Donald Trump, the 45^th US president, broke with decades of a relatively bipartisan foreign policy consensus by wreaking havoc on US bilateral relations with China and the European Union. Latin America was an exception to the Trump playbook.

It is true that US relations with Mexico were rocky during the beginning of the Trump administration. Immigration from Central America and Mexico was a bone of contention. Paradoxically, despite a tumultuous beginning, both leftist Mexican President Andres Manuel Lopez Obrador and Trump found a strong common ground to work together. In fact, Lopez Obrador developed a close relationship with his US counterpart.

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The Mexican president might even have wanted Trump reelected. AMLO, as Lopez Obrador is popularly called in Mexico, took longer than most world leaders to recognize Joe Biden’s election victory in November 2020. Curiously, AMLO and Brazilian President Jair Bolsonaro recognized Biden’s win after hesitating for six weeks and receiving much criticism. The AMLO-Trump camaraderie indicates that Trump made no radical break in US policy toward Mexico despite his inflammatory rhetoric.

The same holds true for Venezuela. Trump regularly called for action against this oil-rich nation and threatened military intervention, but the main thrust of his policy was to tighten sanctions imposed by his predecessor, Barack Obama. Only with Brazil and Colombia did Trump change US policy somewhat. Trump saw Bolsonaro as a fellow populist of the right and embraced the Brazilian leader in a manner previous administrations would not have. Trump was also very supportive of the right-wing government of Colombia because of ideological reasons. 

What Issues Need Urgent Attention?

Unlike US policies toward the EU, China and Iran, President Biden’s Latin America policy does not need radical redefinition. Yet the Biden administration will have to address some issues in the short term and others in the medium or long term. 

There are three pressing short-term issues in the region that will require Biden’s attention. The first is the US border problem with Mexico. If Mexican authorities stop the flow of immigrants from Central America, the United States will have less of a crisis on its southern border. The second issue is the shoring up of weakened regional institutions, especially the Organization of American States (OAS) and the Inter-American Development Bank (IADB). The third issue involves developing a comprehensive policy to manage the Venezuelan crisis. 

The first issue involving the southern border has reached crisis proportions because Mexico and Central American states have responded inadequately to the COVID-19 pandemic. There is also a public perception in these countries that the US will pursue a more open-border policy under Biden, leading to immigrants flocking to the US. The border issue has dented Biden’s popularity and many Americans believe it has not been handled well. In fact, March was the worst month in US history regarding the number of child refugees knocking at the US border. It was nearly 19,000 in that month alone.

The key to any solution is held by Mexico. The country controls the flow of immigrants from Central America and can restrain people from reaching the US border. During the last three years of the Trump administration, the United States and Mexico had an informal agreement, as per which the latter served as a secondary gatekeeper for the US border. Mexico regulated the flow of immigrants to the US border and even absorbed significant numbers of migrants itself. This mechanism stopped as soon as Biden entered the White House. Mexico would use the resuscitation of this mechanism as leverage to gain concessions on other issues. 

On December 29, 2020, the US Department of Homeland Security announced that Guatemala, El Salvador and Honduras had signed the Asylum Cooperation Agreement (ACA). The ACA was significant because more than 71% of migrants apprehended on the US southwest border came from these three countries. The ACA aimed to confront “illegal migration at the source” from a region in Central America that has come to be known as the Northern Triangle. Waves of migrants are fleeing poverty, violence and other challenges in this region and making their way to the US. The longer-term solutions that stop such waves of migrants will require resources to mitigate poverty and violence and will have to wait. 

The second issue facing the Biden administration is restoring the influence of the OAS and the IADB. During the 1990s and the 2010s, these two organizations increased in importance. They were able to promote democracy and economic growth in the region. The OAS played a key role in political crises such as Peru in 1992 and Honduras in 2009. The Inter-American Human Rights Commission and Inter-American Court of Human Rights, two institutions created by the OAS, promoted and protected human rights in the American hemisphere. In recent years, both the OAS and the IADB have weakened.

The late Venezuelan leader Hugo Chavez and his allies created new regional organizations to counter the OAS and the US. These organizations, such as UNASUR, ALBA and CELAC, sought to limit US influence in the region. Today, they have withered away. Yet the polarization in the region has chipped away at the credibility of the OAS. Its capacity to mediate in conflicts or mobilize the region on important issues has been affected. The OAS has been largely silent on the COVID-19 pandemic, raising questions about its irrelevance.

As well as the OAS, the IADB was born with very strong regional roots. By the end of the 20^th century, the bank incorporated new members from outside the region. European nations, Japan and even China joined the IADB. Political controversies have plagued the organization for years. In recent times, they have gotten worse.

In 2019, Venezuela’s opposition leader, Juan Guaido, whom many countries recognized as interim president, appointed Harvard University economist Ricardo Hausmann as the country’s representative to the IADB. China sided with Nicolas Maduro’s Venezuelan regime and barred Hausmann from attending the IADB meeting in Chengdu. In response, the IADB canceled its meeting in China that was meant to mark its 60^th anniversary. Needless to say, recent developments have weakened the IADB.

The Biden administration will need to relaunch both the OAS and the IADB. Washington will have to restore their credibility and efficacy. Both organizations will be essential for solving the longer-term issues facing the region.

The Venezuela Conundrum

The third issue that the Biden administration has to address is Venezuela. As per many analysts, the country is on the brink of collapse. Criminal gangs and other armed non-state actors control not only remote parts of Venezuela but also shantytowns and working-class neighborhoods in the national capital, Caracas. The economy is in a dire state. US economic sanctions and reserves mismanagement have led Venezuelan oil production to fall to its lowest level since the 1940s.

After low figures of infection in 2020, COVID-19 has now spiraled out of control. In per capita terms, Venezuela has vaccinated the least number of people in Latin America. Even Haiti is doing better. As per The Lancet, “Venezuela does not have a known national COVID-19 vaccine plan, and the supply of vaccines is spasmodic, insufficient, and unplanned.” The reputed publication also observes that “the health-care system has collapsed and is incapable of responding to the ever-increasing number of patients who require hospitalisation.”

Maduro has rejected most plausible options for mass vaccination. Only the Venezuelan elite, Maduro’s close supporters and the regime’s Cuban advisers have been vaccinated. The government rejected a deal with opposition leader Guaido to import the AstraZeneca vaccine through the COVAX mechanism of the United Nations at the last minute. Despite popular clamor for mass vaccination, it is unclear how the process will advance even though the funding for vaccination is available.

Hunger has been on the rise and diseases like malaria are back. Such is the dire state of affairs that Venezuelans are fleeing the country. Over 5 million of them have left. This has led to the worst refugee crisis in the Western Hemisphere and rivals the Syrian crisis. Countries in Latin America have largely been hosting these refugees, but they are increasingly overstretched. Emulating the Biden administration, Colombia has designated “temporary protected status” for Venezuela.

The Maduro regime has lost control of the country. Its military strikes against armed groups are only exacerbating an already terrible situation. The military’s offensive against Colombian illegal armed groups near the Venezuela-Colombia border has led to more Venezuelans fleeing the country. Venezuela’s recent economic measures to revive the economy such as reversing Chavez’s total control over PDVSA, the state-owned oil company, and privatization of a selected number of state-owned enterprises have not worked. The government suffocates business and has no talent for economic management.

Paradoxically, the COVID-19 pandemic has benefited the government in one significant way. By imposing a radical quarantine, the Maduro regime and its cronies exercise tight social control over the population’s movements in areas of their control. After putting the ruling elite in a difficult position and isolating it internationally during 2019 and the first quarter of 2020, the opposition has run out of steam. Nominally led by Guaido, the opposition is highly fragmented and has failed to come up with a common strategy.

Trump’s “maximum pressure” policy of using sanctions to topple Maduro’s regime did not work. Cuba, Russia and China have ganged up to support Maduro and ensure his survival even as Venezuela increasingly becomes a failed state. The Biden administration needs fresh thinking and a new strategy for a state that is threatening the stability and security of Latin America.

What Are the Long-Term Challenges?

If short-term prospects are grim for Latin America, then the mid-term ones are anything but rosy. The commodities boom that enabled the region to grow continuously for nearly two decades is over. This boom brought tens of millions out of poverty. As per the International Monetary Fund, Latin America bounced back from the COVID-19 in 2020, but the pandemic’s resurgence “threatens to thwart an uneven recovery and add to the steep social and human costs.”

Countries like Peru, which managed to grow at high rates despite a dysfunctional political system, have plunged back into grinding poverty and, lately, political chaos. The prospects in most other Latin American countries are similar. Economic hardship will inevitably heighten social and political tensions. Over the last two decades, many protests that mushroomed across the region against corruption or injustice quietened as public services improved. When the pandemic recedes, these protests may come back with a vengeance, reclaiming the relative prosperity the people have lost.

Economic woes might also create new perils for democracy. Already, there is a worldwide trend of declining democracy. In Latin America, countries like Brazil, El Salvador and Nicaragua are worrisome examples of this trend.

Bolsonaro, the populist right-wing politician, famously won the Brazilian election in 2018 on an anti-corruption agenda that implicated a host of politicians, including former President Luiz Inacio Lula da Silva, who was the most popular politician in decades and whose policies brought millions out of poverty. Bolsonaro has rolled many of those policies back. More importantly, he has mishandled the COVID-19 pandemic. More than 490,000 Brazilians have died. This number is the second-highest after the US. With more than 17.5 million confirmed cases of COVID-19, Brazil ranks third-highest in the world. Protesters blame Bolsonaro’s disastrous policies from downplaying the threat of COVID-19 and opposing lockdowns to mishandling vaccination and causing the near-collapse of the health system.

In El Salvador, President Nayib Bukele has strengthened his grip over the legislature and the judicial system. His party has voted to “remove the magistrates of the constitutional chamber of the Supreme Court.” Earlier, Bukele ordered heavily armed troops to occupy the parliament to pressure legislators into voting to better equip the troops. 

If the threats to democracies in Brazil and El Salvador come from the right, those to Bolivia and Nicaragua come from the left. In Bolivia, former President Evo Morales began dismantling democratic institutions when he sought to win a fourth consecutive term in 2019. In doing so, he contravened the provisions of the constitution. Bolivians had voted against Morales’ attempt to amend the constitution so that he could run for a fourth term, but he got around this vote by appealing to the nation’s highest court that was packed with his cronies. After a disputed election, Morales fled to Mexico after the military asked him to stand down, and Jeanine Anez took over as interim president. Anez promptly set out to persecute and prosecute Morales and his supporters.

Another election followed in 2020 and the socialist candidate Luis Arce won. He had served as economy minister under Morales. As president, Arce has turned upon Anez and other political rivals. They have been arrested for participating in a coup against Morales. This cycle of political vendetta has left Bolivia highly polarized, and the country’s political crisis is far from over.

In Nicaragua, the decades-long president, Daniel Ortega, just recently imprisoned the four most important contenders of the opposition, in practice moving into a one-party system. Mexico also faces challenges too, but in more milder forms.

Finally, there remains the thorny issue of Cuba that every US president since John F. Kennedy has had to face. In 2016, Barack Obama tried to turn back the clock on the Cold War by visiting Cuba and inaugurating a new era of engagement. Trump reversed almost all of Obama’s policies. Now, Biden has to craft a new policy on Cuba, a country that remains influential throughout the region. Along with Venezuela, Cuba is a magnet for attracting the attention of the two big external powers: Russia and China. This tripartite meddling of Russia, China and the US in Latin America could sow instability in the region.

Already, Cuba is facing its worst economic crisis since the fall of the Berlin Wall in 1989. The new generation of Cubans has lost faith in the communist regime. The Cuban leadership is going through a highly choreographed transition of power to a younger generation. Given the flux, the Biden administration would be well advised to bide its time. Eventually, it may want to craft a new policy that avoids the bitter confrontation of the Trump era and the open engagement of the Obama years.

In the long-term, the Biden administration needs a robust OAS and a strong IADB to restore democracy and rebuild the economy in Latin America. The region will need a robust reconstruction plan once COVID-19 recedes. If the US ignores Latin America, Russia and China will continue to make inroads. They will undermine the relative stability Latin America has enjoyed for the last few decades. Biden has no choice but to pay attention to a region that lies in the same hemisphere as the US and remains crucial to American strategic calculus.