LONG considered the backyard of the United States, Latin America is increasingly falling under the spell of a rising new global power half a world away.

Hungry for raw materials to feed its economic boom, China is gobbling up virtually everything it can get its hands on in Latin America, from oil and copper to soya beans and sugar.

“We used to say ‘the Russians are coming’. We will now need to admit the Chinese have arrived,” says Manuel Rocha, a retired ambassador to the United States and now head of the Globis Group, a Miami-based business development company.

In the past five years China’s trade with Latin America has grown at an annual rate of 42 per cent, reaching nearly $22 billion (£12 billion) last year. Latin America is also attracting new Chinese investments, mostly directed at securing natural resources, such as Venezuelan oil and natural gas.

“As China’s economy is growing so rapidly, it needs more input of resources and raw materials. Latin America has the right partners China can rely on,” says Professor Jiang Shixue, a Latin America expert at the Chinese Academy of Social Sciences.

However, some experts have given warning that cheap Chinese imports could overwhelm more expensive local manufacturers. With its low labour costs and numerous government subsidies, Chinese toys, clothing and appliances are displacing Mexican and Central American factories in sales to the lucrative US market.

Mexico, for example, lost some 300,000 assembly plant jobs in 2002 and 2003, despite its free trade status with the US. Some countries have responded with heavy tariffs on Chinese imports. But exports to China are also providing the region with a lifeline at a time of declining US foreign investment in the region, helping to keep alive the mining industry as well as providing foreign currency to service foreign debt.

Ever since the 1823 Monroe Doctrine asserted the United States’ claim to the region over European colonial interests, the US has held enormous political and economic weight in the region.

But, according to Rocha, US multinationals that were once deeply involved in Latin America are more focused these days on high-tech business ties with Asia. US foreign policy concerns in the Middle East have also distracted US attention from the region. China has stepped into that vacuum.

The economic relationship dates back to 1990, when former President Yang Shangkun visited Latin America. His trip was the first of several high-level missions, with visits intensifying in the past five years. In April 2001, Jiang Zemin, then President of China, presided over a 12-day mission to cement economic and trade ties.

In 2004, over a period of only two months, the Chinese President, Hu Jintao, and Zeng Qinghong, the Vice-President, visited Latin America separately.

President Hu made a second trip in September last year. Other senior Chinese leaders, including Jia Qinglin, the Communist Party chairman, also visited the region last year.

“The frequency of these high-level visits is unprecedented in China’s foreign diplomacy. It clearly shows that China has attached greater importance to Latin America,” wrote Professor Shixue in a recent article published in the United States.

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