Welcome back to Foreign Policy’s Latin America Brief.
The highlights this week: Brazil readies to host the BRICS leaders’ summit, Bolivia embraces cryptocurrency amid an economic crisis, and Mercosur notches a new trade deal.
Brazil Prepares to Host BRICS Summit
The BRICS leaders’ summit begins this weekend in Rio de Janeiro. The group of emerging economies has become increasingly relevant in world politics in recent years. But it’s also more unruly than ever.
BRICS expanded from five to nine members in 2024 and added Indonesia this year. (The acronym stands for standard-bearers Brazil, Russia, India, China, and South Africa.) In addition to the 10-member roster, Saudi Arabia regularly attends BRICS meetings; the kingdom has not yet accepted its formal membership invitation. Ten other countries have official “partner country” status. A handful more are attending the Brazil summit as guests, including Mexico.
The expansion is in part to blame for growing discord within the bloc. At an April BRICS foreign ministers’ summit, Egypt and Ethiopia blocked a declaration backing South Africa’s ambitions for a permanent seat on the United Nations Security Council.
But political disagreements have not watered down the group’s relevance. On the contrary: Many countries have sought out BRICS affiliations as a means of diversifying their trade and political relationships amid unpredictability from U.S. President Donald Trump.
Officials across the world are asking themselves: “Outside of the United States, what can we do for the medium to long haul?” said Sarang Shidore, the director of the Quincy Institute’s Global South program. At a time when “the mood in Washington is hostile to trade,” he added, BRICS is “the closest thing we have to a multilateral node for an alternative to where the superpower is going.”
The United Arab Emirates is one of the bloc’s new members. “BRICS brings together large and fast-growing consumer markets across Asia, Africa, and Latin America,” senior Emirati foreign affairs official Ahmed Ali Al Sayegh wrote in a statement to Foreign Policy. He added that membership gave the country “even more diversified access to significant economies.”
Brazil’s yearlong BRICS presidency is a chance for the country to put its stamp on the group. While BRICS has often drawn Western ire for its stances on wars in Gaza, Iran, and Ukraine, Brasília’s summit agenda is focused on economic development, in particular climate finance.
Brazil’s goals include establishing new loan guarantees from BRICS’s development bank, the Shanghai-based New Development Bank, finance ministry official Tatiana Rosito told Folha de S. Paulo. The New Development Bank focuses on infrastructure, sustainability, and local currency operations.
Brazil will also try to iron out climate policy differences between its members ahead of November’s COP30 U.N. climate conference in the Amazonian city of Belém, Rosito added. At a U.N. biodiversity summit earlier this year, BRICS countries submitted a joint proposal that served as the basis for the final summit decision on global funding of nature protection.
While BRICS does not officially negotiate as a bloc in U.N. climate summits, “we are looking to build convergence,” Rosito said. Russia has been a consistent opponent of language about moving away from fossil fuels.
Progress on economic and climate cooperation would support an argument that Brazil and India have long made to BRICS detractors: The bloc is not about opposing the West, but rather supporting developing countries. (China and Russia are more comfortable with an overtly anti-Western tilt.)
Whether Brazil succeeds at shaping BRICS’s agenda will be hard to judge in a single summit. Much of the group’s value lies in the face-to-face time it allows senior officials from different countries. BRICS events are “a place where ideas can be tested and discussed,” Shidore told Foreign Policy. Parallel private-sector events could also lead to new business connections.
If the group increased its focus, it could achieve more than just talking. Shidore has pointed out that one of BRICS’ most concrete achievements—the New Development Bank—has grown far more slowly than a similar lender founded around the same time, the Asian Infrastructure Investment Bank. The former announced plans to lend only around $5 billion in 2024, while the latter lent over $8 billion.
Like BRICS itself, the New Development Bank has attracted new members in recent months, with Colombia, Uzbekistan, and Indonesia in the process of joining. Uzbekistan is a BRICS partner country, while Colombia is not an official BRICS member or partner state.
These countries have in the past sought out lenders such as the World Bank or International Monetary Fund. But the United States is the biggest shareholder in both, and the Trump administration has signaled it might flex its influence to veto some lending.
Upcoming Events
Friday, July 4, to Saturday, July 5: Indian Prime Minister Narendra Modi visits Argentina.
Saturday, July 5: U.S. Temporary Protected Status expires for beneficiaries from Nicaragua and Honduras.
Sunday, July 6, to Monday, July 7: Brazil hosts the BRICS leaders’ summit.
What We’re Following
Mercosur’s newest trade deal. Following the conclusion of trade talks with the European Union last December, Mercosur on Wednesday announced that it had wrapped up another European trade deal. This one is with the European Free Trade Association (EFTA), a group of four non-EU countries: Iceland, Liechtenstein, Norway, and Switzerland.
Like the EU deal, the EFTA agreement had been in the works for years. Leaders prioritized it in the wake of Trump’s protectionism, and it still faces internal approval in EFTA and Mercosur member countries. But the EFTA deal does not appear to face the same level of resistance from European agriculture sectors that has complicated the EU deal.
While French farmers may yet block the EU agreement, Switzerland’s economic affairs secretary said at a press conference in Buenos Aires that the Mercosur deal is “a complete priority for the EFTA countries.” It would remove trade barriers to more than 97 percent of exports, according to a joint EFTA-Mercosur statement.
People line up to buy chicken in La Paz, Bolivia, on June 11.Aizar Raldes/AFP via Getty Images
Bitcoin in Bolivia. El Salvador is known as the Western Hemisphere’s biggest cryptocurrency advocate. But another country in the Americas has also recently—and unexpectedly—come to embrace it: Bolivia.
Bolivian regulators for many years took a conservative stance on cryptocurrency and banned it. But amid a deep economic crisis and dwindling dollar reserves, they reversed course last year and allowed cryptocurrencies for the first time.
In March, the state energy firm said it would start using cryptocurrency to pay for energy imports. Last Friday, Bolivia’s central bank said that transactions using electronic payment channels and virtual assets grew over 500 percent between the first half of 2024 and the first half of 2025.
While the use of cryptocurrencies may allow Bolivians to conduct some business, it doesn’t address bigger economic problems. Annual inflation in the country stood at over 18 percent in May, and the local currency’s unofficial exchange rate has fallen by around 50 percent against the dollar this year alone. Amid this volatility, Bolivia is due to hold presidential elections next month.
U.S. security strategy. Two recent events provide glimpses of the Trump administration’s strategy for combating organized crime in Latin America.
Ecuador and the United States have cooperated on anti-crime efforts since 2024. The United States assisted Ecuadorian intelligence officers in an operation to track fugitive drug boss José Adolfo “Fito” Macías Villamar, the Washington Post reported; last Wednesday, he was captured. While U.S. security assistance often militarizes law enforcement in the region, no one was killed during Fito’s arrest.
In Mexico, the United States tested a different approach. Also last Wednesday, the Treasury Department banned certain U.S. transactions with three Mexican financial institutions—two banks and one brokerage firm—accusing them of helping move money for fentanyl smuggling. Each of the two banks accounts for less than 1 percent of Mexico’s financial system.
The sanctions came as a shock to the Mexican government. President Claudia Sheinbaum said that Mexico had received insufficient evidence about the banks’ alleged wrongdoing.
Question of the Week
Bolivia’s economic turmoil is related to its falling natural gas production. When did that production peak?
According to its state energy firm, Bolivia’s natural gas production peaked in 2014.
FP’s Most Read This Week
- The End of Modernity by Christopher Clark
- Iran Is on Course for a Bomb After U.S. Strikes Fail to Destroy Facilities by Jeffrey Lewis
- Israel’s War on Iran Backfired by Sina Toossi
In Focus: A Cuba Policy Retrospective
A Cuban arts and crafts salesman cleans a street in front of his business decorated with a poster of former Cuban President Raúl Castro on his 94th birthday in Havana on June 3.Yamil Lage/AFP via Getty Images
This week, Trump ordered top officials to study how to tighten economic restrictions on Cuba, potentially via wide-reaching secondary sanctions. Secretary of State Marco Rubio, who is of Cuban descent, has long been vocal about his desire for Cubans to oust the ruling Communist government. But decades of U.S. economic warfare have failed to bring about regime change.
Given the hardened nature of U.S. Cuba policy today, it is all the more remarkable that Washington tried a dramatically different approach about a decade ago, under President Barack Obama.
A new show from Foreign Policy’s podcast team details the secret talks that led to a political thaw between Havana and Washington in December 2014. Produced with Audible and Skybound Entertainment, the show hears directly from many of the protagonists who engaged in the diplomacy. Because of decades of animosity between the two countries, it took signaling from Obama himself to convince Cubans that the United States was serious about improving relations.
The deal included months of secret confidence-building measures, among them a highly unusual episode of “stork diplomacy,” in the words of FP’s Dan Ephron, the show’s host. U.S. officials facilitated a sperm transfer from a Cuban spy jailed in the United States, allowing his wife in Cuba to get pregnant. In 2015 and 2016, rapprochement brought a swarm of new interest from U.S. companies in doing business on the island.
Trump rolled back the agreement in his first term, vowing to undo many of Obama’s policies. Former Obama advisor Ben Rhodes told Ephron that the Cuba-U.S. relationship snapped back to “the worst aspects” of each country’s foreign policy. “We are going to hurt individual people because we’re mad about something that happened 60 years ago or 70 years ago,” Rhodes said.