A snapshot of policy trends and successes in the region.
Brazil’s government, seeking to extend its control over rapidly expanding offshore oil reserves, has walked into a political and constitutional quagmire.
A law that was close to receiving presidential approval as we went to press will mandate that oil royalties and taxes on windfall profit, previously directed to producing states, be divided among all of Brazil’s 27 states and 5,500 municipalities. It means big money for a country expected to produce about seven million barrels of oil per day by 2020—more than triple today’s production. Under the proposed law, which has already received approval by the Brazilian Congress and Senate, once the cost of producing a barrel of oil is taken out, 71 percent of what’s left goes to the government in the form of royalties and taxes, and only 29 percent goes to the company that produced it.
If the law is enacted, many cities and states will be in line to get tens of millions of dollars a year in new revenue. The funds will be divided equally among recipients based on current federal transfer arrangements. But the State of Rio de Janeiro and dozens of its municipalities—which are home to 85 percent of Brazil’s oil and gas output—will lose more than 95 percent of the 8.71 billion reais ($5 billion) a year it receives directly from two types of oil royalty.
Latin America has made significant strides in shoring up its public debt. Previously constrained by what financial experts consider the “original sin”—relying on foreign currency borrowing to finance domestic projects, which inevitably leads to a currency mismatch—the region is now heading toward a more balanced currency composition of government debt. This reached a milestone in August 2010 when the average ratio of local currency-denominated debt to total public debt reached a historic high of 65 percent in the region’s seven largest economies.
The new composition of public debt has allowed governments to smooth the effects of capital flight and currency devaluations on debt sustainability, which exacerbated the last two financial crises in Asia and Latin America.
Similarly, the deepening of domestic bond markets has offered crucial funding alternatives during the global credit crunch. Asian governments and corporations have reaped the greatest benefits. At the end of 2009, Asia accounted for 65 percent of local-currency-denominated bonds in emerging markets, three times the 22 percent share of Latin America.
Violence against women, a result of gender inequality and unequal power relations between men and women, is a pervasive phenomenon. It occurs in all social classes and in all countries, from the most developed to the least developed. Despite progress in policies and legislation, it remains one of the top human rights issues in the Americas today.
Although little research exists, available data suggest the situation is bleak across the region. The Economic Commission for Latin America and the Caribbean (ECLAC) estimates that up to 40 percent of women in the region have been victims of violence at some point during their lives.1 And, according to figures from the 2004 Demographic and Health Surveys Project, 44 percent of women in Colombia have suffered from spousal violence. In Peru, physical violence affects 47 percent of women.
Femicide—the killing of women—has reached alarming levels in Latin America. The most recent region-wide statistics available, from 2003, show that seven Latin American countries score among the worst 10 nations when measuring the rate of femicide per one million women in 40 countries. In 2003, Guatemala had the world’s highest rate with 123 femicides per one million women. Colombia (70), El Salvador (66), Bolivia (43), Dominican Republic (37), Mexico (24), and the United States (22) followed.2 More recent figures from Guatemala showed that in 2006 two women, on average, were murdered each day.
NOW ON AS/COA ONLINE
- August 25, 2015
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