Latin America's Moment in Global Chaos

0:03Jacob Shapiro Hello listeners.

0:04 Welcome to another episode of the Jacob Shapiro podcast. Uh huh. Like that deep sigh. It has been a busy week. I'm sure it's been a week for all of you as well. Uh, I'm happy to welcome Fado Robles onto the podcast. He is the program coordinator at the Wilson Center's Latin America Program, uh, at the Wilson Center's Argentina Project.

0:24 Also wears a number of other hats. Professor at, uh, uh, national Defense University in Argentina. He. He goes through all his credentials at the end of the episode. We've been trying to get together for weeks, months now, and our schedules just kept misaligning, but he, we were finally able to get him on.

0:37 Um, there's two things I wanna say before we get to the meat of the episode. The first is that I worry that the Israel, Iran War is crowding out the fact that developments are happening everywhere around the world. Um, it's already hard to get information, but when you think about how everything now is focused on the very, very important things happening in the Middle East, the, the rest of the world still spins.

0:57 So part of me thought, ah, we shouldn't do this podcast primarily on Latin America. We should be focusing on nothing but Israel Rome. But then I took a step back and said, actually, no, like it's really important to keep your finger, um, on the pulse of what's going on in the rest of the world, even as this craziness is happening in the Middle East.

1:13 And then even so, I Kudo did an amazing job taking what's happening in the Middle East and saying, no, it really does matter. To Latin America and to South America in general, and the decisions that President Trump makes will affect everything from elections in South America to how South American countries are gonna align.

1:30 Maybe it affects the calculations of Nicholas Maduro and the regime in Venezuela. I would be. Absolutely terrified if I was them looking at the precedent that Israel has set, uh, in bombing Iran. I mean, lots of terrifying things there. Um, so we were, we were initially gonna try and just talk about Latin America and then maybe push this episode out in a week or two when things calm down, but we're not gonna do that.

1:49 We're gonna push it out as quick as possible. Um. I've been very busy this week. If you have not signed up for my substack, I'm putting out analysis very, very often on Substack, it's, I, I've, I'm using the Substack really as the place where my first drafts are going. So as I'm trying to get things out of my fingertips before they go to my clients, I'm getting very rough drafts there.

2:09 It's free, uh. You can find it online if you just, uh, search Jacob Shapiro and Substack. So it's there if, if you want those types of written thoughts. Um, we're pumping out content on this podcast. And then also cousin Marco and I on the Geopolitical Cousins podcast feed, uh, pumping out content, actually recording with him a couple hours after I, I hit stop on this recording.

2:27 So, and it's not gonna stop anytime soon. And we'll, we'll keep trying to get as much content as we can out to you. Obviously I also have clients and a family and everything else, but, um. I find that moments like these, um, are the moments where providing sober, well sourced access to a minimum amount of information that we have is, is super important because for whatever reason, the way our media ecosystem works, like it's just not, it's not delivering that.

2:52 It, it's a lot of hard work to sort through all of this and, and get some sense of truth on what's happening now and then a sense of what this, uh, what this could all mean and where we're going from here. Um. You can email me at jacob@jacobshapiro.com if you wanna talk about any of the things that you've heard on this podcast, anything going on in the world.

3:09 Otherwise, take care of the people that you love. It's crazy out there. Cheers and see you there. Kudo. First of all, it's nice to meet you. We've been trying to put this together for a while. Schedules were difficult. I also have to tell you, I had not. Seen you face to face before it's incredibly disorienting for me.

3:27 You look exactly. I mean, like, exactly like my college roommate. I feel like I'm talking to Elias, who is probably listening to this podcast right now. Like the glasses, the beard, the hair, like, like the matcha. It's like literally I'm talking to my college roommate. Uh, so it's nice to see you man.

3:42Facundo Robles No, it, it is nice to see you.

3:43 Hi. Hi Jacob. Thank for, thank for having me. Um, I know so well on, on my end first. First of all, I, I really appreciate doing this on a holiday, this Juneteenth in the US so I know many people are off today and I'm, I'm grateful for your time.

3:59Jacob Shapiro Uh, right back at you.

4:00 So, um, well, let's dive in. I know that you prepped some, some thoughts about the effect of the Israel Iran War on what is happening in the Middle East. We're recording, as he said, on Juneteenth. It's 8:48 AM central here. I. Even if we get this up like 12 hours later, who knows? Like many things could have changed at this point.

4:18 So, you know, if you're listening and anything seems overtaken by events, hey, this was a nice, uh, snapshot from this particular moment. Uh, before I, before I ask you about some of, to develop those thoughts about the impact of the war, um, on Latin America, I actually, the, the first question I wanted to start with, with you was that to me, um, Latin America and specifically South America seems divorced from the chaos of Eurasia.

4:40 I mean, Eurasia. You know, you've got the Russia, Ukraine War going. We've got India and Pakistan at each other's throats. Now we've got Israel and Iran striking each other. North Korea is still sitting up there doing their crazy, like you start looking around Eurasia, like there's basically conflict everywhere.

4:55 And that's not to say there isn't conflict in Latin America. There's obviously narco terrorism and the. Conflicts between sort of cartels and, and governments and all sorts of political populist issues and issues of democratic transition from Peru to Argentina to Mexico, everywhere else. But it's, it's qualitatively different.

5:14 We're not talking about state on State War in Latin America. We're not talking about nuclear proliferation. We're not talking about, you know. Potentially hundreds of thousands of dead and like all these sorts of things being realigned. So I, I guess just, you know, from somebody who is sitting in Buenos Aires who is sitting about the, who is sitting in the region, do you look out at the region and suddenly it's like, yeah, like we're pretty good.

5:34 Like maybe we have our problems, but this is the place to be. This is the future. 'cause we have. Cheap energy resources and we have cheap food resources and we are far away from all these crazy people who seem obsessed with, you know, bombing each other into the previous century. So I just take that any direction you want.

5:48 You can take that right into your thoughts as well. But I'm, I'm struck by the stability of Latin America and South America compared to the rest of the world, which that comment in and of itself is kind of remarkable.

6:00Facundo Robles Oh, Jacob.

6:00 I think that's one of the most interesting points regarding the, the region. And in fact, when, when talking about Latin American international relations, that's one of the things that first, uh, comes up, um, Latin America, even though it's very difficult to talk about it as one block because it's a very like heterogeneous, uh, region, each country has its own particular dynamic.

6:23 Um. And it's very difficult to talk about Latin America going in one uh, direction. You can see trends, but not one direction. Um, having said that, Latin America is characterized by being a peaceful region. As you said, there's no like state of state wars. You have internal, you have domestic issues, really important issues.

6:47 And also you have, uh, in the continent, you have the United States. Being like the heman of the region, uh, historically over the last centuries controlling, uh, the region of being the main character there. Of course you had some other countries trying to question that, trying to be, uh, the main characters of it.

7:09 You see China challenging disposition mainly on trade and investments, but. It's been always there. The United States, you can see the Monroe Doctrine. Uh, there's been an influence, a direct influence of the United States. We don't have that many variety of voices coming from out the region. Mm-hmm.

7:31 You have some, let's say, marginal voices, some actors that are coming, um, some countries that have agreements. Formal or informal agreements with different countries like Russia, Iran, uh, China, Europe as a European Union, but it's very difficult to see that you have more a different country rather than us having influence.

8:09 Having said that, you also have. Very, the region has been historically challenged by its own military coups. Um, each country has, or the, in the 20th century, been marked by extremely violent military coups, and that has been that, that has also questioned the role of the defense. Sector in the, in the region, having countries that they don't even have any sort of armed forces, um, like Costa Rica for example.

8:47 Mm-hmm. Uh, so you can see that the role of the military is also extremely weak in Latin America. And you can see that there is different ways which we. Create problems, um, regarding the nuclear per proliferation. It's very interesting to see the plate agreement in which countries of Latin America have agreed not to, not to get involved, uh, in that.

9:14 Uh, and that's in fact one of the most, yeah, clear examples of how the region can work. On one, same direction, however, I must say is the exception, not the, not the rule.

9:29Jacob Shapiro Mm-hmm.

9:31 Makes sense. Um, well let's dive into to some of the thoughts that I know that you prepared. So how do you think that the, the war is going to affect, um, different countries in the region and, and take it wherever you wanna start?

9:44Facundo Robles Well, um.

9:46 Being very, uh, upfront, I'm not here to offer expert analysis on the developments unfolding minute by minute in the, in the Middle East, as you, as you mentioned, is really important. To clarify the date and time of this, as a lot of things are changing, um, there are people far more qualified, uh, than me for, for doing that.

10:04 In fact. As a recommendation, if you're looking for a great breakdown of what's happening in the, in the region that we recommend, uh, there was one of the Carnegie Connects is a podcast from the Carnegie Endowment yesterday between Sima Shine and Alibis, moderated by the great, uh, Aaron David Miller, which is in encrypt.

10:23 Mm-hmm. Incredibly helpful. Um, but shifting gears a bit, and this is where I hope, uh, I can add some, some value. Thinking of what does all of this mean for Latin America? Um, if we start thinking of this country by country, we'll see different consequences. But as the region, we have some markets in common, so.

10:51 Since the escalation began, the brand crude has gone up more than 8%, right? Reflecting the, the mounting risk premium attached to, to the Middle East Volatility. Um, according to analysts from institutions such as Goldman Sachs, Barclays, uh, energy intelligence, the current price movement could just be the, the beginning.

11:13 And in fact, some experts suggest that depending on how the conflict DeVol. Particularly if the United States becomes directly involved or, or if there's a disruption in oil flows through the straight up, the price of oil could rise significantly further. That kind of spike doesn't just affect all producers and consumers.

11:35 It sent ripple effects, of course, through other markets too, including agriculture, where Latin America plays a significant, uh, role. For example, if you take soybean oil, the July, 2025 contract in Chicago went up 1% in a week and March, 2026, up almost 2%. Uh, these are based countries like Argentina, Brazil, who are big exporters, but also Peru and Chile, who import a lot of.

11:58 They're food imports and also you have the fertilizer. Iran is a major player in nitrogen based fertilizers, and Israel exports a lot of potassium chloride. And so disruptions in supply from either country, heat, farmers across Latin America almost immediately. Um, if we break it down country by country, um, giving like a brief, a brief like domestic.

12:26 Uh, diagnosis and then going to the most geopolitical side of this, um, in Mexico, you have President Shane beginning her administration in October, 2024. Her president marked a, a continuation of AMLO populist agenda about a more pragmatic and technocratic tone. In early 2025, the Mexican Congress approved sweeping judicial reforms that replaced all city members of the judiciary through direct elections.

12:56 This, this move broke not only with Mexicans, but also with westerns traditional model of checks and balances, um, and has drawn widespread criticism for undermining, uh, judicial independence. Geopolitical in Mexico remains at the center of the North American vulnerability. It's it's proximity to the United States, and deep integration into continental supply chains means that any significant escalation in Middle East, such as disruptions in energy or global shipping, directly affects Mexico's energy, security, investment flows, macroeconomic stability, energy prices, and logistics.

13:34 Volatility will be felt first, of course. Um. The mission most strongly in Mexico, particularly in the automotive and agricultural, uh, sectors, where you have the just in time supply models that are already strict. Um, moreover, you have Mexico being part of the U-S-M-C-A, uh, and disagreement has been.

14:00 Mexico has seen the agreements mechanism tested repeatedly, particularly on labor enforcement, energy policy, environmental rules. The U-S-M-C-A is officially scheduled for review in 2026, but negotiations have been pushed forward and early discussions are set to beginning late 2025, following pressure from the United States, particularly from President Trump who used the agreement as tool.

14:24 Let's call it tolerant, uh, and has signaled interesting tightening rules on outs, steel and fresh shipment from China. Um, Mexico is trying to prepare for this review through a government led dialogue with business leaders and US stakeholders. Um, however, having the confluence of the judicial reforms, investor uncertainty, tariff threats, uh, all of these has already taken a toll.

14:52 Um. Uh, the Mexico Central Bank has stated that the foreign direct investment, the FDI dropped 21% in the first quarter of 2025. And the economy is expected to grow by just 0.1% this year. In all this context, and knowing what is happening in the Middle East, Pemex may see some relief, uh, from the higher global oil.

15:16 Oil prices, but the broader Mexican economy remains vulnerable to inflationary pressure, pace of volatility, um, shift in political wings in Washington. Of course, if the conflict in Middle East expands Mexico would find itself economically exposed and politically constrained. At the very moment he is being asked to.

15:40 Story, you can renegotiate the future of its most important, uh, trade relationship. So it's very really important to take a, take a look, a very close look at what's happening in Mexico and what will happen in Mexico for the, for the next couple of months.

15:57Jacob Shapiro Um,

15:58Facundo Robles if you want, we can, we can keep working on, uh,

16:01 country by country if as you wish.

16:04Jacob Shapiro Yeah.

16:04 No, because I mean it's, and, and there's part of me that wants to understand the impact of the war on Latin America, and also part of me that thinks that the war itself is crowding out. Important developments and we'll continue to crowd out important developments in the weeks and months ahead. Um, because as you said with Mexico, Mexico is undergoing fundamental transitions here, and I'm not sure what the future of Mexican democracy looks like.

16:26 Uh, Claudia Shane Baum seems relatively pragmatic to me. Um, but once she goes, what's going to replace her? Like, Marna looks like it's becoming the pre and we're not always gonna have a pragmatic person at the top who is willing to limit herself in some way. Uh, Peru looks like an absolute dumpster fire.

16:43 If we're talking about democracy, well, we look like we're transitioning between authoritarianism and chaos. It seems like Peruvian democracy's dying a slow death. Um, you've got the example of El Salvador sitting there, which makes anyone with a moral center uncomfortable. But you also can't deny that El Salvador is.

17:00 Orders of magnitude, more peaceful, more stable, more economically prosperous than it was, than when bouquet started. So it's hard to argue with results. Um, and then, you know, you've got Argentina, you're down there in Buenos Aires. We've got the, the, the chainsaw wielding maniac. We've got Lula in Brazil where he's sort of cannibalized the left.

17:18 Um, to a sense, it seems to me that le the left has become Lula and that eventually Lula will exit stage left, and then it's just the center right in Brazil going forward. Brazil also a country where the military plays a bigger role, so, um. I know I rambled a little bit there, but I mean, those are at least some of the countries that, that are at the top of my mind.

17:34 So I'm curious if that's your list as well, or if there are others that we should be thinking about or maybe which country on that list do you think is most instructive for us to talk about?

17:42Facundo Robles Let's go.

17:43 You, you said a lot of things extremely interesting and, and serious things. Um, on top of that, we also have a lot of elections happening this year and the next, that will change also this trend in the. In the region as you being extremely simplistic in saying the left and the right. Mm-hmm. You can see some of the governments of the left of the continent, uh, potentially moving to the right in the next elections.

18:13 And we are talking about Chile, ver Brazil, Colombia mainly. Um, going into each of these, I will start with, um, Argentina first, which I think is a very serious. Country, uh, knowing what is happening, injury in Middle East, but also what have happened, uh, in that country before President Javier Millet was in Israel at the time that the, that the attacks, uh, to the nuclear facilities in Iran started, uh, in fact, it was there that he announced the relocation of Argentina's Embassy from Tel Aviv to.

18:55 It was just ours before Israel strike. Um, and that was a big shift in Argentina's foreign policy. It brought the country much closer to Israel and the us. Uh, although rhetorically, Malay had already stated that, and it really brought with its long standing tradition of neutrality in the region. And it's important because this, the implications are twofold on the one hand.

19:21 This strengthens ties with powerful allies, but on the other in may increase Argentina's exposure to international terrorists especially, especially given its tragic history. On Mar on March 17th, 1982, the Israeli embassy was bond in Bueno Aires, killing 22 people on July 18th, 1994. Uh, the amia, which is the, the Argentine Israelite Mutual Association, was bond in Buenos Aires as well, killing 85 people.

19:52 Uh, and in fact, the latter was one of the deadliest anti-America vaccines to World War ii. Mm-hmm. Both were linked to Hezbollah and Iran. Iran has a history of using proxy war to strike targets abroad. So Argentina is once again on alert. Um, the relocation of the embassy combined with Malays high profile embrace of Israeli leadership could play the country in the, in the cross.

20:15 Her and my national intelligence and culture terror capability have improved significantly since the nineties. Attacks by nonstate actors often require minimal infrastructure, eh, making them really hard to, to prevent. In the energy sector, Argentina stands to benefit, let's say, uh, from a high global oil and LNG prices due to its past back mortar reserve.

20:38 Uh, and also ARG D is planning to expand the LNG export infrastructure. However, it still relies heavily on importing, uh, refined fuels and price volatility could disrupt domestic consumptions, uh, and logistics. And this is really important. Regarding Lee's point of view, because when he took office in December, 2023, monthly inflation was 25%.

21:04 Monthly inflation mm-hmm. Was 25% last week. The May, 2025 figure came, um, at 1.5%. A dramatic turnaround, of course, for it. Regular or developed country, this would mean, uh, still a very high inflation. But for Argentina standards, this is a huge success. If Millane maintains this trajectory alongside the national public organization being laid by his sister, Karenina, mille and sustains strong communication, communication and agenda setting.

21:40 As he's been doing for the last couple of months, this will boost his chances in October, 2025 midterm elections. Mm-hmm. And the outcome of those elections are essential, formulaes, broader vision of transforming Argentina in a more market oriented, uh, but at the same time for the United States, having one of its closest allies in the region.

22:04 Um, and the Argentina case is a very, it would be used as a case study. To see how Donald Trump is treating a country that has taken a 180 degree turn around, uh, and is being extremely, uh, in favor of your country. He's going, he is going, is Trump going to favor Argentina and Malay? Uh, given this orientation or it's gonna remain indifferent.

22:32 Mm-hmm. Well, that would be a huge signal for the rest of the countries, um, aligning in the middle of these, uh, elections that we are, that we're talking about.

22:44Jacob Shapiro Whi which direction do you think that he'll go?

22:46 I mean, I melee and, uh, Elon Musk were famously swinging chainsaws around together and Elon's on the outs now. So does that mean that, uh, and there's also, I dunno if you've noticed this from Argentina, um, but I. There's, there's very much a division within Trump's base. It feels like over the Iran war.

23:02 You have, you know, your Steve Bannons and Tucker Carlsons and your Elon's out there lamenting us fiscal prophecy, talking about how the neocons have hijacked Trump and they're starting this big war. And then you've got, you know, the, the other stalwarts that are still there. And it's hard for me to sort of calibrate how much are in one camp and how much are in another, and how much political pressure is that gonna put on on President Trump.

23:23 But. Do, do you think that President Trump will respond to Melay in that way, or do you think he'll just be, 'cause I mean, we're talk, we talked about Israel and Iran. Israel was the country that said, fine, no tariffs whatsoever, and we'll do whatever you want. And President Trump didn't care about that.

23:37 All he wanted to do is go to Saudi Arabia and sign AI semiconductor deals like two months ago. So I'll, I'll put you on the spot, like, which direction do you think it'll go?

23:47Facundo Robles A couple of thoughts.

23:49 The first is. Some of the last presidents of the United States have stated, uh, during the campaign or at, at the first couple of months of their presidency that Latin America was, uh, the region that they were really interested in. And of course then things happen. Uh, you have a more, more urgent, uh, needs somewhere else, particularly Middle East for the last, uh, decades.

24:19 Um, but Europe as well, Asia as well. Uh, so Latin America, and going back to the first reflection that you were making, given that it's inter regionally peaceful, uh, is not usually, uh, an urgent matter for the, for the US for the first couple of months. In this second Trump administration, there were signs that maybe this time Latin America was going to be more relevant, uh, particularly given the role of China in Latin America's economy, given the role of a migration for the President's campaign, uh, and also given the security matter, uh, with drug trafficking and, and stuff.

25:13 Now what is happening in the Middle East? We change all of that. Those priorities change. Of course. I think that on the Latin American side, you will have to analyze each of the presidents talking about Argentina. Malay, even though a lot of people has claimed him to be extremely dogmatic, he has shown himself as.

25:39 Really, really pragmatic. Uh, and in fact, you can see that now, for example, during his inauguration, uh, president Zelensky was in Argentina, was there presence? Mm-hmm. Sitting in the first row. Uh, after the, the encounter between President Trump Zelensky, uh, in Washington, millet remained quiet.

26:09 He didn't say anything, and it is the same thing he's doing right now. Of course, he was in Israel. He claimed or he announced the move for from of the embassy, and by itself that means a lot, but he remains quiet. In fact, even with domestic issues, he's remaining quiet. Uh, and I think he is, that displays the most pragmatical side that he has.

26:39 He knows when to talk, when to shout, but also he knows when to listen and when to wait. Um, regarding the whole Elon Musk, Donald Trump side, I think the pragmatic side of Malay will also be displayed on that arena. Um. In the short term, he will have to be closer to Donald Trump, of course. Uh, but in the long term, we will see how the relationship between Elon Musk and, and millet, uh, moves forward, particularly knowing that Argentina needs, uh, hard currency, he needs foreign direct investment.

27:22 And there was conversations starting, uh, of maybe. In the best dreams of the current Argentine administration, having a Tesla factory here knowing that we have, we are part of the lithium triangle, uh mm-hmm. With Bolivia and Chile, and we should analyze each of the countries, how they will, how they will move with, um, the United States.

27:49 But from a, from an American point of view, I think it will, uh, everything will move now to the Middle East. Uh, there are more urgent priorities happening right now. Um, Malay is still an ally, a very close ally, and it will be used that relationship as an example for different countries to move on that same direction.

28:16 You have extremely important elections happening, this happening this year, and we already had. Uh, for example, in Ecuador. Uh, in Ecuador, you have President Noboa originally elected in 2023 through a, through a snap election, triggered by the cross death Dete Sada mechanism that dissolved Congress under lasso president lasso.

28:39 But he was reelected, eh, this year with a full constitutional method, and now his term ends or extends until 2029. Um. Novoa is governing a country under siege from organized crime and economic fragility as well. Even though the country is not actively renegotiated a major IMF program, it still remains highly vulnerable to market pressures.

29:05 Uh, and equality is clearly looking for support from the United States. So that's another country to take a, to take a look. Um, and of course talking about. The consequences of oil prices and the relationship and what the region with Iran and the region or the US and the region, we can. Talk about Venezuela.

29:30Jacob Shapiro Yeah, we could talk.

29:32 I mean, I'm, I'm conscious of, of the time 'cause I know you're just gonna have to agree to come back on 'cause we're not gonna be able to, to cover all of it. But, um, I, I guess the, the first question I have down that line of thinking though, 'cause you're talking about the sort of, from the, from the region's perspective, the focus on the Middle East, that, at least on the surface to me, sounds like an incredible opportunity for China.

29:52 Maybe not so much so for Russia because they're bogged down in Ukraine. But if China was looking for a vacuum of power to insert itself in, I mean, that seems like a prime place. You were mentioning, you know, Mar, secretary of State, Marco Rubio. Was saying the things you said about how we're gonna focus on the Western Hemisphere, we're gonna focus on Latin America.

30:08 Panama was, I believe, the first place that he visited and now that is sort of all, uh, overturned. So do you think it creates an opportunity for China, I guess is the first part of the question. And then the second question is, and I know this might be a way to back end to some of the particular politics that you're talking about, um.

30:25 Is there any sense that South America itself, and I mean Latin America more broadly, but I'm thinking this is more realistic in a South American context, where we will see more regional integration, where we will see sort of South American powers like cooperating and operating on the world stage that way?

30:42 Or do we get another version? Of soft imperialism where no, no, no. Like Brazil will have relations with China and the US will have good relations with Argentina and you know, Peru will be up for grabs. I'm, I'm like, you know, uh, pulling things out of thin air to make a point there. Um, do you think there's any sense that no, like South America actually could be a source of great prosperity and wealth and it could say no, if you don't play along with us, we're not gonna send you our soybeans, or we're not gonna send you the lithium and the lithium triangle and you need to invest here in order to build things.

31:10 And we don't care whether it's the United States or, or China. So. However you wanna tackle that.

31:16Facundo Robles Regarding the first part of the question, um, I would think that

31:22 it provides an opportunity, uh, for China. It is really important to clarify one thing that, and I could see, I was able to see this, uh, with my own eyes. And I was able to listen to this with my own years, through this past couple of years living in Washington and now spending the, the summer in, in Argentina.

31:49 There's a very asymmetric way of thinking international relations, um, from the United States and from South America. The United States is clearly. Concerned about the role of China migration and security. As I mentioned before, while the region, the region is clearly, um, concerned about some countries, inflation, some countries their own security, some countries need money, need investments, need infrastructure, need, even really, really basic stuff.

32:34 There's a, a famous saying that, uh, by some officials from Latin America in, in DC that they say that when, when a chin, when, when a US official come to the office, they leave the meeting with a lecture on democracy, but when the Chinese official has a meeting with them, they leave that meeting with a new airport.

33:01 Mm-hmm. So the Chinese ha have that leverage, even though you can see that that trend is, uh, going down compared to what it used to be in the first, uh, at the first phase, let's say, of the Belt and Road Initiative is still a major, uh, actor. And what, what could happen to United States that it will redistribute their resources to the Middle East if they get involved.

33:29 Uh, directly or indirectly, uh, we will have to see what happens with NATO and Russia. Uh, we'll have, we'll see what happens between India and Pakistan. And you mentioned mm-hmm. Uh, between North and South Korea. Um, but one of the most important things to understand this from an American perspective is that Latin America doesn't see China as the enemy.

33:59 China has a huge advantage in Latin America compared to United States, is that we don't have history together with the United States. We have history, and the last century has been pretty tough, let's say, to put it lightly. Yeah. So you have, from a Latin American perspective. You have the country that was involved in some of the most outrageous, um, events happening in the last century, coming to you now and telling you, remember, we share values while at the same time you have a country investing a lot coming here, not asking for much in return at, at least at first, and in a region that has.

34:52 An amount of needs for basic stuff. Again, basic stuff. Um, China has been using that leverage. Um, I think what it should be important, uh, right now, especially in the US administration, is the role of officials that understand the relevance of the region. Politically, ideologically and economically.

35:24 Um, secretary Rubio is one of those. So the amount of pressure that they're gonna be able to put in remembering that you have below you a whole region, uh, is gonna, is gonna be really important. It's gonna be really, really important. Um, and then the second part of the question was regarding regional integration.

35:50 What I was telling you, uh, at the beginning of the conversation, that Latin America is usually started as a, as one block, and we say US Latin America relations, thinking that it's a bilateral relation, um, you can, you can easily fell into mistakes, uh, because today, Argentina, for example, has Malay as the president.

36:18 But two years before we had Alberto Fernandez as president, it was the extreme opposite of that. And what can prevent the opposite of millet coming in three years? Nothing. What happens if after Petro in Colombia, you have a far right candidate, nothing. Mm-hmm. So all of these, like these swings is very.

36:47 Makes very difficult for the region to have a regional integration in the long term. Speaking of course, you can see some, uh, attempts of this with the medical student and the European Union where the European Union, when talking about who can take advantage of the US taking all of the resources and attention to the Middle East today.

37:08 The European Union can also. Use this vacuum, as you said, uh, in the region. And the e um, European Union MER agreement could be an example of that. And it's really interesting to see the role of, or the relationship between Lula and Malay in Mercosur today. Um, because you also have Uruguay. Uruguay today is much closer to tall Lula.

37:37 The president's really closer to to doula, and that all can shift really, really fast and very drastically. Uh, so it's really difficult to talk about regional integration, at least is one of the things that I wish the most. But being realistic is one of the most difficult things, uh, today and has been one of the most difficult things for the past couple of decades.

38:04Jacob Shapiro Yeah, I know, and I know that in asking it, it's like I'm

38:06 having a, a Oliva and Fever dream. Uh, and you know, everybody's wanted it, but it does seem like there's a geopolitical imperative maybe that wasn't there before. And it doesn't have to be political integration. Um, like what is stopping South America or South American countries from saying, okay, let's put aside the ideology.

38:22 Why can't we just have a, have a NAFTA for just South America? Because if we could just trade with each other more freely and not just be a place where, you know, China for, I'm glad that China's investing in South America, that's great, but China basically wants commodities. Like, they're basically like treating it like an imperialistic relationship.

38:39 So, okay, you get some money and we take out all of your commodities and if you say nice things about Taiwan will cut off the investment flows and will be mean to you. And we'll do things like that. So it, it seems to me that, you know, if the United States looks weaker maybe than it has. Towards the region in 50, 60 years.

38:56 China is far away, so can't exert itself, but you want some leverage in negotiating with them. You've got, you know, Europe and other parts of the world that are interested in the region for lots of different commodities. Just it feels like. To your point, no matter where you are ideologically on the spectrum like Lula and Melee and Boule and Shane, they should all agree that, hey, we should be trading more with each other.

39:16 Like if, if the United States is gonna be protectionist and the EU is gonna be protectionist, shouldn't we trade with ourselves and not just send our commodities cheaply to the rest of the world? Because in some sense, the structural problems that Latin America faces is precisely because, you know, the imperial powers invest a bunch of money when they need the resources, and then when they don't need the resources anymore, or when you get the inevitable boom and bust cycles in the commodities, they take their money away.

39:39 And then you get these big cities that don't make any sense in countrysides that are completely underdeveloped. So, I don't know. I, I get that it's completely unrealistic, but, and it hasn't happened for hundreds of years despite people pushing for it. But there's never been more logic, I think, for at least some kind of minimal trade integration.

39:56Facundo Robles I agree with you.

39:57 Uh, however, I must say that, uh, analysts usually, and we, analysts usually, uh, fell into this mistake of thinking or wishing, uh, that this could happen, um, as if it were easy. Uh, however, we must remember that when we are proposing or analyzing or recommending this sort of agreements, c. Uh, we are thinking of it unilaterally is the coalition that I am proposing that Fado is proposing.

40:32 Uh, but it's really difficult when you have different interests, domestic and foreign interests clashing between two countries that are ideologically opposite. And also knowing that you have a country, country A and country B, let's assume that they're opposites. Ideologically you have. The population supporting that president at the time?

40:55 Maybe not. Maybe it's like Peru. But one of the things that I want to, one of the things that I want to, to, to make clear out, out of this and thinking, uh, like the big picture with all that is happening in, in the Middle East, um. I see this crisis as a reminder that Latin America is not isolated from, from global events.

41:18 Um, I generally believe that this is a region that matters for energy, food, minerals. Yeah. And even strategy, uh, countries that can stay institutionally strong, keep their foreign policy clear and protect their autonomy. We, as you are talking about the imperialistic. Because protecting their, their autonomy will have a better shot at navigating what comes next.

41:47 Uh, those that remain fragmented or overly dependent, risk being caught in the crossfire of, of bigger players. And I think that in the next few months, we will see whether Latin America can step into this global moment with more agency, uh, or whether it gets pulled along with forces that it can't control.

42:11Jacob Shapiro I know we're, we're, um, running up on time

42:13 and I know we've probably only just scratched the surface here. So first of all, I hope that, that you'll come back on, but I want to give you the final word. So, you know, we've talked, we've talked on very broad strokes about some very high level concepts. Um, and hopefully we can drill down more in the future.

42:26 But what's the one thing, um, or the one country or, or the one insight that we haven't talked about that you wanna leave the listeners with and, and, and, and wanting for more so that they'll come back and listen to us the next time we get a chance to chat?

42:40Facundo Robles I will go with a country that we haven't spoken

42:44 about, uh, and that is Venezuela. It will be very brief. Uh, but Venezuela held presidential legislative elections the past year. Both were fraud elections, Maduro claimed victory. Again, the process was widely condemned. Then in early this year, 2025, they did something pretty provocative, eh? In the legislative elections, they elected the governor for the disputed VO region, which Venezuela claims, bad Guyana controls.

43:21 Mm-hmm. Uh, and that move added fuel to a longstanding territorial conflict because of all of these before the elections, the US Reimposed sanctions in April, including revoking Chevron's licenses. But now with oil prices surgeon. Venezuela still getting more revenue or wiggles will, uh, get more revenue.

43:45 It's a temporary relief for their economy. It also gives Maduro less incentive to reform, but at the same time, we have to see what happens with the oil reserves, uh, globally because the US is clearly seeing Guyana as an investment for them to get oil. Mm-hmm. So we, we, we, it's very interesting to see what will Maduro do with Guyana.

44:08 Knowing what is happening in the Middle East. Uh, moreover, Venezuela states to Iran make it a key actor, uh, to watch especially is the, if the global conflict.

44:22Jacob Shapiro That.

44:22 And also, I mean the, and I've, we've talked about this a lot. I mean, the way that Israel is taking it to Iran is also remarkable. And if you think about Iran, as you know, the state that looks very powerful on paper and bears its teeth and says sort all sorts of threatening things. I mean, Venezuela in some ways has a lot of similarities with Iran.

44:39 And if you're a decision maker. In Brazil or even in Guana. Like I wonder if you look at what Israel is doing to Iran and you say, would it be that hard to do that to Venezuela? I'm sure they don't have an Air Force. I'm sure they don't have air defenses. They certainly don't have a nuclear program. Like if I was Maduro, I would be absolutely terrified by the precedent that is being set by what's happening in the Middle East, and maybe there's not an actor that can take advantage of it.

45:03 Um, but, but man, like, it, it just seems like bad news for Ven. I mean, I, I get that they get like a temporary bump when it comes to oil, but I would be very, very nervous about what happens next year in the context of what's happening in the Middle East.

45:15Facundo Robles If I have to take a guess, because I don't know

45:19 Maduro, um, I can see him as one of those people that don't surrender. Uh, so if following your logic the most. Worried actors should be the people of Venezuela and not Maduro himself.

45:39Jacob Shapiro Hmm.

45:42 Well that is a grim note to end on, but I, I think we'll just have to put it there 'cause we're out of time and hopefully you'll come back on Kudo, thank you so much for taking the time and, and we'll see you soon. Tell the listeners where they can find information about you or your analysis before I let you go.

45:54Facundo Robles Well, thank you Jacob.

45:55 Um. Well, you can see some of my analysis at the, the website of the, the Wilson Center. I'm also a, an adjunct professor at the National Defense University here in Argentina, and also researcher at what is called the sepe. That is the evidence, the policy evidence center at the University of to. We are all working on defense energy matters, geopolitical analysis.

46:23 So yeah.

46:24Jacob Shapiro Perfect.

46:25 Alright. Cheers. Thank you. Thank you so much for listening to the Jacob Shapiro podcast. Uh, this show is produced and edited. By Jacob Mian, and it's in, in many ways, the Jacob Show. Um, if you enjoyed today's episode, please don't forget to subscribe, rate or leave a review. It takes just a couple seconds of your time, but it really helps us also share with a friend if you're interested in learning more about hiring me to speak at your event or if you wanna learn more about the wealth management services that, uh, I offer through bespoke.

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