FT News Briefing US tensions with Latin America are a boon for China
May 20, 2022
Tensions rise as Canada bans Huawei from its 5G network, reflecting growing concerns over Chinese influence in tech. The U.S. struggles to engage Latin America, creating opportunities for China to step in. Meanwhile, the corporate bond market faces turbulence due to rising interest rates and inflation, pushing investors to explore undervalued bonds. As both bond and stock markets decline, shifting focus toward commodities emerges as a strategy against economic uncertainty. The podcast dives into these interconnected global dynamics and investment challenges.
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Declining US Influence
- Several Latin American countries threaten to boycott the Summit of the Americas due to exclusions and lack of a substantive agenda.
- This signals a decline in US influence in the region, contrasting with 1994 when all but Cuba attended.
China's Advantage
- The US offers little to Latin America, often resorting to threats or criticism, while China offers aid, trade, and non-interference.
- This makes China's offer attractive, increasing their influence and trade in the region over the past two decades.
US vs. China in Latin America
- A Latin American diplomat compared the US approach to the region to the Vatican: rule-bound and difficult.
- China's approach, he said, is more like Mormon missionaries: friendly, offering help without judgment.