Latin America's Evolving Strategic Panorama
Latin America and the Caribbean is the region that most directly impacts US security and prosperity both for good and bad, through flows of people and goods. That interdependence includes supply chains vital to the US economy and global competitiveness, but also potential threats such as drug flows, other criminal activities, and access through the region by US geopolitical adversaries such as the People’s Republic of China (PRC). A significant majority of countries in the region are currently disposed to work with the US on security and other issues. Many have partially restrained some of their security engagement with the PRC and cooperation in other sensitive areas in response to US pressures. Despite such an apparently US-accommodating posture, however, the region is currently beset by an dangerous confluence of stresses that could undermine its stability, US-friendly orientation and disposition to cooperate, and its restraint in working with extra-hemisheric US adversaries.
A major new survey, “AMLAT Radar” reports that little more than half of the respondents in the region support adherence to democratic processes if non-democratic alternatives promise better solutions to endemic problems. The region’s residents have grown skeptical over decades of the performance of their governments on fundamental issues such as corruption, addressing insecurity, and providing economic and other opportunity. Similarly, confidence in the reliability and fruitfulness of democratic expression has been undermined by social media and artificial intelligence. Expanded reliance on vehicles such as Tic Toc, WhatsApp and Instagram as news sources has contributed to an atomized and polarized information environment in which people consume news tailored to their biases, even while AI expands already profound lack of confidence regarding what is real and what is not.
Mixed feelings about democracy in the region have also arguably been deepened by significant changes in the discourse, policies, and actions of the US as its traditional standard bearer. Meanwhile, as the PRC has deepened its commercial and other activities in the region, it has sought to position itself as an alternative partner, and its superficially less intrusive concepts of global governance as alternatives to the “rules-based international order.” Even if most Latin Americans have remained skeptical of the PRC while embracing the economic and other opportunities it seems to offer, conversations about democracy and the US in the region have been profoundly impacted by perceptions of a government-led PRC “model” producing apparent economic progress, efficiency and order, at the price of sacrificing individual rights and protections to its authoritarian system and associated technologies.
Reflecting changing Latin American perceptions of China and the US, the AMLAT Radar survey shows that for the first time, China, not the US, is seen as the best model for development by those responding, with the number choosing China, 36%, increasing 7 percentage points since the last survey in 2022, while those choosing the US fell 13 percentage points. In specific areas, 49% of respondents chose the PRC as the best partner for trade, versus 26% electing the US. Even more notably, 67% chose China as the best partner for digital technologies, while only 19% chose the US in this category. Even in the domain of culture and education cooperation, 40% chose China as the best partner, while only 18% chose the US, whose cultural appeal for the region has historically been considered a key lever of “soft power.”
Beyond questions of democracy and US-PRC rivalry, the war in Iran has also strained the region through increased oil prices, particularly affecting net petroleum-importing countries such as those in Central America and much of the Caribbean. Such price increases particularly harm marginalized populations such as truckers and taxi drivers who must purchase their own fuel. It also increases costs for households through elevated prices for heating oil and cooking gas. Indeed, in several countries, including Chile and Bolivia, these impacts have been compounded by the recent elimination of fuel subsidies maintained by prior governments, just as petroleum prices are now taking off. Such increases have begun to generate public protests, just as they did when oil prices spiked in 2022 following Russia's invasion of Ukraine.
As a compliment to economic instability and other factors, transnational organized crime (TOC) has been a key contributor to undermining regimes and confidence in democracy in the region, principally through fueling corruption and public insecurity. The corrosive impact of TOC is a function not only of drug production, transport, distribution and consumption, but also lucrative illegal mining economies, human smuggling and trafficking, extortion and other gang activities, as well as less commonly recognized crimes from timber smuggling to trade and exotic flora and fauna. The explosion in Colombian cocaine production, particularly during the present government of Gustavo Petro, has impacted the entire region, including expanded narco transits through neighboring Venezuela and Ecuador, Mexico, Central America and the Caribbean to the north. Cocaine from Colombia, Peru and Bolivia, and synthetic drugs such as methamphetamines, also increasingly flow to markets in Europe and Oceana where prices are higher. These markets have expanded drug flows through South America to Asia and Europe, attracting an array of interaction criminal groups, from Mexican and European foreign facilitators to major South American groups such as the First Capital Command (PCC), the Red Command (CV) and their surrogates, to violent local gangs, expanding corruption, fights over routes, and other adverse effects in parts of South America that do not always receive the focus of Washington.
Although U.S. military action has removed Nicolas Maduro in Venezuela, the criminal networks for illegal drugs, mining, human smuggling and extortion and other crime still exist. Continuing lethal US interdiction operations in the Caribbean and eastern Pacific, with 50 narcoboats destroyed and 186 fatalities at the time of this writing, have significantly lowered such activity. Still, traffic has shifted to more southerly routes, through the interior of Venezuela and Colombia to Venezuela to Brazil, through Peru and Bolivia through Brazil, and Argentina to Europe, among others.
Similarly, although US actions and increased control of the southern border have decreased overdose deaths in the US, fentanyl shipments to the US, and synthetic drug flows to the European and Oceana market through the region continue.
In migration, the exodus of 9 million Venezuelans from that country has put enormous social pressures on the countries that have received them from Colombia to Ecuador to Peru to Chile and the Caribbean, with no near term prospects that political conditions in Venezuela will change enough in the near term for them to return. The continuing crisis of gang control and associated violence in Haiti, and significant US economic pressure on Cuba, each similarly presents continuing risks for an expanded outflow of refugees from those countries, impacting neighbors in the Caribbean and the broader region.
The advances in technologies and new networks available to criminals further compound the challenges they pose to the region. This includes the use of cryptocurrencies. While these are technically trackable, doing so requires special training and capabilities scarcely available to most Latin America law enforcement organizations. Similarly, expanding trade and financial flows between the region and China present new money laundering opportunities for criminals and associated challenges for Financial Intelligence Unites and other authorities in the region with only limited knowledge of and access to PRC-based banks and companies.
Criminal groups are also exhibiting worrisome innovations in the region in their use of unmanned vehicles, including not only for surveillance, but also for smuggling illicit goods and conducting lethal strikes against each other, and against police and militaries from Mexico to Colombia. The availability of ever more capable commercial drones from China through companies like DJT is compounded by the proliferation of advanced systems and knowledge of how to employ them through the war in the Ukraine, to which Latin American criminal groups have even sent members to fight and receive drone training. Latin American authorities are increasingly suffering losses but are arguably limited by resources and cumbersome bureaucracies in incorporating expensive counter drone systems, and changing doctrine to adapt to a UAV environment.
On the political front, multiple, strategically key countries in the region face close elections and/or crises that could decide the course between pro-US, or alternatively populist or dysfunctional regimes.
In Peru, center-right candidate Keiko Fujimori prevailed over leftist candidate Roberto Sanchez in the June 7th second round of Peru’s Presidential election. The prospect of improved relations with the United States under the Fujimori Administration, security management, and the question of the management of Peru’s commercial relations with China in that context will be critical for the hemisphere in a country where the PRC already has significant presence in the port, mining, telecommunications and other sectors, and where governance is severely challenged by coca growing and illegal mining in the countryside, complimented by extortion and gang violence in the cities.
In Colombia, on June 21st, voters elected right wing candidate Abelardo de la Esprilla over Ivan Cepeda, standard-bearer for radical leftist Gustavo Petro's Historic Pact party. As in Peru, De la Esprilla’ s victory will likely restore Colombia to a more US friendly posture, accompanied by a more aggressive posture against organized crime and security cooperation.
In Brazil, that nations October 4th elections are also a statistical tie between octogenarian leftist incumbent Luis Ignacio “Lula” da Silva, and Flavio Bolsonaro, conservative pro-U.S. son of jailed former president Jair Bolsonaro. The election is particularly critical for the strategic direction of South America, in which Brazil comprises half of the population, half of the landmass (bordering all but two of the continent’s other countries), and a military greater than that of the other South American countries combined. Lula has played a significant role in not only attracting some 40% of all PRC trade and investment going to the region, but also engaging in military and space collaboration with the PRC, plus working with it in multilateral forums from the United Nations system to the BRICS, where both are members. Lula has further emerged as one of the large countries in the region most critical of U.S. policies, leveraging the freedom afforded by its relative independence from the US market.
In Ecuador and Bolivia, although neither are facing Presidential elections in the near-term, both are facing crises which, if not adequately managed, could bring down the government. In Ecuador, President Noboa is arguably losing the faith of the population in his ability, through perpetual states of emergency and alignment with the U.S., to address the reinforcing interaction between drug flows and gangs that have brought devastating violence to the country. Ecuador’s National Electoral Council recently accelerated the timetable for local elections by three months, to November 2026, an event which could open the door for U.S.-hostile elements of the opposition, politically paralyzing Noboa.
In Bolivia, newly elected President Rodrigo Paz appears to be losing ground in controlling the vicious cycle of a lack of dollars and financial liquidity, corruption and strikes that have paralyzed the country. Paz’ own Vice-President Edmundo Lara, and the right-oriented political party of Jorge “Tuto” Quiroga have become some of his greatest opponents, while incriminating behaviors by key ministers are increasingly undermining the population’s faith in him as a clean, different politician, elevating the risk that his U.S.-friendly government may not finish its term.
In Mexico, although elections are still some time away, the nation is at a strategic crossroads with the review of the U.S.-Mexico Cooperation Agreement (USMCA). Mexico’s economic and political future is arguably in the balance, since more than 80% of Mexican exports go to the United States. Recognizing such dependence, leftist Mexican President Claudia Sheinbaum has closely cooperated with, and often deferred to the United states, including receiving deported migrants from third countries, deploying the National Guard to control migrant flows through Mexico, extradited wanted criminals to the United States, and acting more aggressively than her predecessor against narcoterroristas leaders such as “El Mencho,” head of the Jalisco Nuevo Generacion cartel (CJNG). Her government has also imposed taxes of up to 50% on products imported from China and other Asian countries in response to complaints that PRC-based firms use facilities in Mexico as a pass-through to the United States. Despite such cooperation, the U.S. has elected to keep up the pressure, including the April 2026 indictment of sitting Sinaloa governor Ruben Rocha Moya. If the USMCA review breaks down, and/or security cooperation becomes too costly politically for Sheinbaum, the U.S.’ strategically vital neighbor would be economically devastated by the loss of the US market and investment, plus unchained from its incentives to cooperate with the U.S. on security and migration issues, or in restraining itself from opposing U.S. initiatives globally or from embracing China and other U.S. adversaries.
In Venezuela, the decision by the U.S. to prioritize stability over facilitating a direct transition to the legitimately elected government of Edmundo Gonzalez and Maria Corina Machado has avoided a campaign of violence and economic destabilization by the displaced Chavista leadership and entrenched criminals. It has also limited the activities of the PRC and other malign actors in the country, modestly eased repression, and improved economic conditions through the partial lifting of sanctions and creating the basis for new activity in the petroleum, mining and other sectors. Nonetheless, the same group of corrupt actors that bankrupted the country, robbed its riches and the properties of foreign countries remain in place, along with its repressive apparatus such as the SEBIN and the lack of guarantees for the protection of individuals and companies. Venezuelan is unlikely to experience a substantial inflow of needed investment in the near term, nor the return of a significant portion of the nine million citizens previously forced to flee.
In Cuba, the resolution for the moment of the conflict in the Persian Gulf will likely facilitate greater attention by the U.S. to employ expanded sanctions, other pressures, and negotiation to secure a change in the island’s top leaders and major policies. Because the Communist regime is highly entrenched after almost 70 years of control, a substantial increase in U.S. pressure is more likely to create a massive outflow of migrants, rather than regime change. In Cuba, like Venezuela, the most likely outcome may be a deal which affords U.S. companies access to Cuba with certain protections and special privileges, while leaving the regime fundamentally intact with the promise of a future democratic transition.
Latin America, critical to U.S. security and prosperity, continues to weather a storm of reinforcing informational, economic, criminal and political stresses which could reverse its present largely U.S.-compliant orientation and open the door more widely to an embrace of China more rapidly than many imagine. As has occurred repeatedly in the past, the region has a way of making itself heard, when Washington ignores, or does not adequately diagnose and address what ails its neighbors.
