"Investing in the Pan Amazon: How China’s investment operates" 4 October 2023

The increasing presence of Chinese companies in South America has become an issue of concern among social and political analysts... Environmental advocates attest that companies from China are uninterested in sustainability and will maximise profits at the expense of biodiversity and ecosystem services...

Investment from China falls into two major categories: loans to finance infrastructure and direct foreign investment (DFI) by corporations that seek to own or operate a business...

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Ecuador was an early recipient of Chinese investment...In 2006, the China National Petroleum Company (CNPC) and Sinopec created a joint venture, which they used to purchase one of Ecuador’s most valuable infrastructure assets, the Oleoducto de Crudos Pesados (OCP), the pipeline between the Amazon and the Pacific coast, for $US 1.3 billion...Outside the extractive industries, the largest loans were used for the construction of two hydropower facilities in the Andean foothills...

The country has been unable to service its new debt obligations following the decline in the price of oil after 2015. Ecuador was forced to restructure its foreign debt in August 2020...

Bolivia and China have engaged in an unusual infrastructure initiative in the form of a communications satellite, which was designed, built and launched by the Chinese space agency...Proponents argue the investment should not be evaluated solely on financial criteria, however, because it integrates remote Indigenous communities into the national community by providing them with cellular phone service and access to the internet.

Bolivia continues to service its debt, but financial analysts consider Bolivia to have reached a plateau in its ability to service any additional non-concessional debt...

The most heavily indebted country in Latin America is Venezuela. Between 2000 and 2014, the country reportedly borrowed $US 50 billion from Chinese entities to finance multiple components of the national economy, including the hydropower facilities on the Caroni river and industrial mines in Bolivar state....

Peru has welcomed significant quantities of DFI and completely avoided the debt trap that afflicts its neighbors...A more controversial investment is Sinohydro’s participation in the consortium (Sociedad Concesionaria Hidrovía Amazónica SA – COHIDRO)...The controversy surrounding the project stems from accusations the consortium manipulated the bidding process and claims by Indigenous federations that they were not adequately or legally consulted during the environmental review.

In Brazil, Chinese companies have invested more than $US 60 billion since 2005...It includes businesses that specialize in commercial real estate, finance, transportation, telecommunications, agriculture and minerals...

In Guyana, that includes a $950-million contribution to a joint venture between the Chinese National Oil Company (CNOC) and Exxon, a luxury hotel, improved port facilities, and, reportedly, paving the IIRSA-sponsored Letham–Georgetown highway...