This article was published by The Energy Mix on Nov. 26, 2024.
By Christopher Bonasia
China, already a global leader in renewable energy, is poised to fill the gap if Donald Trump follows through on his vow to roll back climate commitments and impose steep tariffs on imports to the United States.
The evolving power dynamic between the two global giants is playing out in resource-rich Latin America, where middling U.S. spending to curb immigration and drug smuggling is overshadowed by China’s multi-billion-dollar investments in economic development.
China’s international climate investments—they dominate solar, wind batteries, and electric vehicles—are strategic and help it build relationships globally, China expert Alex Wang, a law professor at the University of California, Los Angeles, told U.S. National Public Radio (NPR). “They’ve sort of set up a situation where it’s good for them to sell clean energy technologies to the world.”
And selling climate solutions makes China a lot of money, Wang added. “While the U.S. is building about 7 per cent of global wind and solar projects, China is building about 64 per cent.”
In the last few decades, China has also pursued its Belt and Road Initiative (BRI), making huge infrastructure investments to cement economic ties around the world—with significant advances in Africa and South Asia.
The U.S. has taken steps to push back against China’s growing influence, writes the Council on Foreign Relations. Trump passed the BUILD Act during his first term to create a Development Finance Corporation with a US$60-billion portfolio—meant to build infrastructure in low-income countries. President Joe Biden followed with a Build Back Better World (B3W) initiative to compete against China’s BRI. And in the midst of this year’s U.S. presidential election, Brian Deese, an economic adviser to the Kamala Harris campaign and former director of Biden’s National Economic Council, proposed a “Clean Energy Marshall Plan” to “help countries most vulnerable to the effects of climate change” while matching the reach of the BRI.
Still, China’s influence and trade with Latin America continue to expand, with economic activity growing from $12 billion in 2000 to $450 billion in 2023. This month, President Xi Jinping unveiled the first phase of a $3.5-billion port in Peru linking its Pacific coast to China. Biden, in comparison, announced nine Black Hawk helicopters for a $65 million anti-drug program and donated second-hand trains for a metro system, reports the Financial Times.
“It was such a striking contrast,” said Michael Shifter, adjunct professor at Georgetown University. “You have this huge Chinese mega-port project that evoked Peru’s history going back to the Incas and seeking greatness. And then what Biden delivered was some more helicopters for coca eradication. That seems completely outdated and stale.”
In March, a bipartisan group of U.S. senators introduced the Americas Act, styling it as the “only major strategic economic plan to counter China’s growing geopolitical and economic power in the Western Hemisphere,” said law firm Arnold & Porter. The measure is still waiting to be passed.
Now, the balance of U.S. and Chinese influence in Latin America may create a clash between elements of Trump’s expected agenda. While he has promised to “get tough” on China, that commitment could be weakened if he also pursues promises to crack down on immigration and impose heavy tariffs on goods imported to the U.S.—both of which are likely to endanger U.S. ties to Latin American countries. [In a social media post Monday, Trump said he would introduce a 25 per cent tariff on all goods from Canada and Mexico on his first day in office in January.]
Trump’s plans to scale back U.S. efforts on climate change also offer China an opportunity to step forward as a climate leader. Trump has said he will once again withdraw the U.S. from the Paris Agreement and will reverse Biden’s efforts to promote clean energy technologies. During this month’s COP29 summit, that prompted China to signal that it will take on more of a global leadership role on climate, especially in developing nations, NPR says.
China has also been a leader in developing renewable energy resources and addressing its own emissions, even as it continues to generate significant electricity from coal. While Trump’s policies are likely to delay or derail the U.S. presence in the clean energy industries, China’s decades-long investments are already paying off.
This competition, too, pivots to Latin America, home to vast reserves of lithium and other critical minerals needed for clean energy technologies. China has already cornered much of the world’s critical mineral supply chain, and its further influence over Latin American supplies will help cement its role as a top supplier to countries developing their own clean energy infrastructure.
“The coming U.S. retreat from leadership on global climate policy comes amid a dawning reality,” writes Politico. “For much of the world, China already calls the shots.”
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