President Obama’s May 2-4 trip to Mexico and Costa Rica is his first regionally-focused visit since attending the Summit of the Americas in Cartagena, Colombia, in April 2012. The trip’s agenda will involve a host of topics, ranging from trade to energy and security.
With US immigration reform looming in Congress as the visit’s backdrop, the trip is an opportunity for the President to push this issue in countries from which most Latino immigrants to the US came from. But, as senior administration officials suggest, the president’s trip is also the beginning of broader efforts at strengthening ties with the Americas. The visit’s agenda is already a step forward as it goes beyond the topics such as the narcotics trade, which has dominated the relationship with these countries historically. But the agenda must also raise issues that are increasingly drawing attention around the globe.
U.S power remains preponderant in the world, but the emergence of new influential economies makes US influence no longer conclusive. If the United States wants to achieve its foreign policy ambitions, it must recognize the need for allies who are willing, capable, compatible, and relevant in today's world. While it appears the president’s trip broadly acknowledges this new reality, the agenda needs to recognize trends that have emerged in the Americas since President Obama took office in January 2009.
In particular, a successful trip would address two new realities that are central to the relationship with countries in Latin America:
Growing Ties between Asia and Latin America. The recent announcement by the Chinese government that growth slowed in the first quarter of 2013 may have alarmed leaders in Latin America more than anywhere else (to be sure, China’s growth is still expected to reach eight percent in 2013). Chinese demand for Latin America’s commodities, from copper in Chile to soybeans in Brazil, helped much of the region minimize the effects of the 2008-09 global recession, and has helped many continue to grow despite sluggish global growth prospects. Even Mexico, which still exports roughly 75 percent of its goods to the United States, is looking to Asia for markets, as Mexican president Enrique Pena Nieto’s recent Asia tour highlights. But, there was a time was when poor economic prospects for the United States were met with dread in Latin America; now, it seems to be met with indifferent shrugs.
Much of the region is moving beyond its focus on China as well, looking to the economies of Southeast Asia, South Korea, and Japan to help buoy domestic growth. Chile has long been at the forefront of this trend, having signed numerous free trade agreements (FTAs) with Asian economies. But others are catching up. Peru is looking to broaden its trade relationship with Asia – witness President Humala’s recent visit – As is Colombia, which recently signed an FTA with South Korea. Chile, Peru, Colombia, and Mexico make up the new “Pacific Alliance,” a regional free trade bloc with an ambition to increase trade ties with the dynamic economies of the Asia-Pacific.
The need for a NAFTA-EU FTA. A potential free trade agreement between the United States and the European Union (EU), also known as the Transatlantic Trade and Investment Partnership (TTIP), has excited policymakers on both sides of the Atlantic, who believe it may help revive growth in the US, EU and among the Latin economies that have FTA’s with the US. The United States should seek this FTA, but would be wise to broaden its scope and include its NAFTA partners in the negotiations, a position the Mexican government has supported. An FTA between the world’s two largest trading blocs would create numerous commercial opportunities between all nations involved.
There are exceptions, but prospects for relations with Latin American countries on the whole have improved. We have continued partnerships in commerce and security, and are on our way to enhancing opportunities that the region can become energy independent. But recent administrations have failed to tie these initiatives into a contemporary framework that explains how the United States views Latin America. The Obama administration may believe it has a strong policy toward the region. However, policy is not what insiders believe it to be, but what outsiders perceive it to be. President Obama’s trip in May represents a chance to create a new narrative…and to make the world over again.