VOXXI: China reinforces trade with Latin America and the Caribbean at CELAC

China reinforces Trade with Latin America and the Caribbean at CELAC
W. Alejandro Sanchez
VOXXI
January 31, 2014

The two-day summit of the Community of Latin American and Caribbean States (CELAC)  came to a conclusion this week without any dramatic changes in Latin American and Caribbean geopolitics, but a new incoming strong political and business player was established: China.

The high-level meeting took place in Cuba, and reunited leaders and delegations from the groups’ 33 sovereign member states.

The Cuban government can pat itself on the back for having organized an incident-free conference, in which the attending leaders gave predictable speeches regarding the “American empire” and called for regional integration.

Nevertheless, a skeptic can easily argue that, for all the photo shoots, speeches, and meetings, the summit will not dramatically alter the near future of the Latin American and Caribbean geopolitics.

CELAC approaching China

One important outcome of the summit was that the final declaration announced the formation of a forum, which will strengthen relations between CELAC and China.  This is an interesting development, which warrants further discussion.

First of all, it makes sense that CELAC would want to approach this extra-hemispheric relationship. Besides integration among its members, a primary objective of CELAC is to decrease U.S. influence in Latin America and the Caribbean.

Hence, by approaching the Asian powerhouse, CELAC nations can increase commercial and diplomatic ties with Beijing, which could in turn decrease the dependency of some Western Hemisphere governments on the U.S.

Secondly, China already has growing diplomatic and commercial relations in the Western Hemisphere, and some nations in particular are keen on strengthening such ties. Venezuela is one prominent example as Chinese oil companies have heavily invested in Venezuelan oil, the cornerstone of the country’s economy.

Meanwhile, Nicaragua gained international prominence in 2013 when the Daniel Ortega government signed an agreement with an obscure Chinese industrialist to build an inter-oceanic canal that (if it’s ever built) will rival Panama’s.

Moreover, even countries that are close allies of Washington are now approaching China for commercial opportunities.

In a January 20 commentary for VOXXI, I highlighted how Mexican President, Enrique Peña Nieto, traveled to China in April 2013, while Chinese President Xi Jinping returned the visit in June of the same year. Moreover, while in the Western Hemisphere last year, the Chinese leader also traveled to Costa Rica and Trinidad & Tobago, a Caribbean state that has significant deposits of oil and natural gas.

Certainly, China is everywhere these days, from Chinese companies constructing Baha Mar, a multi-billion dollar tourism complex in the Bahamas, to investing in Argentina (Beijing is now reportedly Buenos Aires’ second-largest trading partner).

Hence, an issue to keep in mind is: If CELAC members aim to improve multilateral relations with China, then what about Taiwan?

Most of the nations that still have diplomatic ties with the island are in the developing world, particularly in Central America and the Caribbean.

Increased ties between Beijing and CELAC could mean that Taipei is in danger of losing its remaining allies in the Western Hemisphere. Certainly, this is a concern for Taiwan as it has recently lost allies elsewhere (i.e. Gambia this past November 2013).

Diplomatic Predictability

As for the rest of the CELAC summit, most statements and speeches were fairly anticipated and unsurprising.

For example, the final resolution praised the late Hugo Chavez; in the text, he is described as a “tireless humanist … who fought against social exclusion [and] poverty.”

Likewise, the group stated that it supports Argentina regarding its claim on the Malvinas /Falklands Islands.

Nevertheless, realistically there is little chance that CELAC’s backing of Buenos Aires will convince London to cede control of the islands any more than the March 2013 Falklands Referendum could have possibly convinced the Argentine government that the (non-indigenous) inhabitants of the islands do not want to live under Argentina’s rule.

In any case, it is likely that the aforementioned resolution was well received by President Cristina Fernandez de Kirchner, who attended the summit.

As a final point, it should be stressed that Latin American and Caribbean nations are looking at Cuba for commercial partnership and investment opportunities.

During her visit to the Caribbean, Brazil’s President Dilma Rousseff and Cuba’s President Raul Castro inaugurated the first phase of the upgrade of a port in Mariel, west of Havana, financed by Brazil.

Similarly, a January 30 Reuters article explains, “foreign ministers from the EU’s 28 countries will give the go-ahead on February 10 to launch talks with Havana on a special cooperation accord to increase trade, investment and dialogue on human rights. The pact could be agreed by the end of 2015.”

In other words, the European Union also wants to increase ties with the island.

Meanwhile, President Barack Obama did not mention Cuba or Latin America in his State of the Union, though he did pledge, again, to close the detention center in Guantanamo.

While there have been some interesting developments to improve relations between Washington and Cuba, it is unlikely that they will dramatically improve in the near future.

As for CELAC, Costa Rica is now the new pro tempore president of the organization. We will have to wait and see what the Central American nation and its rising international image can do, if anything, to continue the effort of uniting CELAC’s 33 member states.