The official line was that Cuban voters had delivered an expression of mass participatory democracy. But, while it is true that any other government in Latin America would be envious of voter turnout of 91.9%, in Cuba it is a serious disappointment. One vote attracted particular attention. Cuba’s spiritual leader Fidel Castro cast his vote, albeit by proxy. He also penned a stinging rebuttal in the self-proclaimed Communist party mouthpiece Granma of speculation in the foreign press that he might be dead or dying, complete with photographic proof of life.

Of the more than 8.5m Cubans eligible to vote in municipal elections on 21 October, 91.9% did so, according to the national election commission (CEN). The turnout in the last municipal elections, in April 2010, was 94.7%, or 8.4m.

Cuba’s municipal elections are the country’s only direct elections by secret ballot, albeit only the Partido Comunista de Cuba (PCC) is entitled to compete and candidates have to be nominated in neighbourhood meetings in their respective constituencies by raised hand, under the attentive eye of party stalwarts, thus ensuring a tight control over the process.

The dissident opposition argues that this process makes a mockery of free elections as candidates are not permitted to campaign and the only thing voters know about them is a short biography compiled by the CEN - made up of members of the PCC - and a photograph in the voting centres.

Voters elected a total of 14,537 delegates from just over twice as many candidates to positions on 168 municipal assemblies. There will be a second round on 28 October for those candidates who failed to win 50% of the vote. These were the 15th municipal elections, held every two and a half years since the organs of popular power were established in 1976.

Rubén Pérez, secretary of the CNE, argued that the elections were the consummate example of mass participatory democracy as “no delegate represents any political interest, only society itself”. Dissidents contend that precisely because no delegate can represent any political interest other than the PCC, or campaign on any issue not endorsed by the party, the elections are a sham.

During the PCC conference on 28 January, President Raúl Castro called for more open debate in the media and more democracy within the PCC and society, such as elections to management committees for instance, but he made it clear that Cuba would remain a one-party state. “All those Cubans who love their country and respect it can find space in the PCC,” he said, adding that the single party system was a legacy of the “permanent aggression, economic blockade, interference and media siege” the Revolution had endured from the US.

The municipal elections are only the first stage in general elections which become progressively less participatory at each subsequent stage, when the elections become indirect. The municipal assemblies wield no real power; their principal role is to elect deputies to provincial and national assemblies but they can only choose from a slate of candidates compiled by a commission composed of senior party loyalists of the ‘organisations of the masses’, which is ultimately presided over by members of the PCC central committee. During this process, which will take place in early 2013, 50% of the deputies to the provincial and national assemblies will be chosen from the 14,537 delegates; the other 50% from a list of revolutionary celebrities.

The national assembly, which meets just twice a year for a few days, merely rubberstamps government initiatives and selects the 31-member council of state and the council of ministers, presided over by Castro. This is where real political power is concentrated – and at this stage of the electoral process not only are the elections indirect but they also only involve the elected deputies who are sure to be the most unswerving loyalists.

Fidel in rude health

President Castro was the first to vote in the municipal elections - at dawn. His brother Fidel also voted - by proxy. Fidel burst back into the news the day before the elections, when he entertained the recently replaced Vice-President of Venezuela, Elías Jaua. He also wrote an article in Granma berating “organs of information, almost all of which are in the hands of the privileged and the rich” and maintaining that he had stopped publishing his ‘Reflections’ with such regularity (the last came out in June) “because it certainly is not my role to occupy the pages of our newspaper”.

Castro concluded that “I don’t even remember what a headache is. To show what liars they are, I’m offering these photos to accompany this article.” The photos showed a frail but resolute Fidel clutching in his hand a copy of Granma, dated 19 October. Jaua also produced a photo in which he can be seen smiling with Fidel and others for assembled journalists in the Hotel Nacional in Havana. He said he had spent five hours talking about “agriculture, history and international politics” with a “very well, very lucid” Fidel.

“D” for democracy

Cuba’s dissident blogger Yoani Sánchez uploaded to Twitter a picture of her ballot slip upon which she had written in indelible ink - “Democracy”. While she was defying the current political system, the former diplomat, historian and Communist party cardholder, Pedro Campos, led a campaign to persuade Cubans to write “D” on their ballot slips to demand “democratic socialism”.

Campos, one of the leaders of Socialismo Participativo y Democrático (SPD), said it was important to take President Castro at his word when he called for “more democracy for the party and society” at last January’s party conference. He said that far from constituting dissidence this “D” would amount to revolutionary affirmative action.

Campos argued that Cuba’s “stagnant” revolutionary process needed to learn from Venezuela’s recent elections, which had cemented “democratic socialism”. He called for the introduction of direct elections for president and vice-president; respect for the political and economic rights of Cubans, especially freedom of expression, association and movement; and the concept of the popular referendum on laws affecting all citizens.

Oswaldo Payá, one of the most prominent dissidents in Cuba and leader of the Movimiento Cristiano Liberación before his death in a car crash on 22 July, argued that there was nothing to be gained from casting any ballot. Two days before his death, Payá wrote a piece entitled ‘There are no free elections without free men and women’. “(The vote) is not free and therefore it is totally senseless participating in any way in elections which contradict democracy,” Payá argued.

Separately, Angel Carromero, a Spanish political activist, was sentenced by a Cuban provincial court last week to four years in prison for the deaths of Payá and a colleague, Harold Cepero. Carromero was behind the wheel of a rental car in the eastern province of Granma when it spun off the road and hit a tree, claiming the lives of the two men. He was found guilty of manslaughter from dangerous driving. A front seat passenger, Jens Aron Modig, a Swedish youth political activist, was allowed to return home after being held for one week after the accident, after he apologised for “illicit activities” and allegedly giving Payá €4,000 (US$4,900) from his Christian Democratic party.

• Importance of the vote

The president of the national electoral commission (CNE), Alina Balseiro, had exhorted Cubans not to “forget the times the country is experiencing”. She said it was more important than ever for Cubans to vote en masse after last year’s Communist party congress and last January’s party conference, and the publishing of the ‘Economic and social policy guidelines’.

Over recent months Peru’s judiciary has attracted a lot of unwanted attention by issuing a series of highly controversial rulings that have been negatively received by the general public. The judiciary’s actions have caught the attention of both the Ollanta Humala government and international human rights organisations, which have expressed concerns that these may have promoted impunity and undermined the defence of human rights in Peru. Despite the fact that at least in one instance the Inter-American Court of Human Rights (CorteIDH) has already forced the judiciary to revise its ruling, Peruvian judges appear to remain contrarian, opening themselves up for more criticism. This situation may prompt President Humala to opt for an extensive judicial reform.

Since former president Alberto Fujimori (1990-2000) carried out an extensive purge of the judiciary during his 1992 autogolpe, Peru’s judiciary has had to work hard to regain some of its credibility while at the same time maintain an image of political independence. After Fujimori was stripped of the presidency by congress, the judiciary did manage to make some important advancements - during the governments of Alejandro Toledo (2001-2006) and Alan García (2006-2011) - in handling many of the corruption and human rights violations cases that took place under Fujimori’s authoritarian rule. Indeed, Peru’s justice system showed that it was capable of going after even some of the highest ranking members of the Fujimori government, including the former president himself, who was handed down a 25-year prison sentence in 2009. This earned Peru praise from international human rights organisations and institutions, including the Inter-American Human Rights Commission (ComisiónIDH), for redressing human rights abuses perpetrated by the State.

However, fast-forward a couple of years and it seems that he situation has changed drastically, with Peruvian judges all of a sudden appearing reticent to hand down similar sentences in other prominent human rights violations cases. In fact, some of the recent court rulings go against what local and international courts have already established, prompting questions about the competency of some of Peru’s top magistrates.

The mishaps began back in July, when the supreme court’s penal chamber ruled that the so-called ‘Barrios Altos massacre’- in which the government-sponsored military death squad, the Grupo Colina, killed 15 people in Lima’s Barrios Altos neighbourhood in 1991- did not constitute a crime against humanity and were common murders. Thus, the president of the chamber, Judge Javier Villa Stein, resolved that all those implicated in the case, including Fujimori (who was convicted for these crimes) and his former top advisor, Vladimiro Montesinos, should have their prison sentences reduced from 25 years (the maximum allowable under Peruvian law) to 20 years.

The ruling triggered indignation, not only from the victims' relatives and local and international human rights organisations, but also from the government. Justice Minister Eda Rivas and Prime Minister Juan Jiménez Mayor (who was the acting justice minister until 23 July) rejected the ruling and said that the government would challenge it. In addition, the head of the judiciary, César San Martín, who presided over the trial that convicted Fujimori in 2009, also frowned upon the ruling, pointing out that it went against what had already been determined by the CorteIDH in 2001, when it ordered the Peruvian State to conduct a full investigation into the human right violations committed in the Barrios Altos incident and punish those responsible accordingly. San Martín added that this being the case, the ruling left Peru open to being sanctioned by CorteIDH for its inability to follow its instructions.

Yet Villa Stein, San Martín’s predecessor as the head of the judiciary, staunchly defended the controversial ruling, arguing that it had been handed down unanimously and independently by the chamber's sitting judges. As such, Villa Stein said that the ruling should not only stand, but must be respected; otherwise, the judiciary’s authority would be undermined. On this point San Martín agreed with Villa Stein and said that he and the government were powerless to change the ruling.

One crisis averted

Any direct attempt by the government to change the ruling, as Villa Stein pointed out, would have negative consequences as it would be construed as an attempt to influence the supreme tribunal and would ultimately erode the independence of the Peruvian judicial branch. Nevertheless, the government found a way to exert pressure to get the ruling changed. At a CorteIDH follow-up hearing of the case on 27 August, the government's representatives made it clear that they were in disagreement with the ruling, which they recognised was incongruous with the CorteIDH’s previous ruling and intimated that the government was preparing a challenge. After the hearing, the CorteIDH issued a resolution (on 24 September) ordering Peru’s judiciary to annul the ruling, which it found to be “incompatible with the commitments assumed by Peru following its ratification of the Inter-American convention on Human Rights”. As predicted by San Martín, the CorteIDH warned that if Peru failed to annul the ruling, the country could be sanctioned.

A number of Peruvian judges reacted negatively to the resolution, considering that it was “an unacceptable intromission” in the country’s internal affairs. Villa Stein said that it represented “an affront to Peru’s sovereignty” and warned that it could set a “negative precedent”. Yet San Martín said that Peru had to abide by the CorteIDH’s resolution since it is a superceding court. President Humala seconded San Martín and declared that the government would ensure Peru abided by the resolution of the CorteIDH, whose jurisdiction it fully recognises, sparking fears that highly damaging full-blown judicial crisis would ensue.

However, a few days later and unexpectedly, Villa Stein himself conceded that Peru must accept the CorteIDH’s resolution, even if his chamber’s ruling had “perfectly adhered to international standards”. The following day, San Martín confirmed that the penal chamber had annulled the ruling and would now seek to convene a new judges’ panel, which is to deliver a new ruling.

A new crisis looms

While Villa Stein’s decision to back down averted what was shaping up as a major confrontation between the judiciary and the government, it was not long before the tensions were heightened once again. On 15 October in yet a another ruling that appeared to favour Fujimori’s associates (see sidebar), a Callao criminal court absolved Montesinos and two former army officers of charges of premeditated murder in relation to another prominent human rights violation case, known as ‘Chavín de Huántar’. Chavín de Huántar was the code name of the 1997 military commando rescue operation that freed the people being held hostage by members of the Movimiento Revolucionario Túpac Amaru (MRTA) for four months at the residence of the Japanese ambassador in Lima. While the operation, in which 71 of the 72 hostages were rescued alive, is considered to be Peru’s most successful military rescue operation ever, it has been tarnished in recent years by claims that at least three of the 14 MRTA members killed were summarily executed after they had surrendered.

Montesinos, the architect of the feared national intelligence service (SIN) - believed to have been behind many of the atrocities perpetrated by the Fujimori administration - has been accused by the families of those allegedly executed MRTA members of ordering their extrajudicial killing. This case was taken to the CorteIDH in 2003, prompting the Peruvian government to launch its own investigation. However, in the latest ruling two of the three sitting judges found that the evidence presented by the attorney general’s office was insufficient to determine a “parallel chain of command” running from Montesinos to the military commanders in charge of the operation.

Yet the court acknowledged that sufficient evidence had been presented in support of the claims that at least three MRTA rebels had been captured alive and were later executed. Pointedly, the court reserved its judgement on a fourth defendant, (ret.) Colonel Jesús Zamudio Aliaga, who failed to attend the court session. Zamudio, who actively participated in the operation, has been accused of having delivered the captured rebels to SIN officers embedded in the operation, who allegedly carried out the execution.

This ruling has been met with disbelief. Gloria Cano, a lawyer from a local human rights group (Aprodeh) who is representing the families of the victims, complained that “The court has issued a very contradictory ruling…it could not determine that orders were given, but yet found that arbitrary executions nonetheless took place”. In Cano’s opinion, the ruling will only strengthen the case against the Peruvian State at the CorteIDH. Perhaps in an attempt to avoid another order to overturn the ruling, the attorney general’s office has announced that it will also seek to annul this case at the supreme court. The latest ruling may not have involved Villa Stein, but any annulment request surely would, which could once again trigger a crisis.

Taking these cases into account, President Humala may soon decide to include judicial reform in his government’s agenda and, what is more, make it a priority.

• San Martín apologises for Barrios Altos ruling

On 2 August the head of Peru’s judiciary, César San Martín, publicly apologised on behalf of Peru’s judges for the ruling made by the supreme court's penal chamber that reduced the sentences of those implicated in the Barrios Altos case. San Martín said that although he disagreed with the ruling, he would respect it, considering that the judges had acted “conscientiously and applying the criteria they considered to be correct”. However, he then remarked that all judges are “human” and can make mistakes, adding that “we must be humble and recognise this and ask for forgiveness”.

• Four in a row for Montesinos

The 15 October ruling by the Callao criminal court was the last in a series of rulings of cases involving Valdimiro Montesinos, in which the former government strongman was favoured. On 29 August he was absolved from involvement in a case in which 196kg of cocaine were found in the presidential palace in 1996. The courts had attempted to reduce the sentences of those involved in the Barrios Altos case on 22 July; while on 4 October he was also cleared in the case involving the embezzlement of PEN1bn from a military police pensions’ fund between 1990 and 2000.

A majority of the supreme court magistrates have voted to convict the former ‘political nucleus’ of the left-wing ruling Partido dos Trabalhadores (PT) for active corruption as the mensalão trial edges towards its conclusion.

The former president Lula da Silva (2003-2010), in whose first term the congressional bribery scheme known as the mensalão (‘big monthly payout’) took place, told PT candidates preparing for the municipal election run-offs on 28 October to walk with their heads held high. At a meeting of the national party directorate in São Paulo, he advised candidates not to allow their opponents to use the mensalão against them in the second round.

It was too late for that. José Serra, the opposition candidate in the most important run-off race, São Paulo’s mayoral contest, was the first to launch an attack on his PT rival and Lula protégé, Fernando Haddad, quipping that Haddad thought that Dirceu was a “little angel”.

The PT state governor of Bahía, Jaques Wagner, broke ranks with the party line to admit in an interview that the mensalão trial had probably weighed on the 2012 municipals, acknowledging that after three consecutive terms in office, the PT is likely to come against “voter exhaustion” in 2014, when President Dilma Rousseff is expected to seek a second term (and a fourth for the PT). The PT still grew its overall support in the 2012 municipals, but its coalition allies have become more emboldened (see lead), which could make for interesting talks about coalition slates for the 2014 general election.

Rather proverbially, on Day 33 of the trial (9 October) Judges Marco Aurélio and Gilmar Mendes found guilty the so-called political nucleus of the PT, comprising the former minister of the presidency, José Dirceu; the former party president, José Genoino; and the former party treasurer, Delúbio Soares. They were both clear that all the evidence to date placed Dirceu at the apex of the scheme, uncovered in 2005, whereby the PT funneled cash donations of siphoned off public money to legislators from both allied and opposition parties in return for their support in key congressional votes.

To date over 20 of the 38 defendants in the trial, including members of four political parties, have been found guilty on charges ranging from passive and active corruption to money laundering and the mismanagement of a financial institution. Dirceu was found guilty by a majority of six to two of the ten sitting judges on the case; Genoino by seven to one; and Soares by eight to one.

The two dissenters in the case of Dirceu were Judge José Antonio Dias Toffoli and Ricardo Lewandowksi. Dias Toffoli noted that while Dirceu might have been guilty of other crimes like influence peddling, there was insufficient evidence to charge him with active corruption. Lewandowksi, who has taken the softest line throughout the trial, made a similar argument and in the case of Genoino said that he was being condemned for the simple fact of being the party president at the time (2003-2005).

The defendants will only be charged at the end of the trial, expected by mid October. In theory, the convicted defendants could face lengthy prison sentences; in reality, few observers expect them to actually serve much time. Defence lawyers are pushing for their clients to serve ‘open time’, whereby they sleep in special prison cells and go out to work every day as normal.

Dirceu on 9 October published on his blog an open letter to the Brazilian people in which he said that he would accept the decision but would not rest until he proved his innocence. He repeated that the mensalão scandal was orchestrated by the PT’s enemies. He accused the supreme court of acting under strong media pressure, complaining that the court found him guilty without any evidence”. He concluded that his search for justice, without vengeance, would be “his reason to live”. Genoino said he was “revolted and furious”.

• Lula remains defiant

Some opposition politicians are pushing for Lula to be investigated for corruption, arguing that he could not have been oblivious to what was going on during the time of the mensalão. Lula has always maintained that the whole scandal was an opposition-concocted conspiracy to smear his government. One of the main convicted defendants (the publicist Marcos Valerio) has alleged that Lula knew all about it. It is unlikely, however, that these opposition attempts will prosper.

Selic falls to new low as Brazil trundles along at bottom

Citing worries about the international economy, Brazil’s central bank monetary policy committee (Copom) cut the benchmark Selic interest rate by 25 basis points to 7.25% on 10 October. For the first time in over a year, the decision was not unanimous, amid some concern about domestic inflation pressures.

The Copom has cut the Selic by 525 basis points since August 2011. The national index of consumer price inflation accelerated in September for the third month in a row, hitting 5.28% year-on-year as food and drink costs rose the most since December 2010. Private economists expect inflation to remain above the central target of 4.5% for the rest of the year but the central bank - and the government led by President Dilma Rousseff – is more concerned with growth. The finance ministry now admits that real GDP growth this year will be a weak 1.5%-1.6%, well down on the 4.0% it predicted at the beginning of the year.

The Brazilian Real has declined 8.6% to date in 2012, as the central bank has stepped up its US dollar purchases in support of exporters. It was trading at R$2.04/US$ on 11 October, after the latest Selic reduction.

In Tokyo to attend the World Bank and International Monetary Fund (IMF)’s annual meetings, Finance Minister Guido Mantega said that the reduction would help contain the renewed appreciatory pressure on the Real from the third round of quantitative easing in the US. Mantega added that the other official measures to dissuade capital inflows had so far proven effective in shielding Brazil’s economy from the global currency war. The ever optimistic minister insisted that the domestic economy was picking up on the back of the Rousseff government’s array of stimulus measures and would be growing at 4.0% year-on-year again by year end.

Mantega, who first coined the term ‘global currency war, also said that the Brics group of developing countries (comprising Brazil, Russia, India, China and South Africa) would meet on the margins of the multilateral meetings to further talks about setting up a emergency currency swap framework, similar to the Chiang Mai Initiative among Asian countries.

Mantega complained that quantitative easing policies had only limited positive effects in the US and Europe, and said that governments should try to stimulate their economies by increasing fiscal spending rather than easing monetary policies. This was later echoed by the IMF’s managing director, Christine Lagarde, who on 10 October warned of the need to loosen fiscal policy in Europe.

It has been widely assumed that President Felipe Calderón was determined to escalate his government’s anti-cartel drive in the remaining months of his tenure, so as to be able to step down with his policy vindicated. Since the 1 July elections he has deployed more troops and federal police to drug-war hotspots, and there have been a number of high-profile captures, but none as impressive as the string carried out in September, which netted much of the top leadership of the Cártel del Golfo (CDG) gang. Just how this, and the reported rifts within Los Zetas, will affect the course of the inter-gang wars, has yet to be seen.

The arrests of leading CDG bosses in September took place in Tamaulipas, long a stronghold of that organisation. Most of the arrests were carried out by the Mexican navy, who has built up a reputation for being far more efficient than the army:

-On 2 September police arrested Comandante Diablo’(David Rosales Guzmán), believed to have been the leading CDG figure in Monterrey and the man leading the fight against Los Zetas in the whole of Nuevo León state.

-On 3 September a navy unit captured ‘El Gordo’ or ‘M1’ (Mario Cárdenas Guillén), brother of two successive CDG heads, Osiel and the late  ‘Tony Tormenta’ (Antonio Ezequiel), believed to have been one of the heads of the Rojos CDG faction, which was engaged in a struggle with the Metros faction led by  ‘El Coss’ (Jorge Eduardo Costilla Sánchez).

-On 12 September a navy unit captured ‘El Coss’. That same day another navy unit captured the reputed leading CDG figure in the south of Tamaulipas, ‘Sierra’ (Gabriel Montes Sermeño).

The CDG, once the most powerful drug-trafficking organisation in Mexico, had been greatly weakened by the defection of Los Zetas, originally hired as a team of ‘enforcers’ who in 2010 set themselves up as an independent organisation, engaging the CDG in a bloody turf war. Several analysts reacted to the recent string of arrests predicting that they would trigger a wave of factional in-fighting, leading to the disappearance of the CDG.

Similar predictions were made in the past about the Tijuana and Juárez gangs, which, though diminished have managed to stay in business. Since its creation in the 1970s the CDG has lost five leaders: its founder Juan García Ábrego, arrested in 1996; Osiel Cárdenas Guillén, arrested in 2003 and extradited to the US in 2007; Tony Tormenta’, killed in 2010;  the recently arrested ‘El Gordo and ‘El Coss’. Up to the time of writing there had been no indication of who might succeed the last two.

What has gained currency, though, is the news that the CDG has struck an alliance with Los Caballeros Templarios (LCT, which splintered from La Familia Michoacana) against Los Zetas. Moreover, on 24 September banners in several cities proclaimed that they had been joined by the reputed Zetas boss in Nuevo Laredo, ‘El Talibán’ or ‘Z-50’ (Iván Velázquez Caballero), who had recently fallen out with number-two Zetas leader ‘Z-40’(Miguel Ángel Treviño).

Velázquez Caballero had publicly accused Treviño of betraying a number of leading Zetas recently arrested by the authorities in much the same language as earlier banners and videos which had been construed as signalling a rift between Treviño and top Zetas leader ‘El Lazca’ or ‘Z-3’ (Heriberto Lazcano) [SSR-12-08]. A late-September banner purportedly signed by Treviño protests his continuing loyalty to Lazcano and derides both the Caballeros Templarios and their LFM enemies, hinting that he is aware that a new anti-Zetas alliance has been formed.

On 27 September a navy unit captured ‘El Talibán’ in San Luis Potosí. Upon his arrest navy sources said he had been the leading Zetas figure in Aguascalientes, Coahuila, Zacatecas and parts of Guanajuato. Given the success the navy has recently had in locating and capturing top gang leaders, this intelligence is worth taking seriously.

Snitching

That a drug-gang boss should be accused of betraying their rivals to the authorities is not a new phenomenon. It has been practiced most assiduously by those organisations that managed to infiltrate the law-enforcement establishment (the defunct Beltrán Leyva gang being the most notorious in this respect). Indeed, much of the intelligence that has led to the capture of prominent members of trafficking organisations has come from anonymous tips presumed to come mainly from rivals, or from confessions of captured narcos seeking leniency. It is hardly surprising that this should be considered heinous behaviour by the drug gangs, and it has often been invoked as the motive for ‘executions’.

A case in point is the exchange of accusations between two gangs that were formed by a split that in 2011 marked the end of the Milenio/Los Valencia: the Cártel Jalisco Nueva Generación (CJNG) led by ‘el Mencho’ (Nemesio Oseguera Cervantes) and La Resistencia, led by ‘El Molca’ (Ramiro Pozos González). The former became associated with the Sinaloa gang, the latter with LFM and the CDG.

In late 2011 the CJNG struck an alliance with Los Zetas to jointly fight against La Resistencia — a turf war responsible for much of the violence recorded in Jalisco. Pozos González publicly accused the CJNG of acting in collusion with state and municipal police, but on 6 September, acting on “information received”, a combined army-police unit located and arrested ‘R-1’ (Ramón Álvarez Ayala), reputed second-in-command of the CJNG, and his brother and lieutenant‘R-2’ (Rafael). Six days later the federal police located and arrested Pozos González.

Setback in Piedras Negras

One of the weaknesses in the Calderón administration’s anti-gang drive is the failure to curb the virtual takeover of prisons by inmates convicted of federal offences (chiefly drug-trafficking and organised crime), with the tolerance and sometimes connivance of wardens and guards. On 17 September there was a massive jailbreak from the prison in Piedras Negras, Coahuila (just across the border from Eagle Pass, Texas): 131 inmates fled some through a deep, 7-metre-long tunnel others reportedly through the main gate. Of these, 86 had been convicted of federal offences.

The warden, watch officer and chief of guards have been remanded in custody and are being investigated to determine if they had any involvement in the escape. Jorge Luis Morán, Coahuila’s public security secretary, has said that Los Zetas are believed to have organised the prison break.

This was the second-biggest jailbreak during Calderón’s term of office. The first, was from the prison in Nuevo Laredo, Tamaulipas, in which 141 inmates escaped.

President Juan Manuel Santos has been true to his promise, revealing details about the upcoming peace talks with the Fuerzas Revolucionarias de Colombia (Farc) little by little. This week, during various public appearances in the US as part of a short visit to attend the 67^th UN General Assembly debate, he made two particularly interesting ones: a) ‘Alfonso Cano’ (Guillermo León Sáenz) contacted his administration as soon as he took office in August 2010 to begin discussing the possibility of an agreement; and b) he is certain the peace process will be completed within the next calendar year.

In a presentation at his Alma Mater, Kansas University, Santos said the contact initiated by the Farc’s top commander put him between a rock and a hard place. “I ordered that we had to chase the leaders of the guerrillas. And I had to make a very difficult decision; we had surrounded this leader [Cano]. What do we do? I said: the rules are the rules; if we want to be successful we have to be clear about the rules of the game and persevere...these decisions were very difficult, but I am sure this [Cano’s killing in a bombing raid in November 2011] is one of the reasons why we are negotiating now”. The revelation, just like other recent developments, once again indicates that the two sides clearly understood that negotiations must continue outside Colombia and despite what happens on the battlefield [WR-12-36].

However, that has not stopped the Farc and some civil society groups in Colombia from calling on the government to accept declaring a ceasefire before negotiations conclude. This week, Colombianos y Colombianas por la Paz sent a public letter to President Santos, ‘Timochenko’ (Rodrigo Londoño Echeverri, the Farc’s top commander) and ‘Gabino’ (Nicolás Rodríguez Bautista, the leader of the Ejército de Liberación Nacional [ELN]), asking them to sign a ‘special agreement’ which, based on international humanitarian law precepts, enables them to establish a tripartite ceasefire while negotiations continue. Neither side has formally responded yet, but Colombian legislation restrains the Santos administration from doing so without meeting certain criteria [RA-12-09].

At the UN, President Santos also hinted that the peace negotiations would be completed quickly, saying that he hoped to return to the UN’s headquarters in New York to “give the assembly a positive report next year” and not simply express his optimism about the end of the conflict. Since announcing that peace negotiations would take place, Santos has repeated that these would be completed within months, a pledge he has now made at the highest level of inter-governmental organisations. However, a successful resolution to the internal conflict will not necessarily translate into an end of violence in Colombia, which is largely fuelled by the income generated through the illicit drugs trade. In this regard, Santos reiterated his call for a comprehensive, global analysis of the current counter-narcotics efforts to decide whether to stay the course, make some adjustments to the present interdiction strategy or consider other alternatives.

In that sense, he delivered on the promise he had made in Kansas a few days earlier, when he said he would ask the UN to undertake a similar study to that currently being carried out by experts on behalf of the Organization of American States (OAS) to assess the feasibility of implementing alternative strategies to the current war on drugs. “I think Colombia has the moral authority to propose the following: Let’s study, evaluate and analyse what the world is doing against drugs and drug-trafficking. The United Nations declared the war on drugs 40 years ago. Let’s consider if what we are doing is the best that we can do,” Santos stated in Kansas. “This is something Colombia cannot do on its own. No country can do this on its own. It must be a joint effort, an international decision”.

• The ‘alternative’ three musketeers

President Santos was not alone; Guatemala’s Otto Pérez Molina and Mexico’s Felipe Calderón also called for a similar evaluation of the war on drugs. Pérez Molina said his government “would like to establish an international group of countries that are well disposed to reforming global policies on drugs” and would consider “new creative and innovative alternatives”. Calderón made a similar call at the UN and earlier this week at the Council on Foreign Relations in Washington, in which he said “The best way to do this would be to reduce demand for illicit drugs in the US, but frankly, if this is not possible, alternative solutions to reduce the massive profits of criminal organisations must be considered, and that includes market alternatives”.

Ecuador’s private sector is putting pressure on President Rafael Correa to make a concerted effort to improve trade relations with the US for fear that his decision to grant diplomatic asylum to Julian Assange, the founder of the whistle-blowing website WikiLeaks, will have negative repercussions. Specifically, the private sector is fretting that the US will terminate Ecuador’s trade privileges under the Andean Trade Promotion and Drug Eradication Act (Atpdea).

The Correa administration granted diplomatic asylum (on 16 August) to Julian Assange, who had sought refuge in the Ecuadorean embassy in London on 19 June, after losing his legal battle to avoid extradition to Sweden to face an investigation into allegations of sexual assault. Ecuador’s foreign minister, Ricardo Patiño, read a long statement justifying the decision. He argued that “Ecuador believes that he [Assange] may become a victim of political persecution, as a result of his dedicated defence of freedom of expression… as well as his repudiation of the abuses of power in certain countries.”

Patiño argued that there was “strong evidence of retaliation by the country or countries that produced the information disclosed by Mr. Assange… that may endanger his safety, integrity, and even his life”. In case there were any doubts as to which “country or countries” Patiño might be referring, he grew more specific. He went on to impugn the US justice system by arguing that “legal evidence clearly shows that, given an extradition to the United States of America, it would be unlikely for Mr. Assange to receive a fair trial, and likely that he would be judged by special or military courts, where there is a high probability of suffering cruel and degrading treatment, and be sentenced to life imprisonment or capital punishment, which would violate his human rights”. He added that from “public statements and diplomatic communications by officials from Britain, Sweden and the USA, it is inferred that these governments would not respect international conventions and treaties…”

On 22 August the Washington Post ran an editorial contending that Correa was taking a big gamble on Assange that could backfire: “Mr. Correa — who has cracked down on press freedoms in his own country — has begun to show signs of establishing the same sort of autocracy that Hugo Chavez [sic] has brought to Venezuela”, the editorial argued. “He may imagine that protecting Mr. Assange will give a much-needed boost to his international reputation. But it also could have disastrous economic consequences for his country. As we’ve said before, the United States that Mr. Correa so despises allows Ecuador to export many goods duty-free, supports roughly 400,000 jobs in a country of 14 million people and accounts for one-third of Ecuador’s foreign sales. Congress could easily decide to diminish that privileged commercial access early next year. Is Mr. Assange really worth the risk?”

‘Definitely not’ was the resounding response from Ecuador’s private sector. In a meeting with President Correa and his cabinet ministers and some 150 businessmen shortly after the publication of this editorial, Pablo Dávila, the president of the umbrella business association Comité Empresarial Ecuatoriano (CEE), expressed his concern that “recent events that we have been through, particularly the asylum granted to Julian Assange, show without doubt that there is going to be an impact on trade ties.” He called for the adoption of a “strategy reaching out to that [the US] market”.

Correa shot back that “if national sovereignty is at stake, we will leave the negotiation table”. He added: “In February [17^th] we will have new elections; if I stand for re-election let me make it clear, I will never accept any form of blackmail... Let them keep their Atpdea, we will give them a few million for a course in ethics and human rights.”

Correa said it would be an absurd contradiction if the US Congress refused to extend trade preferences because of the asylum granted to Assange. Ecuador alone enjoys Atpdea privileges now, as both Colombia and Peru have Free Trade Agreements (FTA) with the US and Bolivia was suspended from the agreement back in 2008 after a diplomatic rift with the US. The Atpdea preferences are due to expire in July 2013 and there is absolutely no chance, unless Correa somehow contrives to lose next February’s elections, that Ecuador would pursue an FTA of its own with the US.

In the past, Correa has repeatedly stressed that he “will not beg” the US for an extension of Atpdea. He argues that Atpdea is not a gift from the US, but the corollary of a contract under which the Andean countries stepped up their fight against the drug trade in their territories.

Broccoli: a brief case study

A number of key export products, such as cut flowers and vacuum-packed tuna, benefit from Atpdea. Other exports are highly dependent on Atpdea. It is worth focusing on just one of these, for instance broccoli, to demonstrate the extent of the repercussions on Ecuador should Atpdea not be extended.

Currently, 97% of Ecuador’s broccoli production is exported, of which one-third goes to the US in frozen form. Ecuador’s annual broccoli exports to the US are in the region of US$20m. This is a substantial sum as the producers of the crop are almost all monoculturists. The production and processing of broccoli provides employment for more than 12,000 people in the indigenous central Sierra provinces of Cotopaxi, Pichincha, Imbabura, Carchi and Chimborazo.

The association of Ecuadorean producers of fruit and vegetables (Aprofel) calculates that if the 0% tariff enjoyed under Atpdea prevails, then broccoli exports to the US will continue to grow at their current rate of 15% a year to reach US$40m within the next five years. On the other hand, Aprofel calculates that if broccoli exports were suddenly subjected to an import tariff of 15%, exports to the US would fall by nearly 30% a year, leading to the loss of more than 1,000 jobs a year.

The US would probably increase imports from Mexico, which is a big producer, and also (rubbing salt into the wounds of local producers) Colombia, whose producers are benefitting from the newly signed FTA with the US and are no longer subjected to the anxiety surrounding the periodic Atpdea renewal debate.

Off to Washington

A commission comprising representatives of the Ecuadorean-American Chamber of Commerce will travel to Washington in October to meet members of congress opposed to the extension of Atpdea. The comments made by Foreign Minister Patiño about the US justice system while granting Assange asylum are not likely to predispose congressmen to extending the Atpdea preferences.

This is particularly true when the prevailing perception in the US Congress is that the Correa administration’s entire foreign policy stance is almost tailor-made to aggravate the US, while providing Ecuador with little of real worth other than the knowledge that it enjoys full and unfettered national sovereignty to chart its own diplomatic course - Correa’s decision to invite Iran’s Mahmoud Ahmadinejad onto the balcony of the Carondelet presidential palace last January, and more recently Ecuador’s decision in late May to abstain from a UN Human Rights Council (UNHRC) resolution condemning the Syrian government over the massacre of civilians in Houla, stand out.

• Freedom of expression

“When the emblem of freedom of expression par excellence, Julian Assange, asks for asylum in this country… [it] is the best response to so much false propaganda that we restrict freedom of expression”, President Correa said. By defending Assange, Correa can also wave aloft an anti-imperialist banner, portraying himself as a genuine leftist. No serious rival has emerged to challenge him in the February presidential election, but the main political threat unquestionably comes from former allies who argue that he has deserted his left-wing roots.

• Belarus

Intriguingly, days after Ecuador granted asylum to Julian Assange, a judge on the national court of justice rejected an extradition request from Belarus for a former police investigator who had been jailed since June. Aliaksandr Barankov, much like Assange, had argued that he could be killed if he were sent back to Belarus. The case was being touted as a sign of the Ecuadorean government’s consistency on human rights given that President Correa has established close ties with Belarussian President Alexander Lukashenko, who has earned the sobriquet ‘Europe’s last dictator’.

Those who trawl through left-leaning online news sites and blogs will have noticed the emergence of a new wave of stories about secret US bases across Latin America and hidden agendas behind the ‘small footprint’ US military cooperation activities in the region. One item has been absent: the very overt involvement of the US military in a joint operation with the Guatemalan armed forces, inside Guatemala, against drug traffickers.

It was left to the Guatemalan authorities to announce that 171 US Marines would be deployed next to Guatemala’s three armed services in a joint operation against drug traffickers acting along the country’s Pacific coast. This represents an extension into Guatemala of Operación Martillo, a multinational drive launched in February against transnational criminal activities in Central American coastal waters, headed by the US Southern Command’s Joint Interagency Task Force-South (JIATF-S).

On 20 August President Otto Pérez Molina said that the Marines had arrived in Guatemala two weeks earlier, and that the ‘strategic command posts’ of the operation would be installed in the Guatemalan navy’s Pacific base at Puerto Quetzal and the parachute brigade’s base at Puerto San José (both in Escuintla).

He explained that when Operación Martillo began in Honduras in the first months of 2012, the traffickers that had been operating in the Gulf of Honduras changed their routes and began to send their shipments to Guatemala’s southern coast. Evidence began to appear several months ago, he said, that shipments of cocaine were being transferred off the Pacific coast to smaller coastal craft for landing, then sent overland to Mexico.

US Southern Command (Southcom) announced this development in its blog Diálogo by running, without commentary, a report by the news agency AFP.

Defence minister Ulises Anzueto expanded on the President’s announcement and was reported by AFP as stating that about 2,000 members of the Guatemalan military would take part in the joint operation, which is planned to last 120 days, with the possibility, depending on results, of an extension for another 120. The newswire Efe however quoted Erick Escobedo, the defence ministry spokesman, as saying that just 250 Guatemalan soldiers would be taking part. The US contingent (which includes civilian employees as well as Marines) will be stationed at Guatemala’s southern air command in Retalhuleu, the central air command in the capital and the base of the parachute brigade. The joint operation will cover the six departments along Guatemala’s Pacific coast (though it will begin later in San Marcos, which abuts Mexico, because of delays in the arrival of communications equipment and other technical snags).

So far Operación Martillo has involved the participation of 11 countries: the US, Colombia, Mexico, Guatemala, Honduras, Panama, Great Britain, France, Spain, the Netherlands and Canada

■ Just before President Pérez Molina’s announcement of the joint operation, interior minister, Mauricio López Bonilla, announced that Guatemala has become a cocaine producer, on the strength of the discovery of a shipment of 17.6 tonnes of cocaine paste, presumably for local processing.

What started off as criticism of President Sebastián Piñera for politicising poverty ahead of October’s municipal elections has taken on a whole new dimension over the course of the past week. At stake is something far more important than a short-term political gain: Chile’s institutional integrity.

When Piñera trumpeted his government’s achievements in reducing poverty after the publication of the triennial socio-economic characterisation report (Casen) in July, the leftist opposition Concertaciόn accused him of “seeking popularity at the expense of the poorest” and trying to boost his ruling right-wing coalition ahead of the municipal elections [WR-12-29]. Last week the criticism took on a more sinister form. The Piñera administration was accused of applying pressure on the UN Economic Commission for Latin America and the Caribbean (Eclac), which worked with the social development ministry (MDS) to produce the Casen, to revise the poverty figure downwards. Two officials involved with the Casen report resigned.

The Casen was published on 20 July. It showed that poverty had fallen from 15.1% in 2009 to 14.4% in 2012. The Piñera administration took some pleasure in goading the Concertaciόn, which had presided over a slight increase in poverty in the previous Casen, by presenting this as a major success. Implicit in its presentation of the report was the suggestion that the Concertaciόn did not have a monopoly on social justice. The result also lent credence to the Piñera administration’s claims that it was meeting its development goals.

The Concertaciόn took exception to what it decried as triumphalism and questioned why the figures were not accompanied with details of the technical data used in the survey and the margin of error (much the same as the apparent decrease). At the time this sounded rather like sour grapes, but after former finance minister Andrés Velasco and a group of 30 economists questioned the methodology employed in the Casen, the online Chilean research and information centre focused on reporting and investigative journalism (Ciper) reported on 31 August that Eclac had presented the MDS with a first report showing poverty of 15%. Eclac apparently revised this down to 14.4% after the MDS suggested that it incorporate another variable to its calculations.

Andrés Hernando, the economist heading the MDS research team working on the Casen, resigned on 31 August. “The night before the announcement [of the figures] … I said that the changes were not significant. I thought then that the communication of the results [by the government] would be reasonable, rather than the hype that they were given.” He told Ciper, however, that “the survey was not manipulated in any way. On that I am emphatic. What was inappropriate was using the results of a key instrument in the design of social policies for political ends.” Juan Carlos Feres, head of the social statistics unit at Eclac in charge of working with the MDS to produce the Casen, also resigned. Feres denied that La Moneda had applied any pressure on him to revise down the poverty figure. Eclac said that it would reconsider its future cooperation with Chile to produce the Casen because of damage to its image.

This appears to have given the Concertaciόn pause. It dropped shrill cries of “the scandalous Casen-Gate”, and calls to establish an investigative commission, amid concern that Chile’s regionally revered institutions could lose their reputation, suffering the same loss of credibility as in Argentina, where official figures bear little relation to reality. The government spokesman, Andrés Chadwick, also promised a political debate over whether there really had been a fall in poverty.

A car carrying US diplomatic plates came under sustained fire from federal police (PF) officers in the south-central state of Morelos on 24 August. Two US officials travelling in the vehicle were injured, and a Mexican navy captain was largely unscathed. At this point the facts of the incident give way to speculation. The identity of the US officials, for instance, is unclear, as is precisely what they were doing in Mexico, and why they came under attack. Without clearing up these issues, President Felipe Calderόn apologised in public to US ambassador Anthony Wayne four days later.

The car apparently refused to stop for federal police officers, who were neither in uniform nor in marked cars, waving it down. They responded by opening fire and as the car made its escape it was pursued by several other vehicles. A Mexican judge ordered the preventative arrest for 40 days of 12 federal police officers involved in the incident, at the request of the attorney general’s office (PGR).

Extra-official sources from the PGR this week put out that the two US officials injured in the attack on the car in Morelos were in fact agents of the Central Intelligence Agency (CIA) who were visiting a military training centre, El Capulín, on the border between Morelos and the Estado de México. This followed a claim by Mexico’s news magazine Proceso, citing an anonymous source, that the men were actually members of the Drug Enforcement Administration (DEA) assisting the navy in tracking down Héctor Beltrán Leyva, the leader of the eponymous drug trafficking organisation (DTO) - and that a fourth man, an informer, was also in the car. The US authorities declined to reveal the identities of the officials beyond saying they worked in law enforcement.

The navy issued an odd statement about the incident in which it pointed out that the navy captain in the car was not driving but was on the back seat making calls from his mobile phone seeking help. It might have felt compelled to dissociate itself completely from any involvement. The navy has a productive working relationship with US security personnel, while its working relations with the PF are increasingly strained.

Opening a forum on public security at the national anthropology museum in the presence of Ambassador Wayne on 28 August, President Calderón said the violent incident was unacceptable and that the PGR would conduct a thorough investigation to get to the bottom of it. “Be it from negligence, lack of training, lack of trust, complicity, these acts cannot be permitted and they are being investigated absolutely rigorously,” he said, while thanking Wayne for the help the US is providing through the Mérida initiative to combat organised crime.

The mayor of the Distrito Federal (DF), Marcelo Ebrard, decried the fact that the whole incident was shrouded in mystery. He expressed greater interest in clarifying what the US officials were doing in Mexico, however, than clearing up the motive for the violence. “Is there some agreement signed between Mexico and the US that allows the CIA to carry out operations in Mexico? This is very sensitive,” he said, adding that it was not envisaged in the Mérida initiative and fell outside the margin of the constitution and Mexican law. Ebrard said it was incumbent on the senate, which will start a new session on 1 September, to investigate and to inform Mexicans “what agreement there is with the US, how far it stretches and with which agencies.”

Development: On 17 August the central bank reported that real GDP rose 5.6% year-on-year in the first half of 2012.

Significance: There is no mystery to the results. Thanks to sky-high oil prices, the government is spending hand over foot to ensure the October re-election (for a third consecutive six-year term) of President Hugo Chávez. Imports soared 27% year-on-year in the first half, to just over US$27bn, and supplied fully a third (33%) of the total domestic offer, the highest such proportion in 16 years. Oil accounted for 96% of total exports, generating a whopping US$47bn in revenues. Yet flush export earnings (plus decent tax revenues) were not enough - the government also issued debt to the tune of US$16bn between January and June. Local economists project the 2012 fiscal deficit at a record 15% of GDP. What goes up must come down - and the consensus is for a hard landing next year. Devaluation is expected come early 2013, as per the typical Chavista post electoral strategy.

More notably, the oil sector itself posted real annual growth of just 1.0% in the first half. Between 1998 and 2011, real growth in the oil sector averaged just 1.2% a year. If the Bolivarian Revolution is to survive and prosper, the government urgently needs to ramp-up production.

Key points:

• Total external debt is still emminently manageable at US$91.7bn, or 29% of GDP, but domestic debt has soared to US$57bn on some estimates, propelling total public debt to a projected 47% of GDP by end-2012.  Again, that’s nothing in comparison to the US or the bankrupt peripheral Eurozone countries. But there is no question now that Venezuela needs not just sustained high oil prices, but also high-volume sales. Worryingly, despite tens of billions of dollars in Chinese investment in the oil sector in lucrative cash-for-oil deals, there is no sign of significant additional production coming on stream any time soon. Output was 3.0m barrels per day (bpd) in the first half of 2012, according to the energy minister and president of Venezuela’s state oil company, Petróleos de Venezuela (Pdvsa), Rafael Rodríguez. Brazil is now producing more oil than Venezuela.  The government’s target is to reach some 5.1m bpd by 2019-2020.

• President Chávez on Saturday (18 August) said that Pdvsa would transfer shares from Petropiar, a joint venture with the US-based Chevron, to the troubled state miner Corporación Venezolana de Guayana (CVG) so as to form a new oil company to be known as Petro San Félix. Speaking in Guayana, he pledged an industrial development axis in the state, centred on the giant Orinoco oil belt (home to the largest land-based oil reserves in the world), focusing on mining, agriculture, industry and petrochemicals, under his next government (2013-2019). The mining sector has stagnated under Chávez (it fell 4.8% in the first half of 2012) and CVG has also been plagued by labour unrest, with Chavista and non-Chavista unions coming together against the central Caracas government.  In late July workers re-elected an opposition trade unionist, Rubén González, to the helm of the Sindicato de Ferrominera del Orinoco (SintraFerrominera).  Three unions in Guayana are opposition controlled, SintraFerrominera, CVG Carbonorco and CVH Alcasa.

• Chávez also announced a new tie up between Pdvsa and Siderurgica del Orinoco ‘Alfredo Maneiro’ (Sidor), to be known as Faja-Acero, the aim of which is to produce up to 1.0m tonnes of steel a year, generating US$3.5bn a year for Sidor, according to the president. Chávez also promised a US$300m electricity transmission line, along with three new substations, between El Guri and Ciudad Bolívar. “The Revolution is a sequence of new births”, Chávez declared, adding, “on 7 October we will deliver a knockout to the bourgeoisie…we are heading for 80% of the votes”.

• Upstream industrialisation towards petrochemicals and other value-added sectors is all well and good — it is also the strategy in Brazil, for instance. The problem in Venezuela’s case is one of implementation. Having gutted Pdvsa of its professional workers and managers following a crippling oil strike in late 2003, the Chávez government has struggled to replace them with similarly qualified ‘Bolivarian’ staff. Despite record oil prices, Pdvsa has also been starved of cash, with a massive chunk of its earnings siphoned off for social spending; and been asked to deliver for the government on a string on non-oil fronts, from agriculture to housing.

Pointer: The construction sector, now accounting for 7.2% of GDP, rose 7.5% year-on-year in the first half. Within manufacturing, non-metallic minerals output contracted 11.2%, while food, drink and tobacco fell 9.4%. The Marxist finance minister, Jorge Giordani, insisted on 18 August that the current pace of growth is sustainable and projected average growth of 6.0% in 2013-2019. He celebrated the fall in annual inflation to below 20% (19.4% in July).