There’s a “Red Storm Rising” just miles from America’s shores. “In point of fact, the entire hemisphere is on fire,” said Lou Dobbs on his widely watched Fox Business Network show on April 4. “China and Russia are engaging us in almost every quarter in this hemisphere. Russia and China in Venezuela, but China throughout the hemisphere and throughout the Caribbean.”
Throughout the Caribbean, China’s influence is growing fast. Trade and investment have made Beijing a power. Chinese motives are not solely commercial, however, and do not appear benign.
We begin on the island of New Providence, in the Bahamas. The Export-Import Bank of China in 2011 extended a $2.45 billion construction loan for the Baha Mar resort, near the capital of Nassau. The project, troubled from the start, is the largest and most expensive in the Caribbean.
The project’s size is a curiosity, and China’s large commitment to the Caribbean is, from an economic viewpoint, intriguing. As Evan Ellis of the U.S. Army War College points out, China, on a per capita basis, has more equity invested in the Caribbean than in the rest of Latin America. This is noteworthy in that the Caribbean has, in comparison to the rest of that region, far fewer natural resources and only a tiny market for Chinese goods. As Ellis told Roll Call, “It really isn’t about the market or the materials if you look at the amount that they are investing.”
So, what is China’s motivation? Another large Bahamian investment provides a clue.
About 55 miles east of Palm Beach, on Grand Bahama Island, a Hong Kong-based business is spending about $3 billion on a deep-water container facility, the Freeport Container Port.
The commercial rationale is that Freeport will be able to take advantage of traffic from the recently expanded Panama Canal, but the concern is that the port will become another debt-trap, like Hambantota in Sri Lanka.