On May 26, Venezuelan Science, Technology and Intermediate Industries Minister Ricardo Menendez announced that the Venezuelan government had reached an agreement with the Chinese government to build a second geostationary satellite.

According to Menendez, the new satellite mission will focus on monitoring the national territory and providing Venezuela with, “huge potential regarding assistance in extreme situations.”

            Venezuela, which launched its first satellite Venesat-1 in 2008, is one of the emerging markets for satellite communications in Latin America and like many countries in the region such as Bolivia, Colombia and Mexico, among others, its government has a progressive attitude towards satellite. This stance has allowed China to grow its influence in the region by providing low-cost hardware and services.

            Latin Intelligence President Maria Velez de Berliner said China’s regional investments in critical infrastructure, telecommunications, natural resources, agriculture, critical infrastructure (ports, railroads, airports), logistics, finance, banking and the environment, “show China is committed to staying in the region over the long haul. And China’s primary concerns are order and dependability of access to resources – all supported by satellites. China is now Latin America’s major strategic partner. The Chinese have the money, the technology and the long-term planning and staying power, and their focus is on investing in Latin America’s critical infrastructure,“ she says.

            Last year, China’s development bank agreed to lend Bolivia $251 million to finance the South American country’s first communications satellite – TKSat-1. The funds will be used to help pay for Bolivia’s $295 million contract with China Great Wall Industry Corp. (CGWIC) to build the satellite. The Bolivian government has agreed to put up the remainder of the funds.

The satellite is due to be launched in the next three years, will be used for communications and broadcasting services as well as for remote education and telemedicine projects. “Bolivia’s negotiations with China over China Great Wall will probably result in the cheapest satellite delivered and launched in Latin America, costing around $300 million,” Velez de Berliner says.

TKSat-1 will be based on the DFH-4 platform, which is manufactured by the China Academy of Space Technology. CGWIC estimates that TKSat-1 will be delivered to orbit in less than three years to provide communications and broadcasting services to the whole territory of Bolivia and the surrounding areas as well as facilitate the development of civil projects, such as remote education and telemedicine.

NSR Senior Analyst Patrick French told Via Satellite that Bolivia is following in the footsteps of one of its Venezuela’s footsteps and will face the same obstacles. “I would not qualify it as a landmark deal since the exact same set of circumstances existed for the Venezuelan satellite contract several years ago. Just as Venesat-1/ Simón Bolívar has not made a significant impact on the overall Latin American market, odds are the same will be true for TKSat-1. Further, one of the biggest businesses in Latin America is pan-regional cable distribution and DTH. The large broadcasters will not nor need to move off of existing cable video hot spots to serve Bolivia and any new commercial DTH service for Bolivia will hesitate to use TKSat-1, especially given that the DFH-4 platform has yet to prove it is has overcome past technical issues.”

Velez de Berliner disagreed with that assessment. “It is landmark deal in the sense that China has entered into an area previously dominated by Brazilian, American and European corporations. Like all other Latin American countries, Bolivia is diversifying its strategic alliance base. It is no surprise this involves CGWIC. China is on a well-delineated campaign to enter or expand into critical sectors of Latin America, such as telecommunications, critical infrastructure, natural resources and energy.”