Weekly Wisdom | U.S.-Latin America Relation
Where Do They Stand?
While the Iran war and the stock market capture headlines, the Trump administration's efforts to reshape relations with the Caribbean and Latin America merit attention. President Trump's priorities in these regions are hemispheric security, American strategic influence, and deeper economic integration — a modernized Monroe Doctrine of sorts. Through this lens, we can assess the current state of affairs across Latin America and the Caribbean.
An honest assessment:
The situation in Venezuela has improved since the capture of Nicolás Maduro on January 3 of this year. Oil exports reached approximately 1.25 million barrels per day in May, up 61% from a year earlier. However, significant reforms, infrastructure investment, and foreign capital will be required to restore production to the roughly 3.5 million barrels per day the country produced in the late 1990s. Current oil production is estimated at approximately 1.1 to 1.2 million barrels per day. Regardless, the removal of a communist regime that was closely aligned with China represents a significant geopolitical advantage for the United States.
In Cuba, events appear to be moving quickly. Former president Raúl Castro was recently indicted, U.S. sanctions continue to exert significant pressure on the Cuban economy, and the Trump administration has increased its rhetoric toward the regime. In addition, the administration is pursuing compensation for Cuban Americans and U.S. corporations whose property was expropriated following the Cuban Revolution. A democratic and market-oriented Cuba could improve economic opportunities for its citizens while also advancing American strategic and security interests in the Caribbean.
Mexico remains a challenging relationship. Although President Sheinbaum has pledged to cooperate with the United States in combating the cartels, her actions often appear inconsistent with her rhetoric. Most recently, she criticized the U.S. ambassador to Mexico after he spoke out against cartel violence and influence. As America's most important bilateral relationship in Latin America, the U.S.-Mexico partnership remains vital to regional security and economic prosperity. Yet there appears to be limited progress toward a coordinated strategy for dismantling the cartels and restoring security along the border.
Since Javier Milei took office, Argentina, one of our best allies, has experienced three notable improvements: inflation has fallen dramatically, the government has achieved its first budget surplus in more than a decade, and poverty has declined from its post-reform peak as economic stability has begun to return. It is in the interest of the United States that our partners in our hemisphere embrace market economies and fair trade. Stronger economies in our partners will make for stronger allies.
Total foreign direct investment in Latin America and the Caribbean reached approximately $190 billion in 2024, the highest level on record. The United States was likely responsible, directly and indirectly, for a substantial share of that investment. Whether in the Bahamas, El Salvador, Costa Rica, or Puerto Rico, American capital continues to finance hotels, infrastructure, manufacturing, energy projects, and real estate development. These investments can create jobs, expand economic opportunities, and further integrate regional economies with the United States and the broader global market.
On June 21, Colombia may elect Abelardo de la Espriella, a conservative candidate whose law-and-order agenda has drawn comparisons to El Salvador's President Nayib Bukele. Like Bukele, de la Espriella has emphasized combating organized crime and drug cartels while expanding prison capacity and strengthening public security. If elected, Colombia could move closer to the Trump administration on issues such as cartel enforcement, regional security, and economic integration. More broadly, his victory would provide further evidence that several Latin American countries are shifting toward more conservative political leadership and tougher anti-crime policies. We can only hope the Trumpification of Latin America and the Caribbean continues.
