Argentina joins China’s Belt and Road. What are the implications?

The addition of Argentina, the third largest economy in Latin America, comes amid larger Chinese efforts to further integrate the region into the initiative, which has thus far mainly focused on investments and projects across Eurasia and Africa. (Chinese investment in Latin America only amounted to approximately 9% of total BRI spending in 2021.) This shift comes amid challenges to BRI investments across Africa and a recent decrease in Chinese FDI promised toward African projects.

But how does Argentina specifically fit into China’s broader plan for engagement in Latin America, and how should we view this latest development?

China’s plans for Latin America

Chinese sources speculate that Argentina’s entry to the BRI will serve as an accelerant for other large Latin American economies such as Brazil, Mexico, and Colombia — the first, second, and fourth largest economies in the region — to sign MOUs as well. China has routinely used the BRI as an opportunity to expand its sources of raw materials and minerals, as well as to open up new markets to Chinese exports. Chinese total trade across Latin America has rapidly increased from $18 billion in 2002 to $318 billion in 2020, mostly consisting of minerals, natural resources, and agricultural goods. China, however, has expressed its desire to expand the growing economic relationship to include many more areas of mutual interest.

China has conveyed its determination to increase investment and cooperation across Latin America through its frequent diplomatic engagement with The Community of Latin American and Caribbean States (CELAC), an intergovernmental organization consisting of 33 nations across the western hemisphere (of which Argentina currently holds the rotational presidency). In December 2021, a China-CELAC Joint Action Plan for Cooperation was issued, targeting areas for increased cooperation across the political and cultural realms, economics, sciences, technology, infrastructure, and countless other arenas for the 2022-2024 period; Latin American countries’ formal involvement in BRI will only serve to accelerate this growth in cooperation.

Despite warnings by the United States of potential strategic risks posed by Chinese involvement across Latin America, many nations have been dismissive and skeptical of such claims, and have continued to increase and improve their ties to the People’s Republic of China.

U.S. attempts to securitize relations in Latin America

During his testimony before the United States Senate Armed Services Committee in March 2021, Admiral Craig S. Faller, commander of U.S. Southern Command, responsible for the entirety of the western hemisphere, repeatedly signaled alarm over growing Chinese presence in Latin America.

Faller claimed that Chinese involvement in Latin America is “part of a concerted effort by Beijing to indebt fragile countries in the region, impinge on our partners’ and allies’ sovereignty, and use its influence to extract concessions when needed…establish global logistics and basing infrastructure in our hemisphere in order to project and sustain military power at greater distances.” This was additionally supported by claims that “Beijing consistently abuses commercial arrangements at host country ports to support military functions and obfuscate the true purpose of its overseas installations.”

In addition, the recent introduction of the bipartisan “Western Hemisphere Security Strategy Act of 2022,” which specifically names the People’s Republic of China, highlights the growing U.S. view that Chinese involvement in Latin America constitutes a comprehensive security threat.

Senior U.S. government officials have repeatedly warned BRI members about their involvement in the initiative, highlighting the potential for China to leverage debt burdens in order to extract concessions from participating nations, as well as the potential for China to utilize BRI projects for strategic military and intelligence gains. The widely repeated narrative about Chinese “debt-trap diplomacy,” in particular that of the widely-debunked example of Hambantota Port in Sri Lanka, continues to persist — despite immense evidence to the contrary.

Claims that BRI investments can pose military or intelligence threats have even been rebuffed by officials in countries like Israel, a traditional U.S. ally, where U.S. warnings about Chinese management of the Port of Haifa were repeatedly dismissed by senior Israeli defense officials. These claims, despite having been routinely disproven by a number of studies and analyses of Chinese BRI investments globally, have unfortunately not stopped senior U.S. officials, both in the former Trump and current Biden administrations, from routinely claiming that Chinese investments are inherently malign. Whether the U.S. mischaracterization of the BRI is due to simple incompetence or intentional manipulation for domestic political or budgetary gain, it’s apparent that these myths will shape U.S. foreign policy toward Chinese investments going forward.

Expect more U.S. focus on China-Latin America relations

U.S. foreign policy toward Latin America has been said to waver between absolute neglect and intervention; China’s rising presence in the region will undoubtedly push the United States in the direction of the latter.

With Argentina serving as a jumping-off point for growing Chinese involvement in Latin America, expect to see a continuation, if not escalation, in U.S. officials perpetuating falsehoods about Chinese investments while increasing their focus on the securitization of the western hemisphere. Ultimately, Latin American nations will be keen to avoid being entangled in geopolitical tensions between Washington and Beijing, while simultaneously pursuing development goals which may unwittingly aggravate these very tensions through a greater embrace of Chinese investments.