The Foreign Service Journal, June 2011

18 F O R E I G N S E R V I C E J O U R N A L / J U N E 2 0 1 1 In this environment, U.S. and Latin American interests will inevitably clash at times, as they did mightily when Brazil’s President Lula da Silva at- tempted early last year to broker an agreement with Iran over that country’s nuclear ambitions, in opposition to the United States as well as the major pow- ers of the U.N. Security Council. By agreeing to extradite accused drug trafficker WalidMakled to Venezuela rather than to the United States, Colombia demonstrated the priority it attaches to the relationship with its immediate neighbor (as of early May, Makled had yet to be turned over to authorities in Caracas). Aggressive efforts by such actors as China, Russia and Iran to expand their political, economic and military relationships in the hemisphere also pose challenges to U.S. interests. But U.S. power to control, let alone prevent, the diversifica- tion of Latin American foreign relations is limited and, in some cases, nonexistent. Indeed, U.S. influence — not control — will be maxi- mized to the extent the United States recognizes, accepts and works to situate itself within the changed circum- stances in the hemisphere. This is the normal functioning of diplomacy among allies, whose interests will converge some but not all of the time. The current administration’s emphasis on multilateralism and partnership is promising in that it recognizes that the United States not only does not have all the answers but, quite often, has much to learn from Latin American countries themselves. It is no coincidence that our greatest policy fiascos in the hemisphere of the past several years — the dreadful handling of negotiations over a U.S.-Colombia base agree- ment and the decision to break with the rest of the hemi- sphere over how to respond to the 2009 coup in Honduras — occurred precisely because the impulse to “go it alone” prevailed over the more time-consuming processes of con- sultation and consensus-building. Relations with the populist regimes of the Andean re- gion have proved the most vexing for the Obama admin- istration. It has broken the ALBA bloc down into its component parts, recognizing important differences in the political and social dynamics of Ecuador, Bolivia and Venezuela. But the April expulsion of U.S. Ambassador Heather Hodges fromEcuador — an apparent casualty of WikiLeaks — represented a major setback: currently the United States has no ambassador in Venezuela, Ecuador or Bolivia. The State Department has largely continued a policy — initiated in the later years of the Bush administration by then-Assistant Secretary of State Thomas Shannon — of avoiding con- frontation with President Hugo Chá- vez. The logic of that policy has been to deprive Chávez of opportunities to blame mounting domestic troubles on the United States, or to paint the increasingly successful opposition as U.S. puppets. Indeed, in the midst of a burgeoning economic and public security crisis inside Venezuela, the Obama ad- ministration bent over backward to remain neutral about opposition gains in the country’s September 2010 parlia- mentary elections. U.S. liberals and conservatives have criticized the Obama administration for not doing more to oppose Chávez’s attacks on the democratic process in Venezuela. What is less clear, however, is what policy will be effective in achieving U.S. goals, particularly in the realm of dem- ocratic governance. Regional institutions and like-mind- ed regional governments may be better positioned to make a difference in this regard. Patterns of Trade, Aid and Investment Trade partners and trade patterns are rapidly chang- ing throughout the region. The United States remains by far Latin America’s largest trading partner (with trade totaling just over $500 billion last year), although once Mexico is factored out of the equation, the U.S. role is more limited. Asia (primarily but not exclusively China) is Latin America’s second-largest partner, overtaking the European Union. According to a 2010 study by the United Nations Economic Commission for Latin Amer- ica and the Caribbean, China has now surpassed the United States as the top export destination for Brazil and Chile; the same became true for Peru by mid-2010. It is also the second-largest export destination for Argentina, Costa Rica and Cuba. China’s growth has had a profound impact on countries throughout the hemisphere. The impact has been most positive for net exporters of energy, rawmaterials and agri- cultural products, and most negative for those countries whose manufactured exports have been undermined by Chinese competition in such major markets as the United States. All told, Beijing’s trade deficit with Latin America F O C U S China’s growth has had a profound impact on countries throughout the hemisphere.