Among so many differences that the policy towards Latin America of the president of the United States, Joe Biden, has with that of his predecessor Donald Trump, there is a similarity: migration is a priority.
The US objective continues to be to reduce the irregular flow of people entering the country; Trump tried with threats and severe measures, Biden promises to address the causes of emigration in Central America, such as poverty, violence or corruption.
But some analysts note that Washington still lacks a broader strategy toward its southern neighborhood, including economic, commercial or even health initiatives in the face of the covid pandemic – 19.
In this context, Richard Feinberg, a professor of international economic policy at the University of California San Diego, launches a bold idea: that the US includes the countries of the Caribbean basin in its domestic economic plan.
This would mean adding from Mexico to Central America and Colombia to Biden’s initiatives to improve infrastructure, digitization, teaching and job training in the US, explains in an interview Feinberg, who led the asun inter-American parties in the White House National Security Council during the Bill Clinton administration (1200 – 1996).
The following is a synthesis of the talk, translated and edited for clarity , with this expert who also worked in the US State and Treasury departments and recently published his proposal at the Wilson Center in Washington:
Your proposal probably it reflects the idea that something must change in the way the US views Latin America…
The Biden government is just beginning. The problem is that the region is not doing well enough.
I am not one of those who says that all the problems in Latin America are due to the failure of US foreign policy. Countries must take responsibility for their own stories.
Now, the United States has an interest, like any great power, in countries of its near exterior.
Western Europe takes care of Eastern Europe, Southeast Asian China, in the sense that they see that their destinies are inevitably intertwined by geopolitics. This is in the interest of the great powers to promote economic prosperity and political stability.
What I recommend is a series of policies that promote work with Central American and Caribbean countries, both Of interest to the US and the region: more economic growth distributed more equitably and stronger, more vibrant and democratic institutions.
Isn’t the US doing that? USA ?
Biden’s government barely takes 100 days, it’s very soon.
What he has suggested is a more or less traditional foreign assistance program to the countries of the Northern Triangle (Guatemala, Honduras and El Salvador) of about $ 4, 000 millions of dollars in four years. Of course, they have to define what they are going to ask for and go through Congress.
The Biden government agrees with many academic analyzes that say that the main problem in the Triangle The North and other developing countries have to do with the quality of government: it does not represent the population well, the institutions are weak, they cannot implement policies and a large amount of money disappears into the pockets of corrupt officials and politicians.
The Biden administration wants to focus more on those issues.
I might agree, but I don’t think that’s enough given the depth of the issues that we see in some of the countries in the region.
So I suggest a completely different approach.
The Biden administration is launching a whole series of extremely ambitious initiatives in the economy and domestic society.
But the analysis made by the Biden government is very similar to that which can be done in the Caribbean basin: there are problems of infrastructure, digitization, job training, health, education and also urban violence.
These are problems seen both in the US and in the countries of the Caribbean basin.
And what do you propose?
What I propose is that the government take many of the programs that are being designed primarily for the domestic economy and spread throughout the Caribbean basin.
For example, the government has already said that many programs that have to do with climate change and Clean energies should also be applied to the Caribbean basin, to try to keep countries away from hydrocarbons, invest more in clean energy sources.
That is also true for digitization. Central America and the Caribbean have advanced dramatically in terms of internet access, but there is often a long way to go in smaller towns in rural areas, as in the US
From similarly in infrastructure: roads, ports, airports … As we are doing in the US, we could help finance projects in Central America and the Caribbean.
Ultimately, investment and growth are needed to support good social programs and sector spending
The government has advocated for innovation centers or technology centers that it would help finance in the US And this is related to the issue of supply chains: US corporations they have become very global in their supply policies.
A lot s of US companies have located their production facilities in Asia, particularly China. We found over the years that this created certain vulnerabilities.
The Biden administration says it would like to see some of those supply chains moved from Asia to the US But mostly Of the cases that would not happen because we are not competitive at the cost level in certain production lines.
What I suggest is that some of these centers may also be located in Central America and the Caribbean, and that the US can help finance the infrastructure, working with multilateral banks such as the Inter-American Development Bank and the World Bank, as well as private sector investors, both international and domestic, to put these centers into operation.
That would create a lot more jobs in the region, to intertwine its economy with that of the US.
¿A Which countries do you mean exactly when you talk about the Caribbean basin?
I mean Central America, not just the northern zone —which is what the Biden government focuses on due to immigration— but would include Nicaragua, Costa Rica and Panama. And then the Caribbean islands, Colombia, Venezuela, which of course is a special case but is part of the basin, and Mexico.
How do you suggest financing this expansion of domestic programs to the region when there are already questions about how the Biden government can finance them at the national level?
If you include the programs in an aid budget abroad, it is very difficult to get Congress to approve them.
That is why what I suggest is to include the programs in these large domestic initiatives. Biden has advocated for $ 2.7 billion in the Build Back Better initiative, as well known as investment in jobs.
How will they be paid? There are basically two sources: tax hikes, which is what Biden has proposed, and deficit financing. As interest rates are very low, the government can issue bonds with modest interest rates in the future.
USA. It already has a free trade agreement with Mexico and another with Central America plus the Dominican Republic that liberalized trade and services. But that did not help reduce the flow of migration, violence or corruption in the region. Why would an initiative like the one you propose have a better result?
These various business initiatives have created many jobs in the region.
On the US-Mexico border there are something like 2 million Mexicans working in maquilas or Supply chains linked mostly to US manufacturing companies.
Trade agreements cannot solve all problems. The fact that there are problems of corruption and inequality in Mexico is not the fault of NAFTA, which did what it is supposed to do: increase commercial investment flows and create more jobs in Mexico.
Similarly in Central America. There are some 500, 000 jobs in the region that may support 2.5 million Central Americans alone in supply chains. That is a contribution.
You cite the example of the maquiladoras and propose the creation of different centers in the region to produce for the US market. What would be the difference between these centers and the factories created by free trade agreements that are now considered symbols of poor labor standards?
Who considers them? If you were a young woman in Central America with six to nine years of education, you would be happy to get a job in one of those factories. I’m telling you this because I’ve talked to a lot of people there.
Now, could conditions improve? Yes, of course. What I am advocating is for the US to sign social agreements with host countries that include protections for workers’ rights, the environment, and community rights.
And there would be extensive oversight : national and international auditors of compliance with the agreements.
Another of the great problems of the region is corruption. How would you prevent any investment from ending up in the pockets of officials?
As a requirement for these agreements, supervision mechanisms could be created, including the US government. ., with agencies that would have their offices in the field, so that there is total transparency to limit corruption.
I am not going to tell you that they are going to eliminate it overnight . But you can put in place mechanisms that provide some guarantees, and then, over time, try to strengthen national institutions and staff training.
You have warned that the US employment plan presented by Biden for domestic politics could harm the Central American economies. Why?
That is if you are serious about wanting American companies that source their supply chains from factories abroad to return to the US. .UU.
There are around 500. 000 jobs Only in Central America and, if each worker supports a family of five, there are 2.5 million citizens who would potentially lose their jobs and family income.
So, if I carry Biden’s policies to the extreme, bringing all production facilities back to the US sounds good, it seems to be what some Americans want to hear… if you really did it, you would create a massive dislocation in Central America. The result can be imagined: tremendous pressure on governments, instability and labor migration.
¿ Is Is your proposal for Latin America also a way to counteract the growing influence of China in the region, in terms of trade, loans and infrastructure supply?
Trump administration officials toured Latin America saying: “Beware of China, Chinese investment is predatory, they just want to accumulate large debts, gain internal influence and destroy their economies!”
But in Latin America people did not understand what they were talking about. Countries need investment in infrastructure, capital flows, they want more trade. In general, the opportunity of the Chinese economy in the region was considered positive, not a threat.
The amount of Chinese activity in Latin America varies from country to country, but it is not due to exaggerate. By comparison, the US presence in all areas still far exceeds the Chinese presence in most countries.
Now, if the US. The US wants to maintain its advantage, I think that instead of speaking ill of the Chinese, we should put more on the table ourselves, in a more positive and constructive way.
USA. It is an asymmetric power and any economic plan it launches for the region, even with the best of intentions, could run the risk of being more favorable to its interests than the poorer countries and be seen as a neocolonial effort. Isn’t it a huge challenge?
What I propose is that social pacts be signed between the governments of the region and the United States. that the host countries would be at the table, as well as the different regional entities, such as Caricom (Caribbean Community) designing these programs.
The programs I am suggesting will benefit the average working class person in Central America and the Caribbean. By guaranteeing worker rights and environmental sustainability and trying to produce better governance, many of these programs would weaken the powers of the old elites, the old upper classes, who are accused of exploiting the common man and woman of the region.
Therefore, the upper classes could say that this is neocolonialism as an excuse to try to maintain their own power internally. But it would only be a smokescreen.
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