Since enduring colonization by the Spanish and Portuguese and neocolonialism under United States capitalism-hungry policies, Latin American countries have been objectified for their material resources for centuries. The 21st century has seen a shift in investment and attention to another global superpower as China has stepped in to implement numerous foreign direct investment (FDI) infrastructure projects. As US government agencies and think tanks express concern regarding China’s investment trends, Latin American countries now face the unique situation of being the point of political and economic competition between the eagle and the dragon. So that Latin American countries can best understand how investment strategies affect them, they must first recognize the potential relationships that the US and China display in their investment strategies. This matter of FDI relationship gives rise to the question: does US FDI reactively follow Chinese FDI in Latin American countries? This article compiles data from the US Bureau of Economic Analysis, the Inter-American Dialogue and Boston University Global Development Policy Center, and other sources in an analysis of Chinese and US government FDI in Latin America as a region and in individual countries from 2007 to 2023. Through statistical analysis of US direct investment positions abroad and loans from China's development finance institutions, I test the data for correlation between US changes in FDI levels in relation to previous Chinese FDI trends. While research is ongoing as I conclude the statistical analysis process, I hypothesize that US FDI trends will follow Chinese FDI increases and decreases in the region due to US-China political tensions and the question of future hegemonic power in Latin America. With this data, Latin American countries could exploit FDI patterns to negotiate improved FDI deals and gain traction on the world stage.
The Eagle and the Dragon: US and Chinese Foreign Direct Investment in Latin America
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