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Development: Marí­a Consuelo Araújo quit as foreign minister on 19 February. She has been replaced by Fernando Araújo Perdomo, a former minister who recently escaped from the Fuerzas Armadas Revolucionarias de Colombia (Farc) after being held captive for over six years. 

Significance: Araújo is the first member of President Alvaro Uribe's administration to be brought down by the parapolitical scandal. Her brother, Senator Alvaro Araújo, was arrested on 15 February for his links to the Autodefensas Unidas de Colombia (AUC). The very next day the supreme court ordered an investigation into her father, Alvaro Araújo Noguera, for his connections to the paramilitaries.

Uribe fought hard to keep Araújo in office, arguing that she had nothing to do with the alleged crimes of her family. However, a number of ministers within Uribe's administration believed her position was untenable following the arrest of her brother. Among them was the defence minister, Juan Manuel Santos, who reportedly told Uribe that it would complicate Colombia's relations with the EU and its already-faltering free-trade negotiations with the US were Araújo to remain foreign minister.

Having accepted Marí­a Consuelo Araújo's resignation, Uribe wasted no time in appointing Fernando Araújo Perdomo (no relation) to be her successor. Araújo Perdomo was a surprise choice: he does not belong to Uribe's administration, and it is barely six weeks since he escaped from his long capture by the Farc.

Araújo Perdomo does possess ministerial experience: he was serving as development minister for Andrés Pastrana (president from 1998-2002) at the time of his capture. However, Uribe has been highly critical of Pastrana's government for its decision to grant an enormous demilitarised zone to the Farc during an abortive peace process. Uribe has complained that his administration has had to suffer the consequences of Pastrana's government and recently said that his predecessor should account for his actions in a public hearing.

His escape from the Farc has made Araújo Perdomo one of the men of the moment, and Uribe's decision to appoint him as foreign minister appears to be a very populist move. However, it is not without pragmatism: Araújo Perdomo will be well received in Europe, which enjoyed good relations with the Pastrana government and which is particularly interested in the hostage issue.

He will also be welcome in the US, which agreed on the crucial military aid programme, Plan Colombia, with Pastrana in 2000. Araújo Perdomo's presence might also play a key role in Uribe's plans to secure US funding for a Plan Colombia II.

Araújo Perdomo was confident about representing Colombia on the world stage. “I believe that having been kidnapped for six years grants me the moral authority to ask the world to join us in our crusade," the new foreign minister declared. Uribe said that Araújo Perdomo had suffered first hand the “national tragedy".

On 18 March, the 69th anniversary of the nationalisation of the country's oil industry, President Felipe Calderón Hinojosa announced that the country's oil reserves would last for less than 10 years at the current rate of production. The rapid dwindling of the country's oil reserves and falling production has major implications for the government which gets almost 40% of its revenues from oil.

Calderón wants to frighten congressmen and commentators. As oil revenues fall, along with production, the government will have to increase taxes either on other activities or, more likely, on people. This is why fiscal reform is so urgent. The Calderón government hopes to have a proposal drafted and ready for discussion in congress by August this year. Calderón and his government want congress to understand that unless it does something soon, the country will run into serious economic and political problems.

Previous governments have tended to assume that a reform of taxation would be accompanied by a reform of energy policy to encourage foreign investment in the oil industry and delay the inevitable decline of oil revenues. Calderón, however, appears to have ruled out any major relaxation of the state's control of the oil industry during his administration. He said, unequivocally, during President George W Bush's visit from 12 to 14 March, that the oil industry would remain a state monopoly and that he and President Bush had not even discussed the opening up of the Mexican oil industry to international energy companies. 

So it was significant that Cuauhtémoc Cárdenas, the founder of the leftwing Partido de la Revolución Democrática (PRD), suggested, also on 18 March, that the private sector should be allowed a greater role in the oil industry. Rightwingers who used to disparage him now see Cárdenas as the voice of the reasonable left. The radical left is led by Andrés Manuel López Obrador, who came a close second to Calderón in the presidential elections in July 2006. López Obrador is adamantly opposed to any dilution of the state's control of the oil industry. The oil industry was nationalised by Cárdenas's father, President Lázaro Cárdenas, in 1938. Cárdenas's mother, famously, set an example to other Mexican ladies by donating her jewellery to the government so that it could pay compensation to the international oil companies whose operations her husband had nationalised. 

What Cuauhtémoc Cárdenas suggested was allowing more private sector involvement in some areas of the oil industry to keep production levels up. Cárdenas claimed that such private sector investment was permitted under the current legislation. The current legislation allows the state oil company, Petróleos Mexicanos, to hire foreign subcontrators provided they are paid only in cash and have no equity interest in the projects they develop. This provision has been developed into a whole off-balance sheet business known as Pidiregas. Cárdenas argued that foreign capital would be interested in developing oil projects in Mexico, provided Pemex was able to act freely and professionally.

Cárdenas argued that Pemex was no longer doing what it had been intended to do: manage the development of the oil industry in a strategically sensible way. What he said was that Pemex needed to be made answerable to an agency that set the country's long term energy strategy. What has happened, though he did not say it, is that too many governments have used Pemex as a cash cow to reward powerful lobbies or their supporters. It is worth noting that 58% of public spending in Mexico now goes on paying wages and pensions for government employees.

Development: Brazil's President, Lula da Silva, met his Argentine counterpart, Néstor Kirchner, in Buenos Aires on 27 April after visiting the Chilean President, Michelle Bachelet, the previous day.

Significance: Lula's tour was an attempt from the Brazilian government to reinforce the so-called "ABC partnership" between Argentina, Brazil and Chile, which was behind the beginnings of South American integration in the 1990s. Lula's reception in Buenos Aires, however, was not was friendly as that in Santiago.

The Chilean government seemed much more receptive to Brazil's "biofuel diplomacy", than Argentina. Lula admitted that Brazil and Argentina "have problems" that cannot be resolved simply by boosting cooperation on biofuel production. Trade frictions within the Mercosur, the customs union to which both countries are original members, have damaged relations between the two members which have traditionally been rivals.

The private meeting between Lula and Kirchner took place at the Olivos residence. Although official declarations maintained the atmosphere was of "very good spirits" it is clear the differences have not been resolved. According to the Argentine planning minister, Brazil and Argentina has each "its own [energy] project". The main topic of contention, however, seems to be the regional development bank proposed by Venezuela, the Banco del Sur. The Brazilian government is not keen on the idea but the Argentines are. Lula set his opposition clearly when he said that the bank's objectives "must be defined correctly".

As a gesture of goodwill the Brazilian government offered an icebreaker  to the Argentine government for its Antarctic resupply operation in December. Argentina lost its only icebreaker, Almirante Rangel earlier this month. The British government has also offered an icebreaker but the Argentine government rejected this offer but accepted the Brazilian vessel.

Development: The US Trade Representative said on 4 June that the US Congress would approve a trade deal with Peru by August.

Significance: The claim, by Susan Schwab, the Trade Representative, is the clearest indication yet that Peru and Panama, but almost certainly not Colombia, will get free trade deals with the US this year. Schwab said that Congress was still worried about the violence in Colombia, though she said that it was important for the US “not to disappoint" a government that was making a difference.

Schwab said that she expected the Panama deal to be signed this month.

Development: By midnight tomorrow (10 July) all candidacy paperwork for the upcoming September presidential and congressional elections must be turned in to the Registry of Citizens.

Significance: According to the Registry of Citizens, six presidential candidates have been confirmed, five are waiting confirmation, and three have not submitted any paperwork.

Some parties will manipulate the deadline by turning in paperwork at the last minute. Currently, 16 of 21 political groups can participate in the September elections.

If the eight presidential candidates awaiting confirmation are not passed by tomorrow, Guatemalans will see a shorter presidential ballot compared to 2003. In 2003, 11 candidates, each from different parties, stood for the presidency.

Development: US legislators claimed on 8 August that the US was close to agreeing a major anti-drugs package with Mexico.

Significance: The news, which followed two earlier leaks in the past week of progress on an anti-drugs deal, came the day after Mexico indicated that it was about to restart diplomatic relations with Venezuela. This rapprochement underlined the new direction of Mexican foreign policy under President Felipe Calderón Hinojosa. Calderón's foreign policy is cooler about relations with the US and keener on rebuilding Mexico's links with Latin America than that of his predecessor, Vicente Fox.

The Mexican government did not comment on the latest story of the aid package, in the US newspaper the Washington Post, and the US State Department's steer on the issue, in its daily press briefing, was that any agreement was still some way off.

The US stories, which quote US legislators, claim that the US government will provide the Mexican government with considerable amounts of cash to boost its anti-drugs efforts as well as high tech hardware to improve the Mexican authorities' intelligence gathering.

The spin from the US is that the deal will be discussed at the forthcoming Nafta summit in Quebec on 20 August, when the presidents of the US and Mexico and the prime minister of Canada are scheduled to meet. It is not clear whether the US hopes to start the package in the current financial year or the next.

The US legislators pushing for the Mexican aid package come mostly from Texas. Representative Henry Cuellar (D, Texas), told the Washington Post that the US would have to invest large amounts of money to fight the drug problem in Mexico.

The US claims, according to unnamed officials, that the new package represents what one called "a sea change" in US-Mexico relations; that the US had recognised that Calderón had a major problem with combating the drug trade and his efforts -whether he succeeded or failed- would have major consequences for the US.

The problem with this view is that the US proponents of the policy of providing more anti-drugs help for Mexico do not seem to understand what is occurring in Mexico and the policy debate there.

The Calderón government has been using the army, since it took office last December, to fight the drug trade. The results of this initiative have been mixed. The death toll shot up in the first half of the year as a result, but fell back in June and July. The worry for the government is that the violence seems to be picking up again. Earlier this week two policemen were killed in an ambush in Xalapa, the capital of Veracruz, one of the 10 states in which the army is deployed. On 8 August another two people were gunned down in Guadalajara and a third killed in Monterrey. Gangsters were apparently responsible for all these killings.

The Calderón government has come under pressure from human rights' activists to withdraw the army. This is because soldiers are not trained to act as policemen and the likelihood of human rights abuses will increase the longer the army remains in the field. So far there have been three major incidents. The first was -the rape and murder of an indigenous woman Ernestina Ascenscio, allegedly by soldiers, at the end of February- was not pursued. Human rights activists have, however, persuaded the military to investigate soldiers' alleged rape of a group of girls in Michoacán and why soldiers opened fire on a car, killing two women and three children, when it failed to stop at a checkpoint in Sinaloa.

Across Latin America, the US has always favoured using the national army to fight drug gangs. This policy is already under criticism in Mexico and could become untenable for the Calderón government if the US was seen to be endorsing it.

Development: The ailing Cuban leader, Fidel Castro, claimed on 12 September that the Cuban government passed on information to US authorities in 1984 that "saved the life" of former US president, Ronald Reagan.

Significance: The information, which was revealed in another one of Fidel's essays published by the communist mouthpiece Granma, seems to have been tailored to show that Havana had collaborated with Washington in the past. Fidel handed over day-to-day power to his younger brother, Raúl, last year because of his fragile health. Contrary to ideologically-motivated Fidel, Raúl has taken a more pragmatic stance in the political and economic affairs of the island, and that, it seems, may include improving relations with the US.

According to Fidel a Cuban diplomat to the UN passed on information to US authorities of an extreme right wing group's plan to assassinate Reagan during a trip to North Carolina. Fidel said that "the information was complete; we gave them names, the day, the time and place" relating to the alleged assassination attempt. Fidel did not say how the Cuban government had obtained the information. The FBI's chief in North Carolina, Newsom Summerlin, declared he had "no information" regarding Fidel's revelation.

Development: On 14 October the Organization of American States (OAS) called for a "non-aggression" pact in the forthcoming elections.

Significance: The presidential elections, due on 4 November, have degenerated into a mud-slinging match. Both candidates, Otto Pérez Molina from the rightwing Partido Patriota and Alvaro Colom, from the Unidad Nacional de la Esperanza, accuse the other of being in league with gangsters.

The call for a non-aggression pact came from Diego Garcí­a-Sayán, the head of the OAS mission to observe the elections. He pointed out that both candidates had signed a non-aggression pact, sponsored by the evangelical churches, in September. In that agreement, they agreed not to question the electoral results, not to attack each other and to run respectable campaigns.

This has not happened. No-one is clear what either candidate would do if elected, nor if they could form alliances in congress to get their proposals into law.

Development: On 13 November narco-guerrillas ambushed a police convoy killing four policemen.

Significance: The government has changed its tune. Previously ministers were quick to claim that attacks on the police were the work of remnants of the Sendero Luminoso. Now the defence minister, Allan Wagner, said that the attackers were gangsters, who perhaps had also been Senderistas. They had been flushed out of the Valle de los Rí­os Apurimac y Ene (VRAE), one of the country's main drug producing zones, by the army and the police. The ambush came only two weeks after a police station in Ocobamba, in Apurí­mac, was stormed by gangsters.

The ambush took place in Huancavelica, south east of Lima and north west of the VRAE. The police said that the two vehicle convoy was dynamited as it was returning to base in the evening after a patrol to pick up the body of a girl who had been raped and killed. Survivors said that around 30 people were involved in the attack.

The survivors said that the attacked had called on them to surrender after the first vehicle in the convoy was completely destroyed.
Locals said that the area of the attack, Huachocolpa, was barely policed and was controlled, effectively, by drug traffickers. It is one of the main routes into the VRAE

Development: On 19 December Raúl Reyes, the spokesman for the Fuerzas Armadas Revolucionarias de Colombia (Farc), said that the guerrilla group would release all its hostages if President Álvaro Uribe were to resign.

Significance: The Farc appears to have wasted the bargaining chip it earned via its decision to release three of its 45 high-profile hostages. The guerrilla group has made a demand that Uribe will never accept and that, more importantly, no-one either in Colombia or abroad would expect him to accept.

However, the timing of Reyes' announcement is significant: his demands chime with remarks made by Venezuela's President Hugo Chávez only a day before. The Farc and Chávez appear to be working in tandem to create the impression that Uribe is an obstruction to a prisoner swap. This in turn makes Uribe's position highly awkward, given the considerable international attention now being focused on the hostages.

Uribe has yet to respond to Reyes' demand. When he does so, it will not be difficult for him to portray it as further evidence of the Farc's cynical attempts to use their hostages as political collateral. The government's position is strengthened by the fact that the Farc is very unlikely to free all its captives, regardless of who is in power.

The hostages are by far the guerrilla group's biggest bargaining chip and the Farc would not hand them over until the very end of a peace process. Such a peace process is the remotest of possibilities, even if Uribe were to be replaced.

But it would be hasty to suggest that the Farc has made a major miscalculation. The guerrilla group is acutely aware of the importance of PR, and Reyes' announcement is almost certainly part of a ploy to undermine Uribe's authority.

The major beneficiary appears to be Chávez , who remains furious at Uribe for sacking him as mediator in the prisoner swap negotiations in November. Chávez still wants to be involved in the prisoner swap, and the Farc still wants him to be involved too; neither wants Uribe to be at the negotiating table.

The Venezuelan president is rubbing his hands at the prospect of the Farc releasing three of its hostages - Clara Rojas, her son Emmanuel, and former congresswoman Consuelo González de Perdomo - before Christmas. Colombian media reports that the three are already on Venezuelan soil and are ready to be handed over to Chávez or "someone of his choosing", as stipulated by the Farc.

It will be interesting to see whom Chávez chooses. He would thrive on the photographs of him receiving the hostages, not least because it would irritate Uribe no end. However, were Chávez to allow French President Nicolas Sarkozy to take the glory, then Sarkozy might be more disposed to cooperate with the Venezuelan president, rather than with the Colombian leader, in the belief that Chávez is more likely to secure the release of Ingrid Betancourt.

Development: On 30 January a deputy for the ruling Unidad Nacional de la Esperanza (UNE) told the local press that there were problems within the party.

Significance: UNE deputy Roberto Kestler admitted what many had suspected but which party members and President Álvaro Colom had sought to downplay or deny - that the party was unhappy over Colom's refusal to hand out public posts or contracts to those allied to the UNE.

Party members had also expressed discontent over the new UNE bench leader, Mario Taracena.

The situation could benefit Colom in some respects - not least through suggesting his willingness to crack down on corruption and avoid nepotism. He took the opportunity to assert that party discontent was the necessary price to pay for "doing things differently" and emphasised the need for each of the state powers to fulfil its own role.

In the short term, however, the splits and resentment could prove troublesome for the president, given the already fragmented nature of congress.

Development: Argentina's President Cristina Fernández de Kirchner is due to fly to Venezuela today (5 March).

Significance: This is a key visit for Fernández, who needs to secure assistance from Venezuela's President Hugo Chávez if her government is to avoid an energy crisis in the coming winter. Unfortunately for Fernández she could scarcely have picked a worse time to visit Caracas: Chávez is focused entirely on an ever-worsening row with Colombia.

Chávez and Fernández are scheduled to meet on 6 March, whereupon they will sign two agreements: a deal relating to food security, which will be of particular benefit to Venezuela, and another pertaining to energy security, which is of key importance to Argentina.

The two leaders are then expected to head to a summit of the Rio Group in the Dominican Republic. Organizers of the meeting expect the summit to go ahead but its agenda is likely to be dominated by the dispute between Colombia, Ecuador and Venezuela. Fernández, who believes that the energy shortages are "a regional issue" had hoped that the meeting would focus on this issue.

Development: Blanca Ovelar, presidential candidate for the ruling Partido Colorado, still faces opposition from within her party 12 days from the election on 20 April.

Significance: Ovelar broke down on 8 April as she publicly discussed how difficult the election process has been for her both personally and politically. She tearfully complained about having to deal with the "lies of the press that doesn't like the Partido Colorado".

Ovelar's breakdown came a day after she was booed and hissed at while campaigning in Seccional 12, a part of Asunción which supports Luis Castiglioni, the former vice-president. Castiglioni doesn't recognize his defeat to Ovelar in the Colorado party primary held in December, insisting he was victim of fraud.

"There are sectors that refuse to work for the Partido Colorado, above all in the interior of the country" said Ana Marí­a Castiglioni, sister of the dissenting leader. Luis Castiglioni has stressed he will not vote for Ovelar but has left his followers free to choose the candidate they want.

The Partido Colorado is afraid that these dissident votes might go to the opposition, represented by the former bishop Fernando Lugo, the retired general Lino Oviedo and the businessman Pedro Fadul.

From 5 April electoral law prevent any more opinion polls from being published except for by the daily newspaper Ultima Hora. Lugo has led in all the polls published until now. While Oviedo and Fadul appear way behind, Lugo has shown a steady advantage of at least 5 points over Blanca Ovelar.

Development: On 14 May Brazil's environment minister, Marina Silva, resigned over alleged disagreements with the government of President Lula da Silva over the direction of environment policy.  

Significance: The loss of the popular young environment minister, who had a very high international profile, is a significant blow to Lula. Silva had allegedly disagreed with elements of Lula's recently announced Sustainable Amazon Plan (PAS), which includes controversial proposals to increase road building in the Amazon. She also disagreed with plans to allow increased commercial farming in the region.

Interestingly, the president of Brazil's environmental protection agency (Ibama), Bazileu Margarido, and the president of the Chico Mendes Institute for the Conservation of Biodiversity, João Paulo Capobianco (also the executive secretary at the environment ministry), both also resigned at the same time as Silva.

Silva, a well know environmentalist (and former associate of the environmental activist Chico Mendes, killed in 1988) was appointed to much fanfare in 2002. However, her term in office was marked by a succession of run-ins with the government. She protested against plans to increase the area of the Amazon eligible to be used for farming and recently had a run-in with the ministry of agriculture over plans to loosen up a law that restricts financial credit to farmers that flout environmental licensing and property registration rules.

There were also tensions between her department and the office of Lula's chief of staff, Dilma Rouseff, over plans for new hydro infrastructure projects in the Amazon under the auspices of the government's large new development program, the Programa de Aceleração do Crescimento (PAC).

According to local press reports, the final straw for Silva was Lula's decision to assign the minister for strategic affairs, Mangabeira Unger, to coordinate the president's new Amazon Plan. Earlier this year, Unger defended the construction of a controversial aqueduct in the state of Amazonia, to the chagrin of local environmentalists.

Silva's resignation will send a signal - especially to the international community - that the Lula administration is not taking its commitment to the Amazon seriously and that commercial considerations are dictating much of its policy on the environment.

Candidates to replace Silva include the secretary for the environment in the state of Rio de Janeiro, Carlos Minc, and the former governor of Acre, Jorge Viana. Silva will resume her seat in the senate.

Development: On 18 June the four main rural associations extended their four-day strike against the government for an extra day.

Significance: The symbolism of the extension is much more important than the 24-hour extension itself. The farmers' decision indicates that the rural sector remains deeply suspicious of the government even though President Cristina Fernández de Kirchner agreed on 16 June to allow congress to decide the fate of her government's tax increase on agricultural exports.

It is little surprise that the farmers have their doubts about Fernández, whose attitude towards the farmers in increasingly schizophrenic. The president's decision to seek congress' approval for her tax reforms hinted that she was ready to compromise for the first time during the dispute with the farmers, which has lasted more than three months. However, Fernández launched a vitriolic attack on the farmers and their urban supporters during a speech to a rally in Buenos Aires on 18 June.

The rally, which attracted some 50,000 people to the Plaza de Mayo, was dominated by Fernández's husband and predecessor, Néstor Kirchner. It was Kirchner who organized the demonstration as a show of support for the government, and the majority of the crowd were affiliated either to the Partido Justicialista (the party led by Néstor Kirchner) or to unions loyal to Kirchner. It was therefore little surprise that Fernández's speech adopted the aggressive rhetoric of her husband, who more than anyone has dictated the government's response to the rural dispute.

Fernández railed against the leaders of the four main rural associations, describing them as “four people nobody voted for_who decide who can and can't use the roads". The president also criticised those who had taken part in demonstrations against the government across Argentina's major cities on 16 June, saying that their protests “don't solve anything".

The message from the president was that her government was standing up for democracy in its struggle with the farmers. She even suggested that the farmers form a political party and allow the electorate to express its support for their ambitions at democratic elections.

This is a tired message which Argentines simply do not believe. Given that both the rural and the urban population have come out overwhelmingly in support of the farmers, it is difficult to know who Fernández feels is represented by the democracy she is trying so hard to protect.

There was little evidence in Fernández's speech that she was ready to negotiate with the farmers, even though public opinion is clearly in favour of dialogue rather than the mud-slinging that currently characterises the dispute. This suggests that the president believes she has made her one and only compromise in sending the tax reforms to congress.

The government has good reason to be confident. Politicians loyal to the Kirchners are in the majority in both chambers of congress, and sources suggest that many of these legislators have already told the president that they can count on her support when congress starts debating the reforms on 23 June. The legislature will not be able to amend the reforms, but will instead only be able to decide for or against them in their current form.

Once congress approves the reforms, it will share the burden of blame for the reforms with the government. The farmers can reasonably pursue their campaign against the unpopular president and her administration but to do so against congress will be far harder to justify.

If Fernández had come up with this idea two or three months ago it would probably have worked without a hitch. However, the farmers extended their strike precisely to show that they are aware of what the government is trying to achieve and to indicate to the public that it too should be suspicious of the government.

If the reforms sail through congress without substantial debate, it is unlikely to end the dispute. This places the opposition to the government, who have united behind the farmers, in an interesting position: if the opposition (which cannot rival the strength of the pro-Kirchners legislators) make a big show of opposing the reforms it will play into the government's hands by creating the illusion of proper debate. It might well happen, therefore, that opponents of the government do not even attend the debate.

Development: On 21 July the Fuerzas Armadas Revolucionarias de Colombia (Farc) issued a statement declaring that the guerrilla group will never lay down its weapons.

Significance: The statement, which was signed by Rodrigo Granda and Jesús Santrich, is a rebuttal to calls by Presidents Hugo Chávez of Venezuela and Rafael Correa of Ecuador for the Farc to abandon its armed struggle. The statement was also release a week after the Colombian government announced that it was seeking direct contact with the Farc.

However, the defiant suggestion that the Farc would rather die in combat than give up their fight for social justice is not wholly convincing. Neither Granda nor Santrich belong to the Farc's secretariat (central committee). A week ago the secretariat signed a letter asking Daniel Ortega, the president of Nicaragua, to talk to the guerrilla group, a request Ortega has accepted, much to Colombia's fury.

On 20 July the “Miami Herald" published a story claiming that the men led by Farc's military chief, Jorge Briceño Suárez (alias Mono Jojoy), might be ready to surrender. The newspaper suggested that the Farc's 53rd Front (which Mono Jojoy leads) wants to make contact with the Colombian generals.

The security forces have pursued Mono Jojoy intensively over recent months, and it was suggested recently that he had survived an attempt against his life by members of his personal guard. The story was reminiscent of the fate of Iván Rí­os, another member of the secretariat, who was killed by his right-hand man in March.

Development: On 23 August El Salvador's national police chief, Francisco Rovira, stepped down.

Significance: Rovira's resignation follows reports published in the local media that two of his close advisers, José Pérez Aguillón and José Aquino Oliva (both former customs officials), were accused of corruption and links with drug traffickers. The scandal points to the ongoing problem of corruption in the Salvadorean police force.

According to national daily La Prensa Gráfica, both Aguillón and Aquino had been fired by the customs department for “irregularities". In the case of Aguillón, his contract was not renewed at the end of last year due to the fact that he was allegedly using his influence to benefit family and friends. He is also accused of establishing a company which has links to criminals, including a drug trafficker.

Rovira denied any knowledge of the accusations against the men and El Salvador's President Tony Saca told a news conference that “Rovira wanted an open and transparent investigation and that's why I accepted his resignation".

Saca has named deputy police chief, José Luis Tobar, as Rovira's interim replacement.

Development: On 23 September the Haitian government launched an emergency programme to deal with the devastation caused by four recent hurricanes, which left hundreds of thousands of people displaced.

Significance: The recently-confirmed prime minister, Michí¨le Duvivier Pierre-Louis, announced that the programme will draw on some US$151m from Venezuelan President Hugo Chávez 's soft-diplomacy initiative, Petrocaribe.

The challenges to Pierre-Louis remain enormous, given the extent of the damage done to infrastructure in large areas of the country, particularly in and around the northern city of Gonaí¯ves, which was the worst-affected by flooding caused by the tropical storms.

Moreover, corruption is endemic in Haiti and Pierre-Louis already admitted a few days earlier before parliament that corruption was preventing some of the aid donated in the wake of the hurricanes from getting to the people who needed it most. Haiti recently came bottom of all countries in the region in a new corruption-perception index published by an NGO, Transparency International, with only 1.4 points. The organisation said that any score lower than three indicated “levels of corruption that are out of control".

Pierre-Louis indicated that US$60m will go to the agriculture sector in an effort to boost production in the face of rising global food prices. This aid will include some 25,000t of fertiliser, 215 tractors and other equipment. In addition, some 56 schools will have to be rebuilt entirely and 593 repaired before school term starts again for the year on 6 October. The government has promised to provide school lunches to some 50,000 children and uniforms for 100,000.

PARAGUAY: President Fernando Lugo met US President George W. Bush in Washington on 27 October. Bush said after the meeting in the White House that he had been impressed by the former-bishop's “corazón grande" [big heart] and praised the “strong stand" that Lugo - who ended the 61-year hegemony of Paraguay's Partido Colorado when he came to power in August - is taking against corruption. “There's nothing more discouraging than to have the government of a people steal their money", said Bush, adding, “we [the US] stand with you". Lugo remarked that it was “a joy" to be able to reinforce Paraguay's “historic relationship" with the US.  “We have said since the very beginning that if anything were to distinguish our government, it would be international solidarity", he declared, adding that working together to eradicate poverty is more important than political alignment.

CUBA: The UN General Assembly voted on 29 October against the US economic, commercial and financial embargo on Cuba. This was the 17th year running that the 192-strong General Assembly has urged the US to end what Cuba calls the “blockade" that has been strangling its economy since 1962. This year UN delegates voted in record numbers to lift the embargo, by 185 votes in favour, three against (the US, Israel and the Pacific island state of Palau) and two abstentions (Micronesia and the Marshall Islands). Iraq and El Salvador did not vote. Cuba's Foreign Minister, Felipe Pérez Roque, pointed out that the “blockade" is older than Democrat presidential candidate Barack Obama, and added that seven out of every ten Cubans on the island have spent their entire lives living under this “irrational and useless policy".

MEXICO & BRAZIL: The US Federal Reserve decided on 29 October to make the protection of key emerging economies a priority in the current financial crisis, and announced that it will would lending the two Latin American heavyweights - Mexico and Brazil - US$30bn each, along with South Korea and Singapore. This signals the increased importance of these countries to the global economy, as well as confirming the “contagion" effect of the crisis on emerging markets. The decision by the Fed to support these key Latin American and Asian economies is largely a response to the increased demand for dollars by banks and companies outside the US. Together with the International Monetary Fund, the Fed is attempting to encourage stability in the world economy by meeting the dollar liquidity needs of these four countries.

Peru's anti-Sendero drive suffers string of setbacks

A series of government setbacks at the hand of Sendero Luminoso (SL) guerrillas in both of the areas where they continue to operate has raised questions about the security forces' renewed boasts that they were 'closing in' on the SL remnants. The succession of military and police losses contrasts with the virtual absence of reports about government successes.

This latest string of attacks has led Ricardo Soberón, a leading commentator on the antidrugs campaign, to claim that they embody the 'absolute failure' of the offensive being conducted by the army and the police. 'The Peruvian state,' wrote Soberón, 'is continuing to lose positions.'

Three separate attacks by Sendero Luminoso (SL) guerrillas in the second half of November left a toll of seven police officers killed and two soldiers and five police officers injured. Two of the attacks were carried out by fighters of the Comando Regional Principal, that operates in and around the Apurí­mac-Ene valley; the third, by a group from the Comité del Huallaga, that operates in the Upper Huallaga region under the command of 'Camarada Artemio'.

On 17 November three police officers were killed in an ambush near Luricocha, in Huanta. Two days later, two soldiers were killed in an attack on an army helicopter close to the boundary between the departments of Cusco and Ayacucho. It is in this general area that in August the military launched its Plan de Operaciones Excelencia, and where in October they suffered the greatest number of casualties in any single action in 11 years.

On 26 November a contingent of about 40 SL fighters ambushed a police convoy travelling on the highway from Tingo Marí­a, Huánuco, to Pucallpa. Four police officers were killed and five were injured. The convoy, which included members of the special operations directorate (Dinoes), the antidrugs directorate (Dinandro) and the highways police, had been despatched by the Frente Policial Huallaga, which is in charge of counterinsurgency operations in that area.

On 9 October, in the first serious engagement since the government launched on 30 August its Plan de Operaciones Excelencia, designed to rid the Apurí­mac-Ene valley of the largest surviving contingent of Sendero Luminoso (SL) guerrillas, the Peruvian army has suffered the greatest number of casualties in any single action in 11 years. A convoy carrying troops and a few civilians was ambushed on a highway near Tintaypunco, in the province of Tayacaja, Huancavelica. The attackers detonated a mine which halted the convoy, then opened fire with assault rifles. The military high command took some time to get a complete picture of the episode: it initially put the number of fatalities at 19, then reduced it to 14, then raised it against to 15.

A day before this ambush another had taken place in Vizcatán, a mountainous jungle-rim area that straddles the departments of Ayacucho and Juní­n, also in the Apurí­mac-Ene valley region (VRAE in the Spanish acronym). A laconic army communiqué reported that one soldier had been killed.

Up to that point, the Excelencia operation had resulted in the killing of five suspected SL guerrillas (but no captures) and the wounding of 24 members of the military and police. About 1,200 troops had been deployed in the area; 800 within Vizcatán and the rest encircling the area and controlling road and river accesses. The military say they have been concentrating on establishing outposts and choking off supplies to the guerrillas, in a 'siege' expected to start yielding results within a month or so. More than a month later the SL appears still able to strike and elude confrontation at will.