LatinNews Daily - 10 August 2020

On 9 August “a national political dialogue” called the previous day by Bolivia’s interim president Jeanine Áñez in an attempt to end a week of nationwide roadblocks, erected in protest at the latest postponement of the country’s general election, failed to get off the ground.

Analysis:

Áñez was rebuffed in no uncertain terms. Representatives of the main workers’ union Central Obrera Boliviana (COB), which launched the latest protests in response to a resolution in late July by the supreme electoral tribunal (TSE) to push back the general election from 6 September to 18 October, the main presidential contenders, and the presidents of the lower chamber of the legislative assembly, Sergio Choque, and senate, Eva Copa, respectively all declined her invitation. The only attendees were candidates for smaller parties with no chance of winning, the president of the TSE, Salvador Romero, and representatives of the United Nations (UN), European Union (EU) and Catholic Church overseeing dialogue.

• The talks lasted three-and-a-half hours with no substantive agreements because the key players were not present. Opposing groups reject the interim government’s argument that postponing the elections is essential because of a sharp increase in confirmed cases of coronavirus (Covid-19), arguing that the interim goverment has already outstayed its welcome and, if anything, a legitimate, democratically elected, government is more essential than ever in order to address the twin health and economic crises associated with the pandemic.
• Áñez antagonised opponents by suggesting that the purpose of the talks was to confirm the TSE’s new date for the elections and to lift the roadblocks, which she claimed were “preventing oxygen from reaching Covid-19 patients”. The COB leader, Juan Carlos Huarachi, was adamant that “the proposal has been clear and concrete – elections on 6 September”. He argued that, if they were delayed further, the TSE and the interim government would be “wholly responsible for anything that happens”.
• Áñez insisted that the delay of the elections had not been “on a whim” but was “a necessity” in the face of the pandemic. The minister of the presidency, Yerko Núñez, did nothing to defuse tensions, accusing the protesters of having ulterior motives. “Before the Bolivian people and the international community”, Núñez said, “the protest leaders behind these inhumane and criminal measures are dishonest [about their true intentions]”.
• The interim government has denounced the protesters before the Organization of American States (OAS), claiming they are responsible for at least 31 fatalities from a lack of oxygen as a result of the 70-odd roadblocks around the country concentrated in the departments of Cochabamba, Oruro, La Paz, and Potosí. Organisers of the protests insist that they have been letting through vehicles carrying medical supplies and oxygen and accuse the interim government of seeking to deflect blame for its own inadequate handling of the pandemic. But they risk losing public support for their cause if people feel the protests are jeopardising the lives of those seriously ill from Covid-19.

Looking Ahead: Núñez said the government will form a commission today (10 August) to explore a dialogue with all political and social sectors.

* According to a survey by Ecuador’s national statistics institute (Inec), conducted from May to June, there were over 1m unemployed people in the ocuntry during this period, accounting for 13.3% of the economically active population of 7.6m people. The survey interviewed 10,397 households across the country. In contrast, in June 2019, 4.4% of the economically active were unemployed while in December 2019, this figure had dropped to 3.8%.

On 8 August, the death toll from the coronavirus (Covid-19) in Brazil passed 100,000, while the number of confirmed cases topped 3m, according to official figures.

Analysis:

Brazil is the second country in the world to reach this mark, after the US. Pre-empting this grim milestone during his weekly Facebook Live on 6 August, President Jair Bolsonaro had said, “we will reach 100,000 [deaths], but we’ll get on with life and do away with this problem”. This encapsulates Bolsonaro’s cavalier attitude towards the coronavirus, an attitude which has informed the federal government’s chaotic response to the pandemic, and which many hold directly responsible for the severity of the uncontrolled coronavirus epidemic in Brazil.

• With numbers recorded yesterday (9 August), confirmed cases now top 3.035m, while fatalities have reached 101,049 according to the federal health ministry – which has been led by an interim minister with no previous experience in public health since 15 May.
• Congress and the supreme court (STF) declared official mourning of four and three days, respectively, while national papers marked the tragic milestone with front pages paying tribute to the dead.
• Bolsonaro did not comment on the number of fatalities until yesterday, when he posted a thread on Twitter in which he said “we lament every death, whatever the cause”, suggesting that there have been two deaths due to lockdown measures for every three Covid-19 fatalities, and evoking the deaths of three police officers in a shootout in São Paulo state.
• Bolsonaro also condemned the media, notably TV Globo (although he didn’t name the channel), for “spreading panic”. TV Globo had overtly criticised Bolsonaro during its prime time evening news programme on 8 August.

Looking Ahead: Although Bolsonaro has been fiercely criticised for his response to the pandemic, polls show that public opinion has not shifted much in recent weeks and his support remains steady. This seems to reinforce the view of scientists and health experts who worry that the pandemic has become normalised in the country, making it harder to encourage and enforce containment measures which should help slow the spread of the virus.

* Brazil’s national statistics institute (Ibge) has released the latest figures for the consumer price index (IPCA), according to which monthly inflation grew 0.36% in July (the highest figure for the month since 2016). This brings the annual inflation rate to 2.31%. The Ibge notes that an increase in transport prices, due notably to a 3.42% increase in the price of petrol, has driven July inflation. The central bank’s (BCB) monetary policy committee (Copom) currently expects inflation to close the year at around 1.9%. 

On 9 August El Salvador’s President Nayib Bukele announced that the first phase of economic reopening would be extended until 23 August.

Analysis: 

Bukele’s announcement follows a ruling two days earlier by the constitutional chamber of the supreme court (SC), which declared unconstitutional an executive decree (32) aimed at regulating the reopening of the economy, shut down as part of efforts to stop the spread of coronavirus (Covid-19). The SC, which has previously ruled against other executive decrees relating to the government’s pandemic response, argued the decree should have been approved by the legislature as it limits citizens’ rights such as freedom of movement and economic freedoms. The latest setback to efforts to reopen the economy, which the United Nations Economic Commission for Latin America and the Caribbean (Eclac) forecasts will shrink by 8.6% in 2020, the largest predicted contraction in Central America, reflects the ongoing stand-off between the opposition-controlled legislature and the executive over government transparency.

• Issued on 29 July, the executive decree had set out a new calendar for the country’s gradual economic reopening. The first phase had already begun on 16 June, with sectors considered key to the economy such as textiles, manufacturing, and construction able to return to work. The second phase was due to begin on 20 August, and involved reopening public transport among other sectors. The third, fourth, and fifth phases were due to begin on 4 September, 19 September, and 4 October. 
• The SC ruling also urges the executive and the legislature, which is controlled by the opposition Frente Farabundo Martí para la Liberación Nacional (FMLN) and Alianza Republicana Nacionalista (Arena), to reach an agreement regarding legal norms which would permit the government to better address the health emergency.  

Looking Ahead: With uncertainty as to whether the executive and legislature will reach an agreement before 23 August, private sector representatives such as Silvia Cuéllar, the executive director of export lobby Corporación de Exportadores de El Salvador (Coexport), continue to raise concerns about the lack of a clear framework for economic reactivation and its impact on sectors such as trade. The latest central bank (BCR) figures show El Salvador’s exports in the first half of 2020 totalled US$2.2bn, down 27.6% on the same period in 2019.

* Due to a spike in coronavirus (Covid-19) cases in Havana province, where Cuba's eponymous capital is located, and the bordering Artemisa province, the Cuban government has reintroduced restrictions in the capital and the Bauta municipality in Artemisa, suspending public transport and closing bars, cinemas, beaches and parks. On 8 August Cuba’s health minister, José Angel Portal Miranda, explained that from 21 July onwards, Cuba has seen a rise in daily Covid-19 cases, after the country began a three-phase reopening plan in June. On 8 August, Cuba registered 65 new daily confirmed cases, bringing to the total to 2,953. According to government figures, 151 and 183 new cases were confirmed in weeks 31 and 32, up from 49 and 20 in weeks 30 and 29. Portal Miranda warned that Havana province is in a “stage of exponential growth” of the disease, adding that new “cases appear every day”. 

On 7 August Mexico’s President Andrés Manuel López Obrador dismissed adjusting the national strategy to address the coronavirus (Covid-19) pandemic, insisting that his government has adequately handled the public health emergency. 

Analysis:

Mexico has the world’s third highest Covid-19 death toll, with the number of deaths and infections still rising. There have been growing calls by political leaders for a change in strategy to bring the epidemic under control. López Obrador’s stubborn defence of his government’s strategy despite the high death toll and refusal to contemplate alternatives to try to save more lives is becoming the main source of political tension in the country.

• After Mexico’s death toll overtook that of the United Kingdom last week, a group of opposition governors called for a review of the federal government’s Covid-19 strategy. They argue that the strategy has clearly failed to limit the number of preventable deaths. Meanwhile the main opposition Partido Acción Nacional (PAN) accused López Obrador of being “criminally complicit” in the deaths of thousands of people by pursuing a flawed strategy.
• Mexico’s death toll exceeded 50,000 on 6 August but the following day López Obrador once again defended his government’s handling of the pandemic and rejected the need for changes. He said that Mexico has succeeded in flattening the infection curve and strengthening its health system, which prevented hospitals from becoming saturated with Covid-19 patients.
• López Obrador lamented the high number of deaths but emphasised that nobody failed to receive medical treatment. He attributed the elevated death toll to the high incidence of health problems such as obesity and hypertension amongst Mexicans and noted that Mexico’s death rate per 1m inhabitants is lower than in the United Kingdom, Peru, Spain, Italy, Chile, the US, Brazil, and France. “We have not been hit as hard”, López Obrador argued, insisting that the strategy is working.

Looking Ahead: Indicative of the growing public discontent over the government’s pandemic response, demonstrators yesterday (9 August) displayed an enormous black ribbon in Mexico City’s central Zócalo square to “commemorate the death of the more than 50,000 people killed by the federal government’s mishandling of the pandemic”.  

* Mexico’s national statistics institute (Inegi) has released consumer price index figures for July, which show that monthly inflation was 0.66%, and the annual inflation rate was 3.62%. This is up from annual inflation rates of 3.33% in June and 2.15% in April. In July 2019, Inegi had reported 0.38% monthly inflation and an annual rate of 3.78%. July marked the second month of the so-called “new normal”in Mexico, a term the government uses to describe the gradual reopening of businesses, restaurants, hotels and other industry across most regions of the country, previously closed in a bid to contain the spread of coronavirus (Covid-19). Mexico’s inflation target set by the central bank (Banxico) is 3%.

On 9 August, Paraguay’s Finance Minister Benigno López said that it would be “catastrophic” from an economic point of view to reimpose a lockdown in the country’s capital Asunción and neighbouring Central department.

Analysis:

López expressed this view as the health authorities in the government led by President Mario Abdo Benítez are becoming increasingly worried by a surge in coronavirus (Covid-19) cases and deaths, and are mooting delaying or even rolling back economic reactivation measures in parts of the country in a bid to slow the infection curve and avert a public health crisis. A division in government now appears to be emerging, between those who maintain that containment measures are necessary to save lives, and those who argue that their economic toll is too heavy a price to pay.

• López was speaking about the government’s economic reactivation plan on national television ABC TV yesterday when he was asked whether the government had considered what a return to lockdown in Asunción and the Central department might imply from an economic point of view. “This [a lockdown] would be catastrophic, it would be very difficult and would deliver an almost definitive blow to our forecasts for this year”, López replied. 
• Asunción, Central, and the Alto Paraná department which borders Brazil are currently in ‘phase 3’ of the government’s ‘intelligent quarantine’ reactivation plan, while the rest of the country is in ‘phase 4’.
• In a press conference on 7 August, Health Minister Julio Mazzoleni said he had recommended to President Abdo Benítez that these three areas remain in ‘phase 3’ until 30 August. Mazzoleni also said that the country is entering “the most difficult stage of the pandemic”.
• As of yesterday, Paraguay had 6,907 confirmed cases of Covid-19 of which 75 deaths. The number of cases has risen by almost 262% in a month, while fatalities more than doubled in this period. Asunción, Central, and Alto Paraná have concentrated 90% of cases recorded in the last three weeks.

Looking Ahead: Covid-19 figures in Paraguay remain low in absolute terms, but as Guillermo Sequera, a health ministry official, has noted, the country’s healthcare system is still not equipped to deal with a large outbreak, hence the focus on prevention and containment measures to avoid a collapse in the healthcare system.

* Figures from Chile’s national customs service show that in the first seven months of 2020, Chile’s trade balance was down 14.1% compared with the same period in 2019, to a total US$68.66bn – a slump indicative of the ongoing impact of the coronavirus (Covid-19) pandemic on global trade. The figures show that Chile’s exports were US$39.6bn in the same period, down 10% compared with the same period in 2019, while imports reached US$31.2bn, down 18.1%. In the first seven months of 2020, China remained Chile’s main export market, accounting for 35.8% of exports followed by the US (14.3%) and Japan (9%). 

Peru: On 31 July Peru’s foreign ministry released a statement denouncing as inaccurate the report by the US Office of National Drug Control Policy (ONDCP), a component of the Executive Office of the US President, on coca cultivation and production in Peru, published on the same day. The ONDCP report claims that coca cultivation expanded in Peru by 38% between 2018 and 2019, with potential pure cocaine production rising by 40%. According to Peru’s foreign ministry, the ONDCP report ignores the fact that 9,079 hectares (ha) of coca plantations in Peru are dedicated to the traditional cultivation of coca leaves used by the people in the Andes to ease altitude sickness; and to the industrial production of legal coca derivative products such as sweets and coca tea. Meanwhile the head of Peru’s national anti-drugs agency (Devida), Rubén Vargas Céspedes, has highlighted that the ONDCP also did not take into account the 18,000ha of illegal coca plantations eradicated by the Peruvian government over the course of 2019. Devida calculates that there were 53,000ha of illegal coca plantations in 2019, which could produce up to 306 metric tonnes (t) of cocaine, much lower than the 72,000ha and 705t calculated by the ONDCP. Vargas noted that these oversights were flagged up to the ONDCP on 24 and 27 July, but the ONDCP did not correct them in the final report. Devida is due to release its own illegal coca cultivation monitoring report, produced in with collaboration with the United Nations and the European Union, in October.   

Brazil: In a 29 July interview with Brazilian daily, O Globo, the US ambassador to Brazil Todd Chapman warned of possible “consequences” if the government led by President Jair Bolsonaro contracts the Chinese telecommunications company, Huawei, to build Brazil’s ‘5G’ cellular telecoms network. Chapman highlighted that preventing this is a “matter of national security”, as Huawei could hand over confidential information from the users of the network to the Chinese government. Chapman warned that contracting Huawei could compromise future investments in Brazil by US businesses in areas such as pharmaceuticals and software, due to the fear that intellectual property rights could be violated by the Chinese firm. Chapman added that Brazil must safeguard its intellectual property or the country will “continue to export primary and low-tech products”. According to O Globo, on 3 August Brazil’s Vice President Hamilton Mourão defended the inclusion of Huawei in the 5G bidding process during a videoconference with foreign journalists. Mourão noted that “Huawei has capacity above its competitors and we do not yet see US companies capable of defeating international competition”, adding that over a third of Brazil’s current ‘4G’ telecoms network is used by operators who use Huawei equipment. Meanwhile Leonardo Euler, the president of Brazil’s national telecommunications agency (Anatel), confirmed on 3 July that the tender process for firms interested in bidding for Brazil’s 5G network construction contract is scheduled for 2021.

Guatemala: On 22 July a group of prominent Guatemalans, including former president, Rafael Espada (2008-2012), and entrepreneur, Luis von Ahn, founder of language learning app Duolingo, sent a letter to the Speaker of the US House of Representatives Nancy Pelosi in which they expressed their deep concern over “the entrenchment of organised crime in our country’s democratic institutions and the serious risk that these forces will achieve absolute control of the highest courts of the land”. Calling for the US State Department and other US government agencies to “restore a strong bipartisan policy towards Guatemala and Central America”, the letter explains that “following the expulsion of the International Commission against Impunity in Guatemala, criminal groups have regained control of a large number of high courts. These groups also exert strong influence over a majority of members of congress… The alarming penetration of corruption and organised crime into our most important institutions puts Guatemalan democracy at risk and makes our country a source of insecurity to its neighbours”. It adds that this “would exacerbate the existing factors that lead people to leave Guatemala". The letter also deplores the current apparent lack of cross-party political support in the US for strengthening democracy in Guatemala. “Since 1986, the bipartisan policy of the US has been to support political stability. When bipartisan support for this goal weakens, as it has in the last year, the Guatemalan democratic system is destabilised”, the letter concludes.

Mexico: On 6 August, the US State Department announced that it was maintaining its maximum ‘Level 4: Do Not Travel’ health advisory status for Mexico, while lifting it for global travel. The State Department first issued the warning on 19 March for all international travel due to the spread of the coronavirus (Covid-19) but has now returned to its previous country-specific system as conditions in some countries have improved. But with the epidemiological situation in Mexico still seemingly not under control, with the country reporting over 470,000 cases and daily infection rates still rising, the State Department has not removed the travel warning to one of the top destinations for US tourists. Travelers to Mexico are warned they might experience border closures, airport closures, travel prohibitions, stay-at-home orders, business closures and other emergency conditions due to the pandemic. The State Department also urges US nationals to exercise increased caution in Mexico due to crime and kidnapping, highlighting that there is an increased risk of this in some states, namely Colima, Guerrero, Michoacán, Sinaloa and Tamaulipas.