With a naval base in Peru, is China trying on a Pacific Monroe Doctrine for size?
 Time has long gone when bandits, adventurers and dreamers saw an idyllic world of escape in South America.
Ever since World War II South America slipped from global consciousness. London and New York papers sent correspondents there from time to time in the '60s, but only found communists making the yards but little of interest otherwise.
That was until the advent of China's president-for-life Xi Jinping, whose domestic changes threatened a chain reaction through world trade. Still, South America did not play much of a role. That was to come later.
Since 1997, when Chinese leader Deng Xiaoping died, having opened up China to world trade, his policies and spirit lived on. Deng's go-ahead spirit - "it's glorious to be rich" - was also embraced by the masses as they ascended to a middle class life. The joke, in those long ago heady days, was that Hong Kong's free market economy was more likely take over Communist China in 2049 than was communism as it was scheduled under the terms of the lapsing decolonizing Joint Declaration with the UK.
But foreseeing this as a negative outcome, President Xi took over Hong Kong in 2020, clamping down on demands for democracy and opening up concentration camps for Muslim reeducation in the Glorious Communist Way.
This was accompanied by a vast military buildup, and a general clampdown on freedoms under which the Deng regime were allowed to flourish.
Fearing what happened to Russia's communist hegemony could happen to China's, President Xi clamped down. While it had the desired effect, that no one made a move without his say so. At the same time, nobody made much of a move to do much of anything, except for state infrastructure megaprojects. Most did little more than keep their noses clean and their heads down.
In the face of public lethargy, cash-rich Beijing engaged in stimulus spending. Those skillful enough to syphon off portions of the stimulus money without ending up in jail, continued to do so. But even friends of the regime saw that China had lost its oomph.
An oomph-less China attracted less foreign direct investment, than the super charged China had done with that the Deng Xiaoping spirit at the helm. Stimulus spending will be repeatedly used because, short of regime change, it is the only tool available to Beijing. The Covid scare dampened the mood still further.
Even if Beijing one could do what one wanted to do within reason, as was done in Hong Kong after the initial crackdown, that was insufficient to lay a foundation to build a future. What assurances that had been given, could be trusted to last in the absence of the rule of law, free speech and an independent judiciary.
So the leadership, finding the domestic affairs fraught with sullen intransigence, has turned to foreign climes where one had a freer hand to do what one wished.
It was the same with Donald Trump's first term in office. He enjoyed a swashbuckling tour of success in foreign affairs. He moved the US Embassy to Jerusalem, struck the Abraham Accords that should have won him a Nobel prize for achieving a measure of Middle East peace, and re-setting North Korea's priorities with little more than a few tut-tuts in opposition.
In like matter, Xi Jinping whose Muslim concentration camps are losing friends in the West, with European and American chambers of commerce in China sounding pessimistic about growth or expansion plans as well as constant talk of de-coupling, reshoring and homeshoring.
So rather like Trump's foray into hassle-free foreign affairs, President Xi seems to have taken that same yellow brick road to peace in quiet in Peru. Whereas Trump's aim was to de-escalate in the Far East, the Mideast and Europe, China's aim seems to replicate something of a Monroe Doctrine for the Pacific.
There have been questions raised whether China controlling a port in Peru violates the 1824 Monroe Doctrine, in which the United States conferred upon itself hegemonic powers over the Americas. But technically speaking, the answer is No for the simple reason that the Monroe Doctrine was only concerned with the expansion of European powers, when China was partially colonised itself and far from being the transoceanic power it has since become.
Still South America represents a relatively new market for the output of its factories and a sources of agricultural produce of what it needs. In some respects it is a marriage made in heaven, and one not to be lost in avoidable contretemps with the United States.
Such massive shifts in global trading patterns in 2024 have made the task of managing and optimising supply chains even more complex. However challenging, the situation seems manageable without too much stress and strain.
This is perfectly demonstrated on the trade from the Far East to South America East Coast where a record-breaking 1.6 million TEU was shipped in the first nine months of last year – driven by exports from China, which are up 14.8 per cent compared to 2023.
With China seemingly looking to increase exports to regions such as South America just as the US is set to increase import tariffs under a new Trump presidency, 2025 will see further shifts in global trade patterns.
Shippers need to be able to take data-driven decisions to keep supply chains moving while also managing freight spending.
What emerges is Chinese strategy to impose a Monroe-like doctrine and apply its naval assets in such a way as to block any subject nation's trade with either America and/or Europe. Thus, if China's domestic policies become so distasteful to Europe and North American, resulting in reshoring to ASEAN trading bloc Beijing will have the blue water navy to curb what trade it finds objectionable.
And would an America, tiring of foreign wars, find refuge in righteous isolationism? It depends on how each side behaves in maintaining the status quo. |
