The Council on Foreign Relations has released a report examining China's use of trade ties in Latin America, particularly with Chile, to circumvent U.S. tariffs, challenge U.S. strategic interests, and create competition in the seafood industry.
According to the Council on Foreign Relations, China has become South America's largest trading partner and the second largest for Latin America overall, with trade reaching a record $518 billion in 2024. China's imports from the region largely consist of raw materials—such as soybeans, copper, and petroleum—while it exports higher-value manufactured goods. This trade pattern has significantly deepened China's economic integration with countries like Chile, which alone sent nearly $38 billion in exports to China in 2023, accounting for 38 percent of its total exports.
The Financial Times reports that Chinese manufacturers are relocating operations such as assembly and packaging to countries like Chile and Mexico to sidestep rising U.S. tariffs. This strategy allows Chinese-made products to enter U.S. markets under the guise of Latin American origin, reducing China's exposure to direct tariffs. Latin America thus serves as a vital intermediary in China's tariff-dodging scheme.
Reuters notes that U.S. security officials have expressed concern about China's expanding investments in ports, logistics, telecoms, and credit lines across Latin America posing a strategic threat by eroding U.S. influence in the Western Hemisphere. The presence of Chinese entities around strategic infrastructure like the Panama Canal has been flagged as "very concerning" and a national security issue. This trend is seen as part of China's broader geopolitical push aimed at diminishing U.S. leverage.
A 2025 report by the U.S. International Trade Commission highlights that U.S. fishermen, seafood processors, and port industries are disadvantaged by low-cost Chinese-backed Chilean seafood exports, which frequently benefit from lower environmental and labor compliance costs.
The Council on Foreign Relations is a nonpartisan, independent think tank and national membership organization founded in 1921. Its mission is to inform U.S. engagement with the world through policy-relevant analysis, expert convenings, and public education.