Welcome again to Overseas Coverage’s Latin America Transient.
The highlights this week: Brazil readies to host the BRICS leaders’ summit, Bolivia embraces cryptocurrency amid an financial disaster, and Mercosur notches a new commerce deal.
The BRICS leaders’ summit begins this weekend in Rio de Janeiro. The group of rising economies has grow to be more and more related in world politics in recent times. However it’s additionally extra unruly than ever.
BRICS expanded from 5 to 9 members in 2024 and added Indonesia this yr. (The acronym stands for standard-bearers Brazil, Russia, India, China, and South Africa.) Along with the 10-member roster, Saudi Arabia commonly attends BRICS conferences; the dominion has not but accepted its formal membership invitation. Ten different nations have official “associate nation” standing. A handful extra are attending the Brazil summit as company, together with Mexico.
The enlargement is partially responsible for rising discord throughout the bloc. At an April BRICS international ministers’ summit, Egypt and Ethiopia blocked a declaration backing South Africa’s ambitions for a everlasting seat on the United Nations Safety Council.
However political disagreements haven’t watered down the group’s relevance. Quite the opposite: Many nations have sought out BRICS affiliations as a way of diversifying their commerce and political relationships amid unpredictability from U.S. President Donald Trump.
Officers the world over are asking themselves: “Exterior of the USA, what can we do for the medium to lengthy haul?” mentioned Sarang Shidore, the director of the Quincy Institute’s World South program. At a time when “the temper in Washington is hostile to commerce,” he added, BRICS is “the closest factor we’ve to a multilateral node for a substitute for the place the superpower goes.”
The United Arab Emirates is among the bloc’s new members. “BRICS brings collectively giant and fast-growing shopper markets throughout Asia, Africa, and Latin America,” senior Emirati international affairs official Ahmed Ali Al Sayegh wrote in a press release to Overseas Coverage. He added that membership gave the nation “much more diversified entry to vital economies.”
Brazil’s yearlong BRICS presidency is an opportunity for the nation to place its stamp on the group. Whereas BRICS has typically drawn Western ire for its stances on wars in Gaza, Iran, and Ukraine, Brasília’s summit agenda is concentrated on financial improvement, particularly local weather finance.
Brazil’s objectives embody establishing new mortgage ensures from BRICS’s improvement financial institution, the Shanghai-based New Growth Financial institution, finance ministry official Tatiana Rosito informed Folha de S. Paulo. The New Growth Financial institution focuses on infrastructure, sustainability, and native forex operations.
Brazil may even attempt to iron out local weather coverage variations between its members forward of November’s COP30 U.N. local weather convention within the Amazonian metropolis of Belém, Rosito added. At a U.N. biodiversity summit earlier this yr, BRICS nations submitted a joint proposal that served as the premise for the ultimate summit determination on international funding of nature safety.
Whereas BRICS doesn’t formally negotiate as a bloc in U.N. local weather summits, “we want to construct convergence,” Rosito mentioned. Russia has been a constant opponent of language about shifting away from fossil fuels.
Progress on financial and local weather cooperation would assist an argument that Brazil and India have lengthy made to BRICS detractors: The bloc will not be about opposing the West, however moderately supporting growing nations. (China and Russia are extra snug with an overtly anti-Western tilt.)
Whether or not Brazil succeeds at shaping BRICS’s agenda can be exhausting to evaluate in a single summit. A lot of the group’s worth lies within the face-to-face time it permits senior officers from totally different nations. BRICS occasions are “a spot the place concepts may be examined and mentioned,” Shidore informed Overseas Coverage. Parallel private-sector occasions might additionally result in new enterprise connections.
If the group elevated its focus, it might obtain extra than simply speaking. Shidore has identified that one among BRICS’ most concrete achievements—the New Growth Financial institution—has grown way more slowly than the same lender based across the identical time, the Asian Infrastructure Funding Financial institution. The previous introduced plans to lend solely round $5 billion in 2024, whereas the latter lent over $8 billion.
Like BRICS itself, the New Growth Financial institution has attracted new members in current months, with Colombia, Uzbekistan, and Indonesia within the technique of becoming a member of. Uzbekistan is a BRICS associate nation, whereas Colombia will not be an official BRICS member or associate state.
These nations have up to now sought out lenders such because the World Financial institution or Worldwide Financial Fund. However the USA is the most important shareholder in each, and the Trump administration has signaled it would flex its affect to veto some lending.
Friday, July 4, to Saturday, July 5: Indian Prime Minister Narendra Modi visits Argentina.
Saturday, July 5: U.S. Momentary Protected Standing expires for beneficiaries from Nicaragua and Honduras.
Sunday, July 6, to Monday, July 7: Brazil hosts the BRICS leaders’ summit.
Mercosur’s latest commerce deal. Following the conclusion of commerce talks with the European Union final December, Mercosur on Wednesday introduced that it had wrapped up one other European commerce deal. This one is with the European Free Commerce Affiliation (EFTA), a bunch of 4 non-EU nations: Iceland, Liechtenstein, Norway, and Switzerland.
Just like the EU deal, the EFTA settlement had been within the works for years. Leaders prioritized it within the wake of Trump’s protectionism, and it nonetheless faces inner approval in EFTA and Mercosur member nations. However the EFTA deal doesn’t seem to face the identical degree of resistance from European agriculture sectors that has difficult the EU deal.
Whereas French farmers might but block the EU settlement, Switzerland’s financial affairs secretary mentioned at a press convention in Buenos Aires that the Mercosur deal is “a whole precedence for the EFTA nations.” It might take away commerce boundaries to greater than 97 p.c of exports, based on a joint EFTA-Mercosur assertion.
Individuals line as much as purchase rooster in La Paz, Bolivia, on June 11.Aizar Raldes/AFP through Getty Photos
Bitcoin in Bolivia. El Salvador is named the Western Hemisphere’s largest cryptocurrency advocate. However one other nation within the Americas has additionally just lately—and unexpectedly—come to embrace it: Bolivia.
Bolivian regulators for a few years took a conservative stance on cryptocurrency and banned it. However amid a deep financial disaster and dwindling greenback reserves, they reversed course final yr and allowed cryptocurrencies for the primary time.
In March, the state power agency mentioned it will begin utilizing cryptocurrency to pay for power imports. Final Friday, Bolivia’s central financial institution mentioned that transactions utilizing digital fee channels and digital belongings grew over 500 p.c between the primary half of 2024 and the primary half of 2025.
Whereas using cryptocurrencies might permit Bolivians to conduct some enterprise, it doesn’t tackle larger financial issues. Annual inflation within the nation stood at over 18 p.c in Might, and the native forex’s unofficial change price has fallen by round 50 p.c towards the greenback this yr alone. Amid this volatility, Bolivia is because of maintain presidential elections subsequent month.
U.S. safety technique. Two current occasions present glimpses of the Trump administration’s technique for combating organized crime in Latin America.
Ecuador and the USA have cooperated on anti-crime efforts since 2024. The US assisted Ecuadorian intelligence officers in an operation to trace fugitive drug boss José Adolfo “Fito” Macías Villamar, the Washington Put up reported; final Wednesday, he was captured. Whereas U.S. safety help typically militarizes regulation enforcement within the area, nobody was killed throughout Fito’s arrest.
In Mexico, the USA examined a special method. Additionally final Wednesday, the Treasury Division banned sure U.S. transactions with three Mexican monetary establishments—two banks and one brokerage agency—accusing them of serving to transfer cash for fentanyl smuggling. Every of the 2 banks accounts for lower than 1 p.c of Mexico’s monetary system.
The sanctions got here as a shock to the Mexican authorities. President Claudia Sheinbaum mentioned that Mexico had obtained inadequate proof in regards to the banks’ alleged wrongdoing.
Bolivia’s financial turmoil is expounded to its falling pure fuel manufacturing. When did that manufacturing peak?
The Nineties
The 2000s
The 2010s
The 2020s
Based on its state power agency, Bolivia’s pure fuel manufacturing peaked in 2014.
A Cuban arts and crafts salesman cleans a road in entrance of his enterprise embellished with a poster of former Cuban President Raúl Castro on his 94th birthday in Havana on June 3.Yamil Lage/AFP through Getty Photos
This week, Trump ordered prime officers to review the best way to tighten financial restrictions on Cuba, probably through wide-reaching secondary sanctions. Secretary of State Marco Rubio, who’s of Cuban descent, has lengthy been vocal about his need for Cubans to oust the ruling Communist authorities. However a long time of U.S. financial warfare have didn’t result in regime change.
Given the hardened nature of U.S. Cuba coverage in the present day, it’s all the extra outstanding that Washington tried a dramatically totally different method a couple of decade in the past, underneath President Barack Obama.
A new present from Overseas Coverage’s podcast crew particulars the key talks that led to a political thaw between Havana and Washington in December 2014. Produced with Audible and Skybound Leisure, the present hears immediately from lots of the protagonists who engaged within the diplomacy. Due to a long time of animosity between the 2 nations, it took signaling from Obama himself to persuade Cubans that the USA was critical about enhancing relations.
The deal included months of secret confidence-building measures, amongst them a extremely uncommon episode of “stork diplomacy,” within the phrases of FP’s Dan Ephron, the present’s host. U.S. officers facilitated a sperm switch from a Cuban spy jailed in the USA, permitting his spouse in Cuba to get pregnant. In 2015 and 2016, rapprochement introduced a swarm of latest curiosity from U.S. corporations in doing enterprise on the island.
Trump rolled again the settlement in his first time period, vowing to undo a lot of Obama’s insurance policies. Former Obama advisor Ben Rhodes informed Ephron that the Cuba-U.S. relationship snapped again to “the worst facets” of every nation’s international coverage. “We’re going to harm particular person individuals as a result of we’re mad about one thing that occurred 60 years in the past or 70 years in the past,” Rhodes mentioned.
