MEXICO | Ortiz. The Bank for International Settlements, the central banks' central bank, appointed Guillermo Ortiz, the governor of the Banco de México, on 13 January, to be its chairman for the next three years. What is interesting is that Ortiz's current term as governor of the Banco de México expires at the end of this year. Ortiz's acceptance is widely seen as a challenge to President Calderón who has notoriously poor relations with him.
“I think it's important to recognise, given historic suspicions, that the United States' policy should not be interference in other countries, but that also means that we can't blame the United States for every problem that arises in the hemisphere."
- US President Barack Obama at the Summit of the Americas.
“I am a Marxist, Leninist, Communist, Socialist. Now expel me; I want the OAS to expel me."
- Bolivia's President Evo Morales offers his support for Cuba before the
Summit.
“We are concerned about people's lives but we are also
concerned about our country's life."
- Argentine Senator Miguel Pichetto, the head of the ruling party's senate bloc justifies the decision not to declare a national health emergency over a dengue epidemic.
The Organization of American States (OAS) will send a team of foreign ministers to Honduras “as soon as possible". Its mission will be to try and persuade the de facto government of Roberto Micheletti to accept the terms of the San José Accord, drawn up by Costa Rica's President Oscar Arias, which demands the return of ousted president Manuel Zelaya to power and a political amnesty, as well as several sweeteners for Micheletti. Negotiations have ground to a halt over the last week. Micheletti is more than happy to play out time. Zelaya is trying to keep the focus of the international community on his cause. He visited Mexico this week, where he won the support of President Felipe Calderón for his peaceful return to Honduras.
The secretary general of the OAS, José Miguel Insulza, said there was consensus over the need to send a team to Honduras. He was speaking after a private session of the permanent council. Neither the composition of the team (which Insulza said must be “balanced") nor the date of its departure has been discussed. Insulza hopes these details will be finalised quickly so that the mission can leave before 17 August when the Inter-American commission of human rights (IACHR) begins a four-day visit. Insulza stressed that the mission was “part of the mediation process" and was not designed to sideline Arias who, he said, would continue to play a pivotal role in breaking the deadlock.
The OAS deliberately snubbed Micheletti, who requested last week that the Ibero-American Secretary-General Enrique Iglesias head a mission to Honduras. It did not want to be seen adhering to the wishes of an illegitimate government. Its decision to send a mission at all, however, is a major victory for Micheletti. The OAS expelled Honduras when it failed to meet a 72-hour ultimatum after the coup to reinstate Zelaya, and when Insulza subsequently visited Tegucigalpa he was under strict instructions not to meet anyone from Micheletti's government for fear of conferring legitimacy on it. The tough response by the OAS was undermined by the US, which left its ambassador, Hugo Llorens, in Tegucigalpa to talk with Micheletti et al and sponsored the Arias mediation.
During his visit to Mexico on 4 August, Zelaya, who has publicly thanked US President Barack Obama for his support, picked up on the line being pursued by Cuban leader Fidel Castro in his “Reflections" - that powerful conservative groups in the US, “who talk about democracy while promoting dictatorships and almost terrorist activities", supported by hawks left over from the Bush administration, had backed the coup. Castro named his bêtes noires, Otto Reich and John Negroponte. He also included Llorens, a Cuban-American, as “part of the group of aggressive US ambassadors in Central America" all appointed by Bush in 2008. Zelaya did not name names. Indeed, he met Llorens in Managua last week.
Speaking in Mexico, Zelaya said he would accept the San José Accord provided he was returned to power, but he stressed that he was “not prepared to play a diplomatic game that delays the process of the restoration of democracy." He also accused Arias of being “very soft" on the Micheletti government.
Zelaya's posturing is not helping his cause: he keeps flip-flopping on the San José Accord, and his discourse on violence is completely inconsistent. On the one hand, he claims to be forming a “popular peaceful army" on the Nicaraguan border with Honduras to return him to power; on the other hand, he is calling for an insurrection in Honduras, and claims that unless the de facto government cedes power, “generalised violence" will spread across the country.
Micheletti says that the supreme court, congress, the electoral tribunal and the attorney general's office are all analysing the points in the San José Accord. A congressional commission approved an amnesty for political crimes this week (but not common crimes) if both sides agree on the accord. The electoral tribunal has refused to contemplate moving November's elections forward, however, and Micheletti's government is not budging on the main sticking point: Zelaya's return to power.
The new minister for the presidency, Rafael Pineda Ponce, who lost the party primary election for the Partido Liberal to Zelaya in 2005, said this week that Zelaya's return to power was “impossible". “There is a political position in Honduras of which a sine qua non condition is that Zelaya does not return to the presidency," he said.
The de facto government remains cautious about the threat of a pro-Zelaya uprising. It has lifted the overnight curfew, but pointedly not along the border with Nicaragua. It is also threatening those who “convene or direct any illicit meeting or demonstration" with up to a four-year prison sentence and a fine of “thousands of lempiras".
A fascinating column appeared in the Honduran daily La Tribuna on 1
August. It was written by Edmundo Orellana, the defence minister who resigned
the week before the coup to register his disagreement with President Manuel
Zelaya. Orellana is very forthright in his criticism of the coup, which is
interesting because it suggests the press is not fully muzzled. “Violations of
the constitution cannot be put right with another violation," he says.
“The supposed legality of the actions of this unlucky day
does not hold up to the most minor analysis when confronted with the
constitution," he says, before citing a handful of constitutional articles to
condemn the actions of congress and, particularly, the army. Judicial warrants,
he argues, should have been carried out by the national police, not the army
(Article 293), while the constitution prohibits that Hondurans should be
expatriated (Art. 102). Orellana calls for “all actors in this national tragedy"
to show “flexibility, equanimity, tolerance, humility, and rectification" and
accept the San José Accord.
Cuba's national assembly approved the creation of a new agency designed to crack down on corruption, which President Raúl Castro claimed had been undermining the Revolution. The new agency will be attached to the Council of State, which is presided over by Raúl.
Supporters of ousted president Manuel Zelaya have begun stamping Honduran money with statements opposing the coup: “No to the coup", “Micheletti out" and “Yes to the constituent assembly" are the most common messages being stamped on notes of various denominations. The central bank said that the action would cause “serious damage to the national economy" as the notes had to be taken out of circulation and new notes printed.
News of a domestic spying scandal broke this week which could cause irrevocable damage to the presidential ambitions of the mayor of Buenos Aires, Mauricio Macri. The head of the fledgling metropolitan police force, Osvaldo Chamorro, was dismissed and the man he recently replaced, Jorge Palacios, arrested for allegedly participating in a spy ring. This began with the illegal bugging of a relative of one of the victims of the bombing of the Jewish community centre (Amia) in 1994 and extended to journalists, legislators in the City of Buenos Aires, and possibly even President Cristina Fernández and her husband and predecessor Néstor Kirchner.
Palacios was appointed in July and resigned in August, a month before he was due to assume his new duties at the head of the newly formed 15,000-strong metropolitan police force. He said he was resigning for personal reasons but since then a federal judge, Norberto Oyarbide, tied him to the wiretapping of relatives of the victims of the Amia terrorist attack to obstruct the investigation into the bombing in which 85 people were killed. The tapping was carried out by an officer called Ciro James. Oyarbide said Palacios and James had established “a real Gestapo," an emotive claim, especially given the visit of Israel's President Shimon Peres to Argentina this week.
Macri had claimed that James was a “mole" planted by the government and the federal police to discredit his new metropolitan police force, but the investigation by Oyarbide has since discovered that the spying goes beyond the Amia case. This week details from a computer seized during a raid on the offices of a security agency owned by Palacios were revealed. This contained “very precise and personal" data and finances of trade union leaders, media moguls, journalists and City cabinet ministers. Legislators from the ruling Frente para la Victoria are calling on the City security minister to go and even for Macri to consider his position.
Argentina's President Cristina Fernández suspended indefinitely a visit to La Paz last week until an agreement over natural gas exports is reached. This also served the purpose of expressing her chagrin at the dissemination of a National Geographic map in Bolivian universities and other educational establishments on which the Falkland Islands are very clearly shown as belonging to Britain. The Argentine embassy in La Paz released a statement complaining that “the Islas Malvinas are shown in a different colour to Argentina […] and labelled Falkland Islands".
BRAZIL | GDP. Brazil's GDP fell by 0.2% in 2009, compared with a year earlier, according to figures from the official statistics agency (Ibge) presented by finance minister Guido Mantega last week. This was the first negative growth since 1992. The central bank's latest poll with market participants put GDP growth forecast for 2010 at 5.5%, compared with Mantega's forecast for 5.7% growth. Inflation is expected to reach 4.99% this year, above the bank's 4.5% target, leading the market to forecast the base interest rate will rise by 2.5 percentage points, to close 2010 at 11.25% annually.
CHILE | Copper. Copper exports increased by 106% in the first two months of the year to US$6.11bn as prices rebounded in the wake of the global economic recovery. The news comes just as the government is mooting increasing the mining royalty tax in order to meet an estimated US$30bn of earthquake reconstruction costs, equivalent to 18% of GDP. The current copper royalty tax of 5% - passed in 2005 after a fierce debate - brings in more than US$600m a year. Addressing senators from his coalition in a meeting in the presidential palace this week, President Sebastián Piñera proposed altering spending in the 2010 budget; using reserves; obtaining foreign credits; or getting assistance from the private sector through a donations law, before raising taxes. But, the finance ministry, which this week announced subsidies and no interest loans to assist the fishing industry (severely damaged by the tsunamis), said it was a “possibility".
The government sent a bill to congress this week to speed up the tendering process for World Cup projects following criticism from the Fédération Internationale de Football Association (FIFA). But the bill, which waters down rules regulating tendering procedures, raised concerns of possible corruption in World Cup projects, leading to another clash between the Lula administration and the Tribunal de Contas da União (TCU), the independent overseer of the government's accounts.
FIFA selected Brazil to host the 2014 World Cup in 2007 following a successful bid in which the administration of President Lula da Silva promised to carry out several infrastructure projects for an efficient running of the event. But, in May, FIFA's general-secretary, Jerome Valcke, criticised Brazilian authorities for not complying with the building and renovation schedule to complete football stadiums chosen to host the World Cup in 2014. “Why did you sign all the documents and fail to fulfil your commitments? This year nothing will happen because of the presidential election. Does it mean that nothing will start until after Carnival next year?" Valcke asked the Brazilian football association.
FIFA's criticism embarrassed the Lula administration, which promised to expand the country's outdated travel infrastructure, including financing the building of new hotels and, significantly, increasing Brazil's airport capacity. In order to speed up projects, the government sent a bill to congress relaxing rules regulating tendering procedures. Brazil's sports minister, Orlando Silva, explained that “the facilitation of the [tendering] process will allow us to overcome the difficulties [relating to] airport projects." But, Claudio Abramo, the chief executive of NGO Transparencia Brasil, which inspects government accounts, criticised the idea. “The relaxation [of rules regulating tenders] will make the tendering process more vulnerable to fraud," he said.
The elimination of bureaucracy and the speeding up of licences for infrastructure projects is, theoretically, positive, but the current affairs magazine Veja raised serious corruption concerns due to “the recent experiences of all those involved in the tendering process" to carry out improvements in Brazilian airports. The magazine was referring to a parliamentary investigation into Infraero, the state-owned company that administers all Brazilian airports, and several construction companies in 2007, which uncovered irregularities worth R$500m (US$277m), despite all the checks in place.
Currently, major improvement works at four Brazilian airports remain halted following orders from the TCU due to irregularities. But, the government now wants to hand as much as R$5bn (US$2.8bn) of public money to Infraero to carry out the promised works without proper TCU checks, fuelling concerns the money will be misspent, or worse, embezzled. This is particularly concerning in an electoral year, since a large part of money embezzled from public works is used to finance electoral campaigns illicitly.
This is not the first time the Lula administration has attempted to bypass the TCU, which has halted several projects in the government's infrastructure investment programme (PAC) over irregularities. In February, Lula accused the TCU of “causing losses" to Brazil after the body paralysed projects being carried out by the state oil company Petrobras [WR-10-05]. The TCU has its reasons for suspecting public money could be misused in World Cup projects. The organisation of the 2007 Pan American Games in Rio de Janeiro, for instance, ended up costing 10 times more than its initial budget, or R$4bn (US$2.2bn), after the government relaxed tendering rules due to “urgency" in completing all the infrastructure promised for the Games.
The Brazilian supreme electoral court ruled that politicians condemned by jury are ineligible for public office for a period of eight years. Congress had approved the new regulation, the so-called “clean record law", in early June, but only for cases relating to future condemnations. The court understood the rule was valid in cases of politicians already convicted, and therefore valid for this October's general election, stating the ruling was not retroactive since it would be applied at the moment a convicted politician registers his/her candidacy for this year's vote.
“After what happened in Honduras and now Ecuador, it is clear that democracy is an asset which if not looked after is not fortified: we could really return to the old era of coup d'états with no consequences for those that carry them out."
-El Salvador's President Mauricio Funes.
“Words blow in the wind but brotherhood among peoples endures
forever."
-Peru's President Alan García buries the hatchet with Bolivian peer
Evo Morales.
“If it depended on the press my approval rating would be less than
10%."
-Brazil's President Lula da Silva.
President Dilma Rousseff has put pressure on two of her ministers, Orlando Silva and Carlos Lupi, whose parties, the Partido Comunista do Brasil (PCdoB) and Partido Democrático Trabalhista (PDT), respectively, are demanding more space in her administration. A corruption scandal in Silva's sports ministry and the refusal of PDT congressmen to vote in favour of the government's 2011 minimum wage proposal served as perfect excuses for Rousseff to withstand demands from the two allied parties.
According to an article by the newspaper O Estado de São Paulo, there have been several irregularities in the management of programmes carried out by the sports ministry. The newspaper accused the PCdoB and Silva of granting million-dollar contracts to non-governmental organisations (NGOs) and other entities linked to the party - that either do not exist or that lack the logistical conditions to operate sports programmes for the poor - in order to channel public money to pay for the party's campaign debts.
The newspaper carried out an extensive investigation into the sports ministry programmes, not least 'Segundo Tempo', which provides sporting facilities for poor children during school holidays and was one of the main schemes used to promote Rio de Janeiro's successful bid to host the 2016 Summer Olympic Games. The investigation was prompted by Silva's unilateral decision last month to reinstate the NGO Instituto Contato, presided over by a PCdoB affiliate, Rui de Oliveira, to manage Segundo Tempo in the southern state of Santa Catarina - after it quit following complaints from community leaders about where the programme should be running in December.
Silva opened an internal investigation into the allegations and denied any involvement in wrongdoing. But the episode served as a perfect excuse for Rousseff to pressure Silva and contain demands from the PCdoB for more posts in her administration after she decided to install the former president of Brazil's central bank, Henrique Meirelles, of the main government-allied Partido do Movimento Democrático Brasileiro (PMDB), to preside over the recently created Autoridade Pública Olímpica (APO), which will coordinate R$30bn (US$18bn) of public and private investments for the Olympics in Rio de Janeiro.
The PCdoB came up with the idea to create the APO and expected it would stay in the hands of the party. But Rousseff needed to find a place for the former star in the administration of her predecessor, Lula da Silva, who left the central bank after clashing with Rousseff's finance minister, Guido Mantega, whom Rousseff inherited from Lula, over the central bank's independence to set interest rates. After losing the post for the PMDB, the PCdoB leadership demanded the main post in a special secretariat that will look into reform of Brazil's judiciary. However, the party's ambitions clashed with those of PMDB Senator José Sarney, a key ally of both Rousseff and Lula (and the senate president).
Rousseff also signalled to the PDT that it should stop pressuring her for more space in her administration after telling off Lupi following the decision of PDT congressmen to vote against the government for a higher rate of increase in the minimum wage last week. Rousseff has allowed rumours to circulate that Lupi would be sacked as head of the labour ministry, leaving the party with no significant position in the government. Lupi's fate remains unknown, though he declared to the press that he expected the government would “show magnanimity" in its victory over the minimum wage increase (see sidebar).
Brazil's senate approved a minimum wage increase to R$545/month, as proposed by the government of President Dilma Rousseff (against trade union demands for a higher increase). The government feared its own allies in the upper house of congress might vote for a higher increase and left nothing to chance: it threatened to withdraw support for the pet projects of any rebel senators that went against the government.
Legal & black markets
More than 60% of all homicides in Brazil are committed with guns. Most of these are unregistered. Data compiled by Viva Rio, an NGO that has been campaigning against criminal violence, show that between 1951 and mid-2003 the Rio de Janeiro police seized 77,527 guns used in crimes; of these, two-thirds were unregistered. This figure is considered only the tip of the iceberg, not least because many of the guns seized by the police are sold by them on the black market.
Estimates of the number of illegal guns in Brazil go as high as 2m. The Brazilian arms industry, the sixth-largest in the world, argues that restrictions on legal gun ownership will do nothing to reduce illegal ownership. Higher penalties, they say, will not deter people who are not constrained by the penalties already established for crimes such as murder, drug trafficking and kidnapping. Their punchline is, of course, that the restrictions will only harm the industry.
Exports out and back
Local antigun activists refute this, noting that about 70% of the Brazilian arms industry's sales are for the military, the police and the export trade. This is quite true: in the case of Forjas Taurus, the world's third-biggest handgun manufacturer, exports account for 65-70% of sales; the local civilian market, 10-15%.
[Taurus accounts for 97% of all sales of guns to the US, where it has a 16-18% share of the revolver market and owns a highly successful subsidiary, Taurus International. The company's managing director, Carlos Alberto Murgal, has threatened to move the whole operation to the US if the `disarmament statute' proves too harmful for business at home.]
On both sides, the arguments share a flaw: they do not take into consideration that many of the exported Brazilian handguns make their way back into Brazil illegally, in the main through Paraguay. Another detail that tends to be obscured is that, existing regulations, lax as they may be, are seen as reason enough for buyers to turn to the black market, where the Brazilian equivalent of a `Saturday night special' goes for about US$60, a .38-calibre revolver for just over US$100, and a 9mm pistol for about US$300-400.
Police barely holding the line
Very many of the criminals who own black-market weapons live in areas that are at present unpoliced or only sporadically policed — which is one of the reasons the black market thrives. Effective policing remains the key to the problem, as was again illustrated in early December in both São Paulo and Rio.
Less than a month after the main criminal gang in São Paulo, the Primeiro Comando da Capital (PCC), staged a series of coordinated attacks against police targets, bringing upon themselves a major police counteroffensive [SSR-03-04], another series of raids was launched against the police. The targets were a highway police post in São Carlos, a police station in Parelheiros, and a police post in Jundaí. This time round, though, the police were alert. In the first incident they killed three of the attackers and arrested another; in the second they injured one of the attackers (the third was uneventful, as the raiders seemed unaware that the post was empty at the time).
Days later in Rio, gang warfare erupted again in the Morro do Dende slum, leaving a toll of eight killed and seven injured. Last month a similar flare-up which killed 12 triggered the early launch of a major police sweep through Rio's
favelas. In the October episodes arrests in São Paulo and Rio ran into the hundreds; a month later the police seem to be barely holding the `front line' in the former and unable to maintain the peace in the latter.
An indication of the way this situation might evolve was provided in late November by the seizure in Rio of a cache of 170 grenades — not run-of-the-mill criminal armament — smuggled in from Argentina. The gunrunners were taking advantage of the free movement allowed by Mercosur to bus the weapons through the border state of Rio Grande do Sul. Markings on the grenades showed them to be Argentine military issue dated to the time of the Falklands war (yet another sign of an unsolved problem across the border). Over the last two years, Viva Rio reports, the Rio authorities seized 3,100 pieces of weaponry brought in from Argentina, of which more than 100 were grenades.
CHILE | 'Confidence-building' drive. The government of President Ricardo Lagos has launched a diplomatic drive aimed at lowering tension and building confidence with its two northern neighbours, Bolivia and Peru. Recent milestones include:
SOUTHERN CONE | Politics & policing. The governments of two South American countries - Uruguay and Argentina - are determined to establish political control over their police forces. Officials outlined the rationale for this at a regional seminar on public security held on 27-28 July in Montevideo. The seminar was organised by the Friedrich Ebert Foundation in Uruguay (Fesur), and entitled 'Citizen Security as a State Policy: Challenges of a National Agenda'. Fesur's aim was to elicit the approaches to public security introduced by the subregion's new 'progressive' governments.
The proceedings departed from the predictable when the third-ranking official at Uruguay's interior ministry, Jorge Jouroff, devoted his contribution to defining the role of the chief of police. This, he said, should be confined to 'coordination and supervision' of the force, but should not extend to its 'command' - which should be vested in the political authorities. The chief of police, he said, 'is not a commander-in-chief.' It must be kept in mind that Jouroff was speaking against the backdrop of Uruguay's experience, in which the dominant role of the commanders-in-chief of the armed services as corporate barons, which still lingers 20 years after the restoration of elected rule, had to an extent 'rubbed off' on the police. This was not unique: in Chile during the Pinochet era, the Carabineros (paramilitary police) were 'elevated' to parity with the three armed forces, and their commander to the same status as the military commanders-in-chief.
The position adopted by Jouroff was mirrored by that of Marcelo Saín, the official appointed by the Argentine government to restructure airport security (wresting it from the air force) in the wake of a scandal involving drug trafficking. Control of the police, he said, should not be left to the police themselves: 'As regards both the strategic operational plane and that of resource administration, it should be vested in the [interior] ministry.' In Argentina, he noted, 'historically the government authorities have delegated the management of everything regarding public security to the police institutions. Until a few years ago, having a good public security setup was interpreted in our country as choosing the right chief of police.'
Mexico's two drug wars - the one being waged by the government against the drug gangs and the one between rival drug gangs - increased markedly in intensity in May. Law enforcement personnel accounted for more than one out of every 10 fatalities. However, this is not so much a sign of a drug-gang backlash against President Felipe Calderón's campaign as an effort by the drug gangs to deprive their rivals of the cover they have been enjoying from within the law enforcement agencies.
According to the tally published regularly by the Mexican newspaper El Universal, in the first three weeks of May there were 240 drug war-related killings. This took the total since the beginning of the year to 1,070. Should this rate be maintained, the tally for this year will be about 25% higher than that of 2006, but should the carnage continue at the faster pace recorded in May, the increase could be closer to 50%.
Relatively few of the deaths (about 20) were identified as gang gunmen killed in clashes with the security forces. Of the deaths on the government's side, five were soldiers killed in an ambush. Most of the 26 fatalities among police officers and prosecutors were assassinations bearing either explicit or implicit 'signatures' of drug-gang executions.
This is a trend which has been gaining strength since April, when some of the most spectacular killings were claimed by groups like La Familia and Gente Nueva [SSR-07-04], breakaway factions of the Gulf cartel waging a war of their own against the cartel's team of gunmen, (Los Zetas,) and those identified as their collaborators or protectors within the law enforcement establishment. In May there were clear indications that Los Zetas were striking back.
Indeed, there was a message from Los Zetas next to the body of Angel Sanchez-Torres, former police chief in Tabasco, killed on 1 May. A threat delivered on 7 May via Internet to Baja California prosecutor Antonio Martinez accused him of protecting Joaquín Guzmán ('el Chapo') boss of the Sinaloa cartel, and his associate Ismael Zambada ('el Mayo'). A similar message about retired General Francisco Fernández Solís, public security secretary of Tabasco, was found next to the remains of two policemen murdered on 10 May.
Fernández had survived an attempt on his life in March, apparently staged by members of a La Hermandad branch of police officers, which appear to be in cahoots with drug traffickers. A message left by gunmen,who on 16 May killed two policemen assigned to protect the children of Enrique Peña Nieto, governor of Baja California, is also thought to have come from Los Zetas.
President Calderón has openly admitted that many members of Mexico's police forces have been corrupted by the drug gangs. On 4 May, while seeking to put a positive spin on his antigang campaign, he said, 'We must put special emphasis on having police officers the citizens can trust, because we cannot ignore that many police forces across the country have regrettably been penetrated by organised crime.' Calderón reported that the combined police-military operations launched in December had resulted in the arrest of 1,400 suspects (up from 1,102 reported by the defence ministry a month earlier) and the seizure of 12 tonnes of marijuana and 300 vehicles.
The government currently has about 30,000 army and police personnel deployed in antigang operation in 10 states. On 22 May it ordered troops into the outlying municipalities of Monterrey, the country's second-largest industrial centre, in an extension of the operations they had been conducting since January elsewhere in the state of Nuevo León. State governor José Natividad González Parás, initially opposed to the deployment of the military, now welcomes it on the grounds that spiralling violence threatens Mexico's competitiveness.
Cleansing the police forces is likely to prove the biggest challenge to Calderón. About half of Mexico's combined police forces are 'contaminated' by the drugs trade - through omission, providing protection or directly working for the drug gangs - according to analyst Ricardo Revelo, who has just launched his book Herencia Maldita ('Accursed Legacy') on Mexico's drugs trade.
In Tijuana, he says, the police have shown '20 years of loyalty' to the Arellano Félix cartel. He notes that the federal chief prosecutor's office (PGR) is currently conducting major investigations into police forces in 15 states, which have already led to 150 arrests and about as many indictments. [New drug cartel alignments: see pages 3-6.]
MEXICO-US | Ban on assault rifles. US congressman Eliot Engel (Democrat, New York), chairman of the House Western Hemisphere Subcommittee, has submitted a letter, endorsed by 53 legislators asking President Barack Obama to 'return to enforcement of the law banning imports of imported assault weapons, which was previously enforced during the administrations of presidents George H W Bush and Bill Clinton'.
The chief rationale was that 'the alarming prevalence of imported assault weapons in the US has put our nation's police officers at risk', but Engel has also linked the request with the violence in Mexico. 'Our failure to enforce restrictions on imported assault weapons is affecting our bilateral relationship with Mexico,' said Engels. 'We must do more to support our friends in Mexico whose drug war is fuelled by firearms flowing south from the United States, many of which should never have entered the US in the first place.'
Assault weapons, he says, 'are being smuggled in bulk from US border states to Mexico where they are used by narco-traffickers to fuel a drug war that is killing Mexican law enforcement and other officials at alarming rates.'
The ban was first established almost 20 years ago. Engels notes that in recent years the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) has quietly abandoned enforcement of the import ban (which was authorised by provisions in the 1968 Gun Control Act and enforced by presidents Bush Sr and Clinton.
Importers are also able to skirt the restrictions by bringing in assault weapons parts and reassembling them with a small number of US-made parts. Assault weapon 'parts kits' for assembly by individuals are also being imported. The ATF has further weakened the prohibition by placing certain extremely problematic assault rifles on the 'curios or relics' list, making certain firearms automatically eligible for importation.
The import restriction is independent of the Assault Weapons Ban of 1994, and was not affected by its 'sunset' in 2004.
MEXICO-US | Pentagon 'concern' raises hackles. A series of statements on the situation in Mexico by Admiral Mike Mullen, chairman of the US Joint Chiefs of Staff, together with media reports playing up a November assessment by the US Joint Forces Command [SSR-09-01], led a number of Mexican officials, starting with President Felipe Calderón, to issue strong denials that Mexico was a failed or failing state or that the government was losing control of parts of its territory.
On 29 January, in response to a question by a Texas newspaper, Mullen said, 'I am extremely concerned about the border and the drug war, although it's not the only measure, but, if you look at the number of murders, kidnappings, and murders that have occurred over the last couple of years, and the rapid increase in that, that has all of our attention. And I know General [Gene] Renuart [of the US Northern Command], who engages as our combatant commander with Mexico, shares that concern.'
In early February, addressing students at Princeton
University, Mullen apparently tried to temper his previous statement, saying,
'We need to pay more attention to our neighbours and their security issues, not
just in Mexico, but in all of Latin America.' On 27 February, however,
announcing an imminent trip to Latin America, he put Mexico back at the top of
the list. 'Mexico,' he said, 'is certainly more of a concern to me. In fact, I
take a trip next week to Latin America and stop in Mexico
specifically.'
In early October thousands of people took to the streets of Buenos Aires demanding, once again, effective government action against crime. As on similar occasions in recent years, the demonstrations were prompted by violent crimes that made headlines — in this case, two murders of young men. The public perception is that crime is on the rise, though the absence of up-to-date official statistics makes it exceedingly difficult to determine how this perception fits actual developments.
Matías Berardi, 16, was kidnapped on 28 September as he left a school-leaving party in Pilar, 50 kilometres from Buenos Aires City. The kidnappers first demanded a ransom of US$1,000, then raised it to US$6,000. The family was willing to pay, but the kidnappers abruptly cut off communications, and on 30 September the youth's body was found dumped on the side of a highway. Diego Rodríguez, 28, was killed when he resisted the attempted theft of his van in Liniers, a district in the west of Buenos Aires city.
The most recent nationwide statistics for homicide date back to 2007. The province of Buenos Aires, where the Berardi murder took place, has data up to the end of 2009. In that year there were 1,048 homicides (equivalent to a rate of 6.8 per 100,000). This was down 8% on the previous year — but 8% higher than in 2007. The homicide rate for the whole of Argentina in 2007 (latest available) was 5.3 per 100,000 inhabitants. To put this into perspective, Brazil's rate was four times higher, Chile's was about 50% lower. Within Argentina the highest provincial rate in 2007 was that of Santa Fe (9 per 100,000).
A broad, more up-to-date indication of trends comes from the Universidad Torcuato Di Tella's crime research 'laboratory', Licip, which produces a victimisation index based on monthly surveys of crime victims. This index fell from 33.6 in the second semester on 2009 to 31.5 in the first semester of 2010. A sharp rise in July took it up to 39.6 — but the average for January-August, at 33.3, was roughly at par with that of late 2009. Licip aggregates homicides with other offences (robbery with violence, injury, extortion, sexual assault, fraud and kidnapping) in a category labelled 'crimes against persons', which records a monthly average of 20 cases in the 12-month period ending in August 2010, compared with 21 in the preceding six months.
Official kidnapping statistics are as outdated as those for other crimes, apart from suffering from the regionwide phenomenon of under-reporting by victims and from the methodological quirk of aggregating kidnapping for ransom within the broader category of 'crimes against liberty'. A rough up-to date indication of trends has been published by the Centro de Estudios Nueva Mayoría (CENM), a private think tank. Based on media reports it has counted, in the 12 months to August 2010, 16 cases each of kidnappings for ransom and 'express' kidnappings. Kidnappings for ransom averaged one a month in the last quarter of 2009. None were reported in the first quarter of 2010, after which there were four cases in July and five in August.
In September 2010 the government of Buenos Aires city banned motorcyclists from carrying pillion passengers during working hours in the city centre, in an attempt to curb the wave of often violent motochorro ('bike thief') robberies, which the media reports as averaging 50 a day in January-April 2010. Most of the victims were unwary pedestrians, but police received in January-September 3,563 reports of cases of people robbed after withdrawing cash from banks, obviously the result of information from 'spotters' inside.
Argentina's oil and gas production fell in 2009 compared with the previous year, marking the third consecutive decline since 2006.
In 2009 the country produced 36.15m cubic metres of oil and 48.41m cubic metres of gas, according to the latest official data for the energy ministry. This puts oil production down about 4.3% from a year ago and gas output down 3.7% on the year.
The big problem for the energy industry is that companies have stopped exploring, fearing that if they do strike gas they will be encouraged to develop the deposits only to have price controls slapped on them to strip them of any profit. This is leading companies to overexploit mature fields whose productivity is declining. Unless this trend is reversed output will start to fall sharply.
The whole energy industry faces constantly shifting rules, price controls and export taxes and this state intervention has discouraged investment in exploration and production. The irony is that geologically Argentina is one of the most promising areas in Latin America. But currently the country has less than 10 years' worth of reserves of natural gas at current rates of production.
Around half the country's domestic energy is produced by natural gas. Yet natural gas reserves are not being replaced for lack of new exploration and development. As Bolivia increases both the volume and the price of its supplies, some local gas men are beginning to argue that the country would be better off investing in LNG terminals, if only to show Bolivia that it cannot go on setting prices indefinitely.
After the economic crisis caused by the ending of convertibility in 2001, the government kept gas prices artificially low, which drove up demand. In 2003, price caps seemed like a prudent approach, because Argentina was a natural gas exporter and gas reserves were at an all-time high of 27 trillion cubic feet (tcf). By 2007, gas reserves were down to 15.6 tcf, which according to BP gives a reserves to annual production ratio of 9.8 years.
The trend of declining reserves and rising domestic gas consumption after 2003 shows that reserves have declined 2.6 tcf per year, while internal consumption has been increasing by about 40bn cf/year.
Gas explorers point out that from 2005 to mid 2007, the number of drilling rigs did not surpass 85. Only 5% of the wells were exploratory: the other 95% were drilled into already known deposits.
Argentina's gas problems have prompted Chile, which used to buy 2.38bn cubic metres a year of natural gas from its neighbours, to look for a more reliable supplier. As Chile's relations with Bolivia are historically fraught, the Chilean government decided to commission LNG regasification plants.
Big energy companies are unlikely to return to Argentina any time soon unless Argentina settles a string of outstanding judgments against it at the World Bank's International Center for the Settlement of Investment Disputes (Icsid). CMS Gas Transmission has been awarded US$133m by Icsid after the Argentine government refused to raise gas prices during the economic crisis. Icsid also awarded the San Diego-based Sempra Energy US$172m because of the utility price freeze imposed by the government. Low gas prices reduced the value of two Argentine gas distribution companies acquired by Sempra Energy.
The Banco de Mexico reported that remittances from Mexicans working in the US were up by 25% in the first seven months of 2004, compared with the same period of 2003, at US$9.37bn. The question is whether the actual volume of remittances has increased: our view is that the statistical increase largely reflects a change in the form of the remittances.
Remittances have only recently become seen as an identifiable item in a country's and Mexico's balance of payments. Satisfyingly for officials, remittances have increased dramatically since they were given their own line in the balance of payments statistics. Whether this is a real increase, or just the product of better monitoring, is far from clear. This year, for the second consecutive year, remittance revenues are likely to outstrip foreign direct investment.
A 25% jump in the value of remittances would seem to indicate either a surge in the number Mexicans working in the US or an increase in their disposable income. A surge in the number of migrants working in the US would, in an US election year, have drawn at least some comment and analysis. There has been little or none such comment. Equally, there is little external statistical support for the suggestion that the labour market in the US has tightened to such an extent that wages are rising. With the labour market still delicate in the US, according to the most recent employment statistics, it hardly seems likely that Mexican workers are doing much better than everybody else.
The most likely reason for the surge in remittances, which should take them over US$15bn this year, is that the central bank is capturing more of the transactions in its monitoring. The raises the questions of how much remitting is actually going on and whether it has changed much in the past five years. As remittances increased by 30% last year, it could be that they are still significantly understated.
Another possible explanation for the huge increase in remittances is that it has been caused by the demographic changes in the Chicano (Mexican-American) population in the US. The population is ageing, so there are proportionally more people of working age in the US. It could be that there are more job-shares and family businesses in the Chicano part of the population so the base of potential remitters is broadening. Instead of a couple and say a pair of their in-laws sending back money, the next generation down is now also working, often for relations, and sending money back. Equally, it could be that the central bank is still including other transactions in its remittance data, though this is less convincing. It hardly seems likely, for instance, that drug smugglers would remit tiny amounts of money (US$325.9, on average) electronically each month. The average remittance this year is up by only 3% from last year's average of US$316.7.
The central bank reported that there were 28.76m remitting transactions in the first seven months of the year. The bulk of these were electronic transfers (worth US$8.16bn); US$1.1bn were postal orders and only US$104m were made in cash. What is interesting is that there have been significantly more electronic transactions this year than there were last year. The bank reckons that the number of electronic transactions increased by 22% in the first seven months of the year, compared with the same period of 2003.
The bulk of the remittances go to four states: Michoacán, Guanajuato, Zacatecas and Jalisco. The government reckons that almost 6% of Mexican families benefit from remittances: around 6.3m people. The Consejo Nacional de Población reckons that there are 14m people of Mexican origin working in the US; of these 9.5m are legal migrants and 4.5m are undocumented.
Currently Wal-Mart buys more fresh fruit and vegetables from Argentina, Chile and Russia than it does from Mexico. McKnight also said that Mexican food companies may become Wal-Mart's suppliers of Latin American foods. Wal-Mart wants to increase its direct purchases: in 2003 it bought US$150m worth of foods directly from Mexican producers. It bought another US$1.35bn worth through intermediaries.
The annual inflation rate jumped to over 4% in September, according to figures released by the Banco de México on 9 October. Then, on 24 October, the central bank released figures for inflation in the first half of October that showed the annual inflation holding at over 4.4%: the actual rate of price rises for the first two weeks of October was 0.28%. An annual rate of 4.4% would be a bit outside the central bank's target of an annual rate within one percentage point of 3%. The central bank argued, and we concur, that volatile fresh food prices were the main reason for the surge in inflation, so rates would fall once supplies of fresh food reverted to normal.
The main reason for the sharp rise in inflation in the past six weeks has been the damage hurricanes have done to the tomato crops in Sinaloa. This has led the shortages of tomatoes, which have a high weighting in the inflation index, and this phenomenon pushed up in the overall rate. The shortages have prompted a 76% jump in tomato prices in the past six weeks. This accounted for 40% of the rise in overall inflation in September.
So the fact that the September monthly rate, 1.01%, is the highest since December 2000, should not worry the financial markets too much. Besides problems with tomato supplies, the inflation rate has been pushed up by higher sugar and tortilla prices.
Sugar prices should fall as the new crop is harvested: the government has also contributed by easing restrictions on imports. On 11 October the economy ministry mid-wifed a deal between sugar producers and users to lower sugar prices. In exchange for the government agreeing to limit imports of sugar, domestic producers agreed to offer easier terms to sugar users. The government had authorised imports of 267,606t of sugar to lower prices in the domestic market. Earlier, on 5 October, the government authorised the importation of 500,000t of fructose from the US for the 12 months to 30 September 2007. It also said that the country would import a further 250,000t in the final three months of 2007.
Tomato prices should fall further, especially if the US demand for Mexican tomatoes in the US winter is weak. The more substantial worries about Mexican inflation derive from the jump in prices in the services sector. This trend seems to be changing: the only substantial jump in the services sector price in September was in the education sub-sector. This sector, however, always rises sharply in September as most children return to school. Overall, however, the rate at which prices of services were rising eased in the past three months.
The central bank claimed that the jump in September inflation was nothing to worry about. It points out that its index of underlying inflation, which strips out volatile fresh food prices, rose by only 0.3%. This index is still running at under 3.5% for the 12 months to September. Indeed, annualising the underlying rate for the first half of October gives an underlying rate for the past 12 months of 3.45%. This is bang in line with the central bank's target. What the central bank figures do show is that manufacturers are under pressure. The central bank's index of producer prices rose by 6% in the year to September.
Guillermo Ortiz, the governor of the Banco de México said, on 10 October, that inflation would continue to be comparatively high in October and November. He said that the central bank's forecast for inflation of between 3.5% and 4% were under review.
Demand in the economy is easing. In August retail sales were up by 2.9%, significantly below what economists had expected. The consensus was for a rise of 3.5%. This weakish domestic market, coupled with lower US demand for Mexican exports, is likely to mean that the growth rate in the final quarter of the year will be the lowest of the year.
Growth: In August, the economic activity index (IGAE) rose by 4.3% year-on-year. The IGAE is a proxy for GDP growth. The August figure is pretty good, as it includes a considerable fall in agricultural output, (of 4.9%, year-on-year). In July, agricultural output was up by 5%, year-on-year. The August figure was lower than the consensus forecast of 4.5%, and well down on the average rate of growth in the six months of 2006, which was 6%. The more economically important sectors of industry and services are both doing well. Industry grew by 5.8%, thanks to a strong (7.3%) growth in construction. Manufacturing output was up by a healthy 5.6%.
Remittances: In the first eight months of the year, remittances rose by 20% year -on-year to US$15.51bn. In August, remittances came to US$2.1bn. In 2005, they came to US$20.0bn.
Poverty: The latest poverty figures, from the Consejo Nacional de Evaluacion de la Politica Social (Coneval), which is based on what people tell the Inegi researchers who compile the national survey of household income and expenditure, should worry the incoming government. The Coneval found that the number of households in poverty increased in 2005 compared with 2004. Coneval drew the urban poverty line at households with incomes of less than M$1,586 (US$145.50) a month. The rural poverty line is income below M$1,060 (US$97.2) a month.
The 2005 rise in poverty broke eight years of continuous falls. The number of households who said that they were mired in poverty was 10.178m in 2005, up from 10.15m in 2004. As the data is based on interviews, rather than an objective analysis of returns, the change is not statistically significant. More worrying for policymakers is the fact that extreme poverty affected 3.6m families in 2005, up a thumping 2.2% on 2004. The extreme-poverty line is drawn at M$790 a month in urban areas and M$584 a month in rural areas. People with incomes at these sorts of levels cannot feed themselves and their families adequately. Around 19m Mexicans fall into this category.
The rise in extreme poverty is odd because the economy was recovering in 2004 and the number of people in proper (ie social-security paying) jobs rose for the first time since President Fox took office in 2000. What makes the 2005 data odder is that even the sluggish growth years of 2001 and 2002, the number of households which said that they were poverty stricken fell. What seems to be happening is that the pick-up in the economy did not have much effect on the rural population. Indeed the number of households in rural areas saying that they were poverty-stricken increased by 5.2% while the number of urban households in poverty fell by 4.7%.
Most economists agree that the two main anti-poverty programmes over the past eight years, Progresa, under President Ernesto Zedillo and Oportunidades, under President Fox, have been effective. Since 1992, poverty levels have fallen from 54% of households to 47%. Where these programmes have been least effective is in reducing the number of people in extreme poverty. In percentage terms the number of people in extreme poverty has fallen by only 4.7% in the past eight years. In 2005 the proportion of the population in extreme poverty increased by 0.8 of a percentage point.
At least 21 people were killed in a fire-fight between the army and criminal gang members in Chihuahua, northern Mexico on 10 February. This was the biggest military incident so far this year. Although the military operation was not entirely successful, it does suggest that its intelligence operations are improving.
The operation was not successful because six hostages taken by the gangsters were all killed. The evidence that military intelligence is improving lies in the fact that the army appears to have been expecting the attack.
The mixed results of the operation, however, are likely to put further questionmarks against the government's continued use of the army against the drug gangs. Over the past couple of years Chihuahua has become by far the most violent state in Mexico. The army has been deployed in the state for the past two years, but to little effect. The president of the senate, Gustavo Madero, who comes from both the Partido Acción Nacional and Chihuahua, called for “extreme solutions to an extreme problem".
Businessmen and ranchers in Chihuahua have already threatened to set up their own deathsquads in response to the gang violence. Madero recoiled from such ideas when asked to explain what he meant by “extreme measures." He said that the authorities (federal, state and municipal) should “close ranks and ignore party politics and party advantage because that is what ordinary people are demanding that we should do." Madero specifically ruled out the idea that the government should declare martial law (Estado de Sitio) in Chihuahua. He implied that the authorities still had sufficient resources and policies which could be employed to remedy the situation. In particular he wants congress to approve the government's proposal to increase the budgets for those agencies combating drug-trafficking, narco-terrorism and organised crime.
The 10 February killings occurred at Villa Ahumada. Gangsters apparently moved into the municipality at about 3am to kidnap six people. The army was quickly deployed and four helicopters were used, despite cold, snowy weather. The army first confronted the gangsters as they were leaving the municipality in five pickups with their hostages. The first attack by the army killed three gang members. The army and the helicopters then attacked again, on three separate occasions, killing another 11 gangsters, with the loss of an army sergeant. The army did not admit to taking any prisoners.
The US State Department announced the resignation of the US ambassador to Mexico, Carlos Pascual, on 19 March. Ostensibly, Pascual's resignation is a victory for President Felipe Calderón, who had made it clear, particularly during his recent (2-3 March) trip to meet President Barack Obama in Washington, that he had lost confidence in Pascual. But Calderón's victory could easily turn into a strategic defeat and leave Mexico with no conduit to the higher echelons of Washington policymakers during the next, crucial, few months. This is because, at the express request of the US Secretary of State, Hillary Clinton, Pascual is remaining in Mexico to ensure an “orderly transition".
Relations between Pascual and Calderón, though not between Pascual and Patricia Espinosa, Mexico's foreign minister, had deteriorated so much that organisations such as American Chamber of Commerce of Mexico (Amcham) invited Calderón and Pascual to different bits of their annual meeting. Insiders say that this was to avoid awkwardness, though officially, “diary clashes" were cited. Calderón attended the opening and Pascual the closure of the annual get-together. Traditionally, both the president and the US ambassador would attend set-pieces such as the Amcham annual do together.
This sort of standoff is likely to continue for as a long as Pascual remains in the country. As President Obama took five months to settle on Pascual (after the previous ambassador, a political appointee, resigned after Obama came to power), Pascual is likely to be stalking the US embassy in Mexico City until at least the autumn, given the problems Obama may also have in getting his nominee confirmed by the Senate.
The next few months are likely to shape the next few years of US-Mexican relations. There are at least two reasons for this. One is that by October the runners for the Mexican presidency in the July 2012 elections should become clear.
Another is that by October Mexico will have to be clear about what sort of privileges it is prepared to give the US in Mexico. It is worth noting that President Calderón only recently commented on the scandal caused by a strange US plan, known as 'Operation Fast & Furious', to allow Mexican gangs to equip themselves with assault rifles from the US. He made his elliptical comments in a long interview with El País, a Spanish newspaper, published on 27 March.
Calderón & El
País
President Felipe Calderón's sympathetic interview with
Javier Moreno, the editor of El País, appeared designed to achieve two things.
The first was to portray Calderón as a statesman. The second was to fix the US,
and particularly President Barack Obama, with the blame for the upswing in the
violence in Mexico. Calderón virtually called Obama a moral coward for failing
even to attempt to reintroduce the controls on the sale of assault rifles in the
US which had been introduced by President Bill Clinton but effectively abolished
by President George Bush in 2004. As Calderón took umbrage at Pascual for
questioning the bravery of Mexican security forces, the insult was calculated.
Moreno wanted Calderon to say that he was disappointed with the US but Calderón
adroitly dodged that admission. He implied that his lodestar was a realist
insight from the founder of the ruling Partido Acción Nacional (PAN), Manuel
Gómez Morín, who said: “Que no haya ilusos para que no haya desilusionados [You
can't have dreams without being disappointed]."
Calderón has not commented directly on the US use of unmanned drones over northern Mexico (though US and Mexican officials both claim that the Mexico asked the US to deploy the drones). Calderón also has to decide how far to push two US requests: one is for the extradition of a Mexican accused of killing a US Immigration & Customs Enforcement (ICE) officer to face prosecution in the US which could result in a death penalty sentence; the other is for US officials to be allowed to carry arms when on duty in Mexico.
There is a growing view in Latin America that the US relationship with Mexico (and some would say the Caribbean Basin) is different from its relationship with other countries in Latin America. Indeed Jorge Castañeda, President Vicente Fox's first foreign minister (2000-2003), recently suggested that Mexico's relationship with the US had more in common with the Caribbean Basin's relations with the US than with South America's US dealings. Castañeda argued that President Obama's recent trip to Latin America (with stops in Brazil, Chile and El Salvador) may be the last by a US president to Latin America. From now on, Castañeda argued, US presidents will deal separately with at least two Latin Americas: Mexico and the Caribbean Basin, and South America.
In Castañeda's view, each of these sub-regions has a completely different range of issues to discuss with the US. South America has joined the world economy thanks to the commodity boom and thus the US no longer dominates its economic relationships. For Mexico, Central America and the Caribbean, however, the US looms over them and issues like trade, immigration and security all have a US dimension to them and are also politically important in the US. It will be fascinating to see if Castañeda's insight is acted on by the US. For Mexico, it has already become clear that the Department of Homeland Security (DHS) has as much influence on US policy towards Mexico as the State Department.
The heating political pace in Mexico in the run-up to the 2012 elections had a bearing on Pascual's difficult relations with Calderón. One of Calderón's alleged (but unstated) problems with Pascual was that he is dating Gabriela Rojas, the daughter of Francisco Rojas, who leads Mexico's biggest party, the Partido Revolucionario Instituicional (PRI), in the lower chamber of congress. Rojas is a strong ally of a former president, Carlos Salinas de Gortari (1988-1994). Salinas is widely assumed to be backing Enriqu Peña Nieto, the governor of the Estado de México, for the 2012 presidency. Calderón showed himself to be particularly annoyed last May, when Peña Nieto and Pascual winked at each other when all three were at an event in the Estado hosted by the Ford Motor Company.
Calderón's problems with Pascual officially began when the ambassador's comments about Mexico and the inefficiency and corruption of its police and army, as revealed in US State Department cables, were published by WikiLeaks in December 2010. According to WikiLeaks, Pascual also made some undiplomatic comments about Calderón.
Despite Calderón's hostile comments about Pascual during the March trip to Washington, the US backed Pascual strongly in briefings. Indeed, Clinton's statement accepting Pascual's resignation was also strongly supportive of Pascual's term as ambassador to Mexico. She called him the “architect and advocate for the US-Mexican relationship, effectively advancing the policies of the US on behalf of the President and this administration." Interestingly, Clinton enumerated Pascual's successes as energy and trade, especially promoting US exports, and only in passing commented on the security problems which are the biggest problem Mexico faces.
Pascual himself, however, recognised, according to a State Department statement, that he had become a distraction in US-Mexico relations and therefore made the personal decision to resign.
The vetting of a successor to Pascual by the US Senate is likely to be excruciating for Calderón and his government. A growing number of US policymakers believe that Mexico is well on the way to becoming a failed state and poses a major security threat to the US. These points are certain to be aired in the vetting process.
Pascual's resignation comes at a particularly awkward time in bilateral relations, with politicians on both sides of the border trying to gain domestic popularity by taking swipes at their neighbour.
On 17 March senators from all parties, including the ruling PAN, criticised the Mexican government's policy towards the US. The Mexican senate's unhappiness with what the US has been doing in and over Mexico bodes ill for US attempts to allow its officials to bear weapons in Mexico and for the US attempts to extradite a Mexican suspect for the murder of the US ICE agent to face a death-penalty trial in the US.
On 16 March Mexico did extradite a national, Emilio Samyn Gonzáles Arenazas, to California, where he faces prosecution for the murder of a US Border Patrol agent in 2009. California, however, has a de facto suspension of executions.
On 17 March Mexican senators from all parties were questioning the foreign minister, Patricia Espinosa, over recent US operations in Mexico. The two most notable were the aforementioned 'Operation Fast & Furious', in which the US deliberately allowed Mexican gangs to equip themselves with supposedly tracked assault rifles, and the use of US drones in Mexican airspace.
A former foreign minister, Rosario Green, from the PRI, said that never had a Mexican government handed over so much for so little and with such poor results. She said that Mexico's foreign policy was in a critical situation, with the government concealing information and making dangerous miscalculations in a confrontation with the US over Pascual. Green's questioning of Espinosa was particularly pointed, because Green had been one of the supporters of Espinosa, a professional diplomat, during her time as foreign minister. When Green was foreign minister, Espinosa was responsible for Mexico's relations with Latin America.
Green said that it was “unacceptable" for the Mexican government to rely on “investigations on the other side of the border" over both 'Fast & Furious' and the use of drones.
What the Mexican senate can do the US House Representatives can do even better. On 18 March, a Republican congressman from Texas, Michael McCaul, who chairs a Homeland Security subcommittee on Oversight, Investigations & Management, announced a 31 March hearing on “The US Homeland Security Role in the Mexican War Against Drug Cartels" to consider “the failed" 'Fast & Furious' operation.
The Mexican government itself stoked the fire on 23 March when Alejandro Poiré, a senior security official, let it be known that Mexico would seek to extradite US officials who had approved 'Fast & Furious'. Mexico's decision to go for extradition raises the stakes in the growing row between the US and Mexico over 'Fast & Furious'. The US is highly unlikely to allow its officials to face Mexico's courts, yet influential US Republican congressmen, such as McCaul, want the Mexican suspect accused of killing the ICE agent, Jaime Zapata, on duty in Mexico, extradited to the US to face a possible execution.
The plot thickens over 'Fast & Furious'
Mexico's
Procuraduría General de la República (PGR) said that it would investigate
further allegations, emanating from the US, that senior US Department of Justice
(DoJ) officials knew about Fast & Furious but deliberately concealed the
information from their Mexican counterparts.
The PGR, which liaises with the DoJ, said that it was investigating whether crimes had been committed on Mexican territory. The PGR pointed out that US government officials had again admitted that Mexico knew nothing about Fast & Furious. The latest revelations came from Darren Gil, a former ATF representative in Mexico. He said that his superiors ordered him to keep the operation secret from his Mexican counterparts but also confirmed that not only the director of the ATF, Ken Melson, but also US Department of Justice officials knew about the operation. He said that an interception of weapons in Phoenix, Arizona, in 2010 has triggered his suspicions that something was going on but he had been denied background information.
The statement that Mexico would seek extraditions came from the outgoing and incoming chairmen of the joint security committee in Mexico's congress, Gustavo González, a PAN deputy, and René Arce, a PRD senator, respectively. They were reporting on a joint meeting with Poiré. The committee chairmen both said that the federal Procuraduría General de la República (PGR) was working on securing the extradition of the US officials.
The chairmen added that Poiré had confirmed to them that no Mexican official had known about 'Fast & Furious'. In the US, the ATF was not working alone. Documents show that the ATF had conference calls with the Department of Homeland Security, US Marshals and the Drug Enforcement Administration (DEA). An ICE agent, officially answerable to the DHS, was on the ATF's 'Fast & Furious' team. This team was also advised by an assistant US attorney from the Justice Department.
There are mounting concerns over killings by police in Trinidad & Tobago. During the budget debate in parliament in October, opposition leader Basdeo Panday claimed that as of 22 August this year there had been '14 murders allegedly committed by policemen amounting to a crude display of police brutality'.
During his speech to parliament, Panday asked: 'How can the population be expected to have confidence in the police, one of the most important institutions in a democracy, when they continue to operate above the law by terrorizing and murdering citizens who depend on them for assistance and protection?' The interesting aspect of Panday's allegations was that the government's response was hardly reassuring. Speaking in the same budget debate on 25 October, National Security Minister Martin Joseph did deny the existence of any death squads, saying: 'There is no death squad existing in the Police Service and no such arrangement will ever be tolerated in this country.'
However, he admitted that he had recently been approached by 'some prominent citizens' who had suggested to him that it had become necessary 'to take some people out' in order to reduce the crime wave. (As of the end of October, there had been 222 murders in Trinidad compared with 175 in 2003.)
Naturally Joseph said that he had dismissed the suggestions out of hand, but the very fact that 'prominent citizens' felt able to approach the national security minister with such a suggestion is remarkable. Joseph said: 'I told them that we cannot even think about that. I told them that there is a country [presumably Guyana] right now which is being scrutinized for allegedly being engaged in such action.'
Only the day before, on 24 October, Prime Minister Patrick Manning revealed his own disquiet over the issue. He told the Women's League of the ruling People's National Movement (PNM) that he was concerned over the recent killing by police officers of five youths in two separate incidents. He said it was 'unacceptable if citizens of Trinidad & Tobago are gunned down in cold blood'. However, he did say that it was not his intention to 'castigate the police' and he said that he understood the pressure they were under, saying: 'Pressures are on them to perform and, from time to time, some police officers become over-enthusiastic in the conduct of their duties.'
In its 2004 annual report, Amnesty International noted that during 2003 'there were continuing reports of torture and ill-treatment by the police and army, sometimes resulting in death'. On 27 October Police Commissioner Trevor Paul announced that officials were investigating 21 killings by police officers since January.
In addition to the crime question - and the police's tactics in dealing with it - the government is under pressure on corruption. There is some irony in this given that the Manning administration came to power on an anti-corruption ticket, capitalizing on the involvement of the 1995-2000 Panday government in a serious public-sector scandal.
Now with the tables turned, on 20 October the prime minister conceded that the Integrity Commission would be asked to look into allegations that Housing Minister Dr Keith Rowley had used labour and materials from a state building project for a private sector project to which he was linked. He has also ordered an investigation into all government contracts awarded since he took office in 2002.
President Fidel Castro was at his belligerent best during a two-hour speech on 19 April, the anniversary of the failed 1961 Bay of Pigs Invasion (known as Playa Girón in Cuba after the beach where the landing took place).
Speaking at Havana's Karl Marx Theatre before a crowd of more than 3,000 invited guests, many of them Playa Girón veterans, Castro said: "It has been an unending battle for 45 years_ there has not been a single day of peace, nor will there be, nor do we ask for it. We're not provoking war, nor will we provoke war, but we will never beg for peace from the US which has deprived us of that goal for so long."
Castro did not have anything startlingly different to say from countless other speeches over the years but his assertion that "the hemisphere is falling from their (US) hands, they cannot continue subjugating peoples ... and the feeling of independence grows stronger every day" did not ring quite so hollow for once.
In a piece entitled "In Search of Hugo Chávez " that he contributed to the May/June 2006 edition of Foreign Affairs, Michael Shifter, vice president for policy at the prestigious US think-tank Inter-American Dialogue, writes: "What has particularly alarmed US officials is Chávez 's alliance with Castro, Washington's nemesis for nearly half a century. With his resources, Chávez has succeeded in giving new life to the vision many considered long buried: to export 'revolution' (in this case, Bolivarian Revolution) throughout Latin America." Interestingly, Shifter cites a July 2005 speech "The Return of an Aggressive Cuban Foreign Policy" given to the Hudson Institute by the deputy assistant secretary of defence for Western Hemisphere Affairs, Roger Pardo-Maurer, in which he warns that Castro is taking advantage of Chávez 's resources to carry out a strategy believed to be declining.
Talk of the decline of US influence in Latin America has been going on since the end of the Cold War of course. There is an increasing focus on China's growing interest in the region to keep it supplied with the primary commodities it needs to sustain its rapid economic growth. And now the Chávez /Castro partnership is seen as a threat to US interests in the region. Chávez is looking to extend his generous provision of oil to Cuba to other countries in the Caribbean under his PetroCaribe initiative and is even seeking to undermine US influence in its very own backyard by supplying cheap oil to left-wing mayors in Nicaragua and El Salvador.
Chávez 's oil diplomacy provides an attractive economic deal for countries across Latin America and his fierce criticism of US-backed neoliberal policies resonates throughout the region but, as Shifter points out elsewhere, "(leaders) indulge him_ without really endorsing his agenda". While Latin American countries remain dependent on the US, Pardo-Maurer's fears will remain some way removed from reality, but until Washington comes up with a credible alternative to the Chávez /Castro deal and addresses some of the big issues for Latin American countries, such as migration and social development, the "revolution" will continue to have its adherents.
Worth noting: While Castro dismissed the month-long US military exercises in the Caribbean in April - "those little boats going around out there don't scare anybody" - Chávez called the US exercises "a threat against us - not just against Venezuela but also against Cuba". Venezuelan Admiral Orlando Maniglia announced that Venezuela would soon hold military exercises along its coasts in concert with the armed forces of (unspecified) neighbouring countries.