The Return of the Rivalry: Latin America in the New Great Power Contest

Until not so long ago Latin America had been considered a quiet region, located far from the world’s superpower main strategic confrontations, with sporadic but crucial moments that helped to shape the international order as we know it today. The Cuban Missile Crisis is the clearest example: it became the starting point for a series of agreements and treaties on nuclear and strategic security, involving both the US and the Soviet Union at first, and later extending to other actors of the international community, from Europe, Asia and Latin America, which became the first region free from nuclear weapons after the signing of the Treaty of Tlatelolco in 1967, 5 years after the crisis. After this episode, the region’s relevance seemed to fade, and Latin American countries appeared condemned to a destiny of surfing between weak political cohesion internally and relatively stable economies, even as most of its governments remained closely aligned with Washington on foreign policy matters.

It was precisely during this period of perceived irrelevance that China began building its presence in the region, very gradually and over the course of a little more than two decades. Washington largely ignored this process, even as it became clear that the Asian giant was becoming the largest trading partner for several South American countries, such as Peru and Brazil, and in many cases also the main investor in their economies. This neglect was not born of ignorance: it reflected, instead, a confidence that local governments would remain compliant regardless of who was investing in them. President Trump’s first term illustrates this well. Despite isolated clashes with the governments of Mexico and Venezuela, these episodes looked minor when compared to the “tariff wars” waged against the EU and China. In fact, the only time Trump ever set foot in the region during his entire first term was in November 2018 when he attended the G20 Forum in Buenos Aires. Significantly, there was a planned short visit in Colombia after this event, but I was cancelled. This was widely read at the time as a confirmation that Latin America remained a low priority for Washington’s foreign policy agenda, more due to the expectable compliance of local governments than ignorance of the importance of the region as a resource base capable of fueling US power projection in other regions.

It was only during Trump’s second term that American foreign policy has shifted towards the Western Hemisphere, attributing strategic importance to the region and setting the objective to maintain a near-absolute dominant presence, involving both economic and military dimensions, as is stated in the latest National Security Strategy of 2025.

By the time this shift was formalized, China’s footprint in the region was already deep and country-specific. In Brazil, China had been the largest trading partner since 2009; bilateral trade hit a record $171 billion in 2025, with China accounting for 27.2% of Brazil’s total foreign trade, besides, EV plants and a still planned bi-oceanic railway linking Brazil to Peru’s Pacific coast were being negotiated as part of the Chinese investment strategy in both countries. In Argentina, China became the primary supplier of mobile network infrastructure, part of a broader Chinese push into Latin American 5G and data-center markets. And in Peru, China invested around $1.3 billion in the strategic port of Chancay, a deepwater facility that entered full operation stage in November 2024, and set a new phase for trade between China and South America, bypassing the traditional deepwater ports located in the US, like the ports of Oakland and Stockton. Reinforcing this, China pledged in May 2025, at the CELAC forum ministerial meeting in Beijing, to ramp up its regional engagement even further. These were not isolated transactions but a structural presence, one that the 2025 National Security Strategy now identifies strictly as the rival foothold it intends to dislodge.

Now, within this context in 2026 the declared shift of interests proved it wasn’t merely rhetorical. The year started with the launching of Operation Resolve, when a group of American special military forces conducted a military raid and captured President Nicolás Maduro and his wife in Caracas, transporting them to New York to face narcoterrorism charges. Trump declared that the US was now “in charge” of Venezuela until a transition takes place. This meant in practice that the US would hold control over the country’s oil exports, which during the first four months after Maduro’s capture were estimated at $8 billion, but the data on how much oil has been sold, the revenue from it and the use given to those funds remains secret. The main importers of Venezuelan oil during this period were the United States (43 percent), India (26 percent, part of the strategy to reduce Indian import of Russian oil), and Spain (8 percent). This episode, condemned by critics as a return to the old days of imperialism, set the tone for the rest of the year: a hemisphere where Washington would use military force, tariffs, and other mechanics for pressuring countries to sign economic deals where American core interests prevail.

An example of this is the new and controversial Trade and Investment agreement signed by the United States and Argentina in February of this year. According to the text, Argentina shall adapt the regulatory framework to implement US trade standards and prioritize American direct investment in the country, while the counterpart shall “try to review its tariffs” and “consider supporting investment financing”. Milei’s government has justified this as the price for ideological loyalty and continued financial support after the $20 billion credit line that helped to stabilize the local currency (peso) last year.

On the other hand, Brazil took the opposite path: rather than just seeking accommodation to this policy, the government of Lula da Silva accelerated diversification, finalizing the long-delayed EU-Mercosur agreement in January, deepening trade with China and signing a memorandum of understanding with aims for further strategic partnership with Russia. Notably, the US has implemented another mechanism of pressure here, condemning the imprisonment of former president Jair Bolsonaro and holding a meeting with his son Flavio Bolsonaro, who will participate in the presidential elections this October. This gives clear signs of indirect support for this far-right candidate, following the regional trend with Milei in Argentina and Keiko Fujimori in Peru.

Peru, meanwhile, illustrates a third pattern and an interesting case, because alignment here is imposed less by negotiation than by sheer state fragility. Amid a presidency turning over for the ninth time in a decade, the US State Department warned in February that China’s control over the Chancay megaport threatens Peru’s sovereignty, following a Peruvian court ruling that exempted the port from national oversight. Peru’s case pictures a scenario where both counterparts keep pushing for concessions and more privileges. Under the government of José María Balcázar, the ninth president in 10 years, the country has been involved in the controversial purchase of 12 F-16 jetfighters with a cost of around $3.5 billion. On April he postponed the official ceremony where this deal was supposed to be signed arguing that it would have to be the responsibility of a new president, the decision was met with pushback, both internally, with declarations from the Ministry of Defense and in the US Embassy, with ambassador Bernardo Navarro declaring “If you deal with the U.S. in bad faith and undermine U.S. interests, rest assured, I, on behalf of [President] Trump and his administration, will use every available tool to protect and promote the prosperity and security of the United States and our region.” After this, with both internal and diplomatic pressure, the deal was signed on the 17th of April.

Taken together, these cases suggest the current US approach to Latin America is not fueled by a single ideological logic, but by transactional calculations that value compliance and heavily punishes resistance, exploiting weaknesses here and there and aiming to these policy goal indifferently to whether the country in question is led by a right, left or ideologically undefined government. What seems quite clear is that the decades of quietness in Latin America have ended, not necessarily because the region has changed, many of the deep challenges for development are still present, but because the rivalry that once defined the Cuban Missile Crisis has returned, this time fought over trade tariffs, infrastructure and technology access rather than missiles.