China in Latin America
Peru's Transport and Communications Ministry on Sept. 7 signed a contract with Chinese state-owned engineering giant SinoHydro to build the Hidrovía Amazónica, a mega-project aimed at turning the Amazon's major rivers into arteries for delivering the resources of the rainforest basin to foreign markets. Peruvian firm Construcción y Administración SA (CASA) is also to be a partner in the deal, announced earlier this year by the government's foreign investment arm, ProInversión. With a projected cost of $95 million, the Hidrovía calls for dredging 2,687 kilometers of Amazon waterways to make them navigable year-round. It encompasses stretches of the rivers Marañón and Amazonas (from Saramiriza to Santa Rosa), Huallaga (from Yurimaguas to the Marañón) and Ucayali (from Pucallpa to the Marañón). These rivers usually are too low for commercial navigation during the July-October dry season). Proinversión claims to have carried out a "prior consultation" with impacted communities along the rivers, having won 40 agreements to proceed with work. (Gestion, Sept. 7; El Peruano, July 17; BBC Mundo, July 7)
The government of Venezuela, under growing pressure from US sanctions, is telling oil traders that it will no longer receive or send payments in dollars, Dow Jones reported Sept. 13. Oil traders who export Venezuelan crude or import oil products into the country have begun converting their invoices to euros. The state oil company Petróleos de Venezuela SA (PdVSA), has instructed its private joint venture partners to convert existing cash holdings into euros. Plugging the switch, Venezuela-based state media outlet TeleSur writes: "The petrodollar is more important for US global domination than either arms exports or Hollywood culture, because it allows the US to be the biggest exporter of the dollar bills the rest of the world needs to be able to buy oil. Venezuela has decided to start de-dollarizing its economy."
Protests were held outside China's embassy in Quito Aug. 24 following the interception of a Chinese cargo ship with an illegal catch of endangered fish and shark species in Ecuador's Galápagos Marine Reserve. The vessel's crew of 20 went on trial the following day, and could face up to three years in prison as well as monetary penalties ranging in the millions of dollars. The controversy comes as the Galápagos Islands have seen weeks of protest over a newly instated Organic Law of Special Regime for the Province of Galapagos. The new law gives Ecuador's national government greater control over land use and wages on the popular tourist destination. It also gives the Environment Ministry the power to change the borders of Galápagos National Park. Locals say the law opens the way for foreign investment and private encroachment on the National Park, undermining local businesses and potentially devastating unique wildlife. (LAHT, Aug. 25; TeleSur, Aug. 24; Vice, June 28, Galapagos Digital, June 18)
A consortium led by China Three Gorges Corp has agreed to buy a giant hydro-electric plant under construction in Peru from scandal-mired Brazilian company Odebrecht. The Chinese consortium, also including Hubei Energy Group, is reported to be paying $1.39 billion for the Chaglla power plant, which is located on the Río Huallaga in Chaglla and Chinchao districts of Huánuco region. The Chaglla complex has recieved $150 million in funding from the Inter-American Development Bank and Japan's Sumitomo Mitsui Banking Corp. When completed, it will be Peru's third largest hydro-electric facility.
Panama announced June 13 that it is breaking its long-standing diplomatic ties with Taiwan in favor of establishing relations with China—a clear political coup for Beijing. The Panamanian statement said it recognized "only one China" and considers Taiwan to be part of it. The change was spurred by an unavoidable fact: China is the second most important Panama Canal user after the United States. Last year it sent 38 million metric tons of cargo through the interoceanic waterway, accounting for 19% of its traffic. The announcement of the diplomatic switch also comes just as Chinese enterprises began building a container port, with natural gas terminals, in Panama's Colón province, on the Atlantic side of the canal. "I think Dominican Republic and Nicaragua will soon follow," Mexico's former ambassador to China, Jorge Guajardo, tweeted soon after the announcement.
The latest in a series of popular consultas (consultations, or referenda) on local extractive projects took place June 4 in the municipality of Cumaral, Meta department, with residents voting overwhelmingly (7,475-183) to reject oil exploitation within their territory. The Chinese-owned company that hopes to drill in Cumaral, Mansarovar Energy, immediately challenged the legitimacy of the consulta before Colombia's Council of State, the supreme tribunal with jurisdiction over administrative issues. In a surprise ruling just two days after the vote, the Council of State found that the results must be binding. The ruling is still subject to review by Colombia's Constitutional Court. (El Espectador, June 6; Semana, June 5)
Ecuador's government has deployed military drones and police helicopters to the Amazon village of El Tink, where Shuar indigenous residents have for weeks been blocking the only bridge leading to the community, over the Río Zamora. The stand-off began after a confrontation between indigenous protesters and National Police left one police officer dead in December at another Shuar village, Nankints, across the Cordillera del Condor from El Tink. The clash at Nankints came after Shuar warriors reportedly attacked a camp of the Chinese-owned Explorcobres copper exploration project. Nankints residents wanted by authorities in the attack have taken refuge at El Tink, also in Morona Santiago province. Nankints has been in resistance since troops arrived to demolish the settlement to make way for the 41,700-hectare mining project last August. With the stand-off at El Tink, the uprising has spread to a second village. (The Guardian, March 19; Mongabay, Feb. 8; Mongabay, Jan. 26)
Peru's prosecutor general Pablo Sánchez announced Feb. 7 that he is seeking the arrest of former president Alejandro Toledo on charges of laundering assets and influence trafficking. Prosecutors opened a formal investigation this week into allegations that Toledo took $20 million in bribes from Brazilian construction firm Odebrecht, with investigators raiding his home in Lima on Feb 4 and carting off boxes full of documents. Sánchez is now asking a judge to approve 10 months of "preventative detention" for Toledo while the case is under investigation. Toledo is currently believed to be in Paris, where he arrived for an OECD conference last week, and Sánchez argues that he poses a flight risk. Toledo is said to have received the money, laundered through offshore accounts, in exchange for giving the firm approval to complete a highway connecting Brazil with the Peruvian coast in 2006.