Top stories this week are likely to include: UNGA high-level meetings get underway; Enrique Peña Nieto concludes Latin America tour; mining strike continues in Bolivia; Federico Franco and Mariano Rajoy discuss Ibero-American Summit; and Evo Morales visits Cuba.
UNGA High-Level Meetings Kick Off: The sixty-seventh session of the United Nations General Assembly (UNGA) began last week, and this week the focus shifts to a series of high-level meetings along with general debate among the many heads of state representing the United Nations’ 193 member-countries. The high-level meeting on the rule of law takes place today at the New York secretariat. General debate begins tomorrow morning with Brazilian President Dilma Rousseff delivering the first address for the second consecutive year.
Peña Nieto Concludes LatAm Tour: Mexican President-elect Enrique Peña Nieto will arrive home today after completing a six-country tour through Latin America in advance of his December 1 inauguration. Peña Nieto visited Guatemala, Colombia, Chile, Argentina, Brazil, and Peru. In his most recent stop, Peña Nieto and Peruvian President Ollanta Humala agreed yesterday to strengthen ties on public security issues, particularly in the fight against organized crime and drug trafficking. The Mexican president-elect called for strengthening the Pacific Alliance and will round out his tour by meeting with 180 Peruvian businessmen today to discuss ways to boost trade ties. “This was a successful trip for Peña Nieto to show the leadership that his government wants to take in the hemisphere and how he will aim to collaborate on key issues for Mexico,” notes AQ Senior Editor Jason Marczak.
Mining Strike in Bolivia: In the escalating standoff this month between the Bolivian government and cooperative-member miners over the Colquiri tin and zinc mine, perhaps this week could see a development. Although the Federación Sindical de Trabajadores Mineros de Bolivia (Union Federation of Miners in Bolivia) broke off talks on Saturday with a delegation sent by Bolivian President Evo Morales, Minister of Government Carlos Romero called for further dialogue over the rights to Colquiri. The Bolivian government expropriated the mine from a Swiss company in June 2012.
Franco, Rajoy to Discuss Ibero-American Summit: Paraguayan President Federico Franco and Spanish Prime Minister Mariano Rajoy will meet on the sidelines of UNGA in New York this week to discuss the status of Paraguay’s presence at the Ibero-American Summit to be held in Cádiz, Spain in November. Given Paraguay’s suspension from Mercosur and Unasur in response to the impeachment of former President Fernando Lugo, it was revealed that a Spanish diplomat traveled to Asunción recently to dissuade Paraguay from participating in the summit in the hope that Argentina would attend. Look for developments from the Rajoy-Franco discussion this week.
Evo Morales Visits Cuba: Bolivian President Evo Morales made an unannounced stop in Havana enroute to New York for the UNGA, where he was greeted by Cuban Foreign Minister Bruno Rodriguez according to Cuban state television. Today, Morales receives a doctorate degree, honoris causa, in political science from the University of Havana.
Cuba’s power grid gradually came back online yesterday morning after a massive blackout left 5 million Cubans without electricity on Sunday evening. The outage affected Havana and much of the western half of the island and was caused by an "interruption in a transmission line" near Ciego de Avila, 250 miles west of the capital, according to the Ministry of Basic Industries.
Electricity began to return to the capital around 1:00 a.m. yesterday morning and the most of the city was back online by 9:00 a.m. While the blackout primarily affected western Cuba, outages were reported as far away as Santiago, the nation's second-largest city located about 475 miles away on the eastern tip of the island. Cuba's electric company said yesterday that further outages might occur at peak hours throughout the day, but that it hoped to have normal service restored by today.
Minor blackouts are not uncommon in Cuba due to the country’s antiquated electrical system. But Sunday’s outage was reminiscent of the frequent, massive blackouts that plagued the island in the early 1990s. The period of economic depression that followed the collapse of the Soviet Union, known in Cuba as the Special Period, caused major fuel and electricity shortages that made Sunday’s events a near-daily occurrence.
A Cuban court charged 12 former government officials and executives with corruption for their involvement in a project to expand a nickel and cobalt processing plant in eastern Cuba, according to a report on Tuesday by the Communist Party newspaper Granma. The crimes occurred “during the negotiation, contracting and execution of the expansion of the Pedro Soto Alba nickel and cobalt plant." Nickel is Cuba’s top export, and the Pedro Soto Alba nickel mine—a joint venture between state-owned nickel company Cubaniquel and Canadian mining company Sherritt International Corp.—is the largest in Holguín province.
Most of the charges involved the misuse of financial resources. The harshest prison sentences were handed down to Alfredo Rafael Zayas Lopez (12 years), Ricardo González Sánchez (10 years) and Antonio Orizón de los Reyes Bermúdez (eight years)—all former vice ministers of the Ministry of Basic Industry, which oversees nickel production. Cristobal de la Caridad Saavedra Montero, a former business director at Cubaniquel, was given a six-year sentence. The remaining eight defendants received between four and seven years each.
Since taking over for his brother Fidel in 2008, President Raúl Castro has stepped up the government’s fight against corruption, which he considers one of the “principal enemies of the revolution.” During a Communist Party Conference in January, Castro said he would be “implacable” against offenders. Given the Ministry of Basic Industries alleged involvement in the Pedro Soto Alba plant scandal, the Castro government disbanded it and replaced it shortly thereafter with the Ministry of Energy and Mines.
Top stories this week are likely to include: Fidel Castro’s birthday; Buenos Aires subway shutdown continues; public teachers to end striking in Panama; talks to renew in Colombia between the government and the Indigenous Nasa; and a possible dialogue over Venezuela’s detained U.S. Marine.
Fidel Turns 86 Years Old: Cuba’s revolutionary leader and former president, Fidel Castro, turns 86 years old today. He faces health issues, having stepped down from the presidency in 2006 after undergoing intestinal surgery—and has not been seen in public or mentioned in the news since June 19, according to Reuters. AQ Editor-in-Chief Christopher Sabatini notes of the occasion, “Six years ago when Fidel Castro stepped aside to pass the torch to his brother Raúl, people thought the end was near. Give the man's staying power credit, but really, what modern country in the region and in the world remains as centered and fixated on an 86-year-old man? It's a sign of how little Cuba—and U.S. policy toward the island—has progressed. We're all stuck in the past.”
Subway Shutdown in Buenos Aires: A strike by union employees of Buenos Aires’ municipal subway system is entering its tenth day today, with no end in sight after talks broke down on Friday with the administration of Mayor Mauricio Macri. The subway shutdown has inconvenienced between 600,000 and 1 million daily commuters. Macri, the most prominent figure of the opposition Propuesta Republicana (Republican Proposal—PRO) party, is blaming the ruling Frente para la Victoria (Front for Victory—FPV) party, to which President Cristina Fernández belongs. Macri is accusing FPV operatives of inciting the union workers, who are demanding a 28 percent increase in pay. Buenos Aires Deputy Mayor Maria Eugenia Vidal stated that the city officials “just don’t have the means to pay for this.” Pay attention to see if there will be any breakthrough in negotiations this week.
Teacher Strike to End in Panama: Leaders of a teacher strike in Panama reached an understanding with the government on Saturday to end the weeklong strike today. Teachers were protesting over issues such as decaying classrooms and insufficient pay.
Santos-Nasa Mediation To Resume in Colombia: Leaders of the Indigenous Nasa group expect to set a date by this Tuesday for the resumption of mediated talks with the government of Juan Manuel Santos. More than 10,000 Nasas marched in the department of Cauca yesterday demanding the government return to the table. Cauca, in southwest Colombia, is home to many rebels belonging to the Fuerzas Armadas Revolucionarias de Colombia (Revolutionary Armed Forces of Colombia—FARC). The Santos administration, therefore, has placed many Colombian soldiers in Cauca as part of the ongoing internal conflict with the FARC, which the Nasa view as a threat to their territorial sovereignty. The Nasas and the government, however, hope to reach an agreement through mediation.
Venezuela-U.S. Showdown Over Detention: After Venezuelan President Hugo Chávez announced late last week that police have detained an American citizen who claimed to be a former U.S. Marine, tensions have flared between the U.S. and Venezuelan governments. According to the Associated Press, a State Department official said that the U.S. authorities were not notified of his arrest. Chávez has openly suspected that the detainee, whose name has not been released, may be a “mercenary” scheming to destabilize Venezuela. Stay tuned to see if there may be more updates on this case in the coming week.
EXTRA, Rio 2016: After yesterday’s closing ceremony of the 2012 Olympic Games in London, the world’s attention turns to Rio de Janeiro for 2016. But is the city ready? Check out AQ’s television segment on Brazil and the Olympics on the “Efecto Naím” program on NTN24.
Today and tomorrow, Indian External Affairs Minister S.M. Krishna will host the foreign ministers of Chile and Venezuela, Alfredo Moreno Charme and Nicolas Maduro, and Cuban Foreign Affairs Vice Minister, Rogelio Sierra. The meeting marks the first official dialogue between representatives of the 33-member Comunidad de Estados Latinoamericanos y Caribeños (Community of Latin American and Caribbean States—CELAC) and the South Asian country.
According to senior foreign ministry officials, the main objective of the summit is to strength the strategic and economic relationship between India and Latin American and the Caribbean, increasing contact points despite the great geographical and cultural distances. “A meeting with the external affairs minister in this format is indicative of interest (from both sides) in raising engagement between India and the CELAC,” said India foreign ministry spokesman Syed Akbaruddin.
Over the past decade, relations between India and Latin America and the Caribbean have continued to grow, as professor Jorge Heine and ambassador R. Viswanathan showed in their article in the Spring 2011 issue of America Quarterly. Prime Minister Manmohan Singh and former President Pratibha Patil visited several countries in the region over the past four years, and 10 Latin American presidential visits to India were made between 2001 and 2011. India’s trade with CELAC increased from $2 billion in 2000-2001 to $25 billion in 2011-2012. CELAC receives about $16 billion in Indian investment, which mainly revolves around the hydrocarbon sector, information technology, pharmaceuticals, and minerals. Investment in the energy sector totals $8 billion, but further investment is likely given India’s growing energy needs.
CELAC was created on February 23, 2010, at the Rio Group–Caribbean Community Unity Summit and formally established in July 2011 at a summit in Caracas, Venezuela. It includes 33 countries in the Americas, representing roughly 600 million people, with the notable exceptions of Canada and the United States.
Top stories this week are likely to include: Chávez travels to Brazil for Venezuela’s formal incorporation into Mercosur; Foreign mining to continue in Peru, as Humala marks one year in office and reaffirms commitment to social spending; Cuba set to further open its economy; Argentina tightens control over energy industry; and Colombia’s economy slows.
Chávez travels to Brazil: Venezuelan President Hugo Chávez travels to Brasilia today—his first official foreign trip of the year—to attend Tuesday’s Mercosur summit. The gathering has been convened to formalize Venezuela’s entry into Latin America’s largest trade bloc, whose members include Argentina, Brazil, Paraguay, and Uruguay. Paraguay’s membership was suspended on June 28 following the ouster of President Fernando Lugo. For six years, Venezuela’s entry had been blocked by the Paraguayan parliament, but once suspended, the other three countries quickly moved forward with Venezuela’s membership. Still, questions remain about the process in which Venezuela has joined Mercosur: “Suspending Paraguay due to Mercosur’s determination that it undemocratically removed President Lugo, and then using the opening created to then welcome in Chávez is a double standard. Clearly, realpolitik won out over ideology,” says AQ Senior Editor Jason Marczak. It is expected that Chávez will use the visit as a sign of his good health and strength to compete in Venezuela’s presidential elections on October 7.
Mining—and associated controversies—to continue in Peru: Production is expected to resume in the next few days at the La Oroya metallurgical complex in the Peruvian Andes, after the plant—owned by the U.S.-based company Doe Run—had been shut down for three years. Rocío Chávez, the manager of Doe Run Peru, said operations will begin with the zinc-processing circuit and continue with the processing of lead and copper.
The announcement that metallurgical operations would resume in the small mountain town of La Oroya, where economy has long depended on mining but where residents have suffered from exposure to the plant’s toxic wastes and emissions, coincided with President Ollanta Humala celebrating one year in office. With his approval rate having fallen to an all-time low of 40 percent—largely a result of social unrest over mining (today there are more than 250 disputes nationwide over natural resources)—Humala vowed to ramp up social spending for the poor and spread the benefits of Peru’s economic boom to all its citizens.
Cuba to continue opening its economy: Following last week’s meeting of the National Assembly, Cuba will begin implementing a series of reforms that will continue moving its economy in a more market-friendly direction. A new tax law—to be published next month and to go into effect next year—will replace an old Soviet-style system and eventually require everyone to pay income and property taxes for the first time since the 1960s, according to Marino Murillo, head of the Communist Party commission responsible for implementing reforms. Murillo also announced that an unspecified number of state-owned companies will be partially deregulated by the end of the year. They will be allowed to make day-to-day business decisions without awaiting government approval and will be evaluated on “four or five indicators” such as earnings and productivity. In addition, 222 small- to medium-size businesses will become cooperatives—previously an option only available in the agricultural sector.
Read more about Cuba’s economic opening in the latest issue of Americas Quarterly.
Controversy over government intervention in Argentina’s energy industry: Controversy over the state’s role in the economy is likely to continue this week in Argentina, following Deputy Economy Minister Axel Kicillof’s announcement last Friday that the federal government will assume greater control over private oil companies. According to a decree published in the Official Gazette, oil companies operating in Argentina will have to present an annual investment plan by September 30 and could face fines or other sanctions if they fail to comply with this and other rules. This morning, Planning Minister Julio de Vido denied that the government is “intervening” in the energy sector, calling the new regulations “planning, pure and simple,” but that is unlikely to put Argentine and foreign business communities at ease.
Colombian economy at risk of downturn: Economists and administration officials are likely to be keeping a close eye on Colombia’s economy as prices for oil—the country’s top export—continue to decline. On Friday Colombia’s central bank unexpectedly reduced its overnight lending rate from 5.25 percent to 5 percent—the country’s first interest-rate cut in two years. Central Bank president Jose Dario Uribe said, “Global economic growth continues to weaken more than expected;” the bank adjusted its forecast for economic growth in Colombia in 2012 to 3 to 5 percent, down from its previous target of 4 to 6 percent. Andres Langebaek, senior economist at Banco Davivienda SA, who correctly predicted the cut, forecasts that the Central bank will cut rates a further 0.75 percentage point by year-end. Analysts will be on alert for inflation, although the risk is “really benevolent,” said Camila Estrada, chief analyst at Bogotá-based Helm Bank SA.
Cuban police detained at least seven people on Tuesday immediately following the funeral service of Oswaldo Payá, a leading opposition figure who died in a car crash on Sunday. Shouting anti-government slogans, Guillermo Fariñas and other activists were detained upon exiting the San Salvador Catholic Church in Havana. Fariñas has staged hunger strikes to protest the state repression of dissidents; in 2010, he won the European Union’s Sakharov human rights award, which was granted to Payá in 2002.
According to official accounts, Payá and another dissident, Harold Cepero Escalante, died when their car hit a tree travelling near the town of Bayamo, in eastern Cuba. However, a number of dissidents—including some arrested on Tuesday—have raised suspicions of foul play. Payá’s 23-year-old daughter, Rosa Maria Payá, questioned the official version of the death in a speech at the funeral.
Payá is best known for launching a petition known as the Varela Project to call for greater civil liberties in Cuba, including the right of assembly and freedom of expression. Following the funeral service, Payá’s son said that his father had received multiple death threats over his career as a dissident, especially after the Valera Project.
Top stories this week are likely to include: López Obrador files a legal challenge to Peña Nieto’s win; cholera spreads in Cuba; standoff between Bolivia and a multinational Canadian mining firm; the Chávez factor in the U.S. presidential election; and Unasur sends a delegation to Paraguay.
López Obrador Contests Peña Nieto’s Victory: Although Enrique Peña Nieto won the July 1 presidential election according to the independent electoral authority Instituto Federal Electoral (Federal Electoral Institute—IFE) earlier this month by over 6 percentage points, runner-up Andrés Manuel López Obrador (AMLO) has now filed a legal challenge to the ruling, claiming fraud on the part of Peña Nieto’s Partido Revolucionario Institucional (Institutional Revolutionary Party—PRI). AMLO’s team says it will prove that “illicit money” was used to buy votes. Despite IFE having recounted over half the ballots and still upholding its verdict of Peña Nieto’s win, AMLO’s legal challenge submitted to IFE will now be forwarded to the Federal Electoral Court; in turn, the Court will deliver a ruling before early September.
AQ Editor-in-Chief Christopher Sabatini notes, “While fraud remains a problem in Mexican elections and with it people's trust in the results, AMLO is going to have an uphill battle explaining the direct, logical connection between any allegations of fraud and 3 million plus votes of difference between him and the winner, Enrique Pena Nieto."
Cuba and Cholera: According to the Cuban health ministry in a release over the weekend, there have been no new cholera-related deaths since the three ones reported earlier this month in the eastern city of Manzanillo. However, the health ministry has reported 158 cases of the disease, a significant increase from the 56 initially disclosed. Given that the health ministry has remained rather quiet, leading to rumors about a wider problem with the outbreak, pay attention this week to growing concerns about the spread of cholera.
Top stories this week are likely to include: post-election protests in Mexico; OAS to issue its report on Fernando Lugo’s ouster; anti-mining protests continue in Peru; Raúl Castro arrives in Vietnam; and ASEAN-Latin America Business Forum gets underway.
PRD Alliance Questions Peña Nieto’s Victory: Although officially declared the winner on Friday by the autonomous Instituto Federal Electoral (Federal Electoral Institute—IFE), Mexican President-elect Enrique Peña Nieto still faces criticism of fraud by second-place candidate Andrés Manuel López Obrador (AMLO) of the Partido de la Revolución Democrática (Party of the Democratic Revolution—PRD) . Ricardo Monreal, AMLO’s campaign manager, accused the PRI of vote-buying at a press conference this morning. In addition, tens of thousands of demonstrators claiming to belong to no political party protested over the weekend in Mexico City decrying the IFE result. Will the situation turn to a repeat of 2006? AQ Senior Editor Jason Marczak notes there’s a clear difference between the 2012 election and what happened six years ago: “With only a few hundred thousand votes separating López Obrador and Calderón in 2006, AMLO saw an opening for a recount through protests and pressure on a still fragile electoral process. But this time, in losing by about 3.5 million votes, AMLO will only serve to discredit his nationwide appeal by crying foul and once again being a sore loser.”
Updates on Lugo’s Ouster: The Organization of American States (OAS) is expected to release its report today on its fact-finding mission last week to Paraguay to investigate former Paraguayan President Fernando Lugo’s removal from office. The delegation was headed by OAS Secretary-General José Miguel Insulza. The U.S. has said it would wait for the OAS verdict to issue a formal statement on the legality of the ouster—a move that has drawn criticism. With Venezuelan Foreign Minister Nicolás Maduro reportedly endorsing a military coup to restore Fernando Lugo to power, the situation in Paraguay is still contentious and perhaps the OAS report will provide more clarity on the issue.
Peruvian Anti-Mining Protests Heat Up: After police clashed with protesters demonstrating against natural resource extraction in northwest Peru, the death toll has climbed to five. A state of emergency has been imposed in the Cajamarca region, and Peruvian President Ollanta Humala has come under fire for his administration’s handling of the demonstrations. Nevertheless, tensions are still high and this week could very likely see a new wave of protests. AQ Editor-in-Chief Christopher Sabatini, who is in Huaraz, Peru this week, notes, “President Humala will have to do something to address the protests, including trying to verify claims of pollution and improving overall access to social services in mining communities—while not appeasing some of the more extreme groups.”
Raúl Castro in Vietnam: After wrapping up a trip to China last week, Cuban President Raúl Castro arrived in Vietnam yesterday for a four-day official visit aimed to strengthen bilateral relations. This is Castro’s first visit to Vietnam as Cuba’s president, and he is scheduled to meet with Vietnamese Prime Minister Nguyen Tan Dung, Community Party General Secretary Nguyen Phu Trong and Vietnamese President Truong Tan Sang. Sabatini observes, “The purpose of the trip is twofold: First, to help Raúl and the group better understand the process of economic and limited political reform that has taken place in Vietnam as a model for Cuba—though the comparison is thin. But second, Cuba—in this and other efforts it has made—is trying to diversify its economic relations and lifeline beyond Venezuela.”
ASEAN, Latin America Deepen Commercial Ties: The third annual business forum between Latin American nations and ASEAN (Association of Southeast Asian Nations) members takes place today and tomorrow in Jakarta, Indonesia. The theme of the forum is: “Towards a Sustainable Future.” ASEAN is comprised of Brunei, Burma, Cambodia, Indonesia, Laos, Malaysia, Philippines, Singapore, Thailand, and Vietnam. For more information on the forum, including programs, speakers, organizers, and partners, access its website.
The government of Cuba yesterday restored import tariffs on noncommercial foodstuffs brought to the island by airline passengers travelling to the island as tourists. The decision, announced earlier this month by the Aduana General de la República (Cuba’s national customs agency), ends a four-year moratorium on the tariff imposed following hurricanes Gustav, Ike and Paloma, which hit the island in 2008.
It remains to be seen whether the decision to reinstate the tariff is tied to the growth of unofficial U.S. food exports to Cuba by way of U.S. citizens travelling to visit relatives on the island. But observers have noted that the tariff exemption mainly benefited owners of non-state cafes and restaurants, which have flourished amid the economic reforms undertaken by President Raúl Castro since 2010.
The authorities gave no estimate of how much money could be raised for the restoration of the tax. According to the statement, customs will maintain an exemption for less than 20 pounds of medication, provided they are separate from other luggage.