Power Plays from Washington to Tegucigalpa

Dear all,

We welcome you to the Greater Caribbean Monitor (GCaM).

In this issue, you will find:

• INL Weaponized Aid for Politics, Not Security

• Honduras on Track for a Political Shake-Up

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The GCaM Team

In Context. On Thursday, the U.S. House Subcommittee on the Western Hemisphere held a hearing titled “INL Should Fight Crime, Not Conservatives.” The session was led by Republican Congresswoman María Elvira Salazar, chair of the subcommittee.

• Witnesses included Chelsa Kenney of the U.S. Government Accountability Office (GAO), Andrés Martínez-Fernández of The Heritage Foundation, and Adam B. Isacson of the Washington Office on Latin America (WOLA).

• Rodrigo Arenas, publisher of República, was initially invited to testify but was removed at the last minute — reportedly due to pressure from antagonistic Guatemalan operatives and their American allies.

Why It Matters: The hearing highlighted the failures of the State Department’s Bureau of International Narcotics and Law Enforcement Affairs (INL), which has allegedly prioritized funding ideological agendas over combating organized crime — particularly during the Obama and Biden administrations. According to Kenney, the GAO issued 16 recommendations to INL since 2020 to enhance program effectiveness, most of which were ignored.

• The GAO reported that INL has allocated up to $3 billion to fight crime and strengthen the rule of law in Mexico, yet has failed to meet its objectives, in part due to its disregard for oversight recommendations.

• Kenney emphasized that INL has deliberately overlooked recommendations addressing shortcomings in performance management, monitoring, and program evaluation.

• Congresswoman Salazar criticized the agency, stating that it has replaced counternarcotics efforts with “seminars on pronoun usage and gender diversity workshops.”

The Other Side. WOLA’s representative praised INL’s past support for the now-defunct CICIG anti-corruption body in Guatemala. However, despite ongoing U.S. funding, human and drug trafficking have persisted. Under the Biden administration, the U.S. has recorded historic highs in southern border migrant encounters and in methamphetamine and fentanyl seizures.

• When questioned by Subcommittee Chair Salazar, Isacson shifted focus to defending the U.S. prosecution of Guatemalan Attorney General Consuelo Porras, despite previously advocating for judicial strengthening in the region.

• Salazar noted that nearly nine million Guatemalans have attempted to migrate to the U.S. in recent years, yet received no support from INL, which refused to cooperate with Guatemala’s Public Ministry.

• “This is the textbook definition of placing politics and ideology above security and respect for the political will of our neighbors,” she rebuked.

What’s Next. With Republicans holding the majority in both the Subcommittee and the House Foreign Affairs Committee, there is mounting pressure for accountability over what they describe as blatant negligence under Democratic administrations.

• This shift in U.S. foreign service priorities signals a potential move toward pragmatic, non-ideological development programs in Latin America.

• Still, efforts to silence those willing to expose the misconduct of agencies like INL persist — in Guatemala and, increasingly, in the Unites States.

The last Honduran general election, which brought Xiomara Castro — a self-described socialist and the wife of ousted former president Manuel Zelaya — to power, marked a pivotal shift in the country’s political landscape.

• The 2021 electoral process signaled the return of the left to Honduras’ government and unfolded amid growing scrutiny of then-President Juan Orlando Hernández, whose administration had come under judicial investigation.

• These inquiries ultimately led to Hernández’s extradition to the United States on drug trafficking charges, following the earlier conviction of his brother, Tony Hernández.

Why It Matters. Amid the lingering turmoil sparked by these events, Honduras is now just months away from a general election. Recent primary results have offered an early sign of the country’s shifting political sentiment.

• Castro’s party, Libertad y Refundación (Libre), saw an unusually high share of invalid votes — 18 percent — in a two-candidate primary. The result suggests that the president struggled to transfer her rural, populist, and revolutionary legitimacy to her chosen successor, Rixi Moncada.

• Although Partido Nacional (PN) secured a considerable share of votes, its preferred candidate, Nasry Asfura, does not appear to be a viable option for much of the electorate. Despite adopting a silence strategy to distance itself from the stigma of Hernández’s extradition, the party has struggled to redefine its identity or credibly champion an anti-corruption agenda.

• Lastly, Salvador Nasralla — who was Castro’s running mate in the last election and served as vice president until last year — is now running as the candidate for the Partido Liberal (PL). He has emerged as the preferred choice among the country’s economic elites and voters with strong anti-corruption preferences.

What’s Next. Following the release of a video by Insight Crime linking the president’s brother-in-law — who serves as the secretary of Congress — to high-profile drug traffickers, Libre’s campaign is facing a public opinion crisis.

• The past two elections have leaned toward punishment votes against parties and candidates implicated in corruption and drug-trafficking scandals, particularly in departments with high concentrations of economic activity, where voters tend to place their trust in moderate figures like Nasralla.

• If Nasralla’s party can consolidate floating voters from both Libre and PN, it is likely to gain enough leverage to form alliances in which it plays a dominant role in government — or, as some suggest, even win the presidency.

Between The Lines. Honduras — along with Guatemala and El Salvador, which make up the Northern Triangle of Central America — has gained heightened geopolitical significance for Washington due to its central role in migration and drug trafficking routes.

• Tegucigalpa has maintained a historically close relationship with the United States, including hosting the largest U.S. military base in Central America: Soto Cano Air Base.

• While the relationship has faced ups and downs — strained by Honduras’ pivot to China, deep ideological differences, and recent tensions between the Trump and Castro administrations — Washington and Tegucigalpa are expected to “bury the hatchet” and strengthen ties once a new government is elected.

• Even Taiwan’s re-recognition could return to the table, following the relative failure of Honduras’ economic pivot toward China — a move that brought limited short-term benefits while raising concerns over long-term sovereignty.

In Conclusion. Voter turnout surged in the 2021 elections, driven by the high political stakes. Hondurans faced a stark choice between historically corrupt parties and a populist worker movement energized by a renewed, inflammatory narrative around the 2009 coup — now framed more than ever as illegitimate.

• Yet the Castro administration has fallen short of expectations: nepotism remains widespread, corruption persists, and the prosecution of her brother-in-law is widely seen as a façade.

•  With disillusionment growing, the political winds may once again be shifting.

Panama Ports Deal Touted by Trump to Miss April 2 Deadline [link]

Raffaele Huang and Costas Paris, The Wall Street Journal 

Following a significant rise in tensions between Beijing and Washington over control of the Panama Canal and several strategic ports, China’s antitrust regulator will review the $23 billion deal in which BlackRock seeks to acquire key assets from Hong Kong conglomerate CK Hutchison, including two ports located at either end of the interoceanic route.

Although the transaction was initially set to close on April 2, a delay is now expected due to China’s regulatory intervention. While Trump described the deal as a step toward “retaking” control of the canal, Beijing voiced its displeasure and warned of potential regulatory challenges targeting BlackRock.

 Stopping Venezuela’s Exodus Hinges on Restoring Hope [link]

 Dany Bahar and Ricardo Hausmann, Americas Quarterly

The mass exodus of Venezuelans to the United States continues unabated, despite economic sanctions and attempts to appease Nicolás Maduro’s regime. At the root of the phenomenon lies widespread despair: Venezuelans are migrating with the conviction that meaningful change in their country is virtually impossible. While sanctions do impact the economy, it is the collapse of hope that truly drives the flight.

The recent surge in oil revenues — strengthening the regime’s grip on power — has only deepened the sense of stagnation. In response, Trump announced a 25% tariff on countries importing Venezuelan oil, following the revocation of Chevron’s license to operate in the South American nation. The move, primarily affecting China and India, aims to ramp up pressure on Maduro.