The recent freeze of U.S. foreign aid under U.S. President Donald Trump, including cuts to programs funded by the U.S. Agency for International Development and the U.S. Department of State, marks a critical turning point for Latin America and the Caribbean, given the region's ongoing socioeconomic challenges. As the U.S. reduces its contributions, the European Union faces an unprecedented opportunity to step up as a key global player in Latin America and the Caribbean and deepen its engagement in the region.
The region grapples with significant structural challenges. Limited access to affordable financing, high inequality, slow economic growth, and widespread violence shape the region’s complex socioeconomic landscape.
These difficulties are especially pronounced for young people, who face increasing job market insecurity. Recent research by the Economic Commission for Latin America and the Caribbean and Ayuda en Acción estimates that more than 1.8 million young people will transition into the service sector in the coming years — posing evident challenges for education and social welfare systems.