As Donald Trump moves forward with appointments for his new administration, he has rattled close neighbours Canada and Mexico – as well as BRICS nations including Brazil, a founding member – by threatening tariffs. The policy shift appears erratic at first glance and, on closer inspection, signals an unpredictable start.

This whimsicality has led my contacts in Brazilian foreign affairs to adopt a “wait and see” approach. And for good reason: Trump is nothing but hard to pin down. Still, some recurring patterns emerge, such as the use of tariffs and threats as diplomatic tools and appointments based on allegiance. After facing setbacks in his first term, Trump seems to have elevated loyalty to the top of his checklist for appointees, often at the expense of competence.

Even with this unpredictability, his cabinet picks provide insight into his likely approach to Latin America. While the specifics remain under wraps, the contours of Trump’s approach are already becoming clear, suggesting a strategy combining protectionism, loyalty-driven governance, and his well-known habit of stoking controversy.

Migration Policy: Strict Enforcement and Border Control

With Tom Homan, a known hardliner on immigration, picked as border czar and Stephen Miller, an architect of tough immigration policies during Trump’s first term, tapped as deputy chief of staff, Latin America expects a renewed focus on curbing illegal immigration through stricter border enforcement, expanding physical barriers, and possibly revisiting family separation policies. These plans would disproportionately impact Central American nations, which are the primary sources of migrants seeking refuge in the US. Further, tougher restrictions on legal migration – including cuts to refugee admissions and visa programmes – could also affect countries like Venezuela, Cuba, and Haiti, whose citizens frequently apply for asylum or temporary protected status in the US.

Foreign Policy and Trade: Isolationist and "America First"

Donald Trump’s latest appointments signal a clear shift in US foreign policy towards a more isolationist and transactional approach. Mike Waltz as national security adviser brings a defence-oriented perspective with pragmatic isolationism, Marco Rubio as secretary of state introduces a hawkish stance aimed at countering China’s influence and addressing perceived leftist shifts in the region, and Elise Stefanik as UN ambassador suggests a diminished emphasis on multilateral diplomacy in favour of direct, transactional relationships.

These choices point to policies that prioritise US interests over broader engagement, with Latin America likely facing targeted sanctions or interventions – particularly against nations perceived as aligning with China or adopting leftist policies. Countries like Venezuela, Cuba, and Nicaragua will see increased pressure, while nations with strong economic ties to China, such as Brazil, Peru and Argentina, might struggle to balance their relationship with both powers.

Brazil’s decision not to officially join China’s Belt and Road Initiative, yet signing 37 important agreements and projects during Xi Jinping’s recent visit, is seen as a cautious move to avoid provoking Trump’s new administration.

Despite Argentine President Milei's ultra-liberal rhetoric and personal ties to Trump and Musk, Argentina remains a key recipient of significant Chinese investments. These include hydropower projects like the Kirchner-Cepernic dams, agricultural trade in soybeans and meat, and financing for rail and transportation infrastructure.

On trade and economic policy, the selection of Robert Lighthizer, a staunch advocate of tariffs and renegotiated trade deals, marks a turn towards protectionism. This includes expanding tariffs or new trade barriers targeting China and pressuring Latin American allies for trade deals more favourable to US industries.

For the region, the implications are massive. Countries heavily dependent on trade with the US, such as Mexico, Guatemala, and Honduras, are particularly vulnerable. Mexico, which sends approximately 85% of its exports to the US, would be among the hardest hit by proposed tariffs. Potential retaliation from Mexico could strain relations further, especially in light of trade diversion concerns, such as China allegedly using the country as a backdoor to bypass US import tariffs. Despite the US-Mexico-Canada Agreement (USMCA), Washington’s next steps under Trump could mean heightened tensions and economic uncertainty for the region.

Tariffs and Tensions: Mexico Stands Firm Against Trump’s Threats

Trump has accused Mexico of allowing "thousands of people" to pour into the US, allegedly bringing "crime and drugs at levels never seen before." He specifically singled out fentanyl, claiming Mexico is responsible for its entry into the US.

To escalate matters, the president-elect threatened to slap tariffs on Mexican goods – a clear violation of their free trade agreement – to pressure the country into stricter migration and drug control measures. He also floated the idea of taxing remittances sent from the US to Mexico, which could deprive many Mexican families of an important economic lifeline. As if that were not enough, Trump suggested designating Mexican cartels as terrorist organisations, a move that could pave the way for US military actions against them.

In response, Mexico's President Claudia Sheinbaum firmly warned that her country would impose retaliatory tariffs on US goods, potentially sparking a cycle of economic risks for both nations. She also highlighted the US' own role in fuelling violence in Mexico, pointing out that many of the guns used by Mexican gangs originate from there. Moreover, Sheinbaum noted that the demand for synthetic drugs like fentanyl primarily comes from the US, fanning violence south of the border.

Sheinbaum did not mince her words, as she further criticised US spending priorities, suggesting that reallocating a fraction of its war budget towards addressing root causes of migration and development in Mexico could yield more sustainable results. In a bid to advocate for dialogue over confrontation, she intends to send a letter to Trump urging cooperation between the two countries.

Implications for US-Mexico Relations

With such a heated start, one wonders about the implications for US-Mexico relations under Trump’s second administration. The early exchange of accusations and threats has set an aggressive tone, making a bumpy bilateral relationship almost inevitable. A potential tariff war could disrupt trade, dealing a blow to the Mexican economy that heavily relies on cross-border commerce.

Geopolitically, Mexico’s newfound confidence – buoyed by support from China – reflects a shift in its approach to US pressure. This could introduce new dynamics in North American relations, challenging long-standing power balances. In this regard, Sheinbaum’s assertive and articulate response – not seen from Canadian or European partners – underscores Mexico’s refusal to capitulate to US threats.

Ultimately, Trump’s aggressive rhetoric and Sheinbaum’s resolute stance highlight deeper structural issues, such as US drug demand and arms trafficking to Mexico. Addressing these challenges will require cooperative solutions rather than unilateral actions. However, the involvement of external powers like China adds another layer of complexity, making the path forward fraught with hurdles.

The China Factor in Latin America: A Further Problem for Trump’s New Administration

China poses a significant challenge to the US’ enduring dominance in Latin America.

According to a Brazilian study, Beijing’s strategy of combining economic pragmatism with diplomatic engagement resonates with many Latin American nations dealing with developmental challenges and infrastructure deficits. Unlike the US, which often attaches economic and political strings to its aid and investments, China offers relatively unconditional financial support, making it an appealing partner and consolidating cooperation under the “South-South” label. As a result, countries like Brazil and Peru are increasingly pivoting towards Beijing, gradually eroding the US' traditional hegemony in the region. In fact, China is already the first trading partner for Brazil, Chile, Peru, and Uruguay, and second only to Brazil in Argentina, both in trade and foreign investments.

With his confrontational stance, Trump risks further alienating Latin America. In stark contrast, China’s focus on infrastructure and socio-economic development fosters goodwill and strengthens its geopolitical presence. Projects such as Chancay Port in Peru and regional integration programmes highlight China’s ability to provide substantial financial and infrastructural support, offering Latin American nations an enticing alternative to conventional US economic partnerships.

Trump’s transition team reportedly considered imposing a 60% tariff on goods transiting via the newly inaugurated Chancay Port – a move that reflects US concerns over losing economic leverage. Furthermore, Trump has also threatened BRICS nations with sanctions for reducing reliance on the US dollar, a process that is already underway.

While Chinese President Xi Jinping speaks the language of partnership and shared development, Trump continues to indulge in a tired imperialistic rhetoric, which is increasingly unpalatable to the region.

Conclusion

China's strategic investments in Latin America, particularly in countries like Peru and Brazil, illustrate its growing influence in the region. Through the Belt and Road Initiative and wide-ranging investments in infrastructure, energy, and natural resources, Beijing has positioned itself as a key economic partner for many Latin American nations. This shift poses a major challenge to Trump’s new administration, which will have to find a balance between maintaining US influence in its “backyard” and countering China's rising appeal. Washington risks losing ground in the region if it fails to engage constructively with Latin America, particularly in the face of China’s expanding footprint.

Latin American leaders are also mindful of the enduring legacy of the Monroe Doctrine, which has historically justified US interference in regional political matters, backing several dictatorial coups. However, the region is now confronting a more complex geopolitical reality, where China’s economic presence is hard to ignore. Trump is expected to take a stronger stance against Beijing's growing influence. Yet, the incoming administration has focused so far on populism, isolationism, and a more transactional approach to international relations. Communist countries like Cuba, Venezuela, and Nicaragua will likely remain on Trump’s radar as unfriendly nations. Meanwhile, in other parts of Latin America burgeoning right-wing groups bear high hopes that the new cabinet will support their political aspirations.

Trump’s new appointments, including figures like Tom Homan and Stephen Miller, indicate a pivot towards a more cohesive "America First" administration. This will likely result in a tougher, more unilateral approach to migration, trade, and diplomacy. While the pragmatism of business leaders like Elon Musk may temper some of these moves, the general direction points to a foreign policy that is erratic, confrontational and focused on protecting US interests above all else. Ultimately, Trump’s message remains clear: countries do not have permanent allies, only shifting interests.

Ricardo Martins is based in Utrecht, the Netherlands, and has a PhD in Sociology specialising in European politics, geopolitics and international relations.