America Needs to Leverage its Power to Stabilize Latin America and Stop Chinese Influence in the Region

September 5, 2023

CNSI Blog

In the aftermath of 9/11, the Department of Homeland Security (DHS) could count on and leverage the primacy of U.S. global leadership and economic influence to address a range of foreign threats to the U.S. homeland. Two decades later, our economic, trading, and monetary systems are being weaponized against us by foreign adversaries and competitors, and in the process, escalating the erosion of democratic rules and norms. The traditional terrorist threats persist, but now we face additional and fundamentally different sets of threats to the homeland that require new strategies and tactics — threats that are attacking not only our physical borders but our financial, digital, and trade borders as well.

Since 2008, Latin America has seen a greater decline of democratic indicators than any other region globally. Authoritarian regimes are driving migration to the southern border in tremendous numbers, with migrants from Cuba, Venezuela, and Nicaragua now outnumbering migrants from the “Northern Triangle” countries of Honduras, El Salvador, and Guatemala.

Latin America has become increasingly vulnerable to authoritarian encroachment. Instead of being filled with democratic friends and booming economies, America's backyard is home to Russian bombers and mercenaries. Also finding a place there: 29 Chinese-owned ports and port projects, widespread anti-U.S. propaganda fueled by Iran and Russia, Chinese-enabled fentanyl and money laundering operations, wobbling and fallen democracies, and widespread economic and political instability.

The challenge of authoritarian influence in Latin America presents critical questions about how the U.S. can use its economic and political power to promote stability, opportunity, investment, and democratic principles in the region.

The Biden administration should undertake several concrete actions to address these significant challenges:

1. Identify and analyze a broader range of economic security threats as core drivers of homeland security vulnerability. We need to continue to shift the intelligence and analysis framework to encompass a wider range of actors, threats, and data sources.

2. Re-engage and expand private sector supply chain partnerships to improve information and data that support better intelligence gathering and analysis. We need more and deeper partnerships with the private sector, especially those involved in manufacturing, transporting, importing, exporting, and investing in commercial operations throughout Latin America.

3. DHS should conduct a detailed review of China's multilayered influence on ports and trade infrastructure in the region. The department should lead or co-lead a comprehensive review of vulnerabilities of Latin American ports, including mapping Chinese ownership and links to the sanctioned entities; the implementation of Chinese-made technology; an assessment of 5G wireless network access and ownership; understanding China's operations and maintenance strategies at ports; assessing the risk of potential dual-use infrastructure; and investigating illicit actors and entities associated with critical infrastructure.

4. Expand the effectiveness of trade transparency units, which were established in 2004, to exchange trade data between the U.S. and trading partners. We should take steps to better understand the risks of trade-based money laundering.

5. Increase investigative work to uncover Chinese money laundering networks and financial institutions supporting them.

6. Support legislation like the Foreign Extortion Prevention Act, which would expand anti-corruption enforcement tools and build on the Foreign Corrupt Practices Act.

7. Adopt a broader strategy to “ally-shore” with regional partners on new supply chains, emerging technologies, and other opportunities to drive higher levels of U.S. and Western investment.

These concrete steps, along with an evolution of mindset and operational readiness from the administration, would help pivot DHS towards addressing authoritarian influence in Latin America. Moreover, the region would benefit from long-term commitment to mutual security and greater economic engagement, as well as more purposeful collaboration with allies and partners. While Mexico has frequently benefited from U.S. efforts to locate supply chains closer, the Biden administration could take steps to extend some of these efforts to other allies in the region.

A prosperous, democratic Latin America reduces the need for humanitarian migration to the United States, offers critical supply chain advantages, and provides additional resources and human talent to catalyze 21st century technologies. “Ally-shoring” shifts of U.S. manufacturing from Asia to Latin America could promote prosperity throughout the region, lower costs for American businesses, and reduce pressures contributing to political instability and mass migration.

This post drew from testimony given by Elaine K. Dezenski on June 21, 2023, during a House Homeland Security Subcommittee on Counterterrorism, Law Enforcement, and Intelligence hearing titled “Countering Threats Posed by Nation-State Actors in Latin America to U.S. Homeland Security.”