This week's likely top stories: Juan Carlos Varela takes office as Panama's new president; Argentina negotiates a settlement with holdout creditors; the ELN attacks in Arauca; Costa Rica and Colombia advance to the World Cup quarterfinals for the first time; Argentine Vice President Boudou faces charges.
Juan Carlos Varela inaugurated in Panama: Panamanian President-elect Juan Carlos Varela will be officially sworn into office on Tuesday with a number of regional leaders in attendance, including a U.S. delegation led by Secretary of State John Kerry. Varela, of the Partido Panameñista (Panameñista Party) was elected on May 4 over José Domingo Arias of the Cambio Democrático (Democratic Change) party, earning 39 percent of the vote over Arias’ 32 percent, though Varela’s party only won 11 seats in Panama’s 71-seat legislative assembly. Varela, Panama’s former vice president, has promised to fight corruption and improve government transparency while continuing to improve Panama’s infrastructure.
Argentina to negotiate as interest payment comes due: With a $539 million interest payment on bonds due today (Monday), Argentina has 30 days to make the payment to avoid its second default in 13 years. Earlier this month, the U.S. Supreme Court rejected Argentina’s appeal in a long-running battle with holdout creditors after it defaulted on its debt in 2001. The Supreme Court decision allowed a lower court ruling to stand, which requires Argentina to pay a group of holdout creditors some $1.3 billion before it can pay other bondholders. The country has one month to negotiate a settlement with the holdouts in U.S. District Court to avoid a default.
Attack on oil camp in Western Colombia leaves 13 injured: The Colombian government has accused the Ejército de Liberación Nacional (National Liberation Army–ELN) of attacking on a camp in the Caño Limón oilfield in the Colombian state of Arauca in western Colombia, injuring 13 people as they were preparing to attend Sunday Mass. While the ELN has traditionally carried out attacks on oil pipelines themselves, Colombian Minister of Mining and Energy Amylkar Acosta said this was the first time they had attacked a camp for workers, and accused the ELN of cowardice. The ELN has agreed to engage in formal peace talks, but have yet to agree to a formal truce; they have been accused of three other attacks on the same oil pipeline in the last ten days.
Costa Rica and Colombia make World Cup history: Costa Rica and Colombia both advanced to their teams’ first-ever World Cup quarterfinals this weekend, after Colombia defeated Uruguay 2-0 on Saturday and Costa Rica beat Greece in a penalty shootout on Sunday after tying 1-1 in regulation time. Colombia—led by 22-year-old James Rodríguez, who has scored at least one goal in each of his first four World Cup games—will face host country Brazil in the quarterfinals on July 4. Costa Rica will face the Netherlands on July 5 after the Dutch defeated Mexico on Sunday with a controversial penalty kick.
Argentine vice president charged with bribery: An Argentine judge charged Vice President Amado Boudou with bribery and corruption on Friday. If he is found guilty, Boudou could face between one and six years in prison. Boudou is accused of using his position as economy minister to interfere in bankruptcy proceedings against a printing company—charges that he denies. He is the first sitting Argentine vice president since 1983 to face such charges.
This week’s likely top stories: the FIFA World Cup kicks off in Brazil; Colombian voters return to the polls; Venezuelan protesters call for the release of Leopoldo López; President Enrique Peña Nieto defends Mexican reforms in Spain; Argentine Vice President Amado Boudou testifies in court.
World Cup Begins in Brazil Amid Subway Strike: The FIFA World Cup will officially open on Thursday, June 12, with the opening match between Brazil and Croatia at Arena Corinthians stadium in São Paulo. Meanwhile, protesters clashed with police in São Paulo as they supported a subway workers’ strike that began last Thursday when metro employees called for a 12.2 percent salary increase ahead of the tournament. On Sunday, the subway workers’ union voted to continue the strike indefinitely, which will inevitably affect transportation to the Arena Corinthians stadium 12 miles east of central São Paulo. A São Paulo labor court has fined the union $175,000 and said it will add $220,000 per day that the work stoppage continues.
Colombian Runoff Elections: Colombian voters will return to the polls on Sunday to choose between current President Juan Manuel Santos of the Partido de la U and challenger Óscar Iván Zuluaga of the Centro Democrático in what is expected to be a very tight race for president. The Fuerzas Armadas Revolucionarias de Colombia (Revolutionary Armed Forces of Colombia—FARC), who have agreed on three points of a six point peace agenda with the Colombian government in Havana, announced a three-week ceasefire from June 9 to June 30 in recognition of the June 15 runoff election. The government and the FARC recently announced the creation of a truth commission to investigate the deaths of the estimated 220,000 people killed in the country’s 50 year-old internal conflict.
Venezuelan Opposition Calls for Release of Leopoldo López: Members of the Venezuelan opposition protested in Caracas on Sunday to call for the release of opposition leader Leopoldo López, who has been imprisoned since February 18—and are also demanding new presidential elections as soon as possible. López was formally charged in April by Attorney General Luisa Ortega Díaz of damaging property, arson and instigating violence in the February 12 protests that set off a wave of anti-government demonstrations across the country. Those charges were upheld last week by Judge Adriana López, who concluded that López must remain in custody. At least 42 people have died in protest-related violence.
Enrique Peña Nieto Defends Mexico’s Reforms: In a speech delivered at a meeting of business and political leaders in Madrid, Mexican President Enrique Peña Nieto defended the political and economic reforms he has passed during his time in office. In the conversation, the president signaled that the introduction of foreign capital into the energy sector would make Pemex a “productive industry of the state,” rather than just an “industry of the state.” He added that Mexico is attempting to deepen its relationship with its Latin American neighbors, citing Mexico’s participation in the Pacific Alliance alongside Chile, Colombia and Peru. Enrique Ochoa Reza, head of Mexico’s Comisión Federal de Electricidad (Federal Commission of Electricity—CFE), and Spanish energy company Iberdola also signed a collaborative agreement.
Argentine Vice President Boudou Appears in Court: Argentine Vice President Amado Boudou is expected to testify on Monday in a criminal corruption probe for his possible involvement in a corruption and influence-peddling scandal. Boudou is accused of using his position as economic minister of Argentina to illegally lift bankruptcy proceedings against the Ciccone Calcografica printing company in return for 70 percent ownership of the firm in 2010. Boudou will appear before prosecutor and federal judge Ariel Lijo in a closed court session. Bodou denies any wrongdoing and asked that Monday’s court session be broadcast before the Argentine public—but that request was denied.
Yesterday, Federal judge Ariel Lijo changed Argentine Vice President Amado Boudou’s court date from July 15 to June 9. Boudou will face charges of corruption, illegal negotiations as a public employee, and illegal profiteering related to his purchase of the Ciccone Calcográfica printing company with a partner in 2010. Boudou allegedly planned to use the company to print bank notes and official documentation. Given that he was economic minister at the time, the acquisition would have been illegal according to Argentine law.
The vice president maintains his innocence and has challenged the judge to have a televised trial. On Wednesday his defense team requested that the summons be annulled, claiming that the allegations were based on “false affirmations, lacking legal, factual and evidential substance.”
Once seen as a possible successor to President Cristina Fernández de Kirchner, Boudou met yesterday with the president, who after months of maintaining her distance, has expressed her support for the defendant and ordered him to accept the summons.
He has since cancelled a trip planned for next week to attend the Architecture Biennial in Venice, Italy. In a strange coincidence, the mayor of Venice, Giorgio Orsoni, was arrested yesterday along with 34 others on charges of bribery and corruption.
Top stories this week are likely to include: Dilma Rousseff in Washington; Sixth Summit of the Americas on Saturday; Chávez possibly seeking treatment in Brazil; Maras and Zetas reportedly joining forces; and Boudou under investigation.
Dilma in Washington: Brazilian President Dilma Rousseff begins a three-day visit to Washington today, where she will meet with her U.S. counterpart Barack Obama. This is Rousseff’s first visit to the U.S. since taking office in January 2011. Aside from meetings at the White House, Rousseff will speak at the U.S. Chamber of Commerce later today, and give a public speech at Harvard University tomorrow. In the Financial Times, Moisés Naim calls for the two countries to agree to a trade deal as a tangible outcome. Adds AQ Editor-in-Chief, Christopher Sabatini, “There will be plenty to discuss, from improving bilateral commerce and investment, Brazil’s recent flurry of legislation favoring local content and business, Iran, and—I hope—the upcoming presidential elections in Venezuela.”
Summit of the Americas on Saturday: Cartagena, Colombia, will host this weekend the Sixth Summit of the Americas, the regional conference of heads of state organized under the aegis of the Organization of American States. This year’s theme is “Connecting the Americas: Partners for Prosperity.” But will the summit yield any significant results? Notes Sabatini: “While this will be a great opportunity to show off how far Colombia has come in the 18 years since the summit process started, there is really very little the summit can accomplish beyond speeches and vague promises.”
Chávez May Seek Treatment in Brazil: Although Venezuelan President Hugo Chávez landed in Havana on Sunday to receive his latest round of radiotherapy, Brazilian media has been reporting that Chávez may seek further treatment at Sírio-Libanês hospital in São Paulo. This is the same hospital where former Brazilian President Luiz Inácio Lula da Silva last year successfully recovered from cancer surgery. Specifically, O Globo has reported—citing anonymous sources—that Chávez’ cancer has metastasized and may spread to his liver. Although the Venezuelan embassy in Brasília has denied the reports, pay attention to how this story develops over the coming days.
Maras-Zetas Alliance: Guatemalan authorities this weekend reported that the deadly Mara Salvatrucha gang, which dominates Central America’s Northern Triangle, has formed a pact with the equally dangerous Zetas group in Mexico for control of key drug transit routes from South America to the United States. In an already violence-plagued Central America, the alliance spells bad news for counternarcotics officials and may bolster the positions of Guatemalan President Otto Pérez Molina—a proponent of drug legalization—at this weekend’s Summit of the Americas. “An alliance between two of the region’s most feared criminal networks yet again reinforces the critical need for a real regional approach to reducing insecurity. The drug traffickers don’t respect borders and neither should counternarcotics efforts,” notes AQ Senior Editor Jason Marczak.
Future of Boudou: Argentine Vice President Amado Boudou is now under investigation by federal authorities for his actions as economy minister—in the two years prior to assuming the vice-presidency—specifically that he helped printing company Ciccone Calcográfica get out of bankruptcy. Boudou has denied the charges and still has the full support of President Cristina Fernández de Kirchner and her administration. After a raid of Boudou’s apartment last week, there may be new developments this week on the ongoing investigation.
Three days after announcing her re-election bid, Argentine President Cristina Fernández de Kirchner (CFK) revealed the selection of Amado Boudou, the current economy minister, as her running mate in the October 23 election. Boudou, 47, is one of the cabinet’s most charismatic members and observers believe that his age will help court young voters.
Boudou is also popular among the electorate for his accomplishments in public office. Prior to his current post, he was in charge of Argentina’s pension funds. During this period—the nadir of the global recession—Boudou was instrumental in advocating for the nationalization of privatized pension funds. He remains adamant that Argentina’s inflation rate, hovering near 25 percent, is not an issue—instead pointing to the economy’s growth rate of 9.1 percent during the first four months of 2011.
The selection of Boudou was welcomed by kirchneristas as he belongs to CFK’s Peronist Frente para la Victoria (Front for Victory—FPV)—unlike incumbent Vice President Julio Cobos, who belongs to the opposition Unión Cívica Radical (Radical Civic Union—UCR). CFK and Cobos have frequently clashed and barely speak to each other.
In a poll taken last week, CFK led the field of candidates with 47 percent support. If a candidate receives at least 45 percent of the vote in October, s/he wins the presidency and a runoff is avoided.
June 1: This AQ-Efecto Naím segment looks at sustainable cities in the hemisphere.