At Nonaligned summit, China seizes an opportunity missed by the United States

At Nonaligned summit, China seizes an opportunity missed by the United
States
The Associated Press

Published: September 13, 2006

HAVANA China hopes to expand its growing economic and political clout at
the Nonaligned Movement summit, influence that analysts say will come at
the cost of the United States, which passed up a similar invitation to
attend as an observer.

Led by China's Vice Minister of Foreign Affairs Yang Jiechi, the Chinese
delegation plans to hold bilateral meetings with a number of Latin
American countries and strengthen China's ties to the region where its
trade soared. China's imports from Latin America quintupled to US$20.3
billion and exports to the region tripled to US$15.4 billion from 2000
to 2004, according to the International Monetary Fund.

The administration of U.S. President George W. Bush has declined to
attend the summit, and a press officer at the U.S. Interests Section in
Havana said they wouldn't comment on the Nonaligned Movement.

That's a mistake, according to Latin America analysts who have tracked
declining U.S. influence in a region where it can no longer count on the
unconditional support of political leaders, even though U.S. trade
remains the most powerful engine for their economies.

"Bush likes to use the saying 'You're either with us or against us' and
they are writing off the summit because they are non-aligned, which to
them means they are not with the U.S.," said Mark Weisbrot, co-director
of the Center for Economic and Policy Research in Washington, D.C.

The United States is wary of the region's more leftist governments, some
of which have openly opposed Washington's economic prescriptions of
economic growth through austerity measures, "free trade" deals and
privatization. The region's economies have largely stabilized —
hyperinflation and crippling debts are mostly history. But poverty and
unemployment remain huge problems, and many Latin Americans feel the
Washington model failed to improve their lives.

Some analysts say the U.S. is out of touch, still trying to impose trade
agreements that will make life even more difficult for the poor while
raising the rhetoric about the dangers of populism in Venezuela, Bolivia
and other countries.

Earlier this year, U.S. Defense Secretary Donald H. Rumsfeld compared
Venezuelan President Hugo Chavez to Adolf Hitler, and Bush worried
publicly about the leadership of Bolivian President Evo Morales.

Chavez's response was telling: At an event with Fidel Castro in Havana,
he noted the waning U.S. influence in the region and echoed Chinese
revolutionary Mao Zedong's idea that capitalist countries were "paper
tigers" to be challenged.

China paid little attention to Latin America until recently, and its
commerce with the region still represents less than one percent of its
collosal foreign trade, according to a Harvard University study
commissioned by Inter-American Dialogue, a Washington research center.
But now China is booming and looking to Latin America for the raw
materials it needs to support its growth, and for new markets to sell to.

And unlike the United States, which often uses trade deals as political
leverage, China has avoided political meddling, said Weisbrot, who
predicts that U.S. commerce may have already peaked as a share of Latin
America's economies, while their trade with China will grow substantially.

China, whose domestic consumption is expected to grow by US$1.3 trillion
($1 trillion euros) in the next decade, is increasingly seen by the
world's developing nations as both a source of investment and a mammoth
emerging market.

China mainly exports machinery, televisions, computers and automobiles
to Latin America. In exchange, it buys about 30 percent of its
agricultural imports (mostly soy beans) from Argentina and Brazil,
China's largest trading partner in the region, and is one of the top
buyers of Chilean copper.

While some Chinese products have made it difficult for some Latin
American industries to compete, Chinese investments have made it easier
for Argentina, Brazil and other countries to buy political independence
with early payoffs of their national debts.

"(The U.S. is) refusing to acknowledge the changes that are taking place
in Latin America," Weisbrot said. "That's why they are losing influence
so rapidly."

While the relationship is purely economic for most developing countries,
Cuba, Bolivia and Venezuela see China as a counterweight to U.S. hegemony.

Relations between the Cuba and China were tense during the Cold War,
when the Caribbean island was strongly allied with the Soviet Union, but
warmed after the Berlin Wall fell in 1989 and Cuba lost its preferential
trade and aid deals with the Soviet bloc.

China is now Cuba's third-largest trading partner, with a trade exchange
of US$985 million in 2005. China invests primarly in Cuba's nickel
industry as well as tourism, transportation and telecommunications.

"Without a doubt these relations have developed in the framework of our
shared political ideology," Cuba's Economics Minister Jose Luis
Rodriguez told reporters at the Nonaligned summit this week.

But Communist Cuba has a unique relationship with China — which so far
seems unwilling to raise political quarrels with the United States over
Latin America, said Javier Corrales, a Latin America expert at Ahmerst
College in Massachussetts.

"At the moment," he said, "what China is doing is not costly in its
relations with the U.S."

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