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China v U.S.: What Growing Tensions Mean For Latin America

While the U.S.-China rivalry is not yet a repetition of the Cold War, it will have repercussions for Latin American states at a time of acute regional weakness.

Chinese President Xi Jinping and American President Donald Trump
Chinese President Xi Jinping and American President Donald Trump
Juan Gabriel Tokatlian

-Analysis-

BUENOS AIRES — One often hears comparisons between the United States' fraught ties with China and its Cold War relations with the Soviet Union. It is the wrong comparison, both conceptually and politically. We should remember that perspective counts, and here in Argentina, we should view the world from the Latin American perspective.

After World War II, ties between Washington and Moscow were essentially a showdown between two contradictory socio-economic and political models. Cultural ties and material exchanges were extremely limited, with bilateral trade peaking in 1979 at $4.5 billion.

The superpowers' competition was essentially gauged in terms of their capacity for (mutual) destruction: In 1982, each side possessed about 10,000 nuclear warheads. Both sides had a shared understanding — be it tacit or explicit — of their respective spheres of influence.

In Latin America and Eastern Europe, they imposed a notion of limited sovereignty consistent with the idea that any state shifting its allegiance from one block to another could expect severe penalties. Yet both sides promoted regime change among Third World states and sought to tip them into their own ideological camp.

Washington duly entrenched the idea throughout the West that the U.S. was the main architect of the liberal international order while the Soviets were a revisionist power whose overriding aim was to overturn the existing rules of the game.

A portrait of Deng Xiaoping as part of of the 70th anniversary of the People's Republic of China — Photo: Wang Song/Xinhua/ZUMA

Instead, today, the U.S. and China express two opposing modalities of capitalism, in spite of reforms China's late ruler Deng Xiaoping began in 1978 to modernize socialism in a notably backward country. Their relations are unfolding in the context of a faster power transition within international relations. They are similar to the rivalries of the historical great powers, though with some distinctive traits: The transition is from West to East (rather than a power shift inside the West), in a world with an unprecedented number of nuclear arsenals, and with the presence of numerous state and non-state actors (with differing degrees of resources and influence). Considering the military balance alone will not fully reveal the dynamics of Sino-American ties.

In 2019, the total defense budgets of all NATO members and the United States' biggest allies in the Pacific rim stood at around $1.1 trillion, while China's was $181 billion. Washington has 5,800 nuclear warheads, while China has 320. Beijing has had a very different nuclear posture to the Soviet Union's. Its competition is more in terms of wealth than military might,and future frictions will undoubtedly concern areas like trade, finance and technology.

Still, alongside the obvious rivalry between the two countries, there is also interdependence. Bilateral trade was worth $630 billion in 2018. China's accumulated investments in the U.S. through 1990-2019 were worth $150 billion, with the U.S. investing $284 billion in China in the same period. The relationship has other aspects. In 2019, of just under 1.1 million foreign students in the U.S., 369,000 were from China.

Our region will lose leeway in managing its ties with the United States and China.

Washington still believes in principles of regime change and interventionism, and resorts to coercive diplomacy. None of these are Chinese practices for now. With President Donald Trump, Washington has become a power dissatisfied with the international liberal order it helped build, while China seems to be carefully managing an alternative global model. The post-pandemic period will reveal whether or not this nuanced rivalry will turn into outright enmity, and if interdependence will yield to gradual disconnection on both sides, as a prelude to a strategic fight.

Reading contemporary geopolitics with a Cold War lens may lead to bigger mistakes. But the Latin American perspective cannot ignore the growing dispute between two superpowers. As this confrontation deepens and regional fragmentation increases, our region will lose leeway in managing its ties with the U.S. and China.

With either Trump or his Democratic rival Joe Biden in office, Washington will still insist on no-nonsense loyalty. China's leader will in turn make sure regional states feel the weight of its ascent in the world. States will undoubtedly wind up submitting to one or another side, though this can only weaken the autonomy of regional states as a whole. We should remember, the logic of "every man for himself" will lead to individual and collective dependency.

But here's the real paradox: We are not facing a simple choice of "unity or domination," but the prospect of becoming less viable at home and regionally even as both the U.S. and China use us as a territory to work out their own rivalry.

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