The news surprised Guatemalan exporters: local media reported that China had banned the import of Guatemalan coffee and other products. There was no official explanation, but Guatemalan President Bernardo Arévalo speculated that it might have something to do with his country’s relations with Taiwan. “We’ll take care of it,” he said.
Along with Paraguay, Guatemala is the only Latin American country that has diplomatic relations with Taiwan. Beijing views the island state as part of China. In recent years, Honduras and Nicaragua have changed their stance, moving away from Taiwan and toward China.
China: many small conflicts in Latin America
The blockade of Guatemalan products is one of many small conflicts that are beginning to overshadow China’s long path of growth and expansion in Latin America.
However, the conflicts are of a different nature, says Vladimir Rouvinski, from the Department of Political Studies at the Icesi University of Colombia, in an interview with DW. “In this case, it is clearly a means of pressure that China is using. Not so much against Guatemala, but rather against Taiwan.”
In Costa Rica, the government pressured a manager at state energy company ICE to leave the company because around 70 high-level employees attended a party hosted by Chinese tech giant Huawei.
The unionists reacted horrified. The president of ICE, Marco Acuña, asked for greater sensitivity to the “contract award procedures and some legal disputes” that were developing at the same time. The behavior of the affected employees could damage “the image of the institution and our reputation.”
A “message to China” from the president of Costa Rica
Relations between Costa Rica and Huawei have become strained after President Rodrigo Chaves made the Budapest Convention to Combat Cybercrime, which China has not signed, the standard for economic engagement in Costa Rica. The head of Huawei in Latin America later criticized these actions by Costa Rica as “unprofessional.”
For political scientist Rouvinski, Chávez’s actions are “a message to Beijing that China must also respect the rules of the game.”
The Budapest Convention is the first international convention on crimes committed via the Internet. Areas of interest include copyright infringement, computer fraud, and network security violations.
There are other examples of economic conflicts between China and Latin American countries. This includes anger over cheap steel from China, which is putting Latin American producers under enormous pressure. In Brazil, fashion clothing stores see their existence threatened by cheap textiles from China. Accusations that Chinese companies harm the environment with their production also spark debate.
Brazil imposes tariffs on imports from China
Brazil is now defending itself against cheap imports from China with a 20 percent tax. This applies to orders valued at less than US$50, which are placed through international websites. According to Brazilian media, the Chinese online giant AliExpress was “surprised” by the decision. The tax will particularly affect the poorest and will deter foreign investment in the country, it warned.
In the textile sector there is great anger towards Chinese suppliers because corporations like Shein, which can produce under different conditions than small Brazilian companies, are already expelling thousands of local companies from the market. At a popular level, there is a growing impression that China’s strategy is destroying local business structures rather than allowing them to benefit from them.
Who benefits from economic relations between Latin America and China?
“Lately, the challenges and risks associated with China’s rise as a dominant player in many economic and technological areas have become increasingly clear in Latin America,” Latin America expert Christian Hauser of the University of Applied Sciences of Graubünden, Switzerland.
In addition, there is a foreign policy component: “Latin American countries are increasingly caught up in the geopolitical rivalry between the United States and China,” says this expert. “In this context, current tensions between some Central American countries such as Guatemala, Costa Rica and China are probably just the beginning of more conflictive relations in the future.”
Only with Nicaragua does China’s relationship seem intact. The authoritarian government has banned numerous non-governmental organizations, including many that were actively working to protect the environment. Media outlets in Nicaragua critical of the government report that Chinese companies have received 13 licenses for mining projects there in just over six months.
(rml/cp)
