Is China’s Increased Investment Elevating Latin America’s Risk Profile?
Abstract
Economic initiatives within the Latin America region over the past two decades have led to a dramatic increase in investment from China, particularly within critical industries such as energy, infrastructure, telecommunications and healthcare. China’s Belt and Road Initiative (“BRI”) and more recently the Covid-19 pandemic response have dramatically increased China’s influence in the region, overtaking that of the United States on a trade value basis. While this investment has helped advance certain economic objectives, the large influx of money has arguably increased an already elevated risk profile for companies operating in the region. Latin American has long struggled containing corruption, as evidenced by having some of largest corruption scandals in history occurring in the region. Add an infusion of business coming from China, a country with its own established record of corruption issues, into the mix, and it is unsurprising that issues are starting to emerge.
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