What Became of Kamala Harris’s Outreach to Central America

Migration Unresolved: State-Sponsored Investment Proves No Match for Underlying Drivers

Northern Triangle

Although Harris’s plan mentioned strengthening the rule of law, those efforts appear to remain on paper. (Sebastián Díaz)

Lea en español.

  • This year, Kamala Harris announced $5.2 billion in committed private investment for the Northern Triangle, after promising in 2021 to bring billions of foreign investment to the region. However, only $1.3 billion has been reported as disbursed. Some of that is legitimate capital formation, but the majority appears to be for education and microloan campaigns.
  • The remaining funds are slated to arrive in the next five years as part of public-private partnerships, which imply crony protectionism as an incentive. However, they may fail to proceed, given unpredictable and potentially adverse political climates.
  • Illegal immigration to the United States stems from both push and pull factors. On the pull side, a specialist interviewed by the Impunity Observer notes perverse incentives within the asylum system. These encourage phony requests and an enormous backlog of cases, leading to years of waiting before any hint of enforcement.

At the end of July 2024, Vice President Kamala Harris’s efforts to address illegal immigration at the US southern border drew criticism, given the lack of positive results. Concerns spiked after President Joe Biden resigned from the presidential race and Harris became his successor candidate.

In 2021, Biden tasked Harris with tackling illegal immigration from Central America, focusing on the troubled Northern Triangle countries: El Salvador, Guatemala, and Honduras. She released a plan to address migration’s root causes through long-term solutions, especially by encouraging private-sector investment in these nations to create economic opportunities.

A March 2024 State Department report indicated Harris had secured $5.2 billion in investment commitments intended to enhance economic activity in the Northern Triangle. However, with three months left of the Biden presidency, only $1.3 billion of this investment has been documented: $141 million in El Salvador, $509 million in Guatemala, and $545 million in Honduras. 

Rather than physical capital formation, the funded projects have focused on digital and entrepreneurial skills training for women and low-income entrepreneurs, financial inclusion, microloans, and digital insurance for low-income workers and small farmers. While these projects have reported preliminary results—such as the number of trained women—concrete information on the impact of these touted investment initiatives remains scant. 

This investigation explores the key trends associated with Harris’s tenure of combating illegal immigration from the Northern Triangle. Beyond gathering the most pertinent data, the Impunity Observer interviewed prominent Miami-based immigration lawyer John De la Vega to gain firsthand insights into illegal-immigration trends.

Harris’s Strategy, Its Shortcomings

In 2021, when Harris outlined her migration strategy, she emphasized the need to strengthen democracy, the rule of law, and economic opportunities in the Northern Triangle. The plan included collaboration with governments, the private sector, and civil society in El Salvador, Guatemala, and Honduras. Harris also sought to work with Mexico and other Western Hemisphere nations to address migration jointly.

Her strategy proposes five approaches to strike the roots of illegal migration. 

  1. Tackle key impediments to economic development by fostering a business-friendly environment, increasing and diversifying trade, enhancing workforce development, and building resilience to climate-changing conditions. 
  2. Combat corruption and strengthen the rule of law by encouraging governments to implement legislative reforms for more transparent and participatory elections, avoid conflict of interests in the selection of judges, improve fiscal and operational transparency, and provide services in marginalized communities.
  3. Uphold human rights, labor rights, and press freedom, particularly those of marginalized populations—which include “women and girls, indigenous, Afro- descendent, and LGBTQI+ populations.” The US government has proposed to work with civil-society organizations, labor rights activists, and media. 
  4. Counter and prevent violence and criminal organizations’ proliferation by fostering the capabilities of security forces, promoting regional cooperation to combat narcotics and other illicit trafficking, and promoting initiatives to prevent youths from joining gangs. 
  5. Combat sexual, gender-based, and domestic violence by ensuring law enforcement, access to justice, and victim support. 

To channel private funds into the Northern Triangle, the US government created a 501(3) tax-exempt nonprofit called the Partnership for Central America. Hence, the private enterprises contributing to Harris’s strategy would be able to claim the so-called investments as charitable donations. Any distributed funds are de facto public spending, since the US government is coordinating where and how to allocate them. According to the US State Department: “The Partnership for Central America aims to coordinate practical solutions to advance economic opportunity; address urgent climate, education, and health challenges; and promote long-term investments and workforce capability in support of a vision of hope for Central America.”  

The strategy is divided into three phases. First, the US government claimed to build coalitions with communities, organizations, and businesses to create economic opportunities in Guatemala, Honduras, and El Salvador. In the mid term (now), the strategy attempts to promote legislative reforms and start communicating results. In the undefined long term, the plan is for US officials to deepen partnerships, institutionalize programs, and foster regional integration. 

Currently, the strategy is in the second phase—the mid term. Therefore, the preliminary results have been the following: 

  • Conectadas, a program conducted by telecommunications company Millicom, has trained over 160,000 women in digital literacy across El Salvador, Guatemala, and Honduras. The project started in 2017, but Millicom has expanded its reach since 2022 through a web-based app in 2022 and launched a special program to train education professionals with online teaching skills. The Rafael Meza Ayau Foundation has “strengthened” 98 nonprofits, built school labs for 4,000 students, and provided early-childhood care services.
  • Mastercard’s RocketPOS has enabled over 6,000 microbusinesses, primarily female-owned, to accept digital payments. LAFISE Bank expanded its agricultural loans from $345,000 to $40.2 million, specifically targeting small farmers in Honduras. Financial firm Deetken raised $17.5 million for financial inclusion in El Salvador, while peer CrossBoundary secured $6.9 million for tech businesses serving low-income communities.
  • Pantaleon, an agricultural firm, invested $25 million in Synergy Industrial Park, attracting business to Guatemala and training women as tractor operators. Pantaleon is also investing $1 million annually in local upskilling programs. Gap Inc. plans a $150 million sourcing expansion in Central America by 2025 and has trained 2,000 women in the region. Grupo Bancolombia supported over 500 small and medium enterprises (SMEs), providing $19.5 million in loans and training women-led businesses.
  • PriceSmart contributed $300,000 to training 80 Guatemalan women-led SMEs. It also opened new clubs in El Salvador and Guatemala, creating 225 jobs. Heifer International invested over $770,000 to support indigenous and cacao-producing entrepreneurs in Guatemala and committed $4 million for dairy farmers in Honduras.
  • Agri-multinational Cargill has expanded its outreach to over 18,000 children and 4,500 farmers in Guatemala and Honduras through school meal programs and technical assistance. In coffee, JDE Peet’s, CoHonducafe, and Grupo Cadelga supported 10,512 farmers, generating $90 million in sales and providing $3.7 million in credit. Root Capital channeled over $12.5 million in loans to coffee cooperatives in Honduras, while Nestlé launched a regenerative agriculture initiative that aims to reach 100,000 youth in Honduras.

The emphasis on projects like financial literacy, while important, does little to tackle the fundamental drivers of migration, such as violence, corruption, and political instability. In fact, the émigrés are likely making a financially sound decision when they opt to leave. Mobilizing private funds, rather than taxpayer dollars is notable, but few of the private dollars have gone to capital formation. In the meantime, the projects have not led to the widespread job creation or the economic growth initially envisioned. 

Government-Backed Investment Is No Match for Remittances

According to the International Organization for Migration, remittances to Guatemala, Honduras, and El Salvador rose by 4.2 percent in the first half of 2024, reaching $18.95 billion. In 2023, remittances totaled $37.16 billion, compared to $34.48 billion in 2022—a 7.8 percent increase. These figures far exceed the $1.3 billion disbursed from Harris’s initiative, underscoring the remittances’ relevance as a lifeline for many local families.

De la Vega, who has closely followed migration trends, highlighted this disparity: “When people seek economic opportunities in the United States, they will migrate regardless of any commitments made by investors in their home countries … Further, once they arrive, many remain in limbo for seven to eight years without leaving.” This points to the complexity of the migration challenge, which cannot be solved with centrally planned economic investment. That is particularly the case if other factors, such as legal and political conditions, remain unaddressed.

Although Harris’s plan mentioned strengthening the rule of law, those efforts appear to remain on paper. The Northern Triangle continues to suffer from high levels of corruption, political instability, and weak institutions—all of which deter foreign investment and hinder economic growth. 

Addressing illegal immigration requires tackling the thorny issue of institutional corruption. Compelling investment, therefore, is putting the cart before the horse. The special economic zones (ZEDEs) in Honduras, recently declared unconstitutional by the Supreme Court and facing appropriation, are just another case of foreign investors drawn into a quagmire

Honduras is also processing a “Tax Justice” bill aimed at raising taxes to expand social programs. In Guatemala, political instability has arisen from tensions between the executive and judiciary over electoral fraud allegations, leading to calls for reforms focused on wealth redistribution rather than economic development.

In contrast, El Salvador has seen some economic success under President Nayib Bukele. His administration has promoted cryptocurrency, pursued foreign investment from China, and secured a new Google center in the country. However, that appears to be related to Bukele’s unconventional administration—which includes strict law enforcement and aggressive business incentives amid an unconstitutional tenure—as opposed to US policy.

Looking Ahead: What Needs to Change

The pending committed investments include: 

  • Acceso, a global social enterprise, has stated it will invest $3.6 million in El Salvador, Guatemala, and Honduras from 2023 to 2028 to improve local food systems for over 10,000 producers. Cuscatlan Bank aims to invest $30 million in financial inclusion initiatives over five years, enabling 600,000 individuals to engage in the formal economy. Steel company Corporación AG plans to invest $150 million in Guatemala to expand production capacity and create over 500 jobs.
  • Ficohsa Bank has committed to increasing its SME loan portfolio by $490 million, prioritizing women-led businesses and investing $50 million in digital services for financial inclusion. JA Worldwide will invest $3.6 million to provide training for over 1,800 vulnerable girls in Central America to promote women’s employment in tech.
  • Meta aims to train 250,000 youth and entrepreneurs by 2025 and support 9,000 women in establishing an online presence. Pearson will provide free access to programs for 3,000 low-income young adult English learners. Pantaleon plans an additional investment of $42 million in the Synergy Industrial Park, focusing on workforce development for women and indigenous communities.
  • Conecta will invest over $260 million in Guatemala’s electrical transmission projects, creating over 3,000 direct and 7,600 indirect jobs and providing electricity access to underserved populations.

While waiting for these offers to materialize, Harris’s involvement in the region has diminished over time. After a highly publicized trip to Guatemala and a visit to the US-Mexico border in 2021, she has not returned to the region. Andrew Selee, president of the Migration Policy Institute, noted: “She had a very narrow mandate, and as far as I can tell, she hasn’t remained as engaged diplomatically.”

The number of illegal immigrants from the Northern Triangle encountered by US Customs and Border Protection (CBP) dropped from 701,049 in 2021 to 495,286 in 2023. This reduction, however, stems from reclassification: new policies that have provided migrants with more formal avenues for applying to enter the United States. These policies include expanding the access and streamlining the scheduling process to request asylum through the CBP One app and establishing physical centers in Latin American countries, such as Mexico. 

De la Vega acknowledges these as improvements but insists they fall short: “What we need is fundamental reforms in the asylum system. There are not enough personnel to conduct thorough interviews upon arrival at the border. Currently, processing occurs in a matter of hours, which limits the information gathered from applicants.” He emphasizes the United States requires more immigration officers and a more robust system for handling asylum applications, which would enable a balance between migrant treatment and US national security.

The limited success of Harris’s initiatives highlights the complexity of addressing illegal immigration. While government-sponsored private-sector investment is an important step, it will not solve the migration crisis. Economic development in the Northern Triangle is hampered by corruption, political instability, and weak institutions, all of which deter meaningful investment and hinder job creation.

As De la Vega pointed out, US immigration policy also needs to start at home and address the immense pull factor. The current system is overwhelmed, with asylum seekers waiting years for their cases to be processed. In the meantime, they continue to live as de facto refugees with virtually no screening. Without significant changes to US immigration law enforcement and the conditions in the Northern Triangle, migration will continue at high levels, regardless of investment efforts or the laws on the books.

Paz Gómez

Paz Gómez is the Econ Americas research director and a widely published economic commentator. Based in Quito, she leads the firm’s office in Ecuador. She holds an MS in digital currency and blockchain from the University of Nicosia, Cyprus, and a BA in international relations and political science from San Francisco University of Quito. She is a cofounder and the academic coordinator of Libre Razón, a classical-liberal think tank in Quito, Ecuador. Follow @mpazgomezm.

More Posts

Join us in our mission to foster positive relations between the United States and Latin America through independent journalism.

As we improve our quality and deepen our coverage, we wish to make the Impunity Observer financially sustainable and reader-oriented. In return, we ask that you show your support in the form of subscriptions.

Non-subscribers can read up to six articles per month. Subscribe here.

Leave a Reply