Latin America and the Caribbean: A Destabilized Region Stifled by Political Chaos, Mounting Debt and Aggressive US Interference

The electoral victories of Gustavo Petro and Inacio Lula da Silva this year in Colombia and Brazil have raised hopes for a new strong impulse towards the full emancipation of Latin America and the Caribbean. The recent reopening of relations between Colombia and the Bolivarian Republic of Venezuela has reinforced that optimism, along with the likely early abandonment of failed impostor Juan Guaidó by his American owners, who in practice already accept the legitimacy of the government of President Nicolás Maduro. Likewise, Lula da Silva’s new government in Brazil is expected to adopt policies that more actively promote regional economic development and integration.

But generally in Latin America and the Caribbean, the reactionary imperialist influence of the US corporate elites and their government continues to stifle the region’s free development, both through aggressive direct interference and too via sinister indirect economic control. In relation to this neocolonial economic power of the United States, the United Nations Conference on Trade and Development (UNCTAD) has explored in its Trade and Development Report this year the implications of the end of the low interest rates of Western central banks that lasted more than a decade until the end of 2021.

During that period, the governments of many developing countries took on relatively high levels of debt. Some governments took on even more debt between 2020 and 2022, mainly so as to better manage the difficulties caused by the international measures implemented against COVID-19 and also to buy vaccines. Now, Western central banks are raising their interest rates, supposedly to control inflation. However, the likely success of such measures is in question given that the main causes of inflation at the international level this year have not been an excess of demand or wage increases, but limitations in the global supply of goods.

Also contributing to higher inflation has been the increase in the profit margins of large companies both nationally and internationally, inflating prices by as much as 40% or even 50%. These problems in the global economy have been further complicated by the Russian military special operation in Ukraine and the counterproductive Western coercive measures against the Russian Federation, which have seriously affected the very Western economies that applied them. In general, countries with relatively high debt levels are going to have problems due both to higher interest payments and to capital flight, especially to the financial markets of the United States.

By the end of October this year the value of the US dollar had gained 22% against the Japanese yen and 13% against the Euro. The increase in the value of the dollar on international markets further complicates the situation of the national economies of developing countries. This reality is another expression of how Western domination of the world economy and its financial order drastically limit the possibilities of majority world countries to develop their economies successfully. Despite advances towards a multipolar world with more diverse commercial and financial options, thanks mainly to China, the nations of regions such as Africa or Latin America and the Caribbean remain subject to the neocolonial domination of the United States and its allies.

This causes a dilemma for the social democrat leaders of Latin America and the Caribbean. It may be that they favor progressive policies of regional integration that allow economic activity on a larger scale and greater commercial exchange within the region. But they always feel that they have to be attentive to what the US and European authorities and the corporate owners of those governments want. This reality is reflected to a greater or lesser degree in the behavior of leaders such as Lula da Silva, Andres Manuel López Obrador, Alberto Fernández, Gustavo Petro and Gabriel Boric, for example in the reckless, incoherent and untimely invitation by Gustavo Petro to the US Southern Command and even NATO to intervene to protect the Amazon.

Within this regional context, multiple contradictions at the national level in countries such as Argentina and Brazil also tend to affect the external policies of their governments. Argentina has applied to join the BRICS group while remaining subject to the neoliberal conditions accompanying the debt agreement with the US controlled International Monetary Fund negotiated by the corrupt previous government of Mauricio Macri. At the same time that relations of Latin American and Caribbean countries with China have advanced very positively, those countries’ governments continue to participate in the Organization of American States despite its nature and role as a neocolonial tool of the United States. Only Cuba, Nicaragua and Venezuela have rejected it.

The regional policy of the United States consists very clearly of using multiple types of interference to weaken the capacity of the region’s nations to defend their national sovereignty. The US goal is to provoke crisis and polarization across Latin America and the Caribbean so as to facilitate its economic, cultural, political and even juridical control and influence. This constant multifaceted interference by the United States, whether directly through its military, diplomats, corporations and bankers or by means of its various local allies, has caused insecurity, violence and political instability in many countries of the region.

In Ecuador and Haiti, there is acute violence and a collapse of the authority of those countries’ governments. In Peru, the government of Pedro Castillo has been paralyzed by an institutional and legal war waged relentlessy by the political opposition. Brazil is also highly polarized. Lula da Silva won the recent election with a very small margin of votes, supported by a coalition with many internal differences. Upon assuming office, he will have to face an opposition-dominated legislature in a country where most of its component states will also be governed by the opposition.

Argentina will have national elections next year in an atmosphere of great uncertainty favoring the right wing, which achieved an important advance at the end of 2021 by winning control of the senate in that year’s legislative elections. In Bolivia, the violent racist opposition in Santa Cruz continues to promote conditions for a new coup attempt against the government of Luis Arce. In Chile, Gabriel Boric has been unable to formulate a national project capable of confronting and overcoming the endless class war of the country’s right wing, a political failure expressed in the defeat in the recent referendum of the proposal for a new constitution. With different nuances, these same patterns of polarization, instability and insecurity characterize Mexico, Guatemala, Honduras and El Salvador.

Cuba continues to stand as an indomitable model of the defense of national dignity, but its population experiences extreme hardship as a result of the ruthless, genocidal US blockade. The bolivarian government of President Nicolás Maduro and the Venezuelan people have overcome the worst effects of the innumerable illegal coercive measures, sabotage and assassination attempts by the United States, the European Union and the Colombian government of Iván Duque. But it will take time to achieve the full recovery of its economy and society after more than a decade of savage Western aggression, still in force, as demonstrated by the recent renewal by the European Union of its illegal coercive measures against Venezuela.

Few countries in the region are politically, economically and socially stable. In the countries of the Central American system, the Dominican Republic, Costa Rica, Panama and, especially, Nicaragua show the highest levels of stability. Nicaragua has achieved this despite the persistent aggression of the United States and its allies. The country’s society and economy assimilated in an unexpectedly short time the serious economic consequences of the violent failed coup attempt of 2018, organized by the United States and some countries of the European Union. They had practically overcome the effects of that failed coup attempt when Covid-19 appeared in 2020, a challenge which Nicaragua’s government under President Ortega also overcame with exceptional success

Similarly, Nicaragua has managed to adjust its economy to successive North American and European illegal coercive measures over the last five years, achieving GDP growth this year of more than 5%, among the highest in Latin America and the Caribbean. The municipal elections last November 6th proved that Nicaragua has achieved levels of political and social cohesion and unity, of peace and citizen security that remain a distant dream for the rest of Latin America. Together with the revolutionary processes of Cuba and Venezuela, the People as President in Nicaragua defend the country’s national sovereign dignity, actively promoting the region’s emancipation and integration in a multipolar world, with no illusions that the West’s genocidal elites are going to give up voluntarily one iota of their economic power.


This article was originally published on Tortilla con Sal, translated from Spanish.

Stephen Sefton, renowned author and political analyst based in northern Nicaragua, is actively involved in community development work focussing on education and health care. He is a Research Associate of the Centre for Research on Globalization (CRG).

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