Latin America: China broadens its reach
The country’s leaders and financiers are looking to build a unique gateway into Latin America.
First Africa, now increasingly central Asia and Latin America. China is stretching its tentacles beyond the likes of Angola and Mozambique and wrapping them around Kazakhstan and Colombia in its quest to secure natural resources and new trade routes.
Last month China and Kazakhstan announced a series of deals worth billions of dollars. These included a $1.7 billion loan to Samruk-Kazyna, Kazakhstan’s national welfare fund, a $5 billion loan for a petrochemicals complex, an agreement for Kazakhstan to supply China with 55,000 tonnes of uranium and an understanding for China to help Kazakhstan build a high-speed railway. The two countries are also working together over water-quality controls for the rivers that flow across their border and in supporting agriculture.
It’s not the first time that China and Kazakhstan have linked up. China helped to finance and build a 1,000 kilometre oil pipeline, which opened in 2007, connecting central Kazakhstan to its north-west frontier. And in 2009 at the peak of the financial crisis China lent $5 billion to KazMunaiGas, the state-owned energy company, in return for future oil supplies.
What the most recent agreements demonstrate are two things. First, that China, not Russia, is fast becoming the most important power in central Asia.