Bolivia's state steel company is threatening to deduct losses from its Export-Import Bank of China loan after a dispute with the Chinese engineering firm that built its flagship plant. The steelmaker claims the mill has lost $100 million since opening, creating a standoff with its primary lender.

This feud highlights the growing tensions between Bolivia and China over infrastructure projects in South America. The steel plant represents a significant investment in Bolivia's industrial capacity, but operational issues have plagued the facility since its construction. The dispute could set a precedent for how developing nations handle problematic Chinese-funded projects.

The potential deduction would mark an unusual move in international lending, particularly with state-backed Chinese banks. If Bolivia proceeds with this strategy, it could strain diplomatic relations and complicate future infrastructure financing from China. The outcome will be closely watched by other countries with similar Chinese-funded projects facing operational challenges.