Segmented leadership: Chinese and American capital in South America’s renewable energy transition

The rise of Chinese enterprises as technological competitors to established American firms represents a fundamental shift in global markets for strategic goods. This paper examines this competition through Chinese and American investments in South America’s renewable energy sector. Using 194 projects across wind, solar, hydroelectric, and biofuel technologies (2006–2024), we develop a framework for comparing investment patterns across technological segments, geographic markets, and value-chain positions. Our analysis reveals segmented leadership: complementary specialization across distinct niches rather than direct displacement. Chinese enterprises dominate capital-intensive technologies such as hydropower and wind energy, leveraging state-coordinated financing and high risk tolerance. American firms lead in specialized segments such as biodiesel and advanced solar, emphasizing innovation and market-based approaches. Geographically, China operates across a broader footprint, investing in ten countries and deploying more than twice the US investment volume, while American firms concentrate in fewer markets where they retain leadership in innovation-driven niches. Market entry is sequential, and grid functions complementary. This segmentation created parallel technological ecosystems rather than zero-sum competition, generating investment additionality for recipient countries: expanded access to financing and technologies that neither power would have provided on its own, though geopolitical tensions may alter these dynamics.