If Latin America has a commercial capital, it’s Miami

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fOR JOAN DIDION, an American essayist, in the 1980s Miami was “not exactly an American city…but a tropical capital: long rumours, little memory, overbuilt on the chimera of runaway money”. Almost 40 years later, the place Didion describes is still more a tropical capital of Latin America than a typical city in the United States. But the money flowing in is not a chimera.

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Miami has become a commercial center for the hemisphere. Miami-Dade County, which includes the city of Miami and around three dozen municipalities, is home to 1,200 multinational corporations that have established their Latin American operations as their headquarters. those of the district GDP was about $172 billion in 2019, making it the 14th largest economy in the United States and about the size of the overall economy GDP from Ecuador and Uruguay. Miami’s airport handles 43% of all flights from the United States to South America. It’s the “meeting place of the hemisphere,” says Alejandro Portes of Princeton University. “It’s easier to commute to Miami from Latin American capitals than it is between Latin American capitals,” he says.

With more than half of its residents born outside the United States, Miami has the largest immigrant population of any metro area in the country. About 70% of the county’s 2.7 million residents are Hispanic, about twice the number in 1980. The population is becoming increasingly diverse (see chart).

Recent geopolitical shocks like the war in Ukraine and the chillier US-China relationship have made Miami more relevant, argues Mauricio Claver-Carone, president of the Inter-American Development Bank (IDB) who comes from the city. He sees a trend towards “regionalization” versus “globalization”. This plays to Miami’s strengths as a Latin American hub. “There is no larger city that embodies the heterogeneity of Latin America and the Caribbean,” he says.

The turmoil in Latin America has often boosted Miami’s fortunes. When the communists took control of Cuba in 1959, Cubans with money or get-up-and-go fled the island and flocked to Miami. Next came Nicaraguans fleeing a socialist revolution and civil war that followed in the 1970s. From the mid-1990s, Colombians fleeing drug-related violence flocked to the country. All of these groups have thrived and contributed to Miami’s prosperity.

The city benefits in good times and bad, says Jorge Perez, head of a real estate company. People from unstable neighborhoods are buying homes in Miami as a “safe investment,” he says. After the elections of left-wing leaders in Peru and Chile last year, the number of people leaving those countries has increased, says Paulo Bacchi of Artefacto, a furniture store. And when Latin American economies are doing well, people buy second homes.

The bass and the sunset low

The Belen Jesuit Preparatory School was founded in Havana but closed in 1961 by its most famous old boy, Fidel Castro. Undeterred, he moved to Miami. His staff, many of them Catholic priests, now teach children whose families come from across the region. “Latin America’s losses are our gains,” says Father Guillermo Garcia-Tunon, the school’s president. And lately, Americans have also been applying in large numbers, moving to Florida for the sunshine and low taxes.

The political upheaval that is driving people to Miami is hardly letting up. Many desperate Haitians and Cubans — fleeing gang violence, poverty, or socialism — have tried to get to South Florida by boat. Since October 2021 the US The Coast Guard intercepted 3,519 Haitians, more than in the previous four years combined.

In this salsa merengue melting pot

And when more leftists get elected in Latin America, more conservative guys can vote with their feet. Some Colombians are nervous at the prospect of Gustavo Petro, a former guerrilla fighter, winning this month’s presidential election. Capital flight from Colombia is already evident, says Paul Angelo of the Council on Foreign Relations, a think tank. People fear Mr Petro will turn the country into “another Venezuela,” he says. In March, Colombia was the top source of international searches on MiamiRealtors.com, a real estate website, which accounted for about 11% of international traffic. Members of the Colombian Armed Forces have questioned Mr. Angelo about the US asylum process because they fear they could be targeted by left-wing guerrilla groups if Mr. Petro is elected.

Miami also appeals to younger tech types. Its startup scene is thriving. Entrepreneurs find safety and ample capital there, making Miami “a no-brainer in a post-Covid world,” says Shu Nyatta, who co-heads a Latin American fund at SoftBank, a big tech investment firm. Today there are around 2,500 fintech companies in Latin America. That is more than twice as many as in the region in 2018 IDB. Many Latin American founders choose to either settle in Miami or work there part of the year.

Members of the Latin American diasporas in Miami are becoming increasingly involved in regional affairs. Analysts tend to agree that Latin America is not a foreign policy priority for President Joe Biden. Eight Latin American countries, including Brazil and Chile, still have no ambassadors from the United States. Chile hasn’t had one for three years. But American politicians care about their constituents, and that includes many people with ties to both hemispheres.

After Hurricane Maria hit Puerto Rico in 2017 and sent an estimated 50,000 Puerto Ricans to Florida, Republicans feared those migrants would vote for Democrats. Perhaps for this reason, Donald Trump tightened sanctions against Venezuela’s dictatorial regime and supported the opposition, knowing it would please Venezuelans in south Florida who had fled their country.

Venezuelans in the United States have indeed been “galvanized” by Mr Trump’s move, says Erik Bethel, a former World Bank director who grew up in Miami. They voted for Mr. Trump in droves. Colombian voters are also gaining ground, says Annette Taddeo, a Florida state senator running for governor.

“Miami is a city shaped much more by exile than immigration,” says Alberto Ibarguen, a former publisher of Miami Herald. While most recent immigrants try to assimilate, Miami’s exiles have often hoped to return to their homeland. That might change. As Miami continues to tilt to the right, Latin America is poised to tilt further to the left.

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