The end of the 'Washington consensus'

[Judi Lynn]

The end of the 'Washington consensus'
For decades, the US was able to dominate Latin America with trade deals. Now China offers a new model of development
Kevin Gallagher guardian.co.uk,
Monday 7 March 2011 16.38 GMT

Colombian President Juan Manuel Santos sent shockwaves through Washington when he told the Financial Times that his nation is holding negotiations with China to build a multibillion dollar "dry canal" that would compete with the Panama Canal. After all, Santos said, China is "the new motor of the world economy".

This deal is charged with politics. Colombia is trying to get the US to pass a long-stalled trade deal. And let us not forget that the original canal was to be the result of an agreement between the US and Colombia. When the Colombians didn't like the deal the US had on offer and threatened to squelch it, Washington supported Panamanian separatist movements and got itself a new country to build a canal with.

But that's all water under the isthmus. Or so we thought.

Whether or not this deal goes through, it highlights the stark contrast between China's foreign economic ventures and those of the United States.

For 30 years, Washington has been shopping a trade-not-aid based economic diplomacy across Latin America and beyond. According to what is generally known as the "Washington consensus", the US has provided Latin America loans conditional on privatisation, deregulation and other forms of structural adjustment. More recently, what has been on offer are trade deals such as the US-Colombia Free Trade Agreement: access to the US market in exchange for similar conditions.

More:
http://www.guardian.co.uk/commentisfree/cifamerica/2011/mar/07/china-usa