The Latin American Development Bank has become the latest battlefield to fight for global influence In the middle of the US “China”, after its leader warned that the lender helped Beijing to strengthen its presence in the region.
Mauricio Claver-Carone is the newly appointed head – Inter-American Bank of AttractionHe said Washington had allowed China to find a foothold in Latin America by lending to lenders for years, turning a blind eye to how Beijing used its institution’s membership to obtain a disproportionate share of contracts.
“For decades, the United States has underestimated the IDB across the political spectrum,” Klaver-Caronen told the Financial Times. “As a result, China has filled that financial vacuum to their advantage. I hope that lesson has been learned now. ”
Founded in 1959, IDB is one of the world’s oldest development banks and is a major player in Latin America, providing nearly $ 13 billion in loans last year. China is one of the 48 members of the Washington-based institution, which joined in 2009. Making it eligible to apply for projects financed by the lender.
Clover-Charon, a former Trump administration official, became a “former Trump administration official” last year. the first American to run the bank after an aggressive campaign backed by Donald Trump and opposed by Joe Biden. He then rushed to the United States to support the institution’s capital increase to offset China’s influence in Latin America.
To substantiate its argument, Claver-Carone cited figures showing that China has won a large number of IDB-financed contracts over the past decade, although it was the bank’s smallest shareholder with a 0.004% stake.
According to the bank, Chinese engineering and construction companies won $ 1.7 billion in IDB-funded contracts between 2010 and 2020, making it the fourth largest recipient of transactions in Brazil, Argentina and Peru.
During the same period, IDB, the largest shareholder in the United States with a 30% stake, won $ 249 million worth of contracts, highlighting how China used its small stakes to expand its presence in Latin America.
Focusing on IDB և China, which has provided billions of dollars in direct loans to countries in the region to finance infrastructure projects, is coming to Beijing և increased control due to its global economic impact in Latin America, Africa and Asia.
Claver-Carone’s push for capital is backed by some high-ranking Democrats, including Senate Foreign Relations Committee Chairman Bob Menendez, but has no general support from party lawmakers.
Menendez told FT that China “exploited IDB” for its own economic gain, adding that the fact that it contributed to a 1% shortfall in IDB core funding raised “serious questions about how China has acted. to become one of the best purchasing partners of the bank. “
The Senate is currently considering a package of Chinese bills that would encourage a thorough study of Chinese economic practices in Latin America, including a provision requiring US intelligence agencies to study how Beijing influences decisions, including IDB, the World Bank and the IMF.
The legislation in question will also allow the Biden administration to require an increase in US-funded IDB funding.
Concerned about the debate, one person said that the Biden administration has an open intention to increase capital until the completion of the IDB study commissioned earlier this year.
Some lawmakers, including Democratic Senate Appropriations Officer Patrick Lee, oppose the increase. But others say the United States needs to do more to counter Beijing.
“As Beijing continues to manipulate vulnerable states through debt-trap diplomacy, we must be vigilant in defending our interests in multilateral institutions such as the IDB,” said Marco Rubio, chief Republican of the FT Senate Intelligence Committee.
Mark Lopez, who represented the US on the IDB Board from 2015 to 2018, said Washington should make some accusations by allowing China to become a major investment player in Latin America.
Lopez added. “The United States has long been concerned about China’s invasion of Latin America, but the countries simply have not had a better offer. The United States has historically underestimated IDB. “
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