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A justice of the plurinational constitutional court (TCP), Mirtha Camacho, called for calm this week as the body considers an appeal presented by the ruling Movimiento al Socialismo (MAS) to amend the 2009 constitution to allow President Evo Morales to seek re-election in 2019 for a fourth consecutive term. Camacho’s call follows protests which took place on 10 October in five of the country’s nine provincial capitals, timed to coincide with the 35^th anniversary of Bolivia’s return to democracy. This was the second time this year that such unrest had taken place after protests were staged on the anniversary of the 2016 February public referendum on whether to change the constitution, which had delivered a surprise defeat for Morales. With MAS supporters also pledging to take to the streets in support of his re-election bid, tensions look set to rise.

Addressing journalists on 16 October in Sucre, Chuquisaca’s capital and the site of the TCP, Camacho urged calm, noting that the court has 45 days in which to rule on the MAS’s appeal against the current limits on re-election [WR-17-38], which was presented in September. Article 168 of the constitution allows both the president and vice-president to stand for a single consecutive re-election. First elected in 2005 and then again in 2009, Morales was allowed to stand again in October 2014 on the grounds that this was his first re-election under the new constitution. In its case filed last month, the MAS is using the same argument as has been previously used in Costa Rica, Nicaragua, and, most recently Honduras – that the prohibition on re-election is at odds with the human right to be elected.

That Morales’s insistence on running despite the referendum (which he lost by 48.70%-51.30%) remains contentious was suggested in the turnout on 10 October where thousands took to the streets in La Paz, Santa Cruz, Cochabamba, Potosí, and Oruro (all capitals of their eponymous departments). Those present included well-known opposition figures such as former president Carlos Mesa (2003-2005); Samuel Doria Medina, the leader of the opposition party Unidad Nacional as well as the mayor of La Paz; and Luis Revilla, president of the left-wing opposition Soberanía y Libertad para Bolivia (Sol.bo) movement.

This polarisation looks set to continue. Supporters of the MAS have since announced plans to stage pro-Morales marches in response, with groups such as Federación de Juntas Vecinales de El Alto announcing demonstrations on another historic date – 17 October. This is the anniversary of the resignation of former president Gonzalo Sánchez de Lozada (1993-1997, 2002-2003) following ‘Black October’, the 2003 army clampdown which left 67 dead and hundreds injured; Sánchez de Lozada is currently in the US and stands accused in Bolivia of genocide. Another core plank of Morales’s support base, the Seis Federaciones del Trópico de Cochabamba, an organisation comprising cocaleros (coca producers), from his home turf of Chapare, Cochabamba department, has announced further marches scheduled for 26 October.

Another source of discontent

The day before the street protests calling for the result of the referendum to be respected, the police dispersed hundreds of cocaleros from Los Yungas area (La Paz department) upset about the change in limits imposed on legal coca cultivation which were introduced by a new law promulgated in March 2017. The changes increased the total coca production area permitted in Bolivia from 12,000 hectares (ha), in legislation introduced in 1988, to 22,000ha (of which 14,300ha is permitted in the Yungas and 7,700ha in the Chapare, where coca cultivation became legal in 2004). However, the Yungas cocaleros fear that the changes may lower the legal domestic price for coca leaf, and they consider it a political move by President Morales to reward his supporters in the Chapare.

• TCP concerns

The renewed attention on the seven-member TCP comes as it is due to be re-elected in December’s national public elections which are also being staged for the supreme court (TSJ), council of magistrates, and the environmental court (TA). This is the second popular vote of its kind, after elections held in 2011. The local daily el Deber reported on 16 October that in six years of operations, a total of 65 complaints have been filed against the seven TCP judges, citing a report by the attorney general’s office.

Honduras is posting decent economic growth and stable macro-economic indicators, yet is making next to no social progress.

Economic context

An IMF team visited Tegucigalpa on 12-16 November to assess recent economic developments since the completion of the 2018 Article IV consultation in May and the medium-term outlook. Among various senior officials and representatives of the private sector, the mission met with the BCH governor and head of the economic cabinet Wilfredo Cerrato, Finance Minister Rocío Tábora, the Minister Director of the Tax Agency Miriam Guzmán, and the chief commissioner of the National Commission of Banking and Insurance, Adonis Lavair.

The mission’s concluding statement observed that macroeconomic conditions had remained stable, with growth expected to be resilient in the near term. Buoyant activity in the US – the country’s main trade and investment partner – will drive growth, supported by prudent macroeconomic policies on the domestic front. The IMF said it would continue to engage with the Hernández government towards negotiations for an economic programme that could be supported by a new financial arrangement with the IMF. The Fund’s last three-year facility for Honduras expired in December 2017.

After rapid growth in 2017, when real GDP rose by 4.8% year on year, the Fund projects growth of 3.5% this year, close to trend. On the back of higher world oil prices and a faster rate of devaluation, the year-on-year rate of inflation was touching 5% in late October, albeit this remained within the 4%+/-1% target range set by the central bank of Honduras (BCH).

The business sector has expressed concern about the pace of devaluation this year, with the lempira losing almost 3% from January to mid-November, to trade at HNL24.2/US$ on 16 November. Given the country’s import dependency, this raises the costs of production for the local manufacturing sector and eats into consumer purchasing power.

Pedro Barquero, executive director of the Cortés Chamber of Commerce and Industries (CCIC), in the north of the country, on 14 November said the private sector wanted a technical explanation from the head of the BCH (and economy policy chief), Wilfredo Cerrato, about the accelerated pace of devaluation this year. Barquero noted that overall conditions – including the differential between internal and external inflation, the performance of the reference basket of external currencies, as well as the international reserves’ position – were not markedly different from previous years. In 2017, the lempira marginally appreciated, reflecting stronger growth and investment.

Likewise, declining terms of trade – because of higher global oil prices and lower coffee prices – means that the current account deficit is projected at 3.25% of GDP in 2018, from roughly 1.7% last year.

The IMF noted that the Honduran fiscal position continued to be anchored by the Fiscal Responsibility Law, and ongoing measures to clean up indebted state-owned companies like the Empresa Nacional de Energía Eléctrica (ENEE). As such, the non-financial public-sector deficit is expected to stay within the law’s ceiling of 1.2% of GDP in 2018.

Corruption – minimal progress

The government’s efforts to clean up bloated state companies is not fully matched by anti-corruption efforts, however. As our sister publication Latin America Weekly Reported detailed on 15 November, the head of the special prosecutor’s unit against corruption and impunity (Ufecic-MP), Luis Javier Santos, recently called on the supreme court (CSJ) to clarify the status of high-level corruption cases that appear to have been shelved – not least the major investigation, unveiled in June, implicating both the ruling Partido Nacional (PN) the other main traditional Partido Liberal (PL) in various acts of corruption including campaign finance irregularities.

In early November, the attorney general’s office detained 377 public sector officials on suspicion of corruption under Operation Dragon XI. In this unprecedented sweep, authorities seized documents and took declarations in institutions including the national registry office (RNP), the education ministry, the health secretariat, and Hospital Escuela Universitario, the main teaching hospital in Tegucigalpa.

While the AG was quick to boast of this operation, Santos again reiterated the continued lack of progress in the more serious corruption investigations uncovered by the Mission to Support the Fight against Corruption and Impunity in Honduras (Maccih) – set up by the Hernández government in 2016 in response to widespread public demands – with the support of the main hemispheric Organization of American States (OAS). The cases uncovered by the Maccih include the so-called ‘Pandora case’ in which public funds to the tune of HL282m (US$11.7m) meant for agricultural, agro-industrial, and horticultural projects were used to finance the political campaigns of both the PN and PL ahead of the 2013 general election (when Hernández was first elected).

Other high-level cases have netted the former first lady Rosa Elena Bonilla de Lobo, wife of the discredited former president Porfirio Lobo (PN, 2010-2014), who was arrested in February 2018 on charges of illicit association, embezzlement, and money laundering to the tune of over HL16m. Another high-profile case implicates sitting national deputies in siphoning off public funds.

This latter case, which came to light in late 2017, prompted a fresh backlash against the Maccih from congress, which has actively pushed back against the Mission ever since its installation. Even though the congress is effectively led by the ruling PN, the executive led by President Hernández has made no apparent effort to deter these legislative attacks and legal efforts to undermine the Maccih.

The cost of corruption in human terms

A recent report by the regional security consultancy InsightCrime looking at the main drivers of the human caravan of migrants from the Northern Triangle detailed some of the costs of corruption and insecurity to citizens of Honduras, El Salvador, and Guatemala. While the report noted that poverty, climate change, and a lack of economic opportunities are among the main reasons for people to abandon their homes and countries, crime and corruption are also high on the list.

In Honduras, the report noted, locals are estimated to fork out some US$200m annually in extortion payments to gangs, drug traffickers, and organised crime – with most victims comprised of poor households and small businesses. “Gangs are so pervasive they create an invisible but powerful border in some of even the smallest towns, deterring families from visiting their relatives, going to school, or taking a job in a place controlled by the rival gang”, the report notes.

However, broken institutions and almost total impunity are also major problems, with Central Americans having next to no faith in their governments and the public authorities tasked with protecting them.

Of 69 countries assessed in the 2017 edition of the Global Impunity Index, compiled by the Center for Studies on Impunity and Justice (CESIJ), Honduras ranked almost bottom, at 12^th (El Salvador and Guatemala were not much better at 13^th and 19^th respectively). As the report points out, when crimes are not prosecuted, it reinforces the belief that authorities are corrupt and that criminal groups control them.

In Honduras, for example, the national police commissioner was arrested in October on various charges including money laundering. Douglas Farah, a security expert on Central America, told the consultancy that high impunity rates “play a huge factor into feeding hopelessness among people who are worn out psychologically” after decades of both gang control and failing, corrupt governments.

Anti-government sentiment combusts

Honduran police used tear gas and water cannon to disperse hundreds of protesters demonstrating near the presidential palace in the capital, Tegucigalpa in late October.

The protests were part of an internal ‘caravan’ in Honduras organised in response to the much-publicised migrant caravan which left the country on 13 October in a bid to reach the US. The protesters accused the Hernández government of failing Honduran citizens, obliging them to take the most desperate measure – fleeing their homeland – for a better life. They called on President Hernández to resign, and urged other social organisations to rise up against the “dictatorship” they accused him of installing.

The ‘Great Caravan of Dignity’, which set out from La Barca in the north-eastern border department of Cortés for Tegucigalpa on 23 October, clashed with police after being prevented from marching along the street leading to the presidential palace. The march was organised by a Jesuit priest called Ismael Moreno, an outspoken critic of Hernández who he accuses of leading an “illegal, illegitimate, and usurper government”.

Moreno’s march gained more publicity because of the migrant caravan. The umbrella civil-society organisation he represents, Convergencia contra el Continuismo, explicitly linked the protest march to the plight of the migrants that left San Pedro Sula, accusing the Hernández administration of deepening poverty and repression, while violence and insecurity increased in Honduras.

On 25 October Hernández claimed that “radical groups”, which he did not identify, were the “promoters” of the migrant caravan. He alleged that the migrants had “political motivations”. He also claimed that over 4,000 of them had now returned voluntarily from Guatemala and Mexico by land and air. His government launched a repatriation initiative, ‘Plan Retorno Seguro’ (‘Plan Safe Return’), on 20 October. There is no official figure for the size of the migrant caravan which left San Pedro Sula but the United Nations (UN) has put it at some 7,000.

Inaugurated as a public holiday in 2009, Plurinational State Day was envisioned as a celebration of unity between Bolivia’s multiple cultures and communities. On 22 January 2020, it served instead to highlight the fierce divisions that have come to characterise Bolivian politics and society, as the day was dominated by the exchange of criticisms and accusations between the interim government and its opponents.

Concerns that demonstrations on 22 January would turn violent eventually proved unfounded. The day also marked the scheduled end date of the mandate of Jeanine Áñez’s interim government, but the challenges promised by legislators and protesters alike [WR-20-01] seemed to evaporate immediately once the constitutional court (TCP) deemed an extension of this mandate until after May’s elections to be constitutionally valid.

But earlier threats of protests had been enough to convince Áñez of the danger, and it was announced on 16 January that police and military forces would be deployed across Bolivia until 24 January, with defence minister Fernando López warning that any “collective hysteria” on 22 January would not be tolerated. This deployment seemed designed to intimidate rather than actively repress, and the muted celebrations of Plurinational State Day - except in strongholds of the Movimiento al Socialismo (MAS) - suggests this intimidation proved successful.

This year’s celebrations were given extra significance by the difficult relationship between the interim government - supported most prominently by conservative Christians and the white middle-classes - and the indigenous communities that are amongst its fiercest critics. The deployment of the armed forces included a return to Chapare province (Cochabamba department), despite having been expelled in November 2019, accused of killing nine indigenous protesters. López insisted that “the military don’t need anyone’s permission to enter Chapare”, which he called an “independent narco-terrorist micro-state”.

It had been uncertain whether Áñez would commemorate the day at all; in the end she gave a brief speech to just a couple of hundred supporters, focused primarily on criticising former president Evo Morales (2006-2019) and the MAS. A parallel event held by Morales in Argentina, where he is a political refugee, was much better attended, but concentrated on condemnations of Áñez and the armed forces. Crowds gathered in MAS strongholds like Cochabamba and the city of El Alto. While these events remained peaceful, they were undoubtedly closer to demonstrations than celebrations.

MAS candidate controversy

The lack of active opposition to the interim government can perhaps be explained by the emergence of divisions within the MAS itself. Morales’s announcement on 19 January of former economy minister Luis Arce (2006-2019) as the party’s presidential candidate was carefully framed in terms of unity and reconciliation, both within the party and the country as a whole.

But this decision proved unpopular in some quarters – the selection of former foreign minister David Choquehuanca (2006-2017) as Arce’s running mate was intended to appease the influential Unity Pact grassroots coalition that had nominated him for the top job. But even Choquehuanca had seemingly been the Unity Pact’s compromise choice, with the popular Andrónico Rodríguez, a 30-year-old coca producers’ union leader, suggested only for vice president, given his relative lack of political experience.

Morales asserted that an Arce-Choquehuanca ticket would bring together “comrades in the city and comrades in the countryside”, combining “scientific knowledge with ancient indigenous knowledge”, reflecting the MAS’s clear efforts to appeal to the urban middle-classes that have grown increasingly hostile to Morales in recent years. A range of senior figures in the party, including Rodríguez himself, expressed the need to unite behind the decision - but many of the rank-and-file were less pleased, with Álvaro Mollinedo, head of the El Alto peasant organisation Federación de Campesinos Túpak Katari, condemning Morales’s support for a non-indigenous candidate as a “betrayal”.

A statement by senate president Eva Copa on 22 January suggests the selection process may not be as final as Morales insisted. She repeated her earlier promise that the final decision will be made in Bolivia, not by Morales in Argentina, and noted that the Unity Pact would meet again on 23 January to discuss the next steps. With the 3 February nomination deadline looming, the challenge of finding a candidate that offers broad national appeal, without alienating the party’s crucial indigenous support base, indicates that the interim government is not alone in struggling to walk the tightrope of a country more divided than ever.

Arce investigated

Just hours after Luis Arce’s appointment, the interim government announced that investigations into corruption in the Fondo Indígena development fund would be expanded to scrutinise his role in the case. MAS had already raised concerns about Jeanine Áñez’s weaponisation of the judiciary and the fate of former interior minister Carlos Romero (2012-2019), sentenced on 17 January to six months in prison after a trial that allegedly presented no evidence against him. This will only exacerbate fears that the interim government will do all it can to eliminate any candidate nominated by the MAS.

A Paraguayan proposal to boost cross-border retail sales has been rejected by the Brazilian authorities. With the coronavirus (Covid-19) pandemic forcing border closures and paralysing usually vibrant cross-border economic activity, border cities like Ciudad del Este in Paraguay are taking a hit.

Paraguay has one of the best records in Latin America for containing the coronavirus pandemic. Brazil has one of the worst. In mid-June Paraguay’s mortality rate from the virus was two per million inhabitants, the lowest in the region, ahead of Uruguay with six. In contrast mortality in Brazil was one of the highest, at 210 per million. Paraguay’s success has been attributed to various factors, among them an early and stringent lockdown, relative geographic isolation, low population density, an early decision to close its frontiers (taken on 24 March), and strict medical protocols for Paraguayans coming home, including 14-day quarantines in approved shelters. A gradual reopening of the Paraguayan economy is now underway.

From Asunción’s point of view, the big threat has been contagion from Brazil. Juan Carlos Portillo, a health ministry official, says “If Brazil sneezes, Paraguay catches pneumonia”. The fact that these two countries are immediate neighbours, sharing a 1,300km common border as well as being close economic partners, makes things particularly difficult from an economic as well as sanitary point of view.

Last year Paraguay’s commodity trade with Brazil was worth US$5.16bn (exports of US$2.527bn, imports of US$2.635bn). Brazil is Paraguay’s second largest export market, taking 16.4% of all exports after Argentina, which takes 24.2%. The main exports are insulated wire, rice, maize, wheat, and beef. Brazil is also a key buyer of electricity from the giant jointly owned Itaipú hydroelectric complex. So, even if Paraguay manages to keep relatively coronavirus-free, an economic hit this year is unavoidable. In early July President Mario Abdo Benítez said the country’s foreign trade had dropped 21% so far this year. The International Monetary Fund (IMF) has forecast that Paraguay’s economy will shrink by 5% in 2020, while it expects Brazil to contract by 9.1%. The central bank in Asunción predicts a less dramatic drop of 2.5% for Paraguay.

There is a specific problem facing Paraguayan cities on the border with Brazil, such as Ciudad del Este and Pedro Juan Caballero. These have traditionally sold electronic and consumer goods including wines and whisky to Brazilian tourists, attractively priced because of exchange rate and tax disparities or simply sales tax evasion (contraband and drug trafficking are also long-standing cross-border features). With no Brazilian tourists able to cross the border, these sales have plummeted.   

• Closed frontiers disrupt drug smuggling

The illicit economy has also been affected by Covid-19. Brazilian police say that the closure of the border with Paraguay has allowed them to double seizures of marijuana in March-June this year, to more than 200 tonnes. The marijuana is smuggled by Brazilian drug trafficking organisations, who then ship most of it to Europe. The increase in seizures is attributed to a 40% increase in available border police staffing (because units have been reassigned) and a sharp reduction in cross-border traffic because of the formal travel ban now in place. The net result is that more border police scrutinise fewer travellers, and the stepping up of surveillance of the isolated pathways and river transport routes favoured by the smugglers.

In response, in mid-June Paraguayan officials proposed a border ‘recovery plan’, reported to include online purchases, reduced border taxes and tariffs, and value-added tax (VAT) exemptions for electronics, mobile phones, and whisky. Although the details remained sketchy, one idea seems to have been to allow Brazilians to enjoy a duty free shopping quota of up to US$500, without them actually entering Paraguay. The purchases would be delivered by cross-border courier. Brazil did not respond positively, however.

Brazilian treasury officials did not accept the concept of duty free allowances without physical travel. From their point of view goods delivered in this way would be subject to confiscation on the Brazilian side of the border as contraband. Talks on opening up retail transactions may also be placed on hold because of concern over rising contagion. On 26 June Paraguay’s health minister, Julio Mazzoleni, said the border department of Alto Paraná should be considered a ‘red zone’ due to new Covid-19 cases. The authorities were particularly worried by an outbreak of some 140 cases in the main prison in Ciudad del Este. There has also been a new lockdown in Foz do Iguaçu, the Brazilian city across the river from Ciudad del Este. As a result, it may take some time before the two countries agree to reopen the border.

President Luis Abinader was re-elected on 19 May to a second four-year term with a comfortable 58% of the vote. Significantly his party, the Partido Revolucionario Moderno (PRM), won a clear majority in the bicameral congress, with 29 out of 32 senators and 146 out of 190 deputies. That means reforms are on the way.

During his second term in office Abinader’s policy agenda is likely to break down into four headings: these are first, constitutional reform; second, action on how to deal with the crisis in neighbouring Haiti; third, restructuring of state-owned electricity companies; and fourth, a major fiscal reform. The background is that the Dominican Republic remains one of the fastest growing economies in Latin America with a strong pro-business agenda (the International Monetary Fund is predicting that the country’s GDP will expand by 5.4% this year); but the country still has a high poverty rate (23%).

With more than a two thirds majority in the senate and the lower house, Abinader has said that his second administration will seek constitutional reform. Full details of what he proposes have yet to emerge. But in recent comments the president has said that he wants the attorney general’s office and the electoral commission (JCE) to have greater autonomy, strengthening anti-corruption and electoral integrity efforts. He has also signalled that he will not seek changes to the current presidential term limits which allow only one consecutive re-election. He says he will not seek re-election in 2028. Constitutional reform is likely to be supported by the business community.

The crisis in Haiti, the Dominican Republic’s immediate neighbour on the island of Hispaniola, remains unpredictable. Abinader has capitalised on anti-immigrant sentiment, building a border wall and increasing deportations of Haitians (there were over 250,000 deportations of Haitians in 2023 on government figures cited by rights activists in April). While the business community has welcomed strengthened border controls, the new government may face international pressure to provide humanitarian assistance and recognise the rights of migrant workers. There is no official data on the number of Haitians in the Dominican Republic, but estimates cited in a July 2023 piece by Emmanuela Douyon, a Haitian development specialist, published by US think tank Migration Policy Institute, suggest there may be as many as 1m Haitians. Many work informally and for low wages, mainly in the tourism and construction sectors.

The president will also need to tackle electricity sector reform. Three state-owned power companies (Edenorte, Edesur, and Edeeste) are loss-making and in need of reorganisation and modernisation, with significant numbers of electricity users evading payment. Through these companies the government is now spending around US$4bn a year in energy subsidies. An investment deficit means future power shortages could inhibit two key engines of the country’s recent growth: tourism and manufacturing.

Abinader considered fiscal reform during his first presidency, but it was put on hold because of the coronavirus (Covid-19) pandemic. There is certainly a convincing case to be made for reform. Tax collection remains weak at only 14.2% of GDP, below the Latin American average. Tax evasion is high – evasion of value-added tax (VAT) on its own is thought to represent revenue losses equivalent to 4.5% of GDP. Successive governments have run fiscal deficits ranging between 3% and 5% of GDP (3.1% in 2023). The debt-to-GDP ratio has increased to over 60%. There has been an investment shortfall in essential public infrastructure, including roads, schools, and ports. 

Private sector

Business leaders acknowledge the need for fiscal reform, but at the same time are somewhat nervous about it. Julio Virgilio Brache, president of business lobby Asociación de Industrias de la República Dominicana (AIRD) says: “Above all, what we want is a reform that does not switch off the motors of industry: let it keep working, creating jobs and competitive exports”. Proposals to raise corporate income tax are likely to be resisted by the private sector.

MEXICO | Sheinbaum announces business council. Mexico’s President-elect Claudia Sheinbaum has announced the creation of an advisory business council which will have the objective of encouraging private investment focused on regional development and nearshoring.

Sheinbaum announced the council following a private meeting with business leaders at an international monetary conference on 9 July, stating that her government will seek investment that generates regional development and wellbeing for Mexicans.

Altagracia Gómez, a well-known businesswoman who served as an economic adviser to Sheinbaum during her campaign, will coordinate the council, acting as a point of liaison between the government and the private sector. The council will consist of various private sector representatives and will work closely with the incoming economy, finance, and energy ministers, Marcelo Ebrard, Rogelio Ramírez de la O, and Luz Elena González Escobar respectively.

Sheinbaum has indicated that she will have a more collaborative relationship with the private sector than her predecessor, President Andrés Manuel López Obrador. On 18 June, she met with representatives of the country’s umbrella business association Consejo Coordinador Empresarial (CCE), which has often been at loggerheads with López Obrador, to assuage investor concerns surrounding the extent of dominance the ruling left-wing Movimento Regeneración Nacional (Morena) is set to enjoy under her government.

In September, artisanal fishing associations in the north of Peru warned that a shortage of Humboldt squid (the most important type of squid worldwide for commercial fisheries) was due to the incursion of Chinese fishing boats into Peruvian territory. In response, the production ministry announced that it was intensifying the processes it used to audit ships in Peruvian territorial waters, including through satellite systems operated by the navy.

Representatives of various Peruvian fishing associations have reported sightings of large Chinese fishing boats close to the Peruvian coast, and they have associated this occurrence with the scarcity and resultant high prices for the squid, which according to the local media have risen by more than 400%, from around PEN5 (US$1.30) per kilogram to around PEN25 per kilogram. According to the president of the fishing association Sociedad Nacional de Pesca Artesanal del Perú, more than 300 Chinese boats have illegally entered Peruvian waters since 2023. Tensions have simmered over the issue for years, with Chinese vessels regularly accused of ‘going dark’ by turning off their tracking devices as they approach Peru’s maritime territory.

The government response, however, has been to declare that the squid shortage is not a matter of overfishing by Chinese boats, but rather a result of the El Niño weather phenomenon. Several fishing associations have been unhappy with this explanation and with the government’s promise to resolve the issue with its satellite monitoring plan. Fishing communities in the southern regions of Tacna and Arequipa announced a 48-hour strike and roadblocks from 4-5 October as they called for tougher measures against Chinese fishing vessels in Peruvian waters. Their concern, they state, is both for their own livelihoods and for the environmental impact of these large vessels.

Given the crucial role that Chinese investment plays in various sectors of the Peruvian economy, the rather limited response from the Peruvian government is unsurprising. Successive governments have failed to act on the issue and have been accused by the domestic fishing sector of running scared of Beijing. The issue is therefore unlikely to be resolved any time soon, despite the negative impact the high prices for squid may have in certain areas on food security.

Many of the fishing associations would like an outright ban on Chinese boats entering Peruvian waters, but this is unlikely to happen when Chinese capital is funding so many major investment projects that are so key to the government’s efforts to revive the economy. First and foremost of these is the Chinese-funded Chancay mega-port, which is nearing completion and will act as a new trade hub linking South America and China. President Dina Boluarte signalled during a June visit to China that she views close cooperation with Beijing as essential to Peru’s continued economic growth [EB-24-09].

Three different initiatives in Peru seek to waive or postpone prosecution of serious human rights and corruption charges.

The first is an amnesty law for members of the police, army, and militias accused of violating human rights and committing other related crimes during Peru’s internal conflict in 1980-2000, in which some 70,000 people are estimated to have died.

After previous approval in the conservative-dominated congress, President Dina Boluarte promulgated the law on 13 August despite a request not to do so from the Inter-American Court of Human Rights (Corte-IDH) which called for a prior review of its compatibility with international law.

Volker Türk, the United Nations high commissioner for human rights, said he was “dismayed” by the law which was an “affront” to “the thousands of victims who deserve truth, justice, reparations and guarantees of non-repetition, not impunity.”

Boluarte, in contrast, sought to frame the issue as a matter of national sovereignty, dismissing the Corte-IDH’s position as undue external interference in Peru’s legislative affairs. Peru is, however, a signatory of the 1969 American Convention of Human Rights which set up the Corte-IDH, so the Lima government will face pressure to recognise its authority and perhaps negotiate a compromise. This seems unlikely, however, given the government’s hostile stance towards the court. Government ministers have in recent months repeatedly floated the idea of withdrawing from the 1969 Convention, spurred on by the right-wing parties that control congress and prop up the government.

A second amnesty bill is also in the works. Deputy Fernando Rospigliosi, vice president of congress and a member of the right-wing Fuerza Popular (FP) party, said on 18 August that a new piece of legislation would seek to absolve police and military implicated in crimes committed during the violent suppression of anti-government protests in 2022-2023, which rocked the country following the arrest and impeachment of left-wing former president Pedro Castillo (2021-2022) and his replacement by Boluarte at the head of a right-wing ruling coalition.

An estimated 49 people died in those clashes, mainly in mining communities. Rospigliosi said “the military and police who defended the country and saved Peru from falling into a dictatorship under Pedro Castillo, turning us into a Cuba or a Venezuela, are being unfairly prosecuted”.

If approved the second amnesty could also shield Boluarte and a number of her ministers and officials, who face a constitutional complaint, filed by the attorney general’s office, alleging responsibility for genocide, homicide, and injury during the protests. Rospigliosi insists that both these amnesties are “absolutely legal and constitutional”.

The third initiative came on 19 August when Peru’s constitutional court ruled that all investigations involving Boluarte must be immediately stopped. The tribunal said that while in office the president has full immunity from prosecution and can only be investigated for specific crimes set out under article 117 of the constitution – namely treason, dissolution of congress, or prevention of elections.

The ruling means that current investigations into Boluarte’s role in suppressing the 2022-2023 protests, along with various cases involving corruption charges, illegal campaign finance, and unauthorised absences from office, are put on hold.

Reactions to the constitutional court’s ruling were predictable. Government-aligned conservative deputies such as Alejandro Cavero (Avanza País) said it was designed to protect the institution of the presidency, not Boluarte as the current and temporary officeholder. On the left, Margo Palacios (Juntos por el Perú) said the court had given “a life jacket” to “Dina Boluarte’s corrupt and murderous regime”. Certainly, the recent actions to push forward amnesties and widen presidential immunity will not help Boluarte’s image. The latest Datum poll published on 18 August gave Boluarte a massive 96% disapproval rating. Only 3% of respondents approve of her performance and only 1% said they were unsure.

Clashes with SL

The army said that on 15 August it was involved in firefights with remnants of the Maoist guerrilla group Sendero Luminoso (SL) in the isolated Apurímac, Ene, and Mantaro rivers valley (Vraem) – the largest coca-growing area of the country. SL was a powerful guerrilla force in the 1980s and 1990s but is now a tiny organisation operating only in some areas of coca cultivation and trafficking.

Ecuador’s President Daniel Noboa announced on 21 January that Colombian imports would face a 30% ‘security tax’ due to the country’s alleged failure to combat crime along the border. Colombia responded in kind and also announced a suspension of electricity imports to Ecuador – a move which could undermine Ecuador’s recovery from the devastating energy crisis of 2023-2025 and to which the Noboa administration responded by announcing a massive increase in the price charged to move Colombian oil through the Ecuadorean pipeline system.

President Noboa claimed in a social media post that “while we’ve insisted on dialogue, our soldiers continue to fight criminal groups linked to drug trafficking along the border without any cooperation”. He said that “due to the lack of reciprocity and concrete actions, Ecuador will apply a security tax of 30% on imports coming from Colombia as of 1 February”. The tariff, he said, will remain in place “until there is a real commitment to jointly tackle drug trafficking and illegal mining along the border”.

In response, Colombia slapped tariffs on 73 Ecuadorean imports and announced a suspension of electricity exports to the country in order to “guarantee domestic supply”. Ecuador then hit back, with Energy and Environment Minister Inés Manzano announcing that the tariff charged to transport Colombian crude along Ecuadorean pipelines would rise by an eye-watering 900%, from US$3 per barrel to US$30.

Colombia’s government has hotly denied that it is being negligent in policing the country’s southern frontier, although there is no denying that it is the trafficking of Colombian cocaine which is the principal driver of violence in Ecuador. President Gustavo Petro said after Noboa’s announcement that since his government took office in 2022 “we’ve seized over 200 tonnes of cocaine on the Ecuadorean border, we’ve had hundreds of skirmishes, and recovered hundreds of rifles”.

Petro has also cast aspersions over Ecuador’s port security, claiming that the country is a key gateway into the Americas of precursor chemicals used to produce fentanyl. In doing so, Petro may have been hoping to tarnish Noboa’s relationship with US President Donald Trump, who has declared fentanyl a key priority and whose administration has forged close ties with Noboa while clashing repeatedly with Petro.

Recent moves from Colombia have signalled a desire to end the standoff with Ecuador, amid business concern in both countries about the impact on bilateral trade, which totalled US$2.2bn from January-October, according to figures published by the Colombian government. Colombia’s national police helped to coordinate the arrest on 26 January of an alleged leading member of the Ecuadorean criminal gang Los Lobos, named as Vicente ‘Viche’ Bienvenido FC, at Quito airport.

On the same day, Colombia’s defence ministry issued a statement highlighting increased drug seizures since Petro took office, saying that the authorities had impounded 2,863kg of cocaine between August 2022 and December 2025. It emphasised that “cooperation between Colombia and Ecuador has produced concrete results”. However, Noboa does not seem ready for a détente.

• Petro and Noboa

Despite hopes that he might agree a truce with President Petro while they were both attending the Latin America and the Caribbean International Economic Forum 2026, organised by the CAF-Development Bank of Latin America, in Panama on 28 January, President Noboa left the event early and without meeting his Colombian counterpart. Ecuador’s ambassador to Panama, Pascual del Cioppo, said that Noboa needed to attend to an unspecified “emergency” in Ecuador.

On 6 October Mexico’s lower chamber of congress approved a digital economy bill submitted by President Claudia Sheinbaum as part of efforts to drive the adoption of digital payments in a bid to boost tax collection and labour formalisation.

The Ley de Economía Digital para Pagos Digitales y Electrónicos is a framework law that is designed to facilitate digital payments and authorises the finance ministry (SHCP) to mandate certain sectors, reportedly including toll road booths and petrol stations, to accept only digital payments rather than cash. Federal, state, and municipal authorities will also be required to accept digital payments. The bill simplifies and promotes the Codi digital payments platform, which was launched in 2019 but has not been widely adopted, with new central bank rules governing a standardised user experience for the platform among banks. In addition, it will allow informal business owners to open a new type of bank account that isn’t associated with a tax identity. However, the bill does not provide for any sanctions, which will be imposed via secondary regulation.

The bill is part of Sheinbaum’s efforts to increase adoption of digital payments at the expense of cash, which 85% of Mexicans said they mostly still used for purchases under M$500 (US$30) in 2024, according to the national survey of financial inclusion (Enif). Overall, Mexico ranks sixth in the world in terms of cash use, with 80% of daily transactions being made in cash, according to Mexico’s banking association (ABM) and the Forex Cash Index 2025 (this fell to 70% in the 2026 index). This is due in part to the persistence of the informal economy, in which workers and businesses prefer to use cash to avoid paying taxes and payment fees. As a result, making more payments digital would reduce tax evasion, and could also boost efforts to crack down on corruption and illicit electoral financing. Sheinbaum called the bill “very important” and promised that the digitalisation push would continue with the aim of “diminishing the role of cash.” She explicitly cited benefits such as “security, efficiency and even formalisation because it creates a payment history in a bank account.”

The bill has been generally well received by Mexico’s banking and business sectors. Vicente Gutiérrez Camposeco, president of the Cámara Nacional de Comercio, Servicios y Turismo de la Ciudad de México business association, said that digitalisation would be a net positive as long as it doesn’t result in a greater administrative burden for small business owners. In comments circulated by the local press, Camposeco highlighted that payment fees will influence adoption by these businesses, with any cost increases that eat into operating margins likely to dampen interest. Emilio Romano, head of ABM, also talked up its potential impact in an interview with The Economist, published on 19 August. “It’s the starting point to reduce informality, improve productivity, increase the tax take, increase financial inclusion and even reduce crime rates,” he said. Big companies such as drinks conglomerate Pepsi and Mexican brewery Grupo Modelo, which currently have to transport cash around rural areas in Mexico, are also reportedly in talks to expand the use of digital payments, while discount retail chain Tiendas 3B has already launched a pilot project of stores that accept only Codi and cash in order to save on card fees. 

This alignment suggests that the bill has a decent chance of boosting digital payment adoption if it is passed into law, not least because of the new rules mandating digital payments in certain sectors. But the extent to which the law will be able to herald a sea change in Mexico’s relationship with cash will depend on a number of factors. First, connectivity in rural areas may pose challenges. Although José Antonio Peña Merino, head of the government’s digital transformation agency, has claimed that 94% of adults have access to an internet-connected smartphone, concerns around network coverage leading to difficulties handling payments may encourage a continued preference for cash. Second, government communication around the tax implications for small businesses and informal workers will have a significant influence on adoption. There is already an important precedent for the scale of the challenge in this regard: Codi launched in 2019 but was only processing an average 12,000 transactions a day by 2025, according to think tank México Evalúa – a tiny number in a country of 130m people, with only 38% of adults having heard of the platform. In addition, a study from the central bank (Banxico) concluded that fear of tax authorities was one reason why Codi failed to make inroads in Mexico.

Looking ahead, this is the first significant step in Sheinbaum’s digitalisation push, rather than an end point. The bill still requires approval by the senate and could be amended before publication, while its effectiveness will depend on the secondary regulation, that still needs to be defined, as well as on the contents of the framework law. Enforcement will also be the responsibility of sectoral regulators, which may vary in terms of effectiveness. 

Driving down payment fees will also be important, with a national chamber of commerce, services, and tourism (Concanaco Servytur) survey finding that 46.5% of small businesses currently don’t accept card payments, citing fees that average more than 3.5%. Banking authorities previously floated plans to cap fees in October 2025, but the proposal was withdrawn due to opposition from banks. An updated proposal was put out for consultation from 27 August to 24 September, but Mexican banks reportedly bring in nearly a third of their operating revenue from fees, meaning resistance is likely. 

Mariana Campos, director of Mexico Evalúa, summarised the situation succinctly in a statement published on 26 August. “Adoption won’t happen solely due to public appeals, financial education campaigns or new apps. It’s necessary to change the calculation in terms of convenience,” she said. “If paying digitally costs less, saves time, avoids queues, reduces risks and facilitates access to other benefits, people will have a concrete reason to prefer it.”

For business, the bill should present significant opportunities for fintech companies and payment platforms, as it should help to bring some of the approximately 18m Mexican adults who currently don’t have a bank account into the financial system. Peña Merino’s forecast that at least 50% of transactions will be digital by 2027 seems ambitious, but he cited the example of Brazil, where the Pix payment platform was reportedly adopted by 80% of the population during its first year of operation. The major difference there is that it was mandatory for large financial institutions to adopt the platform, whereas Mexico’s approach appears to be a lighter touch at this stage.

South Korea’s president signs MoUs during Mexico visit

On 24 September President Claudia Sheinbaum met with South Korea’s President Lee Jae-myung in Mexico City, with the pair signing 17 memorandums of understanding. Speaking at a joint press conference, Lee highlighted that the agreements concluded the successful renegotiation of a trade promotion and investment protection deal, as part of a wider drive to deepen economic ties between the two nations. Lee called Mexico “a highly relevant strategic partner for Korea.” For her part, Sheinbaum underlined that South Korea is one of Mexico’s top five trading partners, with bilateral trade reaching US$29bn in 2025. The two leaders also officially adopted the Mexico-Korea Action Plan 2026-2030. The moves are part of Sheinbaum’s wider plan to diversify Mexico’s economic relationships at a time of significant tensions with the US.

Having signed numerous Free Trade Agreements (FTA) with Western nations, though some, like the one signed with the US in 2006, are still pending ratification and implementation, Colombia’s economic policymakers have now turned their efforts to the East. As we go to print, President Juan Manuel Santos is on an official state visit to Asia where he signed investment agreements with the Japanese government. These have paved the way for discussions regarding a possible FTA, within the framework of a more comprehensive Economic Partnership Agreement (EPA), between the two nations, a discussion that has been underway with South Korea for some time and which could result in a bilateral FTA before year end.

Choo Jong Youn, Korea’s Ambassador to Colombia, believes Santos’s tour of the region is so important to Colombia’s relations with the far east that he said there will be a before and an after to this visit. “Our relationship will make a huge leap forward. [The visit] has a very important meaning [and the relationship] will be more strategic”, he told the local Colombian media. For Choo, the meetings are taking place at an ideal time, when Colombia’s global image has improved markedly from a decade or two ago, prompting widespread interest in Asian companies to begin exploring opportunities to set up business in the Andean nation.

Negotiations for the Colombia-South Korea FTA began in late 2009 and since then, the two countries have had four formal rounds of talks and three more informal “mini-rounds” as described by Choo. Of the FTA’s proposed 22 chapters, negotiators have agreed on the terms of 12 but they have come to a deadlock regarding the specific terms of import duties: Korea is worried about the effects that Colombian dairy products and meat could have on its domestic market, while Bogotá wants to ensure the import of Korean cars and white goods don’t undermine its own domestically assembled products. Nonetheless, bilateral trade between the two has more than doubled since talks began almost two years ago, from US$900m in 2009 to US$1.9bn in 2010. Furthermore, to July 2011, bilateral trade has expanded by a further 30% and officials from both sides believe it could close 2011 at US$2.5bn.

In Tokyo, President Santos and the Japanese Prime Minister, Yoshihiko Noda, signed an agreement for the reciprocal promotion and protection of investments. This document, which was three months in the making, is expected to spearhead Japanese foreign direct investment in Colombia, which reached US$39.4m in the period between 2001 and 2010. Most Japanese investment in the Andean country has been destined for commerce (73%) and the services industry (13%).

With regards to commerce, the record Japanese-Colombian bilateral exchange took place in 2007 (US$1.38bn) but it had been sliding since. That is, until the massive earthquake that hit Japan earlier this year forced the Asian nation to seek alternative sources of energy to address the shortages produced by the nuclear disaster at Fukushima. Colombia’s carbon industry benefitted from added Japanese demand –Carbon is also one of Colombia’s main exports to Korea- which has promised to help bilateral trade in 2011 reach a new record. Until July, bilateral trade had reached US$1.04bn.

Just like Korea, Japan wants to go beyond trade and the Asian nations could become crucial in aiding technological transfer from Asia to South America. Since 2007, a pilot programme with Colombia’s ministry of information technology and communications (TIC) has made it possible for 15 Korean technology teachers to tutor primary and secondary school age children in Colombia. Other education agreements, including the establishment of an Educational Broadcasting System (EBS) are slated for completion during Santos’s visit.

• Striking out zeros

It emerged in mid-September that the Colombian congress may soon consider a bill (34/2010) which proposes the creation of a Nuevo Peso Colombiano. If approved, lawmakers would strike three zeros out of the current Peso as well as begin a process whereby the material used for the country’s coinage would also be replaced. According to local experts, the cost of the materials for making Colombian Peso coins is far higher than the value of the coins themselves. Those who oppose the measure, traditionally aimed at tackling soaring inflation (i.e. Argentina, Brazil and Mexico did it in the 1990s), say the government will incur an unnecessary cost; the law’s defenders say the change should be made now, when inflation is under control and the government has the funds to bankroll the public information campaigns necessary to promote the change.

President Dilma Rousseff insists that Brazil is ‘armoured’ against the continuing global turbulence and has encouraged Brazilians to “keep on producing and consuming”. “Now is not the time to tremble”, she encourages. Brazil’s domestic market, which accounts for around two-thirds of GDP (compared with just 13%-14% for exports), was its saving grace in the 2008-2009 crisis.

With virtually full employment and steady wage and credit growth, local consumer confidence remains relatively positive. A 7.5% real increase in the minimum wage in 2012, allied to additional public spending ahead of municipal elections and the 2014 World Cup, should keep the economy ticking over.

As widely trailed in advance, the national statistics institute officially reported zero real GDP growth on a quarterly basis in the three months to end September. In fact, there was actually a slight contraction of 0.04%. The annual result was 2.1%, the weakest since Q3 2009. Private consumption fell 0.08% quarter-on-quarter in line with earlier official measures to cool down the overheated domestic economy. In line with this, imports fell 0.37%. On the bright side, the result shows that the official policy levers work efficiently. President Rousseff said as much on 6 December, “GDP, which we deliberately had to slow down, still grew at about 3.2% [in 2011]. And that’s no small thing, given the crisis in the US and Europe”.

Monetary policy has now reverted to stimulus mode, which should kick in from the fourth quarter, helping to offset a weakening external sector. As expected, Brazil’s central bank cut the benchmark Selic interest rate by 50 basis points to 11% on 30 November, the third such reduction since August. “The central bank understands that by mitigating in a timely way the effects of a more restrictive global environment, a moderate adjustment in the base rate is consistent with a scenario in which inflation will converge to the target in 2012”, the bank’s monetary policy committee said in a statement. Annual inflation is slowly inching down from 7% to the target ceiling of 6.5%, though the core inflation nucleus, which excludes volatile food and energy prices, remains quite sticky (at just under 7%).

The move coincided with a coordinated monetary action by central banks in the US, Europe and notably also in China, to flush additional liquidity into local markets, with a view to shoring up the struggling Euro zone. Brazilian policy makers are keeping a close watch on the country’s main trading partner, China, which on 29 November reported the first contraction in its manufacturing index (PMI) in three years. The Rousseff administration also has room for manoeuvre on the fiscal side and thus, even if Brazil enters a technical recession, it should be short-lived.

That is not to say Brazil is immune – its high dependence on external financing makes it very vulnerable to external shocks of the magnitude unfolding in Europe. However, there is no sign, yet, of corporate deleveraging, despite a global investor rush to safe havens and orders from European corporate and banking HQ’s to pull back funds in order to cover obligations at home. Indeed, the central bank reported a net inflow of dollars into Brazil in October. And on latest data, between 1 January and 26 November 2011 net currency inflows were positive to the tune of US$68.85bn, on the back of a net financial inflow of US$26.3bn and a trade inflow of US$42.58bn. In the same period of 2010, the net inflow was US$24.79bn.

In 2008, the government stepped in and ordered state banks to maintain credit to the private sector to offset such outflows, providing a critical cushion of support for local producers. On 13 December President Rousseff rebuffed suggestions that Brazil could have credit problems in 2012. “Our credit situation is very advantageous. We are a country capable of facing the worst scenario”.

• Forecasts slip

The government admits that GDP growth will be less than 4% in 2011, with inflation edging back towards the target ceiling ( 6.5%). The central bank’s indicator of economic activity (IBC-Br) fell 0.32% month-on-month in October, the third consecutive contraction. It grew 3.04% in the first 10 months of the year. The government still expects real annual growth of 5% in 2012, above the local private sector consensus of 3.4%.

El fue conocido alguna vez como el alto comisionado para la paz de Colombia; sin embargo, de la noche a la mañana, Luis Carlos Restrepo se ha convertido en uno de los fugitivos más famosos de Colombia. Su notoriedad no es tanto el resultado de la gravedad de sus delitos –muchos líderes guerrilleros y paramilitares han cometido algunos mucho más atroces– sino por las implicaciones políticas que su procesamiento y subsiguiente decisión de huir han tenido, y continuarán teniendo, en el corto plazo.

Ha sido claro ya por algún tiempo, que el ex presidente Álvaro Uribe (2002-2010) y muchos de aquellos que fueron miembros de sus administraciones ahora constituyen la fuente más fuerte de oposición al Presidente Juan Manuel Santos. El problema es que al declararse ellos mismos como perseguidos políticamente en las cortes, alegando que no hay garantías judiciales en Colombia, están proveyendo una defensa para los mismos criminales que ellos alguna vez estaban tan determinados en aprehender.

Si, de hecho, no hubiese garantías para los llamados Uribistas, entonces los líderes de las Fuerzas Armadas Revolucionarias de Colombia (Farc) y otros grupos de guerrilleros o paramilitares también podrían afirmar que ellos no están siendo juzgados por sus acciones sino por sus convicciones ideológicas. Uribe siempre buscó evitar esto cuando estaba en el poder acusando a la justicia de Colombia, y a la corte suprema en particular, de practicar una ‘justicia selectiva’ al perseguir a políticos Uribistas, por ejemplo, con lazos con los paramilitares en vez de políticos con lazos con las guerrillas. Sin embargo, existen crecientes  dudas desde que dejó el poder, acerca de su legado de seguridad, y la verdadera extensión de sus logros.

En meses recientes, Restrepo no ha asistido a al menos ocho procedimientos legales formales, incluidos dos relacionados con acusaciones que él había impuesto contra el esposo de la fiscal general. Restrepo aún debe responder sobre su supuesto rol en la organización de desmovilizaciones falsas en el 2006, y él ahora está prófugo en relación a ese caso. La fiscal general también presentó un cargo por contumacia, el desprecio deliberado de una orden o citación de una corte, lo que significa que Restrepo podría ser procesado en la ausencia.

El 9 de febrero, las autoridades locales de inmigración confirmaron que Restrepo había abandonado el país y, aunque se cree que voló a Nueva York, es improbable que ese sea su destino final si busca eludir el proceso. Colombia ha deportado docenas de delincuentes para afrontar la justicia en EU, incluyendo a altos líderes paramilitares que rehusaron testificar acerca de los delitos que cometieron como parte del proceso de desmovilización dirigido por Restrepo (2005-2006). El gobierno de EU probablemente cumpliría  con cualquier pedido de extradición solicitado por Colombia sobre Restrepo, para así evitar poner en riesgo las futuras extradiciones de otros delincuentes buscados por EU y también para indicar su fe en la integridad institucional de la justicia colombiana.

Buscar asilo en otra parte no sería una alternativa original a la de afrontar las cortes en Colombia; otros dos miembros de la administración Uribe ya han recurrido a esto: 1) la ex directora del servicio de inteligencia (DAS), María del Pilar Hurtado (2007-2008), que voló a Panamá; y 2) el ex ministro del interior, Sabas Pretel de la Vega (2003-2006), quien intentó suerte con Costa Rica pero su refugio seguro le fue negado.

Sin embargo, Restrepo rompió todos los moldes al enviar un USB, que contenía una carta abierta enviada “desde su escondite” al think-tank Primero Colombia, asociado muy de cerca con Uribe; la estrategia parece estar más en línea con las técnicas de comunicación empleadas por las Farc que con las del hombre que antes estaba a cargo de asegurar la desmovilización de ese y otros grupos ilegales armados.

La carta de Restrepo afirma que el Partido de la U (PU) debe “reconocer que el Uribismo cometió un error cuando escogió a Santos. En el 2010 se ganaron las elecciones, pero se perdió el gobierno”. Restrepo continua pidiendo el lanzamiento de una campaña en contra de la reelección de Santos, que el mismo presidente ha declarado repetidas veces que no buscará, y para empezar “un proceso abierto a fin de hallar tres candidatos para el 2014: a) un candidato presidencial; b) una cabeza de la lista para el senado; c) una cabeza para la lista de una asamblea nacional constituyente” (ver abajo).

• Una reforma constitucional a medida

La carta de Luis Carlos Restrepo también dice que una asamblea constituyente debería tratar  “una reforma de [el sistema] de justicia para dar garantías legales a los miembros de las fuerzas públicas y poner fin al carrusel de pensiones y corrupción en los tribunales y las cortes” –sugiriendo implícitamente que los actuales procedimientos legales contra él no son nada más que una persecución política dirigida por jueces corruptos en la nómina salarial de delincuentes, una teoría presentada varias veces por el ex presidente Uribe.

The government underpinned its confidence that peace talks with the Fuerzas Armadas Revolucionarias de Colombia (Farc) in Havana can be concluded this year by calling for a social forum on political participation, the second point of the peace process, to be set up for the end of April. The Farc, however, is not working to this deadline and seems content to string out the first point of the talks on land reform. After maintaining that it was close to an accord over land last week it fleshed out a controversial demand it first made last February - an expansion of peasant zones (ZRC) in Colombia to comprise 9.5m hectares (ha) of national territory with sweeping autonomy in running their affairs. The government negotiating team cannot acquiesce to such a huge demand.

The head of the Farc negotiating team Luciano Marín Arango, alias “Iván Márquez”, also called for all political sectors, trade unions and social organisations to get ready for a forum on political participation in Colombia in April, suggesting that there would be many more working tables on this than the agrarian forum last November. However, in contrast to the government, the Farc does not appear to think it is necessary to conclude the first phase of the talks over land reform before moving onto this phase, as it keeps tabling new demands on land reform, which are likely to prove politically unpalatable for the government, just as both sides suggest a deal is within sight.

Márquez read a message on a video put up on YouTube insisting that the government dramatically expand the ZRC, a land redistribution programme established in 1994 for small farmers, free of big agro-industrial and mining projects. There are currently six ZRCs comprising 831,000 ha and supporting 75,000 people, and the State is considering seven more. The Farc called for 59 in total covering 9.5m ha. Márquez’s message coincided with a ZRC meeting on 22 and 23 March in San Vicente del Caguán, the former demilitarised zone controlled by the Farc in the southern department of Caquetá.

Small farmers gathered in San Vicente del Caguán called for a land registry, a national finance fund for ZRCs and “territorial autonomy”. They played the video message from Márquez saying that the ZRC should be demilitarised, financed by the government, and given full political, economic and cultural autonomy like indigenous and Afro-Colombian territories. Government ministers immediately criticised the idea, arguing that not even departments enjoy this sort of autonomy and that it would create “a mosaic of little independent republics” in contravention of the constitution which could become lawless safe havens for illegal armed groups. The government is also insisting that as demilitarisation was never on the original agenda for the talks it is not up for discussion.

Márquez called for the government to lift “the inquisitor’s veto and war plans of the defence ministry”. Márquez has been at odds with the defence minister, Juan Carlos Pinzón, for some time. “I don’t know what function the government has assigned to this war minister… it seems the mission he has been assigned is to fulminate against the peace process, firing like a sniper on peace efforts,” he said earlier last week. He accused Pinzón of butting in over land reform talks, an area that should fall within the competence of the agriculture minister. The verbal sparring picked up after the Farc claimed responsibility for the killing of at least 16 soldiers on 5 March in the southern department of Cauca. Pinzón denounced this as a lie and accused the Farc of inventing it to give the appearance of strength. Márquez responded by claiming that the defence ministry concealed many other Farc actions to downplay the severity of the armed conflict.

Free houses

President Juan Manuel Santos tweeted on 21 March that “we signed the final three construction contracts for 100,000 free houses” for “the poorest of the poor” which he promised in August 2012 to build by the end of his mandate two years later. The latest contracts were for 100 houses in El Salado, in the northern department of Bolívar, the scene of the massacre of 60 civilians by paramilitaries in 2000. Much of the construction is funded by assets seized from captured leaders of illegal armed groups, most recently US$33.2m from the Norte de Valle cartel leader, Carlos Ramírez Abadía. The State will also be able to count on the fortune of the Farc leader, Guillermo León Sáenz, ‘Alfonso Cano’, who was killed in November 2011 (US$293,000, 17,500 euros and Col$242.7m) after the attorney general’s office concluded that it was derived from illicit activities.

En un giro de eventos ya familiar, una masiva manifestación de maestros de Rio de Janeiro el 7 de octubre, se volvió violenta. Decenas de miles de personas asistieron por la tarde a la concentración en el centro de la ciudad, una semana después de que la policía militar fuera acusada de brutalidad en su represión de la demostración de los maestros contra la aprobación de las políticas de educación del alcalde por el concejo de la ciudad. Por la noche, unos pocos cientos de activistas violentos (del llamado ‘bloque negro’) se aprovecharon de la respuesta policial más cautelosa para atacar edificios. Fueron destruidas más de 20 sucursales bancarias, un autobús fue quemado y el edificio del consejo fue atacado. La policía respondió con gases lacrimógenos y bombas de humo. Una protesta similar en São Paulo, convocada en solidaridad con los docentes de Rio, también se tornó violenta.

Los miembros del principal sindicato de maestros de la ciudad de Rio de Janeiro, el Sindicato dos Profissionais de Educação (Sepe), han estado en huelga por más de dos meses. Sepe representa a alrededor del 40% de los maestros en la ciudad, pero de acuerdo con las propias estimaciones del sindicato, alrededor del 60% de maestros de  las escuelas públicas están en huelga.

El alcalde, Eduardo Paes, celebró una reunión el 8 de octubre con su secretaria de educación, Cláudia Costin, los asesores de los maestros y padres de los alumnos, en un intento por hallar una salida. El 9 de octubre la secretaria general del Sepe, Marta Moraes, dijo que el sindicato no había sido invitado a las conversaciones. Más tarde ese mismo día, Sepe votó para continuar su acción de huelga.

Aunque una parte sustancial de las demandas de los maestros es el incremento salarial, hay también un elemento ideológico en las protestas. Bajo Paes, la ciudad ha estado experimentando con una asociación pública-privada en la educación. Alrededor de unas 28 escuelas fundacionales han sido establecidas en la ciudad, principalmente por grandes organizaciones comerciales, tal como el conglomerado de medios O Globo.

Sepe alega que estas escuelas están socavando la profesión, alentando a los maestros a dictar clases sobre un amplio rango de asignaturas, en vez de concentrarse en sus áreas especiales de conocimiento. Costin, una economista por entrenamiento, quiere expandir el modelo.

El ‘bloque negro’ ¿afectará la Copa Mundial?

Tanto el gobernador del estado de Rio de Janeiro, Sergio Cabral, como el gobernador del estado de São Paulo, Geraldo Alckmin, defendieron el derecho de los maestros a la protesta, y el manejo de la policía militar de la subsecuente violencia. Pero subsecuentes protestas, probablemente sean más fuertemente vigiladas. El 8 de octubre el secretario de seguridad pública del estado de São Paulo, Fernando Grella Vieira, anunció la creación de una nueva unidad de la policía, compuesta de personal civil y militar, para hacer frente a los manifestantes. Grella dijo que la policía también estaría autorizada a utilizar balas de goma, por primera vez desde las protestas de junio. Después de fuertes críticas por su manejo agresivo de las protestas de la semana pasada, la policía de Rio de Janeiro fue acusada ​​de ser demasiado cautelosa en sus acciones del lunes a la noche. Muchos de los bancos atacados ahora están demandando a la municipalidad en busca de compensaciones.

Priscilla Pereira Pinto, la directora ejecutiva del think-tank liberal instituto del milenio, con sede en Rio, que ha estado estudiando las protestas de los últimos meses, sostiene que hay pocas posibilidades de que los activistas del ‘bloque negro’ perturben la Copa del Mundo del próximo año. “Ellos explotan las quejas contra las políticas públicas para transmitir su mensaje anti-capitalista”, ella dijo. "Ellos siempre secuestran las protestas legítimas, como la protesta de los maestros. Es por eso que no creemos que vayan a alterar la Copa del Mundo. El año que viene también es un año electoral, así que no creo que el gobierno tolere grandes manifestaciones. Creemos que el ‘bloque negro’ no va a querer salir a protestar solo, porque correrían el riesgo de ser arrestados”.

• ‘Amarildo no tiene la marca de las UPP’

La extensa red de favelas en la zona norte de Rio, el Complexo do Lins, fue tomada por las fuerzas de seguridad el domingo, en la primera pacificación desde que 10 oficiales de policía de la unidad de pacificación (UPP) de Rocinha fueron acusados de la tortura y asesinato de Amarildo da Souza. Aunque uno de los oficiales de policía resultó muerto y otros dos heridos el día anterior a la operación, el mismo día de la operación, esta pasó sin que se haya disparado un solo tiro. Poco después, el gobernador Sergio Cabral dijo que la operación había sido un éxito y que el caso Amarildo no era indicativo de la calidad del trabajo policial en las UPP. Investigaciones de tales delitos sólo serán posibles cuando las comunidades estén pacificadas, agregó.

Ecuador’s constitutional court has thrown out three separate legal challenges against the communications law approved in June 2013 and ratified by President Rafael Correa in mid-January. On 17 September, the court ruled that the law was entirely constitutional. This was the final court of appeal, meaning that there can be no further challenge to the controversial law, which the private media, supported by opposition politicians and academics, has criticised as a draconian measure specifically designed to restrict criticism of the government by curtailing freedom of expression.

The media regulator, Consejo de Regulación y Desarrollo de la Información (Cordicom), which was created under the new communications law, described the court’s resolution as “historic”, and said that it “breaks with a past of media concentration and opens the way to a change of epoch with a pluralist and democratic focus”. It argues that the sole purpose of the law is to ensure that everyone should be able to express their point of view under equal conditions, with equal opportunities.

Fundamedios, a local NGO, rejected the constitutional court’s resolution, arguing that it signified “the legal consecration of exceptionally serious setbacks for fundamental rights and liberties contained within the (communications) law.”

The law was challenged by 60 people from the world of journalism, civil society, the arts, culture and academia, and Luis Fernando Torres, a legislator for the opposition Movimiento Creo. The first challenge was made by Diego Cornejo, director of the Asociación Ecuatoriana de Editores de Periódicos, who denounced the court’s resolution as “a scandalous decision showing its affinity with the government, which weakens democracy in Ecuador”. He had argued that the new law has been applied to muzzle the press, slapping punitive fines on opposition media, demanding constant ‘rectifications’, and undermining freedom of expression.

A second challenge was brought by Farith Simon, a professor at the legal clinic of the Universidad San Francisco de Quito, who said he was “not in the least surprised... as the court has favoured the government on almost every issue”; while Deputy Torres opposed the law on procedural grounds, insisting that various of the articles incorporated into the final version were never actually debated in the national assembly, and that “substantial modifications to what was debated” were also made.

Hoy falls silent

Ecuador’s national daily Hoy has ceased to be after 32 years of publishing. The regulator, Superintendencia de Compañías, stepped in, saying that Hoy would be wound up after making losses in excess of 50% of “social capital” for two consecutive years. The print version of Hoy had already been suspended on 29 June, but the online version fell silent on 26 August.

In one of the paper’s final editorials, the director of Hoy, Jaime Mantilla, blamed the tough strictures in the new communications law, which he said had made it difficult to find national investors, as well as “economic asphyxiation” from an advertising boycott by the State; and the cancellation of contracts to print school textbooks.

The chairman of the Inter American Press Association (IAPA) Committee on Freedom of the Press and Information, Claudio Paolillo, who is editor of the Uruguayan weekly Búsqueda, accused the government of “conspiring against the public’s right to enjoy pluralist debate and access distinct points of view.” In July, Paolillo blamed President Correa for the collapse of the print version, maintaining, “This is no different to what other fascist governments have done throughout history”.

• Bonil

Ecuador’s most famous cartoonist, Xavier ‘Bonil’ Bonilla, became the first person to fall foul of the new communications law, on 31 January this year. The superintendent of information and communication, Carlos Ochoa, said a cartoon by Bonil published in the national daily El Universo on 28 December 2013 was defamatory, damaging the image of the attorney general’s office and the judicial police, and promoting social unrest.

Authoritarian regimes are typically defined by what separate them from democracies. Most often, they lack fundamental democratic attributes including protecting, enforcing, and promoting citizens’ rights, ensuring a separation and independence of powers in all branches of government, and supporting security forces that are accountable and loyal to a constitution, not a party. Human rights groups and think tanks such as the US-based Inter-American Dialogue argue that under the current Frente Sandinista de Liberación Nacional (FSLN) government led by President Daniel Ortega, Nicaragua has come to fit this definition almost to a tee.

• Democracy Index

Based on analysis of data up to the end of 2017, The Democracy Index, compiled annually by the UK-based Economist Intelligence Unit (EIU), registers the Nicaraguan government as a ‘hybrid regime’, which has significant weaknesses but is not yet classed as ‘authoritarian’. However, it will be interesting to see how the regime is ranked in the next issue, which will include analysis of the events in 2018.

In 2016, President Ortega won his second re-election without facing legitimate opposition and despite widespread calls of election fraud. Since then, the FSLN government has held a monopoly in parliament (71 out of 92 legislators), the justice system (11 out of 16 magistrates), and the electoral system (seven out of 10 commission members), while also controlling the national army and police. He also sustains a mechanism of social control using street mobs, which he directs through the organised membership of the Sandinista Youth. They are individuals (now militarily) trained to intimidate and crush civil disobedience using any means. As documented by human rights organisations such as the Office of the United Nations High Commissioner for Human Rights (OHCHR), these mobs have been responsible, through tacit police support, for many of the deaths since mid-April, following clashes over the newly proposed pension reform.

It is now becoming increasingly clear that recent protests reflect the anger of the Nicaraguan people towards what many describe as an environment of systematic corruption and abuse of authority that has spanned almost 30 years. As tensions between the government and protestors persist, the pro-Ortega justice system is enabling the use of repressive force causing the deaths of over 300 people since 19 April 2018. In July the legislature approved an anti-terrorism law which can be used against protesters, leaving unprotected the constitutional right to freedom of expression for all Nicaraguans, which has also prompted concerns from human rights groups. In fact, pro-government judges have been put in charge of prosecuting demonstrators, while organisations like the Inter-American Commission on Human Rights (IACHR) report that doctors, nurses, and educators have been sacked for tending to wounded demonstrators. However, the chaos in Nicaragua today is a direct result of a series of moves to undermine democracy dating back to the beginning of Ortega’s rise to power.

Controlling justice institutions as a means to secure power

A key criticism levelled at Ortega is that the denial of plurality in political identity and a lack of checks and balances across all powers are part of a conscious effort to establish a singular and uncontested authority. Nicaragua lacks proper access to impartial judges and a fair rule of law. This situation can be traced back to the Sandinista revolution which opened the door to a system of transactions of power by bribing or blackmailing opponents to reach a majority in courts.

After his defeat in the 1990 elections, Ortega took advantage of constitutional reform in 2000 based on a pact with then-president Arnoldo Alemán (1997-2002) and gradually increased the number of supreme court (CSJ) justices. Because the FSLN-controlled legislature voted to approve candidates, it chose FSLN judges, expanding their numbers over the next 15 years. To achieve constitutional and legal reform, Ortega again used the threat of street mobs while simultaneously creating pacts with other political parties by buying their loyalty. Using this strategy, by 2000, 12 out of 16 CSJ magistrates, also charged with appointing district judges, were Sandinista.

At the same time, between 1990 and 2016, various pivotal and controversial judicial cases were decided in favour of Ortega. In particular, two critical cases secured his near absolute monopoly of power once president. First, Ortega pressured the CSJ in 2010 to reverse article 147 of the Constitution, allowing him to legally run for re-election. Then, in his run for a second re-election six years later, he ordered the CSJ to remove Eduardo Montealegre as the legal representative of the leading opposition party, Partido Liberal Independiente (PLI), only four months before the elections. As a result, the party was left fragmented and without a candidate, allowing Ortega to win an uncontested 72% of the votes. By then, he had secured his legal footing by controlling any legal challenge and by using the courts to his advantage.

Moving forward, transitional justice a lo Nica

The extent of authoritarianism and corruption in the government can help explain the frustration and anger that has recently exploded in the country. (It is worth recalling that the latest [February 2018] Corruption Perceptions Index (CPI) by the NGO Transparency International showed Nicaragua ranked beneath its Central American neighbours, coming 151^st of 180 countries, down from 123^rd the previous year). The protestors’ demands suggest a political transition for Nicaragua is necessary, with justice reform a centrepiece of it. Above all, the transition must include the re-establishment of democratic rule through free and fair elections, accompanied by a comprehensive effort to ensure the independence of political institutions. To achieve this, think tanks like the Inter-American Dialogue argue that it is crucial to create transparent and democratic procedures in all branches of government with the help of an independent international committee which could be supplemented by establishing an oversight committee to supervise all administrative and political decisions.

Once this occurs, the establishment of a transitional justice mechanism to create an accurate historical record of events dating back to the 1980s is likely to be considered key. More than 500,000 Nicaraguans were internally and externally displaced due to the civil war and more than 45,000 people lost their lives. When a peace settlement was negotiated, the two main goals were establishing free and fair elections and disarming the Contras while reducing the size of the Sandinista army. Although those steps were imperative, there were no investigations of abuses perpetrated by both sides and no mechanisms put in place to address redress for victims. This was most evident during the transition period under President Violeta Chamorro (1990-1997), when various investigations into political assassinations led by Sandinista courts failed to yield any verdicts, despite evidence of Sandinista security forces’ involvement.

• Retributive justice

As we have seen in other countries in the region such as El Salvador, and Guatemala with the United Nations (UN)-backed anti-impunity commission in Guatemala (Cicig), retributive justice can substantively contribute to building trust and restoring an impartial justice system in the long-run. A similar programme would enable Nicaragua to hold accountable those responsible for political corruption and physical violence over the last 40 years and address the concerns of demonstrators and the organised non-violent opposition in the streets today.

The failure to attend to past and continued abuses has created resentment among Nicaraguans across generations and fuelled political mobilisation against the Sandinistas and Ortega to this day. The civil war was fought with a deep sense of division and hatred and many returned to their homes after the war sharing their day-to-day lives with adversaries without the opportunity to heal wounds, achieve justice, and bridge the divide. Addressing this resentment by establishing the truth and acknowledging the pain of victims and their families, although difficult, would be a key step in achieving justice and reconciliation, something many Nicaraguans have been denied for decades.

However, the first step in this transition is investigating the recent abuses perpetrated by the government including political and economic corruption (including nepotism) and the use of repression and violence. Those who have participated in the deaths of protestors since the beginning of 2018 should be prosecuted without the possibility of amnesty. The political value of amnesties for Nicaragua is substantively limited when this instrument has been used and abused in the past to satisfy impunity.

URUGUAY | Arbeleche defends five-year budget proposal before senate. On 26 October Uruguay’s finance & economy minister, Azucena Arbeleche, presented the government’s five-year budget proposal to the senate tax and budget committee, following its approval by the chamber of deputies on 16 October.

In her appearance before the committee, Arbeleche underlined the need for increased growth and employment following the damage wrought by the coronavirus (Covid-19) pandemic, which the government expects will result in GDP contracting 3.5% in 2020, with inflation forecast to close this year at 9.5%. However, she insisted that there would be no tax increases.

At a press conference following the presentation, Arbeleche said that “this is a budget without tax hikes, as was promised in the election campaign, despite the fact that the fiscal situation we inherited remains complex”, a situation compounded by the pandemic.

Arguing that public services such as healthcare and education could be improved by redirecting funding, rather than raising taxes, Arbeleche acknowledged that “we’re going to have a fiscal deterioration in 2020 due to the measures to confront the epidemic and to reduce economic activity and growth”. She added that “from 2021…there will be a fiscal improvement based on government savings”.

• Fiscal deficit

The Uruguayan government expects the fiscal deficit to reach 6.5% of GDP by the end of the year, dropping to 4.1% of GDP in 2021, which it hopes to have reduced to 2.5% of GDP by 2024, President Luis Alberto Lacalle Pou’s last full year in office. 

BRAZIL | FDI plummeting. The United Nations Conference on Trade and Development (Unctad) published a new report on 27 October, according to which foreign direct investment (FDI) to Brazil collapsed in the first six months of 2020.

Brazil attracted a total of US$18bn in FDI between January and June, a 48% decline on the same period in 2019 which the Unctad attributes to the stalling of the government’s privatisation programme with the onset of the coronavirus (Covid-19) pandemic.

The decline in FDI to Brazil is almost double that for Latin America and the Caribbean as a whole, which saw a fall of 25% over the first half of 2020. The latest data from Brazil’s central bank (BCB) confirms this trend; FDI to the country in the 12 months to September 2020 totalled US$50bn, or 3.31% of GDP, the lowest level since July 2018.

A dinner in an up-market Mexico City (CDMX) restaurant, and a luxurious wedding celebration in Guatemala, have triggered two separate scandals, both of which may weaken the anti-corruption efforts of the government of President Andrés Manuel López Obrador.

Emilio Lozoya, former director of state oil company Pemex (2012-2016) and close associate of former president Enrique Peña Nieto (2012-2018) must regret dining at Hunan, an up-market Asian food restaurant in CDMX on 9 October. Photographs of him sitting at a table and talking with friends eventually found their way onto social media and triggered a major political storm. This, because Lozoya stands accused of taking at least US$10m in bribes from Brazilian construction company Odebrecht while head of Pemex. Under investigation, he was extradited from Spain in July 2020, nearly a year and a half ago. Many Mexicans asked themselves how such a high-profile rule breaker could still be out of jail and living the good life?

The answer is that for over a year Lozoya had been negotiating the Mexican equivalent of a plea-bargaining deal, during which he had been allowed relative freedom of movement in CDMX, while wearing an electronic tag. He had offered testimony that on Peña Nieto’s orders, the Odebrecht money went towards funding election campaigns by the centrist Partido Revolucionario Institucional (PRI) and was also used to bribe members of congress to ensure they would vote to support Peña Nieto’s liberalising energy industry reforms.

For President López Obrador, Lozoya’s hoped-for testimony could be political gold. The president accuses his three predecessors of being part of a corrupt “neo-liberal” elite and is trying to reverse Peña Nieto’s energy reforms. He has made no secret of his belief that Peña Nieto and other former presidents should face trial. Indicting one or more former presidents would be seen as a major political victory for his government. In addition, prosecutors accuse Ricardo Anaya of the right wing Partido Acción Nacional (PAN) of taking a bribe to vote in favour of the energy reforms. Anaya, who is a potential presidential contender in 2024, has moved to the US to escape what he says are trumped up charges that amount to political persecution.  

From López Obrador’s point of view, the problem has been that plea bargaining negotiations have dragged on and Lozoya has so far not produced the evidence prosecutors need. The restaurant incident forced a change in approach. The attorney general’s office (FGR) told a CDMX judge that Lozoya must now be considered a flight risk. On 3 November the judge agreed, ordering Lozoya’s immediate preventive detention. With the press in attendance, the former Pemex head was taken from the court directly to the Reclusorio Norte prison. The judge did however give the FGR and Lozoya’s legal team another 30 days to see if they could strike a plea-bargaining deal. Lozoya’s lawyers have since offered to pay a US$5m bond (part of which would be in the form of a property worth US$3.4m) in exchange for his release.  

A second scandal then emerged, based on an unlikely location: the colonial city of Antigua in Guatemala, where a luxurious wedding had been held. The groom and bride were both prominent Mexicans, but the celebrations quickly turned sour.  On 8 November it was announced that the groom, Santiago Nieto, head Mexico’s financial intelligence unit (UIF) had resigned. Nieto, until recently a close confidant of the president, had married Carla Humphrey, a senior official at Mexico’s national electoral institute (INE). The scandal was that the Guatemalan authorities had seized US$35,000 in cash from one of the guests, later identified as Juan Francisco Ealy Ortiz, president of Mexican newspaper El Universal. The newspaper later said the money was for medical treatment and had been properly declared. However, the incident remained somewhat unclear: another guest, CDMX tourism minister, Paola Félix Díaz, was reportedly arrested by the Guatemalan authorities who accused her of illegally trying to carry a large sum of money into the country. Félix denied any wrongdoing but presented her resignation to the head of the CDMX government, Claudia Sheinbaum, another potential contender for the presidency in 2024. Sheinbaum quickly accepted the resignation, saying Félix’s main error had been to travel to Guatemala by private jet, something that ran counter to the government’s principles of “austerity, honour and transparency”. She added “here, nobody can get on a private jet”.

The departure of Nieto, in effect the country’s top anti-corruption official, is a setback for the government and has been linked to various internal factional struggles. Nieto is reported to have earned the enmity of Alejandro Gertz, the controversial attorney general (head of the FGR). Asked by the president to prepare a report on a long-running family feud for control of Universidad de las Américas Puebla (UDLAP) he had advised that Gertz, with personal ties to a rival university (UDLA) had a conflict of interest.

There are also credible claims that the wedding scandal was ‘spun’ by rival media teams linked to the two main candidates within the ruling Movimiento Renovación Nacional (Morena) to succeed López Obrador in 2024: Sheinbaum and foreign minister Marcelo Ebrard. Nieto was regarded as being close to Ebrard (who had been invited to the wedding but did not attend). Since deputy foreign minister Maximiliano Reyes did attend, the Ebrard camp felt criticism of the wedding was deliberately targeting their man. Separate press briefings concerning Félix’s alleged involvement in carrying cash were therefore seen as a countermove intended to hit back at Sheinbaum.

López Obrador, who as recently as October had been fulsome in his raise for Nieto, took distance from him, describing the wedding as “scandalous”. A few days later López Obrador said “Santiago Nieto is an honest professional, we respect him, but we cannot tolerate any act of extravagance nor any act which goes against republican austerity”. He may also have been angered because some of the guests attending the wedding were well known conservative figures, such as Josefina Vázquez Mota, of the right-wing PAN, who ran against him in the 2012 elections (both were defeated by the PRI’s Peña Nieto).

While separate events, both scandals suggest progress against corruption under the López Obrador administration is going to be limited. Pablo Gómez Alvarez, a Morena economist, politician, and former 1960s student leader, has been appointed as the new UIF head. While López Obrador appears to have a genuine commitment to personal austerity, both scandals highlight his instinct to seek political advantage from big corruption cases, effectively trying to override the independence of the judiciary so as to hit out at his opponents. The frontrunners to succeed him within Morena also seem to favour politicising the anti-corruption drive. Despite the talk of austerity, the president has done little to tackle underlying, structural causes of corruption. His claim that corruption “stopped`’ when he took office will be subject to increasing scrutiny.      

Surveys

Polls by lobby group Transparency International say that 44% of Mexicans believe corruption increased in 2020 relative to 2019, and 34% of respondents admitted to paying bribes to secure public services in the preceding 12 months.

Nicaragua’s recent authorisation of the request for political asylum from Panama’s former president Ricardo Martinelli (2009-2014) [WR-24-05] is stoking bilateral tensions after Panama refused to grant him safe passage. The decision casts further doubt on the future of the disgraced former president, who recently lost an appeal before the supreme court (CSJ) against a money laundering conviction, prior to which he had been the frontrunner ahead of May 2024 presidential elections.

On 7 February the Nicaraguan government led by President Daniel Ortega confirmed that it had granted asylum to Martinelli, citing “political persecution” and “imminent risk to his life”. This was in response to a request filed by Martinelli, days after the CSJ decision upholding a conviction handed down in July 2023 in relation to the 2010 acquisition of a media conglomerate, Editora Panamá América (Epasa) [WR-24-05].

However, on 9 February Panama’s foreign ministry said it had turned down the request regarding Martinelli, who remains in the Nicaraguan embassy in Panama City. The foreign ministry cited Article 1 of an Organization of American States 1928 convention on asylum, since updated in a 1933 convention, which states that “it shall not be lawful for the States to grant asylum in legations…to those accused of common offenses who may have been duly prosecuted or who may have been sentenced by ordinary courts of justice”. Panama’s foreign ministry warned that any action or declaration that Martinelli makes from the embassy that “impacts on Panama’s domestic politics will be seen as interference and have diplomatic consequences”. Nicaragua’s foreign ministry in turn issued a statement warning that “failure to recognise asylum and to deny safe conduct is a violation of the conventions on asylum” – citing the same conventions.

With Martinelli’s fate currently up in the air, Nicaragua’s decision to grant him asylum drew condemnation from the US and opposition figures who accuse the Ortega government of providing shelter to those seeking to escape justice. Writing on social media, US Assistant Secretary of State for Western Hemisphere Affairs Brian Nichols described the decision as “yet another move to undermine the rule of law and subvert justice”. Luciano García, an exiled Nicaraguan opposition leader in Costa Rica and director of civil society group Hagamos Democracia, was cited by Spanish daily El País as saying: “Ortega is not granting asylum to people facing political persecution or whose rights have been violated. Instead, he is providing shelter to convicted criminals who seek to evade accountability for the harm they caused in their respective countries”.

Other dubious requests granted

El País and Nicaraguan outlet Confidencial highlight that the decision to authorise asylum to Martinelli follows other requests granted which seemingly undermine the integrity of legitimate asylum. As well as former Salvadorean presidents Salvador Sánchez Cerén (2014-2019) and Mauricio Funes (2009-2014) [WR-24-05], Nicaragua last year granted asylum and Nicaraguan citizenship to two close allies of former Honduran president Juan Orlando Hernández (2014-2022), who is currently in the US and due to face drug and weapons related charges. The two were Ebal Díaz (his former minister of the presidency) and Ricardo Cardona (his private secretary). In 2021 Nicaragua granted citizenship to Gustavo Herrera, a Guatemalan businessman and political operator, having granted him asylum in 2018. Herrera appears on the US Corrupt and Undemocratic Actors list for using his authority to “inappropriately influence and manipulate the appointment” of justices.

Anniversary of prisoners’ release

A recent US State Department press release recalled that 9 February marked one year since the US received 222 political prisoners released by Nicaragua, who were since stripped of their Nicaraguan citizenship in absentia – a move subsequently applied to other opposition figures [WR-23-07]. The decision to strip the prisoners of their nationality on charges such as treason and conspiracy was widely condemned. At the time, the United Nations Refugee Agency (UNHCR) said the “reforms allowing for citizenship-stripping on arbitrary grounds run contrary to Nicaragua’s obligations under international and regional human rights law”. It pointed out that “international law prohibits the arbitrary deprivation of nationality including on racial, ethnic, religious or political grounds” and is clear that the exercise of fundamental rights, including freedom of expression, freedom of assembly, or other rights associated with a person’s political views, can never justify the deprivation of nationality.