Latin America, the Caribbean caught in the middle on AI governance

Artificial intelligence governance is set to become a defining issue in the geopolitics of global digital trade. The U.S. and EU, major players in the digital economy, have signaled their respective policy positions for the development, growth and governance of AI — differing notably on balancing AI innovation and development with appropriate governance frameworks and regulatory oversight.

In January 2025, U.S. President Donald Trump rescinded the former Biden administration's executive order on AI safety with the clear aim of deregulating the federal government's use of AI. In early June 2025, the U.S. House of Representatives passed President Donald Trump's spending and tax bill, which included a 10-year moratorium on all state and local laws related to artificial intelligence. The Senate, however, overwhelmingly voted to remove the proposed moratorium. The U.S. does not have any comprehensive federal legislation or regulations on the development of AI, or prohibiting or restricting its use. The result could be a fragmented approach to AI governance with states adopting varying legislative approaches to the regulation of AI.

The U.S. position stands in stark contrast to the EU, which passed the AI Act in August 2024 — widely regarded as pioneering legislation that will ensure ethical, trustworthy and responsible AI development. The European Commission is working with European standardization organizations to draft the necessary AI standards to complement the act's provisions.