Chinese (and Russian) influence in South America – with Marcos Falcone
What does growing Chinese (and Russian) influence mean for South America’s political and economic future? How are governments in the […]
What does growing Chinese (and Russian) influence mean for South America’s political and economic future? How are governments in the […]
What does growing Chinese (and Russian) influence mean for South America’s political and economic future? How are governments in the region responding to pressure from Beijing? And what role do tools like the Confucius Institutes and media influence play in shaping public opinion?
Ricardo Silvestre (Movimento Liberal Social) welcomes Marcos Falcone, Research Fellow at Fundación Libertad, and an Associate Professor at Universidad del CEMA. They talk about how authoritarian regimes are extending their reach in Latin America. Tune in for a conversation that uncovers the influence of China, but also of Russia, in South America, both at the economic, political, and societal level.
This podcast is produced by the European Liberal Forum in collaboration with Movimento Liberal Social and Fundacja Liberté!, with the financial support of the European Parliament. Neither the European Parliament nor the European Liberal Forum are responsible for the content or for any use that be made of.
Show notes
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Find here the book mentioned in the conversation, published at RELIAL on China in Latin America, including Marcos article on the Confucius Institute. You can also read his main argument in this article.
Welcome to the Liberal Europe podcast. I’m your host, Ricardo Silvestre, and thank you so much for listening to today’s episode. And for this conversation, I’m very happy to be joined by Marcos Falcone.
Marcos is a political scientist, a research fellow at Fundación Libertad, and an associate professor at the Universidad del SEMA. He has an extensive work done on the influence of China in South America, which is going to be the focus of our conversation today. We’re going to go into the effects of China’s presence in countries like Argentina, Chile, or Paraguay, both at the economic, political, and even diplomatic levels.
And after our main conversation, please stay to hear a little more about the work done by Marcos and Fundación Libertad. But for now, without further ado, I bring you Marcos Falcone. I’m here with Marcos Falcone.
Marcos, thank you so much for coming to the podcast. Thank you, Ricardo. Thank you for the invitation.
I like the way you say my name, Ricardo. You being from Argentina, you get my Portuguese correctly. Of course.
I mean, I try to get as close as I can to pronouncing all kinds of words correctly, provided that I know the language or that I am at least, you know, somewhat familiar with the language. Let’s start with the main conversation that we’re going to have, which is Chinese influence in Latin America. And also we’re going to extend that to Russian influence.
Put us a little bit on a baseline. Where are things in Argentina, all the countries around it? What are you seeing right now? Right. So this is a very interesting topic, Ricardo.
Thank you for asking. It’s a pretty new one compared to topics that we’re used to discussing in international terms in recent years, because China has become Latin America’s second largest trading partner and South America’s main trading partner, actually. So China is only behind the U.S. in terms of Latin America.
And this is because of the heavy influence that the U.S. has still on Central America and Mexico in particular. So what used to be an American hegemony, if you will, in the Americas is now over or is at least disputed by China, right? Because what matters is the tendency. China is increasingly present in Latin America, whereas the U.S. seems to be retreating not just from Latin America, but from the world in general.
So China is buying lots of stuff from Latin America. It is also selling lots of goods, usually manufactured goods, to Latin America. It is also increasing the number of investments usually done through companies that are state owned or at least partially state owned or that can be private but are ultimately subject to all kinds of interventions by the Chinese government, by the Chinese Communist Party.
But China’s influence in Latin America is not just economic, but it is also political and cultural. I studied the case of the Confucius Institutes a few years ago in a book that we published alongside Redial, which is Red Liberal de América Latina. You’ll post the link to it afterwards.
And I found that Confucius Institutes, unlike other language institutes in the world, have teachers that are trained to suppress issues, issues that are controversial in China. And this is a pattern that you see not just across Confucius Institutes, but also across all sorts of messages that come from China and the way that China shapes public discourse in the media, for example, in newspapers, in TV channels. China has a policy we can deem of implicit authoritarian propaganda, by means of which China avoids certain topics and pressures political actors, economic actors, cultural actors, to not discuss these issues.
And these issues include, for example, well, of course, the lack of democracy in China, human rights violations, the West, particularly in the West of China, towards ethnic and religious minorities. The recent protests in Hong Kong, where people are protesting in favor of democracy and where people should be getting democracy based on the agreement that China signed with the UK 25 years ago. And also, more generally, the fact that China promotes a vision of the world where liberty doesn’t matter, where democracy doesn’t matter.
So in terms of political influence of China in Latin America, what we also see is that China is trying to lure politicians from all across the political spectrum, not just the left, but also the right and the center. And China invites politicians, also journalists, to go to China, fly first class, go to five star hotels, tour China, see the lights of China, and then return to their home countries and become sort of informal agents of the Chinese Communist Party in their countries. And we are seeing that they are very successful to that degree because Chinese diplomacy has a very strong hold of these people and can intervene and ask for help whenever China is in trouble.
For example, whenever there is a conflict between China and Taiwan, we have to remember that China pressures all countries in Latin America and the world to not recognize Taiwan and to force countries to break with Taiwan if they want to have any sort of relationship with China, because of the one China policy. So economic, political, cultural influence is increasing of China in Latin America. We don’t see that Latin American elites are concerned about this, and this is certainly a problem because China doesn’t care about democracy, freedom, the rule of law, even private property, because China, and I’ll sum this up so we can move forward and not be too long, but China has certain laws that force Chinese individuals and companies operating abroad to collaborate with government, with government requests, without any sort of intermediation.
In a country like Portugal or Argentina or any Western country, we would usually expect requests by governments to be resisted and for these matters to go to court and for judges to decide based on laws. This is not what happens in China. If China wants to do something with their companies, with what they consider their companies, their individuals, Chinese individuals, Chinese nationals are at will of the Communist Party in China.
And we can’t even talk about private property in China because the government has access to everything if it wants. The fact that China does not share such fundamental values that we have in the West is very concerning as long as this influence keeps growing. That kind of whitewashing of what China was historical, and for example, we know that everything that has to do with Tiananmen Square is scrubbed from Chinese servers and from Chinese access to the internet.
And now you’re mentioning a current, more current situations like the Uyghur population or Taiwan or Hong Kong. But my question to you is, apart from organizations like the Confucius Institute that is trying to do this as a cultural, more of a cultural phenomenon, do you see that also when it relates to economic and political effects? So do you see the Chinese doing that effort of cleaning up their image, even if they’re dealing with theoretically sophisticated agents, either economic or political agents that know exactly what’s happening? So that’s a good question. I think economically, China is so overwhelming that there are no countries that can pose any threat to China, really.
And it is, you know, and this is Latin America’s own fault, right, when the economy is weak and you need… Marcos, let me just interrupt because in Portugal, we have the same, exactly the same kind of pressure. Yes. Right.
But I mean, when the economy goes bankrupt, and when the state needs money, and they don’t have any money, and they can’t go to the markets, for example, to debt markets, because they don’t trust you, you know, as has been the case in Argentina for many years. The fact that China can just, you know, come in and say, you know, I will lend you money when nobody else will, is very tempting, right? Argentina is an extreme case compared to other countries. But all across Latin America, what you see is that, you know, we need investments.
We need money. We are not doing that well, and China has that money to offer. And so in the case of the Confucius Institutes, for example, the way that China operates is they found different chapters of the Confucius Institute in public universities in different Latin American countries.
And what they do is they offer Confucius Institute services basically for free. They say, we’ll bring the teachers, we’ll build the infrastructure that you need. We will supply you with, well, grants, for example, to study China, to study in China also, to go to China, you know, both students and teachers can travel, visit China for free.
And what do universities say? Yeah, let’s do this. Because usually, you know, universities are deprived of money. They need money.
They would love to have, you know, all sorts of language institutes. They can’t have that because they don’t have the money to do that. And so China comes in, you know, and it is so overwhelming that there’s no way to resist that, right? Which is in some ways similar to what’s happened in Africa and also some Asian countries, right? Like Sri Lanka, where we have seen what dependence can lead to, which is very dangerous.
Politically, I would say that China operates through its embassies. I was in Paraguay a few weeks ago, because we host, I was invited to a conference on China, which of course could be done in Paraguay, because Paraguay is the only South American country that recognizes Taiwan. And so it is the only country where we’re really free to speak, you know, our minds about China.
And so I went to Paraguay and I was on a panel alongside a Bolivian senator that traveled to Taiwan last year. And before she went to Taiwan, she received a phone call by the Chinese ambassador to Bolivia who told her she couldn’t go. And she was like, how can you be telling me this? How can you be giving me orders? You will not give me any orders.
I will go to Taiwan if I want to. But the Chinese ambassador was threatening, you know, with, for example, economic consequences. China and Bolivia have this special relationship that could be over if suddenly, you know, Bolivian public officials start recognizing Taiwan or flirting with Taiwan.
Another example I can give you is, for example, when protests broke out in Hong Kong in 2019, the Chilean parliament tried to pass, well, someone at the Chilean parliament tried to pass a resolution of disapproval, right, because this was wrong. You know, China was using violence against their own people and those people were protesting for democracy. And so when the Chinese embassy found out about this in Chile, they started calling one by one all of the parliamentarians who had been invited to go to China and who had been to China, you know, on state sponsored travels, basically.
And they started telling them, you know, this resolution is a very bad idea. You shouldn’t be doing this. We want to help you.
And so what ended up happening was that this initiative never came to light. It was no longer possible to criticize China on the Chilean parliament. And so China was successful.
And so what I see is that China is operating mostly through its embassies to pressure politicians into adopting China friendly policies, if you will. So if I can sum it up, then we’re looking at a multi-pronged strategy from whitewashing and trying to be as a good partner as it is possible to bullying, like you just explained, and then to just economic might. They come and they say, we can we can save your economy.
We can help building this or building that. And you don’t have any other choice. Now, I had another follow up before moving to talking about Russian influence, which is, is there safeguard systems in a country like Argentina or other countries in the region where Chinese, they lend money or they can like give money to build some kind of infrastructure or provide some kind of service? And then if there’s no capability of paying for that loan, then the Chinese government say, all right, then we’ll take this, this and that, which we see happening in Africa a lot.
Is that also happening in your region of the globe? So that hasn’t happened yet, but it is a concern. I think it could happen because we have no safeguards and because the kind of investments that China has done in Africa are very similar to the ones that they’re doing in Latin America. They bundle investments.
Right. So they say, you know, we’ll build this dam and we’ll build this bridge and we’ll build this factory. And if you fail to repay your debt for any of the three, we’ll take all three.
Right. We’ve seen this happen. This could happen in Latin America, too.
And it is also the reason why in a country like mine, for example, in Argentina, you see politicians sort of being held hostage by China already, because if you look at Javier Millet’s rhetoric before he became president on China, he was very harsh. He was very critical. But once he became president, then he started, you know, being more vague, if you will, in his rhetoric, because, of course, Argentina owes money to China.
It needs to repay its debt or, you know, push it to the future if possible. And that is what the Millet government has been trying to do. Right.
And so that has meant that Millet needs to be more cautious about what he says about China. So I am I’m very concerned that this this problematic that these problems that we saw in Africa and in Asia will repeat themselves in Argentina and other Latin American countries, because there are really no safeguards in terms of, you know, constitutions or regular laws. I once talked to a representative from the opposition in Argentina, a congresswoman who was who was active at the time that Argentina signed an agreement with China to lend China a part of its territory for the Chinese to install a base, which they claim is a space base in the south of the country, in Patagonia.
And what she told me was that even though she was a congresswoman back then and they were discussing the issue in Congress, the then government by Christina Kirchner would not give them the full agreement for them to study. So we know we’re very certain that there are secret clauses to that agreement. So clearly there is there’s no transparency, there are no safeguards.
And so we are in danger, certainly. Now, let’s move to another influencer in this particular with Russia, with this information, with propaganda also relating to exactly the needs that Russia has and the need to find allies all over the globe regarding, for example, what they’re doing in Ukraine or their human rights also issues. So tell us.
The similarities and the difference between Chinese and Russian influence in South America. Yeah, so Russian influence is less subtle, also less important, we have to say this because the Russians are not doing well economically, they don’t have the resources that the Chinese have to influence other countries. But what I would say is their influence is less subtle, their propaganda is more violent, more aggressive, more easily noticeable, although they do try to conceal themselves sometimes.
And so what they have been focusing on in recent years has been the media mostly right through Russia Today, which they then rebranded as RT, the Sputnik agency. They have been trying to push their narrative, particularly of the Russian invasion of Ukraine, right, which I have to say, I think Russia’s invasion of Ukraine has even further discredited Russia in the minds of the Latin American public, because we have many sources of information, and we know what’s going on in Ukraine. And the Russians have not been successful in in manipulating, I believe, public opinion in Latin America.
But they have been focusing more on the media. The one way that they try to conceal themselves is that they set up the Sputnik agency and they pretend to be objective journalists by reaching out to the usually smaller media, local media that cannot have any independent foreign coverage. And they offer their articles to these media outlets who will take them because they’re usually free or much less expensive than reputed foreign agencies.
And so in that way, they try to spread the Russian narrative across the media. But because they have been doing so poorly economically, I think the presence of Russia has diminished lately. They have tried to influence countries like Argentina by sending out vaccines, for example, in the COVID-19 pandemic.
But they only sent out the first doses of the Sputnik vaccine. They never sent the second ones. And so even that sort of operation failed because of how poorly they’re doing right now.
I will put all links to the work on the podcast show notes. I’ve been talking with Marcos Falcone, he’s a political scientist and research fellow at Fundación Libertad. Marcos, this was very, very interesting.
And please come back soon so that we can continue this conversation. Thank you, Ricardo. Thank you for the invitation.
Now, on this last minute that we have together, I really want you to go into the work that Fundación Libertad does in Argentina. So please tell us a little bit, what is the major work that you and the foundation do? Yeah, so Fundación Libertad is Argentina’s oldest classical liberal think tank, classical liberal slash libertarian think tank, depending on the language that we’re speaking. We have been active since 1988.
And this is a foundation that is based not in Buenos Aires, but in Rosario. So not in the center, in the political economic center of Argentina, but in what we call the interior. Right.
Which means that Fundación Libertad is actively pushing for, well, of course, more economic freedom and a more open economy, deregulation, not just at the federal level, but also at the state level, at the provincial level, the municipal level. And what we have been doing in past years is we have been trying to get politicians together and convince them of the benefits of having a market economy, because thankfully, in terms of social and civil liberties, Argentina has done pretty well in recent years. So the one big problem that we have is economic.
And what we try to do with our projects, with reports that we release based on provincial data or federal data with recommendations or projects that have to do with economic education, for example, we just launched a documentary in Spanish last month titled La Solución del Mercado, which is our way of trying to educate the public into the benefits of economic freedom. What we try to do is we try to make Argentina a more liberal country, a freer country, a country that resembles the great country that Argentina used to be about 100 years ago. Right.
A free and prosperous Argentina. And so we were very glad to see that President Millet is trying to open up the economy. We know that there are many challenges along the way.
We try to help. We will try to suggest ways in which we can improve. We’re constantly looking at areas where further deregulation can be done, where taxes can be lowered, where fiscal spending can be further slashed.
And we will not stop because the starting point for Argentina is pretty bad or was pretty bad. We were on the verge of hyperinflation. So we have a lot of work to do.
The Millet presidency will not be enough to solve the problems that Argentina has, the economic issues that Argentina has. And so we will be here pushing for economic freedom for years to come, for sure. This is all for now.
I’ll be back soon with more podcasts. You can always visit the website liberalforum.eu to know more about the activities of the European Liberal Forum. So until the next episode, let’s keep making the world a better place.
You are listening to the Liberal Europe podcast by the European Liberal Forum. This podcast was co-financed by the European Parliament.