Dear readers,

In this week’s edition of Latinsight’s Strategic Briefing, I analyze the current tensions between Cuba and the United States and how the situation could possibly unfold in the near future.

I provide an update on Peru’s general elections, which took place on Sunday and have been marked by logistical chaos. You will also find usual market intelligence updates.

Thank you for your support!

❐ STRATEGIC OUTLOOK

Cuba: Pressure, Negotiations, and What an Opening Would Actually Mean

In early 2026, the geopolitical landscape surrounding Cuba has reached a point of maximum tension following a series of dramatic regional shifts. The Trump administration’s January 29 Executive Order formally labeled the island a direct national security threat. This declaration has authorized a de facto naval blockade, including the inspection of vessels and secondary sanctions against any third party supplying Cuba with energy.

The US oil blockade is putting pressure on Cuba. Photo: Ramon Espinosa

The mechanics of the blockade

Following the US military operation that removed Venezuelan President Nicolás Maduro in January, the Trump administration cut off the flow of Venezuelan oil to Cuba and imposed tariffs against any country supplying the island with fuel. Mexico's PEMEX suspended shipments under US pressure. The humanitarian consequences have been severe: Cuba suffered three nationwide blackouts in March, compounding years of underinvestment in its energy infrastructure. Washington's stated objective is political change. Senior US officials have indicated the end goal includes the potential removal of President Díaz-Canel, though the commander of US Southern Command confirmed in March that no military invasion is being planned.

Can Cuba negotiate its way out ?

Three developments in the past two weeks suggest negotiations are moving, however slowly. Washington allowed a Russian oil tanker to dock in Havana on March 30 without intercepting it — a deliberate choice. On April 3, Cuba released 2,010 prisoners, its largest such release in years. And Díaz-Canel gave his first interview to a US television network on April 13, confirming that talks with Washington are underway, while describing them as "possible but difficult." Cuba's chief negotiator Josefina Vidal, who led the 2015 Obama-era détente, described the process as "very preliminary, with no structured negotiations yet."

What an opening would actually look like

The central obstacle to any Cuban economic opening is structural. GAESA, the military-run conglomerate, controls Cuba's most strategic sectors (tourism, retail, ports, remittances, financial operations), generating revenues 3.2 times greater than the entire Cuban state budget and profits equivalent to nearly 37% of GDP. The question analysts are asking is whether a genuine transition is possible without dismantling GAESA's grip.

A private sector does exist and is expanding. More than 11,000 private MSMEs have been approved since 2021, now contributing 23% of national tax revenues and accounting for the majority of retail sales. In March, Cuba published Decree-Law 144 allowing state enterprises to partner with private businesses for the first time, and announced measures permitting diaspora Cubans to invest directly in the island. Cuban economist Pedro Monreal describes this as a political signal of openness more than a structural reform, given that all partnerships remain subject to Ministry approval. The most likely near-term scenario is a managed partial opening: diaspora investment in MSMEs, selective tourism liberalisation, with GAESA retaining control of the commanding heights.

🎯 Strategic perspective

Drawing from the current crisis, three primary scenarios emerge for the remainder of the year:

Scenario 1 - The "Cubastroika" (Managed Transition): A limited agreement leads to the departure of President Miguel Díaz-Canel in exchange for sanctions relief. While the private sector expands through diaspora investment, the military elite and the Castro family maintain their grip on the strategic GAESA conglomerate.

Scenario 2 - Systemic Collapse and "Humanitarian Corridor”: Continued fuel blockades cause the failure of basic services and nationwide blackouts, sparking massive irregular migration. Under the guise of a crisis, the U.S. establishes a "humanitarian corridor" or "exclusion zone," facilitating a technical military entry without a formal invasion.

Scenario 3 - The Surgical Intervention: Following the Venezuelan model, Washington executes a limited "surgical" military operation or command-style strike to remove the island's leadership. This scenario carries the highest risk of triggering a full-scale mobilization under Cuba’s "War of All the People" doctrine.

The ultimate question for Cuba in 2026 mirrors the Venezuelan dilemma: as long as the regime retains control of its primary revenue source (GAESA) it can finance the security networks that ensure its survival. True transition may require not just political change, but the dismantling of the military’s economic empire

❐ POLICY & MACRO WATCH

  • Peru: Election results delayed after massive logistical and technical failures
    Peru's general election has descended into unprecedented logistical chaos, forcing authorities to grant a rare one-day extension for over 52,000 voters after technical failures and ballot delivery delays paralyzed polling stations in Lima and abroad. This disruption strikes a nation already weary of chronic instability, having seen eight presidents in a single decade amid widespread corruption and a surge in violent extortion.

    With approximately 74% of the official count completed, Keiko Fujimori leads the race with 16.9% of the vote, while Rafael López Aliaga and Jorge Nieto remain locked in a tight battle for the second spot in the almost certain June 7 run-off. Beyond the presidency, the election of a newly re-established 60-member Senate is viewed as a critical stabilizing factor, as this legislative body — unlike the lower house — cannot be dissolved by the executive. (BBC / The Guardian / CNN Chile)

  • Colombia: S&P downgrades sovereign rating to BB- on fiscal concerns
    S&P Global lowered Colombia’s credit rating to BB- for the first time since 1993, citing persistent fiscal deficits and a less predictable fiscal policy. The downgrade places Colombia on par with countries like Turkey and Honduras, signaling a growing distance from investment grade. (La Republica)

  • Uruguay: "Unimaginable" US pressure to sever trade ties with China
    Uruguay’s Economy Minister revealed intense pressure from Washington to cut ties with Beijing, its largest trading partner. The disclosure follows a major diplomatic mission to China and highlights the mounting difficulty for small nations to navigate the US-China geopolitical rivalry. (IntelliNews)

  • Argentina: Poverty drops to 28.2% in late 2025, a seven-year low
    Official data shows a 10-point year-on-year decrease in poverty, reaching its lowest level since 2018 under the Milei administration. However, analysts warn of a potential stabilization or slight increase in the coming months due to rising unemployment and stagnant wages. (La Nacion)

  • Brazil: Iran war energy shocks drive 2026 inflation forecasts to 4.71%

    Economists have raised inflation projections for the sixth consecutive week as rising fuel prices from the Middle East conflict impact the domestic economy. The pressure complicates Central Bank plans to lower interest rates ahead of national elections. (Bloomberg Línea)

❐ MARKET INTELLIGENCE

❍ AGRIBUSINESS & FOOD SYSTEMS

  • Brazil: Agribusiness reaches 24.4% of GDP as industrial share fades
    Agribusiness is reshaping Brazil’s economy, with its total supply chain projected to reach 24.4% of GDP in 2025, significantly outpacing total manufacturing. While the official agricultural share is 7.1%, specialists highlight a structural shift where commodities are gaining ground over a weakening industrial sector. (Valor International)

  • Chile: Cold chain infrastructure expansion targets $2.8 billion cherry market
    Investments in cold storage and port infrastructure are strengthening Chile’s food export capacity, particularly for the high-value cherry sector which exported $2.85 billion in 2024/25. New facilities in Talcahuano and potential modular nodes in the Far North aim to reduce product loss and capture growing global demand for frozen fruit. (InvestChile)

❍ MINING & CRITICAL MINERALS

  • Brazil: US pressure mounts over critical mineral processing chokepoint
    While Brazil holds 95% of global niobium reserves, it faces a strategic chokepoint in processing and refining, stages currently dominated by China. Washington is applying pressure to secure MOUs, but experts warn Brazil lacks the institutional and financial infrastructure to fully leverage its mineral wealth. (Peterson Institute)

  • Argentina: Congress eases glacier protections to unlock $40 billion mining potential
    A new law transfers the responsibility for identifying protected glacier areas to provincial governments, facilitating mining activities in previously restricted zones. Proponents argue the reform empowers provinces to utilize resources, while environmentalists warn of threats to vital water reserves for seven million people. (BBC)

  • Colombia: Strategic lag in the race for "minerals of the future"
    Colombia is falling behind regional neighbors like Chile and Peru in securing supply chains for lithium, copper, and rare earths. Structural barriers, including uncertain regulatory frameworks and socio-environmental conflicts, continue to hinder the investments needed for the energy transition. (Bloomberg Línea)

❍ ENERGY & SUSTAINABILITY

  • Mexico: President Sheinbaum weighs "sustainable fracking" for energy sovereignty
    To reduce reliance on US natural gas, Mexico is exploring "sustainable" extraction methods for unconventional deposits while avoiding the term "fracking". A technical committee will evaluate less harmful drilling techniques as global energy markets remain disrupted by Middle East tensions. (Seattle PI)

  • Colombia: Barzalosa solar park secures $360 billion COP financing
    The 130 MWh Barzalosa project in Cundinamarca has closed financing with Bancolombia and the FDN, backed by a 15-year PPA. This project marks a milestone as the first of its kind under this specific sponsorship model in Colombia, aiming to avoid 150,000 tons of CO2 emissions annually. (Cuatre Casas)

  • Chile: Overhaul of electricity distribution and $510 million wind project
    Chile is reviewing a major regulatory reform to modernize its electricity distribution sector, focusing on smart meters and flexible tariffs. Simultaneously, the $510 million "Las Lilas" wind park, including 110 MW of battery storage, has entered environmental assessment. (Strategic Energy / Revista EI)

  • Paraguay: Strategy launched to become a regional carbon economy hub

    The inaugural Paraguay Carbon Forum outlined plans to generate and sell high-quality carbon credits by leveraging the country's vast forest ecosystems. The government aims to attract green investment and position Paraguay as a competitive player in the global decarbonization agenda. (Asuncion Times)

❍ MANUFACTURE & INDUSTRY

  • Mexico: Tech exports overtake automotive as leading export sector
    Computer equipment exports surged by 145% in 2025, knocking automobiles off the top spot as Mexico’s primary export. This boom, driven by Jalisco and Chihuahua, is fueled by US demand for data center infrastructure and a shift away from Chinese technology. (Mexico News Daily)

  • Brazil: GPU tariffs maintained despite push for AI infrastructure
    The government eliminated import tariffs on 970 IT and medical products but maintained taxes on GPUs, citing a lack of domestic manufacturing. Technology industry leaders warn this decision increases costs for data centers and limits Brazil’s competitiveness in the artificial intelligence race. (BN Americas)

❍ INFRASTRUCTURE, TRANSPORT & LOGISTICS

  • Peru: Integration of Chancay Port with Amazon faces logistical hurdles
    The new Chancay megapuerto moved over 286,000 TEU in its first year, but fully capitalizing on its potential requires better connectivity with the Andes and Amazon. Risks of deforestation and a lack of regional infrastructure remain key challenges for sustainable development. (Bloomberg Línea)

  • El Salvador: $2.3 million investment in El Zapote aerodrome for tourism
    The government has inaugurated the renovated El Zapote aerodrome in Ahuachapán to boost connectivity for coastal tourism and regional integration. The project includes a new one-kilometer paved runway and immigration offices, supporting the country's "Open Skies" policy. (Aviacion Online)

  • Venezuela: American Airlines plans to resume flights

    American Airlines plans to resume Miami-Caracas flights in April 2026 following a diplomatic thaw after the capture of Nicolás Maduro. (DW)

❍ DEFENSE & SECURITY

  • Brazil: Defense industry reaches 4.3% of GDP amid global instability
    The defense sector has gained relevance as a developer of strategic technologies like cybernetics and automation, but experts call for better coordination between the military and private industry. Financial predictability remains a challenge, with over 90% of the defense budget currently consumed by personnel costs. (Valor International)

❍ HEALTH & LIFE SCIENCES

  • Ecuador: Strategic mission to Spain targets healthcare digital transformation
    Vice President María José Pinto is coordinating with Spanish authorities and global firm Dedalus to implement Hospital Information Systems (HIS) in Ecuador. The initiative aims to modernize clinical data management and strengthen primary care efficiency through data-driven resource optimization. (Vistazo)

❍ TECHNOLOGY & INNOVATION

  • Bolivia: $30 million capital injection to boost MSME innovation
    The Bolivian state and CAF have injected $30 million into the Banco de Desarrollo Productivo (BDP) to finance technological innovation for micro and small enterprises. This funding specifically targets rural productive units underserved by traditional commercial banks to stimulate domestic demand and economic recovery. (Urgente.bo)

❍ FINANCE & BANKING

  • Chile: Mercado Libre announces record $750 million investment for 2026
    Mercado Libre plans its largest-ever investment in Chile to expand its logistics network and Mercado Pago financial services. The expansion will create 1,200 new jobs, bringing the company’s total workforce in the country to 5,000 by year-end. (BioBio Chile)

❍ TOURISM, CULTURE & CREATIVE INDUSTRIES

  • Brazil: 2026 arrival forecast raised to record 11.5 million visitors
    Brazil recorded a historic 2.6 million foreign arrivals in the first two months of 2026, a 22% increase over 2025. Authorities have adjusted year-end expectations upward, fueled by a strong US dollar, relaxed visa rules for China and Mexico, and expanded flight routes to regional hubs like Salvador and Foz do Iguaçu. (Tourism Review)

❍ TRADE & INVESTMENT POLICY

  • Colombia and Ecuador: Trade war escalates with 100% reciprocal tariffs
    Colombia has matched Ecuador’s "security tax" by raising tariffs on Ecuadorian imports to 100%, following a breakdown in diplomatic efforts. Tensions are high due to border security disputes and conflicting views on regional political stability. (France 24)

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The opinions and views expressed in this publication are solely those of the author. They do not represent, and should not be interpreted as representing, the official positions of any organization with which the author is or has been affiliated.

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