Last updated: April 5, 2006 5:39 am

China’s new Latin American revolution

Not often, perhaps every half-century or so, a political idea will punch through that forces people to sit and listen. Marxism achieved this at the beginning of the 20th century and stayed almost until the end, ultimately failing because it could not deliver. Nazism fared less well because the prizes it offered came only with war and at the most terrible cost to others. A similar epitaph will eventually be written for al-Qaeda.

But while international political focus has been largely on Islamic fundamentalism and Iraq, an alternative economic and political system has begun to test itself in the Americas – one that may end up seriously challenging western democratic thinking.

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Under the slogan “peaceful rising”, China is “selling” itself to Africa and Latin America as the model for ending poverty. Its pitch is finding an audience among governments that have watched China’s growth leap and their own stagnate while being lectured by the International Monetary Fund and patronised by aid agencies. China’s poor of 20 years ago are now taking out mortgages on first homes while elsewhere others are still scrabbling around for a pair of shoes.

Inevitably, debate will intensify about the relative merits of the Chinese way of doing things. But the real issue is how America will react. China may claim east Asia as its arena. Africa needs any new idea it can get. But Latin America is a different. case. As far back as 1823, when a string of Latin American countries had just gained independence from Spain, James Monroe, the US president, introduced his eponymous doctrine to deter further colonisation of the region.

Prompted then by fears that France, Russia and Spain would club together to take back the newly independent countries, the Monroe doctrine decreed that attempts by European nations to influence the New World would be considered dangerous to the “peace and safety” of the US. After the European threat diminished, the Monroe doctrine remained a cornerstone of US foreign policy. In the cold war it was implemented with ferocity against the Soviet Union’s influence on Cuba, Grenada, Chile and Nicaragua, to name a few.

A generation on and Latin American voters are displaying a tendency to elect left-leaning, US-sceptic leaders – from Hugo Chavez in Venezuela to the softer Luiz Inácio Lula da Silva in Brazil. The next test will be in Peru on Sunday where Ollanta Humala, a populist retired army commander, leads presidential election opinion polls.

For some US legislators and policymakers, the combination of poor societies, left-wing movements and a communist giant make enough of a formula to want to dust off the Monroe doctrine to curb the influence of a rising China. “We should always look at Latin America in relation to the Monroe doctrine,” says Dan Burton, Republican chair of the House subcommittee on the western hemisphere. “We have concerns: Chavez, Castro, Ortega, Morales in Bolivia and their connections with communist China. . .we need to pay particular attention to that.”

If Latin America is not to find itself a new testing ground between an insecure America and an increasingly confident China, this cold war spectre, raised at routine congressional hearings, must be addressed now. Already, among US conspiracy theorists, China’s runaway economy, undervalued currency, absorption of US manufacturing jobs and growing overseas investment risks being portrayed as a Middle Kingdom master plan to conquer the world. The reality of what China might achieve is anybody’s guess. Almost half of China’s direct foreign investment is going into Latin America, and Beijing has pledged it will reach $100bn (£57.7bn) in the next five years. Joint ventures have been agreed in steel, transport and energy and military exchanges are increasing.

None of that should cause Americans concern, unless viewed alongside Beijing’s deep-seated and unresolved differences on how societies should be governed. In the US, it is through elections. In China, it is by ending poverty.

Both governments need to increase opportunities for dialogue. A year from now might be too late. For its part, America should make clear to China the line it must not cross in Latin America if it wants to avoid resurrection of the Monroe doctrine. Most probably, it will be set in the military arena. For China’s part, it must win the argument against comparisons with the cold war-era Soviet Union.

Both governments must work at quelling nationalist voices at home. They should agree, even in private, that what is now termed the “Chinese model” was used by the US to create the successful economies of Taiwan and South Korea in Asia and Chile in Latin America – durable institutions built under nasty dictatorships. Should things get out of hand and cold war fever prevail, there will be a twist. China is one of the biggest owners of US debt, and US stores rely on Chinese goods. The concept of “mutually assured destruction” might be revived – but it will begin with economic, rather than nuclear, holocaust.

The writer, a BBC correspondent and Asia specialist, is an author, most recently of Third World War (Pan); his report on China and Latin America aired this week as part of the BBC’s Inside Latin America series

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