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La facción gobernante del Partido Justicialista (PJ, Peronista) aprovecha la confusión y la dispersión de la oposición para una gran apuesta polí­tica: la actual senadora Cristina Fernández, esposa del Presidente Néstor Kirchner, como su candidata presidencial en las elecciones de octubre, incluso aunque las encuestas sugieren que el Presidente puede ser una apuesta más segura contra los contendientes existentes.

El 24 de febrero trascendió a los medios (off the record), que un equipo liderado por Carlos Zunnini, secretario legal y técnico de la presidencia, habí­a comenzado a trabajar en un anteproyecto de campaña con Fernández como candidata. Ese mismo dí­a, en un mitin en las afueras de Buenos Aires, varios funcionarios de alto rango y lí­deres del partido, incluido el Vicepresidente Daniel Scioli y el ministro de educación Daniel Filmus (candidato de Kirchner para encabezar el gobierno del autónomo distrito metropolitano), expresaron abiertamente su apoyo a la nominación de Fernández.

Dos encuestas de opinión difundidas casi simultáneamente con esos eventos, muestran a Fernández atrayendo 37% de los votos, diez puntos más que su más cercano rival. Sin embargo, una de esas encuestas, de Ipsos Mora y Araujo, con una alineación hipotética, con Kirchner como candidato del partido de gobierno. Lo muestra atrayendo 52% de los votos, no menos de 44 puntos más que su más cercano contendiente. La otra encuesta, conducida por Julio Aurelio para probar el apoyo a cuatro polí­ticos percibidos como los más fuertes presidenciables, muestra al ex ministro de economí­a Roberto Lavagna -el hombre responsable de sacar a la Argentina de la depresión de 2001-02- en segundo lugar, apenas debajo de 21% de las preferencias.

Sin embargo, la alineación hipotética en esos sondeos, ya comenzaron a cambiar. El empresario, presidente de un club de fútbol y diputado, Mauricio Macri, ya no está en la contienda: ha optado por intentar de nuevo por la gobernación del distrito metropolitano de Buenos Aires (que perdió en segunda ronda en 2003). Eso dejó el campo libre para que su aliado polí­tico, Ricardo López Murphy, pueda anunciar si competirá por la presidencia. Compromiso para el Cambio, el partido de Macri, concretó una alianza con el de López Murphy, Recrear, en octubre de 2005 y crearon Propuesta Republicana (PRO).

El PRO se presenta como la alternativa de derecha al tipo de estatismo enlazado con la retórica de centro-izquierda de Kirchner. Sostiene que la polí­tica de alto crecimiento seguida hasta ahora es insostenible, su punto débil es el alza de la inflación, que el gobierno intenta disfrazar, y la escasez de inversiones, en especial del exterior. También critica fuertemente la cercaní­a de Kirchner con el Presidente venezolano Hugo Chávez .

López Murphy, cuyo enfoque "neoliberal" de la polí­tica económica no pasó la prueba cuando fue ministro de economí­a bajo Fernando de la Rúa (1999-2001), abandonó la Unión Cí­vica Radical (UCR) y compitió por la presidencia en 2003. Llegó tercero, con 16,3% de los votos.

En esas elecciones, Kirchner obtuvo 22,2% de los votos -la más baja porción de votos válidos jamás obtenidos por un candidato ganador. En realidad, él llegó segundo, detrás de otro Peronista, Carlos Menem, que logró atraer 24,4% de los votos. Menem decidió no presentarse en la segunda ronda, cuando se hizo evidente que el resto de los votos Peronistas sumado al de los votos de los partidos y grupos de centro-izquierda, serí­an para Kirchner.

El riesgo de Kirchner al llevar a Fernández, es que ella podrí­a no ganar en la primera ronda. En verdad, hay una fuerte posibilidad que la contienda se decante en tres, con Lavagna y López Murphy como más cercanos rivales de Fernández. Si ese resulta ser el caso, la gran pregunta es hacia quién se inclinarán los indecisos (que llegan a 21% en el sondeo de Ipsos-Mora y Araujo).

Eso podrí­a ser influenciado principalmente por la campaña negativa. Es posible que Fernández y López Murphy se ataquen uno a otro, retratando la elección como una contienda entre el "populismo radical" y el "neoliberalismo salvaje". Lavagna podrí­a beneficiarse de eso, a lo sumo, es probable que lo peor que digan sus rivales de él es que sirve a los intereses de la derecha (es la visión del campo de gobierno) o que es una versión suave del dirigismo de Kirchner (es la visión de la derecha).

Lavagna disfruta del apoyo de algunos Peronistas y la porción de la UCR que no aceptó la oferta de concertación de Kirchner. Este último campo incluye a cuatro gobernadores provinciales y un número de miembros de la UCR. El campo de Kirchner está considerando seriamente la nominación del gobernador de Mendoza, Julio Cobos, de la UCR, como compañero de fórmula de Fernández, como medio de atraer a más seguidores de la UCR. En la centro-izquierda, pende un interrogante sobre cómo se alineará Elisa Carrió (otra desertora de la UCR), que ha venido atrayendo entre 5% y 12% de las preferencias: ella podrí­a volcarse hacia Fernández o Lavagna. El gobernador de Neuquén, Jorge Sobisch (que atrae 3%), por otro lado, puede inclinarse en cualquier dirección.

Lo que mostran las encuestas
% de las preferencias de los votantes
Candidato	Ipsos Mora y Araujo, 14 de enero	Ipsos Mora y Araujo, 14 de enero	Julio Aurelio, 14 de enero
Nestor Kirchner	52	-	-
Cristina Fernandez	-	37	36.5
Mauricio Macri	8	9	15.2
Roberto Lavagna	5	6	20.7
Elisa Carrio	5	6	12.1
Carlos Menem	3	3	-
Jorge Sobisch	3	3	-
Otros	10	15	-
Indecisos/ninguno	14	21	10.4

President Nicanor Duarte claimed that tax revenues had increased sharply, sometimes by over 100%, thanks to his government's clampdown on corruption and evasion. Duarte pointed out that he had been in office for only a month, but was already making a difference. His finance minister, Dionisio Borda, claimed that the daily tax take was running at about 37bn guaraní­es (US$6m), whereas traditionally it had been between 7bn and 8bn guaraní­es.  

Significantly, the government claims that its revenues from customs duties have increased considerably since it removed tax officers from roads and border crossing posts.  

Duarte argues that the country is starting to get a conscience about paying taxes. Traditionally, the government reckoned that it was doing well if it collected as much as 40% of the taxes it was due. The new government has said that it will offer an amnesty until the end of the year so that people can get up to date with their taxes without incurring penalties.  

The government is desperate to make progress on tax. It inherited an administration which was, almost literally, bankrupt. The government had to raid those bits of the public sector that still have cash or credit to meet salaries. The IMF reckons that the government's expenditure will exceed its income by US$158m this year.  

It seems almost inevitable that the new government will have to thin out the public sector. Around 200,000 people (of a population of 4.5m) work for the government in one form or another.

Corruption
The public works minister, José Alberto Alderete, said that he has received death threats after ordering an audit of the companies and businesses under his control. The main focus of the audit will be the companies that collect tolls and those that handle repairs and maintenance for the ministry.

Inflation in the first five months of the year came to 5.1%. This is what the government expected for the whole of 2004.

The central bank blames the high price of oil for the overshoot. Although oil prices have fallen slightly in the second half of June, they are still volatile. Local economists say that if oil prices remain around current levels, the country will have inflation of at least 8% this year. 

The government said that it paid an average of US$35.65 per barrel of oil in the first five months. In the same period of 2003 it was paying US$31.55 per barrel. Economists are also beginning to fret about growth. The government is hoping for 3.6% growth this year: most economists are nudging their forecasts down.

Coffee prices have surged this year. By March, the International Coffee Organization was pointing out that prices for other milds, the most important reference price of Central American coffee growers, was 50% higher than the average for 2004. 

The prices of two other important categories of coffee, Colombian milds and Brazilian naturals, did almost as well. Colombian milds are traditionally the market's top quality coffee, trading at a premium to all but specialist arabicas (such as those which are organically produced or from a special area or estate). The average price of Colombian milds in February 2005 was 49% higher than the average price for 2004, while the February average for Brazilian naturals was were 53% higher than the average for 2004.

The main reason for the surge in prices is the growing realisation that demand for coffee is likely to outstrip supply by about 8m (60kg) bags in 2004/05. The coffee year runs from October to September. The prospect of higher coffee prices, reflecting the shortfall, has prompted speculators to pay more attention to the market. Coffee is traditionally the world's second-most heavily traded commodity after oil. 

In 2004 demand for coffee was estimated by the ICO at just over 113m (60kg) bags. The ICO is now revising that figure and notes that independent analysts suggested that a more accurate figure for consumption is 117m bags.

For 2004/05 the ICO is forecasting that the world coffee crop will be about 106m bags. The big unknown is the size of the Brazilian crop. The ICO is forecasting that the crop will come in at 38.2m (60kg) bags. This forecast is towards the top end of expectations and about a third higher than the crop last year. 

Colombia: The floor price of coffee was set at Col$600,875 (US$257.4) a carga (US$125kg). This was the highest dollar price for seven years. The floor price is linked to the New York price. The intervention price has risen by just under 80% over the past 12 months. The highest-ever intervention price (in dollar terms) was US$259 per carga in April 1998. 

The economy grew by 9.4% in 2005, according to figures from the central bank. In 2004, the economy grew by 17.3%. The bank said that the 2005 growth was due to the strength of domestic demand.

Domestic consumption was up by 14.4%, largely because of buoyant oil export revenues, government spending, the growing availability of credit and lower unemployment. The unemployment rate in December 2005 was 8.9%, 6.6 percentage points below the rate 12 months earlier.

The bank said that 70% of the growth in 2005 came from the non-oil private sector. There is, the bank reported, less unemployment, lower inflation and a surplus in the balance of payments of US$4.98bn. It said that reserves at the end of 2005 were US$29bn.

The central bank is forecasting 5% growth in 2006 and 10% inflation.

Inflation: The inflation rate in 2005 was 14.4%. In 2004 it had been 19.2%, the central bank noted. In December the monthly rate was 0.8%, down slightly on November's 1.1%. The government has fixed the prices of 110 staple foods, household items and services since 2003. The government's critics claim that the low official price means that there is sometimes no supply of these products away from the black market. Officially, the index for prices of controlled goods and services was up by 0.5% in December. The index for goods and services not subject to price controls was up by 1.1% in December. Overall, there was a 10.6% rise in the index of price-controlled goods and services. The index for the prices of other (ie not price controlled) goods and services was up by 18%. The overall fall in inflation in 2005 was also helped by the one percentage point cut in the Value Added Tax rate.

Unemployment: The unemployment rate fell by 6.6 percentage points to 8.9% between December 2004 and December 2005, the official Instituto Nacional de Estadí­sticas reported. Despite the fall in unemployment there are still over 1m people who are unemployed. The INE is forecasting that unemployment will fall by another percentage point in 2006.

Public sector pay: The government's bloated oil revenue is allowing it to increase public sector workers' pay by up to six times the inflation rate. President Hugo Chávez , who faces re-election at the end of this year, said on 16 January that he would increase pay for up to 1m government workers by up to 80%. The government expects the salary increases to cost B$2.5 trillion (US$1.2bn). The 2006 wage increase is three times what he awarded civil servants in 2005.

Government spending: In the first 10 months of 2005, total government spending increased by 38%.

The government's reaction to a confrontation between cooperative and private sector miners at Posokoni at Huanuni was to announce that the mining industry would be nationalised. The confrontation over two days left 16 people dead. The confrontation also led to a change of command at the mining ministry: Guillermo Dalence, replaced Walter Villaroel, himself a former leader of the national federation of cooperative miners. Dalence made his career in the miners' union.

The confrontation at Huanuni was the product of the way mining assets were privatised by President Gonzalo Sánchez de Lozada who had personal interests in the industry through his company Comsur. Technically, Huanuni was sold, under pressure from the IMF, to Allied Deals, a company which turned out to be entirely fraudulent, in the late 1990s. When Allied Deals collapsed in 2002, the workers at Huanuni reconstituted what had been a state company as Empresa Huanuni. Technically, the Huanuni asset should have been available to Allied Deals' creditors. Instead the company was taken over by the government and then run by the Central Obrera Boliviana. It racked up considerable profits. Between 2002 and 2006 the company had operating profits of US$96m and net profits of US$27m.  

The problem at Huanuni was that both cooperative and commercial mining companies were working the same deposit. The confrontation had been brewing for the past seven months as more of the deposit was mined. The commercial miners working for Empresa Minera Huanuni while the cooperatives were grouped in several competing groups: Playa Verde; La Salvadora; K'arazapato; and Nativas Libres. All the cooperatives belong to the Federacion de Cooperativas Mineras de Huanuni.  

The political weight of the Federación, led by Villaroel before he joined the Morales administration as mining minister, encouraged more people to join the cooperatives. By this year, there were around 4,000 people working in the cooperatives in Huanani. The cooperatives started to demand a bigger share of Poskoni deposit: this would have prejudiced the miners working for the company.  

Huanuni is Bolivia's main tin producing district and the Posokoni deposit is one of the richest tin deposits in the world. It probably holds 948,000t of tin worth around US$4bn. The company, which is working the deeper seams of ore, is producing between 500 and 600t of tin a month. This is a significant amount of money: tin prices jumped from US$4,890 per tonne in 2003 to US$7,385 in 2005. This year the price has topped US$10,350 a tonne.

The inflation rate for the 12 months to July 2007 was 6.98%. This is perilously close to the government's forecast of an inflation rate of 7.3% for the whole of 2007.

The inflation rate is also well above the rate for Central America. The rate for the isthmus for the 12 months ending June was 6.1%. This was down on the 8.6% recorded for the 12 months to June 2006.

Economists polled by the Banco Central de Nicaragua (BCN) now forecast that inflation will be above 10% for 2007.

The central bank said that the main reason for the pick up in inflation was the rise in food prices in the first seven months of 2007. This was largely down to seasonal factors, though there may be some structural changes as well. The seasonal factors are that June and July are the between-harvest months when stocks from the old harvest are low and the new crop has yet to be picked.

On the structural side, however, the central bank noted that the price of maize for tortillas had jumped from an average of 120 córdobas per quintal (100lbs) in January 2007 to 300 córdobas at the beginning of August. The international price of maize has been driven up by the demand for biofuels. On top of this, the rise in oil prices led to a surge in fuel prices. This affected everything from bus fares to the prices of processed foods (such as tortillas) which have to be distributed across the country. The rise in fuel prices will affect staple foods such as beans, sugar, meat, cooking oil and eggs.

A third factor in driving up prices is the energy crisis. The power cuts have affected small businesses disproportionately, which has led to them being unable to produce goods. This, in turn, has led to other producers being able to charge higher prices.

Beans: The surge in the international price of beans has prompted farmers to sell more for export, stripping the domestic market. Bean exports to Honduras and El Salvador have been noticeably higher this year. This has led to the domestic price rising from six to nine córdobas a pound.

Total exports: These rose by 20% year-on-year in the first seven months of 2007 to US$752m. The country's biggest export is coffee, even though production is falling. Coffee exports were worth US$126m in the first seven months of 2007, down from US$155m in the same period of 2006. Beef exports, however rose to US$105m from US$79m in the first seven months of 2006. In 2006 exports came to US$1.07bn. The government's export targets are: US$1.1bn in 2007; US$1.22bn in 2008 and US$1.37bn in2009.

Free zone exports: Free zone exports increased by 23% in the first half of 2007 compared with the same period of 2006, according to the Cororación de Zonas Francas. It said that exports amounted to US$530m, compared with US$409m in the first half of 2006. The value added of these exports was US$159m, up from US$123m in the first half of 2006. The CZF expects free zone exports to top US$1bn this year and the value added to be worth US$320m.

Oil prices: The Consejo Monetario Centroamericano (CMCA) has forecast that if crude oil prices stay over US$75 a barrel, Central America's inflation will rise by 1.3 percentage points.

Power supply: On 2 August, a partial agreement was signed between the Nicaraguan government and the Spanish trans-national company, Unión Fenosa, to solve the energy crisis. Unión Fenosa has been responsible for distributing the bulk of the country's electricity since the privatisation of the industry in 2000 and has been accused by the Nicaraguan authorities of providing a poor quality service, resulting in daily black-outs which have lasted up to eight hours.

Iran: Iran's deputy energy minister, Hamid Chitchian, met President Daniel Ortega on 1 August to discuss the possibility of constructing a hydroelectric plant which could generate some 68 MW. The discussion formed part of more general talks between Iran and Nicaragua over possible Iranian investment in Nicaragua's energy sector.

Despite the surge in inflation, the central bank has not raised interest rates. At its latest meeting on 18 June, the monetary policy committee decided to keep rates at 6.75%. It last raised rates in March.

The bank claimed that inflationary pressures were abating and that demand was faltering. The bank said that demand for credit was waning and that the government was continuing to run a fiscal surplus. The bank's president, Maria Antonieta de Bonilla, pointed out that private sector credit was beginning to ease off, according to central bank data. Money supply growth, partly as a result, was also beginning to slowdown. Broad money growth is now rising at around 9.5%.

The fiscal surplus in the first five months of the year was Q$1.575bn (US$201m).

It also noted that the economic growth rate appeared to be slowing down. Its indicator showed that the economy was running at a growth rate of about 4.5% a year in May. In January 2007 the economy was growing at a 7% annual clip.

The bank covered itself by arguing that the international outlook was constantly changing and implying that changes in commodity prices would have more effect on inflation than anything it did.

The upswing in inflation means, however, that base interest rates in the country are still heavily negative in real terms.  

Inflation: The rate in May was 1.43%, much the same as April's 1.4%. This brought the rate for the first five months to 5.8% and the rate for the past 12 to 12.24%. In 2007 the rate was 8.75%.

On 20 April the finance minister, Marí­a Elas Viteri, offered bondholders 30% of face value to pay off defaulted debts.

The government, whose central bank reserves have fallen from US$6.4bn in September 2008 to US$2.9bn on 17 April 2009, is prepared to spend US$963m on buying back the defaulted 2012 and 2030 bonds.

Viteri said that the country would pay cash to bondholders, but did not say where the money would come from. She specifically ruled out borrowing from multilaterals since, under the constitution, all foreign borrowing has to be for productive purposes.

The government said that the buy-back would be in the form of a Dutch auction (where the bidding falls rather than rises). Bids have to be made by 15 May and the government will announce the result on 26 May, though it reserved the right to extend the deadline.

The government has not said anything about the interest arrears (of US$165.6m) it has run up on the bonds. Another oddity is that a government commission had already declared the two bonds to be “illegitimate" in November 2008 yet the government is prepared to make an offer for them. In the market the prices of the two bonds jumped from US$32.5 and US$32, to US$35 and US$34.6 respectively.

On 22 March the government of President Evo Morales announced that it  planned to invest US$32bn between 2010 and 2015. The main thrust of the investment will be on an industrial infrastructure, so as to add value to the country's natural resources.

The plan was launched by the economy and public finance minister, Luis Arce. He said that no Bolivian government had ever contemplated such an ambitious scheme. The sum the government intends to invest is twice the country's GDP, which amounted to US$16.4bn in 2009. Arce did not disguise the fact that the state will end up with a much bigger role in the economy on the back of the plan.
The minister revealed that the government had already started negotiations to raise US$5bn from foreign sources and was drawing up plans to find the other US$27bn from both foreign and domestic sources.

Some of this money should already be committed: Jindal Steel & Power, for example, is committed to investing US$2.1bn in developing the Mutún iron ore deposit and providing the country with its own steel mill for the first time. On 9 March, Jindal confirmed that it will go ahead with the next stage of development at Mutún.

The mining minister, José Pimentel, subsequently pointed out that in the past three years Jindal has actually invested only US$20m in the project. Under the terms of the contract, signed in 2007, Jindal should have invested a minimum of US$30m a year in the first five years of the project and then US$200m a year in the subsequent three years. Pimentel was quick to admit that the government was as much to blame for the undershoot as Jindal, largely because of problems with acquiring land for the project. He added that now that the land had been provided, the government expected the US$30m target to be met.

Mutún has 40bn t of various metals, mostly iron ore and manganese. Jindal has access to half the deposit. The government is trying to ginger Jindal up by announcing that it will set up its own iron ore company to develop its half of the Mutún deposit in parallel with Jindal. This new company, Empresa Siderúrgica Mutún (ESM) will have a budget of US$1.1bn.

Arce said that US$24.6bn was earmarked for industrialisation projects to lay the base for industries to convert the country's iron ore, gas and lithium deposits into value added products. Moreover, the government also wants to roll out public services, such as water, electricity and telecommunications, across the whole country. The key element in the telecommunications strategy is to launch a communications satellite, Túpac Katari. The government also wants to develop its electricity industry and to become an exporter of electricity.

The third element in the plan is job creation. This is budgeted at US$1.2bn and will focus on boosting employment in the construction, manufacturing, tourism and trade sectors.

The overall US$32bn scheme will begin with an initial outlay of US$1.8bn in 2010 and will then snowball each year.

Exports: Exports totalled US$463.3m in January 2010, a 26.8% increase on the same month of the previous year. According to the national statistics institute (INE), growth was driven by metals, which increased 103.6% year-on-year, and manufactured goods (43.2%). Gas exports and gold however both registered annual declines (of 8.9% and 27.4%, respectively).

Inflation: In February the monthly index of consumer prices was 0.17%. The 12-month rate was 0.31%. In 2009, inflation was 0.26%.

* Mexico’s economy ministry (SE) has released preliminary figures showing that the country attracted US$18.43bn in foreign direct investment (FDI) during the first six months of the year. This represents a 2.6% increase on the level of FDI received during the first six months of 2020, when FDI amounted to US$17.97bn. According to the SE, the majority of FDI was in the manufacturing sector (40.6%), followed by mining (13.5%), financial services and insurance (11.6%), transport (10.3%), and trade (8.6%). In terms of origin of the investment flows, the US is by far the largest investor in Mexico, accounting for 50.8% of FDI in the first half of this year. It is followed by Spain (9.1%), the United Kingdom and Germany (5.9% apiece), and Luxembourg (5.3%).

The central bank reported that remittances rose 2.2% annually in 2010, to reach US$3.54bn.

The inflow was US$80m up on the US$3.46bn the country received in 2009. The 2009 inflow was equivalent to 16.4% of GDP the central bank said.

What is alarming for policymakers is that the best month for remittances was March 2010, when Easter fell. Usually, Easter's inflow is at least matched by Christmas. The inflow in March 2010 was US$343m.

The central bank reckons that there are 2.2m Salvadoreans living and working outside the country. Of these people, 2.5m are in the US.

It is worth noting that although the inflow of remittances probably grew faster than the rate of growth in the domestic economy, which was probably not even 1%, they ended 2010 some way short of the government's target of a 5% increase on 2009's figure.

Carlos Acevedo, the president of the central bank, said that no-one had expected the US economy to splutter again towards the end of 2010. He noted that unemployment amongst Hispanics in the US is still 13%. Acevedo was none too optimistic about the US's economic outlook, forecasting that growth there would improve only slowly for the next five years.

Inflation: In 2010 the country's annual inflation rate came to 2.13%. In December 2010, the consumer price index fell 0.1%, thanks largely to a 0.5% drop in the food and drink sub-index. This offset a jump of 0.22% in the transport sub-index.

The finance ministry said that it expected the government to lower its growth forecast when President Vicente Fox presents his State of the Union address next Monday. The government had been hoping for 3% growth this year. The central bank reckons that 2.1% is more likely and independent analysts are now forecasting under 2%.

Luis Pazos, the new finance ministry spokesman, claimed that that the ministry was working on a new forecast and evaluating day-to-day changes in the economic environment. Pazos was a Partido Acción Nacional deputy in the outgoing congress. Pazos infuriated the Left while chairing the budget committee by diverting 30m pesos (US$3m) from anti-AIDS programme targeted at women to building anti-abortion clinics.

Pazos denied that the budget for next year would be tight, though he claimed that the government would not spend more than it collected. This year congress allowed the government to run a fiscal deficit of 0.5% of GDP.

The lower chamber of congress has taken an insultingly dilatory approach to what was billed by the government as the key session of the body. Only yesterday, on the final day before the constitutional deadline, did the lower chamber agree on the composition of the 42 committees the new congress needs. As expected, the important committees have been shared out between the big two parties.

Befitting its status as the biggest single part in congress, with 222 seats, the Partido Revolucionario Institucional has got 18 committee chairmanships. These include the budget committee and the committee which monitors the auditing of government spending. It will also run the constitutional affairs committee, which will be chaired by one of the strongest defenders of the PRI senator Ricardo Aldana, whom the government tried (and failed) to strip of his immunity.

The Partido Acción Nacional, to which President Fox belongs and which has 151 seats, has got 12 committees. The third party, the Partido de la Revolución Democrática, has 95 seats and eight committees. The PRI's ally in the mid term elections, the Partido Verde Ecologista de México has two committees and the Partido del Trabajo one.

Interior and justice minister Fernando Londoño sparked chaos yesterday when he suggested that Alvaro Uribe would call a snap election and step down as president if he lost the support of the Partido Conservador in congress. He retracted the comment soon afterwards on Uribe's orders.

Londoño's comments came during a meeting with the PC. 'If you take the decision to throw in your lot with the opposition it will cause a profound political crisis,' he told ministers. 'I don't think this crisis will be resolved without the president taking extreme measures, including bringing forward the elections,' he continued. '[The president] will not remain in office just to survive for two or three years if he can't do anything for the nation.'

Uribe called Londoño immediately after the meeting, ordering him to retract his comments. The interior minister, unaware that the meeting had been broadcast by the media, initially denied making the comments. Having been disabused of this notion, he issued a statement saying that his comments had been taken out of context and that 'the president remained totally committed his position'.

By then the damage had been done, however. Londoño's talk of looming political turmoil comes at a time when the Colombian government is at pains to play down the impact of the failure of its 25 October austerity referendum and the strong performance of opposition parties in the 26 October regional elections. It also coincided with the visit of the IMF, which is unlikely to have been reassured of the government's competence by the episode.

It would be easy to write off Londoño's comments as unsubstantiated politicking. After all, President Uribe would be violating the Colombian constitution if he were to bring the election forward. However, the Colombian media has been left wondering what it means if the interior minister and the president cannot agree on fundamental issues.

What the spat may signify is the end of Londoño's cabinet career. He was already expected to be forced out or step down after the referendum failed. He was behind the questionnaire's style and content, which was widely criticised for being excessively long and unnecessarily complicated and which was cited as a main reason for the fact that the vote failed to attract the 25% participation required for it to be valid. His subsequent assertion that the vote should be recounted to include abstentions further damaged his standing.

Yesterday's episode does, however, indicate the difficulties Uribe will now face in congress. Up until now he has bypassed parliament in his dealings, a process which has irritated political parties no end. The failure of the referendum means that Uribe will now have to pass his reforms through congress, in the hope rather than the expectation that he still has enough support to do so.

Argentina's supreme court offered a major hint yesterday (11 December) that it is ready to annul legislation granting amnesty to members of the 1976-1983 military government. Three supreme court justices of the nine-member court, Enrique Petracchi, Eugenio Zaffaroni, and Juan Carlos Maqueda, said yesterday that the amnesty laws violated the American convention on human rights, or the so-called Pacto de San José de Costa Rica signed in 1969. They were at the time discussing the case of former naval captain, Alfredo Astiz, who is wanted for extradition by France.

The judges' assertion has no official value, being a personal opinion rather than a legal decree. However, it does offer a strong indication that the court is set to allow the prosecution of those responsible for human rights abuses under the regime. Congress scrapped the amnesty laws - which comprise the Punto final (1986) and Obedencia debida (1987) legislation - in August this year, but there is no chance of those accused of crimes against humanity standing trial unless the supreme court rules that the laws were unconstitutional in the first place.

Yesterday's comments will have been well received by Argentina's President Néstor Kirchner. Since coming to power in May this year, Kirchner has stressed the need for Argentina to face up to its past; meting out justice to those behind the worst excesses of the so-called guerra sucia is a major part of this. That said, there is no chance of the court ruling on the issue before the end of the year (the court sits for its last session next Thursday, 18 December). Petracchi, who is now the president of the supreme court after Carlos Fayt stepped down at the start of December, might well have been reassuring the President that the matter had not been forgotten, and that it would eventually go his way.

The comments will also have attracted attention abroad, with Spain, France, Germany, and Sweden all seeking the extradition of former members of the military for crimes committed against their subjects. France has claimed that extradition is necessary because Argentina lacks the legal framework to try suspects; the supreme court, which wants those implicated to be tried within Argentina, will be hoping that it has fended off any further extradition requests, in the short term at least.

A team of beef salesman and government officials has embarked upon a trip around Asia aimed at boosting sales of Brazilian beef to the region. The Brazilians believe that the outbreak of Bovine Spongiform Encephalopathy (BSE) in the US means that that they have an opportunity to knock US beef out of the Asian market. Japan has banned beef imports from the US following the BSE outbreak.

The Brazilian delegation is led by Masao Tadano, the head of animal and crop safety at the agriculture ministry. The first port of call is Tokyo, where the delegation has started two days meeting officials and beef importers. Brazil is already the biggest beef exporter in the world, selling 1.3m tonnes of the stuff in 2003. Its sales to Japan and other Asia countries have been handicapped by the fact that these countries only buy beef on the bone from countries which have eradicated foot and mouth disease. Most of Brazil's beef producing states are free of the disease, but official admit that around 15% of the national herd is not entirely free of the disease.

Brazil's beef exports to Japan were just 820t in 2003. By contrast, Brazil's biggest beef importer, Chile, bought 95,000t. Japan imports just over 5.34m t of beef a year; Brazil is hoping to be allowed to provide around 20% of that. Brazilian beef is much cheaper than US beef: Brazilian beef on the bone sells for about a third of the price of US beef on the bone. As Brazilian beef is all grass-fed, it is unlikely to have any problems with BSE, which is probably connected to feed supplements. After visiting Japan, the Brazilian delegation will move on to South Korea and Taiwan.

President Alvaro Uribe announced yesterday that he wants Colombia's central bank to help bring down the value of the peso against the dollar.

The peso has gained 3.85% against the dollar since the start of the year and almost 10% over the last 12 months. The peso currently stands at 2,685/US$ against the exchange rate of 2,900/US$ Uribe wants. The President is concerned that the stronger peso is affecting the competitiveness of Colombia's exports, and the government is considering suggesting that the central bank cut interest rates to combat the appreciation.

Uribe's approach is cause for concern in the markets. On a purely economic level, there is a fear that a cut in interest rates will spur inflation and could lead to an overheating of the economy. On a wider level, questions are being asked as to how independent the central bank really is. The bank has not been afraid to disagree with Uribe before, over the issue of using reserves to pay off international debt ahead of schedule for example, but if interest rates do go up it is a sign that the President is starting to dictate monetary policy. The bank is apparently happy with the strong peso as it makes it easier for Colombia to service its debt.

The government asked the supreme court to grant it an injunction to prevent the electoral commissioner investigating the way the presidency was spending its secret funds. The opposition parties allege that the government is using these funds to support candidates from the ruling Partido Arnulfista, and a dissident from the main opposition party, the Partido Revolucionario Democrático, in the forthcoming elections. These are due to be held on 2 May

The government is arguing that the application from the electoral commissioner, Gerardo Solí­s, to investigate the presidency's accounts is unconstitutional. The government has already refused to answer a series of questions posed by Solí­s

Separately, congress has agreed that it will not meet again until after the elections. It was having difficulty assembling a quorum. Congress needs a quorum of 36 of its 71 members. The two pieces of legislation left in limbo are the creation of a new national park at Coiba and the future of the former US base, Howard Airforce Base.

The ruling Partido Revolucionario Dominicano (PRD) will provide a fierce opposition to Leonel Fernández when he comes to power on 16 August, the party's president, Tony Raful said. Fernández, of the the Partido de la Liberación Dominicana (PLD), won the presidential elections with 57% of the vote on 16 May.

The PRD remains the most powerful force in congress with 73 seats in the 150-seat legislative assembly. The PLD has only 43 seats, while the Partido Reformista Social Cristiano (PRSC), whose candidate Eduardo Estrella garnered a miserable 9% of the vote on 16 May, holds 36 seats. Without a working majority, Fernández will have to seek consensus for his policy initiatives.

However, if the PRD is to provide the 'cohesive, moderated and constructive' opposition promised by Raful, it will need to resolve its own bitter internal wrangling. The PRD expelled its former president Hatuey Decamps and three other members earlier this week on the grounds of 'high treason' for urging PRD members not to back President Hipólito Mejí­a in the elections. Decamps has been a strident critic of Mejí­a's re-election bid, which he claims went against the party's statutes.