Wednesday, November 09, 2016

The impact of Trump's election on El Salvador

This morning, the government of El Salvador saluted Donald Trump for his election as president of the United States.  But what will a Donald Trump presidency mean for El Salvador?   Here are a few areas where his impact will be felt.

Immigration.  Without a doubt, an anti-immigrant Trump administration could have serious economic and social impacts on El Salvador.   Approximately one of every four people alive who were born in El Salvador  or an estimated 2 million Salvadorans, currently live in the US. Remittances which they send home make up one sixth of El Salvador's gross national product.  

Estimates vary, but perhaps between 700,000 and 1 million Salvadorans in the US are undocumented and would be a focus of Trump's immigration enforcement efforts.  If a significant percentage of them are suddenly deported, the disruption in El Salvador will be great.  Most certainly,  executive actions of the Obama administration which were intended to reduce deportations will be reversed or limited by Trump.   These could include DACA (Deferred Action for Childhood Arrivals) as well as the Central American Minors Program, and the new refugee program in coordination with the UNHCR.

Of immediate concern to the government of El Salvador is the preservation of Temporary Protected Status  There are currently about 200,000 Salvadorans residing in the US on Temporary Protected Status ("TPS")   These are people who are not in the US legally, but as a result of being in the US at the time of the 2001 earthquakes, the US has deferred deporting them for humanitarian reasons.   That status has continually been extended by executive action, until the current expiration date of March 9, 2018.   I would think there would be a serious question whether a Trump administration would grant another extension.   This morning the government of El Salvador instructed its ambassador in Washington to make contact with the Trump transition team to try to make sure that TPS is retained.

Trade policy and economic blowback

I do not recall Trump mentioning the DR-CAFTA trade agreement which lowered trade barriers between the US and the countries of Central America and the Dominican Republic.  Trump focused in his campaign on NAFTA and the Trans-Pacific Partnership (TPP), but also spoke broadly of ripping up "our awful trade deals."

This morning in the region, people are asking whether Trump will also try to undo DR-CAFTA.  (Note:  Hillary Clinton opposed DR-CAFTA as a Senator, as did I).

Trump's overall rhetoric is focused on the outsourcing of US jobs to overseas locations and bringing those jobs back to the US.   Frankly, I have not seen many jobs fleeing the US and relocating in El Salvador.   The only two which come to mind as possibilities are call centers and aircraft maintenance.   Call centers are a booming business in El Salvador, answering customer service calls for global businesses, but I am not sure that their presence here is a result of DR-CAFTA or any other trade agreement.   US airlines, in particular Southwest, do contract for aircraft overhaul maintenance in El Salvador, and that practice has long angered airline unions.

If Trump policies lead to economic contraction it will be felt in El Salvador.   Every time the US economy sneezes, El Salvador catches the flu.   Economic slowdowns in the US lead to reductions in the important remittance flows into El Salvador.    In addition, if Trump policies lead to a decline in the value of the US dollar, it will be felt in El Salvador which uses the dollar as its currency.  A declining dollar will make purchasing goods in world markets more expensive for El Salvador.  

Climate change

Fortune Magazine this morning wrote:

While many groups from Silicon Valley to the auto industry are concerned about the [Trump] win, none should be more worried than those working on the future of clean energy and the fight against climate change.
El Salvador is particularly vulnerable to climate change which can lead to droughts, to coastal flooding, to destructive tropical storm activity, and reductions in food production.   El Salvador can do nothing alone to halt the increases in greenhouse gases; that depends on the actions of the US and other industrialized nations.   Those actions and international agreements on climate change are imperiled by a Trump presidency.

Trump's Latin America policy.  What Latin America policy?






7 comments:

Carlos X said...

Also, in the past, there have been attempts by Salvadoran governments to ingratiate themselves with the U.S. Administration. Notorious in this regard, to my mind, were the efforts of Tony Saca to pander to the Bush Administration, offering Salvadoran soldiers to go into Iraq, where the Salvadoran national interest was scant, to put it generously. More recently, Mauricio Funes also appeared to court the Obama Administration. Both Saca and Funes secured visits to El Salvador by their respective POTUS. It seems hard to imagine that Salvador Sanchez Ceren would seek to form any strategic alliance with Trump, but it seems quite predictable that ARENA may revert to their old habit of claiming closeness to the U.S. government as an added benefit of their governing El Salvador.

Kim Cornejo said...

I voted for Trump so I am admittedly biased. So let's get that clear. On the other hand, I am a gringo married to a guanaca and I've been living in Salvilandia for many years. I think overall there has to be a border and restrictions on illegal immigration. Yes, the word is "illegal". Many want to varnish and lacquer it with euphemisms of migrants, central american diaspora, but it's illegal immigration if you weren't properly vetted. Ask any gringo how difficult if not impossible it is to obtain residency in Central America even if you're making good cash from a pension.

On that note, I have seen school workbooks for 9 year old kids encouraging them to migrate north to EEUU. I have seen pueblos void of men except for the gang bangers. There are a bunch of women, kids and old people hanging around while the worker bees in EEUU send cash home. The influx of remesas can be helpful but it creates an artificial wealth that is not based on any solid or replenishing economic base. It is "fake" wealth. This sucks away any incentive for people to seek opportunities and make positive changes.

I think cutting remesas will be painful if not disastrous but sometimes the body has to go into sepsis to get its immune system into overdrive. Remesas have decentralized and dismantled nuclear families, contributed to laziness and lackluster behavior, diminishes the drive to succeed.

These Salvi leaders are scum just like a lot of our politicians stateside. The only difference to me are the borders, but they operate in similar fashion. The American politicians are still kept under checks and balances by the American people who by in large are educated and have access to economic genesis. The Salvis have not reached the level of their American counterparts but they can do it. But sacrifices have to be made. It sounds cliche but I will say, stay in your country and stop running away from your problems. Make changes. Install your proteges into government and hold their feet to the fire to reciprocate with humanitarian policies to promote economic and social growth instead of the robber barons that now proliferate El Salvi. Just my 2 cents.

Lawrence M. Ladutke said...

You forget to mention that the mass deportation of Central Americans will cut off remittances--a major source of the region's income--increase deportation, and put an incredible strain on public services (education, police, health, etc.) Lots of jobless youth with little hope or opportunity will be very prone to recruitment by the gangs

Edmundo Santiago said...

During President Obama's 8 year administration, over 2.5 million people were deported... more than all presidents of the 20th century. Not sure exactly what the executive orders that Pres. Obama signed into action actually say (or do), but the stats speak a bit differently than what people are 'fearing' from President-elect Trump.

http://abcnews.go.com/Politics/obamas-deportation-policy-numbers/story?id=41715661

Kim Cornejo said...

It will slow down the remesas but relieve Americans from high taxes to subsidize illegal aliens and collateral damages from their presence in the USA. I ask El Salvador what would you do if thousands of Americans leave thre USA with Trump-phobia and demand public service, subsidized housing, and English in schools. Also howbwould ES feel about skilled and unskilled gringos amassing by the thousands to compete for jobs?

I am sorry but it's not a one way street and the party is over.

Edmundo Santiago said...

I have an inclination that the U.S. federal government allows immigration, whether 'illegal' or otherwise, in order to sustain profitability for businesses both large and small.

Consider if the jobs currently occupied by those willing to work for near peanuts would be occupied by people born stateside.

Unions would be demanded, rights, and a wage that reflects the inflation rate... and how would such demands affect many businesses who depend on low labor wages?

If only we can look past the framed narratives the media programs onto our consciousness, and actually 'see' what has always been in place... and why.

Is the American Dream only a nationalistic ideal?

Hasn't the American Dream been a major export onto the minds of all other countries outside the U.S.?

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