The People’s Republic of China has become a significant political and economic force in Latin America and the Caribbean, and engagement with Beijing frequently means more compromise than partnership. This report focuses on Panama and Ecuador, two small but strategically important nations in the region where China has held out the promise of economic benefits in exchange for support for its global ambitions. The report discusses the pragmatic implications of this situation and offers recommendations for Latin American and US policymakers.
Summary
- Panama and Ecuador exemplify Latin American countries’ eagerness to collaborate with China on significant economic projects. That enthusiasm often leads to short-term thinking and an overdependence on China.
- Partnerships with Panama and Ecuador serve China’s broader regional strategy of cultivating bilateral trade and personal relationships with local elites to further Beijing’s geopolitical goals.
- Since 2017, Panama’s policy toward China has been opportunistic and unpredictable, first pivoting toward Beijing, then scaling back agreements with China before coming full circle and restarting trade talks.
- Ecuador’s ties to China have deepened, albeit sporadically, over the past 17 years, while its relationship with the United States has fluctuated, often driven by political changes in Ecuador as well as evolving US policies and priorities.
- To safeguard their long-term economic interests, Panama and Ecuador should update and upgrade their China-related geostrategic knowledge and move away from business-centric approaches.
- Policymakers in the United States and Latin America and the Caribbean should engage proactively with one another, fostering a balanced international stance to support long-term growth and stability.
About the Report
This report examines China’s growing influence in Panama and Ecuador, both of which display short-term decision-making in their eagerness to develop partnerships with Beijing. It draws upon research conducted in 2022 in both Panama and Ecuador, including participatory workshops and interviews with government officials, former diplomats, and members of civil society knowledgeable about their countries’ diplomatic relations with China. The report was commissioned by the China program at the United States Institute of Peace.
About the Authors
Alvaro Mendez directs the Global South Unit at the London School of Economics and Political Science (LSE). He teaches international relations at LSE, Sciences Po Paris, and Fudan University in Shanghai. Chris Alden teaches international relations at LSE and is the director of LSE’s foreign policy think tank, LSE IDEAS. He is also a research associate with the South African Institute of International Affairs.