President Barack Obama’s recent claim that he has started “a new chapter of engagement” with Latin America has become a new mantra of his administration, but it may be more rooted in wishful thinking than reality.
That’s the first thing that crossed my mind after interviewing U.S. Secretary of Commerce Penny Pritzker last week, when she stopped in Miami to make a speech in which she wrote in her prepared remarks that “this is an historic moment for the Americas,” and referred to “the Obama administration’s renewed focus on the Americas.”
Pritzker quoted from a recent Obama speech in which the president said that “better relations between the United States and Cuba will create new opportunities for cooperation across our region.” She added that ongoing U.S. talks with 11 Pacific Rim countries — including Japan, Australia, Mexico, Peru and Chile — to sign a Trans-Pacific Partnership (TPP) would create the world’s biggest free trade area, and would greatly benefit Latin America.
She also said that “from Guadalajara to Santiago to Sao Paulo, countries across the region, with some exceptions, are gravitating toward a more pro-market, pro-investment democratic vision for their future.” During her visit, she announced upcoming trips to Colombia, Brazil, and — perhaps as early as next month — Cuba.
When we sat down for an interview, I couldn’t help asking her whether the Obama administration is not overselling this idea of a new era in U.S.-Latin American relations.
First, I can’t recall a U.S. administration in recent history that has failed to proclaim a “new chapter” in U.S.-Latin American ties.
What’s more, the Obama administration is the first in several decades that hasn’t proposed a grand plan for improving U.S. economic ties with the entire region. Obama is currently negotiating the Trans-Pacific Partnership (TPP) and a Trans-Atlantic Trade and Investment Partnership, but has not proposed a similar Trans-American agreement.
Second, the Obama administration has not spent much time nor energies on Latin America over the past six years.
Obama made his first foreign trip as president to Canada, rather than Mexico, in 2009, and in 2012 proclaimed his “pivot Asia” policy vowing to center U.S. foreign policy on Asia. Since then, Obama has spent most of his attention on the Middle East.
U.S. Secretary of State John Kerry has made 65 foreign trips since he started his job two years ago, but only six were to Latin America, according to the State Department’s website.
Third, the U.S. has lost significant market share to China in Latin America over the past decade. China has already become the No. 1 trade partner of Brazil and Chile, and the No. 2 trade partner of Argentina, Peru and Uruguay, according to United Nations data.
“I don’t think this is about winning and losing (market share,)” Pritzker told me, regarding China’s growing presence in Latin America. “It’s about the fact that there is plenty of market for both China and the United States to do business with Latin America.”
“Our engagement with Latin America is broader and deeper than it has ever been,” Pritzker added. She said that 11 of the 20 U.S. free trade agreements across the world are with Latin American countries, and that “our trade to Latin America is growing dramatically.”
Furthermore, the Trans-Pacific Partnership — if it’s approved — will allow Mexico, Chile and Peru to participate in co-manufacturing and supply chains that will benefit from increased U.S.-Asian trade, she said. And because it’s an “open architecture” agreement, other Latin American countries, such as Brazil or Argentina, could join it if they adhere to TPP’s labor, environmental and intellectual property standards, she said.
As for whether Latin America is becoming more democratic, she said that “there is a yearning for engagement with the United States in terms of our policies...in several countries around the hemisphere.”
My opinion: As we said in recent columns, the recent drop in commodity prices is beginning to change the political winds in Latin America after more than a decade of radical populism fueled by oil and grain export bonanzas.
But we’re still far from the “new chapter” in U.S.-Latin American relations proclaimed by the Obama administration. If anything, there is a huge opportunity for the United States to recover lost ground in the region, which Obama may be recognizing now. To turn that opportunity into reality, however, he will need to pay much more attention to the region.