The bi-national Colombian-Venezuelan guerrilla character provides the Maduro regime with another shock force in the face of external military harassment or a coup.

• The ELN has reached some 2,400 fighters between the two countries; its main funding now comes from illicit businesses in Venezuela, such as drugs and illegal mining.

• FARC dissidents number at least 2,300; the group with the greatest projection is the one led in Venezuela by Iván Márquez, former FARC leader issue two.

• Elenos' and ex-FARC cooperate operationally in certain activities promoted by the Maduro regime, but their future organic convergence is unclear.

FARC dissidents led by Iván Márquez announce their return to arms, August 2019 [video image].

report SRA 2020 / María Gabriela Farjardo[PDF version].

The consolidation of the two main Colombian guerrilla groups - the ELN and some remnants of the former FARC - as active forces also in Venezuela, thus articulating themselves as Colombian-Venezuelan groups, constitutes one of the main notes of 2019 in the field of regional security in the Americas.

Both groups are said to have around 1,700 troops in Venezuela (two thirds of them from the ELN), of which a third (570) are said to be recruited from among Venezuelans. Used by the Chavista regime for guerrilla training of its irregular forces and as a shock force in the event of external military harassment or a coup, the ELN and ex-Farc are involved in drug trafficking, smuggling and the extraction of gold and other illegal mining, both in areas close to the border with Colombia, where they have operated for many years, and in the Venezuelan interior, such as the mining-rich states of Amazonas and Bolívar.

Following the agreement peace agreement signed between the government of Juan Manuel Santos and the Revolutionary Armed Forces of Colombia (FARC) in November 2016, the National Liberation Army (ELN) began a process of expansion that allowed it to fill the vacuum left by the FARC in various illicit activities, although its estimated issue of 2,400 troops is a far cry from the more than 8,000 that the FARC had at the time of its demobilisation. Although it has had to compete with FARC remnants that are still active as mafia elements, the ELN has become Colombia's main guerrilla force, also focused on organised crime. The ELN's 17 January 2019 attack on the Police Cadet School in Bogotá, in which 22 people were killed, marked the end of an agonising peace dialogue with the government and a flight forward as a criminal organisation.

In the process, the ELN has also been establishing itself in Venezuela, not only in border areas and as a place of refuge and hiding place as before, but also in other parts of the neighbouring country and as an area of activity. The same has happened with the FARC dissidents led by Iván Márquez, Jesús Santrich and El Paisa, who on 29 August announced their return to arms, in a video presumably recorded in Venezuela. The interest of Nicolás Maduro's regime in having the help of such armed elements has meant that the ELN and the ex-FARC of Márquez, who was the FARC's issue 2 and its chief negotiator in the peace negotiations held in Havana, have become bi-national groups, also recruiting Venezuelans.

ELN

The growing presence of these groups in Venezuela has been reported by the Colombian authorities. The commander of the Armed Forces, General Luis Navarro, indicated in mid-year that some 1,100 ELN members (just over 40 per cent of the organisation's 2,400 fighters, although other sources consider this total figure to be leave ) were taking refuge in Venezuela, and that group had at least 320 Venezuelan citizens in its ranks.

Meanwhile, during his visit to the UN General Assembly in late September, President Iván Duque raised the ELN's presence in Venezuela to 1,400 troops. Duque indicated that there were 207 geographical points controlled by the ELN on Venezuelan soil, including several training camps and twenty airstrips for drug trafficking, as documented in a controversial dossier that was not released to the public because it contained some test erroneous photographs.

A few days earlier, Foreign Minister Carlos Holmes Trujillo had told the OAS about the location of ELN fronts and FARC dissidents in Venezuela and referred to their close connections with the Chavista regime. "The links would be with members of the armed forces, the national guard, military intelligence, as well as irregular groups such as the Bolivarian Liberation Force," he said.

Other details were investigated by the Fundación Ideas para la Paz (FIP), which in its report stated that the ELN finances itself through criminal activities such as extortion and maintains control of gasoline smuggling and mining in several regions of Colombia and Venezuela. In Venezuelan territory, with a presence in at least twelve of its 24 states, it controls gold mines in Bolivar state, hundreds of kilometres from the Colombian border, and coltan mining activities in Amazonas state. According to information attributed to Colombian intelligence, these illicit activities account for 70 percent of their profits. source Thus, the ELN's base of operations in Venezuela is currently the largest source of income for the insurgent group .

FARC dissidents

As for FARC dissidents, Colombian government sources put the number of FARC dissidents at around 2,300 in mid-2019 (including non-demobilised elements, others who have returned to arms and new recruits). While this is close to the figure offered for the ELN, it should be borne in mind that FARC dissidents are atomised.

Some 600 of them are reportedly in Venezuela, including some 250 Venezuelans who have joined their ranks (almost 10 per cent of their total strength). Although these are separate groups that operate on their own, most attention has been given to the one led by Iván Márquez, due to its coordination with the Maduro regime. One episode involving this group was the alleged assassination attempt in Colombia on Rodrigo Londoño, who led the FARC as Timochenko and who has remained loyal to the peace accords. Londoño accused Márquez and El Paisa of ordering the action, foiled by Colombian security forces and unveiled in January 2020, so that other ex-guerrillas would return to arms as they ran out of leadership in civilian life.

Internal documentation of the Venezuelan secret services published by Semana reveals the close relationship between the Maduro government, the ELN and the ex-FARCpartnership . "The regime went from hiding fugitive guerrillas in the early 2000s to serving as the headquarters of operations for these groups. Not only do they prepare militarily, but they also train the militias and the so-called colectivos in guerrilla warfare tactics and strategies," the weekly said.

All this is producing an operational convergence in Venezuela between the ELN and the ex-FARC. However, status does not necessarily lead to a merger of the two groups, which in Colombia maintain their differences, further encouraged by the aspirations of the different criminal groups into which the FARC dissidents have split, and which are referred to in the plural for a reason.

signature On the other hand, the implementation of the Peace Accords was framed in 2019 in a growing climate of insecurity caused by the murder during the year of 77 former FARC guerrillas (173 since the peace agreement was signed in 2016) and 86 local social leaders, according to the report of the UN's University Secretary, António Guterres. Colombian organisations put the latter figure higher, such as the high school of programs of study for development and Peace(Indepaz), which reports 282 homicides, often linked to the attempt to replace coca with legal crops in regions where drug trafficking is active. In any case, this is a decrease compared to 2018, something that can be attributed to the fact that the new territorial distribution of armed groups has already been consolidated and they have less effective resistance.

US Southern Command highlights Iranian interest in consolidating Hezbollah's intelligence and funding networks in the region

• Throughout 2019, Rosneft tightened its control over PDVSA, marketing 80% of production, but US sanctions forced it to leave the country.

• The arrival of Iranian Revolutionary Guard troops comes amid a US naval and air deployment in the Caribbean, not far from Venezuelan waters.

• The Iranians, once again beset by Washington's sanctions, return to the country that helped them circumvent the international siege during the era of the Chávez-Ahmadinejab alliance.

​

▲ Nicolás Maduro and Iranian President Hassan Rouhani at a meeting in Tehran in 2015 [Hossein Zohrevand, Tasnim News Agency].

report SRA 2020 / Emili J. Blasco [PDF version].

financial aid In a short period of time, Venezuela has gone from depending on Chinese loans to relying on the Russian energy sector (as was particularly evident in 2019) and then to asking for the help of Iranian oil technicians (as was seen at the beginning of 2020). If the Chinese public loans were supposed to keep the country running, Rosneft's aid was only intended to save the national oil company, PDVSA, while the Iranian Revolutionary Guard's financial aid only aims to reactivate some refineries. Whoever assists Venezuela is getting smaller and smaller, and purpose is getting smaller and smaller.

In just ten years, China's big public banks granted 62.2 billion dollars in loans to the Venezuelan government. The last of the 17 loans came in 2016; since then Beijing has ignored the knocks Nicolás Maduro has made on its door. Although since 2006 Chavismo had also received credits from Moscow (some $17 billion for the purchase of arms from Russia itself), Maduro turned to pleading with Vladimir Putin when the Chinese financial aid ended. Unwilling to give any more credit, the Kremlin articulated another way of helping the regime while ensuring immediate benefits. Thus began Rosneft's direct involvement in various aspects of the Venezuelan oil business, beyond the specific exploitation of certain fields.

This mechanism was particularly relevant in 2019, when the progressive US sanctions on Venezuela's oil activity began to have a major effect. To circumvent the sanctions on PDVSA, Rosneft became a marketer of Venezuelan oil, controlling the marketing of most of the total production (between 60 and 80 per cent).

Washington's threat to punish Rosneft also led the company to shift its business to two subsidiaries, Rosneft Trading and TNK Trading International, which in turn left the business when the US pointed the finger at them. Although Rosneft generally serves the Kremlin's geopolitical interests, the fact that it is owned by BP or Qatari funds means that the company does not so easily risk its bottom line.

The departure of Rosneft, which also saw no economic sense in continuing its involvement in reactivating Venezuela's refineries, whose paralysis has plunged the country into a generalised lack of fuel supply to the population, left Maduro with few options. The Russians abandoned the Armuy refinery at the end of January 2020, and the following month Iranians were already trying to get it up and running again. Within weeks, Iran's new involvement in Venezuela became public: Tarek el Assami, the Chavista leader with the strongest connections to Hezbollah and the Shia world, was appointed oil minister in April, and in May five cargo ships brought fuel oil and presumably refining machinery from Iran to Venezuela.

The supply did not solve much (the gasoline was barely enough for a few weeks' consumption) and the Iranian technicians, at least some of them led by the Revolutionary Guard, were unlikely to be able to fix the refining problem. Meanwhile, Tehran was getting substantial shipments of gold in return for its services (nine tonnes, according to the Trump Administration). The Iranian airline Mahan, used by the Revolutionary Guards in their operations, was involved in the transports.

Thus, suffocated by the new outline sanctions imposed by Donald Trump, Iran returned to Venezuela in search of economic oxygen and also of political partnership vis-à-vis Washington, as when Mahmoud Ahmadinejad allied with Hugo Chávez to alleviate the restrictions of the first sanctions regime that the Islamic nation suffered.

US naval and air deployment

Iran's "interference" in the Western Hemisphere had already been mentioned, among the list of risks to regional security, in the appearance of the head of the US Southern Command, Admiral Craig Faller, on Capitol Hill in Washington (in January he went to the Senate and in March to the House of Representatives, with the same written speech ). Faller referred in particular to Iran's use of Hezbollah, whose presence on the continent has been aided by Chavismo for years. According to the admiral, this Hezbollah-linked activity 'allows Iran to gather intelligence and carry out contingency planning for possible retaliatory attacks against the United States and/or Western interests'.

However, the novelty of Faller's speech lay in two other issues. On the one hand, for the first time the head of the Southern Command placed China's risk ahead of Russia's, in a context of growing rivalry between Washington and Beijing, which is also manifested in the positioning of Chinese investments in strategic infrastructure works in the region.

On the other hand, he announced a forthcoming 'increased US military presence in the hemisphere', something that began to take place at the end of March 2020 when US ships and aircraft were deployed in the Caribbean and the Pacific to reinforce the fight against drug trafficking. In the context of its speech, this increased military activity in the region was understood as a necessary notice towards extra-hemispheric countries.

"Above all, what matters in this fight is persistent presence," he said, "we have to be present on the field to compete, and we have to compete to win. Specifically, he proposed more joint actions and exercises with other countries in the region and the "recurring rotation of small special operations forces teams, soldiers, sailors, pilots, Marines, Coast Guardsmen and staff National Guard to help us strengthen those partnerships".

But the arrival of US ships close to Venezuelan waters, just days after the announcement on 26 March from New York and Miami of the opening of a macro-court case for drug trafficking and other crimes against the main Chavista leaders, including Nicolás Maduro and Diosdado Cabello, gave this military deployment the connotation of a physical encirclement of the Chavista regime.

That deployment also gave some context to two other developments shortly thereafter, offering misleading readings: the failed Operation Gideon on 3 May by a group group of mercenaries who claimed they intended to infiltrate the country for Maduro (the increased transmission capabilities acquired by the US in the area, thanks to its manoeuvres, were not used in principle in this operation), and the arrival of the Iranian ships at the end of the month (the US deployment raised suspicions that Washington could intercept the ships' advance, which did not happen).

Regional security in the Americas has been the focus of concern over the past year in Venezuela. We also review Russia and Spain's arms sales to the region, Latin America's presence in peacekeeping missions, drugs in Peru and Bolivia, and homicides in Mexico and Brazil.

▲ Igor Sechin, director Rosneft executive, and Nicolás Maduro, in August 2019 [Miraflores Palace].

report SRA 2020 / summary executive[PDF version].

Throughout 2019, Latin America had several hotspots of tension - violent street protests against economic measures in Quito, Santiago de Chile and Bogotá, and against political decisions in La Paz and Santa Cruz, for example - but as these conflicts subsided (in some cases, only temporarily), the constant problem of Venezuela as the epicentre of insecurity in the region re-emerged.

With Central American migration to the United States reduced to a minimum by the Trump administration's restrictive measures, it has been Venezuelan migrants who have continued to fill the roadsides of South America, moving from one country to another, and now number more than five million refugees. The difficulties that this population increase entails for the host countries led several of them to increase their pressure on the government of Nicolás Maduro, approving in the OAS the activation of the Inter-American Reciprocal Treaty of attendance (TIAR). But that did not push Maduro out of power, nor did the assumption in January 2019 by Juan Guaidó of the position as president-in-charge of Venezuela (recognised by more than fifty countries), the failed coup a few months later or the alleged invasion of Operation Gideon in May 2020.

While Maduro may appear stabilised, the geopolitical backdrop has been shifting. The year 2019 saw Rosneft gain a foothold in Venezuela as an arm of the Kremlin, once China had stepped back as a credit provider. The risk of not recovering everything it had borrowed meant that Russia acted through Rosneft, benefiting from trading up to 80 per cent of the country's oil. However, US sanctions finally forced the departure of the Russian energy company, so that in early 2020 Maduro had no other major extra-hemispheric partner to turn to than Iran. The Islamic republic, itself subject to a second sanctions regime, thus returned to the close relationship it had maintained with Venezuela in the first period of international punishment, cultivated by the Chávez-Ahmadinejad tandem.

This Iranian presence is closely watched by the United States (coinciding with a deployment of the Southern Command in the Caribbean), which is always alert to any boost that Hezbollah - an Iranian proxy - might receive in the region. In fact, 2019 marked an important leap in the disposition of Latin American countries against this organisation, with several of them classifying it as a terrorist organisation for the first time. Argentina, Paraguay, Colombia and Honduras approved such a declaration, following the 25th anniversary in July of the AMIA bombing attributed to Hezbollah. Brazil and Guatemala pledged to do so shortly. Several of these countries have drawn up lists of terrorist organisations, which allows them to pool their strategies.

The destabilisation of the region by status in Venezuela has a clear manifestation in the reception and promotion of Colombian guerrillas in that country. issue In August, former FARC leader Iván Márquez and some other former leaders announced, presumably from Venezuelan territory, their return to arms. Both this dissident core of the FARC and the ELN had begun to consolidate at the end of the year as Colombian-Venezuelan groups, with operations not only in the Venezuelan border area, but also in the interior of the country. Both groups together have some 1,700 troops in Venezuela, of which almost 600 are Venezuelan recruits, thus constituting another shock force at Maduro's service.

Russia's exit from Venezuela comes at a time when Moscow is apparently less active in Latin America. This is certainly the case in the field of arms sales. Russia, which had become a major exporter of military equipment to the region, has seen its sales decline in recent years. While during the golden decade of the commodity boom several countries spent part of their significant revenues on arms purchases (which also coincided with the spread of the Bolivarian tide, better linked to Moscow), the collapse in commodity prices and some governmental changes have meant that in the 2015-2019 period Latin America is the destination of only 0.8 per cent of Russia's total arms exports. The United States has regained its position as the largest seller to the rest of the continent.

Spain occupies a prominent position in the arms market, as the seventh largest exporter in the world. However, it lags behind in the preferences of Latin American countries, to which it sells less defence materiel than it would be entitled to in terms of the overall volume of trade it maintains with them. Nevertheless, the level of sales increased in 2019, after a year of particularly low figures. In the last five years, Spain has sold 3.6% of its global arms exports to Latin America; in that period, its main customers were Mexico, Ecuador, Brazil, Peru and Colombia.

Better military equipment might suggest greater participation in UN peacekeeping missions, perhaps as a way of keeping an army active in a context of a lack of regional deployments. However, of the total of 82,480 troops in the fourteen UN peacekeeping missions at the beginning of 2020, 2,473 came from Latin American countries, which represents only 3 per cent of the total contingent. Moreover, almost half of staff was contributed by one country, Uruguay (45.5% of regional troops). Another small country, El Salvador (12%), is the next most committed to missions, while large countries are under-represented, notably Mexico.

In terms of public safety, 2019 brought the good news of a reduction in homicides in Brazil, which fell by 19.2% compared to the previous year, in contrast to what happened in Mexico, where they rose by 2.5%. If in his first year as president, Jair Bolsonaro scored an important achievement, thanks to the management of the super security minister Sérgio Moro (a success tarnished by the increase in accidental deaths in police operations), in his first year Andrés Manuel López Obrador failed to fulfil one of his main electoral promises and was unable to break the upward trend in homicides that has invariably occurred annually throughout the terms of office of his two predecessors.

In terms of the fight against drug trafficking, 2019 saw two particularly positive developments. On the one hand, coca crops were eradicated for the first time in the VRAEM, Peru's largest production area. Given its difficult accessibility and the presence of Shining Path strongholds, the area had previously been excluded from the operations of subject. On the other hand, the change of presidency in Bolivia meant, according to the US, a greater commitment by the new authorities to combat illicit coca cultivation and interdict drug shipments coming from Peru. In recent years Bolivia has become the major cocaine distributor in the southern half of South America, connecting Peruvian and Bolivian production with the markets of Argentina and especially Brazil, and with its export ports to Europe.

Venezuelans leaving the country to look for a livelihood in a place of refuge [UNHCR UNHCR].

[download the complete PDF]

report SRA 2020 / presentation

The Covid-19 pandemic has radically altered security assumptions around the world. The emergence of the coronavirus moved from China to Europe, then to the United States and then to the rest of the Western Hemisphere. Already economically handicapped by its dependence on commodity exports since the beginning of the Chinese slowdown, Latin America suffered from the successive restrictions in the different geographical areas, and finally also entered a crisis of production and consumption and a health and labour catastrophe. The region is expected to be one of the hardest hit, with effects also in the field of security.

This annual report , however, focuses on American regional security in 2019. Although in some respects it includes events from the beginning of 2020, and therefore some early effects of the pandemic, the impact of the pandemic on issues such as regional geopolitics, state budgetary difficulties, organised crime and citizen security can be found at report next year.

To the extent that other security developments in 2019 have been somewhat transitory in recent months, Venezuela has remained the main focus of regional insecurity over the past year. At report we analyse Iran's return to the Caribbean country, after first China and then Russia preferred not to see their own economic interests harmed; we also note the consolidation of the ELN and part of the ex-FARC as binational Colombian-Venezuelan groups.

In addition, we highlight the progress made in the first time that Hezbollah has been designated by several countries as a terrorist organisation, group , and we provide figures on the drop in Russian arms sales to Latin America and the relative lack of marketing in the region of the defence material produced by Spain. We also quantify the contribution of Latin American troops to UN peacekeeping missions, as well as Bolsonaro's success and AMLO's failure in the evolution of homicides in Brazil and Mexico. In terms of drug trafficking, 2019 saw the first coca crop eradication operation in the VRAEM, the most complicated area of Peru in the fight against drugs.

One of the main instruments for combating poverty loses its relevance between the end of the "golden decade" and the beginning of the "second lost decade".

So-called Conditional Cash Transfers (CCTs) -submission of money to disadvantaged families with a commitment to schooling, medical check-ups or other basic requirements that, along with improving household incomes, sought to promote the options of the younger generation - have over the last two decades helped to significantly increase the class average in Latin America. But once beyond the subsistence level, citizens have recently begun to demand improved services, such as teaching, healthcare or transport - as seen in the protests of recent months in the region - to which CCTs no longer provided an answer. Just as countries were thinking of readapting their policies in response to this change in perspective, the Covid-19 crisis threatened to throw millions of people back into poverty, so cash transfers became necessary again, this time without conditionalities.

Beneficiaries of Brazil's Bolsa Família, one of the pioneering conditional cash transfer programmes [Gov. of Brazil].

article / María Gabriela Fajardo

The first Conditional Cash Transfer (CCT) programmes in Latin America, a pioneer region in the implementation of this instrument, were developed in the mid-1990s in Brazil and Mexico with the intention of "transforming and halting the intergenerational transmission of poverty through the development of human capacities in the most vulnerable families", as stated by a report of ECLAC (United Nations Economic Commission for Latin America and the Caribbean). status The CCTs were designed to provide support to families in poverty or extreme poverty with under-age children. The submission of this monetary aid (also non-monetary) was provided as long as the families complied with basic conditions of health, Education and nutrition for the children.

The implementation of CCTs spread rapidly throughout the region. In 1997, only four countries had any of these programmes: Brazil (Bolsa Escola), Ecuador (Bono Solidario), Honduras (Programa de Asignación Familiar) and Mexico (Progresa). A decade later, almost all Latin American countries had adapted the initiative.

Although in some cases this tool has been controversial, given that some governments have been able to use it as "an instrument of social policy and its targeting is discussed as a strategy to address actions that must operate under restricted budgets", according to the aforementioned report of ECLAC, the truth is that CCTs are considered to have contributed to the socio-economic progress of the region. Alejandro Werner, director for the Western Hemisphere of the International Monetary Fund (IMF), recently pointed this out. "In the last 15 years," he said, giving part of the credit to CCTs, "important progress has been made in the topic area of poverty alleviation and reduction of income maldistribution. In this way, Latin America is probably the region where we see the greatest improvement in income distribution".

agreement Between 2002 and 2014, a time known in Latin America as the "golden decade" (a consequence of the commodities boom ), the poverty rate in the region fell from 45.4% to 27.8%, so that 66 million people overcame that status, according to the Social Panorama of Latin America 2019 published by ECLAC. Additionally, the extreme poverty rate decreased from 12.2% to 7.8%. However, since 2015, the level of poverty and extreme poverty began to increase, patron saint which has continued since then, albeit moderately. For 2019, ECLAC predicted an increase in poverty and extreme poverty to fees of 30.8% and 11.5%, respectively, so that 27 million more people returned to poverty compared to 2014. 

The challenge: from extreme poverty, to the class average

This slight reversal indicates that many who in that "golden decade" gained access to the class average , making this sector of the population a majority for the first time, find themselves in a high Degree of vulnerability. At the same time, these people have seen their expectations of subsequent progress and access to better services from the state unmet after their previous status of survival. The new challenge in many countries was to make public policies revolve around other factors that would allow the consolidation of these people in the class average . This neglect generated discontent that contributed to the large protests in several Latin American countries at the end of 2019.

The increased demands of a better-off population made structural deficiencies more evident. "The region's structural deficiencies have become more evident and their solution is part of the demands of broad social groups, particularly the new generations", according to report Social Panorama. In particular, ECLAC warned about "segmented access to quality public and cultural services".

In Werner's words, "having achieved such a significant reduction in the reduction of poverty also generates an important challenge for policy makers in Latin America, since the design of social policies has to be oriented towards attending to other factors, not to the reduction of extreme poverty. It is not that we have to forget about that, but clearly the challenge now is to focus also on addressing those segments of the population that are no longer in poverty, which are class average ". After underlining the precariousness of this large group of the population that has moved up the social ladder, the IMF's manager for the Western Hemisphere indicated that "clearly the instruments to address this vulnerability are different from the conditional transfer schemes that were implemented in the past", and specifically cited access to quality health and Education .

However, states have faced the need for this paradigm shift without budgetary support. It is evident that the state has little capacity to respond to the new needs of the vulnerable population affected by low levels of education, few opportunities at work and the inefficiency of the pension system.

The countries have found that economic growth, which between 2000 and 2013 hovered jointly around 2%, has been weakening since 2014. Thus, real GDP per capita in the region has declined by 0.6% per year. The causes of this decline in economic growth can be classified into two factors, as Werner explained. Firstly, structural causes have inhibited potential growth due to "low investment, slow productivity growth, a poor business climate Pass , the leave quality of infrastructure and Education". Second, cyclical causes include weak global economic growth and low commodity prices; uncertainty in large regional economies such as Brazil and Mexico, sudden economic stops in stressed economies such as Argentina and Ecuador, and social tensions in the last quarter of 2019.

Coronavirus

The emergence of the Covid-19 pandemic has worsened the economic outlook for Latin America and the Caribbean, for which the April 2020 report forecasts a 5.2% drop in GDP this year. Although the IMF estimates a recovery of 3.4% in 2021, this will not be enough to allay fears of a new "lost decade". In his most recent intervention to comment on these data, Werner warned that between 2015 and 2025 GDP per capita "will be flat".

To cope with this new status, socially aggravated by the health crisis and the suffering of so many people, governments are resorting to direct cash transfers, no longer conditional, to vulnerable households. In a way, it is a return to a stage of need that was even earlier, before the CCTs were extended. It is a return to the urgency of the 1980s, known in Latin America as the lost decade, when countries had to apply shock measures to get out of a severe public debt crisis.

development The president of the Inter-American Development Bank (IDB), Luis Alberto Moreno, believes that it is still too early to speak of a second lost decade, but agrees that the time is ripe for unconditional transfer programmes. "The big question is whether everything we have achieved in the last 15 years in terms of reducing poverty and extreme poverty, with the incorporation of some Latin Americans into the middle classes, is going to be lost or whether, on the contrary, the capacity of the social systems and the governments' drive to increase the debt and the public expense will cushion the effects," Moreno affirms. All the countries "are strengthening the transfer programmes that were developed almost two decades ago, and which have been very successful", although "in this case they will not be conditional, in order to preserve the income of many families".

[Scott Martelle, William Walker's Wars. How One Man's Private Army Tried to Conquer Mexico, Nicaragua, and Honduras. Chicago Review Press. Chicago, 2019. 312 p.]

review / Emili J. Blasco

The history of US interference in Latin America is long. In plenary session of the Executive Council Manifest Destiny of westward expansion in the mid-19th century, to extend the country from coast to coast, there were also attempts to extend sovereignty to the South. Those who occupied the White House were satisfied with half of Mexico, which completed a comfortable access to the Pacific, but there were personal initiatives to attempt to purchase and even conquer Central American territories.

One such initiative was led by William Walker, who, at the head of several hundred filibusters - the American Phalanx - seized the presidency of Nicaragua and dreamed of a slave empire that would attract investment from American Southerners if slavery was abolished in the United States. Walker, from Tennessee, first tried to create a republic in Sonora, to integrate that Mexican territory into the US, and then focused his interest on Nicaragua, then an attractive passage for Americans who wanted to cross the Central American isthmus to the gold mines of California, where he himself had sought his fortune. Disallowed and detained several times by the US authorities, due to the problems he caused them with neighbouring governments, he was finally expelled from Nicaragua by force of arms and shot dead while trying to return by setting foot in Honduras.

Scott Martelle's book is both a portrait of the character - someone with no special leadership skills and a rather delicate appearance unbefitting a mercenary chief, who nevertheless managed to generate lucrative expectations among those who followed him (2,518 Americans enlisted) - and a chronicle of his military campaigns in the South of the United States. It also describes well the mid-19th century atmosphere in cities such as San Francisco and New Orleans, filled with migrants from other parts of the country and in transit to wherever fortune would take them.

It also provides a detailed account of the business developed by the tycoon Vanderbilt to establish a route, inaugurated in 1851, which used the San Juan River to reach Lake Nicaragua and from there to the Pacific, with the aim of establishing a railway connection and the subsequent purpose to build a canal in a few years. Although the overland route was longer than the one that at that time was also being made under similar conditions on the Isthmus of Panama, the journey by boat from the USA to Nicaragua was shorter than the one that required going all the way to Panama. The latter explains why, during the second half of the 19th century, the project Nicaragua Canal had more supporters in Washington than the Panama Canal.

While Panama is one of the symbols of US interference in its "backyard", the success of the transoceanic canal project and its return to the Panamanians largely defuses a "black legend" that still exists in the Nicaraguan case. Nicaragua is probably the Central American country that has experienced the most US "imperialism". The Walker episode (1855-1857) marks a beginning, followed by the US government's own military interventions (1912-1933), Washington's close support for the Somoza dictatorship (1937-1979) and direct involvement in the fight against the Sandinista Revolution (1981-1990).

Walker arrived in Nicaragua, attracted by US interest in the inter-oceanic passage and with the excuse of helping one of the sides in one of the many civil wars between conservatives and liberals in the former Spanish colonies. Elevated to head of the army, in 1856 he was elected president of a country in which he could barely control the area whose centre was the city of Granada, on the northern shore of Lake Nicaragua.

As he established his power he moved away from any initial idea of integrating Nicaragua into the US and dreamed of forging a Central American empire that would even include Mexico and Cuba. Slavery, which had been abolished in Nicaragua in 1838 and reinstated by him in 1856, entered into his strategy. He envisioned it as a means of preventing Washington from giving up extending its sovereignty to those territories, given the internal balances in the US between slave and non-slave states, and as an attraction of capital from southern slaveholders. He was finally expelled from the country in 1857 thanks to the push of an army assembled by neighbouring countries. In 1860 he attempted a return, but was captured and shot in Trujillo (Honduras). His adventure was fuelled by a belief in the superiority of the white, Anglo-Saxon man, which led him to despise the aspirations of the Hispanic peoples and to overestimate the military capacity of their mercenaries.

Martelle's book responds more to a historicist than a popularising purpose , so it is not so much for the general public as for those specifically interested in William Walker's Fulibusterism: an episode, in any case, of convenient knowledge on the Central American past and the relationship of the United States with the rest of the Western Hemisphere.

[Maria Zuppello, Il Jihad ai Tropici. Il patto tra terrorismo islamico e crimine organizzato in America Latina. Paese Edizioni. Roma, 2019. 215 p.]

review / Emili J. Blasco

We usually link jihad to the Middle East. If anything, also with the African Sachel, opening the map to the West, or with the border of Afghanistan, Pakistan and India, opening it to the East. However, Latin America also has a place in this geography. It has a place to finance the terrorist struggle - cocaine is a business that Islamists take advantage of, as is the case with heroin in the specific case of the Taliban - and also as a space in which to go unnoticed, off the radar (Caribbean or Brazilian beaches are the last place that would be imagined as a hiding place for jihadists).

Jihad in the Tropics, by Italian researcher Maria Zuppello, deals precisely with that lesser-known aspect of global jihadism: the caipirinha jihadists, to put it graphically, to emphasise the normality with which these radicalised elements live in the Latin American context, although these are criminal networks more sinister than the name might suggest.

Zuppello's research , which is subtitled "the pact between Islamic terrorism and organised crime in Latin America", deals with various countries, although it is in Brazil where the author locates the main connections with the rest of the region and with the international Structures of different jihadist groups. In particular, she points out the link between the religious leader Imran Hosein, who propagates Salafist doctrines, and the attack on the Bataclan party conference room in Paris, as his preaching was particularly responsible for the radicalisation of one of the terrorists, Samy Amimour. Zuppello also analyses the cross-contacts of the Brazilians who were arrested in 2016 in the Hashtag operation, in the final stretch of the preparation for the Rio de Janeiro Olympic Games.

Zuppello's book begins with a presentation at position by Emanuele Ottolenghi, researcher who works at the Foundation for Defense of Democracies, a Washington think tank. Ottolenghi is an expert on Hezbollah's presence in Latin America, on which he has written numerous articles.

At presentation, Ottolenghi highlights the partnership established between jihadist elements and certain levels of the Latin American left, especially the Bolivarian left. "The extremist messages differ little from the rhetoric of the radical left's anti-imperialist revolution, deeply rooted for decades in Latin America", he argues. This explains "the appeal of the Islamic revolution to the descendants of the Incas in the remote Andean community of Abancay, a four-hour drive from Machu Picchu, and to Cuban and Salvadoran revolutionaries (now dedicated to spreading Khomeini's word in Central America)".

For Ottolenghi, "the central topic of the red-green alliance between Bolivarians and Islamists is the so-called resistance to US imperialism. Behind this revolutionary rhetoric, however, there is more. The creation of a strategic alliance between Tehran and Caracas has opened the door to Latin America for the Iranian Revolutionary Guards and Hezbollah. Venezuela has become a hub for Iran's agents in the region".

Illicit trafficking generates millions in dirty money that is laundered through international circuits. The "Lebanese diaspora communities" in areas such as La Guaira (between Venezuela and Colombia), Margarita Island (Venezuela), the free trade zone of Colón (Panama) and the Triple Border (between Brazil, Paraguay and Argentina) are important in this process.

It is precisely this tri-border area that has been the usual place to refer to when talking about Hezbollah in Latin America. The 1992 and 1994 attacks in Buenos Aires against the Israeli Embassy and the AMIA, respectively, had their operational origins there, and since then the financial links of this geographical corner with the Shiite extremist group have been frequently documented. Since Hugo Chávez came to power, there has been a convergence between Venezuela and Iran that has allowed Islamist radicals to obtain Venezuelan passports, and they have also been taking over part of the drug trafficking business as Chávez himself has drawn the Venezuelan state into the cocaine business.

The convergence of interests between organised crime networks in the region and jihadist elements raises the question, according to Zuppello, of whether "Latin America will end up being the new cash machine for the financing of global jihad", or even "something else: a hideout for fleeing foreign fighters or a new platform for attacks, or both".

One of the specific aspects Zuppello refers to is the halal sector and its certifications, which is growing exponentially, causing concern among counter-terrorism authorities in several countries, who accuse the sector of concealing terrorist financing and money laundering. The halal meat trade has provided cover for dozens of Iranian meat inspectors, who have taken up permanent residence in the region.

Research such as that carried out in Jihad in the Tropics has led to a number of Latin American countries agreeing for the first time in 2019 to recognise Hezbollah as a terrorist organisation group .

27% of Latin America's total private wealth is held in territories that offer favourable tax treatment.

Latin America is the world region with the highest percentage of private offshore wealth. The proximity of tax havens, in various countries or island dependencies in the Caribbean, can facilitate the arrival of this capital, some of which is generated illicitly (drug trafficking, corruption) and all of which evades national tax institutions with little supervisory and coercive force. Latin America lost 335 billion dollars in taxes in 2017, which represented 6.3% of its GDP.

▲ Caribbean beach [Pixabay].

article / Jokin de Carlos Sola

The natural wealth of Latin American countries contrasts with the precariousness of the economic status of a large part of their societies. Lands rich in oil, minerals and primary goods sometimes fail to feed all their citizens. One of the reasons for this deficiency is the frequency with which companies and leaders tend to evade taxes, driving capital away from their countries.

One of the reasons for the tendency to evade taxes is the large size of the Economics underground and the shortcomings of states in implementing tax systems. Another is the nearby presence of tax havens in the Caribbean, which have historically been linked to the UK. These territories with beneficial tax characteristics have attracted capital from the continent.

History

The history of tax evasion is a long one. Its relationship with Latin America and the British Caribbean archipelagos, however, has its origins in the fall of the British Empire.

From 1945 onwards, Britain gradually began to lose its colonial possessions around the world. The financial effect was clear: millions of pounds were lost or taken out of operations across the empire. To cope with this status and to be able to maintain their global financial power, the bankers in the City of London thought of creating fields of action outside the jurisdiction of the Bank of England, from where bankers from all over the world (especially Americans) could also operate in order to avoid their respective national regulations. A new opportunity then arose in the British overseas territories, some of which did not become independent, but maintained their links, albeit loose, with the United Kingdom. This was the case in the Caribbean.

In 1969 the Cayman Islands created the first banking secrecy legislation. It was the first overseas territory to become a tax haven. From offices established there, City banks built up networks of operations unregulated by the Bank of England and with little local oversight. Soon other Caribbean jurisdictions followed suit.

Tax havens

The main tax havens in the Caribbean are British Overseas Territories such as the Cayman Islands, the Virgin Islands and Montserrat, or some former British colonies that became independent, such as the Bahamas. These are islands with small populations and a small Economics . Many of the politicians and legislators in these places work for the British financial sector and ensure secrecy within their territories.

Unlike other locations that can also be considered tax havens, the British-influenced islands in the Caribbean offer a second level of secrecy in addition to the legal one: the trust. Most of those who hold assets in companies established in these territories do so through trusts. Under this system, the beneficiary holds his assets (shares, property, companies, etc.) in a trust which is administered by a trustee. These elements (trust, beneficiary, trustee, shell companies, etc.) are distributed in various Structures linked to different Caribbean jurisdictions. Thus, a trust may be established in one jurisdiction, but its beneficiaries may be in another, the trustee in a third, and the shell companies in a fourth. This is a subject of Structures that is almost impossible for governments to dismantle. This is why when overseas governments agree to share banking information, under pressure from Washington or Brussels, it is of little use because of the secrecy structure itself.

Impact in Latin America

Bank secrecy legislation emerged in Latin America with the goal aim of attracting legally obtained capital. However, during the 1970s and 1980s, this protection on data of current accounts also attracted capital obtained through illicit means, such as drug trafficking and corruption.

During those years, drug lords such as Pablo Escobar used the benefits of the Cayman Islands and other territories to hide their fortunes and properties. On the other hand, several Latin American dictatorships also used these mechanisms to hide the enrichment of their leaders through corruption or even drugs, as was the case with Panama's Manuel Noriega.

Over time, the international community has increased its pressure on tax havens. In recent years the authorities in the Cayman Islands and the Bahamas have made efforts to ensure that their secrecy Structures is not used to launder money for organised crime, but not all territories considered tax havens have done the same.

These opaque networks are used by a considerable part of Latin America's large fortunes. Twenty-seven per cent of Latin America's total private wealth is deposited in countries that offer favourable tax treatment, making it the region with the highest proportion of private capital in these places in the world, according to a 2017 study by the Boston Consulting Group ( agreement ). According to this consultancy firm, this diversion of private wealth is greater in Latin America than in the Middle East and Africa (23%), Eastern Europe (20%), Western Europe (7%), Asia-Pacific (6%) and the United States and Canada (1%). 

Tax havens are the destination of a part that is difficult to pinpoint of the total of 335 billion dollars subject to tax evasion or avoidance in the region in 2017, a figure that constituted 6.3% of Latin American GDP (4% lost in personal income tax and 2.3% in VAT), as specified in ECLAC's report Fiscal Panorama of Latin America and the Caribbean 2019. This UN economic commission for the region highlights that on average Latin American countries lose more than 50% of their income tax revenues.

The London connection

There have been various theories about the role played by London in relation to tax havens. These theories coincide in presenting a connection of interests between the opaque companies and the City of London, in a network of complicity in which even the Bank of England and the British government could have been involved.

The most important one was expressed by British author Nicholas Shaxson in the book Treasure Island. The thesis was later developed by the documentary film Spiders Web, produced by the Tax Justice Network, whose founder, John Christiansen, worked as advisor for the government of Jersey, which is a special jurisdiction.

The City of London has a separate administration, elected by the still-existing guilds, which represent the City's commercial and banking class . This allows financial operations in this area of the British capital to partially escape the control of the Bank of England and government regulations. A City that is attractive to foreign capital and prosperous is of great benefit to the UK's Economics , as its activity accounts for 2.4% of the country's GDP.

British sovereignty over the overseas territories that serve as tax havens sometimes leads to accusations that the UK is complicit with these financial networks. Downing Street responds that these are territories that operate with a great deal of autonomy, even though London sets the governor, controls foreign policy and has veto power over legislation passed in these places.

Moreover, it is true that the UK government has in the last decade supported greater international coordination to increase scrutiny of tax havens, forcing the authorities there to submit relevant tax information, although the structure of the trusts still works against transparency.

Correct the status

Latin America's problems with tax evasion may be more related to the fragility of its own tax institutions than to the presence of tax havens close to the American continent. At the same time, some tax havens have benefited from political instability and corruption in Latin America.

The effects of domestic capital flight to these places of special tax regimes are clearly negative for the countries of the region, depriving them of increased economic activity and revenue-raising possibilities, and hampering the state's ability to undertake the necessary improvement of public services.

It is therefore imperative that certain corrective policies are put in place. At the national policy level, mechanisms should be put in place to prevent tax evasion and avoidance. At the same time, at the international level, diplomatic initiatives should be shaped to put an end to the Structures of trusts. The OAS offers, in this sense, an important negotiating framework not only with certain overseas territories, but also with its own metropolises, since these, as is the case of the United Kingdom, are permanent observer members of the hemispheric organisation.

Criticism of Maduro, the resizing of the Chinese embrace and greater migration control mark the harmony with Washington after ten years of FMLN rule.

The surprising use of the military to pressure the Salvadoran Legislative Assembly in early February to approve a security appropriation has raised international alarm about what the presidency of Nayib Bukele, who came to power in June 2019, may hold. Bukele's first half-year of closer relations with the United States, after two decades of rule by the former FMLN guerrillas, may have led Bukele to believe that his authoritarian gesture would be excused by Washington. The unanimous reaction in the region made him correct the shot, at least for the time being.

▲ Swearing in of Nayib Bukele as president, in June 2019, with his wife, Gabriela Rodríguez [Presidency of El Salvador].

article / Jimena Villacorta

El Salvador and the United States had a close relationship during the long political dominance of the right-wing ARENA party, but the coming to power in 2009 of the Farabundo Martí National Liberation Front (FMLN) brought El Salvador into alignment with the ALBA countries (mainly Venezuela, Nicaragua and Cuba), which led to occasional tension with Washington. Furthermore, in 2018, in the final stretch of Salvador Sánchez Cerén's presidency, diplomatic relations with Taiwan were severed and the possibility of strategic investments by China was opened up, which were viewed with suspicion by the United States (especially the option of controlling the Pacific port of La Unión, due to the risk of its military use in a crisis). status .

Nayib Bukele won the early 2019 elections presenting himself as an alternative to the traditional parties, despite the fact that he was mayor of San Salvador (2015-2018) leading a coalition with the FMLN and that for the presidential elections he stayed with the acronym GANA, created a few years earlier as a split from ARENA. His denunciation of the corruption of the political system, in any case, was credible for the majority of an electorate that was certainly tired of the Bolivarian tone of recent governments.

During his electoral campaign, Bukele had already advocated improving relations with the United States, as it is a partner more economically interesting for El Salvador than the ALBA nations. "Any financial aid that comes is welcome, and better if it is from the United States", said one of his advisors. These messages were immediately received in Washington, and in July the US Secretary of State, Mike Pompeo, visited El Salvador: it was the first time in ten years, precisely the time of the FMLN's two consecutive presidencies, that the head of US diplomacy had visited the Central American country. This trip served to accentuate the partnership at subject in the fight against drug trafficking and the gang problem, two shared problems. "We have to fight the MS-13 gang, which has sown destruction in El Salvador and also in the United States, because we have its presence in almost 40 of the 50 states in our country," Pompeo said.

In line with the change of orientation it was undergoing, El Salvador began to align itself in regional forums against the regime of Nicolás Maduro. Thus, on 12 September, the Salvadoran representation in the Organisation of American States (OAS) supported the activation of the Inter-American Reciprocal Treaty of attendance (TIAR), after years of abstaining or voting in favour of resolutions supporting Chávez's Venezuela. On 3 December Bukele announced the expulsion from El Salvador of Maduro's government diplomats, an action immediately replicated by Caracas.

In the same months, El Salvador accepted the terms of the new migration approach that the Trump administration was outlining. During the summer, the White House negotiated with the countries of the Central American Northern Triangle agreements similar to the safe third country mechanism, whereby Guatemala, Honduras and El Salvador agreed to process as asylum seekers those who had passed through their territory and ended up in the US by formalising this application. Bukele met with Trump in September at the United Nations General Assembly framework and signed the agreement, which was presented as an instrument to combat organised crime, strengthen border security, reduce smuggling and human trafficking. 

The signature of agreement proved to be controversial, as many authorities questioned the guarantees of security and protection of rights that El Salvador can offer, when it is the lack of such guarantees that is driving the emigration of Salvadorans. Rubén Zamora, El Salvador's former ambassador to the UN, criticised the fact that Bukele was conceding a great deal to the United States, with hardly anything in return.

Bukele, however, was able to showcase a US counterpart in October: the extension for one year, until January 2021, of the Temporary Protected Status (TPS) that provides legal cover for the presence of 250,000 Salvadorans and their families in the US. The total number of Salvadorans residing in the US is at least 1.4 million, the largest number of Latin American migrants after Mexicans. This sample shows the strong link between the Central American nation, home to 6.5 million people, and the great power of the North, which is also the destination of 80% of its exports and whose dollar is the currency used in El Salvador.

The new Salvadoran president appeared to cut short this harmony with Washington in December, when he made an official trip to Beijing and met with the Chinese leader, Xi Jinping. The US had warned of the risk of China taking strategic advantage of the door that was opening in Central America with the successive establishment of diplomatic relations with the countries of the American isthmus, which until a few years ago were a stronghold of support for Taiwan. In particular, the US embassy in El Salvador had been particularly active in denouncing the Sánchez Cerén government's alleged efforts to grant China the management of the Port of La Unión, in the Gulf of Fonseca, which could be joined by a special economic zone.

However, what Bukele did on this trip was to resize, at least for the time being, this relationship with China, limiting expectations and calming US suspicions. Not only does the question of the port of La Unión seem to have been shelved, but the Salvadoran president also confined China's attendance to the realm of financial aid at development and not to the granting of credits which, in the event of non-payment, condition national sovereignty. Bukele specified that the "gigantic cooperation" promised by China was "non-refundable" and referred to typical international cooperation projects, such as the construction of a Library Services, a sports stadium and a sewage treatment plant to clean the sewage discharged into Lake Ilopango, near the capital.

The port of Chancay, at position of the state shipping company Cosco, will be operational in 2022.

The Chinese pronounce it almost like Shanghai, but it is not in China but in Peru. The port of Chancay, 75 kilometres from Lima, is to become the first Chinese logistics hub for the Pacific side of Latin America. It is the only port in the region for the state shipping company Cosco, which once established its European gateway in Piraeus entrance and is now preparing its access of goods to South America via Chancay. The infrastructure represents an investment of 3 billion dollars.

Computer design of the facilities of the new port of Chancay, 75 kilometres north of Lima [Volcan].

article / Gabriela Pajuelo

The port of Chancay aims to become one of China's main connections with the countries on the west coast of South America, serving as a bridge for the growing trade in goods from this region to Asia-Pacific. Through the company Terminales Portuarios Chancay, China's Cosco Shipping Ports is contemplating an initial investment of 1.2 billion dollars for the first phase of project - construction of new dykes to gain ground to the sea, achieving a greater depth (16 metres) and surface area for operations (one million containers). The total investment will be USD 3 billion; the entrance is expected to be operational by 2022.

Since 2014, China has been Peru's leading trade partner partner , replacing the United States. In 2017, China was the destination of 26% of Peru's exports (11.7 billion dollars) and the origin of 23% of its imports (8.75 billion). Chinese interest is focused on minerals, the largest Peruvian export sector, and therefore the port of Chancay is emerging as the main exit point for these raw materials to China. Return freight will bring Chinese manufactures, not only to Peru but also to neighbouring countries.

Beijing's interest in Peru's raw materials has already led to a free trade agreement between the two countries in 2009, which was improved last year, signature . It is a relationship that has not been complicated by the granting of large loans that the recipient country then finds difficult to refund: Peru has only received loans from Chinese public lenders to the value of 50 million dollars in 2009, which places it at the bottom of the list of recipients of Chinese loans in Latin America.

Cosco took over 60% of Terminales Portuarios Chancay for $225 million in the first half of 2019, sharing a partnership with Peruvian miner Volcan, which owns the remaining 40%. This is the first port that the large Chinese state-owned shipping company will control in its entirety in the Western Hemisphere, as its presence in the port of Seattle, in the USA, is limited to the operation of one terminal. Cosco has 34 terminals worldwide, 11 of which are outside China (in Spain it has a presence in the ports of Valencia and Bilbao). Other Chinese companies also have a terminal in the region, such as in the mouths of the Panama Canal (China is the second most important Username of this inter-oceanic waterway, after the USA), or are involved in port expansion works, such as in Itaqui (Brazil). Beijing has also expressed interest in managing entire ports - the case of La Unión in El Salvador -but Chancay is the first realisation in this sense.

The new port of Chancay, almost 1,000 hectares in size, will include an entrance complex, an underground viaduct tunnel and an operational port area. This will have a container terminal with two berths, and a bulk, general cargo and roll-on/roll-off terminal with two additional berths. According to the company, the port will reach an annual cargo handling capacity of one million TEU (Twenty-foot Equivalent Unit). It should be added that the port complex will have the capacity to unload Triple E vessels, considered the second largest container ships in the world.

The multi-port is located 75 km north of Lima and will be connected to the centre of the country via a road to Oyón and Ambo, in the Peruvian Andes. This road infrastructure, with a public investment of 450 million dollars, represents a decentralisation effort on the part of the Peruvian government.

The port of Chancay could pose a serious challenge skill to the Callao Port Terminal, managed by DP World Callao (business subsidiary of Dubai Ports World), APM Terminals and Transportadora Callao. This is the de facto port of Lima and is the country's main port in terms of traffic and storage capacity, with a port movement in 2018 of 2.3 million TEUs and 56 million tonnes, representing 51% of the national total.

Cosco Shipping Ports terminals worldwide [Cosco Group].

The Minister of Transport and Communications, María Jara Risco, has announced a plan to double the storage capacity of the port of Callao, but there are questions as to whether this will be enough to compete with the new port of Chancay. The President, Martin Vizcarra, sample is convinced that the two facilities can work in a complementary way, and that the new infrastructure will help to decongest the lorry traffic at the capital's area .

Chinese investment, however, has given rise in some quarters to talk of "chequebook diplomacy", a concept that refers to the use of investments or loans to establish favourable relations with countries occupying strategic positions in regions of geopolitical interest. While infrastructure such as Chancay is highly interesting for the recipient country, it may be obliged to refund in other ways, perhaps by allowing the exploitation of mineral resources. Apart from that, there are internal Chinese regulations, which oblige their companies with port terminals in the rest of the world to host the navy if necessary.

China's growing influence in the Western Hemisphere worries the US. Its own vice-president, Mike Pence, warned Latin American countries that these investments represent a potential threat, because at the very least they establish an excessive dependence on trade and credit ties with China, generating a high trade deficit and high debt. They may also, according to Pence, negatively affect issues such as environmental protection and respect for protected areas. 

The Pentagon has spoken in more dramatic terms. In February 2019, Admiral Craig Faller, head of the Southern Command, warned that in the future "China could use its control of deep-water ports in the Western Hemisphere to increase its global operational position".