The Future Cost Of Trump’s ‘America First’ Policy On The Caribbean

By David Jessop

News Americas, LONDON, England, Tues. May 15, 2018: At first sight, last week’s decision by the US President to abrogate the hard-won 2015 UN Security Council deal on nuclear weapons with Iran may seem to have little bearing on the Caribbean.

What it does, however, is take US exceptionalism to a new level. It ignores the interests of the co-signatories to the agreement including Russia and China and close allies in the EU, all of which continue to believe that the agreement represents a viable way of curbing Iran’s nuclear intent. More broadly, it demonstrates to every other state that Washington has abandoned multilateralism and in the singular pursuit of its own objectives will in future ignore previously valued allies.

Speaking about this in Brussels, the President of the European Commission, Jean-Claude Juncker observed that the US decision suggests that the US is turning its back on multilateral relations, “no longer wants to cooperate with other parts of the world” and is doing so “with a ferocity that can only surprise us”.

In moving against Iran, the US Administration has made clear that its policy will be applied in ways that will not only cause US companies to cease doing business there, but through the enforcement of secondary sanctions it will try to halt almost all third country trade with Tehran. Although the full details have yet to emerge, new US regulations will mean for example that EU companies from Airbus to Total engaged in any Iran-related commercial activity will potentially be subject to prosecution in the US courts, as will any bank facilitating related trade or investment decisions.

For Caribbean states other than Cuba, Iran is of little consequence as a trading partner. However, Washington’s ‘America First’ unilateralism may resurface next in a hemispheric context after Venezuela’s May 20th Presidential elections, if as widely expected, President Maduro is re-elected.

Discussions in Lima at the time of the Summit of the Americas and comments made subsequently by Mike Pence, the US Vice President, about the need for Latin American and Caribbean nations to do “more, much more” to impose sanctions on Venezuela, suggest that this is now the administration’s direction of travel.

If that happens, the economic and social consequences for the Caribbean could be severe, particularly if as some in Washington suggest, the US decides to place an embargo on Venezuelan oil exports which account for 95% of the country’s foreign-currency earnings.

In February, the US Council on Foreign Relations spelt out the implications of what this could mean for the region. In its report ‘A Venezuelan Refugee Crisis’, it noted: ‘The United States should consider not only the potential damage and disruption caused to Venezuela’s neighbors by a refugee crisis but also the implications of the crisis for US interests.

The economic, national security, and health costs imposed on the United States by a potential disruption in Venezuelan oil production, an increase in drug trafficking, or an epidemic, respectively, would be substantial. The United States can do little to prevent Venezuela’s further downward spiral. However, it can and should take measures to mitigate the political, economic, and humanitarian consequences of a potential mass emigration’.

For the geographically proximate Caribbean, the practical consequences of a unilateral change in US policy with such an outcome would be catastrophic. There are already three million Venezuelan’s who have felt they have no option other than to become economic refugees in Colombia, Brazil, Trinidad, Guyana and the Dutch speaking Caribbean, and there is little capacity to support more.

This is not to defend what is now happening Venezuela. Although Caracas blames external forces, the private sector and the divided opposition, this long ago ceased to be a plausible excuse for the continuing mismanagement of Venezuela’s vast oil wealth, the mistaken policies that have led to hyperinflation, the decisions that have resulted in hunger, corruption and violence, or the poverty and disease that now afflicts parts of the country.

Notwithstanding, President Maduro makes clear that his position is ideological, and that his government will not negotiate away its revolutionary principles with any nation. Rather, once re-elected he “will call for a great national dialogue for peace”, but how he intends on reviving the country’s collapsing economy or rapidly restoring stability, remains a mystery.

What this suggests is that short of supporting a military-led coup, the US will continue to pressure the Caribbean to engage in transactional politics over new sanctions on Venezuela or suffer the consequences of whatever it decides its post May 20 response will be.

Washington is now seeking a US made world based on unilateral foreign and economic policies that through tariffs, sanctions and dispensations seek to place it in a position of global economic supremacy.

Other nations, including those in the Caribbean, of course think differently and value multilateralism, seeing it as a way of maintaining their independence of thought and action.

Changing US policy suggests that a new global political climate is developing that will cause all economic and trade relationships to be subject to question and challenge, eventually destabilizing existing political and military alliances.

Despite Washington’s sometimes unwarranted past actions, it has always seemed reasonable to believe that US multilateralism would continue, and that its broadly liberal values, willingness to listen and debate would lead those at the highest levels in Washington to find and deliver rational and consensus-based solutions. It is what bestowed great power status and more recently enabled it to share peace globally through balance and proportionality.

The US decision on Iran marks a watershed in international relations. It will require even relatively powerless nations in divided regions like the Caribbean to determine how best to respond to the increasingly divergent positions of the US, China, the EU27, the UK, and Russia as well as to the region’s hemispheric neighbors.

EDITOR’S NOTE: David Jessop is a consultant to the Caribbean Council and can be contacted at david.jessop@caribbean-council.org Previous columns can be found at www.caribbean-council.org.