Over the past quarter-century, China has rapidly evolved from a minor trading partner to a dominant economic force in Latin America, now second only to the United States in the region and South America’s top trade partner. This surge is largely driven by China’s Belt and Road Initiative, which has enabled massive investments in infrastructure and trade routes across Latin America. With these economic ties, China has secured not only vast markets for its goods but also increasing influence in the political and economic arenas of emerging economies.

Beyond trade, China has become a crucial lender in Latin America, funneling billions into energy and infrastructure projects—often repaid with commodities like oil. Venezuela, for instance, has received nearly $60 billion in Chinese loans, highlighting Beijing’s strategic approach to securing energy resources. In addition, China has targeted the “lithium triangle” of Argentina, Chile, and Bolivia, making significant investments in clean energy supply chains, while the U.S. has struggled to forge similarly strong economic alliances in the region.

This growing alliance has geopolitical implications. China’s expanding influence is seen as a counterbalance to U.S. power in the Western Hemisphere, with authoritarian governments in Cuba, Nicaragua, and Venezuela increasingly turning to Beijing. U.S. officials warn this may undermine democratic institutions. Furthermore, China’s diplomacy—tied closely to its One China policy—has eroded Latin American support for Taiwan, shrinking the number of regional countries recognizing its sovereignty.

Globally, China’s strategy is not limited to Latin America. It is positioning itself as a clean energy powerhouse, seizing opportunities left by U.S. retreat from climate financing and renewable energy initiatives. As the U.S. pivots away from climate policy—particularly under the Trump administration—China fills the vacuum, securing deals and expanding soft power across the Global South. Experts warn that reversing Biden-era climate investments could cost the U.S. tens of billions in lost exports and manufacturing, while allowing China to dominate the global clean energy race.