China’s impact on the political economy of the Andean Region : a comparative analysis of Bolivia and Peru
The rise of China has been one of the most significant transformations of the global political economy in the twenty-first century. As China’s demand for energy, minerals, and agricultural commodities expanded, Latin America experienced a renewed cycle of export-led growth driven by extractive activities. Bolivia and Peru emerged as two of the countries most deeply integrated into this process, benefiting from rising commodity prices, increasing trade flows, and growing Chinese engagement through investment and finance. Despite these shared structural conditions, however, the two countries followed markedly different development trajectories. This dissertation investigates how China’s renewed economic presence influenced the political economy of development in Bolivia and Peru and seeks to explain why a common extractivist model produced divergent outcomes. The study adopts a comparative historical approach covering the period between 2000 and 2023. It combines quantitative analysis of trade, foreign direct investment, fiscal indicators, and socioeconomic data with qualitative evidence drawn from policy documents, legislation, secondary literature, and elite interviews. The research is situated within the tradition of critical political economy and integrates insights from World-Systems Theory, Dependency Theory, and Geopolitics and Development theory. While the first two approaches provide a framework for understanding the structural position of resource-dependent economies within global capitalism, Political Settlement Theory allows for an examination of how domestic power relations mediate external economic influences. The dissertation argues that China’s influence did not determine development outcomes directly. Rather, its effects were filtered through distinct domestic political settlements that shaped the generation, distribution, and use of extractive rents. In both countries, Chinese demand reinforced commodity specialization and intensified extractivist accumulation. However, differences in state strategies and governing coalitions produced contrasting outcomes. In Bolivia, the commodity boom supported what is conceptualized as a **Redistributive Rentier Settlement**, characterized by strong state intervention, resource nationalism, and the redistribution of rents through social policies. This model contributed to significant reductions in poverty and inequality but also increased dependence on commodity revenues and generated growing macroeconomic vulnerabilities. In Peru, by contrast, a **Stability-Oriented Rentier Settlement** prioritized macroeconomic discipline, private investment, and export competitiveness. This strategy produced sustained economic growth and greater resilience to external shocks but failed to address persistent territorial inequalities and social conflicts associated with extractive activities. The findings demonstrate that China’s rise did not fundamentally alter the structural position of Bolivia and Peru within the global economy. Instead, it reconfigured existing forms of dependency by deepening commodity specialization and reinforcing extractive development. The dissertation contributes to debates on development, dependency, and the political economy of natural resources by demonstrating the importance of domestic political settlements in mediating global economic transformations. It also advances World-Systems Theory by incorporating the role of national institutions and political coalitions in shaping development trajectories. Ultimately, the study argues that sustainable development requires not only favorable international conditions but also political and institutional arrangements capable of transforming resource wealth into diversified and resilient economic structures.