Latin America: Anti-US Rhetoric Does Not Overshadow Trade

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By Luisa Parraguez, Francisco Garcia Gonzalez, Joskua Tadeo*
IDN-InDepth NewsAnalysis

MEXICO CITY (IDN | Yale Global) - The Latin American blogosphere held its breath when Bolivian president Evo Morales’s plane was forced to land in Vienna in July. As European authorities searched for former U.S. National Security Agency contract worker Edward Snowden on board, Twitter accounts of South American presidents exploded with resentment.

The continent denounced the United States for extending its hemispheric supremacy to Europe, sputtered words like “colonialism” and “imperialism,” and claimed that the incident violated the Vienna Convention on Diplomatic Relations. Argentina’s President Cristina Kirchner called the incident “not only humiliating to a sister nation, but also for the whole South American continent.”

Fury continues with reports that the NSA allegedly hacked web accounts of Brazil’s state-owned oil company – described as “industrial espionage” by President Dilma Rousseff – and monitored internet and phone communications of Rousseff and Mexican President Enrique Peña Nieto while he was a candidate. Rousseff postponed a state visit to Washington, pending investigation, and with President Barack Obama waiting in the wings of the UN General Assembly for his turn at the podium, she tore into the United States for its “breach of international law.”

This may be a turning point in U.S. relations with its southern neighbors. While anti-American sentiment on the street, a result of a long history of domination, is real, the bedrock reality is that the U.S. and Latin America are joined at the hip, economically and demographically. Trade, investment and immigration data reveal growing relations and interdependence.

Growing interdependence

Rousseff’s suspending her trip to Washington is only the latest episode in a long history of turbulent relations with external powers. Simón Bolivar, the Liberator of the South, first proposed combatting European colonialism in South America in 1826. During the Cold War, the U.S. policy of containment led to military interventions in Central America and the Caribbean, and supported right-wing dictatorships in the Southern Cone. According to Amnesty International, hundreds of thousands were tortured, exiled or “disappeared” by U.S.-backed military juntas in Chile, Argentina and Guatemala.

The U.S. fear of communism spreading in the region was controlled through the Organization of American States. After the 9/11 attacks in New York and Washington, the Multidimensional Secretariat was established at the OAS to deal with transnational threats such as terrorism and organized crime. Hundreds of thousands more have lost their lives in Colombia, Mexico and Honduras with the rise of organized crime in the region.

Until his death in March 2013, President Hugo Chávez of Venezuela spearheaded a group of eight nations under the Bolivarian Alliance of the Americas, ALBA, in an anti-imperialist movement that carries the banner of 21st century socialism. ALBA, led by Cuba and Venezuela against the Free Trade Area of the Americas headed by the United States, was born to counteract U.S. dominion in the region.

Soon after the NSA revelations began, leftwing governments in South America – Bolivia, Nicaragua and Venezuela – made international headlines by offering asylum to Snowden. The whistleblower’s plight is similar to that of WikiLeaks founder, Julian Assange, who has taken refuge in the Ecuadorian Embassy in London since June 2012. On July 20, less than a month after the beginning of the Snowden affair, Venezuela’s President Nicolás Maduro took the opportunity to end conversations that had begun in June with U.S. Secretary of State John Kerry, stating, “My policy is zero tolerance to gringo aggression against Venezuela.” Talks to replace a U.S. ambassador in Caracas were abandoned yet again.

Trade vs ideology

In Latin America, ALBA countries act as an axis of anti-American sentiment. In February 2013, the Ecuadoran Foreign Minister Ricardo Patiño called the OAS Inter-American Defense Board "useless,” suggesting that it was merely another arm of U.S. influence in the region. A month later, Ecuadoran President Rafael Correa stated in the inaugural address of the 22nd Summit of ALBA that its members “must create a shield against exploitation, a shield against neocolonialism.” ALBA nations have established their own School of Sovereignty and Defense in Bolivia to keep U.S. imperialist intervention at bay. A main security argument is that drug trafficking is a problem for the U.S. and not necessarily a policy issue for South American countries.

It would follow that the strong, constant flows of trade, aid and security cooperation between Latin America and the U.S. would dry up after so much tension. Nevertheless, the U.S. Census Bureau reports that trade remains stable for now, especially for oil producers like Venezuela and Bolivia. Anti-American sentiment in the region seems to be purely rhetorical, having little impact on trade relations with the United States.

Anti-American rhetoric in ALBA countries has not prevented them from listing the U.S. among their main trade partners. As of 2012, the U.S. was the main import source for Venezuela, Nicaragua, Ecuador and Honduras. Particularly striking is that 31.2 percent of Venezuela’s imports and 28 percent of Ecuador’s come from the United States. Adding to this list, the U.S. is Bolivia’s fourth largest source of imports, producing up to 10 percent of its imports, and Argentina’s second source after Brazil.

The United States receives the largest percentage of Latin American exports from Venezuela, Ecuador, Nicaragua and Honduras. In the case of Bolivia, it drops to second place after Brazil. Such significant flows of merchandise and capital will not stop overnight, no matter how many countries forced the Bolivian presidential plane to land for a few hours.

Top trade partner

Demographically and economically, the U.S. is changing in ways that make any standoff with Latin American partners unlikely. According to the Economic Commission for Latin America and the Caribbean’s recent report on foreign investment in the region, the U.S. still accounts for 58.5 percent of foreign investment. At the same time, the 53 million people of Hispanic and Latino origin in the U.S. account for 17 percent of its population, making them the largest ethnic minority in the country. In much the same way, as reported by The New York Times, Latin American migration to the U.S. has reached equilibrium with new arrivals roughly equivalent to the number of people returning home. Americans are also picking countries as diverse as Mexico, Belize, Costa Rica and Nicaragua to retire, while recent trips to Mexico and Chile by the U.S. president and vice-president emphasize education exchanges.

South America expresses its outrage through diplomacy. Consider, after Morales was allowed to return to La Paz, the diplomatic rumble escalated as members of the regional trading institution Mercosur called back their ambassadors in the countries that had denied the Bolivian president use of airspace. Ecuador joined them four days later, at which point Venezuela also officially removed ambassadors in Spain, France, Portugal and Italy. An apology was issued July 25, and ambassadors from Bolivia, Venezuela, and Ecuador were reinstated to their offices in Paris, Rome, Madrid and Lisbon two days later.

Concerns may run more deeply over reports of the United States monitoring communications of presidents and strategic industries. Brazil is the world’s sixth largest economy, and Rousseff may use the embarrassing disclosures to leverage the United States on trade, internet regulation and other priorities.  With the FIFA World Cup and the Olympics coming up, Brazil will most likely use the situation as much-needed political capital at home, instead of attempting any change in relations with the U.S. beyond venting at the UN. Rousseff cannot afford to risk an international snafu amidst growing discontent over her actions concerning domestic policy.

Trade overrides ideology. The bottom line, leftwing leaders like Maduro and Morales need U.S. business in their economies, and the most vehement anti-imperialist talk is overshadowed by economic pragmatism. Ecuador is in an even more critical position, as reliance on the U.S. dollar in its economy means it cannot afford poor relations with the United States. Ideological hot air may grab headlines, but will not trump Latin America’s heavy flows of trade with the world´s most powerful economy.

*Luisa Parraguez is a professor and researcher at the Global Studies Department of Tecnológico de Monterrey’s Mexico City Campus. Francisco Garcia Gonzalez is a Tecnológico de Monterrey graduate and research coordinator at Mexico’s Auditoría Superior de la Federación. Joskua Tadeo is an international relations student and research assistant at Tecnológico de Monterrey’s Mexico City Campus. This article was first published on October 1 with the headline Latin America: Anti-US in Words, Not Deeds on Yale Global. [IDN-InDepthNews – October 2, 2013]

Reprinted with permission of YaleGlobal Online © 2013

Picture: Brazilian President Rousseff  with Bolivian President Morales, united in denouncing the U.S. | Credit: YaleGlobal

2013 IDN-InDepthNews | Analysis That Matters

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