China Expands Influence in Central America

WASHINGTON — 

With a library here, a power station there, China is using aid and investment to increase its presence in Central America, posing a challenge to the United States’ 2-century-old diplomatic dominance in the region.

China’s interest is driven in part by its rivalry for diplomatic recognition with Taiwan, a self-governing island which has claimed to be the legitimate government of China since the communist victory on the mainland in 1949. But Beijing is also open about its ambition to supplant the United States as the world’s dominant power.

Swayed by Beijing’s dollar diplomacy, three Central American countries — Panama, El Salvador and Nicaragua — have switched diplomatic recognition from Taiwan to China since 2017. So too has the nearby Caribbean island nation of Dominican Republic.

Costa Rica, Honduras, Guatemala and Belize round out the nations of the isthmus connecting North and South America, a region first claimed as part of the U.S. sphere of influence with the enunciation of the Monroe Doctrine in 1823.

Luis G. Solis, interim director of the Kimberly Green Latin American and Caribbean Center at Florida International University, told VOA Mandarin that the U.S. still enjoys an advantage in the region in terms of military, economic, trade, and cultural affairs.

“If these advantages are adequately handled through a proactive diplomacy and a solid developmental agenda, China’s space will be greatly diminished,” he said. “But this entails creativity, the investment of time and goodwill, and a permanent and productive dialogue on sensitive issues such as migrations, corruption and transnational organized crime.”

China’s most recent investment occurred in El Salvador, where President Nayib Bukele thanked China for funding of the country’s new national library as construction began Feb. 6.

The $40 million cultural center, located in the capital city of San Salvador, resulted from Bukele’s visit to China in 2019, according to Evan Ellis, a senior associate at the Americas Program of CSIS. The president also secured $500 million for projects including a sports stadium, a new tourist pier, improvement of its water treatment facilities as well as backing for his Surf City project to turn the country’s Pacific coast into a beach vacation destination, according to the 2021 CSIS article, China and El Salvador: An Update.

Also in 2019, El Salvador signed on with China’s controversial Belt and Road Initiative, (BRI) a global infrastructure plan consisting of a “belt” of overland corridors and a maritime “road” of shipping lanes.

Bukele’s efforts came after El Salvador severed its ties with Taiwan in 2018 under his predecessor, Salvador Sánchez Cerén, who led the fight against a U.S.-backed regime during a civil war that lasted from 1979-92.

China’s buildup in Central America has grown since management of the Panama Canal transferred from the joint U.S.-Panamanian Panama Canal Commission to the Republic of Panama in 1999, according to an article by Daniel Runde, director of the Americas Program at CSIS.

In November 1999, the Panamanian government awarded the Hong-Kong based firm Hutchison-Whampoa concessions to operate ports on both the Atlantic and Pacific sides of the canal, according to the website DialogoChino.

Since then, “Chinese companies have been heavily involved in infrastructure-related contracts in and around the canal, in Panama’s logistics, electricity, and construction sectors,” according to DialogoChino.

By 2017, Panama had shifted diplomatic relations from Taiwan to Beijing and five months later became the first country in the region to join BRI. Since then, China has invested in over 20 infrastructure projects in the country, including bridges, railways and power stations. As of January, Belize, Guatemala and Honduras are not BRI partners with China.

China’s state-back media Global Times published an opinion piece on December 13, 2021, by Pan Deng, executive director of the Latin American and Caribbean Region Law Center of China University of Political Science and Law. He suggested that the U.S. views Central American nations as “sources of cheap labor and low-end industrial raw materials, but also the dumping ground for outmoded American industries.”

The piece continued to say, “Previously, these countries had no other choices but to turn to the U.S. However, as China has developed rapidly in recent years, a reference model is being provided for how developing countries can develop from backward agricultural countries to industrialized ones while achieving long-term social stability.”

Analysts say that Beijing is using aid in various guises to persuade more Central American and Caribbean countries to establish formal relationships with the People’s Republic of China (PRC).

Benjamin Gedan, deputy director of the Wilson Center’s Latin American Program, told VOA Mandarin that Beijing has an economic agenda in Central America and the Caribbean, but the effort is driven largely by geopolitical considerations, “including its bitter rivalry with Taiwan and its desire for support in multilateral institutions.”

“Given the Chinese Communist Party’s intense focus on isolating Taiwan, it is likely to continue investing in Central America and the Caribbean. After all, Beijing likely sees these countries as relatively cheap to buy off, and it has enjoyed a string of diplomatic victories,” Gedan added.

Another goal for China’s efforts in the region is to expand the BRI to Central America, as a push to play a bigger role on the global stage.

In December 2021, Cuba became the latest country to join China’s Belt and Road initiative. Jamaica joined in 2019, as did six other island nations in the Caribbean, and Costa Rica joined in 2018.

China has also increased its investment in natural resources in Central America and the Caribbean Basin. According to the Congressional Research Service, in 2020, China’s imports from Latin America and Caribbean countries amounted to $165 billion, consisting primarily of natural resources, such as ores (35%), mineral fuels (12%) and copper (6%).

Rebecca Ray, a senior academic researcher at the Boston University Global Development Policy Center, told VOA Mandarin that she’s not surprised to see China’s interest in infrastructure cooperation with Central America and productive investments in the Caribbean.

She pointed out that the Central American region has suffered from weak economic growth for decades. It is also vulnerable to climate change, which is bringing more natural disasters to low-lying islands and coastal areas. As a result, according to Ray, these countries have a greater need for new inbound investment.

“At the same time, Western investors have not shown interest in starting new projects or being exposed to developing country economies during the COVID-19 pandemic. Thus, any new potential source of investment will naturally be taken seriously,” she added.

Despite the need for infrastructure investment in Central America and the Caribbean, the biggest obstacle to maintaining economic growth may be poor governance, according to online magazine Dialogo.

“Partnership with China might bring in new foreign investments, but it only deepens governance challenges, given China’s disinterest in corruption, its lack of transparency, and its export of technologies that enable Central American governments to curtail civil liberties,” said Gedan.

Microsoft said in December 2021 that it believed Beijing-backed hackers were targeting organizations in both the private and public sectors in five Central American nations: Dominican Republic, Ecuador, El Salvador, Honduras, and Panama.

North Korea Expands China Trade, But Wider Pandemic Approach Unclear

SEOUL, SOUTH KOREA — 

North Korea this week resumed railway imports from China for the first time since its lockdown began in 2020, potentially signaling a new phase in its approach to the pandemic.

Since Sunday, North Korean freight trains have made several round trips across the Yalu River separating the North Korean city of Sinuiju and the Chinese city of Dandong.

That is a significant relaxation of COVID-19 measures for North Korea, which has taken perhaps the world’s most severe pandemic precautions.

However, there are more questions than answers about what the move says about North Korea’s future pandemic approach and when it will attempt to fully resume trade with China, its economic lifeline.

Why did North Korea resume trade now?

It is possible the decision was driven by desperation spurred by shortages of food or other supplies. There could also be far duller explanations, though, said Peter Ward, a Seoul-based specialist on North Korea’s economy.

“There are loads of reasons why you’d want to reopen it. And those reasons may not be, ‘Well, there’s going to be a revolution next week unless people in north Pyongyang get their food rations,’” he said.

North Korea, Ward suggested, might be increasing entry options for imports from China, which was already sending some goods to North Korea by ship. It is also possible a well-connected official in Sinuiju, which relies on trade with China and has suffered economically during the pandemic, may have lobbied North Korean leader Kim Jong Un to restart the railway imports.

Or it could be that North Korea is now confident enough in its import safety measures, following months of preparation.

What goods are North Korea importing so far?

During the pandemic, North Korea has experienced shortages of food, medicine, fertilizer, and construction supplies. Some of those items appeared to be included in the first shipments from China, according to video broadcast by several Japanese and South Korean media outlets.

“But I think there is a strong chance Kim Jong Un also used the deliveries to Pyongyang to stock up on the gifts he intends to dole out for upcoming celebrations in order to maintain loyalty to the Kim family,” Jean Lee, a senior fellow at the Wilson Center, a Washington-based research organization, said.

On Thursday, a state media readout of a high-profile Politburo meeting mentioned that North Korea should prepare to “grandly” celebrate the coming birthdays of late leaders Kim Il Sung and Kim Jong Il, which are major public holidays.

FILE – Citizens visit the bronze statues of their late leaders Kim Il Sung, left, and Kim Jong Il on Mansu Hill in Pyongyang, North Korea Thursday, Dec. 16, 2021, on the occasion of 10th anniversary of demise of Kim Jong Il.

The Daily NK, a Seoul-based publication with a network of sources in North Korea, reported this week at least some of the initial shipments included soybean oil, a cooking staple, which will be distributed as gifts on the holidays, known as the Day of the Sun and the Day of the Shining Star.

“Everything right now is focused on preparations to glorify the Kim family — not necessarily on the well-being of the North Korean people,” Lee said.

What safety precautions is North Korea taking with the import process?

A lot. In fact, North Korea appears to be so cautious that it may not even be allowing any North Koreans to enter China to facilitate the shipments. Video of the transfers appears to show a Chinese locomotive dropping off train cars full of goods to North Korea, before bringing empty cars back to China to reload.

Once in North Korea, the cargo appears to enter a disinfection facility recently constructed at an airport near the border, according to commercial satellite photos reported by NK News, a Seoul-based outlet that covers North Korea. At the facility, the goods will likely be sterilized and quarantined, possibly for weeks, analysts say.

Many scientific studies conclude it is very difficult for people to be infected with COVID-19 through contact with contaminated surfaces or objects. However, North Korea is taking no chances, Colin Zwirko, senior NK News correspondent, said.

FILE – People wearing protective face masks walk amid concerns over the new coronavirus disease (COVID-19) in front of Pyongyang Station in Pyongyang, North Korea April 27, 2020, in this photo released by Kyodo.

“North Korea maintains the most severe ‘zero-COVID’ policy in the world because an outbreak could lead to the collapse of the entire system, they admit this in state media. This means they are willing to prevent infections at all costs, even if it requires quarantining objects for long periods that might stand little chance of transmitting the virus. It’s a better-safe-than-sorry approach,” Zwirko says.

In the past, North Korean officials have embraced numerous scientifically questionable theories about how COVID-19 spreads. The virus, state media have reported, could spread through migratory birds, snow, air pollution, or anti-Pyongyang propaganda leaflets sent by South Korean activists.

How much trade will North Korea allow?

So far, Japanese and South Korean media have reported at least three roundtrips by freight trains from Sunday through Wednesday. South Korean officials said Thursday they have “steadily detected” train activity, but they could not say how long the train service will continue.

On Monday, China’s Foreign Affairs Ministry confirmed that rail traffic between North Korea and China had “resumed operation,” suggesting the activity could become regular. It is not clear, however, how quickly the quarantine and disinfection facilities will fill up. Some analysts speculate that that process could be a choke point limiting a wider resumption in trade.

So far, it appears that the trains have only sent goods in one direction, to North Korea, but Daily NK reported Thursday that some North Korean trading companies have begun preparing items for export to China, following an order from authorities.

Both sides have a long way to go to restore pre-pandemic trade levels. According to Chinese government data released this week, China’s trade with North Korea in 2021 fell about 90% compared to 2019, the year before the pandemic restrictions began.

How will North Korea handle the pandemic moving forward?

While many analysts think North Korea’s trade with China will gradually increase this year, others warn there could be setbacks, especially as China calibrates its own “zero-COVID” policy and struggles to keep out the more transmissible omicron variant.

FILE – Staff of the Pyongyang Department Store No. 1 disinfect the store to help curb the spread of the coronavirus before it opens in Pyongyang, North Korea, Dec. 28, 2020.

It is also not clear whether North Korea will loosen other pandemic restrictions, such as its domestic travel restrictions and border security policies. Since the pandemic began, North Korea has dramatically increased patrols along its border with China, reportedly even issuing shoot-to-kill orders for illegal crossers. The measures have led to a drastic reduction in the number of North Korean escapees and cut off virtually all informal trade, such as smuggling and remittance payments.

Pyongyang may not feel comfortable easing many of those restrictions until it has tools, beyond lockdowns, to combat the virus.

North Korea has refused offers of COVID-19 vaccines from other countries and the United Nations-backed COVAX vaccine distribution initiative. According to the World Health Organization, it is one of only two countries yet to begin vaccination campaigns, the other being Eritrea.