A Hesitant Hemisphere: How Latin America Has Been Shaped by the War in Ukraine
Listen to the 35 West Podcast episode: One Year Later, Latin America Continues to Hedge its Bets on Ukraine
The principle of nonintervention in the affairs of another country has deep roots in Latin America. Born out of U.S. intervention in the region in the late nineteenth and early twentieth centuries and solidified during the Cold War, the principle remains potent today and is evident in the region’s reaction to Russia’s war of aggression against Ukraine.
Latin America’s uncomfortable stance toward the invasion of Ukraine came into focus as Argentina’s president Alberto Fernandez, and then-Brazilian president Jair Bolsonaro, made the unfortunate decision to meet with Vladimir Putin just days before Russian forces surged across the Ukrainian border. Since then, Brazil has voted against Russia in several UN resolutions, but has stayed clear of condemning the invasion, even after the drastic government change from Jair Bolsonaro to Luiz Inácio Lula da Silva (Lula). Argentina has also voted against Russia in several UN resolutions, and in a January meeting with German chancellor Olaf Scholz, President Fernandez reiterated his support for Ukraine and condemned the Russian invasion. The usual suspects—Cuba, Nicaragua, and Venezuela—have stood by Russia, both rhetorically and in continued economic relations, but along with Bolivia and El Salvador, they did not outright reject UN Resolution, Aggression against Ukraine, and instead chose to abstain or remain absent. Latin America’s lukewarm position on the invasion of Ukraine was also evidenced by the region’s reluctance to send any type of warfare material to Ukraine. Argentina, Chile, and Brazil rejected the call for support, while Mexico’s president Andrés Manuel López Obrador (AMLO) criticized Germany for agreeing to send tanks to Ukraine. Even the United States’ closest ally in the region, Colombia, refused, with President Petro saying that he would not send weapons to Ukraine, and would rather have them end up as scrap.
As the region desperately seeks to remain neutral, Russia will continue to chip away at the United States’ sphere of influence in Latin America, and the Ukrainian people will suffer the consequences. Latin America has a tough choice to make—their economies are struggling and taking sides could have important implications for their economic recovery. Still, this is a matter of supporting basic human rights, which leaves little room for ambiguity.
Trading One Dictator for Another
Soaring oil prices and a desire to find alternatives to Russian sources of oil led to a very dramatic change in the U.S. posture toward Venezuela, one which can only be described as realpolitik. Only two weeks after Russia’s invasion of Ukraine, senior U.S. officials traveled to Caracas and met with President Nicolas Maduro to explore ways to increase Venezuelan oil production (by easing sanctions) and seek the release of several U.S. citizens held captive by the Maduro regime. This was the first time in years that high-level U.S. officials met with President Maduro. The officials did not meet with Juan Guaidó, the president of the opposition-formed interim government, nor did opposition figures apparently have advance warning of the trip. This had an immediate domestic and international impact: strengthening Maduro’s hand and weaking Guaidó’s.
The visit marked a shift in U.S. strategy on Venezuela. Whereas previously the Trump administration had pursued a policy of “maximum pressure,” imposing individual sanctions against regime officials as well as on Venezuela’s oil sector with the hope that the regime would collapse, the Biden administration’s strategy now consists of encouraging negotiations between the regime and the opposition in order to find a sustainable path toward restoring democracy in the country.
The Maduro regime did release some U.S. prisoners and suggested it would resume negotiations in Mexico with the opposition. Three months after the visit to Caracas, the United States gave two energy companies permission to resume shipments of Venezuelan oil to Europe and in November 2022, Chevron was allowed to resume operations and exports to the United States after a four-year stoppage. However, the impact on global oil supplies and on prices has been negligible, given the deplorable state of the industry in Venezuela which only managed to produce 578,000 barrels per day (b/d) of crude in March 2021, from a peak in the late 1990s of 3.4 million b/d. In addition, important changes in the leadership of key governments in Latin America, and a continuously fractured opposition remain powerful disincentives for Maduro to engage in any genuine dialogue with the opposition.
Russia’s invasion of Ukraine changed the calculus regarding the importance of Venezuelan oil and led directly to a major change of strategy in relation to the Maduro regime. The Biden administration essentially began negotiating with one dictator in order to stop another, a policy which is unlikely to pay any further dividends.
Economies under Pressure
As a result of Russia’s invasion of Ukraine, the International Monetary Fund and other financial institutions have adjusted their growth projections downward for the region. This comes on top of the devastation wrought by the Covid-19 pandemic—still not fully recovered to pre-pandemic levels—and threatens to stymie political efforts to address voter frustrations with disparate experiences and outcomes during the pandemic, as well as highly unequal distributions of wealth. Additionally, Latin America and the Caribbean have suffered an uptick in food insecurity. Agriculture commodities, in particular, continue their wild gyrations in the market. One of the largest factors driving cost increases remains Russia’s dominance of trade in nitrates for fertilizers. Large agricultural powerhouses, such as Brazil and Argentina, paid a steep price for finding a workaround to Russia’s dominance of fertilizer inputs.
At the time of Russia’s invasion in February 2022, the economy of Latin America was already confronting a slow and painful recovery from the Covid-19 pandemic. As one of the regions hit the heaviest by the pandemic, the expected growth rate in GDP for the region in 2020 was estimated to shrink by 4.6 percent and grow by just 2.6 percent for 2021 and 2022. Then the war in Ukraine broke out. At the outset of the war, headline inflation, which includes the increases in food and energy prices, rose from 8.4 percent to 10.2 percent in the top five largest economies in the region. While inflation dropped toward the end of 2022, the prospects of ample economic growth in 2023 are bleak. Nonetheless, despite many setbacks, the region defied expectations and, by the end of 2022, its total GDP growth reached 3.9 percent. As the war broke out, the world looked to countries like Argentina and Brazil to ramp up their wheat production in order to fill the void left by Russian and Ukrainian wheat, which covered around 30 percent of global supply prewar.
Prior to the start of the war, Russia-Latin America trade was limited, accounting for a mere 0.64 percent of Latin America’s total trade. Paraguay had the highest percentage of its exports going to Russia, Ukraine, and Belarus, at 5.6 percent, while Brazil had the highest percentage of imports from these countries at only 1.8 percent. As the war progressed, U.S.-imposed sanctions on Russian energy and refined petroleum products accelerated Moscow’s interest in the Latin American market. At the height of the energy crisis in the summer of 2022, Brazil ramped up imports of Russian diesel by 15 percent, which helped President Bolsonaro lower energy prices and boost his popularity. While Cuba and Venezuela continued to import petroleum derivatives from Russia, Ecuador recently changed its policy to halt Petroecuador from accepting any further shipments of Russian diesel in an effort to comply with sanctions. Latin America’s oil-rich countries, such as Mexico, Venezuela, and Brazil, are all facing unprecedented obstacles to ramp up production due to subpar infrastructure and hostile domestic policies that are not conducive for economic growth. In 2022, data showed 14.28 million barrels of Russian refined product coming into Latin America compared to the 4.56 million into the United States, mostly before sanctions in March. It is estimated that in January of this year, 1.43 million barrels of clean product have already arrived from Russia to the region. By refusing to outright condemn Russia’s aggression toward Ukraine, Latin American countries have left the door open for collaboration with Russia on trade as their own efforts to keep inflation under control collapse.
With poverty at its highest levels in decades and little prospects for robust economic growth, tensions will continue to rise throughout the region. Peru experienced high levels of instability as a result of a failed “autogolpe,” in December 2022, and a couple of weeks later Brazilian rioters stormed federal buildings. The war in Ukraine has disproportionately affected Latin America’s most vulnerable populations, which creates a situation in which extra-hemispheric actors can exert undue influence in the region. In order for Latin American countries to drive economic recovery from global shocks, the region will likely need to invest in infrastructure, education, innovation and social programs. A natural partner in the absence of U.S. investment in the region is China. China’s efforts to not only expand its influence in the hemisphere, but also to solidify its economic and military presence in the region will only accelerate and is a concern especially vis a vis the China-Russia nexus. The one-year mark of the war in Ukraine should be a sobering reminder of the imperative to defend democracy and create a prosperous environment for all.
The Year to Come
Just as it is important to understand what the war in Ukraine means for Latin America, is it also essential to unpack how Latin America may influence the political, military, and diplomatic conditions for Ukraine. Current signs do not appear promising. The refusal of all three major non-NATO allies in the region to consider providing military equipment to Ukraine indicates both a setback for U.S. diplomacy and efforts to bring the region into its coalition of Ukraine supporters, but also materially impacts Ukraine’s ability to continue fighting. Latin America is home to several countries that operate legacy Russian weapons systems, including equipment such as helicopters, artillery, man portable air defenses, and anti-tank missiles, which could be put to good use in the hands of the Ukrainian armed forces. Opposition on the part of the region to supplying military equipment, limits sources of resupply and opportunities to alleviate pressure as Ukraine confronts the punishing rates of ammunition consumption, equipment losses, and the general wear and tear of high-intensity conflict.
Looking past the battlefield, a number of Latin American countries have also sought to play a peacemaking role, and in doing so veered from the position of the United States and allies. Most recently this initiative has come from Lula, who proposed a Brazilian-led effort to convene a group of like-minded nations to manage negotiations between Russia and Ukraine. Before him, Mexican president AMLO put forth his own peace plan at the UN General Assembly, which was vocally condemned by Ukrainian representatives as overly favorable to Moscow. As war weariness continues to threaten to undermine domestic support within even staunch allies of Ukraine, proposals like Brazil’s and Mexico’s may gain momentum as a possible third way, a concerning development which would likely play to the Kremlin’s advantage. Combined with Xi Jinping’s plans to cynically position China as a peacemaker, these calls for an end to hostility may find fertile ground throughout much of the Global South.
The last year has shed light on a number of uncomfortable truths about the international order, as well as the community of democracies that share the values for which Ukraine is fighting. For one thing, nonalignment is exacting a higher and higher cost on countries trying to toe a careful line. On the anniversary of Russia’s war of aggression against a peaceful democratic country, the democratic states of Latin America and the Caribbean must decide whether they want to live in a world where military might makes right, civilians are targeted and killed, autocracies are ascendant, and the rules-based international order is overturned, or, whether they will live up to their democratic ideals and respect for human rights, born out of their own internal struggles with past military dictatorships. The reality that has set in over the past year is clear: the Atlantic or Pacific Oceans will not insulate Latin America and the Caribbean; neither will nonintervention. Sooner or later, what Russia stands for will wash up on their shores.
Ryan C. Berg is director of the Americas Program and head of the Future of Venezuela Initiative at the Center for Strategic and International Studies (CSIS) in Washington, D.C. Christopher Hernandez-Roy is the deputy director of the CSIS Americas Program. Juliana Rubio is the program manager with the CSIS Americas Program. Henry Ziemer is the program coordinator and research assistant with the CSIS Americas Program. Rubi Bledsoe is the program coordinator with the CSIS Americas Program.