Building Better Bonds with Latin America

Growing U.S. Latino Population Can Improve Relations

Latinos’ bicultural, transnational identity and strong relations to Latin America can help forge a stronger, mutually beneficial relationship in the years to come. As President Barack Obama gets ready to travel to the region this weekend, the growing Latino community in the United States should be viewed as an auspicious and overdue opportunity to foster cooperation, innovation, entrepreneurship, and stronger U.S.-Latin American relations.

The Latino community’s growth in the last decade is unprecedented. Results from the 2010 Census show the actual U.S. Hispanic population outstripped Census Bureau estimates. The 2010 Census counted a higher number of Hispanics in 23 of the 33 states where Census figures are out. The profile of Hispanics by country of origin remains largely the same. The vast majority of Hispanics are of Mexican origin followed by Puerto Rican, Salvadoran, and Cubans. The Brazilian and Colombian populations are far smaller but have strong presences in the Northeast and Florida.

Latin America is slowly emerging as an important market and key player in the global economy as the U.S. Hispanic community grows. Many Latin American economies weathered the global economic crisis better and emerged faster than the United States. Central and South America’s gross domestic product grew 6 percent in 2010, and it is expected to grow 4 percent in 2011. Chile and Brazil have increasingly formed investment and trade links with China. Chile’s trade with China is now more than double its trade with the United States, and China also has overtaken the United States as Brazil’s top trading partner. Argentina also has benefited from China’s investment. Last year it agreed to a $10 billion package with the Chinese to renovate its aging railway system.

The upshot: The United States can no longer afford to treat Latin America as an afterthought.

In his visit, President Obama is expected to reaffirm his commitment to fostering cooperation with Central and South America while focusing on the benefits of strong trade relationships. Trade policies that include good labor and environmental standards can create jobs and fuel economic growth both here and abroad.

Latinos are natural ambassadors to the region, and they are in a prime position to take advantage of trade opportunities that may arise. The Hispanic Chamber of Commerce reports that Hispanic businesses are the single fastest-growing segment of small businesses in the country. Close to 3 million Hispanic-owned businesses now generate almost $400 billion in annual revenue. Last September, the Commerce Department’s Minority Business Development Agency announced that the number of Hispanic-owned firms increased by nearly 44 percent between 2002 and 2007 from 1.6 million businesses to 2.3 million. Employment at Hispanic-owned firms also grew by 26 percent from 1.5 million to 1.9 million workers, a growth rate significantly higher than that of non-minority-owned firms.

U.S. Hispanic entrepreneurs are taking advantage of falling trade barriers by catering to the Hispanic market in the United States and by facilitating trade with the region.

According to the U.S. Hispanic Chamber of Commerce’s Vice President David Ferreira:

The rising economic power of U.S. Hispanics is having an incredibly beneficial impact in the trade with Latin America. We see that what can sometimes be a migratory chain becomes a supply chain. It becomes the migrant that sets up a business in the U.S. and starts selling American products to export abroad to their home country, or to import products to sell in the United States.

This trend is here to stay as the Latino community continues to growth.

Another example of strong and beneficial ties between U.S. Latinos and Latin America are hometown associations, or HTAs. HTAs are immigrant organizations based in a common hometown that come together for social, cultural, and political empowerment and economic development.

HTAs have formed in a number of U.S. cities and act as promoters of international development due to the significant aid they send to their countries of origin. In the past, Hometown Mexican Associations have partnered with the Mexican government to fund development projects in Mexico. Through its Tres por Uno program the Mexican government contributed $60 million in 2005 after Mexican HTAs raised $20 million toward development projects. And in El Salvador, HTAs such as the United Salvadoran Communities of the Washington D.C. Metropolitan Area were integral in providing relief aid to rural areas in the country following the 2001 earthquake.

These examples illustrate how Latinos, including recent immigrants, strengthen our commercial and people–to-people bonds with Latin America.

This is not to say, of course, that the growth of Latinos in the United States by itself will create better relations. Latinos—like the rest of the U.S. population—need to have a continued and more nuanced understanding of the 20 nations that make up Latin America and the nature of U.S. relations with individual countries. There are important differences in history and culture, and in the case of Brazil, even of language.

Yet as Latinos enter the workforce in greater numbers, Latin America will see more and more American leaders of Latino descent. These leaders will hopefully represent the best of both worlds and possess a deeper understanding of the region’s idiosyncrasy. In addition to cooperation and mutual prosperity, President Obama can offer the region a new sense of recognition, respect, and connection that is a welcome change to the past decades of uneasy friendship that have marked U.S.-Latin America relations.

Vanessa Cárdenas is the Director of Progress 2050, a project of the Center for American Progress in Washington, D.C., which seeks to build a progressive agenda that is more inclusive of the rich racial and ethnic makeup of our nation.

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