Executive Summary

The Big Picture: President Trump hosts 12 right-aligned Latin American leaders at his Doral resort today for the inaugural “Shield of the Americas” summit — a gathering designed to counter Chinese influence and formalise a hemispheric security bloc through the yet-to-be-signed Doral Charter. Brazil, Mexico and Colombia were not invited. The summit arrives in the same week that U.S. Special Forces began joint operations in Ecuador, Kristi Noem was fired from DHS and reappointed as the initiative’s special envoy, and the Strait of Ormuz entered its eighth day of effective closure, reshaping energy markets and monetary-policy calculations across the continent.

Brazil anchors the week’s corporate calendar. Petrobras reported fourth-quarter net profit of R$15.6 billion after Thursday’s close, reversing a prior-quarter loss, and declared R$8.1 billion in dividends — above the R$6.7 billion consensus. The Ibovespa fell another 0.61% on Friday to 179,364, extending its war-week decline to approximately 5.2% from Monday’s pre-crisis close. The Copom meeting on March 17–18 is the next inflection point: a 50-basis-point cut was widely expected before the geopolitical shock, and the DI curve is now repricing the trajectory.

Colombia votes tomorrow in the most consequential legislative elections in years. Over 3,100 candidates are competing for 286 congressional seats in a contest that will reshape Petro’s final legislative stretch and set the field for the May presidential election. Polls project a fragmented Congress with the Historic Pact leading and the Democratic Centre in second; neither will command a majority. Three presidential primaries are also on the ballot. The ELN declared a ceasefire for election day.

Chile enters the final four days before José Antonio Kast’s March 11 inauguration with the transition process still broken. Kast halted bilateral handover meetings with outgoing President Boric on March 3 after a dispute over the Chinese submarine cable project, and will attend the Doral summit today before returning for the ceremony. The U.S. revoked visas for three Chilean officials linked to the cable project.

Argentina’s Milei arrives at Doral as Trump’s closest regional ally, fresh off Senate passage of the labor reform and a bilateral trade deal. But at home, the UIA and AEA issued rare public rebukes this week after Milei called subsidised industrialists “thieves” in his March 1 congressional address. Factory closures and falling industrial activity are generating tension within the business class that initially backed his reforms.

Ecuador deepened its U.S. security integration this week after Special Forces began joint operations against designated terrorist organisations on March 3 — the most significant U.S. military footprint in Ecuador since the Manta base closed in 2009. President Noboa attends the summit today. He also raised tariffs on Colombian imports to 50% over drug-trafficking disputes.

Mexico was not invited to the summit. Sheinbaum presented her “decálogo por la democracia” electoral reform package to Congress this week and unveiled Plan Kukulcán, deploying up to 100,000 security personnel for the World Cup. Violence in Jalisco has continued since the killing of El Mencho in February.

— Twelve Leaders, One Host, No Big Three: Trump convenes the inaugural Shield of the Americas summit at Trump National Doral Miami today, hosting heads of state from Argentina, Bolivia, Chile (president-elect), Costa Rica, the Dominican Republic, Ecuador, El Salvador, Guyana, Honduras, Panama, Paraguay and Trinidad & Tobago. Brazil, Mexico, Colombia, Peru and Venezuela were not invited. The event replaces the postponed Summit of the Americas, which the Dominican Republic was to host in late 2025.

— Doral Charter Expected: The summit is expected to produce the Doral Charter, described by the White House as a document affirming the hemisphere’s right to “chart its own destiny free from interference” — understood as a reference to Chinese infrastructure, investment and Belt and Road agreements. The framing follows from the “Trump Corollary” to the Monroe Doctrine outlined in the 2025 National Security Strategy.

— Noem as Special Envoy: Kristi Noem, fired as DHS Secretary on Thursday, was immediately reappointed as Special Envoy for the Shield of the Americas. She will oversee the initiative’s implementation on immigration, border security and cartel operations. The appointment follows the Americas Counter Cartel Conference held at SOUTHCOM headquarters in Doral on March 4–5, led by Defence Secretary Hegseth.

— The Absent Three: Sheinbaum said Thursday she did not know the summit’s specific objectives and declined to comment further. Brazil’s absence reflects Lula’s independent posture on Iran, Venezuela and China. Colombia, heading into elections tomorrow, was also excluded. Analysts note that the twelve-nation format narrows the alliance to right-aligned governments and risks producing symbolic rather than structural outcomes.

— Legislative Elections Tomorrow: Over 3,100 candidates compete for 103 Senate seats and 183 House seats on March 8. Polls project the ruling Historic Pact as the largest force with 20–25 Senate seats, followed by the Democratic Centre with 17–19. No bloc will command an outright majority, guaranteeing a fragmented Congress that will shape the final stretch of Petro’s presidency and the May–June presidential race.

— Three Presidential Primaries on the Same Ballot: Voters will also participate in three inter-party presidential consultations: the Frente por la Vida (centre-left), Consulta de las Soluciones (centre) and Gran Consulta por Colombia (right). The results will set the field for the May 31 first-round presidential vote.

— FARC’s First Competitive Campaign: The 2016 peace accord granted former guerrillas ten guaranteed congressional seats for two terms; that grace period ends with this election. For the first time, FARC candidates must win votes on their own. The party’s brand remains deeply toxic: polls suggest most of its candidates will fail to secure seats, a decade after laying down arms.

— ELN Declares Ceasefire: The ELN, Colombia’s largest remaining guerrilla group, announced a unilateral ceasefire for election day, responding to the Colombian Episcopal Conference’s call for “electoral peace.” The EU deployed its largest-ever election observation mission in Colombia, with over 100 observers distributed across the country.

— Kast Halted Transition Talks: President-elect Kast suspended all bilateral handover meetings with outgoing President Boric on March 3, citing a lack of trust over information sharing. The rupture followed a 22-minute meeting at La Moneda that ended abruptly when Kast demanded Boric retract his claim that the incoming administration had been briefed on the Chinese submarine cable project. Boric refused. Interior Minister Elizalde confirmed that all minister-to-minister transition sessions were cancelled.

— Chinese Cable at the Centre: The Chile–China Express submarine fibre-optic cable project, backed by a China Mobile affiliate, is the precipitating dispute. A 30-year concession decree was signed on January 27 but reportedly annulled within 48 hours. The U.S. revoked visas for three Chilean transport ministry officials, including Minister Juan Carlos Muñoz, accusing them of compromising critical telecommunications infrastructure. Washington’s intervention converted a bilateral transition dispute into a U.S.–China flashpoint.

— Kast at Doral Before Inauguration: Kast travels to Florida for the Shield of the Americas summit today before returning for the March 11 ceremony. The sequence sends a clear signal: alignment with Washington before assuming office. He will be inaugurated as Chile’s first far-right president since the end of the Pinochet era, with 58.3% of the December runoff vote. He enters without a congressional majority; the Senate is evenly divided and the balance in the lower house rests with the People’s Party.

— UIA Breaks Silence: The Argentine Industrial Union (UIA) and the Argentine Business Association (AEA) issued rare public warnings to Milei this week, calling for “respect” for the productive sector after the president labelled subsidised industrialists “thieves” and “accomplices to looting” in his March 1 congressional address. UIA president Martín Rappallini said the entity is seeking a direct meeting with Milei. The statements mark the first significant public corporate pushback since Milei took office.

— Industrial Pain Deepens: The UIA warned that many firms, especially SMEs in northern provinces, face falling demand, high tax pressure and financing constraints. Argentina’s industrial sector produces 19% of GDP and contributes 27% of national tax revenue. A 55% surge in consumer-goods imports in 2025 under Milei’s tariff cuts has accelerated factory closures, most visibly in textiles where 16,000 jobs were lost.

— Milei at Doral: Milei arrives at the summit as Trump’s most ideologically aligned partner, backed by a $20 billion currency swap, increased beef-import quotas and a bilateral trade deal awaiting Argentine congressional ratification. He announced 90 legislative initiatives for 2026 in his March 1 address. The labor reform, passed by the Senate 42–28 on February 27, was his most significant legislative win; it relaxes hiring rules, extends working hours and limits the right to strike.

— Joint Military Operations Launched: U.S. Special Forces began advising and supporting Ecuadorian commandos on raids against designated terrorist organisations on March 3, SOUTHCOM confirmed. The operations target Los Choneros and Los Lobos, groups tied to Mexican cartels that use Ecuador’s Pacific ports as cocaine transit hubs. U.S. personnel are providing intelligence, surveillance, planning and logistical support while Ecuadorian units execute under national command.

— Most Significant U.S. Footprint Since 2009: The deployment is the largest acknowledged U.S. military presence in Ecuador since the closure of the Manta Forward Operating Location. It follows a December 2025 joint seizure of 1.4 metric tonnes of cocaine in Esmeraldas province and the return of U.S. Air Force personnel to the Eloy Alfaro Air Base. Ecuadorian voters rejected a constitutional amendment to allow a permanent U.S. base in 2024; the current operations proceed under a bilateral SOFA agreement.

— Colombia Tariff Escalation: Ecuador raised tariffs on Colombian imports to 50% on March 1, accusing Bogotá of failing to crack down on cocaine trafficking that transits through Ecuador. The move adds a bilateral trade dimension to the security crisis. Approximately 70% of cocaine produced in Colombia and Peru is estimated to transit through Ecuador.

Market Context

Friday’s session extended the war-week selloff. The Ibovespa fell another 0.61% to 179,364, its lowest close since late January, as the Petrobras dividend surprise failed to offset the ongoing Ormuz premium. The index has now lost approximately 5.2% from Monday’s pre-crisis close of 189,307. Mexico’s IPC dropped 1.56% to 67,313 — the steepest Friday decline — while COLCAP slipped 0.32% to 2,175 on the eve of Colombia’s elections. The MERVAL was the sole gainer, rising 2.15% to 2,626,115 as Argentine assets rallied on Milei’s Doral positioning and the post-labor-reform optimism. Chile’s IPSA edged up 0.16% to 10,314, holding above the 10,000 support with Kast’s inauguration four days away. The Strait of Ormuz remains effectively closed since early March, with tanker traffic down 90%. DI futures surged again: the Jan/28 contract climbed 19bp to 12.975%, repricing the Copom trajectory. Monday’s BCB Focus Survey is the key data point before the Copom silent period begins.