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Lauri: Good afternoon everyone and welcome to Emmett’s webinar today on Iran, Hezbollah and other national security threats from Latin America. Featuring Dr. Emanuele Ottolenghi. I’m happy that you all can join us. We have a lot of information to cover this afternoon. I also want to remind you to save the date for December 5th for Emmett’s annual Raise of Light in the Darkness Gala in Washington DC.

Please save the date, I hope you all can join us and continue your really important support of our important work. Today’s webinar is being recorded, and if you have any questions you can put them in the Q and A function at the bottom of the screen. Dr. Emanuele Ottolenghi is a senior fellow at FDD and an expert at FDD Center on Economic and Financial Power. He focuses on Hezbollah’s, Latin American illicit threat networks and Iran’s history of sanctions evasion.

His research has examined Iran’s Islamic Revolutionary Guard Corps, including its links to the country’s energy sector and procurement networks. His areas of expertise also include the EUs Middle East policymaking, transatlantic relations, the Arab Israeli Conflict, and Israel’s domestic politics. He is author of several books and he blogs at The Hill. His columns have also appeared in leading outlets including the Wall Street Journal of the New York Times, and London’s the Sunday Times, and I urge you all to follow his very important work.

We’re going to just jump right into it now because we have a lot of stuff to cover, and Emanuele I’m going to ask you to start with a sort of broad overview of Latin America and why it presents such a powerful opportunity for our enemies, China, Iran, and Russia, to undermine US global interests and our national security. On a recent FDD podcast discussing Mexico in particular, you shared that in Latin America there are unique circumstances that facilitate a challenging environment for the US, at a time when we’re seen as a declining power.

Can you discuss why Latin America affords our enemies such opportunities to destabilize our country, and perhaps also touch on how fentanyl and the migrant crisis for our open border might be contributing to that.

Emanuele: Lauri, first of all, good afternoon and thank you for hosting me, so it’s a pleasure to be with you and your group. It’s a fantastic opportunity and it’s a great and important topic.

Lauri: Thank you. Thank you.

Emanuele: Latin America is first and foremost, the backyard of the United States, a region that traditionally has fallen under the US sphere of influence, so there is an appeal to our US adversaries to interfere because they’re essentially challenging US power and dominance. Latin America is also despite its significant problems, organized crime as you mentioned, widespread violence, corruption, political polarization, dysfunctional economies and so on.

It is a region of vast riches, natural resources in an age of green transition, rare earth minerals are abundantly available in Latin America, the Chile, Argentina, Bolivia Triangle has the largest known reserves of lithium on earth, which of course could power, would power, will power the electric vehicle industry, among other things. There are great economic benefits in entering the Latin American market and competing with Western and US technology, US know how, and so on.

These are really the two largest, engines behind, our adversaries penetration of Latin America. Of course, we’re talking here about first and foremost China, which is also after food security, so again Latin America is a great exporter of food commodities. Soybeans, grain meat, and so on, so there is that component too for China, Russia as well, and then sort of the smaller authoritarians such as Iran. Now, perhaps there is also one more element to consider, which is all of these countries reject of course the rule-based order that was established on the ashes of World War II, that has come to be dominated by western countries and Western values.

It’s an order that favors open markets, free trade, democratization, transparency, good governance, binding rules on the international community, and none of these powers subscribe to that worldview resent, the fact that this worldview is essentially dominated by democracies want to challenge that, and they have figured out that one way to do that is to promote what they call a multipolar world.

A multipolar world sounds great, more pluralism, more diversity of views, more stakeholders and actors, but in fact what it really means is to diminish the power influence, and guidance of western democracies in favor of authoritarian states on the rise, and of course in Latin America you have countries that toy with self authoritarianism in populism, which also resent the rule-based order and do want to play a bigger role in the world, and so they’re aligning themselves, or at least they’re sort of hedging their betts by letting our adversaries in.

Brazil is 1, Mexico is another, Argentina, but really everybody is sort of looking around and playing that game, and of course at a time when American influence and ability to provide, and also its staying power are being questioned everywhere in the world, it is no surprise that Latin American governments are looking elsewhere for their own developmental interest, and of course we need to ask ourselves, with all the faults and shortcomings that America may have or may have had in the past, is a world dominated or significantly more influenced by China, Russia, and Iran Preferable to the current one.

Lauri: Thank you, so I’m going to jump right into Iran because Iran is mostly what we’re going to focus on, although we will touch on China a bit later. Iran’s President Raisi recently visited Cuba, Venezuela, and Nicaragua in defiance of the US and in violation of sanctions, demonstrating not just how ridiculous our Iran policy of appeasement and empowerment is, but also how inept our Latin American policy is.

It seems like we’re losing the entire region to our enemies, and you’ve touched on why, and you’ve also touched on there is a wave of left-wing populists winning elections who are happy to align themselves with Iran and other enemies of ours. Raisi made it perfectly clear that he was in Latin America to counter the US and harm our interests. Would it be a correct statement to say that the world’s largest state sponsor of terrorism is seeking to take over Latin America, in which it’s exporting, its Islamist ideology and creating terror cells as well as influential cultural centers.

Which presents an existential threat to the US. Do we have a Latin American policy? Candidate Biden said back in 2020, it is the current absence of American leadership in the Western Hemisphere. That is the primary threat to US national security. Russia and China can’t match our extraordinary ties and common history with the people of Latin America and the Caribbean, but since taking office, he’s been MIA, so do we have a Latin America policy to in particular deal with Iran’s presence in the region?

Emanuele: That’s a great question. We do have a policy or a set of policies and they’re not working. Let me give you a couple of examples, or actually refer to a common refrain one hears in conversations with Latin American officials when they’re asked about why they’re letting China, Russia, Iran, or other bad players in, and their answer usually is something like, when the Americans come they give us a lecture. When the Chinese come they give us support or a stadium or a fast train infrastructure project and so on.

One of our problems, and I guess it runs through different administrations, is that we want to export our values, and this administration has been extremely aggressive in promoting a set of values which are at the core of its policies, not just abroad but also domestically, so we’re promoting good governance and transparency, and we have engaged in a robust anti-corruption effort, targeting certain countries in Latin America. We support human rights, and certainly this administration has targeted, egregious human rights violators in Nicaragua for example, through sanctions.

We’re also promoting, boutique cultural issues or cultural wars that speak less to the needs of Latin America, and again, what Latin America needs is development, investment, economic relief, and when they weigh what America offers and the strings that are attached with as against what the authoritarians are offering, oftentimes it chooses the latter over the former. Now, it’s a double-edged sword for Latin America, and one great example is what China is doing in the field of fishing. It may not seem to be such an obvious topic to discuss, in a national security seminar.

The Chinese have been systematically sending giant fleets in Latin American waters, or on the edges of their maritime exclusion zones, and they’re systematically depleting the fish reserves in both on the Atlantic side and the Pacific Ocean side, damaging and potentially compromising irreparably the fishing resources of pretty much every country in the region. The only country that doesn’t have a seashore in Latin America is Bolivia.

Everybody else does, and everybody else is worried that the Chinese are essentially practicing a sort of mercantile colonialism in their backyard, so there is a double-edged sword, and that’s why the countries are not throwing themselves in the arms of our enemies, but they’re hedging and they’re essentially signaling America that, we need to do better. Now, when it comes to Iran, I don’t think that their ambition is realistic, because they’re not the same powerful country that say China is.

I think you described their long-term plan correctly. They believe that they can expand slowly, gradually, and strategically expand their influence in Latin America. Sometimes they piggyback on China and Russia, but mostly they see a potential in the ideological sphere to emphasize common worldviews with the authoritarians in the region. Where countries are still democratic, they certainly develop strong alliances with like-minded movements.

As you mentioned the cultural centers, they also use soft power to expand their base and influence within society, reaching out to influencers, penetrating academia, and all the other spheres of influence which may not have an immediate impact, but long-term can guarantee, and have a wider set of support. Their narrative is calibrated to have maximum impact on their different audiences across the region, so what they’re selling is not hardcore revolutionary version of Islam.

What they’re selling is a revolutionary ideology that is infused with an Islamic component, but essentially they’re saying to their Latin American counterpart, our Hussein, the great symbol of Shia resistance, which the Iranian revolution has manipulated and turn into a banner for communism[?] is essentially an Islamic [inaudible]. You mentioned Raisi’s visit to Caracas, I just wanted to give you a very telling example. Among the various things he did in Caracas, he went to give a lecture at a local prominent university in Venezuela.

Met the students, and there are photographs out there, on social media of his, attendance, and the students are sort of lifting up photographs and banners prepared for the event with the flags of Venezuela and Iran, talking about resistance against imperialism, against oppression and so on, and the icons on those photos are Ugo Chavez, not a surprise, Simon Bolivar, the great symbol of the Bolivarian Revolution in Latin America.

Also not a surprise, an icon manipulated by the Bolivarian regime, but the other 3 people there are quite remarkable. 1 is Qasem Soleimani, another one is Khomeini, and the third one is Julian Assange, the WikiLeaks founder. Why is Julian Assange there? He’s not Islamic, he’s not part of the Venezuelan iconographic revolutionary pantheon, and neither is he part of the Iranian one, but he is a symbol of resistance against America.

They’re able to calibrate their message to reach beyond those audiences that might be attracted to the Iranian version of revolutionary Islam, and they’re very successful. They’ve been playing the long game for a long time. They started this project in the early 1980s. 40 years later, they’re going strong and they’re convinced that at this time of American power eclipse, with a lot of countries in Latin America, no longer looking at Iran as an equal, but potentially as a sort of a hegemon. They now see a great opening, and that’s why they’re pushing so hard.

Lauri: Well, you brought up Caracas and Venezuela and Iran have a very close alliance it seems, and they signed a 20 year bilateral cooperation agreement. I believe it was last year, but, it’s designed to evade US sanctions. How is that working out? And the State Department has issued statements of concern that Maduro is granting safe harbor to terrorist groups, including Hezbollah, and it just doesn’t seem like we’re doing anything to address that cooperation, and the growing presence of these terrorist regimes down there as well.

Emanuele: That a great point, and I think the 20 year cooperation agreement that is being implemented, through subsequent agreements. Part of the purpose of the visit by Raisi was to seal a number of important bilateral agreements is very revealing of 2 things. 1, exactly the fact that these 2 countries feel, they have found a way to essentially, contain the damaging impact of US policies, but I think the second point may be even more important.

I mentioned before that Latin American countries that looked to Iran as an ally looked to Iran as an equal in the past. That was certainly the case with Venezuela. When the Iran Venezuela relationship sort of blossomed in the early 2000, when Chavez was president in Venezuela, and Ahmadinejad was president in Iran, they were essentially equals. Venezuela’s economy had an collapsed yet, Venezuela was not under the kind of US sanction regimes it finds itself today, and Iran looked to Venezuela, essentially as a lifeline to help Iran evade sanctions.

That’s why Iran established banking institutions in Venezuela. That’s why Iran established joint industrial and commercial ventures in Venezuela. Venezuela certainly benefited from Iran’s know how. Iran came to build housing units in Venezuela with some of its largest companies, but it was 2 equals. You are helping me on something, and I’m helping you on something in exchange. Today, it is a relationship of dependency where Iran is the giver, Venezuela depends on Iran to run its economy.

Iran intervened to essentially provide gasoline to Venezuela. 10, 12 years ago, we America devised a set of sanctions against Iran to target its refining sector, because Iran was not producing enough gasoline to supply its own needs, and that hurt a lot.
Well, today Iran not only supplies its own needs, but it is actually exporting gasoline to Venezuela to keep cars running in the country, because Venezuela’s refining output is insufficient because of the degrading of its industry under sanctions.

That’s a great example, and so Iran comes now and banks on the fact that Venezuela and other countries are needing Iran so much more than Iran needs them, and that gives them a lot more leverage and an opening. I’ll give you one example that to me is very revealing, even though perhaps it’s not monetarily speaking the biggest of the agreements signed, but one of the bilateral agreements reached in Caracas last June, essentially, gives Venezuela the opportunity to send a hundred and fifty students a year to Iran with a full scholarship to study at Iran Scientific universities.

Now, it used to be the case that the great and the good of of Latin American university elite, if they wanted to get their masters and PhDs, they would want to come to the United States, and now we are in a situation where Iran is essentially allowing them to educate their technocrats in Iran, so this is a great opportunity for Iran to expand its propaganda, to win over a hundred and fifty senior or future senior leaders of the oil industry and the engineering sector, and the construction sector and what have you, to their own cause.

Because they will spend years there. They will study, they will make friendships. They may meet their future spouses, they will be imbued with ideology. Well, they will be grateful to Iran, they will come back and deliver, so this is a significant game changer I think when we look at this agreement and the framework it provides, and the opportunity gives Iran to expand, and of course one of the things that Iran is exacting, as you pointed out, is access.

Not only our Hezbollah networks thriving in Venezuela, and not only is Iran helping Venezuela made sanctions and in the process enriching itself, Venezuela as you know is paying Iran in gold, illicitly and criminally extracted in environmentally very, very delicate areas of Venezuela. Want to talk about a concern that this administration has with climate change and environmental degradation. They should look at Venezuela and what is happening there, so there’s great, great benefit, from that, but Iran is also as you said using Venezuela as a gateway for its soft power work in Latin America.

It is using Venezuela resources to broadcast its propaganda through Hispan TV. It’s Spanish language television all across the continent, and last but not least, it’s using Venezuela to expand its academic footprint in the region, not just by that agreement I mentioned, but Iran in the last 3 years has established an academic center in Caracas. It’s called Calibre[?] Qasem Soleimani, named after the Iranian general, and it’s using it to establish cooperation with local universities.

Not just in Venezuela, to organize and host seminars across the region to establish cooperation with other centers, and thereby expand the ability of Iran’s recruitment beyond the religious fear. Now they’re going into universities. Students may not be attracted to Islamic religious life, which is part of the conversion process Iran promotes, but they may be attracted to the revolutionary zeal and the grievances that fuels, and so this is another great opportunity that did not exist before, and thanks to this lopsided relationship, Iranians now have.

Lauri: Fascinating, but also very frightening, the extent of their influence as it’s growing, so I want to ask, what does it say that Brazil’s President Lula allowed Iranian warships to dock in ports in Rio de Janeiro earlier this year? And he did so just after returning from a trip to DC to meet with Biden, and just after the US threatened sanctions, which Lula just simply ignored, so how dangerous is this to the US national security and our economic and trade interests? And I just want to add that around the same time as that Iran threatened to station warships in the Panama Canal.

Do you believe that that will occur? I’m wondering that was I think back in January that threat was made, I’m wondering if Biden’s secret nuclear deal and payment of $6 billion in ransom maybe helped delay that event from happening, but do you think that’s going to occur, and what would be the implication of such an escalation? Because presumably the US can’t just sit back quietly and allow that to happen.

Emanuele: It’s a great question. I think that the US used quiet diplomacy and pressure to make sure that those ships docked in Brazil, eventually couldn’t make it up to the Panama Canal, they had to go the opposite route to complete their circumnavigation of the world, but the fact remains that they did dock in Rio. They stayed there for a week. They were invited by Brazilian authorities and received a very warm welcome at the time, and what matters most about this visit is not the visit itself but the president, that now you have an opening for more exchanges and more visits.

The taboo has been broken, and again, Brazil with Lula playing this multilateral game, but we have to remember Brazil already was somewhat playing this game with Bolsonaro. Bolsonaro did not shy away from maintaining cordial relationship with Russia, even as Russia invaded Ukraine, because Brazil’s agricultural sector is heavily dependent on fertilizers, and Russia is one of the world’s largest exporters of that product, by the way Iran too.

No now that Lula is in power, and he also has his sort of ideological baggage that lowers the bar of this kind of attitude, Lula is using the opportunity, boosting the bricks to expand it to perhaps a copycat of the non-line movement, negotiating deals with countries in what they call the global South to trade in national currencies, essentially trying to de dollarize the global economy or to push back against the dollar dominance in the global economy.

Which means not having to follow certain rules in financial transactions, and in the financial markets and so Iran is just another one of the players that Lula wants to have cordial relationships with, and essentially the signal is we are going to ignore US suctions and US pressure, and by showing that he could get away with it, not only did he do it just after a visit to the White House, but he has met President Biden again just recently signing bilateral agreements on the promotion of workers right internationally.

He essentially is telling his audience in Brazil and the world, America can no longer tell us what to do in the fields of foreign policy even when it comes to its adversaries, and that’s very worse.

Lauri: Yeah, it takes me back to me saying what is our Latin America policy, because it doesn’t really seem like we have one, so I want to turn to Hezbollah because in addition to being a terrorist organization, in effect a transnational crime syndicate, and it’s presence in Latin America is pretty pervasive, so it seems like Hezbollah has set up shop in a number of countries, and we’re not doing anything to address its illicit activities. We know that it’s responsible for the 1994 bombing of the Jewish Cultural Center in Buena Grace.

Killing Jews, may be a benefit for its presence in Argentina at that time, but it’s criminal enterprises, it seems to me to be why it’s there, and it’s conducting drug trafficking and money laundering. I’ve also read that Hezbollah works closely with the Latin American criminal organizations including the Medellin cartel and other cartels in Brazil, Mexico, so can you discuss Hezbollah’s presence in Latin America, and how pervasive it is and what it means?

Emanuele: Absolutely, and I’m glad you brought this up. It’s kind of the unconventional weapon of Iran, of course, as we know, it’s a proxy, and Iran has bankrolled Hezbollah since its inception over the decades, but as Hezbollah’s operational budget influence both domestically in Lebanon and in the region have grown over the years, its financial needs have grown too, and one way Hezbollah integrates the financial support it receives from Iran to meet its needs, is by conducting engaging in illicit activities.

Some of these illicit activities Hezbollah conducts on its own, and some cases it just provides services to criminal syndicates. Now, from the history of terrorism, we know that most terror organizations have financed themselves over time through a mixture of means that always included also a criminal component. You can go back to Stalin robbing the bank in Tbilisi, the National Bank of Georgia in 1907 to finance the communist Party activities in the caucuses.

Or the great brigades in Italy in the 1970s, or the PLO itself, or the IRA they or the Taliban or the Islamic state more recently.
They’ve all used crime and engaged in criminal activities and therefore interacted with the criminal underworld to finance themselves. Now, what makes, Hezbollah stand out I guess, is that they perfected this art and also that their business affairs component as US government officials refer to it, is integral to the external security organization of Hezbollah, namely that branch of Hezbollah that is responsible for terrorism.

Make no mistake, Hezbollah’s illicit finance networks are there primarily to raise funds through illicit activities, but they’re also there as a permanent logistical infrastructure that Hezbollah can leverage and activate to carry out their attacks. You mentioned the army of bombing, which by the way killed a lot of non-Jews as well. We should always remember, this was an attack on Argentina not just Jews, and as it’s known by now, the logistical infrastructure of that attack was not in Lebanon or in Iran.

It was primarily in the tri borderer area of Argentina, Brazil, Paraguay relying on Hezbollah agents and sympathetic community members of the local Lebanese Shia expiratory community, which has mainly arrived there in the early 1980s, so during the last years of the Lebanese Civil War, when Hezbollah was already in existence, and Hezbollah of course infiltrated or established in some cases the religious cultural, educational, social institutions of that community and others around the world, to ensure continuing loyalty by the members.

Hezbollah has this incredible infrastructure, and just to bring it to the present, 2 weeks ago or ten days ago treasury sanctioned, 3 Colombian Lebanese nationals and the Lebanese in Lebanon, for running a sophisticated extensive commercial operation that was funding by 80% of its revenue. Funding Hezbollah, and one of the key figures in this network, who unfortunately has already escaped to Lebanon several years ago, was actually one of the operational members of the AMIA cell, so here we have a perfect example of somebody who in his youth is already active in Latin America, and becomes instrumental in carrying out the deadliest terror attack in the Western Hemisphere before 9/11.

Then fast forward 34 years later, 30 years later, he has become a businessman in Columbia with his brother who’s now a businessman in Venezuela, and one of their sisters actually I am told having a US citizenship, and they’re able not just to provide support to Hezbollah for terror attacks, but also raise funds. Now, 1 last point you mentioned the fact that they inter interact and inter face with criminal syndicate, and this is very important because we’re talking about multimillion and multi-billion dollar industries here.

The cocaine industry, the drug industry is one of the key factors in providing Hezbollah’s revenue in Latin America. In other parts of the world they do other things, but in Latin America it’s mainly drugs, and what are they essentially offering the cartels? 3 things. 1, they’re facilitating logistics, they’re not the ones owning the cargo, but they facilitate delivery of the merchandise, and if necessary distribution. 2, they launder the money back so they provide financial services.

Three, sometimes they move from just being mere distributors to actually buying the merchandise, and turning it into their own direct source of funding. We have cases of all of these 3 models, and so that provides a revenue which has been conservatively asked conservatively been estimated to be at least 30% of Hezbollah’s budget, so it’s very significant, and it has dramatic side effects and impact, not just in the Middle East, because they’re funding terrorism in the region, but also in Latin American in the Western Hemisphere, because to sustain these activities, they of course facilitate the violence associated with organized crime there.

They facilitate the corruption that is associated with organized crime there, the environmental degradation and a whole host of other side effects which are not just a national security threat to us here in the United States, or to our allies in the Middle East, but they’re a terrible domestic threat for the countries in the region, and that’s why those countries should step up, and take this threat more seriously.

Lauri: You mentioned a few minutes ago the sanctions, and you wrote an article that you called Treasury Sanctions has Hezbollah’s Network in Columbia, but what took so long, and in that column you wrote, the Biden administration wants to create the impression it is finally getting tough on Hezbollah, the Lebanese Terror Group and Iranian proxy, the Treasury Department sanctions last week against 3 Colombian based Hezbollah operatives, and their businesses seem to suggest the White House is taking the threat more seriously.

In fact, this latest action is a classic case of closing the stables after the horse has bolted. Can you just elaborate on that a little bit?

Emanuele: Yes, absolutely, and thank you for mentioning my article. Look, the facts are these. Treasury sanctioned a network it named 3 Lebanese nationals operating out of Columbia and Venezuela, and 1 in Lebanon and then it mentioned several companies. The problem with the designation is that on the one hand, it’s great, they’ve been exposed, one of them of course, had also the AMIA connection that’s finally been exposed authoritatively by US authorities.

All of that is very important, but the fact of the matter is, is that the individual implicated in the AMIA bombing and in the business network left Columbia already in 2014, and the other 2 individuals based out of Columbia, 1 his brother and 1 his nephew, left Columbia for Venezuela, probably a around 2 years ago, and why is that? Because as early as 2018, their implication in Hezbollah’s traffics was exposed publicly by articles in the Spanish language press, notably by info buy.

Which is the biggest news platform in Spanish and Latin America, and then in 2020, October, 2020, one of my colleagues, friends who sort of operate in this research space, Joseph Meyer, a great scholar of Iran in Venezuela, and really all things like America, wrote an extensive report published by the Atlantic Council, where he detailed this network and in their involvement in the list activities in a way that is eerily reminiscent with the wording of treasury’s designation.

If that was not enough, a year or so later in March of 2022, another author published an even more detailed report of the network, through the Washington Institute, which is a very serious and well-respected platform, so that information was already out in the public domain, and it gave the time to these people to wrap up their businesses, shut down the companies that were sanctioned 2 weeks ago, create new businesses, and more importantly leave Colombia.

By the time the sanctions arrived and the Colombian officials in charge started looking for these people and had sort of a mandate to investigate, they’re gone, so we got a press release but they got ample time to withdraw and regroup, and that’s why it’s not a very effective policy. Now, the reasons for this delay, if it is indeed a delay may be benign. There may be a problem at OFAC, they’re overworked with Russia and China and Fentanyl and other issues.

We all want treasury to be super fast, but it’s a small shop, and we can’t complain about taxes increasing and budgets, ballooning and the debt being out of control, and then ask for more public resources to be thrown at our government, so that might be that, but clearly the effect has been underwhelming.

Lauri: You brought up China in the context of your response to my first question to you, so I want to now let’s talk about China a little bit more extensively. A number of issues have raised serious concerns about China in the region, including the fact that many Latin American countries are severing ties with Taiwan in order to establish ties with China, including the Dominican Republic, El Salvador, Panama, and most recently Honduras.

The motivations for doing so may be economic as China takes its spot and road initiative to the Western Hemisphere, but the result from a US national security standpoint is obviously not positive, and then another troubling development was when we learned this summer that China had set up a spy base in Cuba back in 2019. China’s also going to be paying Cuba billions for a new military facility for electronic use dropping.

A senior military commander testified before the House Armed Services Committee earlier this month, about the various threats that China poses in the region and stated “in any potential global conflict, the PRC could leverage strategic regional ports to restrict US Naval and commercial ship access. This is a strategic risk that we cannot accept or ignore”. Can you share with us how extensive China’s presence is in Latin America because I know that it too works directly with Mexican and other criminal networks and drug cartels, so how concerned should we be about this and is the Biden administration addressing it?

Emanuele: Great question and it probably would take another whole seminar to dissect everything that China is doing, but sort of big picture China is of course I mentioned food security. That is a very big issue perhaps bigger than we think that drives them, and that is pushing them to invest in buying agricultural commodities, but also secure access through buying companies and buying lands, which is of concern because I can tell you that if you’re concerned about deforestation and climate change and so on, who would you prefer to be involved in the agrifood sector, China or the United States?

I can assure you that China will be a lot less concerned about the environmental impact on this thing, so that’s one big thing that drives them. The second of course is to essentially create a mercantile colonial relationship with the countries in the region, through the establishment of large infrastructure project that are financed through loans, which these countries then cannot repay, so it creates a kind of a dependency on China, which gives China future leverage, in the geo strategic space.

Those are 2 pretty big and obvious things that China is doing. I mentioned the fishery, so the depletion of national resource, China is after rare earth and the triangle of Chile, Bolivia, the Bolivians have just sort of a Russian company and a Chinese company to develop their lithium resources, so that’s another thing. They’re beating us in the competition for resources, and you mentioned intelligence. Of course, all of these things give China the opportunity to penetrate the region to establish a much broader presence.

Cuba of course is something that is out in the open and it’s been discussed, and it’s worrisome because it’s right next door, but China Station in Cuba is not the only one they have in Latin America. They created a presence in Argentina not far from the Andes, so the border with Chile, by creating what is essentially a Chinese extraterritorial base. It’s officially an aerospace station to monitor their space program, but the Argentinians gave up access to that territory.

The base is not accessible to Argentinian authorities. Only Chinese go in and out. Nobody knows what’s happening in there, and so that is another building block of what China is doing. Of course, you mentioned Taiwan. They have also essentially pushed Taiwan out of Latin America, only Paraguay remains as a staunch ally of Taiwan, and it’s not always an ideological choice for Latin American countries. I suspect that in Xiomara Castro of Honduras, it was more of an ideological choice than a commercial one, or it was a mixture of both, but in Panama’s case was definitely not the embrace of mercantile communism.

It’s really business and Taiwan is a great cause, but if you measure their small population against the Chinese markets, especially for agriculture exporting countries like Brazil, Uruguay, Argentina, China is a lot more appealing. They have a much easier game, and I think that we need to think about what this entails for the long term consequences because the Chinese, when they bring their investment in business, they bring strings attached and their strings attached are a lot more suffocating than the ones America brings..

Just to give you an example, we bring along the Foreign Corruption Practices Act, which is essentially a piece of legislation that tells their businesses entering business ventures abroad. Thou shall not be corrupt, which means you won’t take briberies and you won’t buy access with briberies. The Chinese bring their spying apparatus and sort of dystopian or William State with their strings attached. They for example have been offering contracts and aid to train security forces or to provide security equipment, and the result is that you have CCTV cameras all over Latin America now provided by the Chinese.

Which are essentially relaying intelligence back to the Chinese, so this is the kind of faustian bargain that the Chinese offer, and because we are not there to countenance this influence given the needs of countries in the region, those countries are buying.

Lauri: Thank you. I just want to follow up with a question about Iran and China and whether they’re aligned in their quest for influence in the region, whether there’s the military presence that we talked about, the economic interests and both have the same goal of downgrading US policy. Power and influence in our own hemisphere, and globally I would add, and they’re both working with the drug cartels, so are they working together or is it more in tandem?

Emanuele: I think it’s more in tandem. Iran cannot match China’s economic power, or military or technology, but it’s not an insignificant player on the global sea, they are acting in tandem because as you correctly said, they both share the goal of diminishing American influence in the world. I think the Chinese may not be as sanguine as the Iranians in seeing America as the great Satan, that may be another difference, but bottom line is that they want to change the global rules of the game, but it will be interesting to see as things move along.

Whether they will enter into areas of competition, we haven’t seen that yet. We haven’t seen China, Russia, Iran, as areas of competition, of course is in the cultural soft power sphere where, you see competition against Iran from the other sort of Muslim powers such as Turkey and Qatar and Saudi Arabia, who have had their own operations trying to establish their religious centers and cultural centers, but they’re not sort of promoting the same kind of revolutionary ideology that Iran is doing.

Very much less political in their endeavor. One area where you do see cooperation by the way, not necessarily with China but with Russia and Venezuela of course, is in the media war, and there you see an alignment, of content and news content and disinformation between the various channels representing the authoritarians in the region, so you will see themes and stories in…

Lauri: Emanuele.

Emanuele: Venezuelan Bolivarian broadcasting station in [inaudible], which is essentially Hezbollah on the platform of the Chinese Spanish language TV. Can you hear me?

Lauri: Yeah. I’m not sure if it was me or if it was you, you were going out for a second but yes.

Emanuele: I apologize, so all I was saying is that you do see a convergence in messaging in the disinformation sphere of all the media platforms affiliated with the authoritarian players in the region, and sometimes they even share journalists and correspondents and studios, so there you do see cooperation.

Lauri: Someone asked about Hezbollah’s criminal activities, and if there’s evidence that they collaborate with Mexican drug cartels. Are they also connected to China, which is the source of the fentanyl precursors.

Emanuele: They are connected to criminal cartels worldwide, and the principle service they offer is money laundering, so they are essentially moving money back from the seller’s markets into the pockets of the criminal organizations that provide the goods. Now, I have not seen yet evidence of a direct connection between these networks that launder money for crime, and the criminal networks that bring fentanyl through Mexico into the United States, but given that Hezbollah has developed this money laundering infrastructure in the Western hemisphere, and elsewhere in the globe for decades now, I wouldn’t be surprised if that connection eventually would emerge.

Lauri: Someone asked about our open border since we don’t really know who is coming across, and I was actually going to ask you about that as well. We know that as of July there were a hundred and sixty migrants on the terrorist watch list who have been stopped so far this year trying to enter the US from Mexico, but what we don’t know is how many terrorists are in the one point five million got aways who have entered the country since Biden took office, and we know that Venezuela is taking people out of prison and sending them up north into our country.

People are coming from the Middle East, Asia, Africa, so what do you think in terms of who is coming across, how concerned should we be about a future domestic terrorist attack is. In my view I feel like it’s almost inevitable, but I’m hoping that I’m obviously wrong about that, so can you share about what you think might be coming across in terms of we know the fentanyl, we know the bad stuff’s coming in, but who’s coming in?

Emanuele: It’s an interesting question because you’re absolutely right, the numbers show that… and by the way we know that from the experience in Europe during the Syrian Civil War, that alongside the millions of people who are escaping the horrors of the butcher of Asad, the Iran, Hezbollah and Russia, there were jihadist infiltrating the stream of refugees going into Turkey and then onto Europe, so it behooves these people to exploit these kind of phenomena to their own advantage.

The one thing that at the same time leaves me skeptical that at least in the case of Hezbollah, they will try to use the desert rat line of the clandestine immigration stream, is that in the past, in the recent past, every single Hezbollah agent that came into America that was eventually exposed by the authorities. Came through the front door. They came in legally, they came in as students with, student visas, and then they somehow managed to stay. They got a job, they married and they became US citizens in the fullness of time, and that’s when Hezbollah activated.

We already have about 4 cases between 2017 and today of such agents, and we see a pattern. They come in, they apply for green card citizenship. Once they have a passport, Hezbollah activates, and so that’s one consideration, and again I think that to choose to send agents into America for the purpose of carrying out terror attacks through the caravans of immigrants that moved from Brazil and Colombia into the Darien gap, through cartel territory, through the desert, all the way to the Rio Grande is risky, because we know what happens to a lot of these people on the way.

Nature is cruel, cartels are cruel, and so I would say that if you’re a terrorist organization and you want to send agents to attack America, your preference should be through the front door, if you choose that access point, it’s because you no longer have access through the front door, and that means that at least on that side, our immigration authorities and our counter-terrorism authorities, and our intelligence authorities are doing a good job. Now, that doesn’t solve the problem of the border obviously, and how it can be exploited, but that’s for another seminar I think.

Lauri: Yeah, someone asked, and this will be our last question because it’s almost 1, but is there a role for US criminal investigation organizations like the DEA?

Emanuele: Absolutely. There was a great role for DEA. DEA actually was the one who really kind of zeroed in on the crime terror convergence of Hezbollah almost 2 decades ago, and launched a series of sweeping investigations that over a decade still remain the main provider of open source information and understanding of the extent, intricacy and sophistication of Hezbollah’s criminal and money laundering networks, so absolutely, but of course DEA has fairly narrow remic.

It focuses on drugs and corruption and money laundering, and what we have seen in recent years, even as some of the investigations were shut down for political reasons, or let fall by the wayside, or put on ice or move to different agencies, we see less and less mention of Hezbollah in criminal investigations, even when we know or suspect that the networks targeted are benefiting Hezbollah, and that may have to do with politics. It may have to do with evidentiary burdens, but we’re kind of losing sight of how extensive and important to Hezbollah funding these networks are.

We need more understanding and more exposure of this, and yes, the law enforcement agencies have a role to play because it is not enough to publicly name these people and companies, and networks to sanction them as the example we talked about earlier shows by the time we sanctions them they may be in the wind, or they may be in countries that will not take action against them. Criminal investigations have been a lot more effective. They brought people to justice. They have disrupted networks, they have embarrassed facilitators.

They have led to sanctioning facilitators outside the Hezbollah networks such as politicians, corrupt politicians and judges, so the impact of these criminal investigations if carried out to the full extent of the law and with enough resources, would be a lot more devastating, and why? Because at the end of the day, even though America is the great Satan, Hezbollah’s illicit financial networks heavily rely on US jurisdictions to move money around.

One of the reasons is that a lot of the money generated by illicit drug sales, of course comes from America. We are a consumer country, but it’s also because there is an important diaspora here, and they leverage it here, like they are leveraged it elsewhere, and because dollarizing their money movements has benefits, so we have leverage on them too, and we should use it.

Lauri: On that note Emanuele, thank you so much for joining us this afternoon. I knew we would learn a lot from you, and I so appreciate you sharing your insights with our audience today, and I thank everybody for joining. Please follow Emanuele’s important work. He’s covering very important national security issues that we should all be focused on.

Emanuele: Thank you so much.

Lauri: That can be found, and I wish everybody a good afternoon. Thank you.

Emanuele: Thank you.

Lauri: Bye-bye.

Emanuele: Bye.


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