In April, I told readers about the billions of dollars China was pumping into the New Silk Road, connecting Pakistan to China. But China isn’t stopping there. It seems the economic powerhouse has also set its sights on South America.
Chinese Premier Li Keqiang just completed an extensive nine-day tour of Brazil, Peru, Chile, and Colombia. These four countries account for 57% of China’s quickly increasing trade with South America.
In January, Li promised $250 billion in investment into South America over the next decade. As of the end of 2014, China had already invested nearly $100 billion into its favorite countries.
On his current tour, Li is lavishing billions more on a number of deals, most of which center around infrastructure, such as rail.
You see, China is unflinching in its quest for power and security. Meaning the Chinese want to ensure speedy delivery of the precious commodities produced in South America.
Cutting Through the Andes
One of the largest projects on Li’s agenda is a proposed 3,300-mile, cross-Andes railway, which will link Brazil’s Atlantic Coast with Peru’s Pacific Coast.
The idea behind this railway is to move commodities destined for China without having to go through the Panama Canal. China says the canal is controlled too much by the United States. And the country doesn’t like the potential for the United States to choke off commodity shipments to China.
Cost estimates for the rail link are from $5 billion to $10 billion just for the northern portion of the link through the Amazon. That route is comparatively short, but it’s sure to face huge environmental objections.
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