By María Luisa Ramos Urzagaste
The expansion of U.S. influence in Latin America and the Caribbean through the America Grows (America Crece) Initiative allows the U.S. to avoid mandatory parliamentary controls in the countries involved and moves toward reforming the region’s economic, financial, and political dependence.
The America Grows Initiative, launched in December 2019, has a very truncated format: it is expeditious, short, and does not require any negotiation between government agencies. Nor does it require consultations with parliaments, much less involve segments of civil society, because the Memorandum of Understanding format allows for this.
This is just as U.S. President Donald Trump likes it, the mechanism to strengthen the presence of U.S. companies in Latin America and the Caribbean simply by requiring the signing of a Memorandum of Understanding, MOU, which seals the commitment of the government in question, to fulfill the roadmap that will be drawn by the various agencies and U.S. organizations.
Watch out! They cover more than NAFTA
Through this procedure they will no longer be involved in cumbersome negotiations of free trade agreements, FTAs, to improve their trade balance, to obtain juicy state contracts, to make changes to legislation and in general to adapt the design of the countries’ investment scheme to their interests.
Saying it like that, it sounds even more grotesque than the FTAs. Those free trade agreements that Trump doesn’t like either. Not for nothing has he buried NAFTA and imposed his own rules on the new T-MEC process.
In addition, the different administrations have already learned the history of resistance from Latin American civil society, which for years opposed these treaties and which generated many headaches not only for the different governments of the United States, but also for the rulers of the countries of Latin America and the Caribbean.
Trump and his administration also do not want to be bound by the rules of the World Trade Organization (WTO). That is why he has found the format, which seems to work for him for now, since the governments with which he has signed (note the word: signed, not negotiated) these MOUs remain kneeling to the will of Trump.
Throughout America Grows the United States and the governments of the region (where Argentina, Chile, Jamaica, Panama, Colombia, Ecuador, Brazil, El Salvador and Honduras are currently part of the region and Bolivia all recently joined) are making a high-level diplomatic commitment to set the agenda that will be drawn up by American organizations and agencies and their respective business entities in the countries.
The MOU that supports America Grows is a wide umbrella that holds everything, absolutely everything that the government of the moment allows, as long as the population does not know it, remains in chaotic quarantines, hungry and immersed in fear of the pandemic.
It is foreseeable that the US and its agencies will not be interested in investing in rural roads, or hospital improvements in some town far from the capitals, unless it is for a photo op. Now that America Grows has signed the MOU, they have the mechanism to orient government investments towards large infrastructure works, useful to their interests, where energy projects are especially mentioned, understanding gas, lithium and large hydroelectric projects, for example.
Two fundamental aspects must be underlined and reiterated in this format now applied by the United States:
The signing of an MOU allows for the evasion (for the time being) of parliaments since they are not treaties or agreements, which according to some constitutions must go through the scrutiny of those entities and even be submitted to referendums. The legal mechanism of the MOU allows them to avoid this control device.
This is not only a strong political signal but fundamentally a commitment by the signatory governments to prioritize, consult and coordinate with the US and its agencies on important investment issues.
This second point is a strong signal not only to the outside, but fundamentally to the inside of their countries since it imposes the route of the destination of the investments.
The tricky thing about these MOUs is that they seem harmless since they do not attract much attention, since, unlike treaties or agreements, it is not the president who signs, but a minister who assumes commitments that binds the entire State.
Here it is worthwhile to warn about the dimensions and critical areas involved in this mechanism of the MOU, and its subsequent agreements. Parliaments can and should make the necessary consultations and warnings to prevent future investments or project designs from the North.
It should not be forgotten that when the United States speaks of “good practices” and “transparency”, it actually refers to the implementation beyond its borders, of its own standards. It should also be noted that this Memorandum is an umbrella for many important issues, such as support for “improving its regulatory frameworks and procurement structures to meet the financing needs of projects with limited resources”.
In fact, it refers to an issue that is no less important for the countries: government procurement. In any country in the world, the biggest buyers are governments, which make the biggest contracts. That is why this issue deserves special attention because it is an important mechanism for promoting industry and companies in various national sectors. Unfortunately, it is also a focus of corruption, which is why it should be under national scrutiny, even more so now.
America Grows also promises to expedite private sector access to U.S. government financial resources and with that the U.S. candidate for president of the Inter-American Development Bank, Mauricio Claver-Carone, who still serves as deputy assistant to the president and senior director of Western Hemisphere affairs, is working hard to pave his way into the organization.
The pandemic has virtually exhausted countries’ resources and their reserves as well. Therefore, it is time for those who have these resources to make conditional loans.
That’s why the US promise to some money-hungry governments sounds appealing. The America Grows initiative promises greater investment, job creation, but with the inescapable help of US agencies including the Departments of State, Treasury, Trade and Energy, the Agency for International Development (USAID), the US Trade and Development Agency (USTDA) and the Overseas Private Investment Corporation (OPIC).
There is no doubt that this is a Trojan horse. Does anyone really think that Trump and his tricky mechanisms will be the ones willing to help solve the problems of dependency and impoverishment in Latin America and the Caribbean?
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