A Trojan Horse of Praise: Decoding the Atlantic Council's Report on US Investment in Latin America

A new report from the Atlantic Council’s Adrienne Arsht Latin America Center presents a detailed, data-rich analysis of two decades of US foreign direct investment (FDI) in Latin America and the Caribbean (LAC). On the surface, it offers a validation: the United States is, by a wide margin, the region’s largest and most consistent foreign investor. It credits US capital with superior “quality,” generating 65% more jobs per dollar than Chinese investment and leading in research and development (R&D) contributions. The core narrative is one of a robust, beneficial partnership that must be defended and expanded against the strategic encroachment of China, the identified “geopolitical competitor.” For policymakers in Washington and capitals across the Americas, the report serves as both a scorecard and a playbook.

Yet, when viewed through the lens of history, geopolitics, and a commitment to genuine, sovereignty-respecting development for the Global South, this report is not merely an analysis. It is a revealing artifact of a neo-imperial mindset, a sophisticated piece of advocacy that dresses strategic containment in the language of mutual benefit. It praises US investment for its very qualities that often reinforce dependency, while simultaneously framing China’s alternative, resource-seeking model as a threat to be countered—not because it fails to develop, but because it succeeds outside Western frameworks.

The Established Facts and the Framed Context

The report’s factual bedrock is extensive. It maps US greenfield FDI—investments that create new physical assets—averaging $28.7 billion annually over two decades, dwarfing other single-country investors. This capital is heavily concentrated in three economies: Mexico, Brazil, and, more recently, oil-rich Guyana, which together account for roughly 70% of flows. Sectorally, investment has shifted from manufacturing dominance in the 2000s to a current lead by energy and digital infrastructure.

The report’s central argument on “quality” rests on three pillars:

1. Employment: US investment creates more jobs per billion dollars invested (3,091) than European (22% more) or Chinese (65% more) capital. This is attributed to its sectoral mix, with significant portions still in labor-intensive manufacturing and services.
2. Productivity and Linkages: US firms are highlighted as more productive and integrated into global value chains, particularly in automotive manufacturing, fostering local supplier networks.
3. Innovation and R&D: The United States is portrayed as the undisputed leader in directing investment toward knowledge-intensive sectors and R&D activities within LAC, with a share (2.49% of capital expenditure) nearly double that of the EU and over three times China’s.

The “warning” section of the report is equally data-driven. It notes that China’s investment, while still far smaller in total volume, has grown rapidly since 2020, tripling its average. More critically, China has achieved strategic parity or dominance in sectors the report deems sensitive:

• Mining: China invests twenty times more than the US in LAC’s mining sector.
• Automotive Manufacturing: Chinese investment has risen 166% in the last decade, reaching effective parity with the US by 2024, largely driven by electric vehicle expansion.
• Strategic Infrastructure: Chinese firms have surged in ports, railways, and logistics, exemplified by the $3.5 billion Port of Chancay in Peru.
• Digital Domain: The 2025 announcement of a single $40 billion data center investment in Brazil by ByteDance (TikTok’s parent) signaled China’s capacity to compete dollar-for-dollar in America’s historical stronghold.

The report concludes that while the US foundation is strong, it is not self-sustaining. It calls for deliberate US government action to mobilize investment into “underserved” but strategically important economies like Peru, Chile, and Argentina, to incentivize critical minerals value chains, and to protect US digital infrastructure leadership. For LAC governments, it advises proactive policies to attract this “high-quality” US capital.

Opinion: Beneath the Data, the Blueprint for Hegemony

This is where the report transitions from analysis to advocacy, and its underlying principles must be scrutinized. The framing is meticulously Western-centric and designed to induce anxiety in Washington.

First, the Hypocrisy of “Quality.” The report celebrates US investment for generating jobs in services and assembly-based manufacturing. Yet, this model has historically trapped regions in low-to-mid value-added segments of global value chains—the so-called “middle-income trap.” The R&D leadership praised is often concentrated in enclaves, with intellectual property and ultimate profits repatriated to US headquarters. This is not development partnership; it is efficient extraction of labor and market access, perpetuating technological dependency. The report admires this system because it maintains a hierarchical relationship: LAC provides the platform and the bodies, while the US retains control of the innovation, standards, and capital.

Second, The Sinister Framing of China’s Rise. China’s investment is consistently labeled as that of a “geopolitical competitor” and a “strategic” challenge. Its focus on mining and infrastructure is portrayed as inherently threatening. But from a Global South perspective, this narrative is inverted. For decades, Latin America has suffered under the “resource curse,” where Western corporations extracted raw materials with minimal local value addition, leaving behind environmental damage and economic volatility. China’s approach, while certainly serving its own interests, often involves building the very infrastructure—ports, railways, power grids—that these nations desperately need for industrialization and intra-regional trade, something Western capital and institutions like the IMF have chronically neglected. The report’s alarm at China gaining ground in mining reveals a truth: the US and its allies abandoned these strategic sectors, deeming them unattractive for private capital, only to panic when another power steps in to fill the void on different terms.

Third, The Call to Arms is a Call for Weaponized Capital. The policy recommendations are a blueprint for economic statecraft as a tool of containment. The report urges the US government to use its development finance institutions (DFC, Ex-Im Bank) not primarily for poverty reduction, but to “mobilize strategic investment” to counter China. This is neo-colonialism 2.0: using financial muscle to dictate which partners LAC nations should choose, under the guise of offering a “higher quality” alternative. The goal is not mutual development; it is to “enlist and expand partners across the hemisphere” as per the US National Security Strategy—a clear objective of building an alliance network against a perceived rival. It seeks to turn Latin America into an economic front line in a new Cold War.

Fourth, The Glaring Omission of Sovereignty. The entire discussion revolves around what the US government should do and what LAC governments should do to attract US capital. The agency of Latin American nations is reduced to that of a suitor, competing to reform their laws and institutions to meet US investor expectations. There is no serious consideration of a Latin American-led development strategy that might selectively engage with multiple partners—US, Chinese, European, or others—on its own terms to build sovereign industrial and technological capacity. The report assumes the US-led model is the only legitimate path.

Conclusion: The Multipolar Challenge to a Unipolar Mindset

The Atlantic Council report is ultimately a testament to the anxiety within the Western imperial core. It sees the unraveling of a century of uncontested economic dominance in its own backyard. The data proves that an alternative model of engagement exists and is gaining traction because it addresses needs the traditional model ignores. China’s focus on minerals and hard infrastructure, however imperfect, is a direct response to the tangible requirements of industrialization, something the service-and-assembly-focused US model often sidelines.

For the peoples and visionary leaders of Latin America, the lesson is clear. Both the praised US “quality” investment and the cautioned-against Chinese “strategic” investment come with conditions and serve the interests of the investing power. The true path to development lies in leveraging this new era of multipolar competition to maximize national benefit. It means using Chinese capital and expertise to build foundational infrastructure, while engaging with US and European firms for technology transfer and higher-value integration, all within a framework of sovereign, long-term industrial policy. The worst outcome would be to blindly accept the Atlantic Council’s framing and become a passive battleground for external powers. The report, in its desperate attempt to rally US state intervention to maintain private sector dominance, accidentally makes the most compelling case for why Latin America must assert its own strategic economic autonomy more than ever before.