LatinNews Daily - 23 November 2021

On 22 November, El Salvador’s attorney general’s office (FGR) and the police (PNC) carried out raids on seven NGOs in El Salvador.

Analysis:

The raids, which the FGR claims were in relation to a corruption investigation, will fuel existing human rights and democracy concerns regarding the perceived authoritarianism of President Nayib Bukele and his Nuevas Ideas (NI) government. These concerns have intensified since May when the new NI-controlled legislature took up its seats and fired the head of the FGR, Raúl Melara, along with the supreme court (SCJ)’s constitutional chamber (SC) (all Bukele critics), installing government loyalists. The raids come as local and international human rights organisations are already on the alert over a proposed foreign agents law, which these groups compare with legislation passed last year in Nicaragua which shuttered NGOs and was widely condemned as repressive.  

• The NGOs targeted in yesterday’s raids were: the association of community projects (Procomes); the women’s rights groups Mélida Anaya Montes and Asociación de Mujeres Tecleñas; democracy & social development NGO Fundaspad; Una Mano Amiga, an organisation which helps victims and those affected by gangs; humanitarian group Asociación Salvadoreña de Ayuda Humanitaria PRO-VIDA; and environmental group Fundación Ambientalista de Santa Ana.
• An FGR statement said that the raids were part of an investigation into a case opened in August in line with a request by the legislature regarding possible anomalies to have emerged out of the process of adjudicating, executing and monitoring of State funds awarded to these NGOs. The FGR says that 32 agreements signed by these organisations with different ministries and government bodies were subject to question.
• The targeted NGOs have slammed the raids as political persecution.
• The raids come as international criticism mounts over the proposed foreign agents initiative, which awaits approval by the legislature. The bill, which contemplates the creation of a foreign agents’ registry attached to the interior ministry, seeks to establish a legal framework which “would make transparent international donations to different organisations”.  It also establishes a 40% tax on foreign donations to such organisations. Some sectors are exempt, such as businesses with “strictly commercial” aims, diplomatic missions, and humanitarian, religious, and academic activities (among others). However, those implicitly included would be organisations working on anti-corruption, transparency, human rights, and rule of law, many of which have been critical of Bukele.
• Also drawing concern, the bill stipulates that those registered as “foreign agents” are barred from carrying out “political activities” that aim to alter “public order” or that “endanger or threaten national security or the social and political stability of the country”.
• The bill has been condemned by United Nations Special Rapporteurs Mary Lawlor (Human Rights Defenders) and Clément Voule (Freedom of Peaceful Assembly and of Association) as well as international human rights organisations such as Human Rights Watch and Amnesty International.

Looking Ahead: The raids and democracy concerns are likely to place a further strain on relations with the US, which are already at a low point after President Bukele accused it of financing the political opposition and seeking to facilitate the rupture of the NI parliamentary bloc. Yesterday US ambassador to El Salvador Jean Manes told journalists that she was returning to her position as civilian deputy commander at US Southern Command. She was cited as saying that the Salvadorean government had no interest in improving relations, reportedly questioning “Why am I going to stay here if we don’t have a counterpart at this time?...When El Salvador wants to talk, our doors are always open.”

On 22 November, Óscar Iván Zuluaga won the ruling right-wing Centro Democrático (CD) party’s nomination for Colombia’s May 2022 presidential election.

Analysis:

Zuluaga has some serious ground to make up if he is to become Colombia’s next president. The CD’s image has been tarnished in the eyes of many voters by the violent crackdown on anti-government protesters earlier this year, and longstanding inequalities exacerbated by the coronavirus (Covid-19) pandemic appear to have driven up support for the leftist frontrunner Gustavo Petro (Colombia Humana).

• Zuluaga will stand for the ruling CD, which has been dragged down in the polls during President Iván Duque’s turbulent final year in office. He will face a major challenge improving the party’s reputation following the Duque administration’s much-criticised response to the prolonged social unrest earlier this year, which saw widespread police brutality.
• Zuluaga is a well-known figure among Colombia’s conservatives, winning the first round of the 2014 presidential election before losing in the run-off vote to Juan Manuel Santos (2010-2018), and serving as finance minister from 2007-2010 under former president Álvaro Uribe (2002-2010).
• As the ‘Uribista’ candidate, Zuluaga can be expected to maintain CD’s hardline stance on security issues. He is critical of the 2016 peace agreement with the Fuerzas Armadas Revolucionarias de Colombia (Farc) guerrilla group, although he has said he would support the peace deal if he wins the presidency. Accepting the party’s nomination, he said aims to deliver “Democratic Security 2.0” – a reference to Uribe’s flagship security programme, which dramatically reduced violence but also saw widespread human rights abuses by the security forces.  
• Zuluaga is likely to be popular with Colombia’s business community, having successfully averted a recession following the 2008 financial crisis during his time as finance minister. A supporter of free trade agreements and a firm backer of the fiscal rule limiting government deficits, Zuluaga will position himself as the market-friendly alternative to Petro.

Looking Ahead: Petro continues to hold a striking lead in the polls with 22% of the intended vote, according to a 13 November poll by the Centro Nacional de Consultoría (CNC). Zuluaga only scored 3% of voting intentions in that poll, although he can expect to receive votes from supporters of his main rival for the CD nomination, María Fernanda Cabal, who polled 4%.

* Peru’s national statistics institute (Inei) has released the latest quarterly GDP figures, showing that the country’s economy expanded by 11.4% in Q3 2021, compared with Q3 2020. GDP also increased by 2.8% relative to the preceding quarter. This is the first quarterly GDP update to cover the administration of President Pedro Castillo, who took office in late-July. Inei noted that the year-on-year growth was driven by a 24.1% increase in gross fixed capital formation, an 11.8% increase in household consumption, and a 6.6% increase in government consumption. Inei also highlighted the economic recovery of Peru’s trading partners from the coronavirus (Covid-19) pandemic as a key factor in the GDP growth, noting that exports of goods and services increased by 9.2% in Q3 2021 compared with Q3 2020.

On 22 November, the public prosecutor’s office in Brazil’s Rio de Janeiro state (MPRJ) announced that it is launching an investigation into a police operation carried out in the Complexo do Salgueiro favela in the municipality of São Gonçalo a day earlier, and which seemingly left over a dozen people dead. 

Analysis:

Local residents found at least eight bodies in a mangrove after an operation led by the state military police’s (PM) special operations unit (Bope) in the Complexo do Salgueiro on 21 November, and there have since been reports of further victims. The police say the deaths were the result of a shootout after they were met by heavy fire from criminals; locals say the police carried out a massacre and that the bodies of the victims bore signs of torture. 

• Bope’s 21 November operation came a day after a PM sergeant died after being shot at during a patrol in a neighbourhood in the Complexo do Salgueiro. On Twitter, the PM said the operation was carried out to “stabilise the situation and cease confrontations” and that it has launched an internal investigation into the events; residents accuse the police of entering the favela with the intention of killing out of revenge. 
• Eight male bodies were found and removed from the mangrove, seven of which have been identified. But there are reports of more victims; Faferj, a grouping of Rio state’s favela associations, said on Twitter that 14 bodies had been found, including three girls. Meanwhile, according to residents’ accounts in the local press, some of the victims were disfigured. 
• “What happened this weekend in the Complexo do Salgueiro is a tragedy, but not an exception”, Maria Isabel Couto, programmes director at the Instituto Fogo Cruzado, which runs a platform that monitors shootings in Rio, said. NGO Human Rights Watch put out a statement yesterday questioning the police’s version of events, recalling that the supreme court (STF) banned police operations in Rio’s favelas for the duration of the coronavirus (Covid-19) pandemic, and calling for a thorough and impartial investigation by the MPRJ. 

Looking Ahead: Brazil’s police are rarely brought to justice for the abuses they commit while on duty – following the Jacarezinho massacre in May, just two police officers have been charged by the MPRJ, and none have yet been convicted.

*Brazil’s central bank (BCB) has released the latest issue of its Focus bulletin, a weekly survey of private sector economists and analysts, in which the country’s inflation is now forecast to close the year at 10.12%. Inflation forecasts for 2021 have been revised upwards for 33 consecutive weeks, and this is the first time that they have passed double digits; inflation was predicted to close 2021 at 9.77% in the previous Focus issue. Meanwhile, GDP growth forecasts are being revised downwards, with the analysts surveyed by the BCB now expecting 4.80% growth this year, down from a forecast of 4.88% a week earlier. 

* A group of over 20 Nicaraguan opposition organisations including the main opposition groups Alianza Cívica por la Justicia y Democracia (ACJD) and Unidad Nacional Azul y Blanco (UNAB), have signed a letter urging the Central American development bank (BCIE) to condition its assistance to Nicaragua on respect for human rights. The letter urges the BCIE to condition future assistance on the “liberation of political prisoners, an immediate end of all repression against the media and citizens and the fulfilment of resolutions by the Organization of American States (OAS) which establish minimum conditions to hold free and democratic elections”, among other things. It follows mounting human rights concerns following the 7 November general election, which was criticised by the international community, including the OAS – this criticism led President Daniel Ortega’s government to announce it was leaving the OAS. According to a report published last month by investigative media Confidencial, the Nicaraguan government received over US$2.29bn from the BCIE between January 2017 and June 2021.

On 22 November, Mexico’s President Andrés Manuel López Obrador issued a decree which declares infrastructure projects carried out by the federal government an issue of national security. 

Analysis:

In practice, this decree means that López Obrador’s flagship – but controversial – ‘Fourth Transformation’ infrastructure projects such as the Tren Maya railway line in the Yucatán peninsula, the Felipe Ángeles international airport in the Estado de México, and the Dos Bocas oil refinery in Tabasco state are considered issues of national security, and can thus be pushed through with fewer obstacles and less oversight. With a number of these projects already under the contentious responsibility of the military, this latest move by López Obrador will fan concerns about failure to heed institutional processes and lack of transparency. 

• The decree, published in last night’s issue of the official gazette, declares any infrastructure project carried out by the government in the areas of “communications, telecommunications, customs, border control, hydraulic, water, environment, tourism, health, railways, the rail transport sector in all its energy modalities, ports, airports” to be an issue of public interest and national security. The decree notes that such projects are important for economic growth and job creation, and part of the government’s objective of pursuing economic development and social wellbeing. 
• The decree instructs federal public entities to provisionally issue the necessary permits and authorisations for such projects to go ahead. Although all of the decree’s implications are yet unclear, it seems like it will protect López Obrador’s flagship megaprojects from being slowed down or suspended by legal challenges. 
• Political observers and critics of the president have slammed the decree, questioning its constitutionality. “In practice, with this the federal government conceals from public scrutiny any works or project it has, this is flagrantly unconstitutional, López Obrador’s contempt for legality is cynical”, Felipe Fernando Macías, a federal lawmaker for the opposition Partido Acción Nacional (PAN), denounced on Twitter.   

Looking Ahead: With a former supreme court (SCJN) justice José Ramón Cossío having also declared the decree to be “evidently unconstitutional”, López Obrador’s latest move to protect his Fourth Transformation agenda could well be challenged in the courts.

* Mexico’s national statistics institute (Inegi) has released the results from its latest national employment survey (Enoe) for the July-September 2021 quarter which show that the unemployment rate in Mexico reached 4.2%, corresponding to 2.5m people being unemployed. This is down from 5.2% unemployment registered in the same quarter in 2020, when there were stronger impacts from the coronavirus (Covid-19) pandemic. The Enoe also shows that Mexico’s economically active population – people over the age of 15 who are employed or seeking employment – has grown by 4.7m compared with the same quarter in 2020 and totalled 58.3m, equivalent to 59.4% of the overall population aged 15 and over. Meanwhile, the underemployment rate fell to 12.9% in the third quarter of 2021, from 16.9% in the same quarter in 2020. However, the same figures showed that the number of people employed in the informal sector totalled 31.4m, up 3.9m on the same period in 2020 and equivalent to 56.3% of the employed population.

On 22 November the first opinion polls for the 19 December presidential second round run-off were published, which showed far-right candidate José Antonio Kast and left-winger Gabriel Boric in a technical tie.

Analysis:

A Cadem opinion poll conducted between 16-19 November showed Kast (who won the 21 November first round by 27.9% to 25.8%) and Boric each with 39% support. Another poll, by Pulso Ciudadano (conducted 9-12 November) also showed a virtual tie, with 35.9% for Boric and 35% for Kast.

• The prospect of a Kast victory lifted sentiment in financial markets, with the Santiago stock exchange up by 9.7%, its largest single day jump in 13 years. The peso strengthened against the US dollar.
• To win the run-off the two candidates must both secure the endorsement of the first-round candidates and attract those who didn’t vote.
• Over 40% of the first-round vote was cast for candidates who failed to make it thought to the second round, principally liberal economist Franco Parisi (who came third), centre-right Sebastián Sichel (fourth) and centre-left coalition leader Yasna Provoste (fifth). Turnout was 55%.
• Parisi has said that his Partido de la Gente (PDG) will launch an online consultation of its members over who PDG should endorse. In the 2013 election no formal endorsement was made but PDG voters ended up favouring the conservative candidate. The Pulso Ciudadano poll suggests this time PDG members will split narrowly (28%-27%) in favour of Boric.
• In some initial and ambiguous comments, Provoste fell short of endorsing Boric, but the Partido Socialista (PS), a member of her coalition, did not hesitate to do so, saying the priority was to block the threat posed by the extreme right.
• Sichel was already on record saying he would not endorse Boric, with members of his coalition therefore leaving the door open to formally endorsing Kast.
• In a bid to reassure centrist voters Boric said that his political ally, the Partido Comunista (PCCh) mayor of Recoleta (Santiago province), Daniel Jadue, would not be offered a position in his government.

Looking Ahead: Ahead of the run-off, the two candidates will try and secure endorsements as quickly as possible. Perhaps trying to maximise his leverage, Parisi has said his proposed ‘digital consultation’ will be held in the first half of December, very close to polling day. 

* Chile’s lower chamber has approved the government’s proposed 2022 state budget, which is for C$60.7trn (US$82.1bn). This represents a 3.7% increase on the approved 2021 budget, but actually equates to a 22.5% reduction in real spending this year, as extraordinary expenditures related to the coronavirus (Covid-19) pandemic are expected to bring the 2021 budget execution to Cl$78.2trn (US$99.56bn). The government led by President Sebastián Piñera highlights as priorities: health (the budget for which will increase by 11.6%); children (the social development & families ministry received a 12% increase); and public investment (the government highlights increases of 11.6% and 8% for the ministries of public works and housing respectively), among other things. Finance Minister Rodrigo Cerdo also said that the budget was in line with the government’s priority of “fiscal sustainability”.