Home Business US Pledges Billions in Economic Aid to Mexico and Central America

US Pledges Billions in Economic Aid to Mexico and Central America

by sanmigueltimes
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The United States has released a statement committing billions of US dollars toward developing Mexico and Central America in attempts of strengthening their economies. In doing this, the United States hopes that it will curb illegal immigration to the US by stabilizing their economies and improving their quality of life.

In a collaborative partnership with the new Mexican President Andres Manuel Lopez Obrador (AMLO), the United States hopes to work with Mexico to stabilize and develop Honduras, El Salvador, Guatemala, Panama, and other countries in Central America. In a statement, AMLO stated, “I have a dream that I want to see become a reality. . . that nobody will want to go work in the United States anymore.” A dream that surely American President Donald Trump shares.

The amount of the investment will be $10.6 Billion dollars, though only $4.5 billion will come from new capital such as loan guarantees, new loans, private sector support now available from the Overseas Private Investment Corporation (OPIC). Also, the American pledge includes $1.8 which has already been spent or allocated in the last three years, the US commitments to the Millenium Challenge, and any OPIC projects, such as a potential pipeline that could be worth $2.8 billion dollars when completed.

Funds that go through OPIC will not cost U.S. taxpayers, thus enabling a creative solution for the Trump Administration to accept the terms of this investment. The rest of the funds will be diverted from aid organizations and programs that already exist.

Of these funds, $2 billion US dollars will go toward southern Mexico, in hopes of developing the southern border to avoid an influx of immigration along the Southern States of Chiapas and Oaxaca. This will include plans for a Maya Train which will connect these states and others with new infrastructure throughout the Yucatan Peninsula.

The Mexican government sees this as a positive sign for cooperation with the American government in curtailing the influx of Central American immigration. This financial investment also seeks to address the issue of trafficking of narcotics as well as other international criminal enterprises.

This move is not unique. For decades, the United States has sought to invest in Central America to prevent migration to their country. In 2016, then President Obama invested ¾ of a billion US dollars in hopes of curtailing immigration then.

However, the Trump administration has launched a review in hopes of cutting financial aid to foreign governments, and this initiative could be on the list. Though the plan is to allocate $10.6 billion US dollars, however, the overall commitment of foreign assistance is only $2.6 billion US dollars.

This also comes with promises from the nations that would receive these funds. These Central American nations would also join in the venture to combat unemployment, government corruption, violence, and other factors which are causing people to emigrate.

A business conference is scheduled early 2019 for Mexico and the United States to discuss the issue of legal migration, investment opportunities, and Mexico’s willingness to hold Central American refugees on Mexican soil while they apply for asylum.

Source: Reuters

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