Jorge Heine
Says More…
This week in Say More, PS talks with Jorge Heine, a research professor at the Pardee School of Global Studies at Boston University.
Project Syndicate: Last year, you warned that Latin America would be the region most affected by a second Donald Trump presidency. What must Latin American governments do to cope with the effects of Trump’s policies on the regional and global economy, and, more broadly, to escape the “deepest economic downturn” the region has faced in 120 years?
Jorge Heine: Trump’s actions – including mass deportations, unpredictable tariffs, and the threat of a US “takeover” of the Panama Canal – pose monumental challenges to Latin America.
How leaders approach bilateral engagement is clearly important. Contrast Mexican President Claudia Sheinbaum’s measured yet firm response to Trump’s tariffs with Panamanian President Jose Raul Mulino’s capitulation to Trump’s demands, including that the country accept deportation flights carrying nationals from other countries and reduce China’s “influence” regarding the Panama Canal.
Latin America would be better off, however, if it devised a collective response. The region remains deeply fragmented, as shown by the cancellation of the Community of Latin American and Caribbean States (CELAC) summit in January. But Albert Ramdin’s election this month as secretary general of the Organization of American States (OAS) offers reason for hope that some measure of regional coordination may be in the offing, though the form it takes remains to be seen.
More broadly, US protectionism and economic coercion underscores the need for Latin America to continue to support multilateralism, diversify its trade and investment links, and embrace a foreign policy based on active non-alignment (ANA).
PS: A top priority for Ramdin – your preferred candidate in the OAS election – should be “restoring internal morale and dealing effectively with all the challenges posed by a US administration that is openly hostile to multilateralism.” What steps should be at the top of his agenda?
JH: The past few years have not been kind to the OAS. This is a pity, since the organization – one of the oldest and most established of the Pan-American institutions – has, at times, played an important role in inter-American relations. Ensuring that it can fulfill its potential in the age of Trump will require Ramdin to confront at least three key challenges.
The first is budgetary: the Trump administration’s suspension of US funding for specific activities, together with the refusal of other member states to increase their contributions, has put the chronically underfunded OAS under intense pressure, which Ramdin will have to find ways to ease – and adapt to. This will make overcoming the second challenge – reviving staff morale, which has reached an all-time low – all the more difficult.
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Finally, and most fundamentally, the OAS must reconnect with its sense of purpose. To this end, the OAS should look to Haiti, which is facing a catastrophic security and humanitarian crisis. The OAS has exercised considerable leadership during past crises in Haiti, and should do the same today.
PS: As you note, Trump’s return to the White House appears to confirm the wisdom of ANA. Resisting pressure to “take sides in great-power conflicts” is presumably easier for larger countries like Brazil than for their smaller counterparts. What would an active non-aligned foreign policy look like in smaller Latin American countries?
JH: ANA arose during Trump’s first presidency, as the US and China pressured Latin American countries to toe their respective lines. Just two months into Trump’s second presidency, the wisdom of ANA has been decisively reaffirmed.
The belief that ANA is available only to larger countries is widespread. But while a smaller country might have less leverage in negotiations with superpowers than a large one, that does not mean that they cannot apply ANA. After all, ANA is not a policy prescription or an ideology, but rather a kind of compass, which can guide the foreign policy of any country, large or small. This much was clear when the government of Honduras – a country of just ten million – threatened to expel American troops from the Soto Cano air base in response to the possibility of aggressive deportations by the US.
Conservative governments in Ecuador and Uruguay – two more relatively small countries – have also applied ANA. Ecuador negotiated a free-trade agreement with China when the US refused, and Uruguay joined the New Development Bank – dubbed the “BRICS bank” – headquartered in Shanghai. These examples bring us to the crux of ANA: seizing the opportunities created by great-power competition, on a case-by-case basis, rather than picking a side.
BY THE WAY . . .
PS: At a time when the US is “weaponizing the dollar” for geopolitical objectives, you make the case for “monetary pluralism.” In The Non-Aligned World: Striking Out in an Era of Great Power Competition, you and your co-authors, Carlos Fortin and Carlos Ominami, advocate “crafting a more diversified system,” in which “the currencies of other relevant economies also play a role.” What might such a system look like, in terms of its composition and governance?
JH: The US dollar’s unquestioned dominance was built into the post-World War II international financial architecture. But as America’s global economic role has declined – the US now represents less than 15% of world trade – this dominance has become incongruous with reality. With the Trump administration embracing protectionism and weaponizing the dollar, and with the divide between the US and Europe on trade and investment policy widening, the dollar-based system has become downright dysfunctional.
That is why I call for a more balanced and pluralistic system, in which other currencies – particularly the euro and the renminbi – play a more significant role, both as means of payment and in countries’ foreign-exchange reserves. If Europe and China set their minds to it, a system that reflects twenty-first-century realities can be established.
PS: You point out that today’s active non-alignment relies on “smaller but more effective bodies” like the BRICS, rather than large, unwieldy institutions like the United Nations. Can such bodies really replace broad-based multilateralism in advancing the fight against climate change, and how might they bolster progress in this area?
JH: We argue that ANA is suited to countries from the Global South, as they contend with the dilemmas posed by great-power competition in today’s world. But China and Russia – leading members of the BRICS – are themselves great powers, not part of the Global South. While the BRICS grouping cannot be said to represent only the Global South, however, there is little doubt that it considers and advances developing economies’ interests to a far greater extent than, say, the G7. Simply put, while the BRICS are not of the Global South, they are for it.
Informal groups like the BRICS cannot replace broad-based multilateralism or the entities, like the UN, that embody it. Instead, they are part of what the political scientist Andrew F. Cooper has referred to as “the concertation impulse in world politics,” in which less-structured entities (the G20 is another example) facilitate collective action where more rigid ones (like the UN) cannot. Whether these groups will be able to channel that energy into the fight against climate change – especially now that the US has once again abandoned the Paris climate agreement – remains to be seen.
PS: At a time when the transatlantic relationship is fracturing, Europe is rethinking its approaches to trade, diplomacy, energy, and security. How should countries that refuse to choose between the US and China respond to this process?
JH: Much like ANA, the concept of European “strategic autonomy” gained considerable traction during the first Trump administration, with French President Emmanuel Macron and Josep Borrell, the EU’s High Representative for Foreign Affairs and Security Policy, emerging as key proponents. Since Trump’s return to the White House – which is fracturing the transatlantic alliance and raising questions about the very idea of the “West” – even countries that initially treated the concept’s resurgence with some skepticism, such as such as Germany and the United Kingdom, have embraced it. Germany’s incoming chancellor, Friedrich Merz, is already preparing decisive moves to advance this vision.
Strategic autonomy gives Europe more leeway to pursue a kind of ANA of its own. Already, Europe has recognized that mimicking America’s knee-jerk anti-China stance is inappropriate if the continent can no longer count on the US security guarantee. For developing economies, this opens new avenues for collaboration with Europe, without the kinds of broad “allegiances” that were demanded in the past.
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