LatinNews Daily - 24 November 2021

On 23 November, the European Union’s electoral observation mission (EU-EOM) published its preliminary report on the 21 November regional elections in Venezuela, highlighting “irregularities” in the electoral process but stating that the process had improved compared to previous election cycles.

Analysis:

The EU-EOM’s preliminary report indicates that the elections were fairer than many in the opposition have claimed, although it underscores fundamental concerns about the electoral process. The report claims that voter coercion was widespread, and that the ruling Partido Socialista Unido de Venezuela (PSUV) had an inbuilt advantage through the irregular use of government funds in campaigning. Nonetheless, the report found no evidence of ballot manipulation, undermining the arguments of many in Venezuela’s opposition and the international community that the election was “stolen” by President Nicolás Maduro’s government. An uneven playing field was always going to be the best-case scenario for the opposition, and the onus was on opposition leader Juan Guaidó to drive up high turnout and unite Venezuela’s fragmented opposition parties in a broad coalition, neither of which happened.

• The director of the EU-EOM, Isabel Santos, declined to say whether the vote was free and fair, pending the publication of the mission’s final report. However, she noted that “there have been arbitrary bans on candidates for administrative reasons, there have been suspensions, or the most recognised leaders or members of some parties have been withdrawn.”
• Santos also highlighted the “extended use of state resources” in the election campaign by the PSUV, including unbalanced coverage in the media and “the delivery of goods, such as food rations, gas bottles or water tanks” that she said were aimed at influencing voters’ preference.
• The report states that voters were coerced into backing the PSUV, reporting that government officials outside polling stations scanned the identification cards of voters who receive state benefits. The opposition has denounced this practice as an intimidation tactic. According to the EU-EOM, coercion took place in all of Venezuela’s 23 states.
• However, Santos said that the election results appear to be “technically” reliable, with the EU-EOM’s report stating that “the automated voting system offered sufficient guarantees of integrity and confidentiality.” The report adds that despite the “persistence of structural deficiencies… electoral conditions improved in comparison to the three previous national elections [in 2020, 2018, and 2017].”
• Marta Hurtado, a spokesperson for the United Nations Office of the High Commissioner for Human Rights (OHCHR), yesterday called for investigations into several acts of political violence on polling day. She also cited “concerning” reports that some public employees had been forced to vote for the PSUV.
• US Secretary of State Antony Blinken went further on 22 November, tweeting that “opposition harassment, media censorship and other undemocratic tactics ensured Venezuela’s elections were neither free nor fair.”
• Maduro, meanwhile, has welcomed the EU-EOM’s report, tweeting yesterday that the election observers “have seen the reality of a country under attack, which is on its feet and overcoming its difficulties.”

Looking Ahead: Santos said that she will return to Venezuela “at the end of January or the beginning of February” to present the EU-EOM’s final report.

* Peru’s government has presented congress with its 2022 budget proposal, which envisages spending of PEN197.0bn (US$49.11bn) – a 7.6% increase on the 2021 budget. Of this, PEN139.8bn would go to the central government, PEN35.5bn to regional governments, and 21.5bn to local governments. The budget proposes spending PEN35.7bn on education (+7.85% on 2021), PEN22.0bn on healthcare (+6%), while the amount set aside for servicing the central government’s debt is PEN22.1bn. The government is also proposing spending PEN5.6bn on new infrastructure projects, and PEN1.9bn on delivering its planned agrarian reform, among other things.

On 23 November, the Associação Brasileira dos Produtores de Soja (Aprosoja), an organisation representing soya producers in Brazil, released a statement slamming new legislation proposed by the European Union (EU) which seeks to ban imports linked to deforestation as “trade protectionism dressed up as environmental concern”. 

Analysis:

The European Commission presented a law on 17 November which would set mandatory due diligence rules for importers of soya, beef, palm oil, wood, cocoa, and coffee (as well as some derived products such as chocolate), in an attempt to stop imports linked to deforestation. The EU framed this as an important step towards meeting the pledge made at the COP26 climate summit to end deforestation by 2030 – a pledge also signed by Brazil, which has even brought forward its own zero deforestation target to 2028. Yet Aprosoja’s strongly worded response to the EU provides further evidence that this pledge is little more than empty words on Brazil’s part. 

• Aprosoja slammed the EU legislation as “an affront to national sovereignty” and accused Europe of continuing to treat Brazil as its colony. 
• The soya producers cite Brazil’s forest code – which obliges land owners to preserve between 20% and 80% of the vegetation on their land depending on the biome – and the commitments adopted by the government led by President Jair Bolsonaro at the COP26 as more than sufficient environmental protections. Aprosoja adopts a discourse very similar to Bolsonaro’s in refusing to admit that unfettered deforestation and environmental destruction are a problem in the Amazon, and in other Brazilian biomes such as the Cerrado.
• While some sectors of Brazilian agribusiness have been pushing for the Bolsonaro government to adopt a more environmentally sustainable stance, this does not appear to be Aprosoja’s case. A BBC Brasil report published earlier this month found that the Mato Grosso chapter of Aprosoja has been funding a series of lectures by climate change deniers. Mato Grosso is the biggest soya-producing state in Brazil.  

Looking Ahead: Both the EU’s proposed legislation (which must be passed by member states) and the reaction to it in Brazil could further impact the stalled trade agreement between the EU and the Southern Common Market (Mercosur); the deal is yet to be ratified amid an ongoing impasse over Mercosur countries’ – and notably Brazil’s – environmental commitments.

* The Companhia Nacional de Abastecimento (Conab), the logistics arm of Brazil’s agriculture ministry (Mapa), has released new projections for the country’s sugarcane harvest, which is expected to slump due to the effects of adverse weather. The Conab expects Brazil’s 2021/2022 sugarcane harvest to yield 568.4m tonnes (t), down 13.2% on the 2020/2021 harvest. This would reportedly be the smallest sugarcane harvest since the 2011/2012 season. The Conab explains this by citing the unusual frosts which swept through some key producing states, such as São Paulo, Mato Grosso do Sul, and Paraná, in June-July this year. The Conab further notes that the lower harvest is already impacting exports, with sugar exports in the first seven months of the 2021/2022 harvest (April-October) down 17.9% compared with a year earlier, with lower supply pushing up prices on the domestic market and reducing exports. Brazil is the world’s largest producer and exporter of sugarcane.

On 23 November the United Nations (UN) High Commissioner for Human Rights (OHCHR), Michelle Bachelet expressed her “deep concern” about political violence in Honduras.

Analysis:

With less than a week until the 28 November general election, fears regarding violence are mounting ahead of the vote, which surveys suggest could produce a victory for Xiomara Castro, the leftist presidential candidate for opposition alliance ‘Alianza por el Pueblo’ over Tegucigalpa mayor Nasry Asfura, of President Juan Orlando Hernández’s conservative ruling Partido Nacional (PN). This has sparked concerns regarding a repeat of the deadly post-electoral violence which afflicted the 2017 election, which was widely slammed as fraudulent, and comes amid other fears regarding the integrity of the vote.

• An OHCHR statement notes that since primary elections were called in September 2020, the UN Human Rights Office in Honduras has recorded 63 cases of political violence, including 29 killings, 14 attacks, 12 instances of aggressive behaviour, as well as seven people directly threatened and one kidnapped.
• Bachelet locates these concerns about political violence within the context of a deteriorating human rights situation and a “shrinking civic space in the country, with members of civil society and human rights defenders (HRDs) regularly harassed, persecuted and attacked.” The OHCHR notes 240 attacks against HRDs and journalists registered this year.
• A 21 November report by local think tank Centro de Estudio para la Democracia (Cespad) highlighted political violence among seven main risks during the current electoral process. Other risks include the role of the national electoral council (CNE) which, along with the electoral court of justice (TJE), was created to replace the electoral authority following the 2017 vote. These new bodies are split equally among the three main parties (PN, the opposition Partido Liberal, and Partido Libertad y Refundación – one of the main parties in the alliance backing Castro). This has prompted concerns that agreements on solutions are unlikely if results are contested. Associated with this, Cespad identifies as a further risk the lack of an electoral procedural law to enable the TJE to carry out its functions.

Looking Ahead: In its report, Cespad is also warning of possible issues involving operational procedures on voting day itself, due to delays in the acquisition of services and equipment related to the preliminary rapid vote count (TREP) system and biometric equipment to carry out fingerprinting at polling stations (JRVs).

* Panama’s national statistics institute (Inec) has released figures which show that the country’s monthly indicator of economic activity (Imae) posted year-on-year growth of 18.02% in September. This brings the accumulated growth in the first nine months of 2021 to 14.94% compared with the same period in 2020, indicating continued recovery from the impact of the coronavirus (Covid-19) pandemic which caused Panama’s GDP to shrink by 17.9% in 2020. It cites mining, trade, construction, other community, social & personal services, transport, and storage & communications as sectors which posted a good performance.

On 23 November Mexico’s President Andrés Manuel López Obrador defended a decree announced the previous day which declares infrastructure projects carried out by the federal government to be an issue of national security.

Analysis:

The decree has produced a wave of criticism both locally and abroad, as well as complaints that it is unconstitutional. President López Obrador’s critics argue that it undermines his insistence that his left-wing Movimiento Regeneración Nacional (Morena) government is committed to transparency and accountability and it has subjected the president to fresh claims of authoritarianism and fears regarding the rule of law and separation of powers in Mexico.

• Yesterday in his morning press briefing, President López Obrador insisted that the decree was aimed at stopping bureaucracy from holding up projects. “This has nothing to with transparency,” he said, adding that it is an “internal matter between agencies”. He said it was aimed at speeding up progress on works such as the Tren Maya railway line in the Yucatán peninsula (a project rejected by Maya indigenous groups in Yucatán state which has triggered a string of legal challenges against it).
• Yesterday the national institute for transparency and access to information (INAI), an autonomous government body, announced that it was presenting an appeal before the supreme court (SCJN) against the decree on the grounds that it could jeopardise the right to access to information.
• Yesterday the president of the right-wing opposition Partido Acción Nacional (PAN), Marko Cortés, announced that the PAN would challenge the decree “through all possible legal channels”.
• Private sector lobbies such as Consejo Coordinador Empresarial (CCE) and the confederation of industrial chambers (Concamin) have also rejected the decree. The CCE issued a statement warning that it evades various constitutional and legal norms in place to protect human rights, the environment, transparency, access to public information, economic competition, protection of public resources, and the fight against corruption.

Looking Ahead: The decree is also stoking concern from abroad at a time when other proposed reforms, such as the government’s controversial electricity reform, have sparked fears about the investment climate in Mexico. Yesterday José Miguel Vivanco, the Americas director of US-based NGO Human Rights Watch, tweeted that “every day it becomes more evident that President López Obrador believes himself to be above the law.”

* Mexico’s former finance minister Arturo Herrera (2019-2021), who President Andrés Manuel López Obrador had previously indicated he intended to nominate as the next president of the central bank (Banxico), has said he could “confirm” that López Obrador told him last week he had “decided to reconsider” his decision. Herrera was named in June to succeed Banxico governor Alejandro Díaz de León, whose term expires in December – an appointment which was well received by the markets. López Obrador has failed to provide reasons for this decision to reconsider the appointment. The uncertainty over who will take over at the helm and the direction of monetary policy comes at a time of high inflation and speculation regarding future rises in interest rates.

A Factum survey published on 23 November shows support for the ruling centre-right coalition in Uruguay remains high at 50%, while the left-wing opposition coalition Frente Amplio (FA) is backed by 40% of respondents.

Analysis:

The survey brings broadly good news for President Luis Alberto Lacalle Pou, who in March will have completed the first two years of his five-year presidential term. It showed that if general elections were to be held now, his ‘multicolour’ coalition would win, with a 10-percentage point advantage over the Left. This is consistent with Lacalle Pou’s high personal approval rating. 

• The FA remains the single most popular party with 39% support. It is followed by the five members of Lacalle Pou’s coalition: Partido Nacional (PN) on 30%, Cabildo Abierto (CA) (9%), Partido Colorado (PC) (8%), Partido Independiente (PI) (2%), and Partido de la Gente (PG) (1%). 
• Party support appears to have remained broadly constant in the two years since the October 2019 general election. The FA’s 39% is unchanged, while ruling coalition parties have dropped four percentage points from 54% to 50%.  
• Lacalle Pou’s handling of the coronavirus (Covid-19) pandemic has been popular, helping the PN and coalition partners. His own approval rating was last measured by Factum in September at 61%. Approval peaked at 66% in late-2020, dropped to 56% in February 2021 as Uruguay experienced a pandemic second wave, and has since recovered. 
• Two future events may ‘move the needle’ as far as party support and presidential approval ratings are concerned. In December the FA must renew its party leadership. Currently the main contenders for both the presidency and the vice-presidency of the party are the mayors of Canelones, Yamandú Orsi, and Montevideo, Carolina Cosse. Both are potential 2024 presidential candidates. 
• The second key event is likely to be the referendum in March on whether to approve or reject 135 articles in the government’s omnibus reforms law, the Ley de Urgente Consideración (LUC). Polls suggest a majority voters are likely to align with the government rather than the opposition on this issue. 

Looking Ahead: A separate poll by Cifra focusing on the leadership contest within the FA suggests that Orsi is ahead, with 31% of the general population supporting him, against 12% backing Cosse, followed by former president José Mujica (2010-2015) and former mayor of Montevideo Daniel Martínez, each with 4%. 

* Argentina’s national statistics institute (Indec) has released new figures which show that economic activity grew 11.6% in September compared with the same month in 2020. Compared with August, economic activity rose by 1.2%, marking the fourth consecutive monthly increase. The largest year-on-year jumps in economic activity were in community, social & personal services (66.9%) and hotels & restaurants (59.1%), although the total yearly increase was driven predominantly by growth in industrial manufacturing (10.1%) and retail (10.1%). Meanwhile, Indec reported reductions in economic activity in the fishing sector (-9.6%) and in agriculture, livestock, hunting & forestry (-1.7%).