The Saudi Fund for Development has launched high-level talks with Guatemala on infrastructure, agriculture, solar energy, and water management. This initiative reflects a Saudi effort to expand its influence in America’s backyard, where Beijing is also ramping up its diplomatic and economic engagement ahead of Guatemala’s 2027 elections. Washington should take a cue from the Saudis and seize this opportunity to increase America’s appeal as an economic partner and security guardian in the region.
Despite the absence of a Chinese embassy in Guatemala City, Beijing has increased its economic and political engagement in the Central American nation.
Guatemala is the Republic of China’s oldest continuing ally, with relations established in 1933, before Mao Zedong overthrew the Republic and it re-established itself on Taiwan. Despite the absence of a Chinese embassy in Guatemala City, Beijing has increased its economic and political engagement in the Central American nation. Between 2019 and 2025, China’s exports to Guatemala grew 200 percent, reaching $5 billion. Beijing’s infrastructure investments in the country always come with strings attached, while its agents operate throughout Guatemala’s political and elite circles. A shift in diplomatic recognition would give China a significant propaganda win.
Guatemala needs $48 billion in infrastructure investments through 2030. The country’s agricultural sector accounts for almost 14 percent of its gross domestic product and employs 31 percent of the workforce, but inadequate road infrastructure and a lack of deep-water ports hamper growth. The U.S. Customs and Border Protection regularly ranks Guatemala among the largest contributors to crossings along the U.S.-Mexico border. Studies show that sustained economic growth and an annual increase in local employment of just 7–10 percent could significantly reduce illegal crossing attempts over time.
The Saudi Fund for Development has 21 Latin American and Caribbean projects worth a combined $951 million. Riyadh’s desire to reduce its economic dependence on China and hedge against possible geopolitical isolation drives the Fund’s interest in the region. The Saudis’ expertise in solar energy, water management, and arid-land farming could help modernize Guatemala’s agriculture, generating vital income and employment opportunities in rural areas. Modernization of transportation and telecommunications infrastructure also would facilitate the export of local produce, helping offset eventual migration pressures toward the United States and generating income for local farmers and businesses.
Strategically, Saudi Arabia’s Vision 2030 aims to expand Riyadh’s influence beyond the Middle East and invest in strategic partnerships. While Saudi Arabia frequently competes with Beijing and Moscow for influence in third-world countries, Riyadh’s interests align with Washington’s in confronting Iran and preventing the regionalization of great-power strategic competition. A prosperous and secure Guatemala that resists the advances of both Tehran and untrustworthy elements remaining in Caracas will serve U.S. security interests. At the same time, America’s previous attempts to manage irregular migration at the point of origin have been ineffective, with traditional approaches such as economic assistance yielding few tangible results.
To maximize the benefits of this emerging economic partnership, Washington should pursue four policy options that would build on America’s strengths and increase its strategic gains.
First, Washington should seek to develop a tripartite infrastructure and technology corridor financed by American, Saudi, and Guatemalan investors. Washington’s presence and leadership would ensure that critical infrastructure projects meet stringent security and transparency requirements and provide physical protection for U.S. assets. Riyadh’s participation would facilitate the “nearshoring” of American investments and the relocation of supply chains away from China. In parallel, artificial intelligence-powered U.S. oversight and monitoring would ensure value for money and help build an auditable database of jobs the corridor creates and migration rates it reduces. This measure also would serve as a model for engaging in strategic partnerships to bolster economic security, technological preeminence, and national security amid great-power competition.
Second, Washington should seek to establish joint American-Saudi technical centers in Guatemala to help train its farmers in agribusinesses, food production, and solar power. The centers also would provide a venue for indirect but substantive Israeli-Saudi exchanges on related issues and serve as a confidence-building measure to help advance the Abraham Accords, while also addressing cyber and supply-chain security. By linking major infrastructure projects to workforce development, Washington can help build a sustainable middle class, strengthen Guatemala’s economic resilience, reduce on-site incentives for illegal immigration, and provide these industries with skilled workers.
Enhanced U.S.-Saudi security cooperation ... could lay the groundwork for a trilateral security forum on investment protection and the counter-hybrid threat.
Third, Washington should enhance the role of infrastructure and technical capabilities as part of a broader strategy to bolster regional food security and supply chains. Modernization of the agricultural sector and its critical infrastructure components has the potential to make Guatemala a regional center for food processing and specialty farming. The U.S. should promote free trade and “nearshoring” opportunities for Guatemala’s specialty agricultural producers, including vegetable, fruit, and meat-processing companies. This would help diversify America’s food imports and shield them from political interference.
Fourth, Washington should encourage the Saudis to impose conditionality on their investment to tie its economic engagement to policy shifts that demonstrate Guatemala’s commitment to the rule of law, regional security, and Taiwan’s interests. Enhanced U.S.-Saudi security cooperation, such as providing the Saudis with threat assessments in Guatemala, could lay the groundwork for a trilateral security forum on investment protection and the counter-hybrid threat. This would enable Washington and Riyadh to jointly confront China’s interference in the region without endangering America’s national security interests.
