NEWS AMERICAS, NEW YORK, NY, Thurs. Jan. 18, 2024: As China experiences a decline in its population, its government is starting off the year 2024 by strengthening its partnerships in Africa, the Caribbean, and Latin America.
Chinese Foreign Minister Wang Yi, who is also a member of the Political Bureau of the Communist Party of China Central Committee, has been invited to visit Jamaica and Brazil from today, January 18th to Jan. 22nd.
Yi’s visit comes fresh off of a visit to Africa where he also met with Togolese President Faure Gnassingbe R, on Jan. 17, 2024. (Photo by Li Yahui/Xinhua via Getty Images)
The choice of Brazil and Jamaica as the destinations for this visit is significant because both countries are major players in the Latin American and Caribbean (LAC) region, both economically and diplomatically. However, diversifying borrowing nations may not be the top priority in this context.
The visit comes as Chinese Vice President Han Zheng met with the Dominican Republic’s Chamber of Deputies President Alfredo Pacheco via video link in Beijing on Jan. 17th.
According to data from the Chinese Loans to Latin America and the Caribbean (CLLAC) Database, China’s development finance institutions have been supporting projects in only Brazil and Caribbean nations through sovereign loans since 2019. Brazil ranks second in receiving sovereign loans from the China Development Bank and the Export-Import Bank of China, following Venezuela.
In the Caribbean, Jamaica has been the largest borrower from these institutions. Both countries have important environmental vulnerabilities that China should consider in its future financial engagements. Brazil, for instance, is home to two-thirds of the Amazon rainforest, while Jamaica is a small island nation vulnerable to the impacts of climate change.
2024 marks the 50th anniversary of the establishment of diplomatic relations between China and Brazil. Since becoming Brazil’s top trading partner in 2009, the bilateral ties were elevated to a comprehensive strategic partnership in 2012.
During the presidency of Luiz Inacio Lula da Silva in Brazil, the China-Brazil relationship saw stable development. Lula’s administration implemented transformational social programs like “Bolsa Familia,” which means “Family Allowance,” during his first term, partly thanks to China’s substantial demand for Brazil’s commodities. This demand helped lift approximately 20 million people out of poverty, according to the World Bank. Upon returning to the presidency last year, Lula pledged to further “consolidate” Brasilia’s relations with Beijing.
China and Brazil share a close economic relationship, with Beijing purchasing nearly one-third of all Brazilian exports. According to Brazilian government statistics, bilateral trade between China and Brazil has grown significantly, reaching a record high of $150.5 billion in 2022, up from $3.2 billion in 2001. Beijing has also become a major source of foreign direct investment in Brasilia, particularly in sectors such as power generation, oil extraction, telecommunications, financial services, and industry. Between 2007 and 2020, China invested $66 billion in Brazil, making it the recipient of almost half of all Chinese investments in Latin America.
While the China-Brazil relationship has primarily been economic in nature, Lula envisions expanding this partnership beyond trade. His visit to Beijing in April 2023, where he met with Chinese President Xi Jinping, resulted in 15 agreements and Brazilian Real 50 billion (over $10 billion) in investments from China. This visit signaled the broadening of cooperation into areas such as space collaboration, research and innovation, the digital economy, information technology, the automotive industry, and renewable energy. Lula’s trip not only strengthened the relationship but also challenged claims that Chinese investments in Brazil had significantly declined.