China's influence grows in US' 'backyard'

Not so long ago, Latin America was considered the "backyard" of the United States, but this is now changing. In the past decade China's trade, investment and economic cooperation with the region has increased, challenging the US' position in Latin America.

The US' importance as a market for Latin American goods was so big that there was a time it was said: "When the US economy sneezes, Latin American countries catch a cold." But as China has now become a larger export destination for some Latin American countries, the same can now be said of China. For example, its influence in the Peruvian economy is very big, to the point that Luis Miguel Castilla, Peru's finance minister, has said "the truth is I light a little candle every day and pray that China's growth doesn't fall".

China's emergence as an economic power and its needs for natural resources and food, which Latin American countries have in abundance, means China is now the biggest trade partner of Argentina, Brazil, Chile and Peru. And China has free trade agreements with Chile, Costa Rica and Peru that will enhance that relationship.