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Carrots or sticks? Analyzing the application of US economic statecraft towards Latin American engagement with China

Published online by Cambridge University Press:  29 April 2024

Julieta Zelicovich Open the ORCID record for Julieta Zelicovich [Opens in a new window]  and
Patricio Yamin Open the ORCID record for Patricio Yamin [Opens in a new window]
Julieta Zelicovich*
Affiliation:
Julieta Zelicovich is an associate researcher at the National Scientific and Technical Research Council (CONICET), Argentina and an associate professor at the Universidad Nacional de Rosario, Argentina
Patricio Yamin
Affiliation:
Patricio Yamin is an assistant professor at Universidad Torcuato Di Tella, Argentina
*
Corresponding author: Julieta Zelicovich; Email: julieta.zelicovich@fcpolit.unr.edu.ar
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Abstract

Geopolitical competition between the United States and China has led to an increased reliance on economic statecraft. In this context, understanding the conditions that trigger trade, aid, or investment weaponization becomes crucial. This article examines how the United States has employed economic statecraft in response to Latin American countries’ engagement with China. The study revisits the theoretical debate on positive and negative economic statecraft and proposes a mechanism that identifies the conditions under which “carrots” or “sticks” are more likely to be employed. We argue that the US response towards Latin American countries’ engagement with China tends to prioritize economic engagement over economic coercion, particularly when dealing with countries that are politically and economically aligned with Washington policies. To test our argument, we adopt a mixed-methods approach. First, we conduct a case study analysis on the United States-Panama relationship. Second, we perform a statistical analysis to assess the impact of economic engagement with China on the allocation of American foreign assistance in the region.

Keywords

Economic statecraftgeoeconomic competitionLatin AmericaUnited States-China relationsBelt and Road Initiative
Type
Research Article
Information
Latin American Politics and Society , Volume 66 , Issue 4 , November 2024 , pp. 58 - 77
Copyright
© The Author(s), 2024. Published by Cambridge University Press on behalf of University of Miami

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