Connection refused on ec2 between two servers on same machine

I have an angular app and a mongo app (a REST api). Both are on the same machine. When I try to use an API method, I get

Failed to load resource: net::ERR_CONNECTION_REFUSED      http://ift.tt/1webEKM

The angular app is listening on port 3000 (so nginx routes www.mywebsite.com requests to port 3000). This part works. However, the app talks to a server on the same machine on port 1234 (the REST api). This is where it fails.

I'm using nginx to route the requests.

user www-data;
worker_processes 4;
pid /run/nginx.pid;

events {
        worker_connections 768;
        # multi_accept on;
}

http {

        # www.mywebsite.com
        upstream api {
                #api REST server
                server localhost:1234;
        }

        server {
                server_name mywebsite.com;
                listen 80;

                location / {
                        #Angular app
                        proxy_set_header X-Real-IP $remote_addr;
                        proxy_set_header Host      $http_host;
                        proxy_pass         http://127.0.0.1:3000;
                }
        }



        ##
        # Basic Settings
        ##

        sendfile on;
        tcp_nopush on;
        tcp_nodelay on;
        keepalive_timeout 65;
        types_hash_max_size 2048;
        # server_tokens off;

        # server_names_hash_bucket_size 64;
        # server_name_in_redirect off;

        include /etc/nginx/mime.types;
        default_type application/octet-stream;

                                                                                                                                                        1,1           Top
        ##
        # nginx-naxsi config
        ##
        # Uncomment it if you installed nginx-naxsi
        ##

        #include /etc/nginx/naxsi_core.rules;

        ##
        # nginx-passenger config
        ##
        # Uncomment it if you installed nginx-passenger
        ##

        #passenger_root /usr;
        #passenger_ruby /usr/bin/ruby;

        ##
        # Virtual Host Configs
        ##

        include /etc/nginx/conf.d/*.conf;
        include /etc/nginx/sites-enabled/*;
}



#mail {
#       # See sample authentication script at:
#       # http://ift.tt/1izWoAw
#
#       # auth_http localhost/auth.php;
#       # pop3_capabilities "TOP" "USER";
#       # imap_capabilities "IMAP4rev1" "UIDPLUS";
#
#       server {
#               listen     localhost:110;
#               protocol   pop3;
#               proxy      on;
#       }
#
#       server {
#               listen     localhost:143;
#               protocol   imap;
#               proxy      on;
#       }
#}