While China has won allies across Latin America over the past decade —and access to natural resources to boot—relations between Beijing and Havana remained piecemeal. What gives? Chinese Vice President Xi Jinping’s three-day visit to Cuba provides an opportunity to look at the odd tenor of Sino-Cuban relations. This post is based on an essay I wrote for World Politics Review.
Two changes have paved the way for more consistent ties. First, an ailing Fidel Castro relinquished power to his brother Raúl from 2006-2008. Raúl has shown himself to be more pragmatic than his older brother, and behind the scenes he is believed to be a student of China’s economic opening. Second, although Venezuela has become Cuba’s largest trading partner and economic lifeline over the past decade, the two countries’ barter relationship is increasingly precarious. Venezuelan President Hugo Chávez has used a series of schemes to spread Venezuela’s influence by delivering cut-rate oil to like-minded governments, especially Cuba. For years, Cuba re-exported much of the gas it received — roughly 100,000 barrels a day — for badly needed foreign exchange, but the island now faces an energy shortage from growing electricity demands. There are also rising complaints in Cuba about a shortage of doctors, as some 20,000 Cuban physicians are posted to Venezuela as part of an “oil for doctors” agreement.
With Venezuela’s ability to backstop Cuba’s economy increasingly in doubt due to the global economic downturn and the resulting dip in oil prices, China has become the lender of last resort of the debt-strapped island. Last year, China restructured an estimated $4 billion in Cuban debt and extended new credit to the government in Havana. These moves were interpreted as Beijing’s endorsement of Raúl’s economic reforms, which include expanding the private sector and cutting the government payroll.
Trade between Cuba and China has yet to regain its 2008 peak of $2.2 billion, but the need for Chinese manufactures on the island and the prospect of tapping Cuba’s offshore energy deposits should form the basis of future economic ties.
For decades, China and Cuba have been two countries separated by a common ideology. Xi’s visit suggests that China is ready to help the communist island revamp.
Photo from venceremos.cu
