This came up after I posted this week’s Carnival, and it deserves attention: The Latin American and Caribbean Summit on Integration and Development starts tomorrow.
Latin American and Caribbean leaders gathering in Brazil tomorrow will mark a historic occasion: a region-wide summit that excludes the United States.
Almost two centuries after President James Monroe declared Latin America a U.S. sphere of influence, the region is breaking away. From socialist-leaning Venezuela to market-friendly Brazil, governments are expanding military, economic and diplomatic ties with potential U.S. adversaries such as China, Russia and Iran.
The Bloomberg article makes much of the “death of the Monroe Doctrine”. Please go read it – I’ll wait.
Before we all go having conniptions, it’s worth noting that the Foro de Sao Paolo has been around for quite a while (18 years, to be exact). That a new Latin American and Caribbean Summit on Integration and Development is now on schedule doesn’t change anything.
There are a number of things worth noting, however:
1. The interest for free trade agreements among countries, either bilateral or multilateral, which China and Russia are keen to negotiate. As I mentioned in this blog last month, China and Peru signed a free trade pact.
2. The continued dependence of Latin American economies on natural resources, such as oil, which have been hit hard by the world financial crisis.
3. Brazil’s emerging position of leadership in the region. Long-time listeners of my podcasts know that I am very optimistic on Brazil, which has all the potential to become an economic superpower. Let’s hope it does.
4. The increase in weapons:
Changing relationships are also evident in arms deals. Chavez turned to Russia for at least $4.4 billion in weapons after the U.S. blocked sales of aircraft parts. Brazil, the region’s largest economy, is also shopping around: Defense Minister Nelson Jobimsaid in Washington this month that his government will only buy weapons from countries that agree to transfer technology for local production.
Plans to purchase 36 new fighter jets, in which Boeing’s F- 18 is competing for a contract against Stockholm-based Saab AB and France’s Dassault Systemes SA, “can only be justified politically if they contribute to national development,” Jobim said.
Brazil may sign a deal with France for four nuclear submarines intended to help secure its oil basins in the Atlantic when French President Nicolas Sarkozy visits Brazilian President Luiz Inacio Lula da Silva this month.
Brazil may have the money to do so. However, the Russia-Venezuela deals hinge on the price of oil: Chavez will have to pay hard cash, since the Russians probably don’t take MasterCard, and his economy is entirely dependent on oil revenues.
What may be a game-changer instead is the increased presence of Russian battleships in the Caribbean. Even then, it will all depend on the new administration’s reaction.