Bolivia has opened a steel plant financed by a Chinese loan to reduce metal import dependency. The Mutun megaproject, costing $546 million, aims to produce 200,000 tons of steel annually. It is part of China’s Belt and Road Initiative and addresses Bolivia’s economic struggles while highlighting the geopolitical tug-of-war between the U.S. and China in the region.
Bolivia has inaugurated a new steel plant, supported by a loan from China, in an effort to decrease its dependence on metal imports. The Mutun megaproject, located in Puerto Suarez near the Brazilian border, was constructed at a total cost of $546 million, predominantly funded by the Export-Import Bank of China. This investment aligns with China’s strategy to enhance its economic and political influence in South America.
President Luis Arce emphasized that the primary goal is to enable all Bolivians to benefit from a natural resource that has been underutilized for years. The plant is projected to produce approximately 200,000 tons of steel annually, which is expected to replace roughly 50 percent of current imports and avert an outflow of over $250 million in foreign currency each year, according to Jorge Alvarado of the operating public company.
Since 2023, Bolivia has faced significant economic challenges, heavily depleting its international reserves, particularly for subsidized fuel sales. The completion of this steel plant is anticipated to alleviate some of these financial strains.
China’s involvement in the project forms part of the broader “Belt and Road Initiative,” wherein President Xi Jinping seeks to extend China’s global influence. Concurrently, Latin America has surfaced as a critical arena in the geopolitical rivalry between the United States and China, with increasing pressure on countries in the region to align with one of the two powers.
The Mutun site reportedly contains more than 40 billion tons of iron ore, ranking it among the largest deposits worldwide, as per estimates from the Bolivian government.
The inauguration of the steel plant in Bolivia, funded largely by a Chinese loan, marks a significant step towards reducing reliance on metal imports and enhancing domestic production. With its substantial iron ore deposits and projected steel output, the plant aims to mitigate economic challenges faced by the country. This development also underscores China’s expanding influence in South America amidst ongoing geopolitical tensions.
Original Source: news.az
