Progress vs. stalemate

Amid flooding, rainstorms, evacuations, and power outages, Uruguayans elected another moderate leftist leader to rule their country for the next five years. After Jose Mujica failed to win enough votes in the first round of voting in October, he earned just over 50% of the vote in Sunday’s runoff. He ran on a platform of continuity; praising the current leftist governments’ economic policies and vowing to model his presidency on Brazil’s highly popular president, Lula da Silva. He appears to be dedicated towards engaging neighbors in dialogue, evidenced by the meeting planned with Argentinian President Fernandez next week (when he will tackle the highly divisive Botnia pulp mill topic).

Such sensibility and stability stands in contrast to Honduras where the coup and subsequents events further polarized the continent. In the lead-up to Sunday’s elections, Colombia and Peru announced that they will recognize the results while Brazil, Argentina, Paraguay, Venezuela, and many others maintained that they will not. Not even another international summit, the Ibero-American summit held in Portugal, led to an agreement despite the attempts of Spanish Prime Minister Zapatero.

While it remains unclear how the Honduran storyline will end, Uruguay is demonstrating itself to be a solid example of a leftist government with sound fiscal policy and social politics. Although Hugo Chavez declared Mujica’s victory to be another example of the type of change he expounds and envisions for the continent, the former guerrilla leader appears to be leaning towards moderation and sensibility. If only the wind would blow that same sentiment elsewhere.

Putting off the inevitable

In August, member nations of UNASUR failed to reach an agreement over Colombia’s decision to allow the United States access to seven of its military bases. They held two subsequent meetings but again failed to draw up an agreement. Now, after months of Chavez warning that Venezuela needs to protect itself from a future invasion by Colombia and the United States, Venezuela has announced that the only body they will allow to negotiate is UNASUR. A meeting is planned for Friday in Quito.

Such a task promises to be extremely difficult. In addition to the $4 million of Russian arms Venezuela has acquired since 2005, the government is currently awaiting 300 Russian armored vehicles and tanks. Their next order from Russia will include surface-to-air missiles. However, Brazil and Ecuador have also been selling arms to Chavez’s regime. Coincidentally, Ecuador’s president and member of Chavez’ ALBA alliance, Rafael Correa, is the current UNASUR president.

It is clear that many South American countries object to the American access to Colombian bases. An agreement of some type seems necessary. It is, however, difficult to envision UNASUR playing a significant role in any negotiations since Colombian President Álvaro Uribe didn’t even attend the August summit due to poor relations with Correa. Unfortunately, negotiations are really what the continent needs. UNASUR would do well to diffuse tension so that Venezuela’s government can focus on the problems its people face on a daily basis; blackouts, food shortages, rampant crime, and 26% inflation. Worrying about a possible US/Colombian invasion is likely not the best use of anyone’s time outside of military and intelligence circles.

Spy games

This year, Latin America has witnessed one crisis after another, whether economic, diplomatic, military, or commercial in nature. The results are nevertheless the same – a ratcheting up of public sentiment as politicians play up nationalist themes. The latest incident comes from Peru, where two members of the country’s air force (including Air Force technician Víctor Ariza Mendoza) are being charged with espionage. They, and two members of Chile’s armed forces, are accused of selling state secrets to Chile.

Chilean leaders have strongly denied the claims. They report that they are a serious nation that values solid diplomatic and commercial relations with its neighbors. They accuse Peru of strategically releasing the arrest information as a distraction during last week’s APEC meeting (Asia-Pacific Economic Cooperation), nearly two weeks after Ariza Mendoza was arrested. Yet Peru is not backing down. President Alan García left the APEC summit early to address the issue and the press has duly noted that the maximum sentence for treason (in times of war), the death penalty, was handed down in 1979 while the country was under military rule.

As far-fetched as it may seem, there are reasons why Chile would be interested in obtaining information from within the Peruvian government and military. The two nations recently presented their cases to the ICJ in The Hague over their disputed maritime border (an area that contains a wealth of mineral deposits). Peruvian aerial surveillance of the area could be strategic for Chile. However, such a hypothesis is only conjecture. More details will surely emerge as the trial gets underway. In the meantime, this case has certainly turned up the heat in a continent already near its boiling point. Just in time for summer.

Gas matters

This week, officials at Bolivia’s YPFB natural gas company reported that Brazilian and Argentinian demand for Bolivian natural gas increased in October. Although still below the maximum amount of natural gas these countries can contractually import from Bolivia, officials are nevertheless breathing a sigh of relief.

In Brazil, abundant rainfall creates more hydroelectricity which in turn requires less natural gas imports from Bolivia. Brazil’s government is also investing in multiple forms of energy and has begun to import liquefied natural gas from countries other than Bolivia due to the comparatively higher price of natural gas and its transportation. Argentina, Uruguay, and Chile are doing the same. This is significant since the nationalized natural gas industry in Bolivia supports the government’s extensive and costly social programs, the foundation of Morales’ public support.

While this is a temporary relief for Bolivia, it also serves as a warning of what is to come. With natural gas revenues so closely tied to Morales’ political capital, leaders are searching for solutions. However, in a world moving towards alternative energy and increased diversification in suppliers, creative thinking will be paramount. Time may be running out for dependence on this natural resource.

The samba-otic relationship

In recent years, international observers have worried about the growing threat of a nuclear Iran. Despite numerous talks and behind-the-scenes efforts, enrichment has nonetheless continued. Meanwhile, South American countries have been busy promoting bilateral trade, economic cooperation, and political support with Iran. Many of these nations are led by like-minded leaders, including Venezuela’s Hugo Chavez and Bolivia’s Evo Morales, but Brazil stands out as the most influential of these allies.

Brazil has been deepening ties with Iran as part of Lula da Silva’s overall vision to increase the international economic, trade, and political influence of the southern hemisphere. Heavy lobbying on the part of Lula was involved in the shift from the G8 to the G20 and the awarding of the 2016 Summer Olympics to Rio de Janeiro. Brazil was also just given a two-year seat on the UN Security Council.

For this reason, Monday’s announcements from Iran likely caused ripples across diplomatic circles in the Western hemisphere. Iran’s Deputy Minister for America Affairs told the media that when Ahmedinejad travels to Brazil in November for his first visit as head of state, he and Lula will likely eliminate visa requirements for Iranians traveling to Brazil (and visa versa). Brazilian officials also affirmed their belief that the Iranian regime has the right to develop nuclear energy for pacific purposes. They would like to be among those investing in Iran’s nuclear development, in addition to forming other gas, petrochemical, and medical agreements. Brazil is currently Iran’s eighth-biggest trade partner; already sending food, minerals, cars, and other products to the Middle East.

While Brazil is not the only Latin America country embracing the South-South integration strategy, it is certainly the most powerful and boasts of the brightest futures. With a temporary seat on the UN Security Council, Brazilian diplomats will play a role in determining how the world moves forward with an increasingly troublesome Iran. American and European diplomats already have their hands tied on the Security Council due to China and Russia’s relationships with Iran. A larger number of allies and support networks will help Iran lessen the impact of any additional sanctions imposed by the Security Council. The obvious lesson here is that what happens in your backyard can have far reaching consequences.

A shining example

Despite recent indigenous unrest, an ever-present rebel group (the Shining Path), and increased narcotics cultivation, the sun shined on Peru today. The country was named the second-best environment in Latin America for both public and private investment by the Inter-American Development Bank and the Economist Intelligence Unit.

With Alan García at the helm, Peru’s economy and government have steered towards private management of its abundant natural resources and allowed the government to save profits during booms which opened the door to adequate stimulus during the recession. The only country that ranked higher was Chile, another nation that practiced conservative fiscal policies during recent commodity windfalls.

The experts also ranked Peru third in the region for the way the country has coordinated various levels of government to better society. This is seen as a fundamental element in bridging socioeconomic differences across the country and region and is currently being discussed at the 2nd Summit of the National Public Investment System (SNIP) of Latin America and the Caribbean in Lima. Despite its problems, Peru has quietly been showing the region how public investment can be done in a way that is beneficial to its people and economy.

Bem-vindo!

Tomorrow, the UN General Assembly will likely vote to give Brazil a two-year seat on the Security Council (there are no other contenders in the region). Brazil has been pining for permanent membership to reflect its growing regional and global influence, but will have to suffice for the temporary membership, at least for the time being. While it’s not Brazil’s ultimate goal, it is nonetheless another coveted international title obtained in the past month.

Still high off the news that the 2016 Summer Olympics will be heading to Rio de Janeiro, Brazilians have much of which to be proud. Their economy has fared the recession better than many others across the globe. Their president, Luis Lula da Silva, boasts of an unusually high popularity rating, even as his term is nearly over. Among his causes are a greater stake in international decision making for developing nations. Evidence of such a shift is evident not only by the Olympic decision and tomorrow’s expected UN Security Council vote, but also the recent G20 summit that exchanged the industrialized, northern nations for the a mix between the traditional powers and those on the rise. Like Brazil.

While Brazil isn’t one of the top countries that dominate international political, military, and economic affairs, there is no denying its growing clout. A member of the BRIC nations, Brazil is living up to the image it has tirelessly projected in recent years. As Lula’s presidency winds down, he will surely be proud that he has brought his country closer to one of his major objectives; obtaining a permanent seat on the UN Security Council. Though it will last for just two years, it is clear that there will be many more to come.

Because 20 is better than 8

The economic crisis has profoundly changed the global balance of power. The most visible reflection of this shift is the move away from the G8 (Canada, France, Germany, Italy, Japan, the United Kingdom, the United States, and Russia) in favor of the G-20 (the G8 plus the European Union, South Korea, Argentina, Australia, Brazil, China, India, Indonesia, México, Saudi Arabia, South Africa, and Turkey). The G-20 is currently meeting in Pittsburgh and marks a notable demographic shift towards the southern hemisphere after months of protests over the disproportionately small stake developing nations have in the international financial system.

Since the outbreak of the recession, these developing nations have repeatedly expressed outrage that their economies were subject to the tsunami created by the rich, G8 world while their governments lacked the ability to implement corrective policies at a global level. Lula da Silva has been particularly vocal and, this spring, he called for increased participation of developing economies at the IMF and World Bank. That call was heeded today when the G-20 announced that the stake of developing nations would increase by at least 5% at the IMF and 3% at the World Bank, highlighting just how radically international politics are changing. While these percentages may not seem high, they are increasing only because those of the G8 countries will be decreasing.

Host city Pittsburgh was chosen for its ability to change with the times and because it exemplifies how an industrial giant can transform into a thriving modern, green city. The symbolism couldn’t be stronger, and it seems the G8 was open to the message. The crisp fall wind is ushering in a new era a year after the world was jolted by the largest financial shock since the 1930’s. The response is proving to be equally earth-shattering.

No-fly zone

The contentious dispute between Argentina’s top political couple, the Kirchner’s, and the opposition media group, Clarín, has reached new heights. This week, Aerolíneas Argentinas entered into the fray by refusing to distribute Clarín or La Razón newspapers to their first and business class customers in addition to other daily papers. Their reasoning would be laughable if it didn’t clearly indicate the growing conflict of interest on the part of the country’s top political couple.

Yesterday morning, Clarín delivery trucks were directed to management when they arrived at the airport with the daily newspapers. They were then informed that the papers would no longer be distributed due to a new initiative to decrease weight on planes and cut costs. The price component doesn’t hold much weight as La Razón is free. In regards to the need to decrease weight, it is hard to believe that thirty newspapers makes much of a difference. If that is the case, why doesn’t Aerolíneas eliminate papers towels from the bathroom (there is, after all, toilet paper) and consider cutting the pilot crew in half? It is difficult to imagine a more bizarre and unbelievable argument.

This blatant interjection of officials in business and in particular, the press, worries many. Lauro Laíño, the president of the Association of Argentine Journalism Associations (ADEPA), pointedly warned that the media is being threatened from multiple angles at the group’s 47th annual conference today in Salto. The involvement of presidents in matters of journalism are never well received, with the most dramatic examples including the current environment in Venezuela and Italy. Whether the Kirchner’s will carry forth this battle to the lengths of Chavez and Berlusconi remains to be seen. However, the deteriorating relationship between the official government and one of the country’s most important media groups does not bode well for the country’s democracy or general standards of living. Consumers beware.

Showtime

It is not the Fourth of July, but the amount of diplomatic fireworks going off in New York at the UN General Assembly meeting may give the impression otherwise. After a nearly two-hour rant by Libya’s Gadhafi and yet another boycotted speech by Iran’s Ahmadinejad, Hugo Chavez will take center stage tomorrow. It will fall on the same day that President Obama leads the UN Security Council meeting in hopes of convincing pivotal nations (i.e. Russia and China) to take a harsher line in regards to Iran’s nuclear program.

Despite widespread concern over human rights in Iran, the country has become an important player in Latin America. Leaders of ALBA nations (and even Brazil) have forged diplomatic, economic, military, and even reported nuclear agreements with President Ahmadinejad. Russia and China are also enjoying growing influence as populist leaders across the region seek allies outside the “US empire”. In addition to the handshakes and agreements, domestic politics in South America have begun to mirror those of their questionable allies. This rings particularly true in Chavez’s own yard where opposition leaders frequently find themselves prosecuted on shaky charges, media outlets are censored and threatened, protesters are harassed and jailed, and the man in charge appears to use elections as a tool to mandate his own indefinite rule.

The latest edition of The Economist featured an article about democracy in Venezuela and concluded by warning that the country’s future could be marked by “rigged elections, media censorship, the criminalization of dissent, and leaders for life”. To me, the events of recent years and months clearly indicate that the question is not if or even when, but how severe it will be and for how long it will last. Tomorrow’s speech will likely ally Chavez with the Gadhafis and Ahmadinejads of the world. Perhaps in ten or fifteen years he will be the one sneaking his tent from one suburb to another trying to get a good night’s sleep. The important question is what price will Venezuelans and other South American countries pay for this egocentricity.