Strengthening Ties: U.S.-Latin America Integration for Mutual Benefit

Despite the controversy surrounding Venezuela’s recent election, the strategic potential for closer U.S.-Latin America integration remains strong, offering opportunities in energy, natural resources, and supply chains.

The recent Venezuelan election has drawn widespread condemnation and accusations of fraud, but this should not overshadow the strategic potential of closer U.S.-Latin America integration. Several Latin American countries’ rejection of Venezuela’s election results signals a readiness for stronger ties between the North and South of the Western Hemisphere. A few radical regimes like Venezuela should support pursuing a more robust relationship that can benefit both regions.

The Western Hemisphere’s regions complement each other well regarding energy, natural resources, and supply chains, with a shared commitment to democracy. Such a policy should garner bipartisan support in the U.S., providing a foundation for renewed efforts toward hemispheric integration. Since the successful completion of the United States-Mexico-Canada Agreement (USMCA), there has been minimal effort to integrate the hemisphere, with Latin America primarily out of focus except during immigration surges at the southern border.

Energy Abundance and Technological Advancement

One of the most promising areas for North-South cooperation is energy. Latin America boasts an abundance of renewable energy, a crucial factor for technological advancements like artificial intelligence (AI). For example, Brazil leads the world with 93% of its power generation from renewable sources, including a thriving ethanol industry. In comparison, renewables generate about 20% of U.S. electricity, and only 10% of U.S. cars use ethanol.

Battery energy storage is essential for increasing the use of renewable energy, and lithium, a critical raw material in batteries, is abundantly available in South America. The “Lithium Triangle” of Argentina, Bolivia, and Chile holds over 49 million tons of lithium reserves, compared to 7 million tons in the U.S. This abundance positions Latin America as a critical partner in achieving energy goals.

However, Latin America’s reliance on hydroelectric power has downsides, such as vulnerability to droughts driven by climate phenomena like El Niño. The U.S. can help mitigate these effects with its expertise in systems engineering management, diversification, and grid interconnection. For instance, Georgia Tech has collaborated with the Brazilian system operator to optimize their energy system. By working together, North and South America could effectively address the power grid capacity needed for the immense data center energy consumption required by AI advancements.

Addressing Challenges and Enhancing Cooperation

Despite its potential, the region faces well-known challenges such as drug trafficking, illegal destruction of the rainforest, and corruption. These issues are complex, but the U.S. has provided valuable aid and assistance. Regardless of which party holds the White House, this assistance should be intensified with fresh ideas and increased cooperation. All these issues can improve with greater North-South economic collaboration and the incentives it brings.

Renewing integration efforts between North and South America requires solid political and commercial infrastructure to support significant investments in physical infrastructure, like those needed for AI advancements. This concept is familiar and was the basis for the gradual creation of the Americas Free Trade Area. While the EU successfully integrated challenging countries into a beneficial community, Latin America is more complex and independent-minded. Financing or directing integration to the same extent as in Europe is unrealistic, but the effort is crucial for mutual benefit.

Renewing Integration Efforts

The global landscape, marked by profound changes, warrants a bipartisan reconsideration and renewal of efforts to achieve greater integration among Western Hemisphere countries. The U.S. and the broader West face worldwide challenges, with geopolitical shifts emphasizing the need for a more integrated Western Hemisphere. Such integration can enhance geopolitical stability, economic dynamism, and access to natural resources while shortening global supply chains.

Washington should adopt a strategy that addresses geopolitical and foreign policy concerns while enhancing economic prospects, preserving access to key natural resources, and fostering local alliances. This approach would bolster stability and democracy, control crime, and effectively manage immigration. By focusing on mutual interests and shared challenges, North and South America can build a stronger, more resilient partnership.

The controversy surrounding Venezuela’s recent election should not deter the U.S. and Latin America from pursuing closer integration. The strategic potential for energy, natural resources, and supply chain cooperation is immense. By renewing efforts for hemispheric integration, both regions can achieve more excellent stability, economic growth, and a more substantial commitment to democracy. The time is ripe for a new era of collaboration that benefits the entire Western Hemisphere.

Also read: US vs. China’s Tug-of-War for Strategic Influence in Latin America 

This article was adapted from the opinion of Tom Tribone (CEO of Franklin Park Infrastructure and chairman of the Great Lakes Energy Institute) and published in The Dallas Morning News.