US backyard on fire? After Brazil, another turns to China

Chile's President Kast sat down with China's ambassador Niu Qingbao last Friday. The meeting at the presidential palace ran over an hour. It was the first face-to-face contact since the right-wing leader took office in March. 

Chile's President Kast

Just one day before the meeting, the US Trade Representative's office confirmed a 12.5% tariff on Chilean imports. 

According to the presidential palace, Kast, Foreign Minister Makena, and Deputy Foreign Minister Torres used the meeting to review the bilateral agenda. 

They also discussed the foreign minister's upcoming visit to China and preparations for the president's attendance at the APEC Leaders' Meeting in Shenzhen on November 18-19.

APEC Leaders' Meeting

Washington's justification? Chile hasn't banned imports of goods made with so-called 'forced labor.' Copper, Chile's biggest export, got a pass. But salmon, timber, and food took a direct hit. 

The tariff plunges Kast back into a dilemma: caught between the two economic superpowers that dominate his country.

Kast won the presidency last November with just over 58% of the vote. His campaign playbook? Borrow heavily from Donald Trump. He promised a border wall with Bolivia and a crackdown on crime, which he pinned on Venezuelan immigrants.

But since taking office in March, his strategy of aligning with the US has already run into trouble.

Weeks before leaving office, outgoing left-wing President Gabriel Boric quietly approved a submarine cable project, operated by a Chinese company. The 19,873-kilometer cable would connect Chile directly to Hong Kong, with a 30-year concession. 

The then-minister of transport and telecommunications signed the decree on January 27. But after a warning from the US Embassy in Chile, he revoked it two days later, citing a 'typographical error.'

Washington wasn't done. In late February, US Secretary of State Marco Rubio slapped visa restrictions on three Chilean officials, accusing them of backing activities that threatened the security of critical telecom infrastructure. 

US Secretary of State Rubio

Boric later confessed that he personally ordered the revocation after receiving explicit threats from Washington. The threats included possibly removing Chile from the US Visa Waiver Program: the only South American country in it.

At the time, Chinese Ambassador Niu Qingbao publicly defended the cable project. He called it a mutually beneficial, win-win idea, and accused the US of making baseless claims about so-called strategic risks.

The numbers tell a clear story. Chile sends 37% of its exports to China: copper, lithium, lemons, cherries. And about a quarter of its imports come from China. Last year, two-way trade hit $65.33 billion. 

37% of Chile's exports go to China: copper, lithium, lemons, and cherries.

Yet, the United States remains the largest source of foreign direct investment in Chile, with a cumulative $12.5 billion, versus $4.6 billion from China, according to the Economic Commission for Latin America and the Caribbean.

Washington's tariff decision has rattled the ruling coalition, too. Agriculture Minister Campos and Defense Minister Barros both publicly slammed the move. On Thursday evening, Senator Squella, president of the Republican Party founded by José Antonio Kast, told CNN Chile that the tariffs prove Chile has gotten almost nothing in return for its overtures to Washington.

Squella didn't mince words. "A huge effort has been put into having the best possible relations with the United States," he told the media, "only for them to pull some sort of forced labour claim out of a hat." 

When the conversation turned to Chinese investment in Chilean ports, Squella drew a sharp line between ordinary trade and strategic assets. In some areas, he argues, Chile must be wary of capital or investors that don't align with national interests. However, Chile still lacks the institutional norms to handle such situations.

But set aside those reservations, and his views on China and the United States come into sharp focus. "If you ask me which one I would like to go deeper with, in terms of doctrine or of how a society should be run, obviously I see the United States as much closer," Squella said. Then he added a twist: "But I have no recollection of China creating difficulties or failing to respect the rules of the game."

The incident has forced Squella to reassess the real value of cozying up to Washington. "It seems there is not much point in making so much effort to have a good relationship if in the end they arrive and out of nowhere impose tariffs on us that hit us at the waterline, in activities that are fundamental to us," he said.

Deep Throat

** 博客文章文責自負,不代表本公司立場 **

The US government on Tuesday, July 28 local time, announced a ban targeting new Chinese robots and inverters. Reuters reported that the Federal Communications Commission （FCC）updated its "Covered List" to include foreign-made "advanced robotic devices," such as humanoid and quadruped robots, as well as network-connected power inverters. Washington says the measure will shield US artificial-intelligence development from alleged national-security threats and bring manufacturing in critical industries back to the United States.

The FCC said the equipment could expose vulnerabilities in supply chains, potentially disrupting the US economy and national security. The agency also said the products could create cybersecurity risks and threaten critical infrastructure. FCC Chairman Brendan Carr said: "The FCC will continue to do our part to secure America's critical supply chains."

The United States has announced a ban targeting new Chinese robots and inverters.

The FCC measure applies only to new models of the affected equipment. It does not bar people from using existing devices,  prevent retailers from selling already authorized models, nor affect federal procurement and use. But the FCC retains the authority to revoke approvals already granted to models sold in the US market.

Politico said the move fits two central priorities of Trump’s second presidential term. One is to curb China’s competitiveness in AI. The other is to prevent China’s clean-energy sector, already dominant globally, from continuing to rise.

An interagency group in the Trump administration concluded that the technologies could threaten US supply chains, according to the report. Its concerns include the possibility of triggering large-scale blackouts or enabling surveillance of US citizens.

The stakes rise as the United States builds AI data centers at scale. Analysts told Reuters that grid-connected inverters are becoming increasingly important because they link renewable-energy sources, battery storage, the power grid, and data-center facilities. A supply disruption or cyber intrusion could undermine data-center operations and the security of critical infrastructure.

Humanoid robots are also moving into industrial, research, and consumer markets. Because they carry cameras, sensors, and AI computing systems, US officials worry that foreign intelligence agencies could exploit the data they collect. They also fear malicious actors could seize remote control of the machines.

Four people familiar with the matter said the FCC is expected to exempt many non-Chinese suppliers from the restrictions. That would mirror recent US bans involving foreign drones and routers.

The robot ban is expected to hit China’s Unitree Robotics, according to Counterpoint Research. Unitree is a global leader in humanoid robots, holding nearly one-fifth of the worldwide market. The Pentagon recently added the company to its so-called “Chinese Military Companies List,” a move that could signal tougher US action ahead.

Unitree Robotics’ latest breakthrough humanoid robot.

Unitree recently partnered with Nvidia, which will use its advanced Blackwell chips to provide the “brains” for Unitree’s robots. Nvidia has said the robots’ data will remain in the United States. Unitree’s largest customers are US academic and research institutions.

Morgan Stanley analysts predict that the humanoid-robot market could reach $5 trillion by 2050. The Trump administration’s import ban may give US companies a competitive advantage.

Morgan Stanley analysts predict that the humanoid-robot market could reach $5 trillion by 2050.

The Washington Post said Trump’s sons have also entered the humanoid-robotics sector. They have invested in defense and robotics companies focused on US-based production.

The US government has spent recent years trying to reduce its dependence on Chinese-made equipment, citing national security.

The Chinese Embassy in the United States urged Washington to stop smearing Chinese companies and threatening them with sanctions. It said China would take all necessary measures in response to actions that harm Chinese interests.

A Chinese Foreign Ministry spokesperson has previously said that China firmly opposes the US side’s overbroad interpretation of national security, its creation of discriminatory lists under various pretexts, and its unjustified suppression of Chinese companies.

The spokesperson urged the United States to correct its erroneous practices and end its unreasonable crackdown on Chinese enterprises. China, the spokesperson added, will take necessary measures to firmly safeguard the legitimate rights and interests of Chinese companies.