Incoming U.S. President Donald Trump has threated the region with tariffs and even territorial conquest.

Navigating Trump’s Threats

Although U.S. President-elect Donald Trump has yet to take office, he has made threats and staffing choices to suggest that Latin America will be a focus of his foreign policy. Dealing with the Trump White House will stretch many regional leaders’ policymaking bandwidths this year.

Trump and his advisors have focused on multiple concerns in Latin America: migration, Chinese influence, and fentanyl smuggling. Though the Biden administration often aimed to address the same issues multilaterally, Trump has brandished public threats against individual countries.

Last November, Trump suggested that he would impose a 25 percent tariff on Mexican goods if the country did not take greater action on migration and drug control. Mexico soon after announced that it had conducted its largest-ever fentanyl seizure. It is already carrying out sweeping detentions of northbound migrants and has said it would receive Mexican nationals if the United States carried out mass deportations.

Now, Trump has aimed warnings at Panama. In recent days, he has complained about fees in the Panama Canal and falsely claimed that Chinese soldiers were operating the waterway. He even threatened to reclaim the canal, which the United States transferred to Panama as part of a treaty approved under former President Jimmy Carter.

The threat of territorial conquest alarmed regional leaders. Panama is a close partner of the United States and often cooperates with U.S. foreign-policy goals. Most recently, Panama City worked with Washington to beef up migration enforcement.

Panama’s government immediately pushed back against Trump. In a public statement, President José Raúl Mulino said that the “sovereignty and independence of our country are not negotiable” and rejected the claim about Chinese control.

While Panama’s and Mexico’s tensions with Trump have unfolded bilaterally, last month’s advancement of the Mercosur-European Union trade deal can be read in part as a collective South American response to the risk of poor relations with the United States under Trump, Esteban Actis and Pablo Bertin wrote for the Argentine Council for International Relations.

Additional multilateral action may occur through other forums, such as the Organization of American States or the group that meets under the Los Angeles Declaration on Migration and Protection.

Some leaders hope to gain from Trump’s focus on the region. Argentine President Javier Milei, a libertarian, was the first foreign leader reported to speak with Trump after his election. Now, Milei is in talks with the International Monetary Fund about a new loan program. (The United States is the fund’s largest shareholder.)

When another Trump-friendly Argentine president was in office in 2018, the fund quickly granted Argentina its biggest-ever loan. Even for countries that do not share Milei’s all-in approach to Trump, the U.S. administration may present new business opportunities. But that depends on how the White House carries out its economic strategy.

Mauricio Claver-Carone, whom Trump has named as his special Latin America envoy, argued for robust steps to encourage new U.S. investment in Latin America in a July 2024 article for Americas Quarterly. They include U.S. government funding for regional infrastructure and a clearer pathway to join free trade deals like the U.S.-Mexico-Canada Agreement. But it’s unclear whether the U.S. Congress would approve those plans.

Trump and his top advisors have spoken frequently about their desire to push back against Chinese influence in Latin America. But Trump’s first term also showed how heavy-handed measures such as tariffs can be counterproductive: Many countries strengthened ties with China as a balancing measure.

Climate Opportunities

Multiple climate disasters in the region in 2024—including droughts, floods, and hurricanes—generally failed to produce a serious focus on climate in Latin American politics. This year, a few leaders who claim to be environmentalists will have key opportunities to prove it.

The 2025 United Nations climate change summit, known as COP30, will be held in Belém, Brazil, in November. After last year’s summit in Azerbaijan produced a vague agreement on its main objective—climate finance—Brazilian negotiators will be in the spotlight to shepherd a more ambitious deal.

Ahead of the conference, countries face a deadline for submitting updated plans to reduce greenhouse gas emissions as part of the U.N. framework. Colombia and Brazil will have the chance to present progress on green investment portfolios that they launched in 2024.

The new year will also show if there is any teeth to Mexican President Claudia Sheinbaum’s pledges to build out the country’s green electrical infrastructure. Sheinbaum, a former climate scientist, took over from Andrés Manuel López Obrador, who revived coal-fired power plants.

In a move with regional implications, Chinese carmakers BYD and Great Wall Motor are set to start assembling cars in Brazil this year—although BYD’s plant was recently put on pause due to a forced-labor probe.

An uptick in production could push down the price of electric vehicles across Latin America. Sales of electric passenger vehicles doubled in the region from 2023 to 2024, but they still remained under 7 percent of all passenger car sales, according to BloombergNEF.

New Security Cooperation

As organized crime plagues Latin America, law enforcement agencies from several countries have pledged to share more information with one another and roll out new strategies via a partnership launched last month with groups including the Inter-American Development Bank (IDB), the World Bank, the Caribbean Community (CARICOM), and Interpol.

Eighteen countries have signed on, although Mexico and Colombia are not among them. The IDB says it will direct $1 billion this year to evidence-based security strategies. Last September, the IDB’s Nathalie Alvarado told Foreign Policy that the bank supports moving “from reactive and repressive policies, which is the norm, to policies that are much more proactive and preventive.”

The partnership offers organizational and financial muscle to monitor and consult on security policies multilaterally—something that has been rare in the region in the past.

One of the new partnership’s first projects is in Ecuador, where a dramatic increase in organized crime has transformed life across the country in recent years. Last January, Ecuadorian President Daniel Noboa declared a war on crime; voters will have their say on its effectiveness, among other policies, in the country’s February presidential election.

Hazards in Haiti

This year, Western Hemisphere nations and the international community will show what kind of security guarantees they can offer Haiti after a largely U.S.-funded, Kenyan-staffed security mission has failed to resolve the country’s protracted crisis.

That mission began deployment in mid-2024 amid cautious optimism. Haiti had just named a new transitional governing council and prime minister following a leadership impasse. But the second half of the year brought more political infighting, few additional international forces, and gang takeovers of neighborhoods in the capital of Port-au-Prince—precisely what the security mission was supposed to prevent.

Haiti’s interim authorities, several Latin American countries, the Biden administration, and a handful of other countries and nongovernmental organizations have called for the current international force to be transformed into a peacekeeping mission funded and run by the U.N., which they say would provide the potency missing from current efforts.

China and especially Russia have resisted such a step in the past. Amid broader geopolitical tensions, they have often criticized U.S. positions on Haiti. But urgings from interlocutors such as Brazil, which supports a U.N. mission, might help sway Beijing and Moscow.

Even so, it’s unclear whether the Trump administration would back a U.N. mission, despite the fact it would remove some responsibility from the United States’ plate. Last November, a Trump transition spokesperson did not respond to questions from the Washington Post about whether Trump would back the existing mission or a U.N.-run one.

Brazil’s BRICS Presidency

Brazil is serving as the rotating president of BRICS this year and will host the group’s leaders’ summit, which is tentatively scheduled for July. It is Brasília’s big chance to influence the bloc’s direction as it expands. The growth of BRICS has put founding member Brazil at risk of being an even smaller player compared with fellow co-founders China and Russia.

Brazil’s office of the presidency said Wednesday that its five main priorities for BRICS this year were facilitating trade and investment, promoting responsible artificial intelligence governance, refining methods of climate finance, increasing south-south cooperation with a focus on public health, and institutionally strengthening the group.

Brazil has tried to advance many of these issues in other forums, most recently at the G-20 summit in November. The agenda suggests that Brazil hopes to mobilize BRICS around economic and climate challenges facing developing countries. Concrete progress on these fronts may help chip away at Western perceptions that BRICS is primarily a club of U.S. antagonists.

BRICS’s goal of growing its non-dollar trade has already landed the grouping in Trump’s firing line. The U.S. president-elect threatened a 100 percent tariff against countries that created a rival currency to the dollar. No such project is realistically moving forward; rather, BRICS countries are gradually increasing trade in local currencies.

by Catherine Osborn

Credits: foreignpolicy.com