- May 20, 2025
While Trump slashes aid, hikes tariffs, China pumps $9.1B into Latin America
The Chinese leader made the announcement at the May 13 summit of the Community of Latin American and Caribbean States (CELAC) in Beijing. The event was attended by the presidents of Brazil, Colombia, Chile and other top officials from about 30 countries.
Xi didn’t mention Trump by name, but he seized the moment to portray China as a more reliable ally and business partner than the United States.
“There are no winners in tariff wars or trade wars,” Xi said in his inaugural speech at the meeting. “Bullying and hegemonic policies only lead to self-isolation.”
He was clearly referring to Trump’s tariff increases ranging from 10% to 25% for Latin American nations amid his overall higher global tariff hikes, as well as the U.S. president’s estimated 83% cuts in global foreign aid programs. Trump has also tightened visitor entry rules as part of his immigration crackdown — and even vowed to “take back” the Panama Canal.
China’s new mega loan to Latin America will allow Chinese companies to increase investments and trade with the region, Xi said. Interestingly, the loan will not be in dollars, but in yuan — part of Xi’s strategy to position China’s currency as a real alternative to the U.S. dollar.
In addition, Xi announced a visa-free entry policy for tourists from Brazil, Argentina, Chile, Peru and Uruguay. Starting June 1, visitors from these countries will be able to visit China for up to 30 days without a visa. The policy may be extended to other Latin American countries later.
Also, China will invite 300 Latin American and Caribbean politicians annually to visit China over the next three years. China’s foreign ministry spokesman Lin Jian predicted a “golden decade” for China-Latin American ties, the South China Morning Post reported.
In an ironic reversal of roles, China’s communist regime is now seen by many countries as a defender of free trade and a rules-based international economic order, while Trump’s America is seen as a reckless, populist economic nationalist country.
Brazil’s left-of-center President Luiz Inacio Lula da Silva said in his CELAC speech that “President Xi Jinping and I advocate for fair trade based on the rules of the World Trade Organization.” He added, echoing Xi’s words, that “trade wars have no winners.”
Granted, China’s inroads into Latin America aren’t new. It’s already the largest export market for several countries in the region, buying much of their soybeans, minerals and other commodities. Total trade between China and Latin America reached a record $500 billion last year, up from $12 billion in 2000.
While China’s investments in the region have mainly been limited to ports, roads and bridges needed to ship commodity exports, they are diversifying into electric cars, renewable energy and artificial intelligence companies.
To be sure, China’s economy is struggling, and its new credit line for Latin America will be less than half of what China announced at the first CELAC meeting in 2015. Nevertheless, it helps China portray itself as a better global citizen than Washington.
Ryan Berg, an expert on China-Latin America relations with the Center for Strategic and International Studies, told me he’s most worried about China’s planned invitations to 300 Latin American politicians a year to showcase “China’s governance model” to the visitors.
“What the hell is that?” Berg told me. “Seems like an attempt to message that autocracy is an OK development model.”
The fact is that while China is offering new loans, investments, free-entry visas and all-expenses-paid visits for Latin American politicians, the Trump administration is pushing nothing but a negative agenda for the region. When Trump talks about Latin America, it’s all about gruesome crimes, drugs and illegal immigration, most often cherry-picking isolated incidents to falsely present them as generalized calamities.
And the U.S. president didn’t make things better when he was asked about Latin America on his first day back in the White House in January, and said, “We don’t need them, they need us.” In fact, the United States needs Latin America to do better, so it can increase trade, investments, and reduce migration.
To be fair, Washington’s neglect of Latin America and China’s rise in the region began about two decades ago, long before Trump’s first presidency. But Trump’s failure to present any constructive plans to improve ties with Latin America has elevated the U.S.’s lack of attention to the region to a whole new level.
If Trump doesn’t come up with a positive agenda for the region, China will fill the vacuum, and the U.S. president will go down in history as the American leader who “lost” Latin America to China.