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Mending Fences in Latin America

Prepared by: CFR.org Staff
March 12, 2007

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President Bush hoped his five-country tour through Latin America would serve as a counterbalance to the influence of Venezuela’s Hugo Chavez. Bush chose to pay no heed (Reuters) to Chavez’s provocations at an Argentina rally, just across the river from where Bush made a stop in Uruguay. Yet widespread protests have marked his trip and marred the kickoff of a “year of engagement” with a region his administration has been accused of neglecting since 9/11.

Despite the protests, the president’s trip showed the region is not united (Economist) behind Chavez either. The Financial Times notes with guarded optimism that Bush’s message of social justice and economic integration represents an “important first step” to develop policy that could serve as an antidote to Chavez. In Montevideo, Bush courted the leftist government, championing (IHT) a U.S.-Uruguay trade and investment agreement signed in February. Bush’s seven-hour stop in Colombia, Washington’s firmest ally in the region, represented the first visit from a U.S. president in twenty-five years to the war-torn country and the chance to discuss the countries’ joint counternarcotics efforts. In Guatemala, Bush emphasized the benefits of a new free-trade agreement and discussed immigration issues with President Oscar Berger, whose country has come to increasingly rely (AP) on remittances from U.S.-based workers. Immigration was also due to be a dominant theme in Bush’s last stopa visit to Mexico’s Yucatan peninsula where he will meet with President Felipe Calderon, the “anti-Chavez” (TIME).

As the protests along the five-country trip show, anti-Americanism runs deep in Latin America, and many are skeptical (LAT) of this new attention from the United States. High oil prices have given Chavez the ability to buy some $1.5 billion of Argentina’s bonds and offer to underwrite coca production in Bolivia, among other ventures. In contrast, Bush’s newly announced aid package and his proposed 2008 foreign aid budget for Latin America are quite modest (NYT). Due to likely congressional restraints, “Bush, particularly on trade issues, probably has very little to concretely offer these countries,” says CFR Fellow Shannon O’Neil in an interview with CFR.org’s Bernard Gwertzman. In its Plan Colombia blog, the Center for International Policy breaks down the 2008 aid proposal, documenting drops in counternarcotics aid to several countries (but not Colombia) and increases in economic aid to Cuba’s opposition.  

In what will likely be seen as the trip’s most notable highlight, Bush and Brazilian President Luiz Ignacio Lula da Silva signed an agreement (MarketWatch) to promote private investment and consumption of biofuels. The Economist heralds this “ ethanol diplomacy,” noting that most Latin American countries could benefit from an ethanol industry because sugarcane grows all over the region.

With expectations for the visit low, much depends on what happens once President Bush returns home. Pending free-trade agreements with Panama, Peru, and Colombia await ratification in Congress, special trade preferences for the Andean countries expire at the end of June, and immigration remains a hot-button political issue. In recent testimony before the House Subcommittee on the Western Hemisphere, Peter Hakim of the Inter-American Dialogue said: “In the coming months, what will be most important is that the United States does no further harm to the already damaged relationship.” As Adam Isacson of the Center for International Policy says in a CFR.org Podcast, the United States could benefit from showing “a little bit of humility” in its dealings with the region.

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