El politólogo Patricio Giusto, nacido en Gualeguaychú, Entre Ríos, finalizó su  tesis de maestría en estudios sobre China, recientemente aprobada con calificación A, en la Universidad de Zhejiang. Se titula Xi Jinping’s political era: Implications and perspectives for Latin America y entre otros temas focaliza la actualidad política de China frente al nuevo contexto político latinoamericano y la relación triangular con Estados Unidos. Tuvo la gentileza de enviarla a Dang Dai para su difusión.

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–Xi Jinping’s political era: Implications and perspectives for Latin America 

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         Por Patricio Javier Giusto

ABSTRACT

This research analyzes Xi Jinping’s political era in China regarding the implications and perspectives for the relation with Latin America, considering a series of relevant historical, economic and geopolitical aspects. Latin America has had a historical economic significance for China and vice versa, but since Xi Jinping came into power there has been a remarkable deepening in the ties and expansion to new areas of cooperation, not only in the economic realm.Xi provided a renewed and comprehensive strategic vision, following the path laid out for his predecessors.Latin America has definitely acquired a new geopolitical importance for China, the emerging superpower of the 21^st Century. In this new context, there are big challenges but also great opportunities when looking to the future of the relations. The focus of this research is on the following questions: How the relations between China and Latin America have evolved since its origins? Which have been the breaks and continuities in the relations? What Xi Jinping represents for China, for the world and, especially, for Latin America? How has been the political and economic relations with Latin America since Xi took office? Which is his strategy for the region and what is new, when comparing with his predecessors? How will Latin America deal in front of China’s ‘new normal’ economic phase? Can the relations be ‘win-win’ in the present scenario? Is the new political context in Latin America less favorable to China? Is there a new ‘triangle’ in the relations between China, Latin America and the United States? And, finally, what the particular case of the relations between China and Argentina provides in terms of understanding the increasing Chinese interest towards Latin America?

The sources of information of this research are abundant, varied and up to present-day. Numerous prominent specialists in the subject have been included, from China, Latin America and the West in general, in order to provide a comprehensive and plural outlook on the above-mentioned matters.

Key words: China, Xi Jinping, Latin America, Argentina, United States.

CHAPTER I

INTRODUCTION

This opening chapter includes the following introductory subjects: Justification of the topic chosen, explanation of general and specific goals, methodology of research, sources of analysis, theoretical considerations, general aspects of China and its political system and, finally, an overall outlook on Latin America[1] and Argentina.

1.1 Why this topic

The election of my thesis topic has a lot to do with my professional background and research interests. I am a Bachelor in Political Sciences specialized in Political Processes, graduated from the Pontifical Catholic University of Argentina, institution in which I am a regular professor of Political Law, General World History and Introduction to Political Sciences. I also have a Master’s degree in Public Policies from the Latin American Social Sciences Institute, among others postgraduate studies related to political sciences.

Throughout my professional career, I have participated in several social investigations, as well as I have given many lectures. I am also author of numerous publications on the following issues: Latin America and Argentine politics, history and economy, Asian geopolitics, political systems analysis, public policies, social conflict, government communication and political technologies, among others.

During the past years, I have also had the possibility to work both in the private and public sector as a political analyst and advisor for top policy makers in my country. At the same time, I have worked in two prestigious consultancy groups, which allowed me to develop high qualified skills for my field of study. In 2007, I co-founded with a colleague from college my own center of political studies, “Diagnóstico Político”, being since then its Managing Director.

China and Latin America

Regarding the topic chosen, China has recently become a strategic political and economic partner for most of Latin American countries. Despite the enormous geographical distance, the relation between China and LAC has been growing substantially over the last decades, though with a huge potential still to be developed, due to shared complementarities.

LAC is extremely rich in raw materials and agricultural products that China needs, as well as an attractive market for its manufactured products. On the other hand, more and more the Latin American countries need the Chinese investment and financial support in order to improve its underdeveloped infrastructure.

The political and commercial relations between both sides have recently reached unprecedented levels of exchange. Historically defined by the raw materials exports from South America, now the relation with China involves the expansion to previously unexplored fields, such as investment in strategic sectors and financial cooperation.Argentina can serve as a very good example in that sense.

This new context, which is directly linked to recent changes in the Chinese economy and the drop in the commodities prices, awakened huge expectations but also big concerns in LAC. The opinions are divided. There are those who foresee a “win-win” period, which will contribute to the development of Latin American countries. On the other hand, some others consider that this is a return to historical patterns of dependency in a post-commodity boom environment.

With China increasing exponentially its presence in the region, ultimately the discussion remains the same as during the long period when LAC used to be the “backyard” of the United States (US): How to consolidate a more economically and environmentally sustainable relationship with the new ‘big partner’. In that sense, there is a new political context in LAC that will not necessarily be less favorable to China.

This recent phase of the relations between China and LAC has also a clear geopolitical dimension, associated to China becoming a global superpower and its natural expansion to new spheres of influence in the world. Two factors are key to explain this new dynamic: Xi Jinping’s strong leadership, assertiveness and international projection, at the same time the USretreats from LAC, redefining the ‘triangle’ between them.

Bearing all this in mind, I consider that the political period initiated in China under Xi Jinping’s leadership is ushering a new era regarding the ties with LAC, with a renewed strategic vision that aims to deepen and expand the cooperation to new areas. This deserves to be analyzed thoughtfully, in order to contribute to a better understanding of its implications and future perspectives for both sides.

The contribution of this research

The value and originality of this research lies in the fact that represents a comprehensive review of the historical evolution of the relations between China and LAC, with focus in the recent years, since Xi Jinping took office.

Moreover, crucial debates on the future of the relations are addressed considering not only economic aspects, but also a series of historical and geopolitical elements that have been little studied in comparison with the most usual economic approaches.

Finally, the sources of information of this research are abundant, varied and up to present-day. Numerous prominent specialists in the subject have been included, from China, Latin America and the West in general, in order to present a broad and plural outlook.

1.2 General and specific goals

The general goal of this thesis is to analyze the Xi Jinping’s political era in China regarding the implications and perspectives for the relation with LAC, considering a series of relevant historical, economic and geopolitical aspects.

The specific goals are the following:

–         Review the historical evolution of the political and economic relations between China and LAC, from its origins until Xi Jinping came into power.

–         Characterize Xi Jinping’s administration: His personal background, style of leadership, core ideas, central policies, foreign affairs approach and other relevant elements of the Chinese political context since he took office.

–         Analyzethe evolution of the relations between China and LAC during Xi’s time in power, focusing on his strategy for the region and its economic and geopolitical implications.

–         Address three current debates on the present and future of the relations between China and LAC: China’s ‘new normal’ economic phase and its effects on LAC, the new political context in LAC and the ‘triangle’ of relations between China, LAC and the United States.

–         Present the particular case of the relations between China and Argentina, emphasizing the evolution of the relation and relevant events during Xi’s period.

1.3Methodology, sources of analysis and theoretical considerations

Due to subject of this thesis and the technical requirements provided by the academic authorities of the Master of China Studies at Zhejiang University, the methodology to conduct this research was preeminently qualitative, based on the following bibliographical and empirical sources[2]:

1) Official documents and economic statistics from the Chinese and Latin American Governments, as well as multilateral organizations’ releases.

2) Books, academic articles, press releases and other specialized publications, both from the Chinese and Western -especially Latin American- sides.

3) Specific interviews with academic referents for the case analysis of Argentina.

Concerning the theoretical basis, this paper is focused on general historical, geopolitical and economic aspects of the relation between China and LAC, regarded as relevant according to the defined goals of research.

The historical review presented on the relation between China and LAC aims to succinctly highlight the key political and economic events of the history of the relation, in order to provide context for the analysis of the current scenario. Also, the purpose is to identify the main changes and continuities in the relation.

When referring to the economic aspects of the relation between China and LAC, the emphasis will be put on the main flows of trade, financing and investments. The increasing liberalization in commerce and the bilateral Free Trade Agreements (FTA) will be also taken into account, as crucial factors for the relation between both sides.

On the other hand, geopolitics is understood as the “study of the influence of such factors as geography, economics, and demography in politics and, especially, the foreign policy of a State”.[3] The most relevant factors usually considered in geopolitics analysis are: advantageous geographical position, abundant natural resources, favorable climate, extent of territory, access to the sea and population large enough to defend its territory.

The word ‘geopolitics’ was originally coined in 1901 by the Swedish political scientist Rudolf Kjellén (1864-1922). However, German geographer Friedrich Ratzel (1844-1904) is generally considered the founding father of modern geopolitics, after his famous essay “Lebensraum” (1901) related to biogeography. Many schools of geopolitics proliferated during the 20^th Century, especially in France, United Kingdom, Russia and the United States.[4]

The Chinese role in modern geopolitics is very interesting, given the fact that the widely influential essay of military strategy “The Art of War” -written around the Fifth Century BC and credited to Sun Zi– has been extremely influential for most of modern and contemporary geopolitics theorists. “The Art of War” has been worldwide regarded as one of the most prominent works of military strategy, affecting both Eastern and Western philosophy and political sciences.[5]

1.4 General aspects of China and its political system

China, officially the People’s Republic of China (PRC), is a unitary and multiethnic sovereign State, located in East Asia. With a population of over 1.381 billion, it is the world’s most populous country. Since 1949, the State is governed by the Communist Party of China (CPC, from now on), and its capital is Beijing. China is composed by 23 provinces, five autonomous regions, four direct-controlled municipalities (Beijing, Tianjin, Shanghai, and Chongqing), and two Special Administrative Regions (Hong Kong and Macau).[6]

Covering approximately 9.6 million square kilometers, China is the world’s second largest State by land area. China emerged as one of the world’s earliest civilizations in the fertile basin of the Yellow River in the North China Plain. For millennia, China’s political system was based on hereditary monarchies known as dynasties.

In 1912, The Republic of China (ROC) replaced the last dynasty (Qing), and ruled the Chinese mainland until 1949, when it was defeated by the Communist People’s Liberation Army in the Chinese Civil War. The CPC established the People’s Republic in 1949, while the ROC government relocated to Taiwan with its present de facto temporary capital in Taipei. The Government of the PRC also considers Taiwan as part of its sovereign territory, according to the indeclinable “One China Policy”.[7]

China’s political institutions

According to China’s State Constitution, enacted in 1982, the National People’s Congress (NPC) oversees the State Council, as well as four other institutions: The Presidency, the Supreme People’s Court, the Public Prosecutors’ Office, and the Military. NPC deputies are expected to approve all budgets, agency reports, and personnel appointments put before them. The NPC’s most significant power is its ability to initiate and shape legislation.[8][9]

The formal political system also includes two other categories of institutions, although they have little substantive power. The first is People’s Political Consultative Conferences (PPCCs), the most senior level of which is known as the Chinese People’s Political Consultative Conference (CPPCC) National Committee. The Party and State ostensibly ‘consult’ with PPCCs on policy issues.[10]

The second set of institutions is China’s eight minor political parties, known as the ‘democratic parties’. All the parties were established before the Communists came to power, pledge loyalty to the CPC, and accept its leadership. The existence of the PPCCs and the minor parties allows the CPC to describe China’s political system as one of multi-party cooperation and political consultation led by the CPC.[11]

Structure of the Communist Party

The seven men who sit on the country’s most senior decision-making body, the CPC’s Politburo Standing Committee (PSC), form a collective leadership in which each man has a rank, from one to seven, and shoulders primary responsibility for a specific portfolio. Since 2013, Party General Secretary Xi Jinping is ranked first among the seven and has responsibility for convening PSC and larger Politburo meetings. He also controls some of the most consequential portfolios, including military and foreign affairs.[12]

Below the PSC, the CPC has other three levels: The full Politburo (25 members), the Central Committee (205 members and 171 alternate) and the Party Congress (2,270 delegates). The CPC has around 82.6 million members, which constitute approximately 6% of China’s population.Regarding China’s military, the People’s Liberation Army (PLA) it is an armed wing of the CPC, with the Party’s exercise of “absolute leadership” over the military, representing a fundamental guarantee of CPC rule.[13]

The economy and the place of China in the international community

Since the introduction of the “reform and opening-up” policies in 1978, under Deng Xiaoping leadership, China has become one of the world’s fastest-growing major economies. Since 2010, when surpassed Japan, China is the world’s second-largest economy by nominal GDP and largest by Purchasing Power Parity (PPP), inferior only to the United States, according to the International Monetary Fund (IMF).[14]

China is also the world’s largest exporter and second-largest importer of goods. Its currency, the Renminbi (RMB), trades in the world’s financial centers and exchanges in bilateral trade between numerous countries. China has, as well, the world’s largest standing army and second-largest defense budget.

In 1971, the PRC became a member of the United Nations and has permanent seat in its Security Council. China is also a member of numerous formal and informal multilateral organizations, including UN, WTO, APEC, BRICS, SCO, BCIM, G-8 and G-20.

1.5 General outlook of Latin America and Argentina

Latin America is a group of countries and dependencies in the Americas where Romance languages derived from Latin are predominant.Especially Spanish, but also Portuguese, French, and the creole languages based upon these. Latin America is therefore broader than the terms Ibero-America or Hispanic-America, though it usually excludes French speaking countries and other dependencies.[15]

LAC consists of twenty-one sovereign states and several territories and dependencies which cover an area that stretches from the northern border of Mexico to the southern tip of South America, including the Caribbean islands. It has an area of approximately 19,197,000 km2, almost 13% of the Earth’s land surface area.

The Latin American countries and other dependencies are the following, in alphabetical order and divided by sub-regions:

Central America: Belize, Costa Rica, El Salvador, Guatemala, Honduras, Mexico (in some cases, considered as part of North America along with the United States and Canada), Nicaragua and Panama.

South America: Argentina, Bolivia, Brazil, Chile, Colombia, Ecuador, Guyana, Paraguay, Peru, Suriname, Uruguay and Venezuela. This sub-region also includes French Guiana (overseas department of France),

The Caribbean: It is integrated by 30 territories, including sovereign states, overseas departments, and other dependencies. The most important sovereign states are Cuba, Dominican Republic and Haiti. This sub-region has several small dependencies and constituent entities, such as Guadeloupe (overseas department of France) and Puerto Rico (U.S. Commonwealth and former Spanish territory), among others.

The Caribbean also includes a series of small independent countries, such as Jamaica and Trinidad and Tobago, as well as other dependencies, that were part of the British and Dutch colonization periods.

Demography, economy and politics in Latin America

As of 2015, the population of LAC was estimated at more than 626 million, with Brazil (205 million) and México (122 million) leading in that field. According to the World Bank, in 2014 LAC had a combined nominal GDP of 5,573,397 million USD and a GDP PPP of 7,531,585 million USD.

LAC is predominantly and under-developed region, though some countries like Chile and Uruguay have reached human development and income rates well above the average of the region. Latin America’s GDP per capita has fluctuated around world average over the past decades and the region has grown at slower pace, compared with the Asian countries.[16]

The world share output of LAC had declined from 9.5% in 1980 to 7.8% by 2008. In that sense, except for a few cases, the “commodities boom” during the last decade didn’t turn into development for the countries of region.[17]

Poverty continues to be one of the region’s main challenges, according to the United Nations Economic Commission for Latin America and the Caribbean (UNECLAC).[18] It is something often hard to understand by foreign observers, as the region is extremely rich in natural and human resources. For instance, in Venezuela, country that is going through the worst economic crisis of its entire history, poverty has reached the scandalous level of 81% during 2016.[19]

On the other hand, republican democracy is nowadays the predominant political system adopted by the countries of LAC, after many waves of military dictatorships occurred during the 20^th Century. However, political turmoil, economic volatility and social unrest have been a constant all along the region, since the new democratic era initiated after the 1980s. Nevertheless, LAC remains to be broadly considered as a land full of opportunities and huge potential of development.

Argentina[20]

The Republic of Argentina is a federal sovereign country located in the southern half of South America. Sharing the bulk of the Southern Cone with its neighbor Chile to the west, the country is also bordered by Bolivia and Paraguay to the north, Brazil to the northeast, Uruguay and the South Atlantic Ocean to the east, and the Drake Passage to the south.

With a mainland area of 2,780,400 km2, Argentina is the eighth-largest country in the world and the second largest in LAC after Brazil. The country is subdivided into twenty-three provinces (autonomous and autarchic entities) and one autonomous city, Buenos Aires, which is the federal capital of the Nation.

The provinces and the City of Buenos Aires have their own constitutions, but exist as inseparable parts of the Federal State. Argentina claims its permanent and indeclinable sovereignty over part of Antarctica, the Malvinas Islands (under British usurpation since 1833), and South Georgia and the South Sandwich Islands.

The country has its roots in the Spanish colonization of the region during the 16th century. The first independent government was established in 1810, in Buenos Aires. After the wars for liberation against the Spanish Empire, the Independence was declared in 1816. This was followed by an extended civil war between the unitary party and the federalists that lasted until 1853, when the first national and federal Constitution was enacted. However, internal conflicts between Buenos Aires and the federalist provinces remained until the end of the 1870s.

Argentina thereafter enjoyed relative peace and stability, with massive waves of European immigration radically reshaping its cultural and demographic outlook. The almost-unparalleled increase in prosperity led to Argentina becoming the seventh wealthiest developed nation in the world by the early 20th century.

In 1930, the country suffered the first military coup under democratic ruling, leading to a military dictatorship (1930-1932). It represented the beginning of a long period of political instability and recurring economic crisis that resulted in successive military dictatorships (1943-1946; 1966-1973 and 1976-1983).

Since the definite return to democratic ruling, in 1983, the country alternated governments from different political parties. But a series of deep economic and political crisis, especially the one occurred in 2001, which led to a historic default, continued to be a hallmark of the country. By the end of 2016, 30.3% of the Argentine population was still poor, according to official statistics.[21]

Nonetheless, Argentina has currently the second largest economy in South America after Brazil and the third-largest in LAC. Moreover, the World Bank still qualifies the country with a rating of “very high income”.[22] Regarding demography, Argentina is the fourth most populated country in LAC (around 40 million by 2010), after Brazil, Mexico and Colombia.

In international affairs, Argentina is a member of the G-20 major economies. It is also a founding member of United Nations, World Bank, World Trade Organization, Mercosur, Union of South American Nations, Community of Latin American and Caribbean States and the Organization of Ibero-American States, among other multilateral organizations.

CHAPTER II

REVIEW ON THE HISTORY OF THE RELATIONS BETWEEN CHINA AND LATIN AMERICA

This chapter aims to briefly depict the historical evolution of the relation between China and Latin America, focusing on key political and economic events, in order to distinguish breaks and continuities and also provide context to analyze the current situation. The emphasis is posed on the period from 1949, when the People’s Republic was established, to 2012, when Xi Jinping was appointed as China’s supreme leader.

2.1 Tracing back the origins of the relation: From the ‘Coolie trade’ to the Republic of China

Many historians claim that Sino-Latin American relations go as far back as the 16^th Century. By that time, the recent process of European colonization in the region was rapidly expanding to all edges of the so-called ‘New World’.

The first contacts between China and LAC were through the exchange of goods. “The ‘silk road of the sea’ saw 20 to 60 ships sail between China’s coastal regions and Mexico’s Acapulco harbor every year. Via a stopover in the Spanish colony of Manila, in the Philippines, goods like silk, cotton, jewelry and gun powder were shipped to the New World in exchange for shoes, olive oil and wine, creating a trade route that persisted until 1815”, describes American journalist Alex McAnarney.[23]

During the late 19th to early 20th Century, Chinese immigrants arrived as manual laborers known derogatorily as “coolies”. Under semi-slavery conditions, these immigrants came to further shape the societies they inhabited.Many Chinese nationals arrived in LAC, especially Mexico, as personal servants of Spanish merchants and members of the royalty.[24]

“The so-called ‘Manila Galleons’ carried silk, porcelain, tea and other Chinese and Asian goods to the New World and thence to Europe, while carrying back silver from the mines of Nueva España -New Spain, which became Mexico – silver that provided the money supply to fuel the Chinese economy”, comments Germán Muñoz, president of the Mexican Chamber of Commerce in Hong Kong.[25]

The ‘Silver Way’ was the Pacific leg of, perhaps, the first global trade route, extending to Mexico and thence to Spain and Europe.The Chinese crews were largely from Fijian province.[26]

Historian Tatiana Seijas provides more details on this matter: “During the late sixteenth and seventeenth centuries, countless slaves from culturally diverse communities in the Indian subcontinent and Southeast Asia journeyed to Mexico on the ships of the Manila Galleon. On arrival in Mexico, slave owners and Spanish officials grouped them together, overlooked their social and linguistic differences, and categorized them as ‘chinos’”.[27]

Arnold Meagher, author of an exhaustive research on the Chinese laborers traffic to LAC, adds his point of view: “The termination of the African slave trade, an urgent need for laborers in the West, and a deteriorating Chinese economy conspired to spawn the emigration of more than a quarter million Chinese laborers to Latin America, in the span of 28 years (1847-1874)”.[28]

The Chinese immigration to Central and South America

In the rest of Central American countries, Nicaragua and Panama led the way in the reception of Chinese population. The presence of Chinese nationals in Nicaragua can be traced back to 1920. The majority, from Guangdong province, set up small businesses or worked in the mines.In Panama, around the same period, Chinese immigrants arrived to work on the construction of the Canal. Their descendants later established a thriving community, successfully integrated with the local population and economy.[29]