Nuevo Peru: On the economic sanctions of Yankee imperialism

We hereby publish an article publishe by Nuevo Peru:

CURRENT SITUATION. NOTES ON THE WORLD CRISIS (35.On the economic sanctions of Yankee imperialism)

Following what was announced during his electoral campaign, the new president of the United States, the ultra-reactionary and genocidal Donald Trump, has imposed a 25% customs tax on exports from Mexico and Canada to the US and a 10% tax on Chinese exports to its territory by means of presidential decrees, which he has sought to justify on the grounds of national security (drugs such as fentanyl; and illegal immigration). In order to be able to bypass internal legal norms and trade agreements with these States and the rules that govern international law.

It is clear that with the justification of “national security” he bypasses the Congress, which is in charge of establishing these economic measures as US laws, thus accumulating more authority in the person of the President. As it has been doing with its other executive provisions, for example, on immigration, thus advancing at a rapid pace in the greater reactionary nature of the Yankee imperialist State through the centralization of power in the president, presidential absolutism to the detriment of parliament.

The measures of the North American administration not only imply unilateral taxes on trade between countries but are true economic sanctions that, although they appear to be directed against those three countries, hit the exports of other countries that use Mexico, mainly, and Canada, to a lesser extent, as export platforms. That is, it hits German exports and those of other countries of the so-called European Union and China, again. But, it does not only have to do with trade but with other economic activities, as announced by the Spanish Bilbao Vizcaya Argentaria Bank (BBVA), which says that its banking activity will also be affected.

Trump’s most recent executive order is closely related to the other executive orders or presidential decrees issued since the inauguration of his second term, such as the one referring to the repeal of the previous administration’s regulations on electric cars in favor of the production of gasoline or diesel engine cars. Thus, the European manufacturers of these cars would have also benefited, just like the US manufacturers. These initial measures affect exporting companies not only from the named countries but from many others. In addition, it is expected that the economic measures will be expanded as sanctions against other countries, especially oppressed countries such as South Africa. In the case of Mexico, it not only pursues economic objectives but greater subjugation. The order to militarize the southern border and deportation of a number of “criminal” immigrants has served as a “legal argument” for the protectionist measures.

Yesterday, the White House announced that President Trump has scheduled a telephone conversation on Monday morning about customs duties with the Prime Minister of Canada and, later, with the President of Mexico.

What is he aiming for with these measures?

Donald Trump, the highest representative of Yankee imperialism, is seeking to negotiate new economic agreements from a position of strength with Canada and Mexico, as well as with China; but as the measure directly affects the EU countries, mainly Germany, he is seeking with this measure to prepare the ground for preferably bilateral agreements with these countries. Regarding this, it is important to quote the following from an article published by the Royal El Cano Institute of Spanish imperialism:

“From the perspective of the European Union (EU), this prospect heralds problems. On the one hand, because we can see that, with all his economic and technological power, he will seek to divide and weaken the Twenty-Seven by strengthening bilateral relations with each of them to the detriment of Brussels. To the extent that he cannot subordinate the whole Union to his plans, he will try to fuel the fragmentation that already exists, courting some (with Viktor Orbán and Giorgia Meloni at the head), while punishing others; all with the intention of contributing to the discredit of a project of political union that represents the opposite of what the magnate advocates. On the other hand, beyond the fact that his own figure will serve as an example to be followed by Eurosceptic and anti-European actors, determined to undermine the Union from within, he could take it upon himself to support them financially so that they can have greater capacity to promote the same anti-democratic ultranationalism that defines the next tenant of the White House.” (“Trump in imperial code”, Jesús A. Núñez Villaverde, January 15, 2025; our translation).

In the quote, the author is well informed of the plans of Yankee imperialism as the sole hegemonic imperialist superpower to divide the European imperialist alliance under German hegemony and subdue the different countries that make it up, a Yankee imperialist plan that with Trump takes a sharper and more belligerent form. But the author of the article is wrong when he wants to limit the collusion and struggle of the imperialist superpower with the imperialist alliance of the EU to a personal question of the “convictions of the magnate”. We do not agree, because in this way they want to exonerate Yankee imperialism, the imperialist State, because by recognizing the role of the individual, in this case of the imperialist genocidairy Trump, as the head of an imperialist faction, he is the one who embodies this bourgeois-imperialist State in a centralized Power as the absolutism of the president. Of course, these independent interests that are presented as an individual’s desire or whim, as the embodiment of the relative independence of the State from society – we repeat, represented in this case by “the magnate” – are exercised precisely when Yankee imperialist society is at risk, and it has to strike a faction or a part of the exploiters who endanger the interests of the whole, the interest of maintaining the sole hegemony of Yankee imperialism, so that is precisely when it assumes the class interests of the exploiters and oppressors, in this case, Yankee imperialism. Regarding Trump’s support for “Eurosceptic and anti-European actors, bent on blowing up the Union”, it is an objective convergence. That is why Musk intervened in German politics by supporting the AfD candidate.

Chairman Mao said in 1947: “The economic power of U.S. imperialism, which grew during World War II, is confronted with unstable and daily shrinking domestic and foreign markets. The further shrinking of these markets will cause economic crises to break out. The war boom in the United States of America was only temporary. The strength of the United States of America is only superficial and transient. Irreconcilable domestic and international contradictions, like a volcano, menace U.S. imperialism every day. U.S. imperialism is sitting on this volcano.” The long process of collapse, which has tormented Yankee imperialism from then until today, shows the just and correct judgment of Chairman Mao. Yankee imperialism with the new government expresses a greater political decomposition, as part of its process of greater decomposition in all orders.

The principles on which Trump, as the head of Yankee imperialism, is based are the same as those that Zbigniew Brzezinski (Johnson’s campaign advisor from 1966 to 1968; and security advisor to US President Jimmy Carter from 1977 to 1981; and consultant at the Center for Strategic and International Studies (CSIS) in Washington, D.C.) set out in his book “The Grand Chessboard (1997)”, as the guidelines of the strategy that the United States should follow, among others, which are:

“The main interest of the United States must be to help ensure that no single power gains control over (Eurasia) this area of geopolitical importance and that the world community has unhindered economic and financial access here.

The United States is the only superpower in the world today, and Eurasia is the central stage. The question of how power is distributed on the Eurasian continent will therefore be of vital importance to America’s global supremacy and historical legacy.

The three most important imperatives are imperial geostrategy: avoiding collusion among vassals and preserving their security dependence, keeping tributary states docile, and protecting them to ensure that “barbarian peoples do not unite.

Given the climate of people on the political horizon of Europe and Asia, any successful American policy must focus on Eurasia as a whole and be guided by a geostrategic plan. (…) This requires a high degree of tactics and manipulation so that an opposition coalition does not form that could ultimately call into question the primacy of the United States (…).”

THE INTERIMPERIALIST CONFLICT IN LATIN AMERICA

With reference to later comments, we quote from the same institute of Spanish imperialism the report: “Why does Latin America matter?”, Carlos Malamud, José Juan Ruiz and Ernesto Talvi (eds.), Report 32 | June 2023, Elcano Royal Institute – Madrid – Spain www.realinstitutoelcano.org, the part that says:

„3.2. China as a competitor and a market

China has become a formidable competitor when it comes to emerging economies. However, the EU and the US remain the main export markets for emerging economies.

The combined total of US and EU imports from emerging economies is almost double the figure for China. Moreover, taken separately, US and EU imports are similar and comparable to China.

However, as a competitor and a market for Latin America, China presents two different realities. China is an extremely small export market for Mexico and Central America, compared with the dominant player (the US). A total of 92% of Mexico and Central America’s exports to the three main economic blocs (the US, the EU and China) are destined for the US.

The opposite is true in South America. China is the main export destination, outstripping the combined total for the EU and the US. In terms of imports from China, participation is more balanced for Mexico and Central America and shares a similar pattern to Chinese imports in South America.

3.3. China as a buyer and seller of primary and manufactured goods

Given the limited scale of China’s trade with Mexico and Central America in relation to the US, this section will focus on South America, where the situation is markedly different.

What does China buy from South America and what does it sell? The region is a major exporter of natural resources and commodities, manufactured products derived from natural resources and in the agro-industry sector. These make up 80% of the region’s total exports and China is the main buyer (37% of the total), above the combined total for the EU and the US.

South America is a major importer of manufactured goods (70% of the total), most of which come from China (35%), whose share is equal to the combined total for the EU and the US (Figures 30b and 30g). China is the main exporter of high-tech manufactured goods to South America, making up 30% of the total (also higher than the combined total for the EU and the US).

The trade relationship between South America and China is highly asymmetric: the former sells natural resources and primary products (and associated manufactured goods) and buys medium- and high-tech manufactured goods. Even though the agro-industrial chain and the industrialisation of natural resources contain segments with high value-added and highly sophisticated manufactured goods, these chains primarily produce and export commodities, whose prices are determined on the

global market.

South America exports a small amount of high value-added and highly sophisticated manufactured goods. But where do these exports go? Half are sold to the US and the EU, while just 6% are destined for China.

…

3.4. China as an investor

While anecdotal evidence suggests Latin America is on the receiving end of an avalanche of Chinese investment in infrastructure and other strategic areas in order to secure a ready supply of natural resources and food, the data paint a different picture.

First, Latin America is the emerging region with the lowest direct investment from China, whose stock of FDI amounts to little over 1% of GDP.

Secondly, the stock of Chinese investment only exceeds 5% of GDP in one country: Panama.

Third, total EU and US investment stock in Latin America is 20 times the figure for China.

One possible objection to this analysis is that cumulative stocks reflect the past, not the present or the future. Figure 31d shows FDI flows between 2010 and 2020. The bulk of all investment projects and mergers and acquisitions originated in the US and EU. Moreover, while China’s share of FDI flows is higher than for investment stocks, the figures for the EU and the US are five times higher.

3.5. China as a lender

Just like on investment, the narrative suggests that not only does China dominate the provision of bilateral loans to countries in the region, it is also competing with multilateral institutions like the IMF and the World Bank as a source of finance.

But once again, the data tell a different story.

First, together with South Asia, Latin America is the emerging region with the lowest levels of indebtedness to China.

Secondly, the stock of bilateral loans from China –including the figures for its development banks (its main source of foreign financing)– only exceeds 5% of GDP in Venezuela, Ecuador, Bolivia, Suriname, Guyana, Jamaica, the Bahamas and Dominica.

Third, flows and stocks of bilateral Chinese loans have fallen sharply since 2017, following the sharp slowdown in China’s growth, and payment difficulties in debtor states have forced the country to repeatedly restructure and cancel loans.

The fall in Chinese loans to Latin America, coupled with the rise in loans from the IMF and the World Bank during the pandemic, has reduced its share as a creditor to just 11% of all loans to the region from the IMF, the World Bank, the Paris Club and China.

If we include bonds issued by Latin America under international jurisdictions (85% of which are Western jurisdictions, primarily New York and London), China’s share of total credit to the region is just 3%.

3.6. China in the military sphere

China has almost no influence in the military sphere. Not only are Chinese arms sales to Latin America the lowest across all emerging regions, no sales were recorded in 2020 and 2021. During these two years, the region’s arms purchases were from the EU and the US, with South America favouring the former and Mexico and Central America favouring the latter.

A total of 90% of arms purchases by Mexico and Central America were from the US, while almost 60% of sales in South America came from the EU –a ratio of four to one–.

3.7. China and Latin America: tourism, higher education migration

In terms of human ties with Latin America, there is a huge gulf between the West and China. The US predominates almost exclusively in Mexico and Central America. Over 90% of tourism involves the US. Similarly, 60% of Mexican and Central American students who study abroad do so at US universities, 97% of migrants live in the US and 97% of international transfers from Mexican and Central American immigrants come from the same country of origin.

In contrast the EU is the main partner in South America. The former accounts for 56% of the latter’s inbound tourism and 52% of outbound tourism. A total of 60% of South American students who study abroad do so at European universities and 50% of South American migrants live in the EU. This dynamic means that a similar percentage of international transfers originate from EU countries.”

And the report on the cited part concludes:

“Conclusions

In barely 30 years, China has risen to become a global economic giant whose size is on a par with the US and the EU. It is only natural that its share of global trade has increased. Yet despite the formidable increase in its share of global GDP and trade, China is underrepresented across all three areas: as an export market for products of medium or high sophistication; FDI; and financial, human and military relations.

The EU and the US remain the dominant forces in Latin America: Mexico and Central America have strong ties to the latter in all areas, while South America can be regarded as ‘more European’ in all areas except for trade.

Once again, careful analysis of the data challenges the received wisdom: neither the EU nor the US have abandoned Latin America and nor has China become the dominant force in the region.”