03-05 LAC

During my active years in the 1970s and 1980s with the International Small Business Congress, I became friendly with senior officials of the World Bank and the International Monetary Fund. They were investment banks linked to the United States, that followed strict guidelines before lending to developing nations.
So, it is not a surprise that they did not make the necessary loans to nations in what is called the LAC, or Latin America and the Caribbean. So many of these countries lacked good governance, did not adhere to the rule of law and were fundamentally corrupt.
Now, along comes China with enormous resources for lending capital to these nations for building infrastructure like ports, railways and highways. Of course, the goal for China is accessing the nations resources and creating future markets for Chinese goods. Like building roads in Brazil to facilitate the export of Soy to China.
There is one huge investment that I can identify with in Jamaica. And that is a Chinese financed railway, called the Beijing Highway, from Kingston to the resort area of Ocho Rios. The photo shows the Chinese Ambassador talking to a Jamaican official.
When my wife and I holidayed in Ocho Rios, it was a two-hour drive to Kingston. Now it will be a 50-minute train ride.
And along with the financing of the new railway, China is planning to build four luxury resorts along the way. It seems that another country in the middle of what the US calls its sphere of influence is moving into the Chinese orbit.
Looking at Latin America and the Caribbean as a whole, China plans to invest $200 billion in infrastructure and build two-way trade in the order of $500 billion. It’s about container terminals in Mexico, ports in the Bahamas, and major investments in Bolivia, Brazil, Venezuela and Cuba.
If you monitor what’s going on, the evidence of China’s influence in the area is the reality that nations like El Salvador, Panama and the Dominican Republic have cut off ties with Taiwan.
And what is also of interest when you follow China’s investment trail is that it is undertaken without any worry about the local environment or disruptions of the local population.
If these investments were made by US corporations, they would be subject to all kinds of scrutiny by social activists and environmentalists back home.
The only question is whether these massive investments are solid economic investments or just strategic political initiatives of the Communist Party in China.