Foreign and Defense Policy, Latin America

Latin America is crucial to US competitiveness

Image Credit: Rennett Stowe (Flickr) (CC BY 2.0)

Image Credit: Rennett Stowe (Flickr) (CC BY 2.0)

A stable and prosperous Americas is indispensable to US economic success and security. However, the US economic and fiscal crises and preoccupation with two controversial wars distracted policy makers in Washington and undermined US leadership in the region. Although access to the US market, investment, technology, and other economic benefits is valued in most countries in the region, the United States is not the only partner to choose from– with China’s influence growing.

The United States must recover its own credibility by making bold decisions to restore fiscal responsibility, aggressive trade promotion, energy interdependence, and economic growth.

The security challenges in the Americas are very real and growing more complicated every day. Illegal narcotics trafficking, transnational organized crime, and radical populism fueled by Venezuela’s petrodollars and allied with dangerous extra-regional forces pose a daunting set of challenges.  Alongside a positive economic engagement, assessing and addressing threats is an indispensable obligation to US security and regional leadership.

Expanding Regional Economic Cooperation and Trade Integration

An aggressive trade promotion and foreign investment strategy in today’s hypercompetitive globalized economy are imperatives.

Mexico, Chile, Peru, Brazil, and Colombia have been at the forefront in modernizing their economies, liberalizing trade, opening their economies to investment, and becoming more competitive overall. Since 2003, an estimated 73 million Latin Americans have risen out of poverty. Moreover, between then and 2010, the average Latin American income increased by more than 30 percent, meaning that today nearly one-third of the region’s one-billion population is considered middle class. And in just the next five years, regional economies are projected to expand by one-third. That macroeconomic stability generates even greater opportunities for US business.

Already the Western Hemisphere supplies one-quarter of the world’s crude oil, one-third of the world’s natural gas, nearly one-fourth of its coal, and more than a third of global electricity, while offering tremendous potential for the development of renewable energy technologies. Three of the United States’ top four foreign sources of energy are in the Americas.

The US administration must recognize this reality and act to take full advantage of the opportunities.

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