Originally published in Americas Program.
Dilma Rousseff interrupted the speech of Barack Obama. The President of the United States was speaking about the advances of various countries in Latin America, commenting that now there exists “a prosperous middle class” that represents a business opportunity for companies from his country. “Suddenly, they are interested in buying iPads, interested in buying planes from Boeing.” “Or Embraer,” interjected Dilma, yielding applause.
Days before the President of Brazil had been upstaged in Washington by a children’s Easter celebration, which was more publicized more than her visit to the White House. “That little photo opportunity had more visibility than the visit of the President of the sixth largest economy in the world,” complained the Brazilian press, contrasting Dilma’s reception with those of the presidents of China, Russia, and India .
What stood out most from the Summit in Cartagena were the blunders and gossip material. Shakira made mistakes in several verses of the Colombian national anthem. Twelve members of Obama’s Secret Service had to return beforehand due to a scandal with prostitutes whom the bodyguards refused to pay. “It is the worst scandal in the history of the Secret Service,” wrote the Washington Post .
The last summit?
The history of the Summit of the Americas is as brief as it is significant. The first was proposed by Bill Clinton and took place in December,1994, in Miami. The climate was dominated by the Washington Consensus, in which the region dutifully followed White House principles, which used the platform to launch the FTAA (Free Trade Area of the Americas).
The derailing came with the fourth summit in Mar del Plata, Argentina, in November of 2005, when the United States couldn’t impose the FTAA due the refusal of Mercosur and Venezuela. The fifth summit, which took place in Trinidad and Tobago in 2009, was merely procedural since the presidency of Obama had just only begun.
The sixth summit was something else. First, the region is not divided—it is united. It is united against the discrimination against Cuba, against the drug war, and in favor the decolonization of the Malivinas Islands. Second, the region showed that it is now mature enough to walk on its own, without the “interference” of the United States and Canada. Third, the United States is isolated and very few countries continue to follow it: only Mexico and Chile, but each with very low profiles.
The absences of Rafael Correa, Hugo Chavez, and Daniel Ortega made less noise than the early exits of Cristina Fernandez and Evo Morales. But the most notorious was the departure of Dilma Rousseff who suspended her appointment with host Juan Manuel Santos for “scheduling reasons.” The Colombian President rushed to tell anyone who would listen that the summit “wasn’t a failure.”
The main change that explains the shift is the taking-off of the Community of Latin American and Caribbean States (CELAC by its Spanish initials) formed in February of 2010. The creation of this organization, one without the United States and Canada, which had been in the works for a time, began to take shape months after the notable failure of the Organization of American States in resolving the crisis provoked by the coup d’état in Honduras in June of 2009.
The Declaration of Cancun, signed upon the creation of CELAC, pointed to the necessity of “deepening the political, economic, social and cultural integration of our region,” defending “multilateralism,” promoting regional integration and the creation of a new financial architecture, including the possibility of making payments in national currencies and evaluating the creation of a common currency.
A report from Reuters emphasized that the President of the United States “left the summit alone” highlighting “the continual decrease of Washington’s influence in a region that has become less dependent on commerce and investments from the United States, thanks to rates of economic growth that are the envy of the developing world and new opportunities from their relations with China .”
The report mentions the crisis of the OAS, now that it is seen as an instrument of United States Cold War policy and maintains that the countries of the region are pushing for “a rebellion against the United States.” What’s more, the report maintains that the summit in Cartagena represented “a diplomatic victory for Havana.”
And it’s not only the exclusion of Havana that is unsustainable. The War on Drugs, which has been Washington’s key policy in the region since the fall of the Berlin Wall, is being questioned by almost every single country. Obama was forced to contest Guatemalan President Otto Perez Molina’s proposal for decriminalizing drug consumption, regulating their production and sale, and hardening the penalties for traffickers .
A recent study by the International Institute of Strategic Studies based in London maintains that the War on Drugs has a “threat for international security” that should force us to search for new alternatives .
Their paper titled “Drugs, Insecurity, and Failed States: The Problems of Prohibition,” examines the policies centered on the prohibition of drugs during the last four decades and concludes that they have not impeded the production, the trafficking, or the consumption of drugs, but that they have caused an increase in violence and instability in the world.
“Prohibition has failed to reduce the global consumption of drugs and has incidentally gifted a billion dollar business to organized crime syndicates” said Nigel Inkster, director of Transnational Threats and Political Risks of the prestigious Center for British Studies and coauthor of the study along with researcher Virginia Comolli .
The pressure against drug trafficking shifted the areas of production and led the traffickers to look for new routes that had been previously unexplored, causing areas of instability to steadily increase. That is the reason why an “urgent global debate” to study all of the possible alternatives to the current prohibition regime, including legalization and decriminalization, is being solicited.
Greg Grandin, Professor of Latin American History at New York University, said that “the principal pillars of American foreign policy (promoting neoliberalism and increasing militarization through drug policy) are still standing, and have created a crisis in the corridor that runs from Colombia, passes through Central America, and stretches up to Mexico .”
Even though many recognize that the antidrug policy has been a disaster— even President Santos of Colombia is asking for changes— Obama insisted in rejecting the legalization policy that the other countries suggested. When Dilma asked for “relations among equals” recalling that “in the past, asymmetrical relationships between the North and the South have been responsible for very negative processes,” she was interpreting the feelings of the majority of the presidents .
Without an alternative policy and having lost the role as Latin America’s most important market, the United States has to think about how the CELAC has begun to substitute the OAS as a forum to debate and resolve the problems of the region.
The petroleum issue
According the British daily, The Guardian, Americans seem to be “prisoners of another era” in their relations with the region and the world . Obama should listen to voices in his own country, like the director of WOLA (Washington Office on Latin America), Geoff Thale, who claimed that “this Summit was a reminder, a call to attention, that the traditional way of doing business vis-à-vis the region is eroding away.” This had been the preferred strategy of George W. Bush in the face of the failure of the FTAA.
After Cartagena, Secretary of State Hillary Clinton embarked to Brasilia— where she wasn’t able to have a private meeting with Dilma— and met with Graça Foster, President of Petrobas. Clinton expressed that the hydrocarbon sector was her principal interest in relations with Brazil, since the United States is seeking to increase their participation in the exploitation of offshore oil.
“I’m delighted to meet with the President of Petrobas to discuss the fabulous future that Brazil has thanks to their oil reserves,” said Clinton while pointing out her “great interest” in establishing a free trade agreement with Brazil.
Perhaps because of that interest Clinton avoided to declare her position on the nationalization of 51% of YPF by the government of Cristina Fernandez, to the distaste of Mariano Rajoy. Here lies an action taken at the intersection of two developments.
The first is the discovery of enormous shale gas reserves in Vaca Muerta (located in the Argentine Patagonia) which amounts to the equivalent of more than 22 billion barrels of oil. This makes Argentina the country with the third highest amount of non-conventional hydrocarbons.
The second is that there will not be a shortage of emerging countries that want to participate in the exploitation of those areas; for example, Petrobas, the Russian oil company Gazprom, and above all, Chinese companies. Third, according to the Financial Times, the second Chinese oil company, Sinopec, was interested in buying Repsol’s YPF share for $15 billion.
But the main sign of real geopolitical shifting is in those who can invest, and, therefore, flex political muscle in the region. China just reported that in the first three months of 2012, their direct foreign investment grew a mind-boggling 94.5% from 2011.
The Asian Giant now has strong oil investments in Brazil, where Sinopec purchased 40% of Repsol in 2012 and 30% of Petrogal in 2012, where there are now $15 billion invested by the Chinese in petroleum. Further, China has countless oil investments in Venezuela which is reorienting its exports from the United States to China.
A power in trouble
Nobody really knows the path that the White House is going to take in its relations with Latin America. What was discovered in the Sixth Summit of the Americas is that it no longer exercises a leadership role in the region. Not even its closest allies, like Colombia, share its drug war policy anymore.
And really, President Santos defended the inclusion of Cuba in the Summit of the Americas as much as he advocated for a new discussion about the War on Drugs when he inaugurated the summit.
We should remember that the War on Drugs came to substitute communism as the main enemy to fight. But when this policy has failed, there aren’t any new enemies that justify achieving consensus in the region.
To make matters worse for the US, the overlying perception is that the United States promotes militarization, while the emerging power, Brazil, practices a kind of “very sophisticated” diplomacy, according to Professor Riordan Roett of Johns Hopkins University and author of “The New Brazil.” In contrast to other emerging countries, “Brazil doesn’t have a single border conflict,” which allows an ascension without much opposition.
In the coming years things can get even worse for the declining power. In the opinion of the European Laboratory for Political Anticipation, a think tank close to François Hollande, his election as president will accelerate the geopolitical transitions that we have seen since 2008.
This analysis holds that the five years of Nikolas Sarkozy’s administration were characterized by “a subordination without recent precedent in the country’s history to the dominant power of the United States.” It goes further: it assures that the only period in which there was a similar abandonment of national sovereignty was during the Vichy Regime when France was controlled by Nazi Germany.
With the triumph of Hollande, two facts will come to pass that will have a serious repercussion on Latin America: France’s adoption of a policy of European independence as a “strategic priority” and its warming up to emerging countries in order to establish a Europe-BRICS alliance.
This alliance is advancing rapidly. Brazil and China have an important agreement of space cooperation. India and Brazil are forming a strategic alliance in their defense industries for the cooperation in the production of combat planes and submarines. France has strategic agreements with India and Brazil to lease technology that both need for their military industries.