October 17, 2017
Geopolitical and Security Developments in the Americas: What They Mean for Business
By Jesus Sanchez
Following welcome remarks by Ted Murphy, partner at Baker McKenzie, Gen. Fraser opened the event by addressing security trends in the region, including the Colombian peace process and the crisis in Venezuela. He noted the positive movement of the Colombian peace process, and the challenges of long-term success, while also highlighting the need to address the problem of growing coca production. When discussing the crisis in Venezuela, he described the several ways the government is trying to hold on to power, doors the crisis has opened for Russia, China and Iran to increase their influence in the region, and the danger of increased mass migration as the humanitarian crisis deepens.
Above all, Gen. Fraser named transnational criminal organizations as the biggest security concern in the region. Their ability to undermine governments in the Northern Triangle through corruption and violence creates a need, he argued, to address their operations in and beyond Central America.
Following keynote remarks, the conversation opened with a discussion of the biggest challenge for the United States in the region. Gen. Fraser expressed concern with the availability of US forces in the region for traditional operations and emergencies as the United States turns its focus toward security threats from Russia, the Middle East and East Asia.
Dr. Chavez highlighted the bilateral security relationship with Mexico is under threat by tensions stemming from the North American Free Trade Agreement (NAFTA) renegotiations. She further argued that “a reduction in any of four areas of cooperation [counterterrorism, counternarcotics, coordinated efforts in the Northern Triangle, disaster response] could be very bad for stability in North America, but also Central America.”
Focusing on opportunities for businesses in the region, Miguel Noyola noted the North American Free Trade Agreement’s (NAFTA) significance for regional economic growth. “For Mexico, [NAFTA] propelled the country from being a closed economy to one that feels competent competing in global markets. So, with or without NAFTA we have [already] adopted that shift.”
While he emphasized the urgency of fully appreciating the damage NAFTA’s collapse would inflict on the United States, adding that he would expect the US Congress to intervene if NAFTA were to approach such a point, Peter McKay expressed optimism for the long term. He emphasized the trilateral relationship has and will continue to traverse a single country’s administration: “We are going to get through this. Administrations will come and go. This relationship in North America between Canada, the US and Mexico has a long enduring history,” he stated.
Beyond North America, Gen. Fraser discussed the growing influence of US competitors in the Americas, noting that “the opportunity presented to China by a changing dynamic in NAFTA or any trade relationship is real and is of geostrategic concern to the United States.” He added that “China is looking for every opportunity to fill a void… but I also take example that Russia is not out of this opportunity… They are looking for any opportunity to undermine the efforts of the United States to engage.”
Pivoting to the position of US companies on the current NAFTA renegotiations. Mr. Noyola argued that private enterprises are adaptable and will continue to find investment opportunities abroad regardless of trade agreements.
Minister McKay added that he expects NAFTA negotiations to continue well into next year considering the complexities and lack of immediate progress negotiations have yielded so far.
To conclude, the panel addressed the impact of next year’s elections in the region on the security and economic relationships with the United States. Minister McKay and Dr. Chavez agreed certain policies coming out of the United States have helped the leftist populist candidate in Mexico, Andres Manuel Lopez Obrador (AMLO), increase his support for the upcoming election, with Dr. Chavez and Mr. Noyola both agreeing that he would win if elections were held today. Mr. Noyola concluded that even if AMLO wins he expects a more mature civil society to act as a check on his power and therefore moderate his more radical policies.