HEARING ON CHINA IN LATIN AMERICA AND THE CARIBBEAN HEARING BEFORE THE U.S.-CHINA ECONOMIC AND SECURITY REVIEW COMMISSION ONE HUNDRED SEVENTEENTH CONGRESS FIRST SESSION THURSDAY, MAY 20, 2021 Printed for use of the United States-China Economic and Security Review Commission Available via the World Wide Web: www.uscc.gov UNITED STATES-CHINA ECONOMIC AND SECURITY REVIEW COMMISSION WASHINGTON: 2021 U.S.-CHINA ECONOMIC AND SECURITY REVIEW COMMISSION CAROLYN BARTHOLOMEW, CHAIRMAN ROBIN CLEVELAND, VICE CHAIRMAN Commissioners: BOB BOROCHOFF DEREK SCISSORS JEFFREY FIEDLER HON. JAMES M. TALENT KIMBERLY GLAS ALEX N. WONG HON. CARTE P. GOODWIN MICHAEL R. WESSEL ROY D. KAMPHAUSEN The Commission was created on October 30, 2000 by the Floyd D. Spence National Defense Authorization Act of 2001, Pub. L. No. 106–398 (codified at 22 U.S.C. § 7002), as amended by: The Treasury and General Government Appropriations Act, 2002, Pub. L. No. 107–67 (Nov. 12, 2001) (regarding employment status of staff and changing annual report due date from March to June); The Consolidated Appropriations Resolution, 2003, Pub. L. No. 108–7 (Feb. 20, 2003) (regarding Commission name change, terms of Commissioners, and responsibilities of the Commission); The Science, State, Justice, Commerce, and Related Agencies Appropriations Act, 2006, Pub. L. No. 109–108 (Nov. 22, 2005) (regarding responsibilities of the Commission and applicability of FACA); The Consolidated Appropriations Act, 2008, Pub. L. No. 110–161 (Dec. 26, 2007) (regarding submission of accounting reports; printing and binding; compensation for the executive director; changing annual report due date from June to December; and travel by members of the Commission and its staff); The Carl Levin and Howard P. ‘‘Buck’’ McKeon National Defense Authorization Act for Fiscal Year 2015, Pub. L. No. 113–291 (Dec. 19, 2014) (regarding responsibilities of the Commission). The Commission’s full charter and statutory mandate are available online at: https://www.uscc.gov/charter. i CONTENTS THURSDAY, MAY 20, 2021 HEARING ON CHINA IN LATIN AMERICA AND THE CARIBBEAN Opening Statement of Chairman Carolyn Bartholomew (Hearing Co-Chair) .........................................................................................................1 Prepared Statement ...........................................................................................................3 Opening Statement of Commissioner Derek Scissors (Hearing Co-Chair) .........................................................................................................5 Panel I: China’s Strategic Approach in Latin America and the Caribbean Panel I Introduction by Chairman Carolyn Bartholomew (Hearing Co-Chair) .........................................................................................................6 Statement of R. Evan Ellis Research Professor of Latin American Studies, U.S. Army War College Strategic Studies Institute ................................................................................................................7 Prepared Statement .........................................................................................................10 Statement of Margaret Myers Director of the Asia and Latin America Program, Inter-American Dialogue ................41 Prepared Statement .........................................................................................................44 Statement of Ryan Berg Senior Fellow, Americas Program, Center for Strategic and International Studies .......57 Prepared Statement .........................................................................................................60 Panel I: Question and Answer............................................................................................74 Panel II: China’s Economic Engagement in Latin America and the Caribbean Panel II Introduction by Commissioner Derek Scissors (Hearing Co-Chair) .......................................................................................................91 Statement of Rebecca Ray Senior Academic Researcher, Boston University Global Development Policy Center ........................................................................................................................................92 Prepared Statement .........................................................................................................94 Statement of Mitch Hayes Founder, “The China Signal” and “Mundo” ................................................................115 Prepared Statement .......................................................................................................118 ii Statement of Francisco Urdinez Associate Professor, Institute of Political Science, Pontificia Universidad Católica de Chile .............................................................................................................................133 Prepared Statement .......................................................................................................135 Panel II: Question and Answer ........................................................................................148 Panel III: China’s Military and Security Activities in Latin America and the Caribbean Panel III Introduction by Chairman Carolyn Bartholomew (Hearing Co-Chair) .....................................................................................................162 Statement of Cynthia Watson Dean of Faculty and Academic Programs, National War College ...............................163 Statement of Thiago de Aragão Director of Strategy, Arko Advice Public Affairs; Senior Researcher, Center for Strategic and International Studies ...............................................................................165 Prepared Statement .......................................................................................................167 Panel III: Question and Answer ......................................................................................188 Panel IV: Case Studies Panel IV Introduction by Commissioner Derek Scissors (Hearing Co-Chair) .....................................................................................................203 Statement of Rasheed Griffith Head of Operations, Tokamak Labs; Host, China in the Caribbean podcast ..............204 Prepared Statement .......................................................................................................206 Statement of Luis Rubio Chairman, Mexico Evalua ...........................................................................................229 Prepared Statement .......................................................................................................232 Statement of Oliver Della Costa Steunkel Associate Professor, Fundação Getulio Vargas School of International Relations; Nonresident Scholar, Carnegie Endowment for International Peace ...........................246 Prepared Statement .......................................................................................................249 Panel IV: Question and Answer ......................................................................................259 QUESTIONS FOR THE RECORD Responses from R. Evan Ellis Research Professor of Latin American Studies, U.S. Army War College Strategic Studies Institute .............................................................................................................271 Responses from Margaret Myers Director of the Asia and Latin America Program, Inter-American Dialogue ...............274 iii Responses from Ryan Berg Senior Fellow, Americas Program, Center for Strategic and International Studies .....275 Responses from Rebecca Ray Senior Academic Researcher, Boston University Global Development Policy Center ......................................................................................................................................276 Responses from Mitch Hayes Founder, “The China Signal” and “Mundo” ................................................................278 Responses from Francisco Urdinez Associate Professor, Institute of Political Science, Pontificia Universidad Católica de Chile .............................................................................................................................279 Responses from Rasheed Griffith Head of Operations, Tokamak Labs; Host, China in the Caribbean podcast ..............282 Responses from Luis Rubio Chairman, Mexico Evalua ...........................................................................................283 Responses from Oliver Della Costa Steunkel Associate Professor, Fundação Getulio Vargas School of International Relations; Nonresident Scholar, Carnegie Endowment for International Peace ...........................284 iv CHINA IN LATIN AMERICA AND THE CARIBBEAN THURSDAY, MAY 20, 2021 U.S.-CHINA ECONOMIC AND SECURITY REVIEW COMMISSION Washington, D.C. The Commission met in Room 210 of Cannon House Office Building, Washington, DC and via videoconference at 9:30 a.m., Chairman Carolyn Bartholomew and Commissioner Derek Scissors (Hearing Co-Chairs) presiding. OPENING STATEMENT OF CHAIRMAN CAROLYN BARTHOLOMEW HEARING CO-CHAIR CHAIRMAN BARTHOLOMEW: We'll call this hearing to order. Good morning and welcome to the fifth hearing of the U.S. China Economic and Security Review Commission's 2021 Annual Report cycle. Thank you all for joining us, and thank you to our witnesses for the effort they have put into their testimonies and for traveling here. I would like