China is expanding its influence in El Salvador, with projects raising concern about their political, economic, and security implications for the region. Among those is the new National Stadium in Santa Tecla, under construction and financed by China, which will have a seating of 50,000, and scheduled to open in 2027.
In late 2023, China’s Ambassador to El Salvador Zhang Yanhu announced the start of construction of the new soccer stadium, at a cost of more than $100 million, El Salvador Fan Club sports news reported.
“China is looking to expand its political influence throughout Latin America, trying to gain support and consolidate its presence, similar to what it does in the South China Sea region,” Luis Fleischman, a professor at Palm Beach State University in Florida, told Diálogo on October 3. “It makes this advance through soft strategies, mainly through economic investments, at a time when the continent is very divided.”
Chinese promises
Until a few years ago, China’s interest in Central America was minimal, due to the scarcity of raw materials and the region’s strong diplomatic ties with Taiwan. However, this situation experienced a radical turnaround. In 2018, lured by China’s promises, El Salvador broke ties with Taipei to partner with Beijing.
In 2019, following a state visit, Salvadoran President Nayib Bukele was awarded an honorary doctorate by Peking University. It was then announced that China would grant El Salvador $500 million in “non-reimbursable and unconditional cooperation funds,” earmarked for infrastructure projects and other works, the BBC reported.
The possibility of a port project and a special economic zone, which would cover a large part of the country, was also discussed. However, so far only minor projects, more representative of the “checkbook diplomacy” that characterizes China, have materialized. The first project inaugurated was the National Library in the Salvadoran capital.
“China has found in Bukele a financially cheap ally, satisfied with colorful works, but with no impact on the economic-social development of the country and, above all, an ally consistent with the development of anti-democratic regimes in all latitudes,” Salvadoran political scientist Napoleon campos told El Diario de Hoy.
China is currently financing three projects: a tourist pier in La Libertad, a water treatment plant in Lake Ilopango, and the National Stadium, the BBC reported. “The future of this economic relationship is shaping up to be clearly one-sided, with China reaping greater benefits. China is always going to take advantage,” Fleischman said.
All the debt
In 2022, Salvadoran Vice President Felix Ulloa said that Beijing had offered to buy “all Salvadoran debt,” although it later retracted its offer. In January 2023, Bukele announced that an $800 million bond was paid off after repurchase operations and a pension reform. China and El Salvador are currently negotiating a Free Trade Agreement (FTA), Argentine news site Infobae reported.
China has acquired foreign debts in Asian and African countries, which in practice has allowed it to exercise significant control over them, Central American think tank Expediente Público says in its report China, the Asian Giant that Could Crush El Salvador’s Economy. Negotiations around a possible FTA represent a geopolitical maneuver, which favors China’s interests, the report stresses.
“I wish El Salvador had considered what has happened in Africa with China’s intervention: exploitation of people, precarious labor conditions, and the lack of transparency with which it tends to operate before making decisions,” Fleischman said. “There are numerous problems associated with Chinese investments such as opaque contracts, poor quality materials, human rights violations, and serious environmental impacts.”
Military cooperation?
As part of its expansion strategy in the region, the Chinese government announced that it will send its first military attaché to El Salvador, marking a milestone in bilateral relations. This decision, El Salvador news site reported on May 3, comes despite the lack, so far, of formal military cooperation between both countries.
“It’s almost certain that this military cooperation has already begun. The shifts, the changes of direction in international relations usually become public when they are consummated,” Campos told El Diario de Hoy, who also believes that “it is possible that in the short term we will see the arrival of vehicles, some military equipment, as donations.”
According to Expediente Público, Central American and Caribbean countries have maintained relations for the acquisition of military equipment with their traditional partners. “These nations have not shown significant interest in acquiring Chinese military equipment. However, in a scenario of greater Chinese military involvement in the region, it is likely that their operations will be concentrated in the naval area.”
This is where the possibility that China could take over the concession for the port of La Unión Centroamericana, in El Salvador, in the Gulf of Fonseca, comes in, generating concerns about its possible military use, due to China’s interest and the lack of transparency in its management, the Center for Global Affairs and Strategic Studies of the University of Navarra indicated. El Salvador, Nicaragua, and Honduras converge in the Gulf of Fonseca.
“It is not only El Salvador. China has also gained considerable control in Panama, especially around the Canal,” Fleischman says. “This should be cause for alarm for both the United States and Latin America as a whole, for the security of the region, given China’s growing influence in strategic areas.”
“The relationship between China and El Salvador, unfortunately, seems destined to grow ever more dangerously stronger,” Fleischman concluded.
