Latin America Could Turn to Russia, China in Wake of Trade Split With US

The governments of some Latin American countries have signaled that they are ready to “break their dependence” on the United States; Russia and China could play a key role in the region, Venezuelan political analyst Ernesto Wong told Sputnik Mundo.

Chinese President Xi Jinping
In an interview with Sputnik Mundo, Venezuelan political analyst Ernesto Wong said that in Latin America, there are several factors which have given rise to the hope that this year will see a number of key political changes in the region.

One of these factors is the willingness of some regional governments to “break their dependence” on the United States and allow Russia and China to play a key role in the region, according to Wong.

“Latin America is at odds with Washington but it is developing friendly ties with China and Russia, which is why in 2017 the region is expected to overcome the imperialist dependence on the US and to establish more favorable conditions for exchange… trade and investment with Russia and China,” Wong said.

As for China, Wong referred to the January 20 meeting between Beijing and the Community of Latin American and Caribbean States (CELAC), which he said opened up new prospects for the exchange of public and private capital.

“It’s important that none of the countries of the Pacific Alliance decided to break off relations with China, which means that they are  interested in continuing trade ties with Beijing,” he said. The Pacific Alliance is a Latin American trade bloc which currently includes Chile, Colombia, Mexico and Peru.

According to Wong, the most important affecting the Pacific Alliance is the existence of Trump’s so-called model of “neo-isolation.” The alliance had been seen as a close partner of the United States and Canada; its members (less Colombia) were among the countries set to co-establish the Trans-Pacific Partnership (TPP) this month.

This initiative was nullified when Trump abandoned TPP on January 23. Trump also raised the question of revising the terms of the North American Free Trade Agreement (NAFTA).

“As a consumer, the US is in a critical situation after it greatly reduced its imports, which were supported by the free trade agreement. Trump wants to get out of it because he intends to develop national industry,” Wong said, adding that this process will also be affected by the critical situation in Western Europe.

Aside from to China and Russia, Latin American countries may also invest in Africa, according to Wong.

“This is potentially a good opportunity because openness toward Africa would help promote Latin American products there and the African continent would benefit from receiving equal conditions for exchange,” he said.

He added that such transparency would also be attractive for those countries in the region which are not progressive because they seek to improve relations with other regions, which could give them the opportunity to obtain a larger income.Wong emphasized that it is Latin America distancing itself from the United States and rapprochement between Eurasia and Latin America that will pave the way for regional countries becoming more independent and sovereign.

Article originally published here

India and China, Full Speed Ahead in Climate Change Mitigation

chinese-and-indian-leaders-meetingWhile the United States is wondering what will happen next on climate change mitigation in their country, both India and China have recently unveiled very ambitious plans to fight local air pollution and global climate change.

According to an article from the Guardian, India plans nearly 60% of electricity capacity from non-fossil fuels by 2027. This makes the Indian government believe that it will exceed its Paris Agreements targets by far, with :

” A draft 10-year energy blueprint published this week predicts that 57% of India’s total electricity capacity will come from non-fossil fuel sources by 2027. The Paris climate accord target was 40% by 2030.”

The Guardian goes on to list how India could become a renewable energy super power in the next decade or so, as investments in the area are booming. From bringing electricity to 400 million people with solar energy to going LED or investing massively in renewables, India has been showing strong leadership in this most important issue for a few years now. To the point that, according to newspapers, renewable energy investments in India to reach $250 billion over next five years, and over a trillion by 2030.

In neighbouring China, the government has announced a plan that it will spend $360 billion on clean energy sources by 2020. This will result in the creation of 13 million jobs and cut significantly the amount of air pollution in Beijing and other Chinese cities.

Meanwhile, Beijing has announced that it will be closing  and/or not building another 104 coal-fired plants that were either due to be constructed soon or were being constructed. This move is significant – 120 Gigawatts of capacity – as it is equal to a third of the amounts of coal-fired plants in the United States.

China installed over 34 Gigawatts of solar PV capacity in 2016 alone as Cleantechnica reported, with over 11 GW in one month alone. This is absolutely staggering as it brings the total solar PV capacity of the country to 77 GW. Yes, capacity almost doubled in one year.

All this can be explained by the fact that renewables are getting more and more competitive every day and that smart countries invest in cost effective and low carbon solutions. In early 1996, the global solar PV capacity was of 200 MW, now the world installs that capacity every single day… Let that sink in. And it probably will not stop anytime soon as to Bloomberg New Energy Finance, solar is now becoming even cheaper than wind.

Edited, original article written by Edouard Stenger

Renewable Energy, a Rising Tide

Leading the surge is China, which already has a huge advantage in its current position at the front of the pack.china-investments

China has not only vastly expanded its domestic investment in renewable energy, it is plowing record sums into renewables markets overseas. As our report noted, China put $32 billion into foreign renewables projects in 2016 alone, and last week it said it would increase its bets on renewables by tenfold around the world before the end of 2020. That increased bet is likely to expand China’s renewable-energy employment base beyond its current 3.5 million level. Of note on this point: employment growth in renewables is in sharp contrast to massive worldwide layoffs in the oil, gas and coal industries.

Its domestic renewables push has given China priceless experience ahead of other nations, allowed it to develop leading-edge technology, educated a large, supporting labor force and created financial mechanisms to pay for the expansion. Now China is exporting its renewables juggernaut, taking stakes in projects of note elsewhere in Asia and in Africa, Europe, India, North America and South America.

We think the global boom in renewables will last for decades, driven not just by Chinese investment but by other emerging economies—and by industrialized ones as well. Growth in solar, wind and energy-efficiency initiatives are steadily reducing the costs of production and making renewable energy cheaper than traditional sources. Public pressure to combat pollution and build collective action on global climate change is growing. These are huge combined market forces that as we speak are shaping how electricity production, especially, is being reimagined.

In the fast-moving renewables revolution, economies as diverse as those of Bangladesh, Brazil, Chile, Indonesia, Kosovo, Mexico, the Philippines, Puerto Rico, and South Africa now have the means to foster prosperity without imposing harsh consequences on public health and the environment.

Meantime in the U.S., national energy-policy discussions are drifting the other way as an evidently over-the-hill gang takes power in Washington with hopes of going back in time to when companies like Exxon mattered more than they do now and when economic growth was driven by fossil-fuel consumption.

Those days are done, though, and so are the days when solar- and wind-powered energy were dismissed by skeptics as sci-fi experiments or “alternative” sources to traditional fossil-fuel generation.

There’s no turning the clock back. Clean energy has gone mainstream.

Abridged, article originally published here

China Seizes Opportunities in Latin America

chinese-dragonChina has big plans for Latin America—plans that seem to reflect China itself: massive and ambitious.

There are plans for a $10 billion, 3,300-mile-long transcontinental railroad snaking through the jungles of the Amazon river basin and over the highest mountain range in Latin America, linking the Atlantic shore to the Pacific. There’s talk of a $50 billion supersized canal carving a 161-mile-long swath across Nicaragua, offering passage to the megatankers of tomorrow and overwhelming even the newly expanded Panama Canal to its south.

There are more. Many more. These gargantuan projects are aimed at fueling China’s needs for resources and feeding South America’s need for energy and infrastructure. But geopolitics also play a role as China strives to make Latin America an economic partner, if not a counterpoint to the United States.

In fact, China’s investments in Latin America, from mining to massive hydroelectric dams, nuclear reactors and railroads, grew by 500 percent between 2000 and 2010, totaling nearly $100 billion, with another $250 billion in spending promised over the next decade. And while the U.S. still accounts for more than three times as much in trade and investment in the region, some analysts see disturbing signs in the steadily shifting balance.

In 2000, the Chinese portion of Latin American trade was about 2 percent. The U.S. share was 53 percent. Ten years later, the Chinese share was up to 11 percent and the U.S. portion was down to 39 percent.

“Clearly we are still the dominant player vis-à-vis them,” says Francisco Cerezo, the U.S. head of DLA Piper’s Latin America corporate group. “But it does speak to the trend. And I would be more concerned about the trend and making sure you right the ship and you focus on it properly.”

The past two decades of forays into Latin America come as part of China’s “go global” plan. Its first priority: raw resources to fuel its economic growth. China is heavily, and increasingly, dependent on imported oil. Its energy needs led it to offer some $65 billion in loans to Venezuela’s government in the last decade, according to the Washington nonprofit Inter-American Dialogue, along with direct investments in oil production and infrastructure there.

China also single-handedly accounts for nearly a fourth of the world’s copper demand, along with significant demand for tin and iron ore. “That’s why you see them coming into Latin America’s mining sector, which is huge,” says Jerry Brodsky, a partner and director of the Latin American practice group at Peckar & Abramson. “It’s perhaps the largest economic driver in Latin America’s mining.”

China gets much of its copper from Chile, while the China-based Chinalco Mining Corp. International put $3.5 billion into the Toromocho mine in Central Peru, giving it control of “the world’s second largest preproduction copper project, as measured by proved and probable copper ore reserves,” according to the company’s website.

Now China is reaching beyond resources. Its latest wave of investments involves massive infrastructure and energy projects.

The China Three Gorges Corp. has been rapidly acquiring hydroelectric dams in Brazil since 2013, paying nearly $4 billion in June to take over operation of two of the country’s largest dams, with a combined capacity to produce 5 gigawatts of electricity. That came just three months after China Three Gorges announced a proposal to build a new 8-gigawatt dam on the Tapajos River.

China’s State Grid Corp. is developing two transmission lines to deliver power from the Belo Monte dam in the Amazon basin. Last year, state-owned China National Nuclear Corp. signed a $15 billion deal to build Argentina’s fourth and fifth nuclear power plants, roughly doubling the amount of electricity generated by the country’s nuclear plants. Construction of the first of the new reactors, in cooperation with Argentina’s state-owned Nucleoeléctrica, is due to begin early next year.

These projects come on top of the nearly $42 billion that China invested in infrastructure in Latin America in just 2013 through 2015 alone. China is finishing construction of a space tracking, telemetry and command facility in Patagonia, Argentina, complete with a pair of maneuverable parabolic antennas, engineering facilities, and a $10 million electric power plant.

China Harbour Engineering teamed up with local partners to win the contract for Autopista Mar 2, a 152-mile motorway connecting four towns north of Medellin, Colombia. And, in May, it landed a $465 million road contract in Costa Rica.

“They’re providing what the specific markets need,” says Brodsky. “They follow the path of least resistance. Latin American needs infrastructure. Brazil has an insufficient production of local energy. So does Argentina. The road projects in Colombia are booming right now because for 30 or 40 years they spent all their money fighting the guerrillas, and they didn’t pay attention to their road infrastructure. So now there is an accelerated program in Colombia for road building.”

The nature of the projects also plays to China’s strengths. Despite its recent economic slowdown, China remains flush with money from its boom years. Combined with the technical expertise that it has built with domestic projects and industries, those deep pockets allow China’s state-owned companies to compete at a scale that few challengers can match.

“When you get to that level of megaprojects, there are not that many qualified bidders out there­—people that have not only the technical capacity but the financial capacity,” Brodsky says, adding that Chinese companies “have the money to self-fund a lot of their projects, and that makes them very competitive when it comes to bidding for big, large projects in Latin America.”

Abridged, original article published here

Emerging Nations Have Taken the Lead on Renewable Energy

Historically speaking, wealthier, developed nations, particularly the US and Europe, have led the world on renewable energy, investing the most capital and building the most capacity. Last year, that changed.

In 2015, for the first time, countries outside the Organization for Economic Cooperation and Development (OECD) invested more in renewable energy and added more renewable capacity than the 15 OECD countries combined.

This is only a bit of symbolism — the lines have been converging for a while — but it is important symbolism.

Led by China, emerging nations have emerged

The finding comes from the 2016 Climatescope report from Bloomberg New Energy Finance (BNEF). It’s an annual snapshot of the state of clean energy in non-OECD countries. It goes deep, ranking countries on policies, finance, value chains, and various other metrics.

They’ve got an excellent data visualization to walk you through the results, if you’re interested, and a cool widget that allows you to compare any two countries on any set of metrics.

To me, the headline news is illustrated by two charts. This shows renewable-energy capacity additions from 2011 to 2015:

climatesope capacity additions(BNEF)

As you can see, after some fluctuations, non-OECD countries nosed ahead last year. It might bump around another year or two, but the longer term trend is clear: The center of clean-energy gravity is moving south.

And it’s almost entirely due to China. The country installed 142 gigawatts (!) of new power generation capacity in 2015, of which 33 GW was wind and 18 GW was solar PV. (Compare to India, which installed 27.8 GW of new capacity — 2.6 GW of wind and 1.7 GW of solar PV.)

This shows renewable-energy investment from 2011 to 2015:

climatescope investment(BNEF)

Again, these numbers might bump around for a few years, but renewable-energy investment in non-OECD countries is headed up, whereas investment in developed nations seems to have plateaued.

The surge in non-OECD investment is led by solar:

Investment in utility-scale solar in Climatescope nations spiked 43% from 2014 to $71.8bn in 2015. Total clean energy investment in Climatescope countries rose $24.8bn with solar accounting for nearly all of that. Photovoltaic (PV) costs are essentially on par with wind and, as recent tenders for power contracts have demonstrated, PV can now out-compete fossil-fuelled projects on price.

Solar and wind now dominate renewable-energy investment. “Together, [wind and solar] accounted for 65% of new clean energy investment in 2011,” BNEF writes. “By 2015, that had risen to 94%.”

And investment is spreading beyond China as well (this is from a different BNEF report):

An expanded list of emerging countries committed billions to clean energy last year with record increases, including Mexico ($4.2bn, up 114%), Chile ($3.5bn, up 157%), South Africa ($4.5bn, up 329%) and Morocco ($2bn, up from almost zero in 2014).

The world’s fate will now be decided by the race between coal and renewable energy in the Southern Hemisphere. Coal growth is slowing, but we are still headed for catastrophe.

This (okay, fine, three charts) is from the US EIA’s International Energy Outlook 2016:

EIA: energy sources through 2040(EIA)

If this unfolds, global average temperatures will exceed 2 degrees — possibly even 3 or 4. To stop short of 2 degrees, global coal use will need to be close to zero by 2040, with oil not far behind.

Emerging nations, like their OECD counterparts, are moving in the right direction, but too slowly.

Article originally published here

Why China is Cosying up to Latin America

china-lac-373x300Just days after Donald Trump’s victory in the US election, President Xi Jinping (習近平) set off for Latin America – his third trip to the region since taking office in early 2013. Beijing has laid out a new road…

BY CARY HUANG

Beijing has laid out a new road map for its relations with Latin American and Caribbean countries in a strategic push to expand its clout on the continent.

China’s growing interest in Latin America is raising many questions in the West, especially in the United States, which has considered the region its backyard since it adopted the Monroe Doctrine in the 1820s. That doctrine states US opposition to any outside intervention in North or South American affairs – and says any such action will be viewed as “the manifestation of an unfriendly disposition towards the United States”.

This closer engagement with Latin American countries coincides with a US president-elect who has vowed to scrap regional trade deals, build a wall on the Mexico border and deport undocumented immigrants.

But it’s an engagement that has caused business to boom. Trade between China and Latin America and the Caribbean multiplied by 22 times between 2000 and 2013, reaching US$236.5 billion in 2015. In 2014, China overtook the European Union to become the region’s second largest trading partner after the US.

The following year, Beijing signed a slew of agreements with Latin American countries promising to double bilateral trade to US$500 billion and increase the total stock of investment between them from less than US$100 billion to US$250 billion within ten years.

China sees its relationship with these countries as primarily economic rather than political or ideological.

Economically, China aims to diversify the sources of energy and materials for its manufacturing-centred economy. It also aims to find new markets for the country’s industrial overcapacity.

But its rising economic influence will inevitably come at Washington’s expense. In 2000, China’s share of Latin American trade was 2 per cent, compared to the US’ share of 53 per cent. By 2010, China’s share had grown to 11 per cent, while the US’ had dropped to 39 per cent.

China is also using its economic clout to win diplomatic allies and challenge US supremacy and its dominance in the region. Beijing is intent on making friends in the US’ historical sphere of influence to match America’s allies in East and Southeast Asia. The diplomatic offensive is part of a larger plan to make China a world-class power under Xi’s “Chinese dream” of national rejuvenation. Xi also wants to turn China into a maritime force, capable of projecting power, both soft and military.

Beijing might also be trying to target Taiwan. Of the self-ruled island’s 22 allies, 12 are in South America, and cross-strait relations have become decidedly chilled since Tsai Ing-wen of the independence-leaning Democratic Progressive Party took office in May.

Nevertheless, the debate in Washington will focus on whether China’s growing clout will undermine American diplomacy in the region, as it runs counter to the Monroe Doctrine. Anyone suspicious of China’s ambitions might point to America’s own history. A little more than a century ago, the US’ construction of the Panama Canal heralded the advent of a new era of American dominance. Now China looks to be doing the same with its work on a 270km Nicaraguan canal that will one day rival the Panama route.

Historically (post-Mao) China’s leadership has eschewed interventionist diplomacy. But the leadership is shifting that policy and it is possible Latin America will become the stage for a showdown between the world’s greatest superpower and a fast-rising one. ■

Article originally published here