November 29, 2022

Biden to pitch new Latin America economic plan, but it’s short on trade

US President Joe Biden, who will welcome Latin American leaders in Los Angeles, speaks in Rehoboth Beach, Delaware

US President Joe Biden, who will welcome Latin American leaders in Los Angeles, speaks in Rehoboth Beach, Delaware – Copyright AFP Sergei CHUZAVKOV

President Joe Biden will unveil a new proposed U.S. economic partnership with Latin America on Wednesday – but it will not include new trade agreements.

In a summit already undermined by discord over the guest list, Biden has the difficult task of trying to gain back lost ground – seeing as China has bullied its way into trade deals in large swathes of Latin America.

According to a senior administration official, Biden is offering our southern neighbors an alternative that calls for increased U.S. engagement, including stepped-up investment, strengthening supply lines, and building on existing trade deals.

However, Biden’s “Americas Partnership for Economic Prosperity,” appears to be a “work in progress.” It stops short of offering tariff relief and, according to the U.S. official, will initially focus on “like-minded partners” that already have U.S. trade accords.

Politico gets the sense that in the initiative the administration is prioritizing domestic issues like immigration over meaningful economic engagement.

Biden plans to outline his plan in a speech later on Wednesday to formally open the summit, which was originally conceived as a platform to showcase U.S. leadership in reviving Latin American economies and tackling migratory pressures.

At the same time, Biden wants to address climate change, and immigration challenges – while trying to lessen the growing economic and political influence of its main geopolitical rival, China.

But it is difficult to say whether Biden’s approach will satisfy the desire of Latin American countries for more trade access with the U.S.

“I really worry America has sort of walked away from our engagement in Central and Latin America, and I think it’s going to take a deliberate, concerted effort to reengage,” said Rep. Kevin Brady (R-Texas), the House Ways and Means Committee’s ranking member and a vocal supporter of free trade.

“I don’t see that happening at the Americas summit, principally because the whole world knows the president’s not interested in enforceable trade agreements that can help boost investment in two-way trade,” he continued.

The trade gap with the United States in the rest of Latin America, which first opened up under former U.S. President Donald Trump in 2018, has grown since Biden took office in January last year, despite a pledge to restore Washington’s role as a global leader and to refocus attention on Latin America.

And it is going to be very hard to beat China’s trade deals in the region, after China – a major buyer of grains and metals, simply offered more to the region in terms of trade and investment.