Latin America’s crucial electoral cycle
Latin America’s upcoming votes take place against the backdrop of US President Donald Trump’s second administration. Global Insight assesses the implications, from constitutional change to the bond markets and immigration.
As Latin America enters another pivotal year of elections in 2025, countries across the region face considerable challenges: inequality, crime, migration and security to name just four. Leadership contests will take place in several key Latin American economies, including Bolivia, Chile, Ecuador and Honduras. In October, Argentina will hold legislative elections, which many view as a referendum on Javier Milei’s presidency, midway through his four-year term.
Former Bolivian President Evo Morales speaks during a news conference in Mexico City, Mexico 20 November 2019. REUTERS/Carlos Jasso
There’s also a shifting leadership landscape in North America following the re-election of Donald Trump and Mark Carney replacing Justin Trudeau as Canada’s prime minister. This has created additional challenges and uncertainty in the region.
In 2024, presidential elections were held in the Dominican Republic, El Salvador, Mexico, Panama, Uruguay and Venezuela. The re-election of Nayib Bukele in El Salvador and anti-corruption crusader Luis Abinader in the Dominican Republic, both for a second term, raised hopes that some of the anti-incumbency sentiment that gripped the region in the wake of the Covid-19 pandemic may finally have dissipated.
Mexico, Panama and Uruguay’s recent presidents were constitutionally barred from standing for re-election. This resulted in three new leaders – José Raúl Mulino in Panama, Yamandú Orsi in Uruguay and former Mexico City mayor Claudia Sheinbaum becoming her country’s first-ever female president.
A recent Latinobarómetro poll found that for the first time since 2015 there are more Latin Americans who believe their country is advancing than those who think it’s moving backwards, providing some glimmers of democratic progress across the region.
Amid these re-elections and democratic transfers of power, in August 2024 Venezuela’s President Nicolás Maduro declared victory in another election marred by irregularities. He was sworn in for a third presidential term in January, but the election result has been widely denounced by the international community.
Ecuador the bellwether
The region’s 2025 electoral cycle had a febrile start after a remarkably close contest between Ecuador’s incumbent candidate Daniel Noboa and his rival Luisa González failed to produce an outright winner in February, prompting a run-off in April.
The candidates couldn’t be more different, says Christopher Sabatini, Senior Research Fellow for Latin America, US and the Americas Programme at Chatham House, which is partly what makes this election so intriguing. ‘These are two candidates that really are diametrically opposed’, says Sabatini. ‘Noboa is already trying to appeal to Trump. He attended Trump’s inauguration and belongs to a very landed family, so there are many personal affinities with Trump that he’s already trying to play up. On the other side you have Luisa González, a holdover from Rafael Correa, who was anti-American and who gave sweetheart deals to China, particularly in petroleum.’
Noboa was elected in 2023 after then-President Guillermo Lasso – facing an impeachment trial over embezzlement charges, which he denies – triggered an early election by dissolving parliament. During his short tenure Noboa has faced mounting criticism over a spiralling security situation, rising crime and homicide rates and a surge in cocaine trafficking and gang violence.
Ecuador's President and presidential candidate for reelection Daniel Noboa holds a campaign event for the upcoming Sunday presidential election, in Quito, Ecuador 6 February 2025. REUTERS/David Diaz Arcos
Ecuador’s election is the first in Latin America in the Trump 2.0 era […] it’s going to be a bellwether
Christopher Sabatini
Senior Research Fellow for Latin America, US and the Americas Programme, Chatham House
However, González’s association with former President Rafael Correa, who has been jailed in absentia for corruption, has considerably dampened her appeal with some sections of the electorate, particularly younger voters. With such polar-opposite candidates, Sabatini says the election is still wide open. He highlights that this is the first election in Latin America in the Trump 2.0 era and will be a bellwether for the region.
The ‘iron fist’ experiment
Salvadoran President Nayib Bukele gestures as he addresses his supporters protesting outside the national congress to push for the approval of funds for a government security plan in San Salvador, El Salvador 9 February 2020. REUTERS/Jose Cabezas
The ability of candidates to deal with organised crime and security concerns has already been tested at the ballot box in El Salvador. In February 2024, the incumbent President Bukele saw his ‘iron fist’ crackdown on gangs and efforts to drive down El Salvador’s murder rate rewarded with a landslide victory in the country’s election.
El Salvador’s constitution bars presidents from serving a second consecutive term. However, in 2021 the Constitutional Court, which by then was dominated by Bukele’s supporters, ruled that presidents could seek re-election for a second term, paving the way for him to stand again.
Bukele has won plaudits for his efforts to improve El Salvador’s security situation, but human rights groups have voiced concerns that his increasingly authoritarian policies are leading to arbitrary detentions, torture and other human rights abuses, and are steadily eroding democratic norms and the rule of law in the country.
‘El Salvador was one of the most dangerous countries in Central America and a lot of economic investment had left the country’, says Luz Nagle, former Co-Vice Chair of the IBA Human Rights Law Committee. ‘[Bukele’s] strategy against crime broke down the very high homicide rate and allowed the government to obtain control of neighbourhoods, but the problem was that a lot of people said youngsters were taken by the government and put in prison and didn’t have their days in court.’
One hallmark of Bukele’s strategy has been the creation of a maximum-security jail – CECOT (the Centre for the Confinement of Terrorism) – to imprison high-ranking members of Central America’s most notorious gangs: MS-13 and Tren de Aragua. It’s unknown how many prisoners are incarcerated in the so-called ‘mega prison’, but the government says it has capacity for up to 40,000 inmates. Bukele even offered to take in convicted criminals from the US during recent discussions with the American Secretary of State, Marco Rubio.
Despite concerns over El Salvador’s slide into authoritarianism, Bukele’s popularity remains extremely high. Nagle, who’s an academic and expert in international law and human rights, highlights the Cero Ocio (Zero Leisure) programme, which has already put thousands of inmates to work, primarily as labourers and tradesmen, to allow them to gain professional skills and repay society for the crimes they’ve committed.
She says Bukele’s social experiment will be fascinating to watch. ‘A lot of countries have abandoned their youth and the people who were born in the barrios [neighbourhoods] away from the major cities’, she says. What Bukele is doing with those inmates – giving them tools and a sense of self-worth and agency – is considered less dangerous and may enable them to go back to society and use those skills to help the country move forward, believes Nagle.
Power struggles and policy swings
Elections later this year in Bolivia and Chile are already proving to be tense contests even before the political campaigning has begun.
Bolivia will hold a presidential election in August, but deep divisions have already been exposed within the ruling Movement for Socialism party between those who back the current president, Luis Arce – who has signalled his intention to seek another term in office – and those who support Evo Morales, a former party leader who served as president from 2006 to 2019.
As the country’s first Indigenous leader, Morales was widely credited with enfranchising Indigenous communities and introducing land reform and other policies that redistributed wealth more equitably and slashed poverty and unemployment rates. However, he was forced to step down in 2019 following a disputed election.
Since that time, Arce himself has survived a brief coup attempt, while Morales faces statutory rape and human trafficking allegations, which he denies. At the end of February, Morales announced he was joining the Frente para la Victoria party and would run as the party’s presidential candidate in the election.
While this power struggle within the ruling party may have opened the door for new political leadership in Bolivia, Sabatini believes this could also present an opportunity for President Trump – whose first administration threw its support behind the ouster of Morales in 2019 – to try and sway voters towards a candidate more closely aligned with his thinking. ‘We’ll see Trump try to put a Trumpist stamp on a lot of these elections at a time when we have already seen an anti-incumbent mood and party shifts’, he believes. ‘When there’s a Trump-like candidate coming up, I think you’ll see a full on […] endorsement of them.’
In Chile, the incumbent leader, President Gabriel Boric, is ineligible to stand for re-election in November. There has been considerable speculation as to whether Michelle Bachelet, who served as Chile’s president from 2006-2010 and 2014-2018, will stand again, but she hasn’t yet declared her intention to run. The election promises to be ‘a referendum on Boric’s policies’ and the race is wide ‘open’ at this stage, says Francisco Roggero, Co-Chair of the IBA Latin American Regional Forum.
It’s expected that Evelyn Matthei, the leader of a coalition of parties named ‘Chile Vamos’ and who previously campaigned and lost against Bachelet, will be one of the rival candidates on the ballot paper.
A new administration could present Chileans with another opportunity to replace the country’s dictatorship-era constitution. Anti-government protests in 2019 ignited efforts to reform the constitution, but Chileans rejected proposals put forward in both 2022 and 2023. Following the second referendum, President Boric said no further review would take place before the end of his term in 2026.
Then-presidential candidate of the ruling MORENA party Claudia Sheinbaum holds a campaign rally in Nezahualcoyotl, State of Mexico, Mexico 9 April 2024. REUTERS/Raquel Cunha
Sabatini says the public’s stance on the constitution suggests there is unlikely to be an upset in the upcoming election. ‘They’d still rather have a constitution that, for all of its flaws, they know and understand, and that guarantees certain moderate policies, rather than bet on something a little more extreme’, he says. ‘Chile was one of the last countries to go through a democratic transition in the hemisphere, but it’s marked by its moderation, consensus politics and the lack of real, wild policy swings that we’ve seen everywhere else from Colombia to Argentina to Brazil. If Chile breaks that model in this election it will send a signal that the region itself is in greater turmoil.’
Argentina, business and bonds
Argentine presidential candidate Javier Milei of La Libertad Avanza party reacts during the closing event of his electoral campaign ahead of the presidential election, in Buenos Aires, Argentina, 18 October 2023. REUTERS/Matias Baglietto
Argentina will hold significant legislative elections in October as President Javier Milei seeks to consolidate his support in parliament. Milei’s party, La Libertad Avanza, currently lacks a majority in both chambers, which has made it more challenging for the president to push through wide-ranging laws to support his ambitious liberalisation and deregulation programme.
Milei’s ‘chainsaw economics’ strategy has already led to aggressive budget cuts and spending freezes that have devalued the Argentine peso, slashed subsidies, shuttered ministries, defunded cultural and social programmes and led to mass public sector lay-offs.
By December, the country was officially out of recession and by early January the government had paid $4.3bn to holders of its sovereign bonds – its largest repayment since a 2020 debt restructuring.
However, while many of Milei’s policies have succeeded in stabilising the economy, a number of challenges remain. ‘Despite Milei’s efforts to control inflation and stabilise the peso, Argentina’s chronic inflation problem remains a long-standing challenge’, says Roggero, a Managing Partner at Zang Bergel & Viñes Abogados in Buenos Aires. ‘Balancing inflation control with economic competitiveness will be crucial, especially given the country’s reliance on imports.’
Despite Milei’s efforts to control inflation and stabilise the peso, Argentina’s chronic inflation problem remains a long-standing challenge
Francisco Roggero
Co-Chair, IBA Latin American Regional Forum
Roggero cautions that the country’s debt burden remains high, and bond markets remain under pressure. ‘The government’s ability to meet its financial obligations will be tested, particularly if global financial conditions shift or if there is another downturn in commodity prices, on which Argentina heavily depends’, he says.
Sabatini believes that if Milei can gain political traction in Congress then this will ‘shift the partisan landscape’ in Argentina. ‘People talk a lot about the growth in poverty as a result of his cuts in subsidies and layoffs, but the truth is his popularity is still around 50 per cent’, he says. ‘If Milei does very well it will put the wind behind his back to [make] even deeper reforms [and] in terms of being able to seek another loan from the IMF [the International Monetary Fund], start to re-enter international capital markets and restructure defaulted debt.’
Despite his libertarian outlook, Milei’s brash style has drawn frequent comparisons with the current US president. His appearance at Mar-a-Lago following President Trump’s electoral victory and attendance at the presidential inauguration in Washington, DC, in January appeared to confirm the increasingly close relationship between the two leaders. ‘The idea of imposing tariffs would be anathema to Milei, but the idea of personalised bluster and performance – all those things really have a great resonance with Trump’, says Sabatini.
Trade war tensions
Trump’s re-election could lead to stronger bilateral ties between the US and countries such as Argentina, but tensions are already mounting elsewhere in the region.
Barely a few weeks into the new president’s leadership, the Trump administration said it would impose substantial tariffs on goods imported from Canada, China and Mexico, provoking significant backlash from the governments of these countries, as well as US policymakers who warned the tariffs could drive up domestic prices and damage the American economy.
Mexico is the second-largest trading partner of the US, making the threat of hiked tariffs a major economic red flag for the country. However, Claudia Sheinbaum and her ruling Morena party have responded robustly to US policy changes so far, including to Trump’s executive order renaming the Gulf of Mexico as the ‘Gulf of America’, with Sheinbaum poking fun at the decision by suggesting Google Maps rename North America as ‘América Mexicana’.
‘Because of [Morena’s] populist tendencies, they understand Trump in ways that other parties really don’t’, says Sabatini. ‘We saw this with Sheinbaum’s response to the Gulf of Mexico being changed to the Gulf of America. It was a performative, very funny, folksy pushback. In terms of knowing how to negotiate with Trump, it was a masterclass in what to do.’
In early March the US tariffs came into effect, adding a 25 per cent fee on all Canadian and Mexican imports and an additional 20 per cent on Chinese imported goods. As US stock markets tumbled, President Trump’s position appeared to soften. Within 24 hours he said he would grant car manufacturers a one-month reprieve from the tariffs imposed on imports from Canada and Mexico. This temporary exemption was expanded to other goods following calls with the Canadian and Mexican presidents. Both nations said they would suspend a second wave of retaliatory tariffs.
According to the way Trump has been governing, we could think he’s seeking to renegotiate or terminate the free trade agreement between Canada, Mexico and the US
Fernando Peláez-Pier
Former IBA President
Such tariffs will ‘without a doubt’ have a significant impact on the economies of the three countries, says Fernando Peláez-Pier, a former IBA President and a Member of the IBA Latin American Regional Forum Advisory Board. ‘According to the way Trump has been governing, we could think he’s seeking to renegotiate or terminate the free trade agreement between Canada, Mexico and the US’, he says.
Peláez-Pier, who’s also a senior consultant at FPeláez Consulting, says that what might cause Trump to change course is the impact the tariffs will have on the US electorate, for example by increasing the prices on products such as cars and food.
Meanwhile, China’s growing influence in Latin America, particularly in maritime trade, has long been a sore spot for Washington and there are concerns that the new US administration is already putting pressure on governments in the region to reassess their relations with Beijing.
In February, Panama said it wouldn’t renew an agreement in respect of China’s Belt and Road initiative following a meeting with US Secretary of State Marco Rubio, who’d called for Panama to make ‘immediate changes’ to what he described as China’s ‘influence and control’ over the Panama Canal. In March, Hong Kong-based CK Hutchison Holding announced it was selling much of its stake in two of the Canal’s key ports to a group led by US investment company BlackRock.
Despite these developments, Sabatini believes the recent spate of tariffs will only cause Beijing to double down on its investment in the region. ‘There could have been a more sensible tariff policy’, he says. ‘It’s an own goal in terms of probably furthering China’s economic interest in the region.’
An exacerbated crisis
The Trump administration’s policy changes to curb mass migration will also have a profound impact on Latin America. These include an executive order halting all undocumented migrants from entering the US, deploying an extra 1,500 active-duty troops to the US border with Mexico, reinstating a policy that forces non-Mexican asylum seekers to wait in the country while their claims are being processed and ending the temporary protected status (TPS) programme for migrants from countries such as Haiti and Venezuela.
These new policies and the administration’s increasingly stringent stance on immigration could affect a number of Latin American nations, including El Salvador, Guatemala, Honduras and Mexico, which have the largest number of citizens living illegally in the US.
The changes could also have a particularly detrimental impact on Venezuela, which faces an ever-worsening migration crisis. ‘Regarding [Trump’s policy towards Venezuela], he has taken a series of actions that range from returning Venezuelans who are illegally in the US or Venezuelans who are legally there under a TPS permit’, says Peláez-Pier. ‘These decisions represent great pressure for Maduro and have a serious impact on Venezuela.’
More than eight million Venezuelans are believed to have fled the country since 2015 as a result of the country’s ongoing political and socio-economic turmoil and continued human rights violations. The UN Refugee Agency estimates that more than 6.5 million of these are already residing elsewhere in Latin America and in the Caribbean, making it the region’s largest-ever forced displacement crisis. The Trump administration’s policies will probably worsen the situation.
In February, President Trump declared he would revoke the licence for Chevron’s operations in Venezuela, saying that the government of Nicolás Maduro had failed to meet ‘electoral conditions’. The licence was authorised by the Biden administration in 2022 and permitted to continue even after the US reimposed sanctions on Venezuela’s oil sector in 2024.
Peláez-Pier remains unconvinced that these policy changes will do anything other than exacerbate the country’s migration and economic crisis. ‘These measures are to put pressure on Maduro, who did not recognise the result of the recent elections and made the unilateral decision to ratify himself in power’, he says. Peláez-Pier questions President Trump’s strategy on Venezuela. ‘Maduro will never recognise a decision taken in an election, as we have seen’, he says.
The US administration’s transactional approach to tackling migration is already straining diplomatic relations in the region. Colombia narrowly averted its own trade war with the US in January after President Gustavo Petro reluctantly agreed to allow American military flights carrying deported Colombian migrants to land in the country. His decision came after President Trump threatened to impose 25 per cent tariffs on all Colombian goods being imported to the US.
Nagle denounces Trump’s attempts to reduce migrants to the level of traded commodities, rather than human beings. ‘They’re not pawns, they’re human beings’, she says. However, she’s hopeful that Trump’s re-election will provide the necessary catalyst for US legislators to finally deal with the US-Latin American migration crisis once and for all.
Ruth Green is a freelance journalist and can be contacted at ruthsineadgreen@gmail.com
Latin America’s elections of 2025
Ecuador, 13 April: Incumbent Daniel Noboa goes head-to-head with rival Luisa González in a run-off.
Bolivia, 17-19 August: Incumbent Luis Arce of the ruling Movement for Socialism party looks set to take on former president Evo Morales, who for the first time will run as the Frente para la Victoria party’s candidate.
Argentina, 26 October: President Javier Milei will vie to consolidate his influence in Parliament. Half of the seats in the Chamber of Deputies and a third of the seats in the Senate are up for grabs.
Chile, 16 November: Incumbent President Gabriel Boric is constitutionally barred from standing for re-election, leaving the race wide open. There’s been speculation as to whether former president Michelle Bachelet will run again. Evelyn Matthei, the leader of the Chile Vamos coalition, who previously campaigned and lost against Bachelet, is expected to be one of the rival candidates on the ballot paper.
Honduras, 30 November: Incumbent President Xiomara Castro isn’t eligible to stand for a second term. The Liberty and Refoundation Party, the National Party and the Liberal Party are all expected to put forward candidates for the presidential race.
Guyana, December: Incumbent President Mohamed Irfaan Ali of the People’s Progressive Party/Civic has declared he will seek a second and final term in office. Opposition leader Aubrey Norton of the People’s National Congress Reform is also expected to run.
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