Elections & Energy Policy Brief

ELECTIONS & ENERGY | La Jolla Conference 30 th Anniversary Policy Brief

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produce and export them, while favoring Chinese contractors and adding little value to Latin America in terms of job creation and development of capabilities.

The new Biden administration in the United States is reversing many of the policies of its predecessor, re-engaging the U.S. in a series of multilateral agreements that have significant impact in Latin America—such as the return to the World Health Organization and its Covax vaccine program. The U.S. administration has also put strong emphasis on its US$1.7 trillion climate plan. Although the focus is mostly domestic, it expects to create positive externalities for Latin America, for instance by nearshoring supply chains favoring investments in countries such as Mexico or Colombia and through increased foreign development assistance. The emergence of the Chinese state capitalism inspired international relation scholars to speculate about the risk of a new Thucydides trap, an upcoming conflict between the existing superpower, the United States, and the emerging one, China (Allison 2015). This global competition would then naturally influence Latin America’s energy policies. On the one hand, an increasing pent-up demand and economic recovery of China is putting upward pressure on commodity prices, improving Latin America’s economic outlook. Higher commodity prices would consolidate the region’s preference for extractive economic dependency, including the production and export of fossil fuels. On the other hand, attracting investments and financial support to a post-pandemic recovery from the U.S. and the EU would require Latin America to re-think its energy matrix and reduce its dependency on fossil fuels as a source of energy and exports, as both these entities are increasingly favoring a green recovery at home and abroad. THE 2021-2022 ELECTORAL CYCLE The newly elected officials across the region are unlikely to be granted “honey-moons” and instead would have limited mandates and weak governance. Furthermore, the outcomes from the elections already held in 2021 indicate that the region is not following a pattern of clear regional ideological preference or “wave”, as in previous decades. Elections and campaigns in Ecuador, Colombia, and Peru underscore this point.

ANNIVERSARY POLICY BRIEF | INSITUTE OF THE AMERICAS