The Politics of Latin America’s Investment and Other Links with China

There are three positions about the impact of outward foreign direct investment (FDI) from China on the policies of Latin American and Caribbean (LAC) countries: the “Wealth is Power” camp, which associates political power with Chinese economic lures; the “Conditionalist” camp, which contends the international and domestic economic and political context determines the specific political effect of Chinese outward FDI (OFDI); and the “Politics is Power” camp, which believes no dramatic political changes have resulted from the economic stimuli of Chinese OFDI (COFDI) and associated economic lures. Case studies herein on Brazil and China, Argentina and China, Ecuador and China, and the Caribbean and China support the Conditionalist camp, albeit to differing degrees and for different reasons. Case studies herein on COFDI in Argentina and in Colombia also deepen our knowledge about the drivers of COFDI. They challenge those asserting that COFDI in LAC is driven purely by political motives. This piece also reviews and critiques the state of the literature on COFDI in LAC and suggests a pathway for moving to the next level. It specifically recommends researchers work to cumulate knowledge by asking similar kinds of questions across cases, exploit theory, and work on variable conceptualization and operationalization.

This article originally appeared in the Journal of Chinese Political Science, Vol. 24, No. 4 (December 2019), pp. 565-582. Copyright remains with the original holder.