China’s Plan to Bypass the Panama Canal
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One thing I'm curious about is the China of today is very different from the China 10 years ago. So as China was expanding all of its Belt and Road investments in Latin America, it seemed like the money was almost infinite. Now the Chinese economy is definitely retracting. It's having a lot of problems. How has that affected their reach into Latin America? I think they're becoming more selective and more strategic.

in what they do, which institutions they engage with, and which institutions do they put aside at this moment. So one big project, of course, is the Peruvian Chiang Kai Port. And that port basically allows China to ship back to China whatever natural resource they collect around South America.

And despite them kind of retreating, as you say, in terms of investment, they're still putting a lot of effort in having this port built because this port will give them a strategic advantage. And also it will allow them to kind of bypass the use of the Panama Canal for some of the produce that they want to get back to China because there is another project that is being built right now that will connect Brazil

and actually Chile, but then you have the Carretera Interamericana, which is the transoceanic road, right? Which will connect Brazil, Paraguay, Chile, and then Peru through secondary roads.

So it goes through the Andes Mountains? Yeah, it goes through Paraguay, through the Andes Mountains, and then down through the desert. And it's a huge investment, and it goes around places which are largely inhabited. But the thing is, it will allow any truck to go from Brazil to the other side of the

to the other ocean directly, sort of to bypass the huge traffic that is going on in Panama, which is not only a concern in terms of climate change because they have a water scarcity right now, but also the huge queue that is formed on each side, right? To just cross one boat.

And also right now, because of the Trump administration, China's control over the Panama Canal has sort of been wrestled away. All the Hutchinson ports have sold to U.S. companies. So that seems like a trade route China no longer can control. If they could control something like this...

Yeah, of course, because it's just sending trucks. You don't need, if you want to invest money, just invest in enlarging the road or, you know, covering the holes on the ground. It's not much of an effort. And although China is not directly involved in that road, well, they will get sort of a benefit from it. And also,

This Chiang Kai-Po will also be able to export any minerals they gather from what is called the lithium triangle, right? So anything they get from Bolivia, Argentina, and Chile from the north, you can ship it away from Peru. So that is a huge project that they are building right now. A second effort that it seems that they're taking some interest in

is the Antarctica, since in a few years the agreement will have to be reviewed. So there will be some discussions over sovereignty in Antarctica. Another issue that they're looking at, of course, is the Taiwan problem, what they call it the Taiwan problem, which is just getting Paraguay to stop recognizing Taiwan.

Are there any developments in that field? I'm sure China is really wooing them. I mean, there is a lot of presence of Chinese actors in Paraguay trying to kind of build ties with politicians and businessmen, etc. But at the same time, they kind of don't have the direct incentive right now because what the Paraguayan government did is that they just ship everything to Brazil and

And they use the Brazilian market to export stuff to China. So actually, a lot of Paraguayan beef, for example, goes to China. But on paper, it says this is Brazilian Angus beef, for example. So it's like a step removed. Yes. So...

They don't have the direct incentive. They do lobby a lot. But of course, Taiwan also is increasing their efforts to not lose Paraguay as a partner. I'm curious. I'd like to know more about that road. Do you know what state of development it's in? Because historically, a lot of Belt and Road infrastructure projects just don't materialize. But that is the thing. This is not a Belt and Road project.

project. This is a project that is built between all these countries because all these countries have interests in being connected and also Paraguay has a lot of interest in having a road going through a place in Paraguay that has literally no one living there. No connectivity at all, but that could be easily

be used by any truck that goes from one side to the other. And that includes Chinese trucks as well. So that is interesting because of course, Brazil is part of BRICS and has a lot of interests in engaging to an extent with China, but they also want to be a regional leader. So they do want to take some

some leadership position in this road. And regarding the state of construction, I am not 100% sure. I will have to check. But the project is written. I mean, I know that the road has been mapped out, surveyed, and it just needs to be built right now.

Interesting. So that could be a pretty big game changer. Though I could also see that's something the United States could get involved with in some way. Yeah, I mean, for the United States, especially for their maritime interests, decompressing the Panama Canal is a huge incentive because it takes weeks to pass any ship from one side or the other.

So it would also be in the U.S. interest if there was some alternative, as long as it's not Chinese controlled, alternative to the Panama Canal. Yes. Well, a few years before they were talking about building a Nicaraguan canal. Yeah. But this is basically an alternative that doesn't include the ships. And that's also, it has problems because all ships will have to have a counterpart on the other side, right? Yeah.

So you need two ships basically to make this work. Two big ports. And two big ports. Which could have potential military applications as well. Of course. I'm sure any port that big. Yes.

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