LatinNews Daily - 20 November 2024

On 19 November US Secretary of State Antony Blinken recognised the exiled opposition candidate Edmundo González as Venezuela’s “president-elect”.

Analysis:

Blinken’s description of González as president-elect represents a strengthening of US support for the candidate who is widely believed to have defeated President Nicolás Maduro in the disputed 28 July presidential election. This recognition from US President Joe Biden’s government follows similar moves from a number of Latin American countries and the European Parliament. However, it is questionable whether it will have any real impact on the political situation in Venezuela; US recognition of former opposition leader Juan Guaidó as Venezuela’s ‘interim president’ in 2019 failed to loosen Maduro’s grip on power and had little impact beyond a handful of state-controlled companies based outside of Venezuela, which fell under opposition control.

• In a brief social media post, Blinken yesterday wrote that “the Venezuelan people spoke resoundingly on 28 July and made Edmundo González the president-elect”. He added that “democracy demands respect for the will of the voters”. The US declared back in August that González won the most votes in the election, but had hitherto refrained from referring to him as “president-elect”.
• González, who since September has been living in exile in Spain, thanked the US for “recognising the sovereign will of all Venezuelans” and “honouring our people’s desire for change”. In an interview yesterday with the Colombian TV news channel NTN24, González once again said that he plans to return to Venezuela to be sworn in as president on 10 January. He said that “my inauguration will be done in line with the constitution in Venezuela, in front of the legislative bodies that are approved to carry out this inauguration”. He denied that he was planning to be ‘inaugurated’ abroad and form a government-in-exile.
• Venezuela’s Foreign Minister Yván Gil responded to Blinken’s recognition of González by declaring that the Biden administration “should, in the last days of its government, focus on reflecting on its failures, get rid of its imperial and colonial complexes, and write the memoirs of how, like its predecessors, it was forced to taste defeat by the Bolivarian Revolution [the governments of Maduro and his late predecessor Hugo Chávez (1999-2013)]”.
• On 18 November the US lower chamber of congress approved the Bolívar Act, which prohibits US federal agencies from contracting with companies and people that “have business operations with the Maduro regime”. The legislation, which now proceeds to a vote in the senate, could potentially impact US oil firm Chevron, which has a licence to operate in Venezuela despite the current sanctions.
• The president of Venezuela’s national assembly, Jorge Rodríguez, said yesterday that González and the opposition’s de-facto leader within Venezuela, María Corina Machado, should be tried for “treason”. Accusing them of supporting international sanctions on Venezuela, Rodríguez said that a new bill would be drafted in the government-controlled national assembly which would bar anyone who has supported sanctions from holding public office.

Looking Ahead: It is unclear whether the Biden administration intends to recognise González as Venezuela’s official president, as the US did with Guaidó, following the 10 January presidential inauguration date. Doing so would put pressure on President-elect Donald Trump, who takes office ten days later, to maintain that diplomatic stance. The 2019 recognition of Guaidó took place during Trump’s previous presidency (2017-2021), and Trump’s nominee for secretary of state, Marco Rubio, has long been a fierce critic of Maduro’s government.

*Bolivia’s President Luis Arce has met China’s President Xi Jinping on the sidelines of the G20 summit in Rio de Janeiro, which Arce is attending as a guest of Brazil’s government. In a social media post, Arce said that Xi “expressed his interest in financial cooperation and finance management for joint projects in different strategic areas, such as mining, lithium industrialisation, and the strengthening and expansion of the binational aerospace programme”. Arce also said that Xi expressed interest in the possibility of “a bi-oceanic train to connect the Pacific and Atlantic oceans, beginning in Peru’s Chancay mega-port and passing through BRICS partner countries like Bolivia and Brazil”. Bolivia was invited in October to become a ‘partner country’ of the BRICS bloc, which originally comprised Brazil, Russia, India, China, and South Africa before its expansion last year. Arce added that Bolivia and China “are advancing on a comprehensive strategy that will allow us to expand the Chinese market for Bolivian products, and to strengthen the bond between our ancient cultures”.

On 19 November Brazil’s federal police (PF) arrested military officers suspected of participating in a plot in 2022 that could have involved assassinating President Luiz Inácio Lula da Silva, Vice President Geraldo Alckmin, and supreme court (STF) justice Alexandre de Moraes.

Analysis:

These latest arrests mark a continuation of the PF’s investigations into possible anti-democratic acts, such as an alleged conspiracy by allies of far-right former president Jair Bolsonaro (2019-2023) to launch a military coup and overturn his 2022 election defeat. Under his presidency, Bolsonaro sought to expand the military’s influence in civilian government, and it has long been suspected that Brazil’s armed forces had personnel with radical right-wing sympathies among its ranks. Although Bolsonaro himself has not been implicated in this alleged plot, the PF probe could pile more pressure on his inner circle. Police suspect that some Bolsonaro allies might have been aware of the plans, such as his former aide-de-camp, Lieutenant-colonel Mauro Cid, and his former chief of staff (2020-2021), defence minister (2021-2022), and running mate in the 2022 presidential race, General Walter Braga Netto.

• The army officers arrested yesterday were Brigadier General Mário Fernandes, Majors Rodrigo Bezerra de Azevedo and Rafael Martins de Oliveira, and Lieutenant-colonel Hélio Ferreira Lima. The PF also arrested a member from its own ranks, Wladimir Matos Soares, who is suspected of providing the army officers with information about Lula’s security detail.
• Among this list of detained suspects, national media reports highlight that Fernandes has the closest ties to the previous Bolsonaro administration, having served as a presidential secretary from 2021-2023.
• Police investigators believe that Ferreira Lima and Martins de Oliveira held a meeting at Braga Netto’s home in November 2022, in which the plot could have been discussed. The PF also found exchanges of messages via messaging apps between Cid and some of the officers which suggested they were planning the logistics for some kind of operation, with aliases and codewords based on countries competing in the 2022 football World Cup.
• The police believes that, in their messages, the officers were discussing the possibility of using explosives or poison to execute De Moraes, while the alleged plan to kill Lula could have involved poisoning him during one of his frequent hospital appointments.

Looking Ahead: Cid was questioned again by PF investigators, who are reportedly in the final stage of their probe into the alleged military coup conspiracy.

*Brazil’s lower chamber of congress has approved a bill (PL 182/2024) proposing a regulatory framework for the trading of carbon credits. The legislation was approved by the senate last week and has been submitted to the president’s office to be promulgated into law. According to the terms of the bill, Brazil’s regulated carbon market, known as the ‘Sistema Brasileiro de Comércio de Emissões de Gases de Efeito Estufa’ (SBCE), will be gradually implemented over the course of six years. The SBCE platform will be used for the negotiation of carbon emission quotas and for certification to verify the reduction of carbon emissions. A company must register on the SBCE any activity or initiative that emits over 10,000 tonnes of carbon dioxide equivalent (tCO2e) per year. Given the influence of the farming sector lobby in Brazil’s congress, the bill would exempt agribusiness companies from the SBCE.

On 19 November Lionel Lazarre, deputy spokesperson for Haiti’s police (PNd’H), told the media that at least 28 suspected gang members had been killed by PNd’H officials and residents in Pétion-Ville, a wealthy Port-au-Prince suburb.

Analysis:

The violence followed threats by prominent gang leader Jimmy ‘Barbecue’ Chérizier, who heads up the Viv Ansanm united front of gangs, reportedly made in video clips posted on social media, to attack Pétion-Ville. The Miami Herald cites him as threatening to target hotels in the area “habouring politicians”. The Herald and other media also cite Chérizier as calling for the resignation of the transitional presidential council (TPC), which was established in April following Viv Ansanm’s unprecedented attacks in February, which ejected former prime minister Ariel Henry (2021-2024). The violence again illustrates the uphill battle facing authorities in their struggle to regain control of Port-au-Prince (of which 85% is estimated to be controlled by gangs), and the limits of the multinational security support mission (MSS) to Haiti, the first deployment of which arrived in June. It comes amid other signs of escalating violence that saw the capital’s main airport recently shuttered after aircraft were hit by bullets, and amid political turbulence at the top after the TPC recently ejected Henry’s interim replacement Garry Conille, replacing him with Alix Didier Fils Aimé.

• According to press reports, the Pétion-Ville violence began when two trucks transporting suspected gang members entered the suburb. According to the same reports, residents teamed up with the PNd’H to repel the suspected gang members, in what is the latest sign of the so-called ‘Bwa Kale’ vigilante movement which emerged in May 2023.
• Also yesterday, international NGO Médecins Sans Frontières (MSF), which has been in Haiti for over 30 years, announced it was suspending activities in Port-au-Prince until further notice, citing a “series of threats by police forces against MSF staff”.
• Yesterday United Nations (UN) Secretary-General António Guterres issued a statement expressing alarm regarding the escalating violence, reiterating his “pressing call” to ensure the MSS “receives the financial and logistical support it needs to successfully implement its mandate”.  

Looking Ahead: Guterres’ call comes as the UN Security Council (UNSC) is reportedly due to discuss today (20 November) whether to transform the MSS into a formal UN peacekeeping operation. The proposal, which would unlock more resources, was previously floated within the UNSC but rejected by Russia and China. The escalating violence could force the UNSC to reconsider.

*Suriname’s finance minister, Stanley Raghoebarsing, has announced a debt rescheduling agreement with China with the media reporting that the first repayments would come this year. Suriname owes China’s Export-Import Bank (Exim), a state-owned bank, some US$476m, of which US$140m is in arrears, according to debt management office data from mid-2024 cited by Reuters. Malty Dwarkasing, the head of the debt management office, also told Reuters that payments to Exim would be rescheduled in two phases, with Suriname’s debt to the Industrial and Commercial Bank of China (ICBC), a state-owned banking and financial services company, to be repaid in one tranche. Suriname owed US$68m to the ICBC as of end June, according to the same Reuters report. The announcement follows a visit to China in April by Suriname’s President Chandrikapersad Santokhi who met his Chinese counterpart Xi Jinping. The announcement regarding the agreement with China follows an agreement reached on 8 October by the group of creditor countries under the Paris Club on the conditions of the second phase of the restructuring of Suriname’s external public debt; in June 2022 they had similarly rescheduled some of Suriname’s payments. According to the Paris Club, the total stock of Suriname’s external debt was estimated to be US$2.69bn, as of 31 December 2023, and the stock of debt owed to Paris Club creditors was estimated to be US$88m.

On 19 November a commission of Mexico’s lower chamber of congress unanimously approved a planned reform of Article 21 of the constitution, designed to increase the powers of the security ministry (SSPC).

Analysis:

The constitutional amendment is now expected to be given fast-track congressional discussion and approval. It increases the powers and coordinating role of the security minister, a post held by Omar García Harfuch, regarded as President Claudia Sheinbaum’s right hand man. The two worked closely together, achieving a reduction of the homicide rate, when Sheinbaum was the head of government of Mexico City (CDMX) (2018-2023) with Harfuch as her head of security: the intention seems to be to reproduce that formula at national level. A recent wave of criminal violence in states like Guerrero, Querétaro, Guanajuato, and Sinaloa has added a sense of urgency.

• The planned reform gives SSPC the power to coordinate the security activities of the three branches of government who are all required to share information.
• SSPC is to take direct control of the national intelligence service and will be empowered to investigate crimes alongside state and federal prosecutors, police forces, and the national guard (GN).
• The SSPC will also be authorised to “monitor and audit” resources paid to states and municipalities to strengthen their police forces
• In parallel with these changes the SSPC is also undergoing an internal reform process, with the creation of three new deputy roles, including a deputy minister for investigation and police intelligence, a position that has gone to Héctor Elizalde, another key figure in Sheinbaum’s time in charge of CDMX.
• It was Elizalde who stood in for Harfuch in June 2020 when the latter was seriously injured in an assassination attempt attributed to the Cártel Jalisco Nueva Generación (CJNG).   

Looking Ahead: With both the ruling left-wing Movimiento Regeneración Nacional (Morena) and opposition parties in congress in broad agreement, the Article 21 amendments are likely to be approved before the end of this year. That said, the current wave of cartel violence will put political pressure on the new government to show an improvement in security.  

*International credit ratings agency Moody’s has reduced its GDP growth forecast for Mexico to 1.5% for 2024 and 1.3% for 2025, down from mid-year estimates of 2.4% and 1.5% respectively, as widely reported in the media. According to excerpts of the report, circulated in the local media, Moody’s expects a “deceleration in Mexico driven by high interest rates”. It also cites expected disruption caused by US President-elect Donald Trump’s return to office in January which could result in “new tariffs and trade restrictions in the US, as well as tax cuts that would imply a deterioration in debt dynamics [and] an increase in inflation and interest rates”. This follows Moody’s recent decision to lower its credit outlook for Mexico from stable to negative, citing the controversial judicial reform, among other factors.

On 19 November a Santiago court judge ordered that Chile’s former deputy interior minister Manuel Monsalve be held in preventive detention on charges of rape, setting a four-month deadline for the case against him to be finalised.

Analysis:

The Monsalve scandal continues to erode the popularity of the government led by President Gabriel Boric. News of the court ruling against Monsalve came late on 19 November, only hours after Boric had returned to the country following a six-day tour that took him to the Asia-Pacific Economic Cooperation (Apec) forum and G20 summits respectively, in Lima and Rio de Janeiro. Media coverage of the case overshadowed Boric’s diplomatic activity, with some newspapers describing it as the “darkest day” of his presidency (he took office in March 2022).   

• Monsalve, who as deputy interior minister had been one of the most popular government officials with responsibility for security and the battle against crime, was forced to resign on 17 October and was arrested on 14 November after a junior colleague accused him of raping her in a Santiago hotel following a night of heavy drinking.
• In a blow to the government Judge Mario Cayul ruled that the man who had been regarded as the administration’s top security czar could not be released on bail because he was a potential threat to society in general and to his alleged victim in particular.
• Monsalve attended the 13-hour court hearing in handcuffs. His lawyers said he would appeal against the preventive detention decision. If found guilty, he faces a potential prison sentence of up to 15 years.
• Details of the case continue to pose awkward questions about President Boric’s political judgement. The most important remains the 48-hour gap between the point at which Boric was informed of the rape accusation and the point at which he acted to ensure that Monsalve was removed from office.

Looking Ahead: The Monsalve case is set to pose further embarrassment for the government as the lower chamber of congress has set up a 13-strong investigating commission, of which a majority (seven) are members of the opposition.

*Argentina’s President Javier Milei has held his first meeting with China’s President Xi Jinping on the sidelines of the G20 summit in Brazil. The meeting drew particular attention given Milei’s earlier rhetoric on the campaign trail last year about China, calling the Chinese government “murderers” and insisting he would make “no deals with communists”. Yet the two leaders yesterday discussed their countries’ “current trade and financial ties” and “desire to continue exploring new opportunities to expand and improve,” according to a statement by Argentina’s presidency widely circulated in the local press – indicative of what has become a pragmatic collaboration which reflects China’s desire to expand influence in the region, and Argentina’s economic needs. For instance, bilateral trade volume exceeded US$17bn last year, with China being Argentina’s second-largest trading partner, according to a report published by China Daily, a newspaper owned by China’s ruling Communist party. Meanwhile earlier this year, Chinese authorities renewed a US$5bn currency swap agreement until 2026. A statement by China’s foreign ministry following the Milei-Xi meeting highlights that this year marks the 10^th anniversary of the establishment of the China-Argentina comprehensive strategic partnership. It adds that China “is ready to work with Argentina to promote the long-term and stable development of the China-Argentina comprehensive strategic partnership.” It also states that China is ready to work with Argentina to continue promoting cooperation regarding its ‘Belt and Road Initiative’ (BRI), China’s flagship global infrastructure investment initiative, and “deepen cooperation in energy and mining, infrastructure, agriculture, scientific and technological innovation, digital economy and other fields” as well as continuing to carry out “financial cooperation with Argentina and help Argentina maintain economic and financial stability”.