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Trump and Latin America: Winners & Losers
A roundup of what key experts say about the impact on Latin America.
BY LATINVEX STAFF
What will a second Trump Administration mean for Latin America? Which countries will benefit? Which will lose? Latinvex compiled public statements from ten leading experts.
MEXICO
Andrés Rozental, president of Rozental & Asociados and former deputy foreign minister of Mexico, in the Inter-American Dialogue’s daily Latin America Advisor: Donald Trump’s election victory is bad news for most of Latin America, but especially for Mexico. Given Trump’s campaign emphasis on trade and immigration issues involving the region, as well as his apparent control of both houses of Congress and of the Supreme Court, the way is paved for him to implement many if not all of the threats he proffered during the last few months. Although experience has shown that Trump often uses rhetoric and intimidations as a negotiating tactic, rather than as policies to be implemented, this time around, his resounding win and knowing some of the individuals he is likely to name to his cabinet all portend a complicated and aggressive set of bilateral relationships between the United States and Latin America. Drugs, undocumented immigration flows, trade disputes, border security and a general disdain for many of the region’s governments will probably result in unhealthy interactions with most of the current left-leaning leaders in Latin America. If one believes in Trump’s threats to slap high tariffs on all imports into the United States from abroad and his promise to massively deport undocumented immigrants, together with measures to close the border with Mexico and resume building the wall that was never finished, Claudia Sheinbaum in particular will be faced with a hostile neighbor with whom she will have to deal for the next four years. She has neither the experience nor the bravado of her immediate predecessor, and that doesn’t bode well for Mexico-U.S. ties going forward.
Jorge Mariscal, experienced Chief Investment Officer and expert in emerging financial markets, in Global Americans: Among the countries in the Americas, Mexico stands to face the biggest challenges from a second Trump presidency. Protectionism in trade and migration were two central pillars of Trump’s successful presidential campaign. It remains to be seen how much of the campaign trail rhetoric translates into actual policy. But even if just a fraction of Trump’s plans is implemented, one can expect a meaningful negative impact on nearshoring investment (especially by Chinese companies seeking to export to the U.S.), exports, and remittances. There could also be humanitarian concerns derived from mass deportations. Trump could press Mexico to effectively become a “retention wall” for illegal migrants from Mexico and Central America, and to get the Mexican government to up its game to fight organized crime. Ultimately, Trump’s protectionism injects uncertainty to the scheduled review and ratification of NAFTA in 2026. The external risks from the Trump administration compound domestic uncertainty caused by recent reforms in Mexico that erase institutional checks and balances, grant unlimited power to the president and the ruling party, and potentially undermine the rule of law. All this translates into higher country risk. Mexico’s economy, already slowing palpably in the second half of this year could teeter into recession in 2025.
María Fernanda Bozmoski, deputy director of operations and finance at the Atlantic Council’s Adrienne Arsht Latin America Center: A second Trump administration with JD Vance as vice president (both Trump and Vance have floated sending the US military into Mexico) is likely to prioritize harsh immigration and trade policies in its relations with Mexico. The two issues would be explicitly tied. Building upon his previous term’s initiatives, such as the “Remain in Mexico” policy and the construction of the border wall, Trump may seek to implement more aggressive measures to curb illegal immigration and may take advantage of the upcoming US-Mexico-Canada Agreement (USMCA) review period to demand more of Mexico in terms of immigration enforcement. Though he has talked about mass deportations and the use of military forces to enforce border security, it is unclear how he would operationalize these policies.
On trade, Trump’s “America First” approach may lead to a dramatic renegotiation of the USMCA, and he may strain ties with Mexico by imposing higher tariffs on Mexican imports in the name of protecting US industries. For the incoming Trump-Vance administration, the relationship with Mexico will be transactional and zero-sum.
BRAZIL
Scott MacDonald, Chief Economist at Smith’s Research & Gradings, in Global Americans: Donald Trump’s victory was greeted with trepidation in Brazil. Although the two countries are close trade partners and the North American country is the South American country’s largest foreign investor (reaching a record $29.4 billion in 2023), President Luiz Inacio Lula da Silva’s center-left government and the incoming rightwing Trump administration are likely to have their differences. Brazil under Lula has sought to maintain a neutral foreign policy based on multilateralism, de-dollarization in international trade, and a willingness to engage with China and Russia through the BRICS organization. Brazil has also diverged from U.S. policy on Gaza and the Russo-Ukrainian War. Venezuela has provided another vexing issue, though Lula’s veto of Venezuela’s membership bid at the recent BRICS summit has drawn Brasilia and Washington a little closer.
Brazilian-U.S. relations could be complicated by personal differences between Lula and Trump. Lula had a positive relationship with President Biden, sharing opinions on human rights, climate change and energy transition. His relationship with Trump is likely to be more challenging, considering the U.S. leader’s views on China’s role in Latin America, penchant for protectionism and lack of concern about climate change, not to mention his cordial relationship with Lula’s hard-right rival, former president Jair Bolsonaro. This portends a more complicated yet still cordial relationship.
ARGENTINA
Jorge Damian Liotti, on Argentina, Editor-in-Chief of the Politics Section at La Nación, in Global Americans: The triumph of Donald Trump is particularly significant for Argentina’s president Javier Milei for several reasons. First, because Milei has shown a clear preference for him, based on the idea that both share similar style of leadership: outsiders, anti establishment, disruptives, very critical of traditional media and journalism. They also share ideology and values, such as rejection of any version of socialism and of the woke agenda (gender, climate change, global health). Second, because Milei thinks that Trump could be supportive of Argentina in the IMF (the country is the heaviest global debtor of the organization). Trump was very relevant in 2018 to force the IMF board to give a US$40.000 million loan to Argentina. Third, because in a Latin American context defined by left-wing leaders (Lula, Boric, Petro, Maduro), Milei envisages he can become the best regional ally of Trump.
On the other hand, there are some topics that could be thorny for the relationship. First, Trump’s promise to implement protectionist measures collides with Milei´s open markets stance, and can also affect some Argentine exports. Second, Milei wholeheartedly endorses Zelensky pleas for western help against Russia, while Trump seems more prone to finish the war with some territorial concessions. Third, Trump could be more assertive than Biden in his demands for Argentina breaking apart from China, the main buyer of its grains and soya.
CENTRAL AMERICA
Arturo McFields, Nicaragua’s former ambassador to the OAS, in The Hill: Salvadoran President Nayib Bukele is one of the big winners with the return of President Trump. He has a first-class relationship with the Republican Party, the conservative press and the presidential family. More investment and trade are expected for the safest country in Central America.
Costa Rica and Panama would be natural Trump partners, with no problem working with the new U.S. president.
Guatemala and Honduras were … big losers last Tuesday. Honduras is a rising narco-dictatorship, and Guatemala lacks an ideological affinity for Trump.
CHILE
Patricio Navia, Clinical Professor at NYU and expert in Latin American democratization and electoral systems, in Global Americans: The return of Trump to the White House will force Chile to prepare for turbulent times. As Trump might engage in an important trade war with China, Chile will be in the uncomfortable position of seeing its most important ally among world powers fight Chile’s most important trade partner. If we get lucky, Chile won’t be forced to take sides. The U.S. has a free trade agreement with Chile and Chileans enjoy visa waiver benefits to enter the U.S. Many Chileans invest in the U.S. and many members of Chile’s elite attend college and graduate schools in the US. But China is our most important trade partner. A full blown trade war between China and the U.S. would be the worst possible scenario for Chile.
Given that Argentine President Milei has strong connections with Trump, Chile will need to work hard not to lose ground among the U.S.’s allies in the region. Fortunately, Chile is a more reliable historic trade and political partner than Argentina. But given President Boric’s limited interests in promoting foreign investments, his government’s policy priorities that have adversely affected U.S. companies (including the pensions reform) and his strong defense of Palestine, it does not seem that Trump and Boric will become close friends. It is in Chile’s best interest to remain on good terms with the U.S., but there are significant downside risks in the horizon now that Trump will return to power in 2025, at least until President Boric leaves office in early 2026.
COLOMBIA
Mauricio Cárdenas, former Colombian Minister of Finance and Public Credit and former Minister of Mines and Energy, in Americas Quarterly: Trump is likely to pressure Colombia over an increase in cocaine production and Petro’s Total Peace strategy, leading to increased tension in the relationship between Washington and Bogotá, a possible reduction in military aid and even the threat of economic sanctions.
Sergio Guzman, Director and Co-Founder, Colombia Risk Analysis, in Global Americans: Trump’s victory marks the potential end to the bipartisan U.S.-Colombia relationship. We expect the personal relationship between Trump and Petro to be cathartic, turbulent and focused on trading social media barbs. We foresee three main impact areas: drug trafficking, peace and security; migration; and the economy. Trump’s stance on Colombia’s coca cultivation will likely strain ties, as President Gustavo Petro’s administration resists forced eradication policies, increasing tensions. Trump is unlikely to support Colombia’s peace negotiations with armed groups, which could lead to reduced U.S. aid for combating these groups. On migration, Trump’s “America First” policy could trigger mass deportations, forcing many migrants, including Colombians, back to Latin America, creating an unforeseen migrant wave to Colombia and potentially triggering conflict between Petro and Trump. Economically, Trump’s tariffs will likely disrupt global value chains, affecting inflation forecasts and trade with partners like Colombia. Notably, the environment will not be an area of focus in the relationship as Trump and Petro hold opposing views on environmental policy, climate change, and energy transition.
VENEZUELA
Geoff Ramsey, senior fellow at the Atlantic Council’s Adrienne Arsht Latin America Center: Exactly how Trump will approach Venezuela remains to be seen. On the one hand, in his first administration he led a maximum-pressure campaign on Venezuelan ruler Nicolás Maduro, which ramped up financial, oil, and individual sanctions against the government and key regime figures. On the other hand, in recent months he has notably refrained from publicly promising a return to this approach. On the campaign trail, his remarks on Venezuela largely focused on the flow of migrants and refugees from the country, with Trump claiming that the country’s crime rate has plummeted because so many Venezuelan “criminals” have come to the United States. This, combined with the fact that former Trump officials have said that he became frustrated with the Venezuelan opposition and with the failure of the pressure campaign to achieve results, could point to a second Trump administration adopting a more transactional approach to Caracas. The Trump administration, after all, on multiple occasions engaged in backchannel talks with Maduro, and Trump himself expressed interest in meeting Maduro face to face back in 2020. Ultimately, while it is likely that Trump will adopt more confrontational rhetoric on Venezuela, he may see more value in containing the outward flow of migration and securing a US and Western footprint in Venezuela’s oil sector than in reverting to a maximum-pressure approach.
Comments compiled from Americas Quarterly, Atlantic Council’s Adrienne Arsht Latin America Center, Global Americans, Inter-American Dialogue’s Latin America Advisor, The Hill.
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