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How will Joe Biden, who leads polls ahead of the November U.S. presidential elections, handle U.S. sanctions in Latin America? (Photo: Joe Biden's Twitter)
Wednesday, July 29, 2020

Latin America: Will Biden Lift Sanctions?

Will Joe Biden lift or keep US sanctions on Cuba, Guyana, Nicaragua and Venezuela?

Inter-American Dialogue

Since taking office, U.S. President Donald Trump’s administration has toughened sanctions against some Latin American governments in an effort to exert pressure on those countries’ leaders. The Trump administration recently sanctioned officials of President David Granger’s government in Guyana following the country’s disputed election. U.S. sanctions have also targeted Venezuela’s oil industry, the assets of top Nicaraguan government and military officials, and some remittances to Cuba. If Trump wins re-election in November, how could sanctions involving Latin American countries expand or otherwise change in his second term? If Joe Biden is elected president, to what extent would sanctions involving the region change? In the area of sanctions policy, what is most at stake for businesses in the U.S. presidential election?

Seth Stodder, partner at Holland & Knight: A Biden presidency will mark a major shift in U.S. foreign policy toward Latin America, but I would not expect much change regarding Venezuela, Guyana and Nicaragua. On Venezuela, it is possible we may see an even tougher approach, given Vice President Biden’s criticism of Trump for saying he would be willing to meet with Venezuelan President Maduro. Biden has not made any specific comments on Guyana, but he is likely to maintain the visa sanctions imposed on Guyanese officials in response to President Granger’s refusal to transfer power after the recent election. Biden has not commented specifically on Nicaragua, but given the Ortega regime’s corruption, human rights abuses and open support for Maduro, a lifting of sanctions seems unlikely—at least until after Nicaragua’s 2021 election. Cuba policy, however, is one area where a Biden victory would likely have a major impact, as Vice President Biden has advocated resuming President Obama’s normalization of U.S.-Cuba relations and lifting trade and travel restrictions—in part reversed by President Trump. That said, Biden has also been very critical of recent human rights abuses by the Cuban regime, and he was also very critical of Senator Bernie Sanders’ praise of certain Cuban policies during the Democratic primary campaign. So, I would not expect an immediate resumption of normalization efforts by a President Biden, as it will likely depend on improvements in the Cuban government’s human rights record. But as trade and travel restrictions are again lifted, this may provide businesses with significant opportunities in Cuba.

Angela Mariana Freyre, former general counsel of the U.S. Export-Import Bank and former special advisor for Cuba policy at the National Security Council: One of the most unfortunate aspects of the Trump administration is its abandonment of diplomacy and engagement in favor of trade wars and sanctions, not only in Latin America, but throughout the world. Although sanctions have different purposes (the recent sanctions in Guyana were intended to pressure the Granger government to respect the internationally confirmed election results), most sanctions seek to achieve regime change by denying resources to the target government and creating difficult living conditions for the people of the target country (the sanctions against Cuba, Nicaragua and Venezuela, which target, among other things, oil shipments and remittances). In addition, the purpose of these latter sanctions is also to appeal to the conservative voters of the Cuban-, Nicaraguan- and Venezuelan-American communities in south Florida ahead of the 2020 U.S. presidential election. The administration’s ‘maximum pressure’ strategy will no doubt lead to further sanctions ahead of elections and thereafter. Although many sanctions levied against individuals in Latin American have little or no effect on U.S. companies doing business in Latin America, the aggressiveness of the current sanctions regime casts a chilling effect on the investment environment and particularly on financial institutions, which are critical to U.S. companies doing business in the region. Particularly, the secondary sanctions create an in terrorem effect on trade and investment. I believe that a Biden administration would return to promoting U.S. interests and values in Latin America through diplomacy and engagement and that a reversal of the current sanctions would be a very important first step in repairing the damage inflicted by such sanctions as well as our relations throughout Latin America. We know that the only sanctions that actually work are those that are principled and garner the support of others through diplomacy and engagement.

Jim Kolbe, senior transatlantic fellow at the German Marshall Fund of the United States and former member of U.S. House of Representatives (R-Ariz.): The effectiveness of sanctions rests on two requirements. The first is an asymmetrical balance of power between the country initiating the sanctions and the country being sanctioned. The second requirement is the willingness of other countries to fall in line and enforce the sanctions as they are levied. Sanctions were effective in changing South Africa’s government four decades ago. They were overwhelming in their force and almost universally accepted and enforced by the world community. However, sanctions against North Korea’s ‘hermit kingdom’ have been ineffectual, both because the isolation of the country makes them nearly immune to outside pressure and because China has been unwilling to enforce sanctions. In Latin America, sanctions almost universally adhered to were instrumental in bringing an end to the Pinochet regime in 1990. Conversely, a half century of sanctions against Cuba have proven ineffective in bringing about any meaningful change in their political system. A cursory review of sanctions imposed by the United States will show that they have been widely used by presidents and Congresses of both political parties. Once sanctions are in place, a change of administrations usually does not result in altering their status. They take on a life of their own and are not likely to be dismantled until there is a fundamental shift in the political relationship. Regardless of whether January 2021 brings either a new Biden administration to Washington or a continuance of the Trump presidency, there is not likely to be any major change in sanctions already in place against Cuba, Nicaragua or Venezuela.

Julia Buxton, professor of comparative politics at the School of Public Policy of Central European University in Budapest:  Sanctions are rarely effective. Where they have instrumentalized change, this has been predicated on credible evidence of responsibility for the sanctioned action, initiation and oversight by legitimate actors and interlocutors, and broad support from the international or local community. The use of sanctions by the Trump administration has been excessive and rarely met these requirements. They have been a tool of first rather than last resort, and this has degraded their effectiveness. Sanctions have been a mechanism for bypassing more complex, professional processes of diplomatic engagement and persuasion. In their volume, they speak of a petulant and disorganized approach to foreign affairs, and the primacy of ‘transactionalism’—engagement for the benefit of certain U.S. corporate, private and political interests—not the promotion of a normative, universal good. Wide ranging sanctions, as in Venezuela, have been imposed without assessment of social impact, they have increased the costs of reconstruction, exacerbated polarization and encouraged closer ties to Russia and China. Where the focus of sanctions in the region has been on individuals, they have had negligible effect and not addressed deeper structural problems. The persistence of such an ad hoc and unilateral approach under a re-elected Trump presidency will have diminishing returns. The costs to U.S. business will be confusion in the operating environment (Citgo is a paradigm of sanctions incoherence) and elevated anti-Americanism. Rebuilding the State Department and U.S. diplomatic capacity has the potential to redress the negative and counterproductive impacts of Trump’s sanctions promiscuity. It should be a priority for Biden.

Republished with permission from the Inter-American Dialogue's daily Latin America Advisor


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