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CHILE | Piñera unburdens himself. The likely presidential candidate for the right-wing Alianza por Chile coalition, Sebastián Piñera, has signed a voluntary blind trust contract placing US$400m of investment in public limited companies in third party hands. Piñera said the move showed his determination to avoid any conflict of interests should he win December's elections. He made it just as the government sent a bill to congress requiring those seeking public office to place business interests in a blind trust, making sales of shares in certain companies mandatory. He said he would only remain director of Chile's most popular football team, Colo Colo, while resigning as a director on other company boards.
Piñera keeps hold of Lan Chile and Chilevisión. He said he had signed a contract guaranteeing the sale of his 26.3% stake in Lan Chile in 2010 if he is elected president, and had called on a firm of lawyers to produce a statute guaranteeing the independent editorial line and programming of Chilevisión. The presidential spokeswoman, Carolina Tohá, said that it beggared belief that a presidential aspirant could consider the ownership of a major media outlet to be “irrelevant".

ARGENTINA-BRAZIL | Trade talks. Argentina's President Cristina Fernández met her Brazilian peer Lula da Silva in Buenos Aires to discuss the fall in bilateral trade in the first quarter of the year. Two-way trade reached a record US$31bn last year, but volume halved in the first quarter, compared with a year earlier. As expected, Lula criticised “trade protectionism" without referring to Fernández's measures to boost Argentina's manufacturing sector. The measures were implemented to protect the Argentine industry from Asian competitors, but have also hurt Brazilian exports. In March, Argentina posted a small trade surplus of US$20m with Brazil, the first since June 2003. Despite Lula's speech, the Argentine government has not backed down. Talks will continue.

MEXICO | PAN party presidency. On 4 August Santiago Creel, whom President Felipe Calderón Hinojosa defeated for the presidential nomination of the Partido Acción Nacional (PAN) in 2005, refused to support César Nava for the party presidency. The election is on 8 August. To win, Nava, the only candidate, needs the support of 250 of the 370 members of the PAN Comité Ejecutivo Nacional (CEN).
    Calderón and Creel have famously poor relations. Calderón manoeuvred to get Creel dismissed as the leader of the PAN's bloc in the senate. Creel's offence is that he is open-minded and refuses to kowtow to the powerful television companies.
    Calderón is trying to ensure that Nava wins. He has been meeting other Panistas and apparently has an agreement, but he did not share this document with Creel. Creel has made it clear that he will vote against Nava before he goes on holiday. The big question is whether he can persuade another 120 CEN members to do the same.

President Felipe Calderón Hinojosa, never a natural media performer, is becoming querulous and beleaguered as his power begins to ebb. So far congress, now controlled by the opposition Partido Revolucionario Institucional (PRI), has been dismissive rather than vindictive, but this attitude may change if Calderón does not recover some political authority and momentum.

Mexico's politics are in a strange state. Calderón and his government, suddenly, seem to have lost their political nerve.The bruising defeat for Calderón's Partido Acción Nacional (PAN) in the mid-term elections in July (and the prospect of further crushing defeats in the 11 state elections in 2010) mean that most ambitious politicians are already factoring in to their calculations the return of the PRI to presidential power in 2012.

To be fair, Calderón did make an attempt to seize the political initiative after his July defeat with his 10-point reform plan launched at the beginning of September, and he followed up that declaration of intent with the liquidation of Luz y Fuerza del Centro (LyFC), an egregiously mismanaged state-owned electricity company. But since the move on LyFC in October, Calderón appears to have lost heart. Ordinary Mexicans were shocked by the unprecedented TV pictures of Calderón being booed when he opened what is billed as the most modern soccer stadium in Latin America in Torreón, Coahuila on 11 November [WR-09-45].

Such overt hostility seems to have shaken Calderón. One example of this is his government's fumbling response to the result of its redundancy offer for members of the Sindicato Mexicano de Electricistas (SME) who were employed at LyFC. According to the government, just over 61% of the 44,000 SME members accepted the (comparatively generous) redundancy offer by the deadline of 14 November. The government, however, did not trumpet this as a victory, leaving the media to play up the union's claims that the figures were false. The SME bases this claim on the fact that 22,000 SME members have signed a petition supporting the injunction which the SME is seeking to stop the liquidation of LyFC and another 7,000 SME members have taken their own separate legal actions against the liquidation.

Another sign of the government's lack of confidence was its reaction to the changes made by congress to the budget. These were modest in economic terms though humiliating in in political terms: congress forced the government to drop its attempt to abolish three ministries and to introduce a 2% sales tax on food and medicine.

President Calderón, however, complained to the press on his flight to Singapore on 12 November where he was attending the Asia-Pacific Economic Cooperation (Apec) summit, that businessmen had been too critical of his budget proposals. Congress upheld the government's plan to increase income tax by two percentage points (from 28% to 30%) and to raise Vat from 15% to 16% (except in border states). Most political commentators say that these two changes were the main reason for the booing of Calderón at Torreón on 11 November.

Calderón claimed, on the trip to Singapore, that the country's main business lobbies such as as the Consejo Empresarial, had been far too critical of what the government had proposed. He said that business leaders' criticism of the budget had meant that there was less room for negotiation with congress. 

The president, however, did not seem prepared to negotiate. At the Veracruz Business summit organised by Miguel Alemán Velasco in Monterrey on 9 November, Calderón's security team refused to allow the audience the usual comments and questions on the president's presentation. It was notable that the applause for the president, from his business audience, was cursory and came only at the end of his address.

What has shocked businessmen and their supporters in the media is Calderón's populist claim that businesses and businessmen are not paying their fair share of taxes. On 29 October Calderón said: “It seems unacceptable to me that there are big companies which are demanding that the government cut its spending, which the government has done […] but according to the statistics the companies have been paying 1.7% taxes for years. This is unacceptable. I'm not asking companies to pay more in tax than a dentist or a clerk. I'm asking that they do their bit and obey the law."

Businessmen, who backed Calderón against a genuine leftwing populist Andrés Manuel López Obrador in the presidential elections in 2006, were horrified at Calderón's wild statement. The question they are asking is: where does the 1.7% figure come from? López Obrador has also cited it. It appears to be a figure based on turnover, not net income. This has led to jibes that the president has spent so long in public life that he does not understand the difference.

Calderón's complaining about businessmen shows that he has lost his core constituency: the small regional businessmen who have to struggle with Mexico's huge bureaucracy; a lack of credit; competition from the informal economy, and the threat posed by organised crime. In his election campaigning, Calderón pitched to them, in particular.

If Calderón has lost this constituency, the PAN is likely to desert him and shift further to the right. The PRI, which got what it wanted from Calderón in the 2010 budget, which increased transfers from the federal government to (mostly PRI-controlled) state governments and also boosted federal money from agriculture (another PRI interest), would welcome such a shift because its chance in 2012 would become a certainty. 

• The budget

The chamber of deputies approved the spending side of the budget on 17 November, two calendar but not legislative days past the deadline. International credit rating agencies are unhappy with the budget and say that they are reviewing Mexico's credit rating for a possible downgrade. The budget calls for spending of M$3.17 trillion (US$244.33bn). This is only US$305m more than the proposal submitted to congress by the government on 8 September, even though congress has rejected the government's plan to close three ministries (public function, agricultural reform and tourism). Altogether the budget calls for government spending of the equivalent of 25% of GDP. Public spending will rise by 6% in real terms, illustrating how dependent the economy is on stimulus from the government. In GDP terms, the government aims to grab about 1% extra in taxes from the private sector to meet its spending plans. The government reckons that this money will boost growth by 1.5% of GDP.
    One oddity was the last-minute increases in the budgets for higher education and agriculture. There is a fear amongst economists that this spending will be used for political, rather than economically productive, purposes. One key line of spending is the war on organised crime. The defence ministry is getting US$3.3bn; the navy, US$1.2bn; the attorney general's office (Procuradurí­a General de la República), US$906m; and the ministry of public security, US$2.5bn. The other big spending ministries are education (US$16.1bn) and health (US$6.9bn). Infrastructure spending will come to US$3.9bn in 2010. The budget for the state oil company, Petróleos Mexicanos (Pemex), at US$28.9bn is higher than education, health and infrastructure spending combined.

• Budgets

The lower chamber, controlled by the opposition PRI, reduced the 2010 budgets for the presidency - in the interior ministry and the labour ministry - while increasing the budgets for two of the ministries President Calderón wanted to abolish: agricultural reform and tourism.

Uruguay's new president, José Mujica, paid his first official visit abroad to Bolivia last week where, unsurprisingly, he met with a warm reaction from his left-wing Bolivian peer, Evo Morales, who proved more than forthcoming in extolling his credentials as a model leftist ideologue. Amid the mutual backslapping and accolades, a notable outcome of the encounter was the very real prospect of reviving Urupabol, the now-defunct triple strategic association alliance between Uruguay, Paraguay and Bolivia, conceived in the 1960s as a geopolitical counterweight to Argentina and Brazil.

Morales who only visited Montevideo in an official capacity for the first time last July [WR-09-28], was unabashed in his praise for Mujica, for whom he declared his “public admiration", dubbing him the “grandfather of ideological principles". Mujica in turn responded with some strong words of support for Bolivian “culture and tradition" and, specifically, the decriminalisation of the coca leaf, a cause célí¨bre of the Morales administration.

Gas and sea
Of the plans to boost cooperation discussed by the two leaders (which included agriculture and education), by far the most significant involved the possibility of Bolivia selling gas to Uruguay. This, together with Uruguay's offer to grant Bolivia access to the Atlantic, which was also floated once again during Mujica's visit, form key components of the Urupabol alliance.

While Morales has long been a keen proponent of the initiative, Mujica's predecessor, Tabaré Vázquez was more reticent, pursuing a trade and economic policy which focussed on free trade agreements rather than strengthening ties with his neighbours. This, however, appears set to change under Mujica who declared securing Bolivian gas a “matter of urgency". The benefits for both sides are clear. Bolivia is seeking new export markets in light of the waning demand of Brazil, its main customer, while Uruguay, which currently imports from Argentina, stands to gain from the prospect of lower prices: Uruguay currently pays US$16 per million BTU (British Thermal Units), more than twice the US$7/million BTU Bolivia charges Argentina.

With both leaders signing an accord pledging to “accelerate" the process (already floated during Morales's visit to Montevideo), three options are now on the table. The first is to use the existing pipeline to Argentina - a short-term possibility to be discussed when Argentina's President Cristina Fernández visits La Paz later this month, (ostensibly to sign a deal to boost gas exports to Argentina from 5m cmd to 27m cmd by 2014).

A second, medium-term option involves building a liquefied natural gas (LNG) plant in Bolivia's Tarija province to provide gas to Uruguay and Paraguay. This project, which would cost an estimated US$150m to be completed over 18 months, would signify a revival of Urupabol. As would the third option - constructing a pipeline from Bolivia to Montevideo which would take between seven and 10 years to complete at a cost roughly estimated at between US$1.5bn and US$2bn. The Andean Development Corporation (CAF) has already launched a call for tenders to carry out the pre-feasibility study for the so-called “Urupabol pipeline".

As regards the possibility of allowing Bolivia to use Uruguay's ports of Nueva Palmira or Montevideo, Mujica's new foreign minister, Luis Almagro, was clear to stress the interest for both sides - Bolivia in gaining access to the Atlantic, particularly given Chile's new president Sebastián Piñera has made it clear he will not meet Bolivia's aspiration for a Pacific Sea outlet [WR-10-09]; and Uruguay in establishing itself as a “logistical centre". Last year the director of the Bolivian institute for foreign trade (IBCE), Gary Rodrí­guez, estimated that this could save Bolivian exporters between 10% and 20% in operating costs.

Since returning from Bolivia, Mujica has offered Uruguay's ports not just to Bolivia but also to Paraguay as part of efforts to promote regional integration. The question of sea access would entail reviving the Hidroví­a Project, an old plan to turn the 3,400 km Paraguay-Paraná river system into a shipping lane passing through Argentina, Bolivia, Brazil, Paraguay, and Uruguay. In June 1995, the United Nations Environmental Programme called on the governments of the La Plata Basin to halt work on the project until studies on environmental impact had been completed.

More tentative signs of regional integration
The promise of a revived Urupabol alliance was preceded by Bolivia's return to the negotiating table on 5 March for talks between the Andean Community (CAN) and the European Union (EU) over a bloc-to-bloc trade association agreement. This signals the first time that all four members of CAN (Bolivia, Ecuador, Peru and Colombia) have met to discuss the agreement since Bolivia and Ecuador pulled out last July over differences regarding free trade and integration. Bolivia's return follows Ecuador, which rejoined the talks shortly after the EU finally struck an agreement with Latin American banana exporters in December in compliance with the World Trade Organization and, essentially, abandoned banana quotas [WR-10-06].

While the 5 March meeting yielded an agreement by both sides to form a “working group" to promote negotiations, this is nevertheless unlikely to yield immediate results. Bolivia's deputy foreign trade minister, Pablo Guzmán, maintains that the initial objections remain: these are based on complaints that the EU is violating the Andean pact by negotiating free trade agreements (FTA) unilaterally with Peru and Colombia. His concerns follow the announcement on 8 February by Bolivia's foreign minister David Choquehuanca that Bolivia would present four appeals before the Andean justice tribunal to protest the violation of various CAN norms. These relate to the violation of intellectual property clauses in FTAs with the US (particularly the Peru-US FTA) and the rights of signatories to negotiate such deals bilaterally.

• Paraguay
  Paraguay's President Fernando Lugo has also shown himself to be in favour of reviving Urupabol. Last April he floated the possibility of Bolivia providing Paraguay with natural gas in exchange for electricity. Bolivia's energy minister, Fernando Vincenti, recently put Paraguay's demand for gas at 3m cubic metres a day (cmd) - similar to that of Uruguay.
  
• New gas law
  Bolivia's energy minister Fernando Vincenti emphasised that the new hydrocarbons law currently being drafted by the government aimed to promote the diversification of export markets. He told reporters that the new law, which aims to boost gas production from the current 40m cmd to 71m cmd by 2015, was necessary as current legislation (introduced in 2005) was “obsolete" and ill-equipped to provide for the sector's “appropriate development".

TRINIDAD & TOBAGO | New PNM leader. Dr Keith Rowley officially became the new leader of the now opposition People's National Movement (PNM) on 27 June after his nomination for the post was uncontested. A political old-timer with various cabinet positions to his name (including the planning, housing and trade ministries), Rowley is an inveterate rival of his predecessor, Patrick Manning, who stepped down following the PNM's disastrous performance in last month's general elections [WR-10-]. While pledging a change in style, Rowley - who is the fourth PNM leader since the party was founded 54 years ago, and the first Tobagonian to assume the post - has said that any major restructuring of the PNM will only take place after the 26 July local government elections.

The government's presidential candidate, Dilma Rousseff, holds an 11-percentage point lead over her rival José Serra heading into the second round run-off on 31 October. A survey by DataFolha, the most accurate pollster in the first round, released five days before the elections, shows she has consolidated her lead over Serra halting, and reversing, the momentum he appeared to have picked up. Eight percent of voters are still undecided so there is still a slim chance Serra could upset the odds. He attacked Rousseff for corruption in the penultimate TV debate on 25 October and will be hoping that this, along with recurring allegations implicating Rousseff with smearing the opposition, could influence the outcome.

The current affairs magazine Veja led its latest issue with a story based on a recording of a talk between the national justice secretary, Pedro Abramovay, and his predecessor, Romeu Tuma Junior, who left the government in May amid allegations he was involved with a notorious contrabandist [WR-10-19]. In the recording, Abramovay complains to Tuma Junior that he “cannot stand any more requests from Dilma [Rousseff] and Gilberto Carvalho to prepare dossiers" smearing the opposition. Abramovay, Rousseff and Carvalho all denied the allegations, but Tuma Junior confirmed he had that conversation.

Veja has refused to say how it acquired the recording, which was made by the federal police, but it looks like Tuma Junior, a former federal police constable, leaked the recording as revenge on the government for his dismissal. “There is a heavy game going on. In order to hit a certain target, some [in the government] are using illegal methods of investigation. You either do what you are told without question or you become a target yourself. That is what happened to me," Tuma Junior claimed.

Veja's latest allegation comes at the end of a federal police investigation over the leaking of confidential tax records of members of the opposition Partido da Social Democracia Brasileira (PSDB) and of the family of the party's presidential candidate, José Serra [WR-10-32]. According to the federal police, the details were leaked by journalist Amaury Ribeiro Junior, who purchased the tax records from staff in the Inland Revenue for R$12,000 (US$7,000). According to Ribeiro Junior's deposition to the police, which was leaked to the press, the tax records were stolen from him by Rousseff's communications campaign coordinator, Rui Falcão, while they discussed their use in the preparation of dossiers by Rousseff's campaign team. Falcão denied having met Ribeiro Junior, while Rousseff tried to spin the story by claiming that the tax record leaks were the product of a “quarrel between the PSDB's presidential hopefuls" in a reference to the struggle between Serra and senator-elect Aécio Neves for the party presidential nomination. The PSDB accused Rousseff of “attempting to deceive the electorate."

Meanwhile, Rousseff's former right-hand woman, Erenice Guerra, admitted to the federal police that she met with two businessmen that accuse her sons of charging kickbacks to guarantee contracts with the federal government. She had previously denied having met the two men, but now says she only talked to them about “technicalities." President Lula da Silva's private secretary, Gilberto Carvalho, was indicted in a court case for “administrative impropriety" after a judge found enough evidence that he was behind an embezzlement scheme to fund the presidential campaign of the ruling Partido dos Trabalhadores (PT) in 2002 while serving under mayor Celso Daniel in the metropolitan region of São Paulo. Daniel was murdered that year, prompting speculation he was going to report the scheme to the police.

TRINIDAD & TOBAGO | Deepwater drilling. Trinidad & Tobago's energy minister, Carolyn Seepersad-Bachan, revealed that a consortium comprising Spain's Repsol, BHP Billiton (Australia/US) and France's Total SA were among those interested in bidding for an offshore oil exploration block located in Trinidad & Tobago waters. The local press reported the government had received five bids on three of the 11 blocks up for bid for energy exploration. Seepersad-Bachan said that an evaluation process would now take place with successful bids to be announced on 29 April. She said the government believes there is a significant amount of oil to be found in the deepwater and potential for gas to be discovered. If crude is found in commercial quantities estimated to be in excess of 350 million barrels, she said, it will be developed. According to the energy ministry, Trinidad & Tobago currently produces 123,000 barrels of oil per day and approximately 4 billion cubic feet of natural gas per day.

REGION | Forecasts. The Central American Bank for Economic Integration (Cabei) last week announced its 2011 forecasts for Central America and the Dominican Republic. It expects Panama to register the highest growth (7%-8%), followed by the Dominican Republic (6.4%-7.4%); Costa Rica (5.3%-6.3%); Nicaragua (3.4%-4.5%); Honduras (3%-4%); Guatemala (2.4%-3.4%); and El Salvador (1.2%-2.2%). Cabei expects Nicaragua to top the region in terms of inflation, with 9.3% forecast for 2011, followed by the Dominican Republic (7.2%); Honduras (6.9%); Costa Rica (6.3%); Guatemala (6.2%); Panama (4.5%); and El Salvador (3.7%).

If President Vicente Fox is to be taken at his word, he will be devoting much of the second half of his term to an overhaul of Mexico's legal and policing system, as recommended in a unique study he commissioned from the local delegation of the Office of the UN High Commissioner for Human Rights. This will entail replacing some of the pillars of the current approach to public security, such as the heavy involvement of the military and the central role in federal policing assumed by the chief prosecutor's office, the PGR.

The 8-month study directed by the UNHCHR envoy, Anders Kompass, with the cooperation of 12 human rights organisation, is entitled `Diagnosis on the Situation of Human Rights in Mexico' but, as underlined by Kompass, their brief was unique in that they were asked not only to point out what is wrong, but also how to remedy it. The report ends with 31 `main recommendations'.

Redefining roles
Perhaps the most momentous of these recommendations is the clear separation of roles of the preventive police services and those devoted to criminal investigation. Moreover, it says that the PGR, as the prosecutorial service, should be excluded from the national public security system, and that the federal preventive police, while supporting the professionalisation of their local counterparts, should not replace them in their functions.

It also recommends the `progressive and verifiable replacement of the armed forces in public security functions.' The Fox government has resorted to the military to cover the perceived shortcomings of the police, and to take the lead in the antidrugs effort. In the first of those roles there has already been some replacement, though it has been short of verifiability.

As regards the antidrugs effort, the military have been given a lead role, ostensibly while the new federal investigative agency, the AFI, builds up its cadres of newly trained officers. Chief prosecutor Rafael Macedo, himself a retired general as well as a lawyer, believes that the withdrawal of the military, while advisable, will take some time. He has not commented on the recommendation that the PGR, to which the AFI reports, should be relieved of its policing role. Additionally, the report comes down in favour of abandoning the inquisitorial trial system — a major cultural upheaval — on the grounds that it tends to reverse the presumption of innocence.

It touches upon two issues that have been receiving headline attention: the murders of women in Ciudad Juárez and the indigenous rights provisions in the constitution. On the former it recommends periodical publication of progress in the implementation of advice proffered by national and international organisations; on the latter, that congress should reopen the debate and seek to adjust the provisions to the principles agreed in the San Andrés agreements between the Zapatistas and the government. What will happen next is not clear. Fox has said he will set in motion a human rights programme to implement all 31 main recommendations. However, some of his officials have already been describing the UN `Diagnosis' as `incomplete', urging only partial implementation.

Two recent developments related to the war in Colombia have highlighted the extent to which words have become weapons: the diplomatic spat over an Ecuadorean minister's assertion that his government does not consider the Farc guerrillas to be 'terrorists', and President Alvaro Uribe's decision to reverse an earlier stance and recognise what is happening in his country as a 'conflict'. In both cases, the choice of terms has consequences.

On 2 September Ecuador's defence minister, retired General Oswaldo Jarrí­n, stated publicly that his country did not consider the Farc a 'terrorist' organisation but an 'irregular armed group'. Colombian President Uribe reacted angrily, calling this view 'myopic'. The Colombian government has consistently labelled the Farc terrorists, and has succeeded in persuading the US government to classify it formally as an international terrorist organisation.

In his response to Jarrí­n, Uribe reiterated his rationale for so classifying the Farc (and other illegal armed groups) in the following terms: 'When there is a pluralist democracy [...] any armed action against that democracy is, in the civilised world, called terrorism. If we had here a dictatorship, the curtailment of public liberties, the mistreatment of democratic rights, there would be motive, at home and abroad, for these groups to be legitimised or denied the classification as terrorists. [These groups] are also terrorists because of how they act. The Colombian hospitals and rehabilitation centres [...] there are nowadays more than 1,400 people, soldiers and police, mutilated by the antipersonnel mines laid by these groups. And they are terrorists because of the manner in which they mistreat civil society. And they are terrorists because of the manner in which they ignore humanitarian norms. And they are terrorists because of the source of their funding: drug trafficking and kidnapping.'

Ecuador's defence ministry retorted that Jarrí­n's statement coincided with 'Ecuador's traditional position regarding the Colombian conflict, which is of absolute non-intervention.' It added that 'the Ecuadorean foreign ministry, as part of the state's foreign policy, has never classified the Farc as a terrorist group, as the Colombian president pretends to force Ecuador to do.' The ministry recalled the definition of this stance by foreign minister Nina Pacari at a meeting of hemispheric security held in Bogotá in March 2003. She had said, '[For Ecuador] the Farc is an irregular group operating outside the law. We know that classifying a certain group as terrorist is each country's sovereign decision. In that sense we shall continue to call it an irregular group.'

Pressure to adopt the label
Colombia and the US have long been trying, unsuccessfully, to persuade other Latin American countries to join them in issuing, via the Organisation of American States (OAS) a formal classification of the Colombian armed groups as terrorists. From early on, opposition to this has been led by Brazil. President Lula da Silva has argued that such a step would handicap efforts to mediate a peace settlement. In the UN, the US has succeeded in obtaining Security Council resolutions that commit UN members to take a number of actions against those deemed terrorists or financiers of terrorism. US officials have recently complained that many UN members were ignoring these resolutions.

Most recently, on 14 September, the Security Council announced its commitment to making the incitement of terrorism punishable by law. Careful wording was considered vital by all participants, particularly the US. Just before the UN's 60th Anniversary Summit (14-16 September) the US objected to a passage in the draft declaration on the proposed Comprehensive Convention on International Terrorism stating that 'the targeting and deliberate killing of civilians and non-combatants cannot be justified or legitimised by any cause or grievance', insisting that it should make clear that the paragraph addresses only actions taken by terrorists. The US ambassador to the UN, John Bolton, said, 'We consider these changes of critical importance to ensure that the scope of this paragraph is limited to terrorist actions, and does not address military activities that are appropriately governed by international humanitarian law.'

The US also objected to the Convention including, as the draft declaration said, 'a legal definition of terrorist acts', preferring instead that it should provide 'a non-exclusive list of actions that would amount to terrorist acts.' A high official in a Latin American delegation said this showed intent to shield the US from having the Convention invoked against it (much in the same way as it seeks immunity from actions by the International Criminal Court), and to reserve to itself the right to define what constitutes terrorism, particularly international terrorism.

Defining international terrorism
One of Spain's leading scholars in this field, Fernando Reinares (author of Terrorismo y antiterrorismo, currently senior analyst on international terrorism at the Real Instituto Elcano de Estudios Internacionales y Estratégicos), recently published a paper* warning about the danger of talking about international terrorism 'in terms that are excessively vague or imprecise'. He says, 'The problem of how to define this phenomenon may also affect how it is perceived by the media, public opinion, academics and political elites in our societies. It may even affect decision-making related to specific governmental measures aimed at dealing with the nature and scope of this violence, as well as the widely-shared understanding on which effective governmental cooperation needs to be based in order to combat the risks and threats inherent to this phenomenon.'

He worries about the fact that legal codes and international treaties seldom refer specifically to international terrorism and refer instead to terrorism generically, regardless of where it occurs - and when they do get specific, they tend to use descriptions that confuse it with transnational terrorism in the broad sense or simply with foreign terrorism. The instance he cites for this is the US Patriot Act, passed by the US Congress little more than a month after 11 September 2001, which distinguishes between domestic terrorism, occurring mainly within the territorial jurisdiction of the US and international terrorism, occurring outside US borders or going beyond national borders.

Reinares also criticises academic definitions for often failing to provide 'a specific analysis of international terrorism or else tend to define it as simply an externalisation of terrorism in general, whether on the part of state or non-state actors, beyond the confines of a specific country.'

*Conceptualising International Terrorism, ARI N º 82/2005, Real Instituto Elcano de Estudios Internacionales y Estratégicos.

He notes that transnational terrorism and international terrorism are often confused when, in fact, the former includes the latter, but not vice-versa. Transnational terrorism, he says, 'in one way or another crosses state borders, essentially because those who perpetrate it maintain organizational structures or carry out violent activities in more than one country, generally including territories over which the authorities to whom their demands are directed have no jurisdiction.' International terrorism, he argues, is very different. First, it is 'practiced with the deliberate intention of affecting the structure and distribution of power in entire areas of the world and even at the level of global society itself.' Second, 'the individuals and groups who carry it out have extended their activities to a significant number of countries and geopolitical regions, in accordance with their declared aims.'

Seen through this prism, neither the Farc, the Ejército de Liberación Nacional (ELN) or the paramilitary Autodefensas Unidas de Colombia (AUC), would fit the description of international terrorist organisations.

Reinares tackles a related issue with Latin American ramifications. Within the broad spectrum of Islamist terrorist organisations he distinguishes between those who are international terrorists (al-Qaeda and its associated groups) and those which are not - he specifically cites Hamas, which though 'broadly transnationalised' does not have global or even regional aims. Hamas is one of the Middle Eastern organisations receiving funds from members of the Arab communities in Latin America; because they are classified as international terrorists by the US, their financiers have become targets in Washington's 'War on Terror'.

The Spanish scholar throws in a caveat which could be seen as applicable to the Latin American scene. He says that the long-term strategy of any form of international terrorism is entirely compatible with more limited, shorter-term objectives such as causing a change of regime or political alignments in a given country, or even fighting for the creation or disappearance of a state. These can then be seen as international terrorism, 'as long as they are also part of a much more ambitious political project.' It can, and has been argued, that the Farc is part of a grand design aiming ultimately at the installation of likeminded governments throughout the region.

What kind of war?
On 6 September, President Uribe, in a bid to coax the ELN back to the negotiating table, decided to concede formally is that Colombia is in a 'conflict' a term almost obsessively avoided so as to ward off any chance that he might have to observe international conventions regarding the conduct of war. Such had been his zeal in this regard that he ordered internal government documents, even about economic matters, rewritten with the word excised. There was a near-revolt among his diplomats when he tried to get them to persuade international organisations to follow suit. The approved description of what Colombia was undergoing was 'a terrorist challenge to the institutions'.

He explained his change of heart as follows: 'If the ELN accepts [a] cessation of hostilities, I will recognise whatever they want. This very moment I say it: for the sake of the superior conveniences of the fatherland I set aside my personal convictions, and in the name of the presidential institution I accept that there is a conflict.'

Uribe has not been alone in seeking to avoid definitions that could conceivably make the Colombian government liable under international law. His predecessor, Andrés Pastrana, took pains to avoid the description of the conflict in Colombia as a civil war - an issue over which there was much heated debate among politicians, academics and pundits towards the end of his term.

Pastrana did occasionally refer to the conflict as a war. He once said that Colombia was undergoing two simultaneous wars: 'the drug traffickers' war against the country and against the world, and the guerrillas' confrontation with an economic, social and political model that they consider to be unjust, corrupt and on the side of the privileged.' This, however, was rhetoric, leading up to his punchline, which was that Colombia was not undergoing a civil war, but 'a war against the civilians.'

Defining what kind of war Colombia has been undergoing is important from the point of view of international law, which distinguishes between four types: armed international conflicts; wars of national liberation; non-international armed conflicts as envisaged in Article 3 of the Geneva Convention; and non-international conflicts as envisaged in Protocol II of 1977. At stake is whether the laws of war apply to the conduct of the conflict.

Internal or non-international conflicts are distinguished according to their intensity. At the low end of the scale is rebellion, involving commotion and violent protest, with sporadic confrontations with the forces of the state. Next comes insurgency, a situation in which the government is not able to keep the peace and exercise authority over all of its territory. Finally comes belligerency; conflict of such intensity that it is treated as tantamount to international conflict as regards the application of international law.

On or beyond the threshold?
Clearly Colombia has gone beyond the stage of rebellion; the question is whether it has 'graduated' from insurgency to belligerency in general parlance, to a full-fledged civil war. Adopting the definition used by Paul Collier and Anke Hoeffler, in which a civil war is 'an internal conflict that brings about at least one thousand combat-related deaths', it has certainly passed that threshold.

A parallel argument is whether the Colombian war has already become 'internationalised', by virtue of US involvement, its spillover into neighbouring countries and the international ramifications of the drugs industry. The answers to this tend to split along political lines in Latin America, with the left maintaining that it has indeed become internationalised, while further to the right the view is that it has so far been largely contained within Colombia. This would have changed had the US succeeded in persuading other Latin American governments to 'multilateralise' the response to the Colombian conflict.

Some scholars have argued that a distinctive feature of a full-fledged civil war is the polarisation of the entire population into opposing camps. There is much evidence that Colombia is not thus polarised and that those segments of the population that have become involved have on the whole done so reluctantly but here again the facts tend to be disputed along political lines.

Pastrana's interpretation of the conflict as a 'war against the civilians' does not bear much scrutiny. Though civilian fatalities have indeed been high, the guerrilla organisations have targeted the security forces and other agents of the state. It is quite clear that there is a conflict between the illegal armed groups and the state. As noted by Colombian historian Eduardo Posada Carbó, the guerrillas themselves define it in this way, even though the Farc frequently proclaim that they are 'a part of the people who have taken up arms'.

Uribe's earlier definition of the conflict as 'a terrorist challenge to the institutions' hinges on the term 'terrorist', which takes the matter back to his quarrel with the Ecuadorean defence minister. Still to be seen is whether the redefinition of the situation in Colombia as a conflict is followed through by the application of international law to the conduct of the war.

Colombia is no stranger to the transformation of people once classified as terrorists into established politicians. Perhaps the best example is Antonio Navarro Wolff, past leader of the M-19 guerrillas who negotiated the downing of arms in 1990 who is currently a senator and the presidential candidate of the leftist Polo Democrático Independiente.

Crackdowns on both sides of the Brazil-Paraguay border have been revealing the extent to which corrupt police have been aiding the traffic of drugs, arms and contraband goods. Cooperation between both countries' law-enforcement agencies has also led to the neutralisation of one of the supply sources for the belligerent São Paulo drug gang known as Primeiro Comando da Capital (PCC).

In early June the Brazilian federal police launched Operação Xeque-Mate ('Operation Checkmate') against organised crime in six states: Mato Grosso do Sul, Mato Grosso, Minas Gerais, São Paulo, Paraná and Rondônia. In the first of these operations 20 people were arrested - among them five officers of the state's military police (including a lieutenant-colonel and a major) and eight agents of the civil police, charged with taking bribes from drug traffickers and involvement in gunrunning. Also arrested, in Mato Grosso do Sul, were a former legislator, Roberto Razuk, and four businessmen. In all six target states, the police arrested 87 people.

Days earlier the federal police had dismantled a smuggling ring which operated across Lake Itaipú, and intercepted a shipment of 174 kilos of cocaine in the state of Paraná. This last coup led to information which allowed the Paraguayan police to arrest -in the border department of Amambay- Edmar Dos Reis de Almeida, who is reputedly high up in the hierarchy of the PCC, the São Paulo drug gang, which in May 2006 unleashed a wave of violence that left a toll of 141 dead. Almeida was found in possession of Paraguayan identity documents issued only a few days earlier, even though he had long had an international arrest warrant pending.

Hugo Castro Ibarra, head of Senad, Paraguay's antidrugs secretariat, said Almeida had been shipping to Brazil every month about 200 kilos of cocaine and 'tonnes' of marijuana.

Just after Almeida's arrest, Paraguayan police intercepted a truck carrying 10.2 tonnes of marijuana in the border department of Canindeyú. The truck was on its way to Brazil. This is the biggest seizure of marijuana since the 10t haul taken in February 2003. Amambay and Canindeyú departments are the source of most of the marijuana smuggled into Brazil and Argentina.

In the first four months of the year Senad agents destroyed marijuana plantations with an estimated production potential of 2,715t, and seized 4.9t of leaf pressed and packed for distribution - all in Amambay and Canindeyú, next to the Brazilian border. Agents located and destroyed 176 makeshift camps of marijuana growers, and 56 leaf presses.

Spike in Argentine seizures

The Gendarmerí­a, Argentina's border police, have reported that seizures of marijuana in the first four months of this year reached 32.1 tonnes, well above the 25t seized in the whole of 2006 and higher that the previous record haul of 31.5t of 2003. In May the Prefectura Naval (coastguard and riverine police) seized a single shipment of 2.1 tonnes of marijuana in the northeastern province of Misiones, which borders on Paraguay.

Officials say the higher level of interceptions is due to two factors. The first is the establishment of inland 'strategic controls' in areas close to Argentina's northern borders. The second, that Paraguay - source of most of Argentina's imported marijuana - has just had a bumper harvest, which lowered prices and increased demand in Argentina [SSR-07-05].

In Buenos Aires, interior minister Aní­bal Fernández claimed, in early June, that overall drug seizures have increased 'two-and-a-half times' over the levels of two years ago. This has prompted the Argentine government to seek what it calls 'pragmatic' bilateral agreements with all the drug-producing and transit countries in South America, in which direct cooperation is established between interior ministries, public prosecution services and law-enforcement agencies.

New 'pragmatic' cooperation deals

On 8 June Fernández announced that Argentina would be seeking 'operational' bilateral agreements on antidrug cooperation with South America's producer and transit countries. The first group includes Bolivia, Colombia and Peru, the second, Brazil, Chile, Ecuador, Paraguay, Uruguay and Venezuela. He explained this as part of a more pragmatic approach to international cooperation in this area: 'We have signed many state-to-state agreements, but nobody knows what to do with them. That is why we now want to sign operational memorandums of understanding, this time between interior ministries, prosecution services and law enforcement agencies, at bilateral level.'

Roughly modelled on two existing agreements (a two-year-old one with Spain and a week-old one with Peru), the proposed new accords would enable the use of 'modern tools' for the exchange of information, controlled deliveries of drugs, detection of traffic in arms and precursor chemical and tracking of funds linked to money-laundering.

According to Fernández, the agreement with Spain enables information within hours of seizures of drugs or arrests of traffickers arriving from Argentina, a far cry from the traditional monthly delays known under previous arrangements. The agreement with Peru allows migration authorities to access a database to verify if an arriving Peruvian is on record as involved in drug trafficking. This agreement has enabled close cooperation between Peru and Argentina in the investigation into the activities of gangs of Peruvian traffickers who have recently been engaging in turf wars in Buenos Aires slums that have left a toll of 15 dead.

Brazil's Bolivian connection

Paraguay is Brazil's main source of marijuana and Bolivia is growing rapidly as a source of its cocaine, as controls on the traffic from Colombia tighten. Brazilian diplomats are cited by the newspaper La Razón claiming that 80% of the cocaine produced in Bolivia is exported to Brazil, and that the main buyer is, once again, the PCC, the heavily armed São Paulo drug gang the authorities have been trying hard to put out of business.

Precisely how much this adds up to is unclear. Bolivia's antidrugs force, Fuerza Especial de Lucha Contra el Narcotráfico (FELCN), reckons that about 2 tonnes of cocaine a month elude their efforts, but this, plus what is recovered, is far less than the country's estimated potential cocaine production [see pages 7-9]. In the first quarter of this year FELCN seized 4t of cocaine, destroyed six cocaine-processing labs and arrested more than 650 people suspected of involvement in drug trafficking. FELCN says it has identified five border crossings through which cocaine and precursor chemicals are shipped to Brazil, all of them in the eastern department of Santa Cruz. The existence of an outflow of precursor chemicals into Brazil suggests that that country has already joined the ranks of the producers, much as Argentina, and more recently Ecuador appear to have done.

The office of the UN representative in Colombia has pointed out that the gains made by the government in the internal conflict is not an unblemished success story. It says that extrajudicial executions, forced displacement and the emergence of new paramilitary groups are continuing features.

On 5 March, the office of the UN High Commissioner in Colombia (UNHCC) released its annual report on the situation of human rights and international humanitarian law, in which it expresses concern for three developments recorded over the past year: (1) the so-called 'false positives', instances in which extra-judicial executions are presented as the killing of guerrillas in armed confrontations, (2) the proliferation of new armed groups in many cases involving past members of the demobilised paramilitary organisations, and (3) the continuing forced displacement of people.

The 'false positives', says the UNHCC, are the main blot on the performance of the armed forces. Its report notes that the public prosecution is investigating 716 incidents involving 1,171 fatalities, of which 81 in 2008. It says that these episodes 'are not isolated, but a widespread practice by an important number of military units across the country.'

The UNHCC reports that 150 new criminal gangs have emerged, mostly formed by demobilised paramilitary fighters. 'Many of their leaders,' it says, are brothers or lieutenants of the commanders of the Autodefensas Unidas de Colombia (AUC).' [A report issued by the national police on 17 March says that so far this year 402 members of 'emerging groups' (new paramilitary outfits) have been arrested and nine have been killed in armed confrontations. Seventy-two of the detainees and two of those killed were identified as former members of paramilitary organisations.]

The UN office also draws attention to the skewed application of the 'justice and peace' legislation under which the demobilisation of the armed groups took place. It notes that of 50,505 people demobilised (of whom 35,263 as member of paramilitary organisations), so far only 10% have been granted the treatment envisaged in the 'justice and peace' legislation. Statements have been taken from 1,626, of which 430 are currently being processed. Only 20 have been committed to trial and so far, three-and-a-half years after the beginning of the demobilisation, no sentences have been passed.

Testimonies from the demobilised fighters led in 2008 to the location of 410 clandestine burial sites containing 560 bodies. This took the total since 2006 to 1,420 burial sites with 1,750 bodies, of which 249 have been identified and handed over to their next of kin.

The report points out that though the number of fatalities caused by the armed conflict has fallen sharply, forced displacement continues on a large scale. Javier Hernández, deputy head of the UNHCC, says that different sources put the number of displaced persons anywhere between 2m-plus to 3-4m. 'Whatever the actual figure,' he says, 'the situation of the displaced [in Colombia] is among the two or three worst on the planet.'

Along Colombia's western land border  Panama has begun to play a role similar to that which Ecuador has been performing in the south: sealing the border at the time of a Colombian offensive against the Farc guerrillas, denying them the opportunity of seeking refuge within the neighbouring territory. Also like their Ecuadorean counterparts, the Panamanian authorities are reluctant to admit that they are doing this in concert with the Colombians.

On 4 October the Colombian military and police launched Operación Darién, which began with the bombing of a Farc encampment sited about 700 metres of the border with Panama. The director of the Colombian national police, General Oscar Naranjo, said that among the five bodies found on the scene was that of the man known as Silver, reputedly the leader in charge of the finances and logistics of the Farc's 57th front. According to Naranjo, this completed the targeting of the men forming the 'tripod' of the guerrillas' finances (the first two legs of which had been 'El Negro Acacio', killed in September 2007, and 'Edgar Tovar', killed in January 2010). The 57th front is in charge of coordinating the northward flow of cocaine through Central America.

On 5 October the Colombian defence minister, Rodrigo Rivera, publicly thanked the Panamanian government for 'its cooperation [...] in the sense of simply securing their territory, of exercising sovereignty over their own territory.' This, he said, allowed Colombia to carry out 'highly efficacious' operations.

Two days later, Panamanian security minister José Raúl Mulino said that he could not understand the reason for Rivera's expressions of gratitude. The Panamanian government, he said, had had no prior knowledge of the Colombian operation. According to Rivera, back in July Panama had strengthened its security presence on the border close to where the 4 October bombing took place, forcing the Farc to redeploy to the northern and central extremes of the border, where Panama is now building up its presence.

Mulino did acknowledge that Panama and Colombia have been coordinating their patrols along the common border, and have been sharing information regarding the movements of 'irregular groups' operating close to it. Indeed, this has been openly announced, and had elicited from the Panamanian opposition the claim that the government of President Ricardo Martinelli was allowing Colombian military commanders to dictate Panama's security deployments. Now these same critics are asking why, if Mulino meant what he was saying, something as important as the bombing of a Farc camp so close to the border had been apparently left out of the bilateral exchange of intelligence.

The security minister had an answer: no communication, information or prior authorisation was required for an action such as the 4 October bombing, because each country is sovereign and can deploy its military forces as and when it pleases.

Mulino had previously faced potential embarrassment over the media's portrayal of statements he had made in Bogotá in September as a Panamanian 'declaration of war' on the Farc. On the occasion he issued a denial and blamed this portrayal on a misinterpretation of his utterances by the international news agencies and Colombian official press releases. Mulino had previously described the new Panamanian aeronaval Bahí­a Piña station as sending 'a strong and clear message to the forces of drug trafficking and terrorist insurgency', which everyone understood as a reference to the Farc [SSR-10-04].

On 17 January Sebastián Piñera, the presidential candidate running on a rightwing ticket for the Coalición por el Cambio, comfortably won the second round run-off. Piñera's win is historic. Not only is he the first rightwing candidate to win the presidency since the restoration of democracy in 1990 (after the Pinochet regime quit power), but he is also the first right-winger to win the presidency since Jorge Alessandri in 1958. Piñera will formally take office on 11 March and hold the presidency until 2014.

Piñera won by 51.8% to 48.1%, pretty much in line with the final opinion polls. His victory speech was elegant, arguing that his triumph was another victory for democracy. “Alternation [of power]" he argued, was a further development of democracy. He stopped just short of drawing a parallel between the 17 years of the Pinochet regime and the 20 years of Concertación rule.

Piñera went on to make it clear that his government would not try to settle scores or turn back the clock. He said that his administration would go in a fresh direction, starting from the base left by the Concertación. He put economic growth and job creation top of his list of priorities, followed by efforts to deal with crime and to improve law and order. Improving health and education came next, in the context of bettering prospects for Chilean families.

Piñera has a strong position in congress. The two main rightwing parties that made up the Coalición por el Cambio, his right-of centre Renovación Nacional (RN) and the traditional rightwing Unión Demócrata Independiente (UDI), have 58 seats in the 120-seat lower house, just three short of a majority. A small party of defectors from the Partido Democracia Cristiana (PDC), the Partido Regionalista de Independientes (PRI), may well supply the missing votes.

Piñera's problem may be that the UDI, which is the dominant partner in his coalition, will try to pull him away from the centre ground. The UDI has 37 deputies (up from 34 in the previous congress) and nine of the 38 senators. His RN lost two congressional seats and one senate seat in the 13 December general elections.

The defeated Concertación's immediate judgment on the result was that it had lost the election rather than Piñera had won it. The Concertación is bewildered that the staggering popularity of President Michelle Bachelet (almost 85% of the population think she is doing a fine job) failed to help Eduardo Frei Ruiz Tagle, the Concertación's candidate and also a former president (1994-2000). Bachelet, who herself defeated Piñera in the second round in 2006, may well be a candidate again in 2014.

On 23 January the Partido Socialista (PS), which was gored by the defeat of the ruling Concertación alliance in the presidential election, replaced its president. Three of the four constituent parties in the humbled Concertación have now replaced their leaders, who took the alliance into its first defeat in a presidential election since the return to democracy in 1990. The only party to have retained its president is the PDC: its national committee unanimously rejected the resignation of Juan Carlos Latorre, the party president, on 23 January. The PDC provided the Concertación's presidential candidate, Frei, who was chosen, controversially, without a proper internal Concertación primary. The PDC argued that Latorre should remain in his post until scheduled internal elections in April. The PS took the opposite view, appointing an interim president until its internal elections on 25 April.

The PS, meanwhile, replaced its president, Camilo Escalona, with Fulvio Rossi.  A young PS dissident, Marco Enrí­quez-Ominami, ran as an independent in the presidential contest. His candidacy undermined Frei (grabbing 20% of the votes, to Frei's 29% in the first round in December). Rossi immediately rejected the idea of negotiations with the incoming Piñera government. He also said that he would welcome back defectors such as Carlos Ominami (Enrí­quez-Ominami's stepfather); Alejandro Navarro Brain, a senator who now heads the Movimiento Amplio Social, and Jorge Arrate, who headed the radical leftist Juntos Podemos presidential ticket.

Why did Piñera win?
The Concertación is probably 25% correct that its lacklustre candidate, chosen by party bigwigs without a proper primary, contributed to its defeat. A second reason for its defeat was that Enrí­quez-Ominami's scratch campaign reinforced the perception of Frei as the candidate of the party machines. A third reason for Piñera's win was that, as he himself argued, Chileans want the country to be a proper democracy, with alternation of power. A fourth and final reason was that Piñera ran a lavish campaign. Final campaign account figures show that Piñera, a billionaire, outspent all the other contenders combined. He spent Ch$5.08bn (US$9.6m), of which US$2.07m came from his own pocket. According to the official figures, Piñera's total spending was only Ch$3m (US$5,660) below the statutory maximum. Under Chile's electoral system, the state reimburses candidates according to their share of the vote. The other three candidates spent a total of Ch$4.84bn (US$9.1m).

Congress
Although Piñera, running on the Coalición por el Cambio ticket, won 44% of the votes cast in the first round his own party, Renovación Nacional (RN), will very much be the junior partner of the more rightwing Unión Demócrata Independiente (UDI) in congress. The UDI received 1.5m votes, more than any other party.

The Coalición has 58 seats in the lower chamber, just three seats short of a majority, which it could obtain with the support of the Partido Regionalista de los Independientes (PRI), which won three seats. The head of the PRI, Adolfo Zaldí­var, is most likely to side with the Alianza. Zaldí­var, who was once a big-hitter in the Concertación and proposed Bachelet's candidacy, was expelled from Democracia Cristiana (DC) in December 2007. 

Inside the Concertación, the DC replaced the Partido por la Democracia (PPD) as the biggest party in the coalition: it took 19 seats in the lower chamber, recovering four of the five seats it lost when Zaldí­var was expelled and took his supporters, known as colorines, with him. The biggest loser was the Partido Socialista (PS). Despite being the party of the hugely popular Bachelet, it was made to pay for the desertion of both Enrí­quez-Ominami and Arrate. 

• Chile's new look congress (Brackets denote previous composition)

Parties	Deputies	Senators
Concertación and Juntos Podemos	57 (65)	19 (20)
Democracia Cristiana (DC)	19 (20)	8 (6)
Partido por la Democracia (PPD)	18 (21)	4 (4)
Partido Socialista (PS)	11 (15)	4 (8)
Partido Radical Social Demócrata (PRSD)	5 (7)	1 (3)
Partido Comunista (PC)	3 (-)	-
Independent but affiliated	1 (2)
Coalición por el Cambio	58 (54)	16 (17)
Unión Demócrata Independiente (UDI)	37 (34)	9 (9)
Renovación Nacional (RN)	18 (20)	7 (8)
Independent but affiliated	3
Partido Regionalista de Independientes (PRI)	3 (-)	-
Independent and unaffiliated	2 (1)	3 (1)
Total	120	38

The first round result in the presidential election

Candidate	%	m votes
Sebastián Piñera	44	3.07
Eduardo Frei	29	2.06
Marco Enrí­quez-Ominami	20	1.4
Jorge Arrate	6	0.4
Registered but did not vote	0.6	0.6
Null and blank	0.3	0.3

NB: percentage is of total votes cast for candidates
Source: Official figures from the Tricel

• The other change in the new congress is the return of the Partido Comunista (PC), which won three seats as part of the parliamentary alliance between the Concertación and Juntos Podemos. It is the first time in 36 years, since President Salvador Allende was overthrown, that the PC has been represented in congress.

 

• Campaign spending

The campaign finance system led to the fourth candidate for the presidency, Jorge Arrate, being eligible for Ch$300m in state funding even though his campaign only spent Ch$167.3m.  Arrate and Enrí­quez Ominami were knocked out in the first round on 13 December 2009.

The long awaited summit meeting between President Vicente Fox and the mayor of Mexico City, Andrés Manuel López Obrador, failed to achieve anything. Indeed, less than a week after the meeting on 29 September, supporters of López Obrador and the Partido de la Revolución Democrática were making a nuisance of themselves in congress. The protesters who interrupted congressional business claimed that the federal government is now prodding congress into cutting the budget for Mexico City in order to undermine support for López Obrador.

President Vicente Fox made his antipathy to the mayor of Mexico City, Andrés Manuel López Obrador, all too apparent only a day after what was supposed to be their clear-the-air meeting on 29 September. Fox said that repeating a lie does not make it the truth. As one gleeful senior politician from the Partido Revolucionario Institucional, the biggest party in the country and congress, put it, all the long-awaited meeting produced was a photograph.

President Fox's phrase about repeating lies not changing anything came in response to another claim by López Obrador that Fox had interfered in the legal action that was being taken against him. Fox adamantly denies this, though his attorney general and interior minister admit meeting the president of the supreme court to discuss the legal action against López Obrador.

López Obrador all but called Fox a liar at his regular (6am) press conference on 30 September when he gave his considered view of the 29 September meeting with the president. López Obrador said that he could not rely on President Fox's promise to act honestly and impartially over the issue of why the government was seeking to strip him of his immunity from prosecution in order to try him for presumed contempt of court. López Obrador said Fox had his views that the mayor respected but that they did not tally with his own opinion on the issue.

López Obrador is being prosecuted for flouting an injunction that would have prevented the compulsory purchase and subsequent use of a property, El Encino, to improve public access to a hospital. López Obrador believes that the court action was the final element of a year-long plot by the federal government to undermine him. He is, according to the opinion polls, the favourite to succeed Fox as president in 2006. If he loses his immunity and then is found guilty of contempt, he will be unable to stand for the presidency.

The Mexico City mayor brought up this issue of the prosecution during his meeting with the president. Fox's denial of government involvement in the prosecution, for political ends, verged on the slippery. López Obrador said to Fox that it seemed to him that there had been a campaign for the past year to knock him out of the presidential election for 2006. According to López Obrador, Fox replied by saying that was not the intention of the government. Fox's awkward, indirect phrasing was odd, even for Mexicans who delight in periphrasis.

It is clear that the mayor is deliberately stoking up the row between himself and the president. His complaint about Fox's interference in the attempt to strip him of his immunity was made in a long letter, dated 28 September, written before he went to see Fox, but published afterwards. The letter is mostly a protest about a congressional committee's decision in the penultimate week of September not to accept his application to call President Fox and some of his ministers to testify to congress. This committee also rejected 22 of the 71 pieces of evidence produced by the mayor of Mexico City in his defence. López Obrador had wanted to call and question Fox, two of his ministers and the president's former private secretary to testify on the issue.

A congressional committee is currently considering whether López Obrador should lose his immunity from prosecution. López Obrador argues that the case against him has been concocted by the government and this is why he wanted to question the president.

The saga is likely to continue, not least because the PRI, which can only profit from the row, is also determined to keep the issue bubbling in congress. López Obrador's latest move was to send another letter to the congressional committee, arguing that its failure to accept his right to call the president to testify broke the constitution because the case was clearly political.

Deals in the air?

The decision by the congressional committee not to call Fox and his ministers in the López Obrador immunity hearing was passed by three votes to one. The only dissenter was from López Obrador's Partido de la Revolución Democrática. The key votes are held by Prií­stas, who hold two. The PRI is blocking López Obrador's attempts to make his defence in front of the whole Cámara de Diputados. Neither of the two ministers whom López Obrador wanted to call is known for political adroitness. One or both of Santiago Creel, the interior minister, and Rafael Macedo de la Concha, the attorney general, could easily have blurted something out which would have given another twist to the row. Meanwhile, Fox's former private secretary, Alfonso Durazo, has been remarkably quiet since resigning in May and publishing a 20-page resignation letter which virtually accused Fox's wife Marta Sahagun of preparing to run for the presidency in 2006. It was only two months before Sahagún surprisingly announced that she was not going to run for the presidency, following the crisis detonated by Durazo's resignation, that the government started a court action, on 19 May, to strip López Obrador of his immunity. The pettiness of the charge, that he had ignored an injunction from a court to prevent the destruction of property, indicated to all bar the most bigoted adherents of President Fox that the move was political. López Obrador was well above Sahagún in the opinion polls for 2006.

Supreme court
López Obrador and the PRD has been trying to make political capital from the fact that President Fox and his ministers discussed the issue of López Obrador's immunity with the president of supreme court. The meetings with the supreme court began as long ago as 6 April this year, well before the decision to prosecute López Obrador and remove his immunity was taken. The government's line is that it realised that the case was political dynamite and it wanted to see if there was any way in which the court action could be avoided. The meetings concluded that there was no way of dodging the court action.

The bumbling president of the PRD, Leonel Godoy, said on 19 September that if the president of the supreme court had discussed the issue of the legal immunity of the mayor of Mexico City with President Vicente Fox, he should resign. Godoy was reacting to confirmation by the Procurador General de la República, Rafael Macedo de la Concha, on 15 September that the issue of whether López Obrador, should lose his immunity from prosecution had been discussed by both politicians and legal officials at a meeting with the president. 

Godoy called for the president of the supreme court, Mariano Azuela, to say what issues he had discussed with President Fox. Separately, Ramundo Cárdenas, a PRD leader in the senate, said that he would push for a public explanation from the supreme court justice about what is going on. He said that all Mexicans knew that a lot of verdicts could be bought and soldthat it was clear that Azuela had acted politically. 

López Obrador rather embarrassed his colleagues when he admitted, on 3 October, that he too had met Azuela. He claimed that these meetings had taken place last year, long before the start of the attempt to prosecute him for contempt. López Obrador said that the last time he met Azuela was in March this year. Some of López Obrador's team, notably Mexico City's attorney general, Bernardo Batiz, have implied that López Obrador's meetings with supreme court justices to exchange views were pretty regular. López Obrador has denied that he even discussed particular cases with Azuela. Azuela, however, is reported to have warned López Obrador last year that he risked a contempt action over El Encino. 

Academic lawyers were horrified by the government's meetings with Azuela. They said that it was very serious that the division between the executive and the judiciary was being blurred. Raúl Carrancá y Rivas, a legal expert, said that the meetings between Fox, his ministers and the legal officials were a mistake.

• Mexico City assembly members from PRD brought the federal congress to a halt on 5 October and threatened to do it again on 7 October. The PRD politicians are drawing attention to the long-running spat between the federal government and the mayor of Mexico City, Andrés Manuel López Obrador. The perredistas occupied congress for 18 hours, much to the annoyance of the other parties in the chamber. The PRD wants congress to throw out the government's attempt to strip López Obrador of his immunity from prosecution. 

The PRD also wants to stop the federal congress from chopping the education budget for Mexico City. The PRD is calling for a massive rally on 7 October to intimidate congressmen into dropping this proposal. Congress is also musing over cutting M$9bn (US$782m) from the city's budget. The PRD argues that the federal congress's determination to clip the budget for the capital is another side of the government's plan to undermine López Obrador. 

• President Vicente Fox held the first of his meetings with political leaders on 22 September. The initial meeting was with the leader of the Partido Revolucionario Institucional (PRI), Roberto Madrazo. The meeting was apparently cordial and focused on economic issues. The two men talked about how they might work together. Crucially, Madrazo was accompanied by the PRI's president of the lower chamber, Manlio Fabio Beltrones, and the party's two leaders in the two houses of congress: Emilio Chuayffet in the lower house and Enrique Jackson in the senate. Some of the good done by this meeting may have been squandered by an inept statement from the minister of energy in congress on 22 September. 

The minister, Fernando Elizondo, said that there was corruption in congress. Beltrones warned Elizondo either to produce clear evidence so that an investigation could be launched, or to shut up and stop making unsubstantiated accusations. Elizondo lost his temper when he came under hostile questioning over the controversial multiple service contracts, which allow foreign companies to help to develop the country's (nationalised) gas fields. A populist deputy, Jesús González Schmal, from Convergencia, said that congress was asking the courts to declare the contracts null and void because they damaged the national interest.

November was a ghastly month for violence in Mexico. It opened with bombs exploding in three locations in Mexico City on 6 November, was followed by an ambush which killed six policemen in Michoacán and took in a bloody prison riot which left five people dead. In addition, drug gangs continued to pick off their enemies, police chiefs and occasionally, local politicians.  

The president-elect, Felipe Calderón Hinojosa, admitted on 16 November, before the prison riot, that current levels of violence in Mexico were "alarming". The current attorney general, Daniel Cabeza de Vaca, said that the country was "on a crest, a peak of violence". Calderón promised to take measures to impose peace when he takes office on 1 December.

What he can do to make an immediate difference is far from clear. The obvious option is to reverse President Vicente Fox's decision to ease the army out of anti-drug operations and once again deploy the army against the drugs gangs. The arguments for doing this are persuasive. The drug gangs are, invariably, better equipped than the police and the two main gangs, the Cartel del Golfo and the Cartel de Sinaloa, both employ former soldiers to do their dirty work. The main argument against deploying the army is the temptation it puts in the way of soldiers. President Ernesto Zedillo (1994 to 2000) said that his worst day in office was when he realised that General Jesús Gutiérrez Rebollo, Mexico's top anti-narcotics officer, was in the pay of a major drug-trafficking gang, the Cartel de Juárez. Gutiérrez Rebollo was arrested in February 1997.  

Longer term, Calderón seems certain to try to reorganise the country's various police forces. President Vicente Fox has done a bit of this, especially in his México Seguro plan of 2004, which replaced the worst state police forces first with federal police and then with fresh state policemen. Fox's problem is that his core federal police force, the Policia Federal Preventiva (created by Zedillo), which has a lot of former soldiers in it, is prone to outbreaks of ill-disciplined violence, most notably when suppressing protests in Atenco, the Estado de México in May this year. An investigation by the Comisión Nacional de Derechos Humanos accused 67 of the 628 PFP policemen in the operation of human rights abuses. To be fair, the 4,500 PFP men who restored order in Oaxaca on 29 October, maintained their discipline despite facing petrol bombs, stones and lumps of wood as they marched into the centre of the city.  

Calderón seemed genuinely upset by the current wave of violence. Almost all of the violence is part of the vicious war between drug gangs. President Fox's policy of going after drug barons does not seem to have halted the flow of drugs across Mexico and into the US but it has increased the drug-related violence in Mexico. Decapitated gangs fight between themselves, or with other gangs, for control of the lucrative drug trade. Increasingly, the gangs are picking off anyone who stands up to them or crosses them.  

The worry for the authorities is that the seething criminal violence may turn into violent political unrest. This has not happened, so far. The five-month confrontation between the state government of Oaxaca and the Asamblea Popular de los Pueblos de Oaxaca (APPO) only flared into sporadic violence: the arrival of the PFP on 29 October appears to have dampened down the problem, though the increasingly truculent behaviour of the governor, Ulises Ruiz, means that more violence could erupt at any time. On 26 November, Ruiz managed to walk the streets of central Oaxaca for the first time since the protests against him started in May. Simultaneously, the house of a prominent APPO leader was torched.

Bombs

The bombs which exploded on 6 November appear to be the work of old, rather than new, guerrilla groups. This is what the Procuradurí­a General de la República (PGR) concluded on 8 November, despite the fact that five new guerrilla groups had claimed responsibility for the bombs that went off in three different places in Mexico City. The PGR's conclusion, however, does point to a change in tactics by the known guerrilla groups, the Ejército Popular Revolucionario (EPR) and the Ejército Revolucionario del Pueblo Insurgente (ERPI). The security minister, Eduardo Medina-Mora, also argues that as the bombs exploded soon after midnight and were clearly designed to damage property rather than to kill, they were not the work of terrorists.

The country's two most prominent guerrilla groups, the EPR and the ERPI, have been around for at least 10 years. They have operated mostly in the south of the country, particularly in Guerrero, which was the bloodiest battleground in Mexico's Dirty War in the 1970s and 1980s. What neither group had managed to achieve, until 6 November, was to set off bombs simultaneously in Mexico City. According to the Mexico City security chief, Joel Ortega, the bombs were set off by timers.

The bombs in Mexico City were followed by explosions and alerts across the country. Bombs went off in Ixtapa, Guerrero on 7 November, just before a visit by the President-elect, Felipe Calderón Hinojosa. On 8 November, explosives were found in Celaya, Guanajuato. Some security experts suggest that a team of at least 20 was needed to place the bombs that went off in Mexico City. The other bombs suggest that the guerrillas' "reloading capacity" has increased dramatically. Previously the EPR and the ERPI would go months, if not years, between attacks.  

The guerrilla group that claimed responsibility for the 6 November bombs claimed that it had in fact placed eight bombs: two at the headquarters of the Partido Revolucionario Institucional; two at the Tribunal Electoral del Poder Judicial de la Federación and another two at a branch of Scotiabank ( which was completely destroyed). One bomb failed to go off at a Sanborns and another failed to go off at a different Scotiabank branch.  

The group which claimed responsibility, the Coordinación Revolucionaria (CR), said that it would continue with the attacks against institutions and 40 national and multinational companies until Ruiz resigned. The CR said that it was representing five groups: Tendencia Democrática Revolucionaria-Ejército del Pueblo (TDR-EP); Movimiento Revolucionario Lucio Cabañas Barrientos (MRLCB); Organización Insurgente 1 º de Mayo; Brigada de Ajusticiamiento 2 de Diciembre and Brigadas Populares de Liberación (BPL).

The apparent start of a bombing campaign prompted Mexican politicians to criticise the government. Congressmen claim that there have been failings by the intelligence services. To underline their unhappiness with the government, the two opposition parties, the Partido de la Revolución Democrática and the Partido Revolucionario Institucional, plus their allies, united on 7 November to vote against allowing President Vicente Fox to visit Australia and Vietnam (for the Apec summit). Congress has to approve all presidential foreign trips and usually approval is automatic. The congressional vote is doubly significant because this trip was Fox's last as president.  

The attacks in Mexico City were prefaced by warnings. On 20 October a group of unidentified guerrilla leaders held a press conference 'somewhere in the state of Guerrero', where they ratified their commitment to joint action against "repression in Oaxaca". The government ignored this challenge and sent in 4,500 federal police to restore order in Oaxaca City on 29 October.  

The Michoacán prison riot

Four lawyers and a prisoner in a jail in Michoacán were killed on 18 November as the Agencia Federal de Investigación stormed the jail. Michoacán, home state to the president-elect Felipe Calderón Hinojosa, but run by the leftwing Partido de la Revolución Democrática, has seen a huge increase in its murder rate this year, mostly related to the drug trade.  

The authorities claim that the AFI only went in after the four prisoners, who took 15 lawyers and one guard hostage early on the morning of 17 November, started shooting their remaining hostages. The AFI then stormed into the prison. Two other lawyers were wounded as were four other prisoners. The prisoners took the hostages after they were told, while they were still in the prison-visiting area, that they had been sentenced to 40 years for kidnapping. The hostage takers had a couple of pistols. They released four lawyers and a prison guard at 4pm on 17 November, after a round of negotiations. Another two people were released on the morning of 18 November.  

On 6 February Arturo Sarukhán, Mexico's ambassador to the US, called on the new US president, Barack Obama, to adopt a broad stategy of engagement with Mexico in order to restore the influence which he claimed the US had lost in Mexico.

Sarukhán was commenting on a 72-page report from the Woodrow Wilson International Center for Scholars. The report was entitled: The United States and Mexico: Towards a Strategic Partnership. The report indeed calls for a more strategic approach to common problems. It argues that there is plenty of day-to-day conatct between agencies and governments (both federal and local) on both sides of the border, but frequently the discussions just address single facets of a problem rather than the whole issue. The report argues that a more coordinated approach could pay off over a range of issues, from energy through migration to combating organised crime.

It is worth noting that energy is an extremely tricky issue for Mexico. The state still has a monopoly over oil exploration and production and the courts have banned successive governments' backdoor attempts to allow the private sector to play a bigger role in the electricity industry. The energy chapter of the Nafta treaty is short and specific: all electricity publicly consumed in Mexico has to be supplied by the Federal Electricity Commission, which sets the prices for private generators. Whether foreign investors would be interested in developing alternative energy supplies under these conditions must be doubtful.

The report springs from the musings of four working groups set up last year. The working groups looked at four issues: security cooperation, economic integration, migration and border management. The Center stressed that none of the participants in the working groups necessarily endorsed all the suggestions or indeed even what their particular working party produced. I targued that it was developing policy options which needed to be properly designed before being implented. The Center also recoiled from the idea that it was advocating a particular policy or set of policies.

In the introduction, the report highlights the problem of drug trafficking gangs in Mexico. The report endorses, broadly, the Mexican argument that the US demand for illegal drugs provides the cash that allows the gangs to arm themselves with increasingly powerful weapons. The Center estimates that the gangs have a cash inflow of between US$15bn and US$25bn a year.

The second big issue in the report is the integration of the two economies. Mexico is the US's second biggest export market (after Canada). The third issue is immigration: a third of all US immigrants come from Mexico. Over 10% of Mexico's population lives in the US and 3% of the US population was born in Mexico.

What is interesting and significant about the report is that it is realistic. It accepts that the Obama administration has more urgent priorities than Mexico and that it cannot commit much money now to supporting policies south of the border. Nevertheless, it makes a couple of modest suggestions that could deliver substantial medium-term benefits. One of these is to allow some Mexican hospitals to become eligible to provide Medicare treatment. This would inject some much needed price competition into the US healthcare industry.

Another is to cooperate on developing biofuels and alternative energy. The problem with this is the role of the Mexican state in the electricity industry. A third is to create a development fund, presumably along the lines of the European Investment bank, to help develop major economic regeneration projects in economically depressed regions of all three Nafta members.

The report argues that a comprehensive immigration reform in the US would create a huge amount of goodwill in Mexico that would allow the two governments to start tackling trickier issues such as enhanced forms of security cooperation.

Sarukhán argued that the report was important if only because it contradicted the growing assumption among some in the US that Mexico was either already a failed state or about to become one. Sarukhán argued that US governments did not usually even think about entering into agreements with failed states. “One cannot construct strategic relationships with failed states." Sarukhán asserted.

Sarukhán himself had some input into the report and broadly endorsed it. He argued that a sensible immigration reform in the US was crucial and the US should resist the protectionist pressures that are erupting as the recession starts to bite. Sarukhán claimed that 300,000 Mexicans were still crossing into the US every year to work. When the US economy was booming 500,000 crossed the border every year.

It is worth noting that on 4 February President Felipe Calderón Hinojosa telephoned the prime minister of Canada, Stephen Harper, to discuss the protectionist moves in the US. The two leaders agreed to oppose any such moves and said that the way forward should be to improve competition in the Nafata region. It is far from clear, however, what this means or how it would work.

What the North American economy needs at the moment is demand to replace what is being lost as US citizens learn to live within their means. To be fair, Calderón also highlighted the ways in which the Mexican and Canadian counter-cyclical economic packages coinicided.

Jeffrey Davidow, a former US ambassador to Mexico, who also had some input into the report, argued that the Obama administration should try to avoid focusing its Mexico policy around one issue. In the 1980s and 1990s the key issues were drugs and economic stability. In the 2000s, immigration to the US was the dominant bilateral issue. Now, he said, both countries had to resist the temptation to focus just on security. He suggested that both governments should set up a commission to evaluate Nafta but neither should comit themselves to renegotiating the agreement. He said that the commission should look at what Nafta had achived and where it has fallen short. It is not clear whether Canada should also be included in the commission, in Davidow's view.

Denise Dresser, a political scientist at the Instituto Tecnológico Autónomo de México (ITAM), another of the report's contributors, argued that Mexico has become a state at bay (“acorralado" was the word she used), where the government has become unable, at several levels, to discharge its basic responsibilities such as protecting life and property. She said that President Calderón has to contend with a corrupt police force, an army that is all-but out of control, a deficient judicial system and a penal system that is, effectively, run by criminal gangs.

Dresser asserted that the US's Iniciativa Mérida, designed to help Mexico overcome these issues, was not sufficient to make a difference, given the size and scale of the problems.

• Securing Mexico for the US
  Another of the Woodrow Wilson contributors, Lázaro Cárdenas Batel, the grandson of Mexico's greatest 20th Century president, Lázaro Cárdenas de Rio, and like his father and grandfather, a fomer governor of Michoacán, used a similar phrase to Calderón in describing the security issues that confront the US and Mexico. Cárdenas said that the “security of its neighbours is the security of the US". Calderón's phrase was: “I think the safer Mexico is, the safer the US will be."
  

On 28 March the mayor of the municipality of Garcí­a in Nuevo León, survived a second attempt to assassinate him in little more than a month.

The mayor, Jaime Rodrí­guez, did lose another bodyguard, while four others were wounded. Rodrí­guez said that on the second occasion more than 40 gang members tried to kill him and take on his eight bodyguards.

Rodrí­guez habitually travels in an armour-plated vehicle, with another car transporting four of his eight-person bodyguard. The bodyguards' vehicle is not reinforced.

What makes the attacks on Rodrí­guez significant is that he hails from the main opposition Partido Revolucionario Institucional (PRI) which, according to President Felipe Calderón, used to have 'an understanding' with the main gangs when in power (either at the state or federal level) to look the other way when the gangs wanted to move a consignment of drugs.

The municipality of Garcí­a is a suburb of Monterrey, where gang violence has increased dramatically in the past 18 months.

On 25 Febuary Rodrí­guez reported that three gangsters had tried to kill him. Spookily, both assassination attempts came while he was driving along the Avenida Lincoln into Monterrey. In the first attack, the mayor's bodyguards killed three of the attackers.

Rodrí­guez assumed that the people trying to kill him worked for Los Zetas. This is one of the gangs which is fighting to keep the Sinaloa gang out of Monterrey. The Sinaloa gang, according to some security experts, is favoured, perhaps unwittingly, by the federal government, the fedral police and the army. The federal government denies this and argues that the bulk of the gang killing in Mexico is the result of turf battles between gangs.

Cassez: The supreme court has agreed to consider the case of Florence Cassez, a Frenchwoman who has been sentenced to 60 years in Mexican jails for kidnapping and gangsterism. Her conviction, and Mexico's refusal to allow her to serve her sentence in France, has led to a diplomatic row between France and Mexico.

Swine flu: On 24 March the state government of Chihuahua, on the border with the US, issued an alert after a police officer died after contracting the influenza H1N1influenza virus. Two other people have the disease and 15 others may also have it. The state governor, César Duarte, said that it was important that people realised that the state was not facing a pandemic, as the country did two years ago. He did say, however, that the state government was introducing security measures to prevent the spreading of the virus.

Duarte suggested that the 'flu originated in El Paso, Texas, where there have been 29 confirmed cases of influenza A, of which H1N1 is a variant, this year. He has ordered the vaccination of 250 border agents.

Separately, the same virus appears to have broken out in Caracas, Venezuela. There, the health minister, Eugenia Sader, said that 179 people may have the virus; two people died in Mérida, where schools have been closed.

Military service: César Duarte, the governor of Chihuahua, was slapped down by both federal and local politicians after suggesting that young men who were either unemployed or not studying (the so-called ni-nis) should be conscripted into the army. Chihuahua is by far the most violent state in Mexico. So far this year, 522 of the 2,866 people killed in gang-related violence in Mexico have been killed in the state.

The opposition Partido de la Revolución Democrática (PRD) is experiencing tough times. In late November, President Leonel Fernández announced that he was going after ten high-ranking officials of the Mejí­a administration on corruption charges. In early December, a survey of PRD party members revealed that there was deep disillusionment with the party hierarchy.

Arrest warrants were issued on 18 November for the ten officials, including former interior minister Pedro Franco Badí­a, former armed forces chief Ramón Emilio Jiménez and former presidency official Siquió Ng de la Rosa. They were charged with having embezzled about US$33m through Plan Renove, a scheme designed to improve public transport and to encourage the renewal of the country's car fleet but which ended up assigning cars to officials and allies of the PRD. The officials were released days later but Fernández insists that corruption probes into the Mejí­a administration will continue.  

PRD shake-up
If the results of a survey of PRD members are taken on board, the party could suffer further convulsions. The survey, carried in the daily El Caribe, showed that 68% of PRD members want the party leadership to be renewed. A total of 64% of the 40,629 respondents attributed the electoral defeat in May 2004 to party infighting and 51% to the decision to allow re-election, which split the party. Former president Hipólito Mejí­a outmanoeuvred his main rivals, including vice-president Milagros Ortiz Bosch and tourism minister Rafael Suberví­ Bonilla, for the PRD candidacy, but not without alienating much of his party and the grassroots.  

Only 28% of the people polled said that they were satisfied with the leadership of the PRD. A total of 68% of respondents also cited clientelism, political patronage and corruption as harming the PRD. The party president, Vicente Sánchez Baret, resigned in protest at the findings. He later said that he had taken the decision in the heat of the moment and returned to his post.

ECONOMIC OVERVIEW: DOMINICAN REPUBLIC

President Leonel Fernández claims that the country is now getting out of the economic crisis which has afflicted the country for the past four years. He pointed out that since he took office it has strengthened from RD$42 to RD$28 to the dollar. When the crisis was at its worst, the peso was trading at RD$58 to the dollar. The IMF, which the government had hoped would sign a contingency agreement at the beginning of December, agreed an outline deal but still has to put pen to paper. Ministers are becoming increasingly keen that it does: the finance minister, Vicente Bengoa, said on 3 December that any deal with the IMF would limit the government's freedom of action over the next couple of years. Bengoa said that borrowing under the Mejí­a government accounted for US$7bn of the country's US$10.5bn foreign debt. Servicing this debt would cost, Bengoa said, US$2.1bn in 2005. The IMF will provide an immediate loan of US$1bn when the contingency agreement is signed, Bengoa said. Outlook The IMF had wanted the government to cut spending in 2005 and produce something approaching a balanced budget. The budget sent to congress on 30 November came to RD$207bn (US$5.59bn). The government is forecasting that growth in 2005 will be 2.5%; inflation will come down to 13.5%; and an average exchange rate for 2005 of RD$37.

On 11 April a long-running maritime boundary dispute between Barbados and Trinidad and Tobago was settled by a court for international arbitration based in The Hague. Both countries claimed the ruling as a victory, but the court claimed it lacked jurisdiction to arbitrate on one of the most contentious issues: the right of Barbadian fishermen to fish in Trinidad and Tobago's waters. This could mean the dispute between two founding members of Caricom will flare up again in the future.

Barbados began arbitration proceedings at the International Dispute Resolution Centre in February 2004 following a diplomatic row between the two countries after coast guards from Trinidad and Tobago arrested two Barbadian fishermen and charged them for fishing illegally in Trinidadian waters. Coupled with this was Barbados's irritation with Trinidad and Tobago for allowing a gas pipeline it was building to Venezuela to encroach on Barbados's exclusive economic zone.

Energy

The court established a median line representing the half-way point between the two exclusive economic zones of Barbados and Trinidad and Tobago. The Barbados Advocate said that the ruling also allows Barbados to exploit hydrocarbon resources up to 150 nautical miles beyond the line. 

The Barbadian energy minister, Elizabeth Thompson, said that the decision had expanded the country's economic viability. "Now that we have access to a much larger marine space, it allows us to put out that space for bids by international companies to exploit hydrocarbon resources. That makes us very attractive to a number of companies," she said.

Fish

The Barbadian deputy prime minister, Mia Mottley, said the ruling was exactly what Barbados had sought and the court had only made a slight variation to what her government had said should be the boundary line between the two nations. The Trinidadian media, however, claimed the court had "rejected each and every claim" made by Barbados and drew attention to its neighbour's failure to secure fishing rights for an area south of the median line which Barbadians regard as its traditional fishing ground.

Crucially the court did not rule on the precise rights that the exclusive economic zones confer on the countries. Instead it stated: "Trinidad and Tobago and Barbados are under a duty to agree upon measures necessary to coordinate and ensure the conservation and development of flying fish stock, and to negotiate in good faith and conclude an agreement that will accord fisherfolk of Barbados access to fisheries within the Exclusive Economic Zone of Trinidad and Tobago." The prime minister of Barbados, Owen Arthur, says his government will move urgently to conclude these fishing negotiations with the twin-island republic.

Three weeks after promising the country's media owners a "fight with no quarter given" on 6 May, President Manuel Zelaya went to war. On 28 May he ordered 10 media channels to broadcast government propaganda for two hours a day. He said he was left with no option because the media was responsible for putting out "misinformation", sensationalising violent crime and neglecting to report on his government's many achievements.

Zelaya announced his plan while inaugurating a water-treatment plant in the Caribbean coastal city of La Ceiba. He said the plant provided an archetypal example of his government's many 'positive' projects which, he claimed, the media has completely ignored. The broadcasts were designed to showcase the government's achievements by showing interviews between "journalist friends" and Zelaya and his cabinet ministers. The first government broadcast on 28 May, called The Forum of the People, was similar to Aló, Presidente of Venezuela's President Hugo Chávez , with Zelaya appealing to Hondurans to come together to solve the country's problems.

Zelaya's decision was severely criticised by the Colegio de Periodistas de Honduras (CPH), which said that governments representing democratic countries around the world only resorted to broadcasting on private television channels when national sovereignty was at risk. The opposition Partido Nacional also criticised his decision.

In the face of this criticism, Zelaya backtracked slightly and on 28 May announced that television and radio stations would have to show fewer hours of government propaganda than he had previously ordered: one hour every Monday and Friday until the end of June.

• Prize-giving
  Ironically, on the same day he made his media announcement, President Manuel Zelaya attended a prize-giving ceremony of the Asociación de Prensa Hondureña (APH) as a special guest to celebrate the Day of the Journalist.  

Zelaya presented a prize to José Marí­a Leiva Leiva, a columnist for the national daily La Tribuna, who promptly said that in his opinion the political class was responsible for all the problems in the country, that no government could change this and it was his duty to report it.