With politics shifting back towards the market-friendly right, earnings growth improving and the outlook for commodities becoming structurally bullish given the ongoing arms race for AI, defence and energy, Latin America is again back on investors’ radars.

Since Donald Trump returned to power last year, another dynamic is now in play: a shift in US foreign policy to direct involvement in Latin American affairs. This new paradigm was firmly impressed on the global consciousness after the US economic intervention in Argentina in October 2025, but particularly after action in Venezuela in early January. The move was controversial, and Trump has promised more active involvement in other Latin American countries since. The new US strategy in Latin America has been dubbed ‘the Trump corollary to the Monroe doctrine’, or simply the ‘Donroe Doctrine.’

So far, the combination of a political transition to the centre right with the new US foreign policy has gone well with markets. Latin American stocks (MSCI LATAM) rose 46% last year and momentum has continued to gather in January. The region also boasted the highest total return in the local currency bond market in 2025. Flows into Latin American stocks and bonds are accelerating. In this piece, we explore the historical precedents for the ‘Donroe Doctrine’ and how it may influence investment returns and the shifting political backdrop across the various LatAm markets.