Chinese Finance to Latin America and the Caribbean in 2017

The Inter-American Dialogue's Latin America and the World program and the Global Economic Governance Initiative (GEGI) at Boston University’s Global Development Policy Center estimate that China Development Bank and China Eximbank issued approximately $9 billion in loans to LAC governments and state-owned firms in 2017.

Information on the various loans issued to Latin American governments and state-owned firms from 2005 to the present is available in the newly-updated Dialogue-GEGI China-Latin America Finance Database and in our latest report on Chinese lending to the region, Down But Not Out: Chinese Development Finance in LAC, 2017.

Report findings include the following:

• The year 2017 was the lowest on record for Chinese state-to-state finance in Latin America since 2012, with only approximately $9 billion in loans from Chinese policy banks (China Development Bank and China Eximbank) to Latin American governments and state-owned enterprises.

• Even with the relative drop in activity in 2017, China’s record of lending in the region continues to surpass that of other banks. Including 2017 estimates, CDB and Eximbank have provided upwards of $150 billion in finance to LAC since 2005.

• As in previous years, Chinese policy bank loans in 2017 were directed toward a relatively small subset of countries. Brazil and Argentina accounted for 91 percent of total lending to the region, with 59 percent ($5.3 billion) issued to Brazil alone.

• Though a top recipient of CDB and Eximbank loans in the past, Venezuela received no finance from policy banks in 2017, after a loan of only $2.2 billion in 2016, aimed at improving the country’s oil production capacity.

• Chinese finance to the region in 2017 focused yet again on infrastructure development and, to a lesser extent, raw materials extraction. The largest Chinese loan in 2017—to Brazil for $5 billion—was given to Petrobras in exchange for oil shipments.

• As China's financial sector grows, a wider range of lenders is issuing finance in LAC. In addition to policy bank lending, China's commercial banks are increasingly active in Latin America and other regions, often in cooperation with other international banks. At least one of China's three regional funds also delivered new projects last year.

REPORT: Down But Not Out: Chinese Development Finance in LAC, 2017

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