October 27, 2020

Guyana Is Proof of the Pitfalls of Chinese Aid and Investment in the Caribbean

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l_guyana_11092016_1By Jared Ward From World Politics Review

The small developing nations dotting the Caribbean have recently become sites for massive amounts of foreign aid from China. Large Chinese-built infrastructure projects and millions in investments have taken their place next to sun-splashed tourists, sprawling resorts and bustling cruise ports.

Earlier this year, thousands of Chinese workers flocked to Jamaica to complete a $730 million mega-highway that cuts through the heart of the island, shaving hours off typical tourist commutes. In Barbados, Chinese officials have pledged tens of millions of dollars to restore gymnasiums, renovate historic sites, and dock a goodwill hospital ship in the capital, Bridgetown, to provide free medical care to Barbadians. In perhaps the greatest example of China’s growing presence in the Caribbean, a Chinese firm has broken ground on a mixed-use facility comprising 450 apartments and 326 hotel rooms on St. Maarten dubbed the “Pearl of China.” The beachfront property aims to become a hub for Chinese business in the region and bring Chinese businessmen and money in droves to the island.

The promise of Chinese aid and investment to the Caribbean is consistent with a pattern elsewhere in the developing world. touts its own track record as a once-developing country with a no-strings-attached approach to development assistance, highlighted by interest-free loans and what it promotes as Chinese intentions to help, not exploit, local communities. Closer relations with China and access to its aid are a potential boon for Caribbean nations seeking to break free from failed models of development. But on the ground, the situation is much more complicated. Nowhere is this clearer than in China’s oldest partner in and around the Caribbean, Guyana, where projects that brought promises of modernization are often more gilded than gold.

China’s relationship with Guyana is historically unique to its Caribbean policies. A small member of the , or CARICOM, Guyana is a gateway between the resource-rich nations of Brazil and Venezuela and the U.S. market. It was the first English-speaking nation in the region to recognize China diplomatically in 1972, against the grain of Cold War convention that made ties with the Sino-Soviet bloc a poison fruit. That made Guyana a laboratory of sorts for Beijing and the site of its first foreign aid project in the Western Hemisphere.

Chinese technicians worked hard alongside Guyanese laborers to erect a brick factory that would utilize the nation’s rich clay reserves to meet then-Prime Minister Forbes Burnham’s goal of universal housing by 1976. The promises of 10-million bricks a year fell short, and the factory was abandoned by the early 1990s. Overgrown, the building returned to the wild, foreboding the contradictions between Chinese promises of modernization and realities in Guyana.

Nevertheless, China has continued to draw on the deep roots of its relationship with Guyana to show its long-term commitment to mutually beneficial relations in the Caribbean. lacks the vast mineral reserves of China’s other partners in the developing world, especially in Africa, the South American country gives Chinese companies access to a total of 270 million consumers in South America and the Caribbean and over $130 billion dollars in market access.

Guyana also reflects Beijing’s mix of diplomacy in the region. In addition to offering Guyana millions in free medical aid, China is also working to expand the nation’s internet and telephone access and has proposed a superhighway that would cut through dense rainforest to link Guyana and Brazil. But Beijing has also hit some roadblocks, such as the recent forced closure of a prominent Chinese logging company, Baishanlin.

In Guyana, Chinese projects that brought promises of modernization are often more gilded than gold.

When Baishanlin arrived in Guyana over a decade ago, its promises followed a familiar pattern set by other Chinese state-owned companies. It would be given access to millions of acres of vast timber reserves in exchange for hiring local workers and leaving behind a tangible example of Sino-Guyanese friendship: a wood-processing plant that would develop Guyana’s timber industry. But grievances against the company have mounted over the years and came to a head in September, leading the Guyana Forest Commission to seize company assets and equipment to recoup losses that Baishanlin took in tax and export exemptions. What’s more, the company has been accused of flouting local labor laws, failing to pay Guyanese employees adequately, and never delivering the wood-processing facility.

The failures of Baishanlin echo common critiques of China’s foreign policy in the developing world. Proposed projects are funneled to Chinese companies often under a secretive bidding process; those companies then import Chinese contract workers as their primary labor force. In Guyana, business owners and workers have voiced wariness that Chinese state-owned enterprises are pushing out local business with little benefit for common workers. There’s also concern that China leverages its size to gain unfettered access to natural resources, which risks the exploitation of Guyana’s vast virgin rainforests. While the export of goods to the Chinese market and an attraction of Chinese tourists remain a carrot for Guyanese policymakers, there’s little evidence of a transformative economic impact so far.

Baishanlin is a sign of the problems China has encountered in and around the Caribbean, but it also shows how Sino-Guyanese ties are a microcosm of bigger global developments. Beijing’s willingness to be so visible in the Southern Hemisphere, which has long been under the umbrella of Washington, points to rising tensions in its relations with the United States.

Last year, President Barack Obama warned Caribbean leaders to be wary of the possibility that China would bully its way into their affairs, much like it was doing toward small nations like Vietnam vying for territorial rights and resources in the . Beijing has responded in kind. In June, the state-run news agency Xinhua, a mouthpiece of the Chinese Communist Party, implored American policymakers in an editorial to stop treating the South China Sea like the Caribbean. It compared Washington’s “making waves” in the South China Sea to a pattern of behavior and bullying in its own backyard to block countries’ independent development for its own political reasons.

In the coming years, Beijing’s push into the Caribbean will likely reverberate in both Asia and the Americas. China has touted itself as different—a global power, but one with an intimate understanding of the difficulties of national development in what it sees as a historically unjust global economy. China’s ability to project its own success and its alternative pathway to development will continue to be tested against the traditional Western-backed institutions like the International Monetary Fund and the World Bank. The difficulties of China’s development aid to Guyana, and the verdicts yet to be rendered in places like St. Maarten, will become part of a broader conversation about hegemony and regional power politics, as countries as far afield as Cuba and the Philippines find themselves at a crossroads of redefining their own longstanding partnerships.

Jared Ward is an associate lecturer and doctoral candidate in East Asian history at the University of Akron. His research and dissertation focuses on China’s relations with Caribbean nations during the Cold War.

IMAGE: The central bank in Georgetown, Guyana, Aug. 29, 2016 (AP photo by Bert Wilkinson).

For more on this story go to: http://www.worldpoliticsreview.com/articles/20410/guyana-is-proof-of-the-pitfalls-of-chinese-aid-and-investment-in-the-caribbean

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