U.S. Engagement in Latin America: a Global Repositioning or a Transactional Approach
Disclaimer: This analysis was written prior to the arrest and extradition of Venezuela’s Nicolás Maduro on January 3, 2026. At time of publication, this event was still in development. At present, there is little indication that it represents a shift away from the consistent transactional behavior of the Trump Administration observed and described in this analysis. The response of the international community and subsequent developments will dictate the next phase and provide greater clarity.
Key Notes
Recent U.S. tariff actions in Latin America function primarily as short-cycle bargaining tools rather than components of a unified hemispheric trade framework. The pattern emphasizes discrete, outcome-specific engagements over region-wide integration.
Economically-oriented tariffs toward smaller Latin American markets coincided with improved access for U.S. exporters, while politically motivated tariffs against Brazil produced limited reciprocal effects. In the Brazilian case, domestic price effects in the U.S. preceded tariff removal without parallel concessions.
Increased U.S. activity in Latin America aligns with a transactional foreign-policy operating model rather than a reallocation of strategic focus away from other regions. Concurrent U.S. engagement across the Indo-Pacific, Europe and the Middle East remains substantial.
U.S. Tariff Reductions in Latin America
On November 13, the White House announced trade agreements with El Salvador, Argentina, Ecuador, and Guatemala. On November 20, it removed high 40% tariffs on Brazilian agricultural products. The White House has had mixed results with its push for rapid, transaction-focused market access across the Western Hemisphere. In these trade engagements, the U.S. attempts to advance its economic and strategic interests.
The agreements between the U.S. and El Salvador, Argentina, Ecuador, and Guatemala were focused on trade. Regarding the U.S. and El Salvador, trade-related red tape was slashed for automotive and agricultural products, among others. In Argentina, similar barriers are being removed for U.S. exports, such as machinery and technology, while the country improves its internal patent standards. Guatemala will more easily allow U.S. digital payment systems and boost labor standards. Ecuador vows to prioritize environmental protection and lower tariffs on U.S. imports, as noted by the White House.
Removing the 40% tariffs on Brazilian agricultural exports, which included goods such as beef, coffee, cocoa, and other food imports, was a political move rather than a trade-focused one. The tariffs were removed after “ongoing” negotiations following a call with Brazilian President Lula on October 6. While the White House is believed to have made this decision to lower domestic food costs, the U.S. did not receive tangible economic benefits from Brazil as it did with other Latin American countries. The Brazil tariffs were imposed as a response to now-jailed former President Bolsonaro having been found guilty of sedition-related charges. He was recently imprisoned after breaching the terms of his house arrest.
Transactional Engagement In Latin America
The White House used these tariffs for transactional means, with the hope of arriving at improved economic or political conditions compared to when Trump took office in January. The tariffs on these countries (minus Brazil) were originally imposed in April and were called “reciprocal” tariffs that followed the “Liberation Day” tariffs, while the Brazil tariffs were implemented in July.
The results of the transactional tariffs were mixed. The hope for the non-Brazil tariffs was economic wins, while political gains were expected from the Brazil tariffs. Analysis will be divided into these categories.
Tariffs For Economic Outcomes
The economic tariffs towards El Salvador, Argentina, Guatemala and Ecuador appear to have improved trade for U.S. firms selling to Latin America. Since these countries have lifted certain trade barriers or regulatory requirements, it is easier for U.S. goods to enter these markets. For example, El Salvador adopted U.S. standards for automobiles, medical devices, and U.S.-grown agricultural products, which makes exporting to El Salvador easier for U.S. firms. For Argentina, which does not have a free trade agreement like El Salvador and Guatemala, bilateral tariffs were reduced, allowing more U.S. goods to enter its market. Reduced tariffs for U.S. imports is a clear benefit for Argentinians, as cheaper products will support the government’s slowing inflation goals. Overall, the White House’s decision to remove the tariffs followed concessions that overwhelmingly benefit U.S. companies.
While the trade deals benefit the U.S., Latin American allies were backed into a corner with high tariff rates and were forced to provide incentives to the White House to support their own economies. Additionally, the White House’s trade tactics undoubtedly hurt its relationship with these nations. Instead of entering trade talks in a non-hostile manner where the parties could have been seen as partners or allies, the tariffs were used as harmful leverage to demonstrate unequal power dynamics, harming the country’s exports. Imposing tariffs on goods from El Salvador and Guatemala probably violated the terms of an existing free trade agreement.
Tariffs For Political Outcomes
The politically-motivated tariffs against Brazilian imports are the exception, where Brazil likely benefited more than the U.S. When tariffs were first introduced in July, including those on agricultural goods like coffee, the U.S. consumers will feel the impact of higher coffee prices. Reports indicated that while U.S. imports of Brazilian products decreased, Brazil’s exports to other markets increased and, ultimately, economic activity did not suffer. Since the White House seeks to lower domestic food prices, and Bolsonaro was sentenced and jailed, the tariffs were abandoned without achieving their intended goals. In fact, the tariffs on Brazilian imports created self-imposed economic harm due to the domestic backlash the White House received for higher prices.
Thoughtful Diplomacy or One-Off Deals For Headline Wins
The current moment has revived the question: Does renewed U.S. activity in Latin America represent a strategic pivot to its original sphere of influence or simply another transactional layer in a broader, globally-distributed posture?
On the pivot towards Latin America, this argument states that the U.S. is reasserting its historical influence in the Western Hemisphere while scaling back involvement elsewhere. The other argument maintains that Washington is fully engaged worldwide and is simply deploying opportunistic, deal-centric tools in Latin America to hedge against competitive pressure, especially from China.
The U.S. rarely concentrates its attention in one geopolitical region for long periods of time, and the same is true in Latin America. For more than a century, Washington’s policy toward the region oscillated between asserting regional dominance, selective engagement, and periods of global distraction. The Monroe Doctrine’s hemispheric exclusivity (1823), Cold War containment (1947), and the post-2000 era of diversified commitments across Europe, the Middle East, and the Indo-Pacific each evince ever-shifting areas of concern. Though the U.S. attempted a comprehensive Western hemisphere integration model in the early 2000s, such as the Free Trade Area of the Americas, it was never implemented.
Since January, U.S. actions in Latin America carry a consistent operational signature: limited-scope deals that deliver immediate policy wins, rather than a region-wide strategic doctrine. These agreements remove non-tariff barriers and enable frictionless access for American exporters. They are cost-efficient attempts to influence economies where the U.S. seeks regulatory alignment, either to compete with China or just project power.
U.S. government officials, however, discuss Western Hemisphere relations with broader objectives. Treasury Secretary Scott Bessent likened the $40 billion bailout for Argentina to an “economic Monroe Doctrine.” Secretary of War (formerly Secretary of Defense) Pete Hegseth wrote, “The Western Hemisphere is America’s neighborhood — and we will protect it.” Former special envoy to Latin America, Mauricio Claver-Carone, said, regarding President Trump, that he “believes this is the neighborhood we live in…And you can’t be the pre-eminent global power if you’re not the pre-eminent regional power.” The quotes from Hegseth and Claver-Carone came from an article titled “The ‘Donroe Doctrine.’”
Why Renewed Attention Does Not Equal Disengagement Elsewhere
If the U.S. were meaningfully pivoting toward Latin America, we would expect a corresponding capacity reduction in other theaters. That is not occurring. The scale and density of U.S. activity in the Indo-Pacific, the Middle East, and Europe remain substantial. Latin America is being brought into the frame as another arena of interest, not a replacement for existing commitments.
China’s expanding presence in Latin America is a material factor. Beijing’s investment in ports, mining, energy infrastructure, and telecommunications has increased regional exposure to China’s commercial and strategic ecosystem. Washington’s countermeasures, including the recent trade agreements, reflect a defensive positioning and an attempt to be opportunistic. However, China is not the sole driver; it functions as a catalyst rather than a master variable. The U.S. is responding to competitive dynamics across multiple regions simultaneously.
Globally, the U.S. maintains high-intensity engagement elsewhere. In the Indo-Pacific, deepened defense coordination with Japan and the Philippines, combined with operational programs supporting Taiwan and AUKUS implementation, reflects sustained resource allocation. In the Middle East, Washington continues maritime-security operations, Iran deterrence, and Israel-Arab crisis management. In Europe, support structures for Ukraine and NATO modernization remain active and volatile. These examples demonstrate that the U.S. is not reallocating resources from global theaters to Latin America; it is executing a diversified foreign policy portfolio while exploiting near-region efficiencies.
The unifying theme across Latin America and other regions is the rise of a transactional operating model. The U.S. is prioritizing issue-specific outcomes, controlled risk exposure, and rapid policy wins. This approach offers speed and flexibility but lacks the coherence of a grand strategy or doctrine.
Forecast and Risks
Baseline: The U.S. is likely to maintain a transactional, issue-specific engagement pattern in Latin America, driven by competitive pressure from China, select headline wins on topics like migration and narcotics (like drone strikes in international waters), and the low-cost efficiency of bilateral regulatory deals.
This trajectory persists because it maximizes short-term gains without requiring institutional redesign or significant resource reallocation from other global theaters. The most probable outcome is a steady but uneven policy rhythm, in which Washington sustains or improves commercial agreements while maintaining selective security coordination and political alignment where convenient. This approach remains the baseline because it aligns with current U.S. executive preferences, congressional fragmentation, and the broader multipolar environment.
Variation: A more consolidated hemispheric posture becomes possible if global volatility intensifies or if Indo-Pacific commitments become more expensive to manage, making near-shoring and supply-chain resilience higher priorities.
Under those conditions, deeper U.S. engagement with key Latin American markets could emerge as a strategic buffer. Conversely, a fragmented engagement pattern could develop when domestic constraints increase or regional governments diversify their partnerships, thereby reducing U.S. leverage. These variations are contingent on shifts in fiscal capacity, political turnover, commodity cycles, and the scale of China’s regional entrenchment. They become plausible when material incentives change rather than from ideological reorientation.
Risks: A material risk scenario is that Latin American countries may choose to align themselves closer to Europe or China, thereby distancing themselves from the U.S. In this case, recent pressure from the White House and historic policy changes in Latin America have led countries to become exhausted by U.S. actions and seek more consistent or stable trading partners. In China’s case, President Xi has been in power since 2013 and will likely remain in power for years to come. Xi’s government would serve as a constant to ever-changing U.S. policies.
