The News
Mexico would take Washington’s side in potential trade battles with Beijing, its economy minister said this week.
Both China and the US have ratcheted up their push for wider influence across Latin America in recent years, including by deploying massive investment programs.
Brazil, the region’s biggest economy, now appears on the verge of joining Beijing’s Belt and Road Initiative, attracted by the potential economic gains, Dialogue Earth reported.
US officials are afraid that some of the Chinese infrastructure could be leveraged for military uses. “I really believe that economic security and national security go hand in hand here… and we have got to work both of them together very, very quickly,” the head of the US Southern Command said in July.
SIGNALS
Mexico wants to cut down on Chinese imports
Mexico wants to reduce its dependence on Chinese imports, and has requested that US companies identify parts and products that could be manufactured in Mexico, the Wall Street Journal reported. The efforts reflect Mexico’s view that the country is “facing a trade war between the US and China,” as a government presentation obtained by the Journal put it. Mexico’s economy minister said one of his key missions will be to “accelerate nearshoring, to take advantage of it one thousand percent,” bringing production from Asia to Mexico. Efforts to reduce the US’ reliance on Chinese industry have already benefited Mexico, with the Latin American country surpassing China to become the leading exporter of goods to the US last year.
China has expanded its presence in Latin America
China has ramped up its economic and diplomatic presence across the Western hemisphere over the past 20 years, becoming the biggest trade partner for South America and building out infrastructure through its Belt and Road Initiative. Although Beijing views its inroads in Latin America in the context of its strategic competition with the US, it “assiduously paints its involvement in the region as unrelated to these concerns or in any way aimed at Washington,” one analyst noted, minimizing geopolitical strife in the region. While Latin American countries largely do not wish to take a side in the superpower rivalry, China is slowly acquiring tools for applying “subtle pressure,” The Economist reported.
Washington continues to overlook Latin America
Despite Latin America’s vicinity, its abundance of critical minerals, and its economically competitive workforce, Washington has largely overlooked opportunities in the region, one expert wrote in Foreign Affairs. Doing more to support Latin America’s rare earth mineral industry and building electric vehicle and microchip factories in the region would reduce US reliance on China while also taming immigration by creating better jobs at home, Shannon K. O’Neil of the Council on Foreign Relations argued. So far, however, “there has been too little bandwidth, too little agency in Washington towards the hemisphere for quite some time now,” Mexico’s former US ambassador told The Hill.