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LatinNews Daily - 03 June 2021

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Main Briefing

On 2 June a court order was made public, which excludes high-profile Nicaraguan opposition presidential pre-candidate, Cristiana Chamorro Barrios, from taking part in the 7 November general election.

Analysis:

The order against Chamorro, dated 1 June, is in relation to alleged money laundering and other crimes. Chamorro, who yesterday was also placed under house arrest, has rejected the charges as trumped up and says she is being politically persecuted. The daughter of former president, Violeta Chamorro (1990-1997), Chamorro Barrios is believed to be among the most popular opposition rivals to President Daniel Ortega, who is seeking a further term for the ruling Frente Sandinista de Liberación Nacional (FSLN) in the November election. Her arrest and exclusion from the election has been widely condemned by the international community and follows other signs that the Ortega government wants to undermine the electoral process. These include the recent decision by the electoral authorities (CSE) to strip two opposition parties of their legal status; and contentious electoral reforms and appointment of the new CSE. All of this is piling the pressure on Organization of American States (OAS) Secretary General Luis Almagro to make good last year’s threat to request that OAS members declare a “rupture of the democratic order” in Nicaragua, which could result in the suspension or termination of its member state status.

  • According to Chamorro Barrios' brother, Carlos, a well-known opposition journalist whose offices have also been targeted by the national police (PNN), Chamorro Barrios' home in the capital, Managua, was raided and remains under police occupation.
  • Indicative of international condemnation, the OAS yesterday issued a statement rejecting “the process of disqualification” of Chamorro Barrios' candidacy. It warned that “Nicaragua is heading for the worst possible elections, and this new attack on democracy verified yesterday makes it even more impossible to have free, fair and transparent elections in the country. Actions like this remove all political credibility from the government and the organisers of the electoral process”.
  • The OAS adds that “The use of the Prosecutor’s Office, injunctions and precautionary measures, the politicised handling of justice and the de facto banning of candidates are in violation of the Inter-American Democratic Charter, the OAS Charter, the instruments on human rights and of international pacts to which Nicaragua is a party”.
  • US Secretary of State Antony Blinken also slammed the move, tweeting that preventing Chamorro Barrios from competing in the election “reflects Ortega’s fear of free and fair elections”. In an interview with Costa Rican daily, La Nación, Blinken also warned Nicaragua was moving in the “opposite direction” to guaranteeing “free and fair elections”. Blinken made his comments during a two-day visit to Costa Rica to discuss US strategy with regard to Central America and, in particular, addressing root causes of migration. Following a meeting with Central American and Mexican foreign ministers, he underlined “the need for commitment from all leaders to free and fair elections”.

Looking Ahead: With members of the international community such as the US and European Union (EU) having previously sanctioned the Ortega government and its allies over democracy-related concerns, the latest electoral developments are fanning demands for action from the OAS. Yesterday Coalición Nacional (CN), one of the two main opposition groupings in Nicaragua, issued a statement calling on the OAS to declare a “rupture of the democratic order” in Nicaragua. It cited the failure by the government to pass electoral reforms “in line with international standards” by 31 May; an OAS October 2020 resolution on Nicaragua had called for these to be in place “no later than May 2021”.

Andean

On 2 June, Venezuela’s foreign ministry rejected Colombia’s “unilateral” decision to reopen border crossings between the two countries.

Analysis:

The Colombia-Venezuela border has been closed since March 2020 to limit the spread of the coronavirus (Covid-19), and any coordinated attempts to reopen it will be complicated by the severing of diplomatic relations between the two countries in February 2019. Reopening the border is seen as paramount by many Venezuelans who rely on travel to Colombia to obtain supplies, and who have been exposed to extortion when travelling via unofficial border crossings.

  • Venezuela’s foreign ministry criticised Colombia’s “unilateral” decision to open the border, accusing its counterparts of seeking to distract from “ongoing human rights violations” against anti-government protesters in Colombia. Expressing concern that the reopening could intensify Venezuela’s coronavirus epidemic, the foreign ministry called for an “advance in bilateral coordination in security, trade, and health measures, which could eventually lead to a reopening of border crossings that is agreed upon by both countries”.
  • This followed an announcement by Colombia’s interior ministry on 1 June, which ordered the opening of border crossings on the Colombian side from 2 June. Colombia’s migration authorities later announced that entry to the country would be restricted, with those whose identification document ends in odd and even numbers allowed to enter on consecutive days.
  • Venezuela’s de facto government has come under criticism from the political opposition for not reciprocating the border opening on the Venezuelan side. Former national deputy Karim Vera, who lost her seat for Primero Justicia in the national assembly after boycotting the December 2020 legislative elections, said that Venezuela’s migration authorities are taking bribes to allow travellers to cross the border via unofficial routes.
  • Venezuela’s refusal to open its side of the border was also criticised by Javier Tarazona, the director of Venezuelan NGO Fundaredes, who said that preventing people from crossing the border was a “criminal act” given that “thousands of people need to buy medicines, food, and basic products that can’t be found in the country”, and that those crossing illegally are being extorted by criminal groups.

Looking Ahead: Venezuela has given no indication of a timeframe for opening its side of the border. In reality, border crossings are likely to resume apace, with travellers registering on the Colombian side and illegally entering and exiting Venezuela.

* Ecuador’s attorney general, Íñigo Salvador Crespo, has set out a timeline for the government to transfer US$374.3m to the French oil company Perenco, which he said would be completed within 60 days. The payment relates to a 1 June ruling by the World Bank’s International Centre for Settlement of Investment Disputes (ICSID), which ordered the state to compensate Perenco for a 2007 decree by former president, Rafael Correa (2007-2017), that increased state control of oil surpluses from 50% to 99%. Following the ICSID’s decision, President Guillermo Lasso said that “the Ecuadorean state will respect and honour its international commitments”. Lasso’s acceptance of the compensation payments demonstrates a change of course from the legal challenges mounted by his predecessor, Lenín Moreno (2017-2021), and will be intended to demonstrate his government’s respect for international court rulings and regain investor confidence.

Brazil

On 2 June, Brazil’s President Jair Bolsonaro delivered a televised address in which he outlined his government’s supposed achievements, notably on the economic front.

Analysis:

Bolsonaro’s speech comes at a time of political weakness, as his government’s mishandling of the coronavirus (Covid-19) pandemic is being subjected to scrutiny in a commission of parliamentary inquiry (CPI) in the senate, and public discontent has recently translated into street protests. The national address was seemingly an attempt to make the most of the economy’s strong performance to win back some public support. 

  • In the short, five-minute speech, Bolsonaro focused on the economic measures taken by his government to help Brazilians and small businesses during the pandemic, and listed its achievements, namely a series of small economic reforms passed by congress and infrastructure projects. He evoked the recently released Q1 GDP figures, which showed unexpectedly strong growth, and claimed that Brazil’s economy will grow 4% this year (the government’s official projection currently stands at 3.5%).
  • “Our government did not oblige anyone to stay at home,” Bolsonaro said in an implicit criticism of the restrictions adopted by many local governments in a bid to contain the spread of Covid-19. He also hailed the vaccination process, saying that all Brazilians “who wish so” will be vaccinated by the end of the year and claiming that Brazil is “the fourth country that most vaccinates in the world”. While this is true in absolute terms, some 22% of the Brazilian population has received at least one jab, leaving it far behind rich countries and neighbours Chile (56%) and Uruguay (53%) for example.
  • Bolsonaro began his speech by lamenting “every life lost in our country”, but did not otherwise evoke the pandemic’s death toll and the persistent public health crisis. Brazil recorded 95,601 new Covid-19 cases yesterday, the highest daily figure since March, and 2,507 deaths, bringing the total to 16.7m cumulative cases and 467,706 fatalities.    

Looking Ahead: Bolsonaro’s speech was met by ‘panelaços’ (pots-and-pans protests) in at least a dozen major cities across the country, suggesting that rejection of the president remains strong and is likely to persist if warnings of a third Covid-19 wave prove to be true.

* Brazil’s national statistics institute (Ibge) has released the latest figures on the industrial sector, which show that industrial production shrank 1.3% in April compared with March. This is the third monthly contraction in industrial production, and brings production levels back below pre-coronavirus (Covid-19) pandemic levels. The Ibge’s André Macedo notes that growth in industrial production had already been slowing since the second half of last year. “With the start of 2021, the resurgence of the pandemic, and all the effects that this brings, the industrial sector showed a very evident decrease in its production pace. This is clear not only from the negative results, but also from the greater spread [across different activities] of this rate of decline,” Macedo said. In year-on-year terms, industrial production grew 34.7% compared with April 2020, when the partial shutdown of the economy due to the pandemic led to the biggest fall in industrial production on record. 

Central America & Caribbean

* Panama’s national statistics institute (Inec) has released figures which show that the country’s monthly indicator of economic activity (Imae) posted a 6.03% year-on-year contraction in March. Inec says that this reflects the continued effects of the coronavirus (Covid-19) pandemic. However, it cites as sectors which posted a good performance: exploitation of mines, fishing, private health services, and public administration. Panama’s GDP contracted by 17.9% in 2020. The International Monetary Fund (IMF) last month forecast that Panama’s economy will grow 12% in 2021 as “economic activities recover, boosted by the vaccination rollout and full-scale copper production, a recovery in private investment, and a large carryover effect”. Over the medium term, growth is expected to stabilise at its potential growth rate of 5%.

Mexico

On 2 June Mexico’s President Andrés Manuel López Obrador again accused the US government of financing local organisations that he says are opposed to his government.

Analysis:

The López Obrador government has already sent a formal diplomatic protest note to the US complaining about this and demanding an explanation, which has yet to receive any response. By raising the issue again López Obrador may be trying to shore up support for the ruling Movimiento Regeneración Nacional (Morena) party ahead of the 6 June midterm federal legislative, state, and municipal elections. But coming just days ahead of an official visit by US Vice President Kamala Harris to Mexico, the accusations could become a source of diplomatic tensions and raise US concerns about democracy in Mexico.

  • López Obrador has complained that the US Agency for International Development (USAID) provides funding for civil society organisations such as anti-corruption NGO Mexicanos contra la Corrupción y la Impunidad (MCCI), which are critical of his government. López Obrador says that the likes of MCCI are run by his political opponents and their aim is to destabilise his government.
  • López Obrador argues that by financing these organisations the US government is meddling in Mexican political affairs. Claiming that this is a violation of Mexico’s sovereignty, López Obrador has demanded a full explanation and for the funding to be stopped. López Obrador touched on the issue again yesterday in his morning press briefing.
  • Confirming that his government has yet to receive an official response for the protest note, López Obrador insisted that the US must refrain from interfering in Mexico. “We are awaiting a response… it is regrettable that the US has not taken our request seriously, but we will respectfully insist that they don’t finance political groups in Mexico”, López Obrador said, adding that “this is not right…particularly during an election”.

Looking Ahead: Harris is due to arrive in Mexico on 7 June. López Obrador has said that he does not intend to address this issue with her because it is not part of the set agenda. But she may decide to broach the matter herself and remind López Obrador of the US’s commitment to consolidating democracy around the world by supporting civil society groups that hold their governments to account.

* Mexico’s state-owned oil company, Pemex, has reported that the price of the Mexican oil blend has reached US$65.36 per barrel after increasing by 1.49% the previous day. This is the highest level since September 2019.

Southern Cone

On 2 June, Chile’s health ministry published its latest epidemiological report, which revealed that the number of active coronavirus (Covid-19) cases in the Santiago Metropolitan Region (RM) has reached a new high for the year, matching levels last seen during the first wave in June 2020.

Analysis:

Chile is facing another surge in Covid-19 infections despite having one of the most successful vaccine rollouts in the world. New daily cases have been climbing again, although daily deaths remain well below the levels seen during the first wave in June-July last year, raising questions over what is driving this surge given the country’s high vaccination rate. To date, 42.3% of the population has been fully vaccinated against Covid-19, which places Chile within the top five most vaccinated countries globally.

  • Chile’s health ministry recorded 5,631 new cases nationally yesterday, of which 2,827 are in the RM, bringing the cumulative total nationally to 1.39m. According to the epidemiological report, there are now 25,712 active cases of Covid-19 in the RM, which is the highest figure this year so far. There are reports that the hospital system is reaching capacity, with just 35 intensive care beds said to be available in the RM and 147 at national level.
  • This comes as health experts continue to question the government led by President Sebastián Piñera’s easing of restrictions for fully vaccinated people. As of 26 May, fully vaccinated individuals have been able to download a 'Pase de Movilidad' (‘mobility pass'), which allows greater freedom of movement within Chile.
  • Last week, nine medical societies released a statement criticising the move, saying that “we urgently need to reformulate the Paso a Paso [reopening] plan” and that “any increase in mobility is going to generate greater contagion, which the health system cannot withstand”.
  • President Piñera yesterday defended the implementation of the mobility pass in a television interview, stating that “a panel of experts recommended the implementation”.

Looking Ahead: Piñera did not rule out the possibility of tightening restrictions and withdrawing the mobility pass if necessary, saying last night that “as always, we are ready to re-evaluate everything in accordance with the data and the evolution of the pandemic”.

* Paraguay’s national service for livestock health and quality (Senacsa) has released new figures which show that the country’s beef exports totalled 142,576 tonnes (t) in the first five months of 2021, a new record for the period. The exports were worth US$638.7m. According to the Senacsa figures, over this period, Chile was the main export market for Paraguayan beef, accounting for 56 t, followed by Russia (36 t), Brazil (13 t), and Taiwan (12.5 t).

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