Trouble for Washington in the Americas

Dear all,

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

In this issue, you will find:

• The Western Hemisphere Must Step Up Its War on Crime

• Inside Trump’s Venezuela Divide

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The GCaM Team

Latin America remains the world’s most violent region, facing a deepening crisis driven by transnational organized crime.

Overview. Unchecked violence and criminal networks erode legitimate political institutions, hinder development, and fuel mass migration—with consequences that extend far beyond the region’s borders, most notably impacting the United States.

• While some criminal organizations wield vast resources and sophisticated networks, their activities result in significant economic losses for the region—while also endangering public safety and social cohesion.

• A 2022 report from the Inter-American Development Bank (IDB) estimates that crime costs Latin America approximately 3.4% of its GDP—roughly equivalent to what the region spends on infrastructure.

• Perception of insecurity—with the exception of El Salvador, which we’ll address later—is also rising across the region. In Mexico, for instance, a recent survey by the Texas Public Policy Foundation found that 78% of voters believe the country’s security situation poses unacceptable risks to their safety, while 83% consider cartels to be a serious threat.

Why It Matters. Transnational crime syndicates, such as Mexico’s Sinaloa and Jalisco New Generation cartels and Colombia’s Clan del Golfo, are not mere gangs but illicit multinational corporations generating an estimated $150 billion to $250 billion annually.

• Their portfolios span drug trafficking—particularly cocaine and fentanyl—human smuggling, illegal mining, oil theft, and extortion. That alone poses a major challenge, but the threat deepens as these revenues are used to fund private armies that control entire municipalities, eroding state authority.

• But their challenge to institutional power doesn’t stop there. It’s no secret that these organizations have also managed to infiltrate or influence the highest levels of governments closest to the U.S. border—most notably in Mexico, where such influence has persisted for decades, and in Honduras, where former President Juan Orlando Hernández is currently imprisoned for his role in drug trafficking.

• Furthermore, in Guatemala, recent legislation easing money laundering through cattle sales exemplifies how legal loopholes enable criminal enterprises to flourish, demonstrating how these groups influence political decisions to favor their interests.

Between the Lines. Nayib Bukele has become a regional icon for his iron-fisted approach to gang violence, reducing homicides from 53 per 100,000 in 2018 to 2.4 in 2024. Nonetheless, neither the U.S. nor other countries in the region should signal— as they have been recently doing— that Bukele’s playbook is an effective way to deter the growing power and influence of organized crime in the region.

• The Salvadoran president’s strategy, involving mass incarceration and militarized policing, targeted loosely organized, extortion-based gangs like Mara Salvatrucha, whose members earned as little as $15 per week.

• This model is ill-suited for confronting transnational cartels. Bukele’s targets were low-level, urban criminals, not the sophisticated, resource-rich organizations dominating most of the regions illegal activity market.

• So far, this approach has worked, but it does not appear sustainable in the long run. Economic and social conditions remain unchanged, and the growing prison population continues to strain public resources. Moreover, Latin American nations require tailored solutions—not a one-size-fits-all model.

Bottom Line. Latin American nations are growing increasingly wary of U.S. intervention in their domestic affairs, and history offers clear warnings against heavy-handed approaches. However, if the U.S. intends to maintain its claim as the leader of the Western Hemisphere—now heavily contested by China—a more effective strategy would be to prioritize security partnerships that strengthen and empower local authorities.

• This includes bolstering resources for specialized units targeting money laundering and arms trafficking, expediting the extradition of cartel leaders, and enhancing intelligence sharing.

• Rather than channeling millions into NGOs with political agendas, Washington should focus on strengthening security infrastructure and training. After all, it is in the U.S.'s own interest—a double win that exemplifies what a real partnership should look like.

• The crisis of organized crime in Latin America threatens the entire Americas—fueling U.S. drug epidemics and undermining public institutions throughout the region. That’s why a hemispheric security framework, led by the U.S. and focused on dismantling cartels’ financial and logistical networks, presents a viable path to restore stability and prosperity across the continent.

Toppling Maduro’s regime without jeopardizing U.S. oil interests in Venezuela is becoming one of Trump’s most knotty foreign policy challenges.

Big Picture. The appointment of Marco Rubio as Secretary of State signaled a foreign policy sharply focused on Latin America—and particularly tough on the regimes in Venezuela, Cuba, and Nicaragua. Although removing Nicolás Maduro is a top priority for Trump, the approach must be surgical.

• Beyond being a humanitarian catastrophe, Maduro represents a national security threat to the United States.

• His regime has flooded the country with narcotics, triggered waves of illegal migration, and opened the region’s doors to Putin, China, and Iranian-backed terrorism.

• Still, oil remains a lifeline shielding Maduro from more aggressive U.S. action.

Between the Lines. In February, Trump reached an agreement with Maduro to accept deportation flights to Venezuela.

• The deal was brokered by Florida oil magnate Harry Sargeant III. Along with U.S. Special Presidential Envoy for Special Missions Richard Grenell, Sargeant is a leading figure in the coalition that, in some ways, ensures Maduro’s stability.

• Grenell and Sargeant are not supporters of the Venezuelan dictatorship—but they are staunch defenders of U.S. oil companies operating in the country.

• Trump’s secondary sanctions aim to serve these interests, targeting other countries that import Venezuelan oil while benefiting U.S. firms still doing business there.

Yes, but. Following the agreement facilitated by Sargeant III, there was speculation that Trump might soften his stance on Maduro. However, days later, the administration revoked Chevron’s import license. Trump blamed the move on the breakdown of Venezuela’s democratic process during the 2024 elections.

• This 180-degree pivot aligns with the hardline stance of the State Department under Marco Rubio.

• The Cuban-American Republican is a fierce critic of socialist regimes in Latin America and a strong advocate of sanctions-based diplomacy.

• Rubio believes the U.S. must impose economic sanctions that suffocate the regimes of Maduro, Díaz-Canel, and Ortega to force them from power.

What’s Next. As tensions rise, Xi Jinping has positioned China as Maduro’s lifeline, offering loans, military equipment, and technology in exchange for oil. China—not the U.S.—is now the largest importer of Venezuelan crude. While Sargeant III and Grenell, as well as Rubio, share the goal of weakening Maduro’s regime, their motivations and methods diverge.

• One faction prioritizes securing U.S. business interests in Venezuela as a way to maintain leverage over its oil.

• The other sees Maduro as a national security threat and a humanitarian crisis that must be eliminated—with oil interests as a secondary concern.

• The Trump administration will likely oscillate between these two positions, as neither faction can completely sideline the other—leaving China with an opportunity to expand its influence.

What We’re Watching 🔎 . . .

Xi Jinping tries to press China’s advantage in South America [link]

The Economist

At the ministerial meeting of the China–CELAC Forum held in Beijing, President Xi Jinping announced a USD 9.18 billion credit line for member countries of the Community of Latin American and Caribbean States (CELAC), along with new infrastructure projects. The move aims to deepen China’s presence in a region where bilateral trade reached USD 515 billion in 2024.

Despite China’s economic slowdown, the country remains a strategic partner in the Global South—particularly for Brazil, which continues to benefit from Chinese demand for agricultural products. However, Brazil also warned of the risks tied to overdependence on external financing, advocating for Latin American autonomy in the face of global powers.

China’s influence in the region continues to grow, gradually displacing the United States despite Donald Trump’s efforts to dismantle Beijing’s presence.

DP World signs $760m Dominican Republic port & free trade zone MoU [link]

Gary Howard, Seatrade Maritime News

DP World and the Dominican Republic have signed a USD 760 million memorandum of understanding to expand the Port of Caucedo and its free trade zone, aiming to position it as the most advanced logistics hub in the Caribbean.

The project includes increasing port capacity from 2.5 to 3.1 million TEUs and opening 225 hectares of land for industrial development.

USD 380 million will go toward strengthening port infrastructure—expanding the dock, adding state-of-the-art cranes, automation systems, and enhanced security—while the remaining USD 380 million will fund road infrastructure, utilities, and facilities to attract global companies to the free trade zone.

With over 25 years in the country, DP World expects the plan to drive USD 3.9 billion in foreign direct investment, USD 4 billion in manufacturing output, and generate thousands of new jobs.