Latin America News
LAST UPDATE: July 4, 2025
Colombia Foreign Minister Resigns, Citing Differences With Petro
Colombia’s Foreign Minister Laura Sarabia, a close ally of President Gustavo Petro, resigned on July 3, 2025, citing disagreements with recent government decisions, particularly concerning passport-printing contracts and institutional choices (bloomberg.com).
Insight
Sarabia’s departure exposes internal tensions within Petro’s cabinet over administrative transparency and procurement practices. As a key confidante, her exit could weaken Petro’s diplomatic reach and may exacerbate turmoil in foreign relations during an already unstable period.
Canada’s trade deficit narrows in May, US exports drop to lowest since pandemic
In May 2025, Canada’s trade deficit shrank to C$5.9 billion from C$7.6 billion in April, driven by rising exports (+1.1%) and falling imports (–1.6%). However, exports to the U.S. fell 0.9%, hitting their lowest level since 2020 .
Insight
Despite the overall deficit improvement, continued weakness in U.S. exports signals vulnerability in Canada’s largest trade channel. Nonetheless, the surge in non-U.S. exports, especially minerals and gold, shows Canada is actively diversifying its trade partnerships.
Middle East Conflict Was a Factor in Chile Holding Rates in June
Chile’s central bank held its key interest rate steady in June, citing heightened uncertainty stemming from escalating Middle East tensions .
Insight
Geopolitical risk from the Middle East has entered central bank calculus. This suggests policy is responding not just to domestic inflation and growth but also global geopolitical shocks, delaying rate cuts and keeping monetary policy cautious.
Investors See Way for Milei to End Fight Over State Oil Company
Investors believe President Javier Milei may settle litigation over YPF—Argentina’s state-owned oil company—after a U.S. court ordered the transfer of majority shares to satisfy investor claims .
Insight
With judicial pressure mounting, Milei appears poised to negotiate a resolution involving compensation or asset transfers. Settling could help lift lingering legal risks on YPF, paving the way for broader energy-sector reforms central to his agenda.
Mexico centralises government power in legislative blitz
Over a nine-day session, Mexico’s Congress passed at least 16 reforms under President Sheinbaum: creating new regulatory bodies, expanding biometric IDs, enhancing military access to geolocation data, and consolidating judiciary and telecom oversight .
Insight
These rapid-fire legislative changes signify a major shift toward centralising power—diminishing institutional checks and bolstering executive control. The speed and breadth suggest a decisive, albeit controversial, move away from Mexico’s prior democratic decentralization.
US recalls diplomat, eyes other steps in dispute with Colombia
The U.S. recalled Chargé d’Affaires John McNamara from its Bogotá embassy in response to “baseless and reprehensible” remarks by Colombia’s government. Colombia retaliated by recalling its own ambassador. The dispute covers collaboration on climate, anti-narcotics, and migration—even as bilateral trade totals $33.8 billion with a $1.6 billion U.S. surplus (reuters.com).
Insight
Diplomacy between the U.S. and Colombia is under significant strain, yet strong trade ties remain. Both nations are escalating diplomatic actions, which underscores the risk of impacting broader agendas like migration and security cooperation.
