Companies based in the People’s Republic of China (PRC) have expanded their control over Latin American energy generation, transmission and distribution through acquisition and infrastructure construction. China’s expanding control may be understood as an additional dimension of its Belt and Road Initiative (BRI), a wide-ranging foreign policy strategy in which the PRC employs the combined tools of statecraft, state-directed finance and state-owned or state-subsidized companies to build physical and other networks within the global economy in ways that serve the accumulation of wealth and power by the Chinese state. China’s advances in electricity infrastructure are consistent with, and complementary to, its better-known building and operation of physical infrastructure such as roads, ports and—more recently— “Digital Silk Road” infrastructure such as telecommunications and e-commerce. Such projects generate business for Chinese companies and banks, facilitate access to markets and products and create leverage for the PRC to advance its commercial interests in other areas. Electricity is key to almost every dimension of Latin America’s economy, and will be key to the region’s development of technology-intensive economic growth. China’s ever-expanding position in the sector merits continued vigilance as yet another “double edged” sword of its Belt and Road engagement, facilitating economic activities in the region in ways that ultimately steer global flows of wealth to its advantage.
The Chinese construction of nuclear projects in the region is a relatively recent development, including the experimental Hualong-1 reactor in Argentina’s Atucha complex and a bid to build a new reactor for Brazil’s Angra nuclear complex. Apart from these new energy investments, China has also been involved in fossil fuel-based energy generation in Latin America, including acquisitions of gas-fired power plants in the port of Açu in Brazil by State Power Investment Corporation (SPIC) and work on the Jaguar thermoelectric facility in Guatemala and the Martano gas fired generation facility in Colon, Panama—although the latter two projects are currently suspended. China’s role in electricity generation and transmission in the region allows it to contribute low-cost components and long-term financing for infrastructure expansion, which has arguably played a role in the advance of clean energy and low-cost electricity in general. At the same time, Chinese investments have run into a combination of project difficulties and frequently generated social unrest. In addition, long-term questions about who ultimately benefits from Chinese projects remain, along with growing concerns about the degree of Chinese influence over the region’s business, administrative and political dynamics based on its outsized presence in the energy industry.