama, 

et cetera, et cetera. 

The Chinese have said no. But the way I look at it is that they 

have prioritized the resolution of their dispute between brothers 

over any short-term gains that they could get from Central America and the Caribbean. In that sense, I think it has been a lesson 

for where their priorities actually lie. 

But what concerns me about that is that if that truce ever breaks 

down, it is very clear that China has been advancing its commercial engagement offices of CPIET, et cetera, so that if China decided to start accepting that interest in changing, very, very rapidly Taiwan would find itself without diplomatic recognition and in 

a grave situation diplomatically in the region. 

Ms. CHABOT. Thank you, Doctor. 

Ms. Myers, I have a little time left. 

Ms. MYERS. Sure, just very briefly. I mean, there is a possibility 

that Tsai Ing-wen, the new candidate who is part of the DPP party, 

could win the next election. And, of course, she and her party are 

more supportive of Taiwanese independence than the KMT. 

If that were the case, then we could see a sort of reemergence, 

there has been a diplomatic truce so far, but we could see a lot 

more competition between China and Taiwan in the region, especially in Central America and the Caribbean. I am not sure how 

that would play out, but there is a good possibility there. 

And then just on the Dalai Lama, you see both sort of direct opposition to Dalai Lama visits, for example, and indirect. For example, you have a Confucius Institute in your university and you are 

receiving a lot of funding from China for that Confucius Institute, 

are you going to invite the Dalai Lama even though you might 

want to? Maybe not, because it certainly risks complete removal of 

all of that funding. 

So you see certainly that sort of influence happening very, very 

indirect, very sort of under the table. But it is happening. 

Mr. CHABOT. Thank you very much. 

Thank you, Mr. Chairman. 

Mr. DUNCAN. I want to thank the gentleman from Ohio. Great 

questions. 

The Chair will now go to Mr. Sires from New Jersey for I think 

the final round of questions here. 

Mr. SIRES. I have two observations. One of the observations that 

I have is that one of the reasons that our two regions are so tied 

together is the fact that this is a region where they have had many 

revolutions and the only country that really has opened their doors 

to all those people over the years has been this country. So it has 

developed an umbilical cord type of relationship that I think for 

China is going to be very difficult to break. I don’t know if you 

agree with that or not. 

And the other observation that I have is the OAS, Ms. JosephHarris, I disagree with you. I think it is completely ineffective. I 

think it is an organization that doesn’t speak up enough on the 

84

abuses in this region. And if you are there to represent these countries, you are just too influenced by some of these countries not to 

speak up on the abuses that are going on. I mean, I haven’t seen 

the OAS talk about Venezuela and the abuses of Venezuela at all. 

So when you tell me that you have an institution that could be a 

vehicle, I am sorry, I really don’t see it as a vehicle. Not to mention 

the abuses in China, but, you know. 

Ms. JOSEPH-HARRIS. I agree with you on the ineffectiveness of 

the OAS. I don’t want to be misunderstood. But I am saying that 

there is an institutional framework. It needs to be empowered. It 

needs to be made effective. I am familiar with the framework because years ago I have been part of experts teams. But I am agreeing with you that a lot needs to be done in order to empower the 

OAS so that it can be effective. Thank you. 

Mr. DUSSEL PETERS. I believe that, in fact, CELAC has been very 

successful in this dialogue with China. And I believe it would be 

very relevant for the United States to participate in CELAC. For 

whatever reason, OAS has not been active in this area. 

Mr. ELLIS. Mr. Sires, I think you raise a very, very important 

question. Thank you for the opportunity. 

To me, I agree with you that the OAS has deep, deep difficulties. 

When I look at this from a strategic perspective, though, I ask myself, is it in the interest of the United States to try to empower a 

debilitated institution or to let it die or be ineffective. 

And when I look at the alternatives, it worries me. For example, 

China chose to engage with CELAC, which excludes the United 

States. Other states in the region, one could say Brazil, have interests in the empowerment of UNASUR to fight the region’s interests 

as opposed to the OAS. 

But if the OAS remained ineffective, we, in my judgment, do not 

have an effective vehicle. China was an observer member of the 

OAS since 2004, but they chose to work through CELAC. Our Colombian friends came asking for help from the OAS to resolve. To 

me, if we allow the OAS to be ineffective, and that goes down to 

leadership on our part, then we prejudice ourselves respectively 

strategically in the hemisphere. That is my respectful opinion. 

Mr. SIRES. Ms. Myers, what do you think? 

Ms. MYERS. We are hosting a meeting with the OAS today, and 

they have done a fantastic job of helping us out. 

But, no, I mean, I would actually agree with Enrique that U.S. 

participation in some form in CELAC—I mean, it was the brain 

child of Hugo Chavez and so it almost intentionally did not include 

the U.S. and Canada. But I think at least in the initial observer 

capacity, whereby, you know, facilitating in some form some of the 

technical cooperation that has been proposed could be a good thing. 

The OAS, obviously there is much to do there to improve its 

function. But I agree that it is also a useful organization to the extent that it can be more effective in the region. 

Mr. SIRES. Mr. Chairman, thank you very much. 

And thank you very much. 

Mr. DUNCAN. I want to take this opportunity to thank the witnesses. I thought this was an excellent discussion. I don’t know 

that we have solved any problems, but I don’t know if that was the 

goal. But I learned a lot. And I think this dialogue about U.S. enVerDate 0ct 09 2002 13:32 Oct 27, 2015 Jkt 000000 PO 00000 Frm 00090 Fmt 6633 Sfmt 6633 F:\WORK\_WH\091015\96051 SHIRL
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gagement and opportunities to allow others to get a foothold in our 

hemisphere is so critical. 

And so I want to thank you. And I look forward to continuing 

this dialogue. I look forward to reading some of your material as 

well. 

So pursuant to Rule 7, the members of the subcommittee will be 

permitted to submit written statements to be included in the official hearing record. 

Without objection, the hearing record will remain open for 5 business days to allow statements, questions, and extraneous materials 

for the record, subject to the length limitation of the rules. 

There being no further business for the committee, we will stand 

adjourned. Thanks so much. 

[Whereupon, at 3:40 p.m., the subcommittees were adjourned.] 

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