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El Presidente electo Juan Manuel Santos está dando cuerpo al equipo del gabinete que lo acompañará cuando asuma el poder el 7 de agosto. Durante una mini gira por Europa la semana pasada con su futura canciller, Marí­a Angela Holguí­n, Santos nombró a cuatro ministros más. El nombramiento de Juan Camilo Restrepo como ministro de agricultura fue el más curioso. Santos ha señalado al desarrollo agrí­cola como una de las cinco “locomotoras" del crecimiento, junto con energí­a, infraestructura, vivienda e innovación. Restrepo dijo que uno de los principales desafí­os que se habí­a fijado era una sustancial reforma agraria, que consistirá en devolver tierras a quienes fueron desplazados por las guerrillas y los paramilitares.

Santos se reunió con el Primer Ministro británico, David Cameron; la Canciller de Alemania, Angela Merkel; el Presidente de Francia, Nicolas Sarcozy; y finalmente el Presidente de España, José Luis Eodrí­guez Zapatero y el Rey Juan Carlos I, durante su visita en Europa. También se reunió con Angel Gurrí­a, el secretario general de la Organización para la Cooperación y el Desarrollo Económico (OCDE), de 34 miembros, buscando el apoyo de los lí­deres europeos para que Colombia se convierta en miembro de la OCDE.

Uno de los mensajes centrales que Santos llevó a Europa fue que, pese a su enorme respeto por el Presidente Alvaro Uribe, él actuarí­a por sí­ mismo. Dijo que el éxito de Uribe en devolver la seguridad a Colombia significa que él podrá concentrarse en otras prioridades. La prioridad principal, dijo, era la polí­tica económica -y el enfoque central de esa polí­tica serí­a el desarrollo agrí­cola. Deliberadamente dijo que no habí­a discutido el tema de los rehenes con Sarkozy, que hizo del rescate de la polí­tica Franco-Colombiana, Ingrid Betancourt, una de sus prioridades en polí­tica exterior después de asumir el poder, sino la asistencia francesa para mejorar la infraestructura en Colombia para el desarrollo agrí­cola.

La elección de Restrepo para dirigir el ministerio de agricultura es reveladora. Restrepo, de 63 años, es un ex ministro de finanzas, miembro del Partido Conservador, y experto en café. Fue uno de los primeros jefes de Santos, enviándolo a Londres para representar a Colombia en la Organización Internacional del Café (OIC), la organización intergubernamental de paí­ses exportadores e importadores de café con base en Londres. Restrepo se graduó como abogado en la Universidad Javeriana, especializado en derecho económico en la London School of Economics (LSE). Su pericia legal es una de las razones principales por la cual Santos lo designó. Santos desea que él organice y dirija la batalla legal para recobrar las tierras de agricultura para los campesinos desplazados por las guerrillas y los paramilitares -una tarea que estará cargada de dificultades.

Restrepo dijo que él trabajará duramente para normalizar el comercio con Venezuela, que él dijo que era vital para el desarrollo del sector agrí­cola, pues Venezuela importa la mayor parte de sus alimentos. También trabajará muy de cerca con el ministerio del medioambiente, bajo Sandra Bessudo, una bióloga marina. El del medioambiente ha sido incluido dentro de un enorme ministerio que incluye vivienda y desarrollo territorial, pero ahora tiene su propia cartera. Santos arguyó que Colombia es uno entre unos pocos paí­ses que posee una cantidad considerable de tierra para incrementar la producción de alimentos sin sacrificar la selva tropical.

Santos también nombró a Carlos Rodado como su ministro de minas y energí­a -otra de las locomotoras del crecimiento. Rodado ocupaba ese cargo bajo el ex presidente Julio César Turbay Ayala (1978-1982) y fue presidente de la compañí­a petrolera estatal Ecopetrol bajo el ex presidente Andrés Pastrana (1998-2002). Ha sido gobernador del departamento de Atlántico y, hasta que se unió al equipo de campaña de Santos, fue embajador ante España. Rodado dijo que buscarí­a un equilibrio entre una mayor apertura del potencial minero de Colombia y la conservación de los recursos naturales. Finalmente, Sergio Dí­az-Granados será el ministro de comercio, industria y turismo. Su designación confirma la determinación de Santos de poner un mayor énfasis en el turismo después de los avances logrados en la situación de la seguridad bajo Uribe. Dí­az Granados fue presidente de la Asociación Colombia de Viajes y Turismo (Anato) y viceministro de desarrollo por tres años, bajo el gobierno de Uribe. El es secretario general del Partido de la U, y trabajó bajo Santos cuando era ministro de finanzas.

• Farc

En tres dí­as sangrientos, entre el 10 y el 12 de julio, 40 personas -21 guerrilleros, 14 soldados y cinco civiles- perdieron sus vidas en incidentes separados en el conflicto interno de Colombia. Doce guerrilleros de las Farc cayeron en Planadas, en el departamento central de Tolima. Pertenecí­an al destacamento de seguridad del lí­der de las Farc, Alfonso Cano, lo que sugiere que los militares están cerca de cumplir con el objetivo del Presidente Alvaro Uribe de propinar un golpe decisivo contra las Farc capturando a Cano y al lí­der militar del grupo 'Mono Jojoy' antes que Santos asuma el poder el 7 de agosto, para de ese modo consolidar su legado como el hombre que puso a las Farc de rodillas.

Reclamo de Betancourt aviva el fuego del resentimiento
El Presidente electo Santos ha sido sorprendentemente exitoso en forjar algo no muy lejano de su ansiado gobierno de unidad nacional, pero él debe haber mirado con cierta admiración la manera en la cual Ingrid Betancourt ha unido esta semana a cada sector de la opinión, civil, militar, polí­tico y de los medios. El único problema para Betancourt, la ex candidata presidencial Franco-Colombiana que estuvo seis años como rehén de las Fuerzas Armadas Revolucionarias de Colombia (Farc) antes de ser liberada en la operación militar de rescate 'Jaque' hace dos años, fue que ella unió a la opinión pública en su contra. En una gaffe de relaciones públicas de extraordinarias proporciones, Betancourt hizo una movida preliminar buscando compensación en el orden de los Col$13bn (US$6,84m) del Estado por su tiempo como rehén. Betancourt y su familia requirieron una 'conciliación' -un proceso alternativo de resolución de disputas entre sus abogados y el Estado- para discutir una compensación que, en el caso de no haber acuerdo, podrí­a conducir a que se inicie juicio.
     La apelación de Betancourt provocó la indignación nacional. Ella fue vilipendiada por los militares, el gobierno y la prensa. El Vicepresidente Francisco Santos la acusó de “codicia, ingratitud y oportunismo, mereciendo el rechazo de los colombianos y la opinión mundial". Al otro lado del espectro polí­tico, el lí­der del opositor Polo Democrático Alternativo (PDA), Gustavo Petro, dijo simplemente que Betancourt habí­a sido secuestrada por las Farc y no por el Estado, y disfruta de su libertad debido a una exitosa operación militar.
     El ministerio de defensa expresó sorpresa y tristeza. Dijo que Betancourt habí­a sido advertida repetidas veces acerca de los peligros de ingresar en territorio de la municipalidad de San Vicente del Caguán como parte de su campaña electoral, lo que por último condujo a su secuestro en julio de 2002, y que habí­a firmado documentos asumiendo la responsabilidad plena por sus acciones. La revista Semana calificó de “vergonzoso" el reclamo de Betancourt, mientras otros medios especulaban con que ella deberí­a pagar compensación por una costosa operación militar en la cual las tropas pusieron sus vidas en riesgo por ella.
     Podrí­a ser que Betancourt fue “muy mal asesorada", como uno de sus compañeros rehenes liberados durante la operación Jaque, el ex senador Oscar Tulio Lizcano dijo caritativamente, pero el repudio en Colombia fue tan intenso que ella se vio forzada a embarcarse en un ejercicio de limitación del daño. En una entrevista con Caracol TV y radio de Colombia, el 11 de julio, una escarmentada Betancourt insistió que ella no tení­a la intención de enjuiciar al Estado por daños; que ella lamentaba haber iniciado el proceso; que la cifra de US$6,8m era “absurda" y “astronómica" y puramente “simbólica"; que ella habí­a estado motivada solamente por un impulso altruista para ayudar a otros ex rehenes a obtener compensación; y que ella amaba a los militares y a su paí­s.
     Betancourt, que retornó a Colombia la semana pasada por primera vez desde su rescate, para celebrar los dos años desde la operación 'Jaque', sin embargo, no se echó atrás en sus reclamos, que ella habí­a sido falsamente acusada de irresponsabilidad por realizar el viaje que terminó en su secuestro. Ella dijo que las autoridades habí­an retirado a sus guardaespaldas y que le debí­an haber impedido ir a San Vicente del Caguán, un bastión de las Farc en el departamento de Caquetá en el sur. Luego de su rescate, Betancourt habí­a aceptado públicamente que a ella debí­a culparse por insistir tercamente en visitar el Caguán. Pero si su conciliación fue diseñada como simbólica, ¿por qué la cifra de US$6,8m en vez de un peso? Para ser justos con Betancourt, ha surgido esta semana que otros cuatro ex rehenes de las Farc (que fueron todos secuestrados en el departamento de Huila en el sudoeste) recientemente han comenzado a buscar compensación por magnitudes semejantes del Estado, pero ellos tienen casos mucho más fuertes contra el Estado, por “negligencia".

El 2 de noviembre, EU celebró sus elecciones de mitad de periodo, que produjo un giro en ambas cámaras del congreso contra el Presidente Barack Obama. Separadamente, 37 estados celebraron elecciones gubernamentales y California votó decididamente contra la completa legalización de la marihuana para consumo personal.

El amplio triunfo Republicano en la Cámara de Representantes fue compensado por la retención por los Demócratas de una estrecha mayorí­a en el Senado. Estos resultados que ocuparon titulares, junto con la derrota de la legalización de la marihuana en California (Proposición 19), y la elección de dos gobernadores de estado hispanos (en New Mexico y Nevada), sugieren que la polí­tica de EU hacia México durante el próximo par de años, especialmente sobre la inmigración, es probable que cambie.

Arturo Sarukhan, el embajador de México ante EU, no está de acuerdo. Su opinión sobre los resultados de las elecciones es que es improbable que EU cambie sobre la inmigración y que EU permanecerá apoyando las polí­ticas de seguridad del gobierno mexicano. Sobre la inmigración, Sarukhan fue perceptiblemente pesimista: él alegó que los resultados no eran alentadores y que el actual estado de la economí­a en EU no era propicia para una exhaustiva reforma de las leyes de inmigración.

Probablemente, Sarukhan esta siendo muy sombrí­o acerca de la inmigración y quizá confiado en exceso en que no habrí­a un giro en la polí­tica de seguridad de EU hacia México. La afluencia de Republicanos de derecha, especialmente en la Cámara de Representantes, es probable que ponga frenos al gobierno de Obama, incluso si pretendiese   intentar ajustar las leyes de control de armas de fuego.

Puede ser que la administración Obama tenga que abandonar su ahora ya ritual mea culpa que los laxos controles de armas de EU son una de las razones principales para la oleada de muertes en el norte de México. Los funcionarios de Obama, desde el presidente para abajo han dejado contentos   a sus contrapartes mexicanas con esa clase de declaraciones, aunque sus palabras no han conducido a la acción. Bajo el último presidente Republicano, George W. Bush, EU ha relajado las restricciones que cubrí­an la compra de rifles de asalto.

Si EU se aleja de su actual punto de vista, que comparte con México la responsabilidad por el recrudecimiento en la violencia de las bandas en México debido al laxo control de armas y el apetito de drogas ilegales de EU, el gobierno del Presidente Felipe Calderón estará en una difí­cil posición. El gobierno federal y los estados del norte de México ya han protestado y desdeñado las reuniones bilaterales con los estados de EU que han tomado lo que los mexicanos perciben como posiciones anti-inmigrantes. Si el congreso de EU presiona a su gobierno para que asuma posiciones más exigentes (por ejemplo, sobre el respeto a los derechos humanos en México) mientras está haciendo más esfuerzos para sellar la frontera sur, el gobierno mexicano podrí­a volverse más frí­o acerca del apoyo de EU. Un enfriamiento en las relaciones afectará la etapa preliminar de las elecciones presidenciales y legislativas de 2012 en ambos paí­ses.

Antes de las elecciones, el temor en México ha sido que un giro hacia la xenófoba Derecha en la Cámara de Representantes y el Senado hubiese producido un endurecimiento en las leyes anti-inmigrantes. Arizona, cuya gobernadora interina, Jan Brewer, fue electa para un periodo gubernamental el 2 de noviembre, habí­a indicado un formato para esa clase de leyes, con la controversial legislación SB1070. Bajo esa medida, cuya constitucionalidad está siendo considerada por la Corte Suprema, es un delito bajo la ley del estado de Arizona estar en EU ilegalmente, y requiere que los inmigrantes porten consigo la prueba de su status de inmigración. Las violaciones son clasificadas como delitos menores, que pueden ser penalizados con hasta seis meses en prisión y una multa de hasta US$2.500, mientras que las ofensas repetidas constituyen delitos graves. La corte suprema ha comenzado a escuchar los argumentos del gobierno federal contra la SB1070, y los argumentos a favor del Estado de Arizona, el 1 de noviembre.

Para alivio de América Latina, el giro hacia la derecha en la Cámara de Representantes fue compensada por la retención (por poco) del control de los Demócratas del Senado. En verdad, el éxito de Harry Reid (D, Nevada), que orientó su campaña de reelección hacia los hispanos, podrí­a incluso significar que el nuevo senado será más liberal sobre la inmigración que el que está saliendo.

La mayorí­a de la Cámara, sin embargo, será anti-inmigrante con virulencia. El nuevo presidente (Republicano) del comité de asuntos judiciales de la Cámara será el tejano Lamar Smith, del que se tiene registro oponiéndose al derecho constitucional (bajo la Enmienda 14ta) que confiere automáticamente la ciudadaní­a de EU a cualquiera que haya nacido en EU. Smith alega que ese derecho no deberí­a aplicarse a los hijos de migrantes ilegales o indocumentados. Otro derechista Republicano, anti-inmigrante, Steve King (Iowa), es el nuevo presidente del subcomité sobre Inmigración, Ciudadaní­a, Refugiados, Seguridad de Frontera y Ley Internacional. El también se opone a los 'bebés ancla' el término usado por la   derecha para los hijos de migrantes indocumentados nacidos en EU.

Los optimistas tienen la esperanza que la agitación de los legisladores de derecha sobre la inmigración producirá algún tipo de reforma realizable de las leyes de inmigración de EU. Los moderados de ambos lados alegan que EU necesita urgentemente una reforma nacional de inmigración realizable para evitar que los estados sigan el ejemplo de Arizona e introduzcan sus propias leyes. Los moderados afirman además que los Demócratas han sido irresponsables en proponer inviables reformas liberales a las leyes de inmigración a fin de retratar a los Republicanos como anti-liberales, casi racistas. Esa posición Demócrata ha tenido efecto con los votantes hispanos quienes, de acuerdo con las encuestas de opinión, sienten que está creciendo la discriminación en contra de ellos.

Los hispanos son ahora una considerable fuerza, tanto en EU como en la Cámara. Ellos suman ahora el 8% del electorado nacional. Al menos otros ocho hispanos fueron electos para la Cámara de Representantes el 2 de noviembre, llevando su número total a 24. Aún hay solamente dos senadores hispanos: el 2 de noviembre, Marco Rubio, un candidato del Partido del Té (libertario) ganó en Florida, para unirse a Bob Menéndez (D, NJ). Ambos son Cubano-Americanos.

Lo inusual acerca de las elecciones del 2 de noviembre es que seis de los nuevos legisladores son Republicanos. En general, casi dos tercios de los hispanos aún tienden a votar a los Demócratas, muestran las encuestas de opinión. La Asociación Nacional de Latinos Electos y Funcionarios Designados (Naleo, siglas en inglés) señala que los hispanos ahora están ganando bancas en distritos que no tienen una dominante presencia hispana. Raúl Labrador, por ejemplo, ganó en Idaho y Jaime Herrera ganó en Washington.

La elección de un par de gobernadores hispanos Republicanos en Nevada y New Mexico, subraya que la reforma de la inmigración no necesita ser una cuestión polí­tico-partidaria. Es interesante que en Nevada, un Republicano, Brian Sandoval, haya derrotado a Rory Rey, el hijo de Harry, para la gobernación. En New Mexico, Martí­nez está en la derecha, y se opone a la tradición de New México de permitir que migrantes indocumentados porten licencias de chofer de EU.

La clara derrota (54 a 46) de la Proposición 19 en California es una buena noticia para el gobierno mexicano. Si la marihuana hubiese sido legalizada en el estado más rico en EU, la oportunidad para el cambio de la polí­tica de drogas mexicana se hubiese incrementado. Tal como están las cosas, los proponentes de esa legislación tendrán que reconocer que ellos aún deben elaborar un argumento más significativo.

• PAN

El 3 de noviembre, el Partido Acción Nacional (PAN) nominó a Marcos Covarrubias, un ex miembro del Partido de la Revolución Democrática (PRD), como su candidato para la gobernación del pequeño estado de Baja California Sur en 2011. La nominación sugiere que las exitosas alianzas entre el PAN y el PRD en 2010 continuarán en 2011. Eso es probable que estimule las chances de Marcelo Ebrard, el alcalde de Ciudad México, para ganar la presidencia en 2012. Ebrard apoya las alianzas con el PAN, aunque él dice que no desea una alianza para las elecciones presidenciales.

La Presidenta Dilma Rousseff, una ex prisionera polí­tica, desea instalar una comisión de de verdad y justicia en Brasil, para investigar los crí­menes patrocinados por el estado durante el régimen militar del paí­s (1964-1985), pero esta semana, los militares de nuevo aparecieron para expresar fuertes cuestionamientos acerca de remover el pasado.

El ministro de defensa de Rousseff, Nelson Jobim, el ministro de justicia, José Eduardo Cardozo, y la ministra de derechos humanos, Marí­a do Rosário están buscando construir consenso para la aprobación de un proyecto de ley enviado al congreso en mayo de 2010 por el ex presidente Lula da Silva (2002-2010). Según ese proyecto de ley, el principal objetivo de la comisión de verdad y justicia serí­a “la promoción de la reconciliación nacional" y la “explicación detallada de los casos de torturas, muertes, desapariciones forzadas, el ocultamiento de los cuerpos, y sus autores, incluyendo aquellos [casos] que tuvieron lugar en el exterior". En ese entonces, habí­a fuertes rumores que el texto de la ley no fue bien recibido por los militares que, aparentemente, la veí­an como “vengativa".

El 9 de marzo, el ministerio de defensa emitió una declaración negando un informe en el diario O Globo, en el sentido que los militares estaban en contra de una comisión de la verdad. Un dí­a antes, el diario habí­a publicado una carta que decí­a que fue enviada en febrero por las fuerzas armadas al ministerio de defensa, alegando que la comisión “provocarí­a tensiones y seria desafección al someter los hechos del pasado a una nueva discusión". Decí­a en ella que “Brasil ya ha superado ese periodo de su historia"; expresando preocupación acerca de volver a “abrir una herida", y sugerí­a que los proponentes estaban buscando una “retaliación polí­tica".

La declaración del ministerio de defensa decí­a que el texto impreso por O Globo no habí­a sido enviado el mes pasado y era en efecto parte de un intercambio de fecha setiembre de 2010 entre el ministerio y los jefes de las tres fuerzas armadas, a las que se les habí­a pedido que expresen su posición sobre el proyecto de ley. La declaración señala que los militares luego habí­an corregido su posición, ante la “inequí­voca posición del ministerio de defensa en apoyo del proyecto de ley en la forma en que fue presentado al congreso". Finalizaba diciendo, “hay un perfecto entendimiento entre los ministerios de defensa, justicia y derechos humanos con referencia a la materia, con la cual las fuerzas armadas están absolutamente de acuerdo".

El Palacio Planalto dijo más tarde que habí­a pedido una explicación al ministerio de defensa. Rousseff se reunió con los jefes de las fuerzas en diciembre de 2010 y según se informó, pidió su “discreción" con relación a la comisión de la verdad, dejando en claro que esa era una condición para su permanencia en sus puestos. Los militares no han comentado sobre el artí­culo en O Globo. Notablemente, sin embargo, el ministro jefe del gabinete de seguridad institucional, el general del ejército José Elito Carvalho Siqueira, recibió una reprimenda de Rousseff en enero por decir al asumir su puesto que la desaparición de prisioneros polí­ticos “no era vergonzoso" para Brasil. El también habí­a insistido en que Brasil debí­a “tratar el 31 de marzo de 1964 como un hecho histórico" y en cambio mirar hacia adelante. El pidió disculpas y dijo que sus comentarios fueron mal expuestos.

Una larga campaña por la justicia
Luego de su derrota ante la corte suprema, los familiares de las ví­ctimas de Araguaia, bajo el 'Grupo Tortura Nunca Mais', llevaron su caso, que ha estado en curso por casi tres décadas (comenzando en 1982), ante la Corte Interamericana de Derechos Humanos (CIADH). El gobierno brasileño admitió la responsabilidad por las muertes polí­ticas en Araguaia y autorizó las reparaciones para los miembros de las familias en 1995, pero bajo la ley de amnistí­a, los familiares no pueden llevar sus casos a juicio en Brasil. Brasil no ha sentenciado nunca a nadie por delitos cometidos durante la dictadura militar. Los activistas de derechos humanos desean que Brasil abra sus archivos militares para permitir que los casos contra los supuestos perpetradores puedan seguir adelante.

• La caja de Pandora

El 14 de diciembre de 2010, la Corte Interamericana de Derechos Humanos (CIADH) hizo responsable al Estado de Brasil por las desapariciones forzadas de 62 sospechosos de ser militantes de izquierda en la región amazónica de Araguaia a comienzos de los '70 y dijo que Brasil debí­a permitir los procesos por abusos cometidos durante el régimen militar. En mayo de 2010, la corte suprema sostuvo la Ley de Amnistí­a de 1979, que impide realizar juicios y castigos por delitos polí­ticos cometidos durante el gobierno de la junta militar. En Argentina y Uruguay, las leyes de amnistí­a fueron cuestionadas en las cortes (e invalidadas). La decisión de la CIADH podrí­a forzar una reevaluación de la ley brasileña. La ministra de derechos humanos, Marí­a do Rosário insiste en que el gobierno de Rousseff no tiene tales planes. “Eso no corresponde al ejecutivo proponer. Esa debe ser una cuestión para la sociedad," ella dijo en la ONU en Ginebra  esta semana.

En poco más de un año y medio luego que Evo Morales se convirtiera en el primer presidente indí­gena, la marea de creciente reafirmación indí­gena en la región comienza a lucir levemente diferente. Muchos lí­deres indí­genas, incluso en paí­ses con mayorí­as indí­genas, son más concientes de la necesidad de adoptar posiciones polí­ticas más incluyentes, considerando al llamado etnopopulismo como una opción riesgosa. Y crece la percepción que las propuestas de ese sistema corren riesgo de manipulación partidista, igual que la 'partidocracia' tan despreciada por las ideologí­as indí­genas.

El etnopopulismo no es una noción nueva; ha estado rondando desde los '60 y, en América Latina, ha sido aplicado por el régimen de Duvalier en Haití­ y en los movimientos indí­genas en Nicaragua bajo los Sandinistas. Sin embargo, Raúl Madrid, de la Universidad de Texas, lo ha revivido recientemente como una herramienta para entender lo que está ocurriendo en América Latina.

Arguye que Evo Morales representa más a un etnopopulista, que a una manera puramente indí­gena de abordar la polí­tica: la experiencia polí­tica de Bolivia ha mostrado que apelar a lo puramente étnico no fue suficiente para atraer suficiente apoyo de las bases. Por tanto, lo mezcló con elementos del arsenal 'populista': nacionalismo, estatismo, denuncia de las elites e instituciones existentes dentro del paí­s, y del imperialismo en el exterior. Dio resultado: la mayorí­a de los que votaron por Morales en 2005 se identifican a sí­ mismos como mestizos más que como indí­genas (ver páginas 3-4).

Bajo esa luz, la victoria de Ollanta Humala en primera ronda en las últimas elecciones presidenciales en Perú puede ser vista como un éxito etnopopulista. También fue la elección de Lucio Gutiérrez a la presidencia de Ecuador, que colapsó cuando Gutiérrez dio la espalda a los componentes populista y étnico de su campaña electoral. Esa experiencia puede haber sido el punto de inflexión para el movimiento indí­gena de Ecuador, sobre todo porque parece haber adoptado una posición más explí­citamente incluyente en su campaña social (ver páginas 5-6) -y no desplegó el antiguo entusiasmo de la campaña tí­picamente etnopopulista que llevó a Rafael Correa a la presidencia.

En Perú, el lí­der de los productores de coca, Nelson Palomino, ha reclamado éxitos iniciales con su nuevo partido "indí­gena", Kuska Perú, y ha expresado su intención de emular el ascenso de Evo Morales a la presidencia -pero ya dejó en claro que apelarí­a a la inclusión (ver páginas 7-8). Eso sugiere que es conciente de un rasgo de la sociedad peruana que Ladislao Landa ha subrayado: que los pueblos indí­genas ubican su identidad como campesinos antes que su etnia.

También Guatemala es testigo de un intento presidencial de una lí­der indí­gena: Rigoberta Menchú, Nobel de la Paz. Ella creó un partido indí­gena, Winaq, que es explí­citamente incluyente, y conduce su campaña electoral en alianza con un partido mestizo de centro-izquierda, Encuentro por Guatemala (EG), y su compañero de fórmula es un prominente lí­der empresarial (ver páginas 9-10).

Sin embargo, los enfoques étnicos más radicales siguen presentes. Predominan en la polí­tica indí­gena de Chile (ver páginas 10-11), reflejando en parte el hecho que la población indí­gena está altamente concentrada en una región, en parte como respuesta polí­tica a las iniciativas del gobierno de Bachelet con relación al reconocimiento del status y los derechos de los pueblos indí­genas, que son retratadas como impuestas desde arriba en vez de representar los verdaderos deseos de los indí­genas.

Esos enfoques también están presentes en el intento de varias organizaciones indí­genas para establecer un cuerpo para coordinar sus acciones a través de la región andina, la Coordinadora Andina de Organizaciones Indí­genas -que incluye representantes de Chile y Argentina pero, sorprendentemente, dada la posición polí­tica del grupo, no de Venezuela (ver páginas 15-16). Su declaración inaugural rechaza a la nación estado como una herramienta del neocolonialismo, y abraza el extendido ánimo que rechaza el 'indigenismo' como representación del paternalismo del no-indí­gena, a favor del 'indianismo', con el significado de polí­ticas propuestas por los mismos pueblos indí­genas.

Una tendencia menos visible surge de la revaloración del levantamiento del año pasado, que duró cinco meses en el estado sureño mexicano de Oaxaca, a la luz del hecho que ese es el estado más indí­gena del paí­s y, desde fines de los '90, el único donde la mayorí­a de las municipalidades son gobernadas por los "usos y costumbres" indí­genas tradicionales -una de las bases clave de las plataformas indí­genas a lo largo de la región.

El cuadro que emerge es que esas municipalidades prueban ser tan vulnerables a la manipulación polí­tico-partidaria como las que están bajo regí­menes de competencia polí­tica entre partidos, y que los mencionados "usos y costumbres" tradicionales, no aseguran un tratamiento igual para todos los ciudadanos (ver páginas 13-14). Eso provee un nuevo enfoque para la renovación de autoridades, este año, en las municipalidades indí­genas de Oaxaca.

 

Importancia polí­tica de las poblaciones indí­genas Como % de la población total Paí­s 000 de Indios   % de la población Mexico Peru Bolivia Guatemala Ecuador Argentina Chile Colombia 12,000 9,300 5,600 5,300 4,100 1,000 998 744 14.1* 46.5 81.2 66.2 43.2 3.1* 10.3* 2.2* *Altas concentraciones regionales de población indí­gena. Nota: Argentina está incluida debido a la conexión Mapuche (ver páginas 11-12, 15-16). Colombia, debido a la conexión andina (ver páginas 15-16). Fuentes: Las estimaciones se basan, en la mayorí­a de los paí­ses, en datos de principios de los '90, usados por BID, OPS y Cepal; y fines de los '90-2000 para Chile. Los porcentajes de población se basan sobre la población en la fecha que los datos fueron compilados.

 

Next year is an election year and this will impose a (small) extra burden on the budget. The government admits that although investment in social projects is the priority for 2004, it will have to spend a lot of money on the elections, transfers to municipal governments, improving the court system and making a contribution to the old public pension system. All in all, these administrative expenses will swipe US$565m from a budget of US$2.79bn.

Under the traditional budget formula, 6% of current budget income has to go the judicial system and another 6% has to go to municipalities. A further 6% of the current income has to go on restoring the deficit in the public pension system. The government also has to pay for the elections next March. The cost of the elections is likely to be US$12.2m. The transfers to the municipalities may have to rise: the supreme court has yet to decide whether the 6% transfer should in fact be 8%.  

These four items of expenditure all have to be financed by the Fondo General de la Nación. This means that they cannot draw on the proceeds of foreign debt issues. One of the steepest increases envisaged for 2004 is in the administration of justice. The cost of this is budgeted to rise by 22%, to US$137m. Municipalities will also get a decent real increase in their federal transfers, albeit 8%, to US$114m.  

The biggest winner, however, is the pension system: the government is budgeting to increase payments to the system by a thumping 45%, to US$301m.  

Overall, the government is budgeting on spending US$2.79bn. Of this 91%, (US$2.5bn) will be financed through the general fund. Another 7% will be financed through foreign borrowing, and the remaining 2% will be financed through aid donations.  

The government is reckoning on US$1.9bn in current income in 2004. Of this US$1.88bn will come from tax revenues and US$80m from non-tax revenues. The big foreign borrowers will be the education ministry (where US$39m of its expected spending of US$464m will come from foreign loans); the health ministry (US$13m of US$251m) and the public works ministry (US$92m of US$221m).  

América Movil buys out France Telecom
América Movil, the Mexican-based mobile telecoms company that was spun out of Teléfonos de México, announced that it would buy a majority of the country's fixed link telephone company. It is paying France Telecom US$417m for a 51% stake in the Compañí­a de Telecomunicaciones de El Salvador (CTES). The CTES has about 623,000 subscribers and dominates the local market, with a 95% share. It also has 152,000 mobile phone subscribers.

France Telecom took control of CTES five years ago when the company was privatised. Ironically, its bid of US$275m then beat Telmex. The government still owns 43% of CTES and employees have a 6% stake.  

• The country bowed to pressure from the US and withdrew from the G-21. This is the group of emerging market countries, led by Brazil, India and China, which argued that tariff reform should be a two-way street. They say that they will only lower their tariffs on condition that the industrialised countries open up their markets to agricultural products from emerging market countries and end export subsidies for their farmers. El Salvador felt that its relationship with the US was being compromised by the G21's tough line.  
  

Holders of Argentina's defaulted bonds are still not happy with the improved terms of the government's debt offer. The government needs to demonstrate that it is making progress on the debt to appease the IMF. It needs IMF support to continue rolling over its debt to that organisation.

Bondholders calculate that more pressure can be brought to bear on the government. In particular they want the government to shorten the maturity of some of the repayment: bits of the debt, principally the past-due-interest (PDI; ie the interest which should have been paid to bondholders since the end of 2001) will not be repaid for 42 years. The government had made great play in May of saying that it had taken investors' concerns about PDI into consideration. The government infuriated several groups of bondholders by saying that unless more than 70% of the debt holders accepted its offer, the amount of PDI included in the deal would be cut. There is a total of US$22.5bn in PDI: the government said that if the 70% threshold was not reached only the PDI up until the end of 2003 (US$18.5bn) would be included. It is not clear what will happen to the interest due to have been paid in 2004, but it looks as though the Argentines will try to avoid paying any of it.

The problem the government faces is that the economy is recovering quite strongly. This encourages foreign creditors to believe that the government should devote more of the growing fiscal surplus to repaying them rather than going on public works projects. This is the line the IMF, pressed by the US, is beginning to take. As the big investors have written down their Argentine holdings to zero, or close to zero, a significant improvement in terms (say 10 percentage points) would probably be enough to tip the balance. The risk for the government of President Néstor Kirchner is that such an improvement would expose a political flank. Falling out with the IMF would probably prove to be even more costly, even in domestic political terms.

The emerging-economy debt market is likely to have had its worst quarter since 2002 in the second quarter of 2004. The main reason for the decline has been the rise in yields on US Treasuries, as the market adjusts to the prospect of higher US interest rates. Higher US rates mean that investors will be less tempted to take risks by buying emerging-market debt in return for higher yields. In the second quarter of 2004, emerging-market debt fell by 5.5%. This was the worst performance among most major fixed-income markets. The second quarter performance ended a run of seven consecutive quarters of successive gains.

The government was clearly disappointed by the central bank's decision to increase interest rates, for the eighth consecutive month, on 20 April. A well-informed article in Folha de São Paulo on 21 April reported that the government was surprised by yet another increase in the basic interest rate (Selic).

The 20 April decision by the central bank's monetary committee (Copom) took the benchmark Selic rate up by 0.25% to 19.5%. This was the eighth consecutive increase. Since September 2004, the Selic has increased by 3.5 percentage points, making Brazil's interest rates the highest, in real terms, in the world. Real interest rates in Brazil are at 13.2%, the highest charge in the world. They are three times Mexico's real interest rate and four times Chile's.  

Like most independent economists and businessmen, Folha reported that the government was expecting and hoping Copom to, at worst, hold rates. Folha's sources in the Planalto Palace said President Lula da Silva was "disappointed" by the increase. The government's economic ministers also disagree with the move, though they have yet to comment publicly on the increase. According to the article, the government hid its dissatisfaction in order not to undermine the central bank's credibility and to show that the bank's decisions are taken independently from the government.

Most independent economists reckon that as the most recent increase was only 0.25% instead of the 0.5% of the previous six months, this might be the last increase in the current series. The Copom, however, was clear in its announcement that it will raise the basic interest-rate again if inflation rises.

Inflation
This is the problem. Copom's decision surprised most economic analysts, who believed that the minutes of Copom's last meeting in March had indicated that the committee was tilting against raising interest rates further. In those minutes, the central bank seemed optimistic that the Brazilian economy was not at risk of overheating and that inflation was under control. The official inflation rate, the Ipca, in March was 0.61%. In the previous month, the Ibge registered an increase of 0.59%. Although the Ipca has stabilised in the last three months, the rate for the first quarter was 1.79%. Over the past 12 months, the Ipca has risen by 7.54%.

Once again, price rises in the public sector were to blame for the rise in the Ipca. In March public sector charges increased by 1.29%, almost four times more than the 0.33% registered in February. The readjustment of bus fares in São Paulo and Porto Alegre, and the increase in charges for water and sewage in several other urban areas, were responsible for a quarter of the Ipca's rise. In April more readjustments are scheduled, notably in the price of energy and telephone services.

The Ipca's (marginal) increase followed other inflation indicators. The general prices index, measured by the Fundação Getúlio Vargas, more than doubled in March, reaching 0.99%, the highest level since August last year.  

These indicators should have shaken economists' confidence that Copom would hold fire, but in the run-up to the meeting the majority of economists opined that Copom would, at the worst, hold rates. The IPC inflation index, which measures inflation in the metropolitan region of São Paulo, increased from 0.98% to 1% in the space of a week, while the IPC-S, which measures weekly price changes nationally, increased from 0.86% in the first week of April to 0.9% in the week before the Copom meeting. The IGP-M, another national inflation index, increased from 0.55% in mid March to 0.82% in mid April.

Even the president of the Brazilian central bank, Henrique Meirelles, speaking on 18 April, just before the Copom went into its conclave, steered the markets towards the expectation that there would be no further interest rate rises. Speaking in New York, Meirelles argued that the seven consecutive basic interest-rate (Selic) increases since September had worked in the fight against inflation.  

Meirelles defended the central bank's policy of using high interest rates to squeeze out inflation, despite the criticism from business, trade unions and politicians. Meirelles, argued that the Copom's policy has been a "success", pointing to the fact that official inflation rates have fallen from 12.5% in 2002, to 9.3% in 2003 and 7.6% last year. The central bank expects inflation to fall further in 2005. According to the central bank's weekly survey of financial institutions' forecasts, published on 18 April, inflation in 2005 will be 6.1%, well above the central bank's 5.1% target. This is the highest forecast since the central bank started tightening monetary policy in September.  

Industry response
Industrialists bewailed the Copom decision. Businessmen argue that the central bank is chasing the wrong hare. They argue that the main cause of inflation is not excessive domestic demand but the government's decisions to keep on raising the price of utilities, such as electricity, and fuel.

Paulo Skaf, president of the São Paulo Industries' Federation (Fiesp), pointed out that according to the International Monetary Fund the global economy will grow 19% in average during the 2003-2006 period, with emerging economies growing at a staggering 28.52% on the period. Brazil, however, is expected to grow by only 13.48%. Skaf blames high interest-rates for the Brazilian under-performance.

Trade unions joined in the criticism, saying that high interest rates are crushing workers' purchasing power. According to the National Finances and Business Management Association (Anafac), the new Selic increase will bring the average interest-rate charged to consumers to 140.05% annually. Even orthodox monetarists were scratching their heads over the latest, quarter point increase: their models show that the 0.25% rise will have a minimal effect on curbing inflation.

Higher interest rates pose a problem for the government's finances since so much public debt has been issued at floating interest rates. In the first quarter of the year the public debt increased by almost 8% in the first quarter of the year. According to numbers from the national treasury, the public debt stands at R$873.61bn (US$335.24bn). In March alone, the government's debt increased by R$28.22bn (US$10.85bn), half of that amount due to interest-rate increase.  

Meirelles: Meanwhile in Brasí­lia, the supreme court scheduled for 5 May its ruling on two claims brought by opposition parties against the constitutionality of President Lula da Silva's August decree promoting Meirelles to ministerial rank. Lula took this step in order to shield Meirelles from further allegations of wrongdoings after they surfaced in the press. Meirelles is currently being investigated by the Public Prosecutor's Office over the allegations. The Prosecutor General, Cláudio Fonteles, is awaiting the ruling over whether Meirelles' banking confidentiality can be legally breached. Meirelles refused to comment on whether the investigations were having a negative effect on the Brazilian economy.  

IMF praises reforms but worries about rates

On 13 April the International Monetary Fund (IMF) published its revision to the World Economic Outlook to coincide with the Fund's Spring meetings. The Fund was broadly complimentary about economic policy in Brazil. The IMF's chief economist, Raghuram Rajan, said that economy has performed well in the past year, thanks to good fiscal and monetary policies. The challenge for 2005, however, will be keeping a balance, he said, "between how much fiscal tightening there is and how much monetary tightening there is". The Fund forecasts that the Brazilian economy will continue to grow in 2005, even if at a lower rate of 3.7%, in comparison with the 5.1% growth registered last year. The IMF's most recent growth forecast, however, is higher than the 3.5% estimated in the previous report six months ago. Even with positive economic results ahead, the Fund predicts that the Brazilian economy will grow by less than the global average of 4.3%. Crucially, the Brazilian forecast is below the Latin American average of 4.1%. The report praised the Brazilian government's efforts to achieve a primary budget surplus of 4.6% of GDP in 2004, yet it stressed the necessity to "continue to reduce public debt". According to the IMF, Brazil continues to be "vulnerable" to external shocks because of the country's high deficit levels. The IMF's report forecasts that inflation this year will reach 6.5%, well above the central bank's 5.1% target.

The exchange rate: The US dollar fell through the R$2.60 floor at the beginning of April, alarming exporters. At least 23 different businesses' associations launched a manifesto in the offices of the São Paulo's Industries' Federation (Fiesp) criticising the government's "passivity in face of the over-valuation of the Real". According to the manifesto, the Real's strength in relation to the dollar "threatens to stop the exporting sector's impetus". Exporters complained that the current rate not only undermines the competitiveness of Brazilian products abroad, but also helps imports, notably from Asia. According to the manifesto, sectors that do not need imported technology or artefacts, such as the clothing and footwear industries, are suffering most from the Real's appreciation. Roberto Gianetti da Fonseca, one of Fiesp's directors, noted that these are exactly the industries which employ most people. The manifesto follows a recent survey from the Fundação Getúlio Vargas (FGV) which shows businesses are much less optimistic than they were a year ago. According to the FGV's figures, the number of businessmen with a positive outlook fell from 62% in April last year to 47% in April 2005.  

Stats: According to the official Ibge figures, Brazil's GDP reached R$1.769 trillion (US$655bn) in 2004. This represents growth of 5.2% on 2003. According to the Ibge's calculations, predicated on an estimated population of 181.586 million people, GDP per head reached R$9.743 (US$3,608) last year. Discounting inflation, the result is 3.7% higher than in comparison with 2003.

The level of investment last year was equivalent to 19.6% of GDP, a significant increase when compared with the 17.8% in 2003. This is the highest level of investment since 1998, when it was 19.7% of GDP. For analysts, however, the rate is still not enough to guarantee sustainable growth. The industrial and agricultural sectors increased as a percentage of GDP last year, corresponding to 38.9% and 10.1% respectively. The services sector, on the other hand, shrank 1% in 2004, to 55.7%. According to GRC Visão consultancy firm, the economic results of last year raised Brazil's standing in the ranks of global economies to twelfth place. In 2003 Brazil was fifteenth.

The opposition-controlled congress is refusing to approve the RD$238bn (US$7.7bn) budget for 2006. The dominant party in congress, the Partido Revolucionario Dominicano wants the government to end the foreign exchange commission it charges on imports.

The executive called on congress to meet in the second week on January, but by the middle of the month congress had yet to convene. The PRD claims that the budget does not have a coherent economic development strategy. In particular it objects to the 13% commission the Dirección General de Aduanas levies on imports and, separately, the government's plan to build a metro in the capital, Santo Domingo.

What is undeniable is that custom receipts (from the DGA) surged in 2005. They rose by 31% to RD$58.1bn (US$1.7bn). In 2004 the DGA collected RD$43bn (US$1.26bn). The IMF had expected the DGA to collect RD$49.2bn in 2005.

The government says that the PRD's objections are simply political. It points out that the IMF has given its approval to the budget. The IMF signed a standby credit with the country in January 2005.

The PRD is clearly hoping to capitalise on the unpopularity of the government's increase in taxes on 200 staple goods (ranging from fish to toothpaste) under the Impuesto sobre la Transferencias de Bienes Industrializados y Servicios. This tax increased the price of products by 16% from 1 January.

Electricity charges also went up by 9% from 1 January, under a deal agreed with the IMF. As part of the deal, the World Bank is lending US$150m to improve the electricity industry.

Inflation: The rate for 2005 was 7.4%, well below the 28.8% recorded in 2004. The central bank noted that inflation had been pepped up by high oil prices. In August, September and October the monthly inflation rates were all over 1%. The IMF set an inflation target for 2005 of between 6% and 8%.

Exchange rate: The fall in the peso at the beginning of January alarmed some economists. The peso dropped from RD$30 to the dollar to RD$35.5.

The government floated the idea, at the end of September, of selling debt in Asia. This is a development of the current programme under which the government sells debt to Venezuela. Since Argentina defaulted on its foreign debt in 2001, Venezuela has been the only international buyer of its paper.  

Argentine officials said that they were looking at selling debt to China, South Korea or Malaysia. One issue the Argentine government will have to deal with is existing creditors who did not take part in the 2005 exchange offer that paid creditors just 30% of what they were owed. These creditors may use the court to seize any interest payments Argentina makes on new debt. Sales of debt to the Venezuelan government do not provide creditors with an opportunity to interfere. So far this year Venezuela has bought about US$3.4bn of Argentine debt.  

Bolivia: President Evo Morales of Bolivia said that his country's foreign debt, at US$3.6bn, or about 20% of GDP, was not payable. What Morales wants is to become eligible for the IMF's debt forgiveness programme. Honduras, Nicaragua, Guyana and Haiti have already qualified for the Highly Indebted Poor Countries (HIPC) debt relief programme.

The state-owned oil monopoly Petróleos Mexicanos announced on 25 July that it would run out of oil in seven years. This year the country's two main oil fields Cantarell and Koo-Maloob-Zaap, which produce 60% of the country's total oil, will pump out an average of 2.048m bpd, which amounts to roughly US$110m a day at current oil prices.

The problem is that by 2013, when these two fields are virtually exhausted, Pemex predicts that its total oil production will be down to 1.3m bpd. Nobody has any idea what oil prices will be in 2013, but if they are around current levels Pemex's income will be under US$45m a day. As roughly half Pemex's income is swiped by the government, the taxpayer will have to find at least another US$7bn a year, by 2013, just to maintain current levels of spending.

The problem for Pemex is that while Koo-Maloob-Zaap is compensating for the down-turn in Cantarell's production, no other major oilfields look like they are revealing themselves. The company's great hope is that there is a major undiscovered field lurking in the deep waters of the Gulf of Mexico. Thirty-five years ago oil analysts were asking more or less the same questions about how Pemex would replace it's onshore oil fields, which were in steep decline: Pemex then found Cantarell.

The run-down in oil reserves is, however, much faster than analysts expected. It is also far from clear how Pemex will tap any oilfields in the deep waters of the Gulf. Pemex has neither the technology nor the financial muscle to take the huge risks of exploring in deep waters.

Pemex's plight has major implications for the government and the country. Pemex currently supplies the government with about 35% of its total income. Without Pemex's contribution, other taxes will have to rise or the Mexican state will have to be savagely pruned.

Pemex's report to the US Securities & Exchange Commission said that the company would run out of oil in seven years' time if production remained constant and the pace of new discoveries remained at its current, disappointing, level. At the end of 2006 the company had proven reserves of 8.978bn barrels. The company's annual production is 1.33bn barrels (or 3.64m bpd of crude oil and gas equivalent)..

Pemex countered that the strict SEC requirements on what constitutes proven reserves excluded 3.92bn barrels of crude oil which is proven but not developed. Even adding this will only extend production at the current rate for a further three years.

Currently Pemex is the world's fifth-biggest oil producer. According to Oil and Gas Journal, Mexico's crude oil reserves are the eighth biggest in the world.

Scandal: Pemex endured another financial scandal when a former director (chief executive) Raúl Muñoz Leos, admitted that he had agreed to give the oil-workers' union M$1.724bn (US$160m) in 2004 to avoid a strike. Muñoz, who was brought into Pemex from Dupont, a leading petrochemical company, by President Vicente Fox to instil some private-sector discipline was dismissed at the end of 2004 after running up a record for prodigality. He insisted on travelling first-class on international flights with his wife and hiring private jets for domestic trips. He also allowed at least one wife of an executive to charge her plastic surgery to Pemex.

The oil-workers union is notorious: its leader, Carlos Romero Deschamps, a former senator for the Partido Revolucionario Institucional, was heavily involved in a scandal in 2000 in which Pemex money was shuffled, via the union, to the ill-fated presidential campaign of the PRI candidate, Francisco Labastida.

Petrobras: Brazil's state-owned oil company, Petrobras, expects to replace Pemex as the world's fifth largest oil company by 2020. Petrobras's chief, José Sérgio Gabrielli, said that the company would invest US$112bn to achieve its target.

Currently, Petrobras ranks somewhere between 10 and 15th in the world, depending on the measure chosen. Gabrielli's chosen measure is oil and gas production, He expects the company to increase its output by 50% over the next eight year. His target is to raise output from 2.3m bpd in 2006 to 3.5m bpd in 2012 and 4m bpd in 2015.

Gabrielli stressed that these plans were all for organic growth. He said that the company had no plans to take over other companies to accelerate its rise up the rankings. Gabrielli was also guarded about the prospects for the construction of a gas pipeline from Venezuela to Argentina. He said that there were still a lot of issues involving the pipeline to be resolved. The pipeline is likely to cost at least US$20bn.

Ethanol: In mid-August Brazil's filed a complaint with the World Trade Organization (WTO) against US agricultural subsidies, arguing that they subsidise US ethanol production. Brazil's WTO complaint against the US could jeopardise the Brazil-US partnership to promote ethanol as an alternative source of energy worldwide.

In March the Presidents of Brazil, Lula da Silva, and the US, George W Bush, signed a series of protocols to boost ethanol production and broaden use. The US is the largest consumer and producer of ethanol. Brazil comes second but has the resources to expand production to supply ethanol globally.

The lack of a comprehensive trade liberalisation agreement in the latest WTO round prompted the Brazilian government to attack all US agricultural subsidies, including those paid to US maize producers. US ethanol is made with maize, while ethanol produced in Brazil is made from sugar cane. Specialists agree that maize ethanol is much more expensive to produce and less energy efficient than sugar cane ethanol. Some even argue that, due to the fact that maize is used to feed livestock, maize ethanol could lead to an increase in the price of food worldwide.

Significantly, specialists claim that maize ethanol is only profitable to US producers because of subsidies they receive from their government. According to Global Subsidies Initiative (GSI), the US government provides as much as US$7.3bn in subsidies to ethanol producers.

A GSI specialist told the Brazilian newspaper O Estado de São Paulo that "a large part of these subsidies comes in the form of financial aid to maize producers". The specialist added that "by contesting US agricultural subsidies as a whole, Brazil is inevitably harming US ethanol production".

On 13 June, a new Brazilian oil company, OGX Petroleo e Gas SA, founded by local billionaire Eike Batista, floated on the Bovespa, raising a staggering   R$5.87bn (US$3.58bn) in an initial public offering (IPO). The company has yet to produce a barrel of oil and has fewer than 100 employees.

Indeed, OGX has yet to drill a single well, but the IPO, one of the biggest ever on the São Paulo market, was five times oversubscribed. The deal highlights investors' intense interest in the country's oil sector. The offering also bucks a trend of slowing activity on local stock markets this year. OGX offered 5.19m shares, or 16% of outstanding stock, at the maximum allowed price (R$1,113/share). Banks have an option to buy a further 741,800 shares.

Batista, who is one of Brazil's most successful businessmen, is cashing in on the commodity boom. In 2006 he partially floated a mining company, MMX on the Bovespa before selling half of it to Anglo-American in US$5.5bn in 2007. The sale came despite the Bolivian government deciding that it did not want MMX to develop the huge iron ore deposit at Mutún. This deposit is now being developed by an Indian company, Jindal.

The new oil company began trading with a market value of about US$21.8bn, according to local analysts, making it the 12th largest publicly traded company in Brazil and the second largest oil company in the country after the state-owned oil firm Petrobras.

OGX's business model was to hire Petrobras's key staff whom Batista identified as being responsible for Petrobras's impressive recent record in finding major oil fields. These people pitched OGX's bids at the latest auction of oil exploration in concessions, even though Petrobras withdrew some of the most promising at the last minute. Even so, in November 2007 OGX, which at that point had raised US$1bn from venture capitalists and had US$300m from Batista, paid US$800m for exploration concessions in 21 blocs off the Brazilian coast.

Most of these blocs are near Petrobras' existing fields, but are not located inside the area of the giant new Tupi field announced late last year, which Petrobras estimates could hold reserves of between 40bn and 50bn barrels of oil and natural gas equivalent.

Local oil analysts estimate that OGX's 21 concessions (which have yet to be properly investigated) could hold up to 4.8bn barrels of oil. It hopes to begin drilling by the end of the year and report its first initial discoveries in 2009. Analysts say OGX fields have a good chance of yielding results quickly given their location next to the most productive Petrobras fields and the fact that Batista has hired Petrobras's former president and head of exploration.

March was clearly a horrible month for the economy. On 5 May the Banco Central de Chile reported that the economy had contracted 0.7% year-on-year in March. The main reason for the contraction was a poor performance by manufacturing and mining. More encouragingly for the government, electricity output in April was up 2% year-on-year. Despite this, industrial output in April fell 11.1% year-on-year. Some of this fall was due to the later Easter this year, but the result was much worse than independent economists expected.

The March figure for economic activity (the Imacec) was a bit better than independent analysts had expected. Their consensus was for a 1.6% contraction. The March Imacec figure is the fifth consecutive month showing a year-on-year contraction. The March figure is better than both January (minus 1.9%) and February (minus 3.9%). It may, however, have been flattered by the fact that Easter fell in March in 2008 but in April in 2009.
The statistics agency, the Instituto Nacional Estadí­sticas (INE), reported that industrial output was down by 7.1% year-on-year in March. In April, the INE reported the 11.1% decline. The April figure was the seventh consecutive month of year-on-year falls in industrial output. On the mining side, copper production was 1.1% down, year-on-year, in April.

The central bank is doing its best to rev up the economy. It has cut interest rates by 650 basis points since the start of the year.  These cuts have yet to feed through into the real economy. Unemployment is still rising. According to the Universidad de Chile, unemployment was at 12.8% in Greater Santiago in March.
The official national unemployment figure for the February-to-April three months was 9.8%. This was 2.2 percentage points higher than 12 months earlier and the highest rate for five years. It was 0.6 of a percentage point up on the previous three months, ending in March.

This Greater Santiago figure was four percentage points higher than in March 2008 and suggests that 363,900 people lost their jobs in the past year. Such a jump must raise questions about whether public support for the ruling Concertación government's economic strategy will last. What should be alarming the government is that things have got much worse since the end of 2008. Since December, the unemployment rate has jumped by 3.1 percentage points. It is now at its highest level for five years. The statisticians point out that the unemployment rate is rising because the number of jobs is falling (down 3.5% in a year), while the labour force is growing. The labour force has grown by about 1% over the past 12 months.

The construction industry is in a bad way: over the past 12 months its labour force has declined by 24%. Manufacturing employment is down by 15.6% and even employment in government and financial services (treated as one by the Universidad) fell by 4.7%.

The encouraging statistic for the government was the pick up in electricity demand in April. Demand in April was 2% higher than in April 2008. Despite this, demand for the first four months of the year is still 0.9% below the comparable period of 2008.  Nevertheless April was the second consecutive month in which electricity demand was up, year-on-year. In the first two months of 2009, electricity demand fell by 3.4%. The Comisión Nacional de Energí­a (CNE) is forecasting, however, that demand will rise by 2.1% over 2009 as a whole.

Budget: The government hjas plenty of fiscal room for manoeuvre. In the first quarter, its fiscal deficit was only US$1.046bn. or 0.7% of GDP. This is the first quarterly deficit the country has run since the third quarter of 2003. The government expects to run a deficit of just 2.9% of GDP in 2009. In the first quarter, total fiscal income fell by 37% in real terms (year-on-year). Spending was up by 21% in real terms. The main reason for the swings and roundabouts was the collapse of copper prices.

Inflation: In April inflation turned negative again after it was positive in March when it rose by 0.4%. In April the index fell by 0.2%. For the first four months of the year, the index has fallen by 0.9%. The rate for the past 12 months is 4.5% while the rate in calendar 2008 was 7.1%.

On 15 March the government announced the closure of at least 100 agricultural companies and the 'reassignment' of their 40,000 employees.
 
Authorities said that it was closing the companies because they were inefficient. The announcement appeared in the communist party newspaper, Granma, and cited a statement from Ulises Rosales del Toro, the former general who was given the job of modernising the sugar industry but presided over a collapse in sugar production. Rosales del Toro is now the minister of agriculture, a senior member of the politburo and a vice president. He made the announcement at a meeting of the Asociación Nacional de Pequeños Campesinos in the central province of Villa Clara.

This year's sugar harvest, which should peak in March and conclude in April, appears to have been another disappointment. Granma said that mills have been hit hard this year by inefficiency, a spate of breakdowns and other technical problems.   It said the breakdowns had been so severe that mills had been out of action 19% of the time. A shortage of sugar cane is another problem. Granma claimed that cane production was 11% down on the previous year.   It reported that the worst hit area was Las Tunas, a key sugar growing region.  

Non-sugar agricultural production has also failed to meet targets this year in many parts of the country. In January and February, production around the capital was 40% below target, despite a major drive by the government to put more idle land in the hands of peasant farmers.

The latest reorganisation falls under President Raúl Castro's plan to boost domestic food production in an effort to reduce the need for imported food. Currently Cuba imports 80% of its food. The government's perennial shortage of cash has been accentuated by a fall in export revenues from nickel and flattish tourism returns, meaning that it cannot afford to go on importing food at the current rate. The tourism industry held up reasonably well in 2009 despite the global economic crisis. The number of visitors rose slightly, but revenues fell 11% in annual terms. This year has got off to a poor start.   Tourist arrivals in January were down about 5% year-on-year over January 2009.

Another sign of the economic pressure was the sudden decision, announced on 13 March, to bring forward summer time. From midnight on the 13 March, clocks went forward one hour. The government said that the move was designed to save energy. Most other countries switch to summer time in the last weekend of March. Cuba put its clocks back on the last weekend of October, in common with most other countries.

On 10 January the government agreed that basic bread (pan popular) prices should be fixed at US$0.12 per loaf. This is a rise of US$0.02 per loaf, more or less what the bakers had wanted. The government had originally hoped to limit the rise to one cent. The new price came into force on 11 January. The government hopes that the price will remain fixed for the rest of 2011.

The bakers aren't happy, though they say that they will give the agreement a chance. The leaders of the Federación Nacional de Panificadores (Fenapan) argue that bread prices have to reflect the rising costs of inputs and ingredients.

Basic bread prices had been fixed at US$0.10 a loaf since mid-2008. About half the bread consumed in the country is pan popular, the rest is composed of bigger or better loaves which used to cost between US$0.12 and US$0.20 each. Presumably their prices will rise to keep the differential with pan popular. Cake prices have shot up recently because of the surge in international wheat and flour prices. Wheat now fetches about US$400 a tonne. Cakes which used to cost US$0.50 wholesale in Quito now cost anything from US$1.5 to US$3.5. Butter and sugar prices have also risen.

Bakers are also calling for the government to do more to combat smuggling of sugar and gas out of the country. They say that shortages of both products because of smuggling are pushing up prices.

Inflation: The rise in bread prices will push up inflation. In 2010 the country recorded an annual inflation rate of 3.33%, down from 4.3% in 2009. The monthly inflation rate in December was 0.51%. The Instituto Nacional de Estadí­sticas y Censos (Inec) noted that in 2010 the sub index covering food & drink rose 54.5%. The next biggest rise was in clothing and shoes, which went up 16%.

GDP growth: The central bank president, Diego Borja, forecasts that the economy will grow 5.06% in 2011. He claimed that it grew 3.6% in 2010. Borja claims that public investment and household demand will drive the economy forward and implies that the strength of oil prices will keep the balance of payments in sustainable shape. The big question mark is over Borja's forecast for inflation, which he says will be 3% in 2011.

Independent forecasters are a bit more optimistic than Borja about 2010. Analytica Securities, a stockbrokerage, reckons that GDP growth in the third quarter of 2010 was 4.2%, well above the central bank's estimate of 2.7%. Analytica notes however that Ecuador was still one of the three slowest growing economies in South America: Colombia was the second slowest with 3.6% growth in the third quarter, while Venezuela contracted by 0.4% in that period.

Analytica argues that the main reason for Ecuador's slow growth is a lack of private investment, especially in the oil sector, where the government and international oil companies played poker over the terms of new oil concessions.

The fastest growing sector of the economy is financial services, which grew 18%, year-on-year  in the third quarter of 2010. In the second quarter this sector grew 15% year-on-year.

Stockmarkets: Katiuska King, the coordinating minister for economic policy, said on 10 January that the government wants the stock markets of Quito and Guayaquil to merge into one limited liability company.  She said that the government would introduce a law in the next few months to allow investors to buy and sell the same shares on either market. Currently, King said, this cannot be done. Ecuador's move seems to be a reaction to the decision by Chile, Colombia and Peru to allow investors to trade interchangeably on all three of their markets.

The decision by the supreme court to appoint a new Consejo Nacional Electoral (CNE) has been welcomed by both the Organization of American States and the Carter Center. Both organisations were heavily involved in brokering the deal between the opposition and the government in May this year.

The OAS said that the appointment of the new CNE was an important step in allowing Venezuelans to exercise their democratic rights under the constitution. The Carter Center, which supports democracy and elections in developing countries, said that the appointment of the CNE by the supreme court was in accordance with the Venezuelan constitution. Some government supporters argue that the supreme court has usurped the role of the national assembly in picking the CNE. It seems likely that the national assembly will vote to approve the supreme court's choices. The Carter Center's Latin American director, Jennifer McCoy, is due in Caracas today to assess the progress of the accords signed in May.

The government and its supporters still argue that a referendum on whether President Hugo Chávez should continue in office is unlikely. Yesterday, Francisco Ameliach, the president of the national assembly, said that the only definite electoral date was the election of mayors and governors in July next year. The opposition hopes that the CNE will approve the bulk of the signatures it has presented, calling for a referendum on Chávez . The CNE has three months to do this. The opposition needs 2.4m valid signatures to start the referendum machinery.

The leader of the Partido Revolucionario Institucional (PRI), Roberto Madrazo, denied that the party was split over the government's proposals to reform the electricity industry. The PRI is the biggest party in congress and the government is counting on its support to get its proposal approved.

Madrazo claimed that there were no taboo issues in the party and that it was prepared to consider anything. This is at odds with what one senior prií­sta, Manuel Bartlett, now a senator, has said. He is refusing even to discuss any change to the current way the electricity industry is managed. Madrazo said that he was one of Bartlett's chums and denied that being prepared to consider change put him closer to the government position than to the PRI's.

The evidence of the tension in the PRI over the issue is clear not only from what Bartlett has been saying but also from what other prií­stas are saying. Madrazo's successor as governor of the oil-rich state of Tabasco, Manuel Andrade, admitted that the party was split. He also pointed out that the last party conference had passed motions which committed the party to opposing any change to the constitutional arrangements for the electricity industry. Andrade also admitted that the country needed to make changes to develop new sources of generation and distribution. He said that the electricity system needed to be more reliable and more competitive.

Argentina's justice minister Gustavo Beliz will fly to Switzerland on Sunday to investigate the bank accounts of former president Carlos Menem. The aim is to uncover just how much money Menem siphoned off from Argentina during his time in charge from a variety of activities.

During his visit, Beliz will meet members of the Swiss government to discuss how to go ahead with an investigation into bank accounts held in the name of Menem and his former private secretary Ramón Hernández. The Swiss judiciary has already frozen two accounts, thought to contain some US$6.65m, but the Argentine government believes there are more, held in a variety of different names.

President Néstor Kirchner is apparently set on recovering the money, which is thought to have come from a number of criminal activities such as money laundering, arms sales, and official corruption. The two countries are also believed to be investigating the possibility that Menem might have received funds following in the 1994 bombing of the AMIA Jewish mutual association.

A former Iranian intelligence officer testified earlier this week that he had been told by his interior minister that Menem had sent an envoy to Teheran asking for US$10m in return for his not accusing Iran of carrying out the attack, in which 85 people died. Abolghasem Meshabi, otherwise known as 'Witness C', denied ever meeting the envoy and said he had no idea whether or not a payment was actually made.

Meshabi also declared on 6 November that Iran carried out the car-bombing without any external assistance. He dismissed suggestions of a so-called 'local connection' implicating Argentine police authorities of involvement. Buenos Aires police have been accused of obtaining the mini-van used in the attack, but Meshabi said that this was done by former cultural attaché at the Iranian embassy, Moshen Rabbani. Rabbani said that Meshabi was the chief planner behind the attack, but that he was the Buenos Aires representative of the militant Islamic group Hizbollah.

Paraguay's President Nicanor Duarte scored the first major success of his time in office when two supreme court judges were thrown off the court and another resigned.

The Paraguayan senate was almost unanimous in its decision on 12 December that the president of the court, Bonifacio Rí­os, and Supreme Court Justice Carlos Fernández were guilty of corruption and abuse of power. The verdict requires the immediate removal from the court of those successfully impeached. Shortly before the senate announced its decision Luis Lezcano, another judge facing impeachment, resigned, although he maintained his innocence.

Duarte took office on 15 August this year vowing to tackle Paraguay's endemic corruption; in his opinion the supreme court epitomised the crisis. Four months on, he has forced out six members of the nine-man court. Prior to the events of 12 December, three supreme court judges - Raúl Sapena, Jerónimo Irala, and Felipe Santiago Paredes - had already stepped down rather than face impeachment. Duarte now faces the challenge of building an almost entirely new court as quickly as possible in order to minimise disruption to the legal system. The new court faces a busy time if Duarte continues his success in challenging powerful political institutions.

The President has, therefore, already come good on a major promise, which should bolster his confidence as he tries to establish himself in power. The fact that he secured cross-party support for his campaign against the supreme court is encouraging, although it is unlikely he will enjoy such backing on many other issues.

Brazil's financial markets took a knock yesterday after the central bank revealed that it was extremely worried about inflation. The revelation came in the minutes of last week's meeting of the Comitê de Polí­tica Monetária (Copom). The nine-person board voted 8:1 to hold rates at 16.5% last week. The minutes showed that Copom was unlikely to cut rates in February. 

The reaction in the markets was explicit. The stockmarket fell by 6.14%; the most heavily trade Brazilian bond, the C bond, fell by 1.19%, and the country risk premium jumped by 6.5%, from 419 basis points over US treasuries to 474. The Real also weakened to R$2.93 against the dollar. 

The central bank president, Henrique Meirelles, stressed that the minutes gave a good insight into the bank's thinking, and he recommended that people should read them. He said that they were self-explanatory. He also underlined that the bank's views had changed by suggesting that people should compare what was said in January with what had been said in December. 

What stands out in the contrast is how the January minutes are suffused with worries about inflation. This goes right against the government's line, reiterated yesterday by Antônio Palocci, the finance minister, that the apparent pick-up in prices was just a temporary economic phase. 
Several independent economists agreed that the tone of the minutes was completely different from that for the minutes of the previous meeting. In September last year, when there was some evidence that inflation might have been rekindling, the central bank took only a passing interest: it noted the risks but kept on cutting rates.

The January minutes noted that there was evidence to suggest that the rise in prices in December and the first part of this year was only seasonal, but there was also evidence that these rises were knocking on right through the economy and affecting relative prices. The implications of this statement are that inflation now may have the momentum to keep on moving right across the economy. 

This conclusion seems reasonable. Yesterday another of the inflation indices for January was published, this time by the Fundação Getúlio Vargas (FGV). It found that wholesale prices had risen by 0.8% in January, compared with 0.4% in December. The biggest price rises were in food and steel. The FGV argued, however, that there was little sign of the pick-up in steel prices leading to higher prices further down the supply chain. 

The minutes concluded that, although the evidence from December was inconclusive and what has happened in January and the prospects for February are cloudy, the balance of evidence suggested that inflation was in danger of becoming persistent. The minutes noted that a poll of business intentions found that 43% of the companies polled expected to increase prices in the first quarter of the year.

Copom hinted that it would wait for a couple of months (ie, until its March meeting) before reaching a final conclusion. The news that Copom will not resume cutting interest rates in February will annoy business and the unions. Industry is picking up (industrial output in São Paulo was up by 4.4% month-on month in December), but the central bank points out that, according to the November statistics, domestic consumption is outstripping industrial output.

Senator Enrique Jackson, the leader of the Partido Revolucionario Institucional in the senate, said that the country risked sliding into ungovernability because of the failure of various state governments and parties to punish crooks. Jackson clearly means the Mexico City government of Andrés Manuel López Obrador, which last week first lost its finance minister and then the leader of the majority party in congress, both on corruption allegations.

Neither of the two officials accused, Gustavo Ponce, the finance chief who was filmed gambling in Las Vegas, and René Bejarano, the politician who was filmed in compromising conversations with a developer, have been arrested. Indeed, Ponce seems to have gone on the run. The previous week there was a scandal involving the president of the Partido Verde Ecologista de México.

Jackson argues that if people do not see politicians being punished for corruption they will assume that all politicians are corrupt. This will mean, he said, that they will lose confidence in democratic institutions.