A Canadian strategy for Latin America and the Caribbean  

Students from the University of British Columbia’s Master of Public Policy and Global Affairs program argue that Ottawa should re-prioritize its relations with the region

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Between September 2022 and April 2023, University of British Columbia’s Master of Public Policy and Global Affairs students Bianca Batacan, Genevieve Varelas, Jose Villagra, and Gustavo Villela conducted a review of Canada’s relations with Latin America and the Caribbean (LAC) region in order to determine what steps Canada should take to improve its political and economic engagement there.

The review included an examination of the existing literature about Canada’s relations with LAC countries including news articles, official statements, policy reports, and voting records at the United Nations and the Organization of American States. They also interviewed subject matter experts in Canada who shared their views on Canada’s relations with the LAC region and future opportunities for engagement.

The interviews were supplemented by fieldwork in Washington, DC, where a variety of actors were consulted including think tanks, universities, non-governmental organizations, and government agencies to hear their perspectives regarding the current challenges facing the LAC region.

For the UBC team, it was clear that Canada has developed very good relations with the LAC region over many decades. Canada and Mexico, for example, were the only two countries in the hemisphere that did not break-off diplomatic relations with Cuba, following the Cuban revolution in 1959, much to the annoyance of the United States. When Pierre Trudeau, who was also fluent in Spanish, became Prime Minister in 1968, Canada joined the Inter-American Development Bank. Prime Minister Brian Mulroney continued the work of Trudeau in strengthening Canadian-LAC relations with Canada joining the OAS in January 1990, after spending 28 years as an observer.  His efforts endured under the leadership of Prime Minister Jean Chretien, including Canada hosting the third Summit of the Americas in Quebec City in April 2001. 

On the other hand, the Paul Martin government’s 2005 International Policy Statement only mentioned Latin America once and the Caribbean not at all.  And while the Harper government attempted to boost trade ties, relations were in stark contrast from the priority Canada once had toward the LAC region. Indeed, in the wake of 9/11, Washington’s gaze shifted away from the LAC region and toward Asia and the Middle East, with Ottawa following suit. One result of this inattention was an often unchecked and growing Russian and Chinese presence in the LAC region.

Certainly, Russia is no stranger to Latin America. Throughout the Cold War, its predecessor the USSR, assisted leftist regimes in the region with financial, military, and diplomatic support. However, as the Cold War ended, Russia pulled away and focused on its own domestic issues. Since Vladimir Putin came into power however, Russia has expanded its presence in the region. Diplomatically, Russia has built strong ties with Venezuela, Cuba, and Nicaragua by overlooking and at times defending their human rights violations. In return, these countries have shown support for Russia’s actions globally. Indeed, Russia has effectively created a legitimacy feedback loop, where these nations can lean on each other for diplomatic and political support. In democracies such as Brazil, Putin has successfully courted both the Brazilian left and right by appealing to Brazil’s hubristic sense of regional importance.

Unlike China and the United States, Russia cannot leverage economic trade to increase its influence in the LAC region. Instead, it has used state-owned energy companies like Rosneft to engage in extraction projects like the $20-30 billion 25-year plan to explore oil reserves on the Orinoco River area with Venezuela. Investments in energy projects like oil extraction ensures that Russia has a greater share of regional oil reserves thereby thwarting its competitors.

Russian military assistance and training in the LAC region is also extensive. Venezuela alone has purchased $11.4 billion USD in military goods from Russia since 2006. Since then, Russia has also sent nuclear capable bombers, warships for joint exercises, Russian troops, and Wagner PMC advisors to Venezuela on numerous occasions.  Nicaragua has also purchased Russian military equipment, allowed Russia to construct a base, and authorized Russian troops to operate within the country. There is also ample evidence to suggest that Russia might deploy troops to Cuba, though these plans predate the 2022 Russian invasion of Ukraine.

In the LAC region, Russia has also seen the value in spreading disinformation, which is generally pro-Russian, anti-Western in nature. Since 2009, Russian state media RT Español has been operating with over 200 employees located  in Caracas, Havana, and Buenos Aires. So successful has RT been at penetrating the Latin American market that it has more followers and daily viewers than CNN, the BBC and DW.

China, on the other hand, has made its inroads via trade. In 2010, Chinese trade with the LAC region was only valued at $180 billion USD, but by 2021 trade had grown to $450 billion USD often creating economic dependence on China for some LAC countries. Chile, for example sent 39% of its total exports to China in 2022.

Direct investment is another mechanism by which China has increased its presence and influence. In 2020, Chinese overseas foreign direct investment amounted to $17 billion USD, and state-owned Chinese banks have loaned over $137 billion USD to LAC governments. As a result, China owns half of Chile’s power grid, copper mines in Peru, gold mines in Argentina and large agricultural operations in Brazil. The loans to LAC countries and partial and even complete ownership of infrastructure projects by China, has created a dependency on Beijing for basic functions. The result is that China is in an increasingly favourable position to potentially manipulate LAC countries into accepting trade treaties that might not be to their advantage, or having them vote along Chinese lines in international bodies such as the United Nations.

There is no question that the political and economic space in the LAC region has become more congested with Russia’s and China’s growing presence, Venezuela’s on-going troubles and the near collapse of Haiti.  All good reasons as to why Canada should develop a Latin America and Caribbean strategy along the lines of its new Indo-Pacific strategy to protect and enhance its national interests.  Indeed, the Indo-Pacific Strategy was designed to “advance and defend Canada’s interests by supporting a more secure, prosperous, inclusive, and sustainable region while protecting Canada’s national and economic security at home and abroad.” Moreover, the approach was built around “supporting democracy, the rule of law, economic growth and resilience, peace and security, human rights, sustainable development, gender equality, and concrete action to protect the environment.”

A new Canadian LAC strategy, much like the new Indo-Pacific Strategy then, would be built on Canada’s historical record of engagement and its still significant presence in the region. For instance, Canada and the LAC region have an extensive web of trade and economies ties. Canada has free trade agreements with Chile, Colombia, Costa Rica, Honduras, Mexico, Panama, and Peru. In addition, Canada has Foreign Investment Promotion and Protection Agreements with Argentina, Barbados, Costa Rica, Panama, Peru, Trinidad and Tobago, Uruguay and Venezuela as well as 30 air transport agreements in the region.  Furthermore, Canada’s bilateral merchandise trade with the LAC region totalled $29.5 billion CDN in 2021, while two‑way trade in services totalled $15.4 billion CDN in 2020. What Canada lacks, however, is a coherent strategy for its regional relations, creating a sense that engagement efforts are perhaps haphazard and short-term.

Creating a regional strategy akin to Canada’s Indo-Pacific Strategy is a policy option worth considering if Canada is seen to be serious about deepening engagement with the LAC region.  It would also signal a strong willingness on Canada’s part to pursue long-term relations with the region in an era of increasing geopolitical, great-power competition, and global instability. A new regional strategy would also help build trust between Canada and the LAC region, demonstrating a coherence of vision and intent to invest resources, which would be well received by Latin American and Caribbean leaders and their publics.

The creation of a LAC regional strategy would likely not require the same expenditures as the new Indo-Pacific Strategy. In terms of economy, number of states, and population, Latin America does not compare to the Indo-Pacific region.  Nevertheless, like the Indo-Pacific Strategy, Canada would seriously need to look at expanding market access, increasing its visa-processing capacity and education exchange opportunities, support the LAC region as it transitions to a low-carbon footprint and clean energy and enhance its military-to-military ties just to name a few examples.

One potential area for deeper cooperation between Canada and Mexico is gender equality. Both Canada and Mexico have an official feminist foreign policy. Their commitment to promoting and protecting gender equality and women and girls’ empowerments was reaffirmed as part of the Canada-Mexico Action Plan during the 2023 North American Leaders Summit.  This is an area that should be mutually translated into actionable, regional initiatives that advance gender equality and women and girls’ empowerment.

Canada’s strong and growing Latin American diaspora is another factor that should also prompt the Canadian government to develop a LAC regional strategy. In the 2021 Census, 580,000 people reported being Latin American, the vast majority coming from South America (40.7%) or Central America (31.9%) followed by the Caribbean and Bermuda (4.2%).  And the path to a new strategy should be supported, much like the Indo-Pacific Advisory Committee, by a similar committee of experts representing the private sector, civil society, and government to ensure that a renewed Canadian approach to the LAC region also reflects the many perspectives of Canadians from across the country. 

In sum, and in-light of changing geopolitical developments, Canada’s national interests in the LAC region, the team concluded, would be better served by a new Latin America and Caribbean strategy.

Photo credit – Pixabay / Cristian Cortez