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  • PERU: Army captures top Sendero leader

    24 April 2007 Hits: 369

    In a second clash in the central department of Juní­n, the Peruvian army last week captured one of the highest-ranking leaders of the Sendero Luminoso (SL), Jaime Zúñiga Córdova ('Dalton') and two other guerrillas, after killing four of their comrades and putting to flight the remainder of their `column', estimated to have been 25 strong.

    Dalton was reputed to have been the lieutenant of `Alipio', overall commander of the SL unit operating in the Ene-Apurí­mac valley, and one of the planners of the kidnapping, earlier this year, of 21 pipeline workers. An interesting feature of the army's report on Dalton's capture was the list of materiel seized from the guerrillas: one shotgun, one pistol, 14 rounds of ammunition two grenades and a Motorola radio - hardly what would be expected in a unit presumed to have been rearmed with the proceeds of their coca-trafficking connections.

    It is worth noting that in midyear locals who had met the force under Alipio's command estimated its strength at 60, and that shortly afterwards a defector from that unit surrendered to the authorities, telling a tale of internal dissent (WR-03-33).

    In a related development, defence minister Aurelio Loret de Mola has asked President Alejandro Toledo to relieve him of his post.

  • Tracking trends

    24 April 2007 Hits: 336

    COLOMBIA | Uribe defies IMF on debt buyback. President Alvaro Uribe has dismissed IMF objections to his declared intention of dipping into the country's reserves to buy back some of the public external debt. `The Colombians,' he said, `are very poor; they need social investment, so our reform must not be confined to taxes but also include relief to encourage employment and social investment - and the Banco de la República [central bank] must contribute to this through a good use of the reserves.'

    Servicing the public debt absorbs almost 40% of Colombia's budget. In the first half of the year the country devoted US$2.97bn to servicing the public external debt, of which US$23bn is outstanding. Colombia's international reserves stood at US$10.6bn at the end of October. Worth noting: Colombia's central bank has a high degree of autonomy, so it need not automatically go along with Uribe's wishes.

    ECUADOR | Time of reckoning on gas price. President Lucio Gutiérrez announced last week that `the time has come' to set a realistic price on the currently subsidised canister of cooking gas - something he had been putting off since taking office, mindful that previous governments have been defeated, even ousted, for attempting it. The economy ministry says it has completed studies that counsel an increase from US$1.6 to US$5 per 15-kilo canister, retaining a subsidy for the 1.2m poorest members of society.

    Eliminating the cooking-gas subsidy was one of the commitments made by the Gutiérrez administration to the IMF, as a condition attached to the US$205m standby agreement signed last March. Recently the World Bank recommended raising the price to US$7.5 per canister. At least one indigenous organisation, the Federación Nacional de Campesinos e Indí­genas, has served warning that an `uprising' [a major protest mobilisation] may be staged if the subsidy is eliminated.

  • MEXICO: Oaxaca gets 'first indigenous party'

    24 April 2007 Hits: 355

    Tribunal orders registration of new leftist party based on an opposition Triqui organisation in a state long ruled by the PRI.

    The first self-proclaimed `indigenous party' of Mexico has been granted official recognition in the southern state of Oaxaca. The state electoral tribunal last week overruled the state electoral institute's decision not to register the new Unidad Popular (UP) party, formed by the Movimiento Unificador de Lucha Triqui (MULT) and Nueva Izquierda de Oaxaca (NIOAX).

    The MULT, core of the new organisation, has long rivalled the Unidad de Bienestar Social de la Región Triqui (Ubisort) as representative of the Triqui people. Ubisort is aligned with the Partido Revolucionario Institucional (PRI), which has never been dislodged from the governorship of Oaxaca. The new UP intends to contest the governorship in next year's state elections.

    The leader of the MULT for the past 23 years, Heriberto Pazos, is not himself a Triqui or even a native of Oaxaca. The new party, UP, claims a membership of 35,245 drawn not only from the Triqui but also from 15 other ethnic groups in Oaxaca, plus members of mestizo communities in the central valleys of the state.

    Next year's elections are also to renew the government of Oaxaca's 570 municipalities, of which 418 have an indigenous majority and are ruled according to indigenous custom, while parties compete for power in the other 152. The Triqui are concentrated in the municipalities of Santiago Juxtlahuaca, San Martí­n Ytuyoso and Putla de Guerrero, in Oaxaca's Mixteca region, one of the poorest and hardest hit by political violence.

  • MEXICO-US: Ambassador triggers `backyard' outrage

    24 April 2007 Hits: 365

    Aguilar's criticism of US attitude riles Colin Powell and, turned on its head, becomes source of `indignation' for politicians of all ilk at home.

    President Carlos Salinas de Gortari (1988-94) sought, with Nafta, to enter a marriage of convenience with the US, but ended up being no more than a `weekend fiance'. The US is not interested in a relationship between equals, but in one of `convenience and subordination'. It does not see Mexico as a partner in the same way as its European partners; Mexico is still the `backyard' - and will continue to be just that as long as its attitude towards the US remained submissive. This was fighting talk by Adolfo Aguilar Zinser, Mexico's ambassador to the UN, delivered to an audience at the Universidad Iberoamericana on the eve of the 20th meeting, in Washington, of the USMexico Binational Commission. No sooner had the choice quotes been relayed by the Mexican state-owned news agency, Notimex, than a barrage of indignation, genuine and political, followed.

    US Secretary of State Colin Powell, perhaps the only one who paid attention to what Aguilar's actual words, said it was `outrageous' to suggest that the US viewed Mexico as its backyard. Most of the `indignant' Mexicans (headed by PRI and PRD congressional leaders, and President Vicente Fox) reacted as if Aguilar had stated as a fact that Mexico was the backyard of the US. His boss, foreign minister Ernesto Derbez, said he'd wait until he had spoken to Aguilar.

  • MEXICO-US: What bodies can tell about migration

    24 April 2007 Hits: 274

    Dead men do tell tales, at least to US journalist Naomi Adelson, who has turned to records of repatriation of bodies to Mexico to learn more about patterns of emigration to the US. Working from data compiled by the Mexican consulate in San Francisco (which attends to northern California), she writes in El Tecolote that over the past five years an average of 18 bodies a month were shipped back to Mexico.

    Of these, 56% were males, `clearly reflecting that we are talking about a migrant population, many of whom have not been able to bring their families to this side.' Also, 45% had died aged between 26 and 50, and 12% aged less than 26, `which is to be expected from a young migrant population.'

    Just over half the bodies were shipped to two states that have long been exporters of labour to northern California: Jalisco (34%) and Michoacán (22%), and to a large number of locations within them, indicating the migration affects `the whole geography of these Mexican states.' There are also, though, signs of reorientation of flows: 19.6% come from three states that habitually export labour, but not to northern California: México, Guanajuato and Oaxaca.

    A grim addendum: 7% of the bodies shipped back were of victims of homicides.

  • GUATEMALA: Whoever wins will have a hard time

    24 April 2007 Hits: 365

    The lineup in congress leaves none of the three leading parties even close to a majority, with a disparate pool of potential allies.

    Three things are now clear in Guatemala. The first is that the presidential runoff in December will be between rightwinger Oscar Berger, of the Gran Alianza Nacional) and Alvaro Colom, of the left-of-centre Unidad Nacional de la Esperanza (UNE). The second, that whoever wins will have a hard time ruling, as he will not enjoy a majority in congress. The third, that former dictator Efraí­n Rí­os Montt and his Frente Republicano Guatemalteco (FRD) intend to continue as a force to be reckoned with, and has the wherewithal to do it.

    Though congressional results are still provisional (new votes must be cast in seven districts where violence forced the annulment of the first attempt), the main elements of the new lineup are already visible:

    • Berger's Gana is expected to have 49 seats: 33 more than the member parties of the alliance enjoy in the outgoing congress, but 31 seats short of a majority.

    • Colom's UNE has won an estimated 33 seats: 28 more than in the current congress, but 47 short of a majority.

    • Rí­os Montt's FRG is reckoned to have won 42 seats: 17 fewer than at present, and 38 short of a majority.

    This leaves a pool of 34 seats in the hands of smaller parties, theoretically enough for Berger, but neither of the other two, to bring into a coalition avoiding a deal with either the UNE or the FRG. This, however, is an extremely improbable scenario. This same pool, though, could allow any of the two big parties that ended up in opposition to outvote the ruling party. Clearly, Colom would have a harder time than Berger as a ruler. The FRG, on the other hand, has the capability to become a spoiling force that could make life difficult even for Berger.

  • DOMINICAN REPUBLIC: Protest strike succeeds, at high cost

    24 April 2007 Hits: 268

    Clashes with police leave a toll of seven dead; strike organisers give government a 30-day deadline to meet their demands.

    The 24-hour general strike to protest President Hipólito Mej ¡a's economic policies (WR-03-44) was a success for the organisers and a tragedy for the government, as attempts to curb the protest resulted in seven deaths (six civilians and one policeman) and a large number of injuries. In the runup to the strike the police made about 600 arrests and reported the seizure of 89 pistols, 18 revolvers, 12 rifles, 410 knives, and more than 5,000 tyres meant to be used in barricades. On the day of the strike itself, street demonstrations and clashes were confined to a number of `hot spots'; otherwise, most of the country came to a standstill, its streets deserted.

    The strike organisers have given the government a 30-day deadline to comply with their demands, which include lowering the prices of basic goods (including fuels), ending the power blackouts (see page 15), increasing the salaries of government employees (including the military), allocating 5% of the budget to the state university, and guaranteeing that Father Rogelio Cruz, a leader of social protests, is not posted away.

    PRD nomination saga continues  
    The split in the ranks of aspirants to the ruling PRD's presidential nomination (WR-03-44) has not settled matters: the two camps have now separately asked the party's national executive committee to set a date for a nominating convention - but each one with a different set of rules.

    The group that President Mejí­a has attracted to his side (Vice-President Milagros Ortiz Bosch, tourism minister Rafael Suberví­ and Enmanuel Esquea) want, of course, a contest in which reelection is allowed. The other camp (party leader Hatuey Decamps, Ramón Alburquerque, Rafael Flores Estrella and José Rafael Abinader) wants reelection ruled out. This poses a dilemma for the executive: PRD tradition is opposed to reelection, but Dominican law allows it - so can the party allow someone seeking reelection to run for the presidential nomination, or, conversely, can it bar something that is legal?

  • CUBA-US: Closed-doors move retains travel ban

    24 April 2007 Hits: 356

    Preempting a presidential veto, the Republican leadership in the US Congress manoeuvred on 12 November to reverse the decision by both chambers to lift the ban on travel to Cuba. They did this by removing the `Cuba travel amendment' from the Transportation-Treasury Appropriations bill for 2004, without giving a conference committee the opportunity to vote on it.

    A conference committee's purpose is to reconcile differences between the versions of a bill passed by the House of Representatives and the Senate. On this particular issue, there were no differences: the same amendment had been passed by the House in September (on a 227:188 vote) and by the Senate in October (59:36).

    The amendment in question would have pulled the teeth of the travel ban by removing the restrictions on spending in Cuba. In a separate, more direct move, the Senate's foreign relations committee approved a bill, on a 13:5 vote, to lift the ban completely.

    The votes on the Cuba travel amendment show a strong shift of congressional opinion against it, though not enough to overturn a presidential veto.The trend does suggest that it will not be long before that threshold is reached and surpassed. For now what appears to count most is the weight of the Cuban-American vote in the forthcoming presidential elections. Informal soundings by the media suggest that among Cuban-Americans the prevailing mood is still in favour of the embargo and the travel ban.

  • Tracking trends

    24 April 2007 Hits: 257

    DOMINICAN REPUBLIC | Power shortage becomes critical. Electricity generating companies were reporting towards the end of last week that they had only a few days' worth of fuel left. This was the combined effect of the suspension of cheap Venezuelan oil supplies under the San José agreement (due to the Dominican Republic's alleged tolerance of anti- Chávez plotting) and the financial squeeze created by growing government arrears on its debt with the power utilities.

    By 14 November supply had fallen to only half of demand. Blackouts in a number of Santo Domingo neighbourhoods were lasting up to 18 hours, and in other parts of the country even more. President Hipólito Mejí­a belatedly ordered a payment of US$30m to the power utilities (EdeNorte, EdeSur and EdeEste are jointly owed US$357m) and told finance minister Rafael Calderón to speed up negotiations with the World Bank for the disbursement of US$100m for the electricity sector. One hopeful sign is that Venezuela has indicated its intention to renew oil shipments, but in the best of cases this will take about a week.

    CUBA | Growth of 2%-plus predicted. The Cuban economy is likely to grow this year by more than 2%, according to Osvaldo Martí­nez, chairmen of the national assembly's economic affairs committee. This compares with 1.1% growth last year.

    Martí­nez has been talking up this forecast, noting that it is above the average forecast by Eclac for the region as a whole, and that this is the third year running in which the economy registers `moderate' expansion. The most appropriate benchmark, though, is the official target of 4% annual growth set to achieve recovery from the economic contraction of the 1990s.

  • Tracking trends

    24 April 2007 Hits: 263

    DOMINICAN REPUBLIC | Power shortage becomes critical. Electricity generating companies were reporting towards the end of last week that they had only a few days' worth of fuel left. This was the combined effect of the suspension of cheap Venezuelan oil supplies under the San José agreement (due to the Dominican Republic's alleged tolerance of anti- Chávez plotting) and the financial squeeze created by growing government arrears on its debt with the power utilities.

    By 14 November supply had fallen to only half of demand. Blackouts in a number of Santo Domingo neighbourhoods were lasting up to 18 hours, and in other parts of the country even more. President Hipólito Mejí­a belatedly ordered a payment of US$30m to the power utilities (EdeNorte, EdeSur and EdeEste are jointly owed US$357m) and told finance minister Rafael Calderón to speed up negotiations with the World Bank for the disbursement of US$100m for the electricity sector. One hopeful sign is that Venezuela has indicated its intention to renew oil shipments, but in the best of cases this will take about a week.

    CUBA | Growth of 2%-plus predicted. The Cuban economy is likely to grow this year by more than 2%, according to Osvaldo Martí­nez, chairmen of the national assembly's economic affairs committee. This compares with 1.1% growth last year.

    Martí­nez has been talking up this forecast, noting that it is above the average forecast by Eclac for the region as a whole, and that this is the third year running in which the economy registers `moderate' expansion. The most appropriate benchmark, though, is the official target of 4% annual growth set to achieve recovery from the economic contraction of the 1990s.

  • Brazil extradites `Hizbollah fundraiser' to Paraguay

    24 April 2007 Hits: 505

    Most unusually, the Brazilian government has granted the extradition to Paraguay of Assad Ahmad Mohamad Barakat, accused of being the main fundraiser in the Triple Border area for the Lebanese party Hizbollah. Barakat is of Lebanese origin. What is unusual is that Barakat has a Brazilian wife and children, a situation that has traditionally been a shield against extradition.

    The Paraguayans had requested Barakat's extradition on charges of `criminal association, apology of crime and tax evasion'. The first two are linked to his alleged role as a fundraiser for an organisation the US has classified as terrorist. On the strength of recent, similar cases, though, it is most likely that only the latter one might pass muster to the extent of serving to put Barakat on trial. Business associates of Barakat's have been prosecuted on similar charges.

    The US ambassador to Brazil, Donna Hrinak, recently dismissed the claims that the Triple Border area is a hotbed of support for international terrorism, and even stated that most financial contributions flowing to the Middle East were `legitimate'. Barakat has admitted to contributing to a Hizbollah charity and to the construction of a mosque by his brother, Akram Assad Barakat, who is active in Hizbollah in Lebanon.

    It should be noted, however, that after Hrinak's pronouncements, other US officials have renewed the claims about support for international terrorism in the Triple Border area. All this will focus attention on the legal proceedings against Barakat, inasmuch as they might help cast more light on the real situation.

  • BRAZIL: Lula sets agrarian reform goal

    24 April 2007 Hits: 320
    Distribution of land to 400,000 families is the highest target yet — but it is less than half what the MST is demanding.

    President Lula da Silva managed to harvest applause from an audience of 2,400 landless peasants who had marched to Brasí­lia to demand a greater effort on agrarian reform, and he did so despite making it quite clear that he would not be satisfying their demands. This, however, could well have been just a momentary response to Lula's charismatic style: João Pedro Stédile, one of the leaders of the movement of landless peasant, MST, said, `The only way to get these people [the government] to heed us is to go on invading latifundia.'

    So far this year, there have been 202 such land invasions, as against 103 in the whole of last year. The government has announced that it will more than double the annual budget for the agrarian reform, taking it from R$1bn (US$340m) to R$2.6bn (US$884m). Lula told the peasants encamped in Brasí­lia that he intended to distribute land to 400,000 families during his term of office, which ends in 2006.

    That is the highest target ever set by a Brazilian government, but it is only 40% of what the MST wants. The MST wants land to be distributed to 120,000 families this year; the government's target is 60,000, and even that is in doubt, as so far only 21,400 have received their allocation. The MST's target for new year is 200,000 families; the government has yet to come up with a figure.

    Appeal for patience
    During his electoral campaign, Lula kept repeating that carrying out the agrarian reform was an easy matter. All that was required, he said, was political will. When he addressed the peasants in Brasí­lia last week, his main excuse was that `things are not always as one would wish'; he had received an indebted country, with an economy at risk due to the lack of confidence among international investors and financial markets. Moreover, he said, it was not just a matter of throwing money at the problem, but also of providing the infrastructure needed to make the redistributed land yield profitably.

    `A step in the wrong direction,' he told his audience, `would mean having to go back and inflict suffering on those who already suffer [...] We are going to ensure economic stability in this country, and we are going to carry out the agrarian reform with the necessary tranquillity.'

    His minister of agrarian development, Miguel Rossetto, was more apologetic. When he addressed the same audience (before Lula) he admitted that the government had done `very little' on agrarian reform. He, too, invoked budget constraints as a justification, but also apportioned blame to what he described as the excessive bureaucracy of the legislature and the judiciary. The implication, along the lines of Lula's old `political will' argument, is that more could be done to expedite the expropriation of land eligible for redistribution under agrarian reform legislation. The MST argues that its much criticised land invasions are in line with the constitutional provision that makes idle or underutilised land subject to redistribution.

  • ECUADOR: Gutiérrez fights drug-link claims

    24 April 2007 Hits: 377
    Several sources point to contacts with a businessman and former governor arrested on drug-trafficking charges in October.

    President Lucio Gutiérrez has been stumbling from one political upset to another. No sooner had he recovered from the embarrassment caused by Alejandro Nájera, one of his advisers, by making public a blacklist of `enemies of the government', than a leading newspaper El Comercio, was claiming that his campaign was at least partly funded by a recently arrested drug trafficker.

    The newspaper's still unidentified source, said to belong to SP, has also claimed that Gutiérrez was warned about the inadvisability of receiving a US$30,000 contribution from César Fernández, a shrimp farmer and agricultural entrepreneur who was governor of the central coastal province of Manabí­ in the 1990s, and whose brother Luis frequently socialises with leading politicians of all parties.

    As a result of a two-year investigation in cooperation with the DEA and the Mexican antinarcotics police, the Ecuadorean authorities arrested Fernández on 27 October, and seized caches of cocaine and a light aircraft. He is charged with being the Ecuadorean point man for an international ring with links to the Juárez cartel in Mexico and Colombian traffickers from Cali.

    Links, but how close?
    Vice-President Alfredo Palacio has admitted that Fernández supported Gutiérrez's campaign, but did not confirm that this had included financial contributions. The Manabí­ newspaper El Diario published a campaign-trail photograph taken last October showing Fernández standing close to Gutiérrez's brother and just behind Gutiérrez and his wife. Tourism minister Hernán Plaza has admitted to having used an aircraft provided by Fernández.

    Congressman Mario Touma, leader of the Partido Roldosista Ecuatoriano (PRE) in congress, has accused Napoleón Villa, director of the ruling Sociedad Patriótica (SP), of having dined with drug traffickers from Mexico and France, suggesting that he travelled at their expense to China and their countries of origin, and of having bought a US$700,000 building in Quito. Villa has been avoiding the press. There have also been claims by one of the people arrested with Fernández that a police colonel kept them informed of the progress of investigations into their activities — apparently not too efficiently.

    Gutiérrez has decided to set up an independent `truth and transparency' commission to investigate the allegations. The official line is that this `closes the issue' in the political arena, leaving open only the eventual judicial consequences — which could include nullifying Gutiérrez's election if the financial contribution were to be confirmed. An opinion survey conducted by Market shows Gutiérrez's credibility falling to 15%, and 83% of respondents convinced that persons close to the President have links with drug traffickers (while only 36% think this is true of the President himself). Demonstrating that it is possible to hold a variety of views at the same time, 57% of the respondents believe that the accusations of narco links are part of a plot to destabilise the government.

  • PARAGUAY: Duarte's honeymoon starts fraying

    24 April 2007 Hits: 376
    Image as anticorruption campaigner loses shine after dismissed minister gets a new job earning more than the President.

    Even as Paraguay's congress rushes ahead with the impeachment of the three supreme court justices who refused to resign [WR-03-42], the honeymoon enjoyed by President Nicanor Duarte is beginning to fray a little. What is emerging as a vulnerable flank is Duarte's self-presentation as a champion of a drive to eradicate corruption.

    His early record on this front was impressive. He removed the director of customs, the head of the social security institute, and the president of the state oil company, Petropar, and purged the upper echelons of the police. When he set about advocating the cleansing of the supreme court, it was, said Duarte, because they `applied the law to the poor and not to the manguruyú' — the latter literally a huge, voracious bottom-feeding fish, and by extension the big moneygrabbers of Paraguay.

    That he was in earnest appeared to be proven when he forced the interior minister, close friend and former campaign manager Roberto González, to resign over a case of smuggled compact disks, saying that this was a sacrifice made in order to defend `the honour of the government and the hope of the nation.' This marked the apex of Duarte's image as an anticorruption campaigner. Soon afterwards the first chink appeared: González was appointed counsellor at the Yacyretá hydroelectric complex, a job that pays better than the presidency, let alone the interior ministry.

    Then charges of shady dealings began to be aimed at other officials: health minister Julio César Velázquez, Duarte's private secretary Adrián Castillo — even Vice-President Luis Castiglioni, accused publicly by former Petropar president Federico Zayas of involvement with a fuel supplier who had systematically overcharged the state oil company.

    That last charge has been attributed to vindictiveness on the part of Zayas, but a more political explanation has also been circulating: that an attempt is afoot to thwart a bid by the argañista faction of the ruling Colorado party to set up Castiglioni as a rival power centre in the government. There is in circulation a telling batch of rumours about argañistas landing government contracts through the Vice-President's influence.

  • ARGENTINA: Deadlock on Alfonsí­n laws

    24 April 2007 Hits: 317
    Argentina's supreme court is split down the middle over the validity of the `Alfonsí­n laws' that shielded officials of the military government of 1976-83 from criminal prosecution. This was admitted by Enrique Petracchi immediately after his election as president of the court on 17 November. These laws have been declared null and void by congress, but there are serious doubts about the constitutionality of that step. Hopes that the supreme court would settle the issue independently, as it ruled on a case already before it, have now suffered a setback.

    Petracchi replaces Carlos Fayt, who took over the interim presidency of the court after Julio Nazareno resigned last July to avoid impeachment by congress [WR-03-25]. Quite unexpectedly, President Néstor Kirchner publicly congratulated Petracchi on his election, which has been interpreted as signalling that he is not among the justices who might yet face impeachment proceedings.

  • CHILE: After Chávez, Lula on Bolivian claim

    24 April 2007 Hits: 307
    Chilean overreaction to an off-the-cuff remark by Venezuelan President Hugo Chávez sympathising with Bolivia's demand for the recovery of its outlet to the sea may have opened the door for others to start exerting real pressure on Santiago. Chile wrested Bolivian territory on the Pacific in a war in 1879, and Bolivia has been seeking to reclaim it ever since.

    The government of President Ricardo Lagos recalled its ambassador to Venezuela `for consultations', and after a few days, Venezuela reciprocated. Bolivian President Carlos Mesa then publicly thanked Chávez for his support. Then Brazilian President Lula da Silva stepped in, saying, `It is not possible that we should not have some political evolution — that we should be 21st-century leaders thinking about the 22nd century, yet still politicking over something that happened in the 19th.' He said he believed that `with calm and patience' a negotiated solution was achievable. Chile defensively says this is a bilateral problem, not a multilateral one.

  • Tracking trends...

    24 April 2007 Hits: 376

    BRAZIL | Bolder interest-rate cut. The central bank's monetary committee last week responded to the rising pressure to do something about Brazil's poor growth outlook by lopping 1.5 points off the benchmark interest rate, leaving it at 17.5%. This is the lowest since the 16.75% recorded in May 2001, but is still very high in real terms, with inflation heading for a rate of slightly more than 10% in the year.

    Interesting to note: market analysts, accustomed to the central bank's ultra-cautious behaviour, had almost unanimously predicted a smaller rate cut.

    ARGENTINA | Measuring ability to pay. Argentina is only able to pay 15.3% of the US$92.1bn it owes private bondholders, according to a study conducted by the Instituto Argentino de Mercados de Capitales — and this is assuming a primary fiscal surplus held at 3% of GDP until 2032, and a GDP growth rate of 6% in 2004, 5% in 2005-06, 4% in 2007 and 3% from 2008 onwards.

    This ability to pay matches the government's offer of a 75% `haircut'. The institute notes that it would increase to more than 42% if the multilateral creditors were not granted priority, as at present.

    ARGENTINA | Growth outlook. Economic activity inched upwards by 0.1% between August and September, taking the accumulated increase in the first nine months to 7.3% over the comparable period of 2002. The September level of activity is almost the same as that of October 2001, just prior to the collapse of the economy.

    Much has been made of a 2.6% increase in industrial production between September and October, but this looks less impressive when it is set against the 1.4% decline registered in September. Similarly, the 16% year-on-year improvement recorded in October pales somewhat when it is considered that in October 2002 industrial output was at one of its lowest points.

    URUGUAY | Growth outlook. A further sign that Uruguay is finally pulling out of its long recession was provided by figures showing that industrial sales in the third quarter of the year were running 11% above the same period of 2002, with September sales up 30.7% year-on-year.

  • PERU: The fall and fall of Toledo

    24 April 2007 Hits: 298
    The President has reached the point at which his reviled predecessor Alberto Fujimori more than doubles his approval rating, and his officials and even policies poll better than him.

    One of the few things from which President Alejandro Toledo can draw comfort is the opinion poll finding that a majority of Peruvians (53%) believe he will make it to the end of his term of office. Almost everything else in the most recent survey conducted by Datum is negative.

    The President's approval rating, which reached 59% when he took office in July 2001, has fallen to 12%. The public seems to like him less than his government or its policies; prime minister Beatriz Merino has an approval rating of 47%. Most humiliating, fugitive former President Alberto Fujimori's rating is more than twice as high as Toledo's, at 28% — despite the revelations about the extent of corruption in his government.

    Fujimori, who has vowed to return to Peruvian politics, also ranks third in voting intentions countrywide, with 14% (after former presidents Alan Garcí­a, who attracts 21%, and Valentí­n Paniagua, with 20%). This can be linked with another finding by Datum: 40% of the respondents declared themselves unsatisfied with Peru's current system of government and in favour of rule by a strong leader.

    Add to this that 52% have few hopes that their situation will improve under Toledo, and that 57% fear that Peru could slide into social explosions like those experienced in October by Bolivia. Support for Fujimori is strongest in the poorest strata and highly localised in Lima, where a third of the respondents expressed their preference for him.

    Reaction at the top
    Among those close to Toledo, a favourite complaint is that the media are almost universally hostile. Recently his controversial wife, Eliane Karp, took journalists to task, asking, `Why have you never mistreated Alan Garcí­a, or asked him questions knowing that he has accumulated an extraordinary fortune? Why don't you ever ask him about his extramarital affairs?' Toledo later apologised for this outburst. In the Datum poll, Karp appears with a disapproval rating of 79%.

    Datum director Manuel Torrado says that one of Toledo's handicaps is his perceived inconsistency. Just after the poll was released he provided an example. Toledo's advisers had told him that his frequent trumpeting of economic success indicators clashed with the majority's perception that they are seeing no improvement in their lot. Last week he seemed to have taken the message to heart, proclaiming his disappointment with the scant diffusion of benefits. `We cannot continue,' he said, `with a situation in which macroeconomic statistics are good, but little of that is felt in the citizen's pockets.' He reminded everyone that 54% of Peruvians are living below the poverty line, and 23% in extreme poverty.

    This was, however, just a rhetorical flourish before he returned to his previous self-congratulatory line. `We are not happy with what we have achieved,' he said. `At the end of October, employment was 1.7% higher than a year earlier — but we are not happy.' 

    He went on to proclaim that poverty in rural areas had been reduced from 46.6% in the last quarter of 2001 to 42.1% in mid-2003, and noted that Peru's GDP will grow this year by 4%, with inflation down at 2.5%.

  • GUATEMALA: Only Indian votes matter

    24 April 2007 Hits: 338
    A mere 8% of the newly elected congressmen come from the 23 indigenous ethnic groups that make up 41% of the population, and most of Guatemala's landless poor.

    The two candidates heading for the presidential run-off, Oscar Berger and Alvaro Colom, are already having to face at least one manifestation of the group most neglected by all politicians in the general elections: Guatemala's Indians, who account for 41% of the population. The manifestation they face is an extreme one: the former members of the `civilian self-defence patrols' (PACs) who served on the frontline of the counterinsurgency campaign in the 1980s and have sporadically acted as shock troops for the ruling Frente Republicano Guatemalteco (FRG).

    Well aware that they are a force to be feared, the 520,000 former PACs last year extracted from President Alfonso Portillo the promise to pay compensation for their military services, at a rate of US$640 each. When the money did not materialise, in the run-up to the elections they kidnapped four journalists to extort from Portillo a commitment to disburse the funds immediately. Portillo agreed, but the ex-PACs maintained until the last minute a threat to boycott and disrupt the elections if he failed to deliver a first instalment of US$120.

    The threat was lifted even though the government had only managed to pay 76% of the ex-PACs. The former militias then shifted their attention to the candidates headed for the run-off, since payment of the remaining two instalments was left by Portillo to the new administration (clearly a ploy designed to attract votes to FRG candidate Efraí­n Rí­os Montt, which failed). This will cost the new government about US$200m.

    The ex-PACs have already held a negotiating session with frontrunner Berger, chiefly because until recently Colom had been promising to halt the compensation payments and put the former militiamen on trial for human rights abuses (they have been accused of some of the worst atrocities in the internal war that formally ended with the 1996 peace agreements). They have offered to vote for Berger if he puts in writing a promise to pay the balance of the promised compensation. Berger had already stated that he would honour Portillo's agreement because it was `a state commitment', but the ex-PACs want this in black and white.

    Unseen by the parties
    The high visibility of the former PACs did not make the political parties more sensitive to the demands of Guatemala's indigenous population. Beyond a few flights of rhetoric, the extent of their real interest was illustrated by the fact that the number of indigenous candidates was just under 10% (spread out among the 17 competing parties), and many of these were placed so far down the lists that their election was far from assured. As it turned out, only 13 of the 158 candidates elected to the single-chamber congress are Indians. This is an improvement on the 8 indigenous seats in the outgoing congress, but still grossly disproportionate to their share of the population.

    Discrimination against Guatemala's 23 indigenous ethnic groups is most visibly expressed in the fact that the country remains firmly monolingual. Less visible (because ignored) is the fact that the poverty rate, 57% of Guatemala's total population, rises to 70% of the indigenous population (the relative rates of extreme poverty are 16% and 21%).

    The land issue
    These figures do not take into account the worsening of the Indians' lot over the past couple of years due to the crisis in the coffee industry: since the beginning of 2002 some 200,000 seasonal jobs have been lost. These are vital to the indigenous population, which otherwise must rely on subsistence agriculture in marginal lands. The degree of concentration of land ownership in Guatemala is extreme even by Latin American standards: 70% of the land is in the hands of 0.15% of the population.

    Though their actions have been overshadowed by the attention focused on Rí­os Montt's presidential bid, the landless peasants of Guatemala, mostly Indians, have been emulating their peers in Brazil, staging land invasions. Since the beginning of last year they have invaded at least 115 fincas, which given Guatemala's size, is even more impressive than the 305 invasions recorded in Brazil in the same period.

  • BOLIVIA: Proceedings against Goni — and others

    24 April 2007 Hits: 418
    Impeachment proceedings have been formally requested against former President Gonzalo (Goni) Sánchez de Lozada for alleged human rights abuses during the repression of the protest movement of last October, which ultimately resulted in his resignation [WR-03-41]. Chief prosecutor Oscar Crespo filed the request with congress on 21 November, after having studied six separate accusations brought by private individuals.

    Crespo did not, however, confine his attentions to Goni: also included in his request are Goni's cabinet, plus protest leaders Evo Morales, Felipe Quispe and Alejo Véliz. A successful impeachment would bar those accused from holding public office, and the files would be passed on to the supreme court for eventual criminal prosecution.

    This is the first time proceedings have been brought against a head of government since former dictator Luis Garcí­a Meza (1980-81) underwent a 7-year trial in absentia, which ended with his being sentenced in April 1993 by the supreme court to 30 years' imprisonment, Bolivia's maximum. Garcí­a Meza was extradited from Brazil in 1995.