Inspired by the ancient Silk Road trade routes, China launched the Belt and Road Initiative (BRI) in 2013, initially aiming to connect the physical infrastructure of Eurasia. Today, 22 countries in Latin America and the Caribbean (LAC) have joined the Initiative, leading to increased bilateral trade with China, Chinese direct investment flows, and the development of infrastructure and energy projects.
Cooperation between China and LAC
During the 2015 China-CELAC Forum in Beijing, President Xi Jinping proposed an initiative to establish a new framework for cooperation between China and the countries of Latin America and the Caribbean called “1+3+6.” The 1 refers to the China-LAC Cooperation Plan, the 3 represents the three engines: trade, investment, and financial cooperation, and the 6 represents the six areas: energy resources, infrastructure, agriculture, manufacturing, technological innovation, and information technology.
In 2017, Beijing referred to Latin America and the Caribbean as a “natural extension of the Route” MarThe Silk Victim of the Century XXIIn November of that same year, Panama became the first Latin American country to officially participate in the Initiative. In the following two years, eighteen of the twenty-three states in the region followed suit.
Since then, more than 200 projects have been approved in Latin American countries, predominantly focused on improving connectivity. This includes investments in public transportation systems, roads, ports, highways, and electricity transmission networks. Beyond physical infrastructure, the Initiative has also fostered partnerships in science and technology.
It is important to note that the agreements signed under the Initiative are non-binding and therefore do not create legal obligations for either party. Instead, they serve to define cooperation mechanisms and facilitate project implementation.
Stores
According to Argentina's National Scientific and Technical Research Council (CONICET), China's growing influence in the region and the participation of numerous Latin American countries in the Initiative have allowed them to significantly increase their exports. Bilateral trade between China and Latin America and the Caribbean (LAC) reached a record US$565.000 billion in 2025, a year-on-year increase of 6,5%, consolidating China as the region's second most important trading partner and the main trading partner of countries like Chile, Brazil, and Peru.
However, this trade is highly concentrated, both geographically and in terms of the types of goods. Between 2015 and 2019, almost 70% of Latin American exports to China consisted of soybeans, crude oil, copper, and iron ore. Ninety percent of these exports came from just four countries: Brazil, Chile, Peru, and Venezuela. China's exports, on the other hand, were primarily consumer goods, with a particular emphasis on technology products. This was partly due to the growing presence of Chinese companies in the information and communication technology sector and the influence of the Digital Belt and Road Initiative.
Investment and financing
According to UNCAD data, Chinese foreign direct investment in Latin America and the Caribbean reached $55.624 billion between 2020 and 2024. Despite being a lower figure than in the 2015-2019 period, the region remains the second largest destination for Chinese direct investment abroad, and China is the third largest source of investment in Latin America.
By April 2025, the China Development Bank had provided financial support to more than 260 projects in Latin America. Chile also became the first yuan clearing center in South America and the first country in the region to participate in the Qualified Foreign Institutional Investors in Yuan pilot program—a group of foreign financial institutions authorized by China to invest their yuan funds directly in the country's onshore capital market.
Unlike official development assistance (ODA) provided by traditional institutions—such as the World Bank or the International Monetary Fund—financing under the Initiative is characterized by a lack of conditionality and respect for the sovereignty of developing countries. This enables these countries to design their own national strategies without external interference, allowing them to address their needs and fostering sustainable development.
The importance of raw materials
Between 2000 and 2018, China invested over $73.000 billion in Latin America's raw materials sector, including the construction of refineries and processing plants in countries rich in coal, copper, natural gas, oil, and uranium. More recently, China has focused its investments on lithium production in the so-called Lithium Triangle, which includes Argentina, Bolivia, and Chile, and which together contain approximately half of the world's deposits of this mineral, crucial for the manufacture of electric vehicles and batteries.
The economic relationship between China and Latin America and the Caribbean (LAC) is increasingly focused on raw materials related to the energy transition. According to the China-Latin America and the Caribbean Economic Bulletin, Chinese investment in transition minerals—the minerals most needed to support the energy transition, such as aluminum, copper, and iron—has doubled in the last five years. Conversely, Chinese investment in fossil fuels in LAC peaked in the early 2010s and has since become secondary.
Infrastructure
The integration of Latin America and the Caribbean into the IFR has brought about a major shift in the region's connectivity and has helped overcome its historical deficit in physical infrastructure. Currently, Latin America is the third largest market in the world for Chinese infrastructure companies.
One example is the Chancay port project in Peru, considered the largest smart and eco-friendly port in South America. It establishes a logistics corridor between Latin America and Asia with a capacity for 18.000 containers and is capable of reducing shipping times from 45 to 23 days. Another flagship project is the modernization of the Belgrano Cargas Railway in Argentina, which has increased annual cargo volume from 760.000 to 8,4 million tons since its launch in 2019, reducing logistics costs by 30% and revitalizing grain exports from producing regions.
The chart shows all infrastructure projects, both completed, under construction, or in the planning phase, in which China is involved.
FuenteRegional Repository on Chinese Investment in Latin America
Sustainability
The Belt and Road Initiative has also faced criticism regarding environmental and sustainability issues. However, in recent years, several initiatives and efforts have been launched to create a greener Belt and Road. In 2018, for example, the Green Finance Committee of the China Society of Finance and Banking and the City of London Green Finance Initiative published the Green Investment Principles for the Belt and Road Initiative.
The principles urged lenders, investors, and planners to ensure that projects under the Initiative met sustainability requirements. They also called for the assessment and disclosure of climate risk mitigation strategies, the creation of green investment targets, and commitments to phase out carbon-intensive investments.
Furthermore, the implementation of an initiative called the “Green Silk Road” has been promoted. In 2024, 52,73% of Chinese energy infrastructure projects in Latin America and the Caribbean were related to renewable energy, primarily solar and wind power.
Among the most important projects of the Green Silk Road is the Belo Monte Hydroelectric Plant in Brazil, which, with a capacity of 11.233 MW, currently supplies 60 million homes annually and covers 10% of the country's electricity needs. Another example is the Punta Wind Farm Sierra In Chile, financed by Chinese energy companies, a project provides clean electricity to 130.000 homes and has reduced carbon emissions by 157.000 tons per year. Finally, it is worth highlighting the Park SolCaucharí in Argentina, the largest solar park in Latin America, which has 1,2 million solar panels and a power of 315 MW.
Conclusion
More than a decade after its implementation, the Belt and Road Initiative has demonstrated great potential to redefine the development model in Latin America and the Caribbean. Besides significantly increasing bilateral trade with China, the region has attracted investments that prioritize the transition to clean energy and the industrialization of critical minerals.
Unlike conventional ODA models, the Initiative has allowed these countries to modernize their infrastructure—from smart ports to electricity grids—without political constraints. This flexibility has been key for local governments to design projects that truly address their logistical and energy needs.
