RPT-BREAKINGVIEWS-US Venezuela attack complicates Beijing LatAm push

By Ka Sing Chan

HONG KONG, Jan 7 (Reuters Breakingviews) - For Latin America’s leaders, Washington's snatching of the Venezuelan president will make deepening ties with Beijing both more appealing and more fraught.

Nicolas Maduro was, in his own words, "kidnapped" by U.S. troops just hours after meeting a special envoy from China -- and only weeks after the world's two biggest economies unveiled competing visions for the region. U.S. President Donald Trump desires a Western Hemisphere “free of hostile foreign incursion or ownership of key assets” while President Xi Jinping is pitching China as a development partner to Latin America and the Caribbean.

There's a lot at stake. Though it imports less than 1% of its oil from Caracas, Caijing magazine reported this week, citing customs data. China's ties to the region are significant and growing. The bloc comprised at least 8% of China's overseas trade in 2024 including key products like BYD 002594.SZ and Chery Automobile 9973.HK electric vehicles. It is also a pillar of Beijing’s push to diversify its suppliers of crucial materials and food including crude, minerals and soybeans.

China has been channeling development finance to mining projects or infrastructure - two sectors both underinvested. In the process, it has become one of the region's top creditors. By late 2024, the state-run China Development Bank reported providing $160 billion in financing to 21 countries across Latin America.

Chinese credit lines have financed projects such as the $3.5 billion deepwater megaport in Chile’s Chancay, which counts Chinese shipping major Cosco as a key investor. Since 2018, some 22 Latin American countries have joined Xi’s signature Belt-and-Road infrastructure initiative. And after Trump launched his tariff war last year, Xi responded by pledging even more investment and development support.

Much of this spending ultimately underpins trade with China, but Beijing may also have hoped its financial largesse would help it to further isolate Taiwan, the democratically governed island China claims as its own: After all, Latin America is home to seven of the 12 countries that still maintain diplomatic ties with Taipei.

Venezuela was supposed to be one of China's select "all-weather strategic partners", alongside Pakistan and Belarus b ut Maduro’s fortunes underscores the limits of Beijing's influence. With the prospect of U.S. military abduction now a tangible risk, China may need to offer Latin American leaders far more incentives to persuade them to keep open their markets and welcome deeper Chinese investment.

CONTEXT NEWS

China's top diplomat Wang Yi on January 4 accused the U.S. of acting like a "world judge" by seizing Venezuela's leader Nicolás Maduro to put him on trial in New York, with Beijing later confronting Washington at the United Nations over the move's legality.

On January 2, Nicolás Maduro had received a delegation of Chinese diplomats, led by Chinese President Xi Jinping’s special envoy for Latin America. The meeting happened just hours before U.S. special forces removed the Venezuelan president.

On December 4, Washington published its 2025 National Security Strategy, which calls for a “Trump Corollary” to the Monroe Doctrine and a Western Hemisphere “free of hostile foreign incursion or ownership of key assets”.

On December 10, China’s foreign ministry published a policy paper on Latin America and the Caribbean, proposing initiatives for building a "China-LAC community with a shared future".