The LatinNews Podcast

Richard Lapper is a writer and consultant, specializing in Latin America. He has extensive experience as a journalist in the region and is a research affiliate at King’s College, London.

Richard is author of ''Beef, Bullets and Bible: Brazil in The Age of Bolsonaro'' published in June 2021 by Manchester University Press.

He worked for the Financial Times for 25 years, occupying the post of Latin America editor between 1998 and 2008. He was a principal at FT Confidential between 2010 and 2015, an FT information service for investors.

He has written and broadcast widely on Latin America and Southern Africa and spoken at a range of international conferences.

Intro: Welcome to the LatinNews Podcast, a fortnightly deep dive into key developments from across Latin America and the Caribbean. Here's your host from Bogotá, Colombia, journalist Richard McColl.

Richard McColl: This is the LatinNews Podcast. I am Your host, Richard McColl here in Bogotá, Colombia. Our very special guest has been on the show before. We've got none other than Richard Lapper. He's a writer, journalist, author of books on Bolsonaroo and Lula and another book coming out next year, 2026, as yet untitled, because we are watching events in Brazil and of course, he's going to have to update it, I think daily at the moment. Richard, welcome back on the LatinNews Podcast.

Richard Lapper: Thank you. Nice to be on it again.

Richard McColl: Yeah. Well, it's a great pleasure for us to be chatting about Brazil because, well, in this part of the world, we're watching a lot of news coming out of Brazil and, well, world events seem to be pointing at more uncertainty and instability in the country. Perhaps you could give us a little bit of a background of what's going on.

Richard Lapper: Okay. I mean, just very briefly, you know, Lula came back to office to begin his third mandate at the end of 2022. He took office in 2023, in January amid leading a very broad alliance, anti Bolsonaroista alliance, a democratic alliance, as it was portrayed. And its first move was to quash a attack, a potential. An attempted coup, really, against the Lula government by supporters of Bolsonaroo. And since then, we've had. Lula's now been in office two years and the economy is doing okay. I mean, the growth in 2024 is edging nearly 4%, one of the fastest growing economies in the region. Unemployment's been down to its lowest level for 10 years or so, maybe more, actually, since 2012, I think. But despite that, things do not look good. And the government's popularity is very much on. The Wayne 3 polls published over the course of the last two to three weeks, and they all show a very sharp fall in the government's ratings and Lula's popularity. It hitherto, over the past few months, there's been, you know, smaller drops, but this is a different order of fall. I mean, we're looking at a fall of around 10 percentage points and higher in some northeastern states, which at the end of the day are Lula's stronghold. You know, Lula won the election in 2022 because he runs so convincingly in the poorer northeastern states of places like Bahia and Pernambuco. And that's where his support is. Ebbing fastest.

Richard McColl: Well, this sounds incredibly concerning, but you say that, you know, the economy is not doing too poorly and unemployment is down to. What can we, you know, what can we relate. This drop in his popularity, especially in his stronghold.

Richard Lapper: So I think there are two or three reasons, Richard. There is a. The government's missteps has made various missteps. It's made mistakes. One of the biggest mistakes was to introduce. It's quite a technical thing really, but I'm going to start with it because I think it could be. I'm not going to go into. I'm not going to talk a lot about this, but I think it's worth mentioning was a kind of very minor tax measure. Really not a tax measure. The government was simply. Brazil has an electronic payment system that thousands and thousands of Brazilians have begun to use. They become bankerized through it. I mean, lots of poorer people who didn't have bank accounts before now make payments with their mobile phones is something called Pix. So if you want to make a payment for your nails to be cut or filed or whatever, you pay your 20 reais on your phone and you can pay the person who's the, who's doing your, you know, the work for you. And if you want to, it's, it's very widely used and it's very popular because it's very quick. Banks in Brazil are quite bureaucratic and this is a great way to make it work. The government. Some point at the beginning of January, it became clear that the government was going to monitor these transactions. And this gave rise to a social, to a WhatsApp message from a Bolsonaro deputy alleging that they were going to tax these transactions. And this went viral and it certainly contributed to a very sharp fall in the government's popularity. So that was one thing. And that might have been, in a way, the straw that broke the camel's back. Because before that, hitherto there being several concerns. In October, the government fought local elections, municipal elections for several thousand mayors. It had been seen as an essential paving stone for the big presidential election next year. And the government. I talked to lots of people from the PT before the elections over the course of the last 12, 18 months. And everyone told me this was going to be a really important test for the PT. They really, they'd done very badly in 2020 at the last time these elections were held. And so they really had to do well in October. And in fact, what happened was they did very badly again and the parties that did better and really did triumph, really were that were the parties of the center and the center right, which are known in Brazil as the Centrão, the Centrão. They did well. They swePT the board. So that was another. That was a bit of a setback. But beyond that, the really big issue, I think that's been, has been bubbling away. Inflation's been, although you say high inflation, I mean, compared to someone like Argentina or Venezuela in the past, inflation's not that high. It's still between 4 and 5%. But what's happened is that food prices are rising very quickly. So although inflation in the most recent reading is something like 4.5% in January of 2025, in the supermarket, prices are increasing at a rate of more than 7%. And that average rate disguises the fact that some food items have increased very rapidly indeed. May remember that back in 2022, when Lula was fighting his election campaign, he promised poor people in Brazil that he would bring back to their dining tables the picanha, this very fake, this cut of steak that Brazilians really like. And he'd said that. And in fact, what's happened is that the price of picanha has become even more unaffordable than it was before. Meat prices are up by more than 25% over the past 12 months. The price of things like eggs has gone through the roof. Coffee prices have gone up by more than 60% in the last 12 months. So a whole number of things. Now this is. Why are prices rising so much, you ask? And the answer to that is that Brazil's currency has become much weaker against the US dollar. So at the end of 2023, currency trading at about just under 5 reais to the US dollar. By the end of 2024, the value of the real had deteriorated over the course of the year by about 20%. And in the last three months of the year, it was really in free fall. It went down to 6.30. That was the highest the real reached, or the lowest it reached, rather, it's come back a bit since then, but not by much. Basically what's happening is that the costs of imports are rising. And the food that Brazil exports, which is priced in dollars, because so it's, you know, farmers are. Farmers are not, you know, not charging a different price for the internal market. Those prices have risen very appreciably. On top of that, you've had extreme weather events that, you know, you've obviously been following in the newsletters. Things like the big floods in Rio Grande do Sul in the south of Brazil last March, April time, there's been droughts in the Amazon. There's been all sorts of disruption to harvests. So there are shortages of certain things, I mean carrots, a very simple item went up in the first two months of this year by you know, more than 20%. And what's happening is that poorer people are spending more on food and they feel let down. They feel very badly let down. So just to give you an idea, I mean in 2000, you know, Brazilians spent 16% on average of their household budget on food and 2024 they spent 20%. So you know, given the fact that poorer people are spending much higher percentage of that, it's quite a big hit. And what's happening is that, you know, people are now, I mean there's one of the best selling items in Brazilian supermarkets the moment is an adulterated coffee made from husk coffee, flavored coffee and it called café, it’s nicknamed. And that's going down. You know, that's the sort of thing that's happening. And this is not leading to a feel good factor, far from it. Right. There's no feel good fighter, but I.

Richard McColl: Can't think of much things worth worse than a cafe. And being that Brazil being, if not the top coffee exporters in the world, Vietnam, Brazil, the, this bankerization via mobile phone is always fascinating. I believe it through the continent for our US listeners. I imagine it's a type of Venmo type thing that we could sort of relate it to.

Richard Lapper: It's kind of, I mean it's related to the growth of electronic banking in part, you know, because over the past 10 years banks like Nubank have offered people accounts online without necessarily ever having to go into a branch. Yeah, this is a payments mechanism, the Centrão bank set up in 2020. It's unique to Brazil and it's very well run and it allows people to make payments, simple payments on their phones.

Richard McColl: Yeah, we have something here too. But this weakness in the currency does seem like a great concern and foodstuffs being increased so massively. Of course I can imagine the Northeast really responding to this. Of course. And then I suppose this leads to investor concern about the country and the viability of the country.

Richard Lapper: Well, I think, you know, that what investors are worried about, there's no doubt about this is the fiscal situation and the gradual growth in debt and the sustainability of debt. And basically, you know, Brazil's debt to GDP ratio Which is the way in measure these things is not that high really. I mean you'd think on the basis that net public debt at the Moment is about 66% but it's gone up quite a bit and it's scheduled to go up even more in the next four years. It's scheduled to rise by 10 percentage points. Expected, I should say, rather than scheduled, because I don't think the Centrão bank wants to want that to happen, but that investors think that debt is going to become increasingly burdensome. Why is that? Well, essentially Brazil is living beyond its means. It's got an overall fiscal deficit of 9% of GDP, which is quite high. And that is heavily influenced by rises interest rates. Because to contain this inflationary pressure, last year the government in August started first to hold and then to increase overnight interest rates and they have risen from 10.25, 10.5% sorry to 13.25 on the. In January and will go up again this month to 14.25. We're on route to 15% interest rates in real terms, you've got inflation of 5%, interest rates of 15. Credit is expensive. I mean real interest rates are quite high. And Brazil's in this familiar trap. We've been here many times before. Where to really contain inflation. Inflationary pressure that is coming from, you know, a public sector that is badly managed and possibly, I mean, it's. The problem with Brazil's public sector is it's badly managed. Rather than that it's, it is quite big. But to contain that interest rates are high. So you have, you run fiscal deficits and you know, to contain the impact you have to have tight monetary policy. So. And that's where we are at the moment.

Richard McColl: Let's get into this, the. Let's get into the meat and potatoes here. The Lula versus Bolsonaro. What's going on? I mean, obviously we have, we know from the attacks in January on the 2023, on the Congress. We remember the images of that. Of course it hugs to, you know, provides us for flashbacks of January 6th in the Washington as well, the same kind of thing. But Bolsonaroo, is he going to go to jail or is he going to run for president? And does he look like, I mean if. Should he run? He's probable to win, we would expect.

Richard Lapper: Yeah. I mean one or two polls are suggesting this month that if he ran against Lula, he would win. In a second round poll by cnt, the National Transport Confederation, that came out about A week ago saying that Bolsonaroo against Lula would win 43 to 41 in a runoff. I mean, that's quite interesting in itself. It shows that because hitherto Lula's generally been in front now it's pretty unlikely that Bolsonaroo will run. And that's not just because of the current legal action that began when charges on the coup were filed last month. Over a year ago now, I think over a year ago the national electoral authorities prohibited Bolsonaroo from running in 2026. And that was on the grounds of the allegations that he'd. He'd made about the electronic voting system being unfair and fraudulent. And Bolsonaroo got no basis for making those allegations. And the electoral authorities turned around and said, well sorry mate, you can't run. And he was excluded. He lost his political rights temporarily for seven years. So this must have been in 2023 because he can run in 2030, which would be the next scheduled election. Since then there's been a couple of cases against Bolsonaroo stemming from fairly minor violations. One involving a fraudulent Covid certificate that he used to go to get into the States and the other about the way that he'd appropriated gifts given by the Saudi government, jewels which were, you know, just a took for his own use, possibly sold, who knows. And then this, the rather more important issue that he's now facing trial on is the involvement in a coup attemPT in November, December 2022. Now this is quite separate from the attacks on Congress in January 2023. This involved, this involves a plot whereby Bolsonaroo and leading military guys, or leading military guys with Bolsonaroo's complicity, would have shot amongst others, Lula Geraldo Alckmin, the deputy President and or president elect as he was then. And Alexandre de Moraes, who's the leading Supreme Court judge of all the Bolsonaristas loathe and detest. They were, they were all lined, they were all going to be taken out. The plot never really got anywhere. Didn't, it didn't happen. But details were. Became available through the evidence of one of Bolsonaroo's assistants, military advisors and when he was picked up by the police. And so there's this case is now going to go to the Supreme Court. I mean it could go as early as next month. It's quite likely that, I mean, what's happening now is that the Bolsonaristas, Bolsonaroo and his family are fighting on various fronts. They're trying to delay the case from coming to court. They're trying to, they that they're trying to change the composition of the Supreme Court chamber that will hear it so that there are fewer Lula supporters in that body. The legislature, the Bolsonaroista supporters in the legislature are trying to introduce a new law that would allow amnesty for people involved in such actions. There are demonstrations on the street, promised in later this month. They're going to be a big demonstration in Copacabana in Rio de Janeiro. And of course, you know, Eduardo Bolsonaroo, who's speaks English, is, has been very active trying to garner support from Trump and his allies in the US and so there's a very good relationship between Bolsonaroo and Trump. You know, they were quite good friends when both were in office at the same time between 2018 and 20. Bolsonaroo For Bolsonaroo, Trump or something, he's a self confessed idol. And it's possible of course that, you know, now this vibe shift seems to be underway towards the far right and the popularity of Trump in various parts of the world, not just in Brazil or, but in other, in Europe in particular, is possible that this can have an impact. I think there's some attemPT by a Republican legislature legislator, I should say, to basically impose kind of sanctions on Brazilian, to Brazilian judges essentially who violate freedom of expression, which. Alex Alexandre de Moraes if you look at the recent comments of Elon Musk, that's quite a, you know, a low. It's not difficult to do that. Right. For Elon Musk. So who knows how this is going to pan out. The government, I think what it's fair to say that the government is getting into this conflict in a less buoyant state than it would like. You know, it's, it's ebbing, its popularity is waning, the economy is now slowing down. So that some of those positive trends that we talked about at the beginning, you know, like lower unemployment, are beginning to. Unemployment's rising again this year. So it is not a good situation. Lots of uncertainty out there. And I think the really crucial thing, Richard, is that this government really depends on its alliance with parties of the center and the right. Now there's two classes of centre and the right in Brazil. On the one hand you've got people like Geraldo Alckmin, the deputy president, and Simone Tebet, the planning minister, who are members of traditional center moderate conservative parties like the old PSDB or You know, Tebet’s party is the MDB. There are elements of, you know, fairly sensible conservatism within both those parties. But then you have a whole number of different center right parties, the parties that are known as the Centrão, that are really much more in it for their own ends there. They want to do things to benefit their own supporters and to pursue and to really advance their own political projects. And Lula has. But that relationship has been working in the last two years. The president of presidents of both houses of congress are very important in the Brazilian system are from those parties. They've recently been replaced. But they're from a separate. The separate guys, but they're from the. Still from the same kind of parties. They're demanding a bigger share of the government. And Lula, so far in this big reshuffle that began in mid January, has not given much away. The three big cabinet changes have all really involved moving positions of importance to different people within the PT. And that suggests that Lula's dedicating a lot more time to thinking about the internal politics of the Workers Party and its very complex factional battles than he is thinking about how he can keep these various parties from the fragmented congress on board and developing a plan to develop for a broader alliance in 2026. And that is a concept. I think that's a concern because it's hard to, you know, the PT these days is a. Is not. It was. It's the. In the municipal elections in October, it was the eighth biggest party.

LatinNews: This podcast is brought to you by LatinNews, the leading source of political and economic news and analysis on Latin America and the Caribbean since 1967. Access LatinNews full portfolio of [email protected].

Richard Lapper: You know, this is a party that has. That thinks it's more important than it is really. And it really failed to generate much enthusiasm. And I think it's. And I think in a way that gets to one of the heart of the problems that Lula faces, because the politics of the PT, which at the end, you know, when all said and done, the politics of the PT were really developed during the 1970s and 80s when Brazil was a very different kind of place. You know, I mean, Lula was a obviously a very prominent trade unionist in the south and the industrial region of São Paulo. His politics were very heavily influenced by that experience of, you know, industrial struggle. And these grassroots movements are much weaker now in Brazil than they were even 30 years ago, let alone back to the 1970s. You know, we the most recent figures from the statistics agency, only 8.4%. I think it is off the top of my head. Brazilians are unionized in terms of the labor 8.4% of the labor force that was as high as 30% in the 1980s. And what's happening amongst poorer Brazilians, low income Brazilians is they're increasingly individualistic in their mentalities. You know, the word that people use in Brazil is empreendedorismo. You know, people are, you know, however, you know, poor. They're always doing their own thing. And I think that digitalization offers many poorer people different kinds of opportunities now. It allows them to be more individualistic. So the, I mean give you a good example, I mean someone I interviewed quite a bit for the book is a woman who is a manicurist and who visits my mother in law's house and which is in a sort of lower middle class area of Salvador. And before the pandemic this person was, she's in the mid-30s and she was working in a shop and earning about a thousand reals a month. So roughly $250 at the time. So now she's. During the pandemic. She started before the pandemic rather she started working in a manicurist and again was earning a similar amount during the pandemic. She went on her own and using a mobile phone and an account with Uber, she's able to have different clients. She visits about four or five people a day and she can earn as much in a week doing that without any social benefits obviously than she could in a month working in the formal sector, that is. And she got no interest in working and having a formal job. And that's increasingly the situation of many low income Brazilians. And you know, there are 2 million people in Brazil who work for the various platforms, you know, the Ubers, the iFood, which is a food delivery where they just, you know, they earn. Surveys suggest they earn slightly more. If you're, if you're low skilled, you earn more doing that than you do in a formal job. And it's this base or this economic base that has migrated to the right. These, the people who are support and they don't support the PT anymore. They might have done in the past, but they don't now. This is. So the PT is losing its base to this kind of, amongst this kind of population. The other thing that's really reinforcing that is evangelism, Protestant evangelism.

Richard McColl: There's so much in that. I would say it's kind of this, as you say, individualistic gig economy, which has taken off in these regions, I suppose everywhere as well. No need to unionize on this because again, you're your own person and as you say, very much more attractive because you're not in the system as it were. And the bureaucracy that we know to be so plentiful in Brazil and other countries similar to it. I just wanted to ask a couple of questions before we get into the evangelical side of things, the evangelism, because it is a fascinating phenomenon in Brazil. It really is a huge voting bloc because they tend to vote together on this. But is, does Bolsonaroo, if we come back a long way there, does he have anointed successor? Is it Eduardo Bolsonaroo? His son?

Richard Lapper: So in terms of, you know, the Bolsonaroista movement, they've always had problems developing something coherent and stable. I think going back to 2018, 19, there was a project to create a bolar party. They just couldn't, they couldn't get, they never got around to collecting enough signatures. Admittedly, the bar for, you know, getting a new party formed in Brazil can be quite hard to meet sometimes. But they didn't. And you know, this is the clan, you know, Bolsonaroo's three sons are all active and some of, they're active for different political parties and some of them actually. But so there's. People are talking about Eduardo. People are talking particularly about Michelle Bolsonaroo's younger wife has been a possible candidate. If Bolsonaroo can't run. The smart money, or not necessarily the smart money, but the business community's money is on Tarcísio de Freitas, who is the governor of São Paulo and was the infrastructure minister in Bolsonaroo's government. He's seen as being a more moderate, more traditional right wing conservative than Bolsonaroo, but he got on fairly well with Bolsonaroo and he's done his best to try and keep the Bolson, the more rabid elements of the Bolsonaroista base on board. Now so far, although he's popular within São Paulo, so is the governor, he's not been able to establish national projection. So he's not seen, you know, when you talk to people about Tarcísio in Bahia or Minas Gerais or Goiás or somewhere, they don't, they never heard of him. So he has very low name Recognition. This is in part because Brazil's, you know, not a particularly political country in many ways. So when Tarcísio's name is mentioned in opinion polls, it doesn't, you know, there's not many voting intentions attracted by it. So there's quite a job to do to promote him. As I say, you know, a lot of people in the business community would really like someone like Tarcísio. One of the other right wing governors, Caiado of Goiás is another name that's often mentioned, Ronaldo Caiado. But at this point there isn't. There isn't it. Bolsonaroo would do much better than any of these potential successors. And it's possible that even now, despite this fall in popularity, Lula would beat any of them.

Richard McColl: And of course, there's always an opportunity he might beat them and he believe in his own sort of, let's say, political legend. But this, it seems to me from everything you're saying is he does tend to be, or seems to be right now, quite detached from this new reality in Brazil, quite unaware of what's going on by putting his, like doubling down with his own PT henchmen, let's say henchmen or friends in the party itself, in the government itself. So pretty interesting times coming up. But I think we should probably address the evangelism a little bit because it is such a huge movement and would they. Would the events. Do the evangelist parties or let's say the evangelist groups blindly support the right and Bolsonaroo?

Richard Lapper: No, I don't. I think it's more complicated than that, Richard, actually. I mean, there are evangelical leaders who do support Bolsonaroo, but equally there are also evangelical leaders and parties that are in Lula's camp at the moment for opportunistic reasons, it has to be said. But there's a party called the Republicans which is close to the Universal Church of the Kingdom of God, which is the. One of the homegrown evangelical churches which is now currently hits. One of its leaders is the new president of the lower house of Congress and was elected with the PT support. So it's not cut and dried, but it's true to say that evangelical voters are generally more anti Lula and anti government than their Catholic equivalents. So I don't have the numbers at hand and we don't want to go through numbers here, but I think it's, you know, you're much more likely to be, I mean, it's like more than 60, 40 against the government, whereas Catholics, you know, and that Was, that's true. Going way back to 2000 and back to the previous elections. You know, this, all this really began with Dilma Rousseff when Dilma advanced various pieces of social legislation and which were resisted by the Evangelical church. So there was a big movement against her. And you know, Bolsonaroo rode a wave of evangelical support and I think he's still more popular amongst evangelical voters. The part is as such a more complex as I say, because, you know it. Brazil's political system is so fragmented and basically the evangelicals in the legislature function as lobbies and they get tax breaks, they get favorable treatment from the authorities and that's, you know, the main. And they lobby on things like, you know, to stop. They lobby against things like gay marriage and things like that, which they've been slightly outmaneuvered by the judiciary on those things. But it's still, it's a big voting block that tends to go with the right. I think the point, sorry, just the other final point there, the point to make is that these small centrist parties, the Centrão who support Lula now were supporting Bolsonaroo in 2021. They basically in 2020 when Bolsonaroo faced impeachment, it was the parties of the Centrão that saved his skin and preserved the government. And you know, the benefits they get from it are they get money in exchange for that and the amount of money that congressmen get, including these parties, not just them, but very much them, is much greater than it was back in 2015. These congressional amendments that, this, that are being voted on. So Congress has got its own, you know, the Congress is much more powerful as a block compared with the executive than it used to be. Brazil used to have the system of presidential coalitionalism where you had or coalition presidentialism where you know, the President basically lined up on a group of people who, you know, was his political allies and that's begun to break down. It's now much more ad hoc and Congress have a lot more power.

Richard McColl: That's. And that was the final point I was going to bring up. So we've gone through a lot, Richard, and what I find is again the title of your book for 2026 is not yet set. You cannot predict what is going to happen in the coming year at all.

Richard Lapper: Well, so I'm kind of, I do think that this longer term disconnect between the PT’s the kind of core ideology of PT activists and this disconnect between them and the rest of the country is becoming more pronounced and I think in, not just in the way we've already talked about, not just in the way that they don't connect with the empreendedor instinct of many poorer people. And I think it's worth mentioning in that respect that you know, the government completely failed with an effort to try to regulate Uber taxis and ride-hailing companies in general last year, which was resisted not least by the Uber drive. They were on the streets stopping it and you know, it just fell by the wayside. So it was, it just, they've got to find they, there is a way in which these guys do need some kind of protection. You know, it's pretty bleak being an Uber driver and being, you know, you're seduced by the immediate freedoms and by the fact that you're, there's more money in your pocket, but actually you don't have any protection. And you know, there's ways that you could work more subtly with these groups to bring them on board. And so far the trade union movement have not shown any great skill in doing that. So that's, that's a problem. So I think the other thing that I think is a problem for Brazil is that many PT activists, you know, because like their comrades elsewhere really into the whole identitarian ideologies, you know, anti racism, the gender ideologies and so on. And it has to be said that they're way out of the way out of sync with the population. You know, in that sense that these Brazil's. It's not that Brazil is not. Brazil is a racist country, but not in the same way as the United States. It's just not as clear cut for Brazilians. And so a lot of the rhetoric that you associate with the identitarian movement goes down extremely badly. And one of the problems it's given rise to is that when the PT say we need to approach poorer groups, we need to go to the favelas, we need to kind of persuade people that they need to think about their economic interest. Many younger activists are not prepared to do that because the people they're going to be talking to and trying to persuade are evangelicals. Yeah. And they don't agree with their propositions on gender.

Richard McColl: It seems. Well, yeah, I think we've covered many if not all of the main concerns and of course the conundrums that face voters, and not just the voters, of course, the political parties as we approach the election year. And Richard, let me wish you the best with rewriting, writing and updating this future book on Lula for due out by with Bloomsbury in 2026. So everyone please stay aware, stay alert. I could tell you now that it might be the rise and fuel of Lula, but by that time it could be a different title altogether. So just look for Richard Lapper's new book. It has been a phenomenal conversation with writer and journalist author Richard Lapper. And we've covered so much there's almost too much to go through right now. So thank you again for your time and thank you for your expertise. Tease.

Richard Lapper: Well, thank you, Richard, for having me on and you know, hope we speak to you again soon.

Richard McColl: I hope so as well. This has been the LatinNews Podcast. I've been Richard McColl, your host here in Bogotá, Colombia. We'll be back in a fortnight with further podcasts about issues from the region. I hope you've enjoyed the show. Be sure to share and of course, promote the podcast. Thank you again and goodbye.

Outro: You've been listening to the LatinNews Podcast. For more news and analysis on Latin America and the Caribbean, visit www.LatinNews.com.

Ank Kuipers is a journalist based in Paramaribo, Suriname, with a focus on political and economic developments in the region. She has contributed to international news agencies, including Reuters, covering significant events such as the death of former President Desi Bouterse, Suriname's debt rescheduling agreement with China, and diplomatic tensions with neighboring Guyana. Her reporting provides valuable insights into Suriname's internal affairs and its interactions on the global stage.

Intro: Welcome to the LatinNews Podcast, a fortnightly deep dive into key developments from across Latin America and the Caribbean. Here's your host from Bogotá, Colombia, journalist Richard McColl.

Richard McColl: This is the LatinNews Podcast. My name is Richard McColl. I am your host here in Bogotá, Colombia. Our very special guest this week is in Paramaribo, Suriname. Journalist Ank Kuipers is going to talk to us about the upcoming elections in Suriname due to take place. And of course, this could lead to, well, life-changing oil wealth in the country. And so we need to talk about that and of course, who the candidates are and what they're promising to the electorate. So, Ank, thank you so much for coming on the LatinNews Podcast.

Ank Kuipers: You're welcome. My pleasure.

Richard McColl: This is an absolute pleasure. Because Suriname is a largely unknown quantity, you know, up there on the shoulder of South America, but it's becoming incredibly important at the moment. So perhaps you could tell us a little bit about this upcoming election.

Ank Kuipers: Well, the election is on May 25, and currently the parties are registering. We have about 400,000 voters, and there are between 15 and 17 parties and party combinations participating in these elections. And that's quite a lot for such a small amount of voters. And also they. They all have to pay about US$15,000 and only if they gain a seat, at least one seat, they will get the money back. Otherwise they lose it.

Richard McColl: Significant expense.

Ank Kuipers: Yes. And there were protests because it was even higher, of course. Upcoming small parties. It's a lot of money.

Richard McColl: Yes.

Ank Kuipers: Especially in a country where the. The income is very low.

Richard McColl: Do. Do people. Does the population, the voting population in. In Suriname vote along race lines?

Ank Kuipers: They used to, but it's changing. It has changed and it is still changing. There are still parties that are more attractive to certain ethnic groups. The population is more mixed now, so that is gradually vanishing.

Richard McColl: And I mean, we. So you say May 25, we have these elections, 15 to 17 parties. Is there any likelihood of any one party winning outright? Because I imagine they're going to have to make agreements and deals across the board.

Ank Kuipers: Yes. There will always be a coalition government. Always. Because to elect the President, you need 2/3 of the seats in parliament. And it's very hard to get these seats as one party alone. You. They will never make that. No. If you don't reach, if you can't elect the president in parliament, then we have this very huge meeting of like 800 regional representatives who then vote. But I think this time they will find that they will elect the president in parliament.

Richard McColl: Oh, you Think it's going to go through. And who are the main. Who are the main parties and candidates?

Ank Kuipers: So we have. The current government consists of the progressive reform party of president Chan Santokhi. It was originally a very East Indian party, A party with people originating from India. He is governing together with ABOP, which is the party of Ronnie Brunswijk. He is the current vice president. His party was originally attractive mainly for the descendants of the African people who live in the interior. He also governed with the national party of Suriname. That's the party that originally was the party of the descendants of Africans living in the coastal area. Yes. And he also was governing with Pertjajah Luhur. That's a party of people of Javanese descent. Yes, but they all try to show that they are a very multi ethnic party, all of them. And during the last years the nps, the. The national party of Suriname got out of it. It. It quit, it left the government. And there are also tensions with the Japanese party. But the VHP, the party of the president, they gained 20 seats of the 51 in parliament during the elections of 2020. But that was also because a lot of people, a significant amount of people left their traditional party because they wanted to vote out Desi Bouterse, the former president. So they. They left their party to. To vote Bouterse out. But it's widely expected that they will return to their former parties because they are not very happy with the current president.

Richard McColl: Okay. And the. This. It's con. It's complex, this discontent with the president. Why is there this discontent?

Ank Kuipers: Well, when this government arrived, they had actually they started one month earlier than they should have because the former government didn't have any money to pay the civil servants anymore. And they knew that they would take over. That's what they always say, that they would take over. A very bad economic situation. But it was much worse than they had ever expected. So they started to work with IMF. There was no other choice. That's what also all economists say. The situation was really bad. And they started to reform the economy. But they forgot to do the. They should have protected the poor people first. And they had some sort of system in place along the way. But it doesn't work very well. Which means that about 20,000 people received support from the state that shouldn't have received it. While other people who should have received it don't get it. And the people get. Per month they get 1800 Surinamese dollar. It's just to support them. And that's about $50, $50 a month. Yes. That's just to support them to be able to pay perhaps electricity, water, gas, cooking gas. Yeah.

Richard McColl: Do we think that this has a great deal to do with. With corruption in Suriname?

Ank Kuipers: I think partly corruption because people who received it, entitled to it. They. Of course, yeah. How else would they get it? And also because perhaps there was not the right staff at the Ministry of Social Affairs. I personally tried to get this support for a very poor person. And I spent about a whole day calling everyone in the Department of Social affairs. And poor people, they don't have money to call. It's too expensive. So that's why they just don't receive it. So people are not. They are not aware about the macroeconomic restructuring that went very well. I mean, there's a lot of compliments for Suriname that they did it really well and they restructured all the debts and stuff like that. But of course, if you don't have enough to eat or you can't pay the doctor, then it doesn't count.

Richard McColl: So. So the incoming government was able to restructure the debt and. And get some favor from the IMF, but yet the economy is still in a. A very bad place.

Ank Kuipers: It's. It's still vulnerable, but they got the inflation down from 60% yearly to 10%. So that. That is quite an achievement. Yes, but for the people, that doesn't count because they are angry and they are also very open for brainwashing by Facebook and other social media. And I think a lot of people also have very bad memory. It.

Richard McColl: Well, this is something that. That we see all over the continent and if not over the world. But yeah, when we talk about unemployment, there were those very big, serious protests in 2023. Is this what we're referring to as well, that the. The rage with the current politicians and the situation?

Ank Kuipers: Well, the protests in 2023, February 17, they were against the. The economic situation and also against government policy. But actually they were quite. They stopped. It was a very peaceful protest. When I was there, you see people selling ice cream. You see tourists making pictures of all the colorful people with umbrellas because there was so much sun. It was a calm day, it was a nice protest. But there were also people who came there with bags filled with fuel and stones, and it looked as if it was very orchestrated and the authorities didn't really react in a proper way. They were not. We have a lot of intelligence surfaces, but apparently they hadn't done their job because apparently it came like as a surprise. And then they also. This happened on the square where the palaces and. But then the. The crowd went into the city and then you had all this looting and stuff. But the. The majority of the people there, I think I might say perhaps 95% they were. They were not happy with the situation and they were protesting, but they would never initiate something like this. But of course, in such a small country or community, everybody was very shocked. It has indeed been a big shock for a lot of people.

Richard McColl: So with this situation, which obviously when you say the inflation has improved, but it doesn't change much for the poor and the needy, we. With this situation and with elections in May and very soon indeed, what are the candidates promising? What are they promising for the population?

Ank Kuipers: Everything. They promise heaven. But okay, the current. The party of President Santokhi, he wants to get another term because he says, well, we've now had the hard part, so we can now start doing nice things. And actually he already started a bit, which is populist and it's not a good signal. Also the. The delegation of IMF was warning for that, against that. But in a way he is. I think it's true that the hardest part that we have, that's behind us now, but still the government budget, we are still very short of money. Even the organizers of the elections now said, well, we need money to continue preparing everything, but we didn't receive that yet. First, the budget has to be approved in Parliament. But he really asked the people to not listen to the promises of other parties, because some parties, they are already standing there and want to perhaps start borrowing again. And we still have very many loans to. To pay back. They only restructured them, but they. There are still a lot of debts.

Richard McColl: Yeah,.

Ank Kuipers: The party of Desi Bouterse, the former president, you know that. Well, let me explain a little Daisy about this. He. He plotted a coup in 1980. And when he was just a young soldier sergeant in 1982, 15 opponents of his then military rule were killed by military. And he was. After over 40 years, he got the verdict. He had to go to jail for 20 years and then he disappeared. That was in January 2024. Nowhere to be found. Lot of rumors. It's a small society. Everybody knew where he was. He was at home, they constructed a bunker. He was in Venezuela, he was in Cuba. He was in the interior there a lot of theories and everybody knew where he was, but he was not found. And then one day before Christmas, he was delivered at his house in the city by a black bus. But he was. He had passed away. So There was a big shock in society. He is a. He was I think, the most charismatic leader Suriname has ever had. Also appealing to a lot of youngsters. And the man was. Yeah, he was in his 70s. He was not in good shape. He smoked, he drank alcohol. But he had this charisma. He was a great singer on the stage. And for you the. The murders of 1982 was ancient history. And also in the schools. People don't there. There's not much information on the recent past of the country. So he passed away and now his widow. He is now on the political stage.

Richard McColl: Really?

Ank Kuipers: Yes. And she's. Yeah, you see how she's developing her skills. But the party also has a different chairwoman now. Actually, when he disappeared, they voted for another leader of the party, which was in June last year, I think. And there's also his vice president who's quite young. He's 42. And apparently those three persons might become presidential candidates. But they are not. They are still figuring it out in the party. There's also a lot of fighting because of. Or well, perhaps not fighting, but they are struggling to find one way with the whole party. And it's going to be very interesting. But none of them has the charisma Bouterse had. So they keep mentioning him, projecting big pictures and small quotes of him. All to show the people that actually he's still here and he ordered them to win the elections.

Richard McColl: So it seems to me that Bouterse has he. He throws a. A long shadow over Suriname's politics. And whoever manages to receive you know, or. Or convince the electorate that they are the anointed candidate of Bouterse has a. Has a very good chance of. Of becoming president.

Ank Kuipers: They need two third in parliament. And so it might be. They might find partners to cooperate with. But perhaps these partners will say, well, we want to. To do the presidency. So it's. It's not very predictable what will happen. Also because our electric electoral system changed. And before we had 10 electoral districts and the votes there were not all, did not have all the same weight. So now for the first time, the whole country is one big electoral district. And all votes are important, evenly important. We have this very small district of Coronie of which I happen to hear that you've been there. Yes. And Coronie is the smallest district. But every elections you would see political parties speeding to go there and build their party center and talk with people and be friends and oh, Coronie is very important. Coronie. In Coronie there were only last elections, about 1600 voters. 1600. And they were good for two seats in parliament. Two of the 51 seats. So that was completely out of. Out of balance. They now changed it so every. Every voter has the same word. And 65 of all votes are being casted in either Paramaribo or the neighbor district of Wanica. So 65 will be voted in the. Of the voters are in the coastal area, in Paramaribo or next to it. And that's why a lot of parties now only concentrate on this area because they know that they. If. If they have these two. If they. If they get the votes of. Of the. Of the people in these two districts, then they have the majority. Then they have 33 seats and they only need one seat more to elect the president.

Richard McColl: So the concentration is on the coast. The concentrations. We would say that they're not ignoring the interior, but the interior has very much taken a back seat.

Ank Kuipers: There's another comparison I could make. The party of the current vice president, Brunswijk, got not even 25,000 votes, which is 9% of all votes in 2020, but he got eight seats. And then the National Party of Suriname, they got 32, 000 votes. 11% Of all votes, but they only got three seats. So it was very un. Proportionate.

Richard McColl: Yeah, it's. It's the issue of the electoral college over one votes and you know, singular votes. It's a. I'm seeing this, you know, this common theme occurring obviously in Suriname and obviously many other countries as well. But this lack of money and economic concerns, other. Other issues that people are very worried about. So what are, you know, we're. We're living in an unstable, uncertain time at the present. Other security issues in Suriname as well,.

Ank Kuipers: There are, but not as bad I think as in the neighboring countries. People do not feel safe. What's very concerning for people is the health care, which really, I think last year about 300 nurses and doctors left the country. They go, they work in Curaçao, in the Dutch Antilles or in the Netherlands. Also well trained nurses who used to work in surgery rooms or intensive care. They just leave the country for a better income. And also education is something people really find very important for their kids. And yeah, I think a teacher only earns perhaps between 2 and 250 US dollars a month. So life is hard for people.

LatinNews: This podcast is brought to you by LatinNews, the leading source of political and economic news and analysis on Latin America and the Caribbean since 1967. Access LatinNews full portfolio of reports at www.LatinNews.com.

Richard McColl: I mean, is there any way we talk about, I mean, we get to. Onto this now as the potential for all of that, you know, the discovery of oil in Suriname and life-changing oil wealth, such as? Well, such as what has occurred in Guyana. This could turn Suriname around. This could go to the health, if of course, it happens. Health care, the economy, to education. What do we see happening in this situation? I mean, I suppose the political parties are promising, as you said, heaven. They're promising heaven. But they're looking obviously at oil wealth, potential oil wealth?

Ank Kuipers: Yes. So many, all of the parties, I think, are looking at this oil wealth and some of them really want to take an advance on that income. IMF has warned against that. Economists warn against that too. Also, we have still a lot of debts to pay. And part of the oil income will also go to the bondholders, which the former government borrowed a lot of money from, against I think 12 or 13% interest. So there actually the coming years there will not be much income. The first oil will be out in 2028. But of course there will be influx of workers, equipment, there will be more employment. They try to school people now to. To be able to fill. Fill these job openings, but it will not also in Guyana. Well, what we hear is that the poor now have to leave the city because the rent is. It's not possible to pay the rent. The houses become more expensive, so the wealth is not equally spread in Guyana. So that's one thing Suriname wants to learn from or certain parties want to learn from that the government is not allowed to overspend. But what we now see is that, well, last week when there was a press conference of the Minister of Finance and the IMF mission, then after that, the minister had a meeting with Staatsolie, our national oil company, to see if there. If he could get some funding for urgent things he had to pay. But they are not allowed to overspend the budget and IMF. The IMF agreement cooperation ends in March. And so there might be a new agreement with the new government, depending on which government will be there. And also people say it would better to keep IMF on board just to prevent the reserves from being robbed again, because we now have reserves. We have, I think, reserves at the central bank for eight months. But when this government came in, there were not even reserves for one month of import. And it's an importing country. And also the government, just yesterday they announced that they renewed the contract with the Central bank governor who was to retire in March, but he will stay on for one year longer, according to the president, to guarantee economic stability because they are afraid a possible other government will put people there who might have different view on economic subjects.

Richard McColl: Clientelism and corruption I think we're getting at here. Definitely.

Ank Kuipers: And when they. When they came into power there was not. There was only I think not even sufficient for one month of import because they need at the Central bank to have. You need reserves.

Richard McColl: So the solution that these political parties c is to take advances from the potential oil wealth. And this sounds very dangerous indeed. This sounds very worrying for an economy that's in such a bad state.

Ank Kuipers: That's why. Yeah. I think economists and also pragmatic politicians say well let's renew our cooperation with IMF because then at least we will have to keep the budgetary discipline. But the first three years or perhaps even longer, this amazing wealth will not there. Yeah.

Richard McColl: And. And this is the problem is that everyone thinks it's an immediate boom for the country and. And for the population. We. We're winding this down now, Ank, but I need to sort of think you. You're talking about so many political parties and so much so many promises. 15 To 17 political parties potentially and people who haven't decided whether they're running and you know, the elections are in May. It's just round the corner. Is do you have any possible prediction? Do you think the incumbent can remain in power or is it's going to go a different way in a different coalition?

Ank Kuipers: Well, I think most of these parties will not get any seat. So there may perhaps be six or seven or perhaps eight party or parties combinations that will gain seats. There is a big chance that the current leading party of the current president will. They will lose some seats, I think, but they will still be one of the bigger parties and I think the party of Bouterse, the National Democratic Party, they will be gaining seats that we have a voter turn out of about 73, 75% normally it's quite high. Yes. And so I'm really looking forward to see how many people are now going to vote or not the ballot the form will between. It will be 50 x 70 cm and that's really kind of small. It's because they only will put one picture of each party on this thing. But there are now also parties who say no, we need all photos, all pictures on the ballot. And of course there. There's illiteracy so people cannot. They don't know what their. What they vote, who they vote for then.

Richard McColl: And as we. What about this contested area between suriname and Guyana? What. What's going on there?

Ank Kuipers: Yes. Well, apparently the guyanese are quite active there. They do have their army there and they announced that they, I think they would build a school or something and an airstrip. Suriname keeps protesting or at least they keep registering all the incidents because Guyana is an english speaking country. Most of the. Of the world uses their version of the map where suriname is a dutch speaking country and they keep showing this map. And there was two weeks ago, or a little bit shorter, there was a conference here of the surinamese Guyanese chamber of commerce. And people were really enthusiastic. It was a really good vibe and a lot of great things have been accomplished. But then somebody found out that one of the organizers handed a document with the surinamese map. So now the guyanese president or government has called the surinamese ambassador for a formal complaint. And now the organizer, he apologized much to the, to. Well, a lot of people here think he should have never done that.

Richard McColl: You know, a negotiation takes both sides and having a reasonably.

Ank Kuipers: There's no negotiation. This is, this is certainly surinamese area.

Richard McColl: Okay. And of course there must be mineral wealth in that area.

Ank Kuipers: Everywhere.

Richard McColl: Everywhere. Exactly. So there we go.

Ank Kuipers: There's also one other subject that is now being discussed because this, the government, they had a commission and the commission had a memorandum of understanding with Chinalco, it's chinese alumina company. And they were, they are, they were promised that they can work in the west of suriname and take the bauxite, put it on big ships, take it to china and process it there. And there's much protest against that because people say, well, if we don't have the refinery here, we don't need that because we will earn very little compared to what we could have earned. And they say, and of course that's I think a valid argument, we will have all this oil wealth. So why should we do this? Because compared to all the oil wealth, it's a small amount of income.

Richard McColl: Certainly with the oil exploration due to take place and hopefully, let's say start pumping oil in 2028. There have already been concessions to companies. There are already concessions to big companies making the deals for the oil.

Ank Kuipers: Yes. And I just today received a press. Press release which I now can find very easily. It's amazing. And so TotalEnergies, they will drill in deep sea. They will, they made the final investment decision and our oil company is now gathering the funding to participate for 20% in that. Then there is also this year there will. Shell and Casara Energy will drill in another block an exploration well. Also this year there will be very close to the coasts. So near. Near shore there will be drilling by QatarEnergy and a daughter company of Staatsolie. So all actually all the coastal area has been. You can perhaps see it on the map. No,.

Richard McColl: It's been divided up already.

Ank Kuipers: Yes. And there are still blocks available. But Staatsolie is doing that quite carefully and well planned. We have the regulator which is still now part of. Of Staatsolie in some way, but it's the national regulator. And what most experts say is that the contracts that Suriname has negotiated are much better than the contracts Guyana negotiated. But because Guyana hit the. The. The jackpot at the first hit, they are now gaining a lot more. But our contracts generally are being considered as much better than Guyana companies.

Richard McColl: Well, that's a nice positive note to end on.

Ank Kuipers: Yes. Well, there's so much. There are so many other positive things too in this country. You know, we have a lot of. Of forests.

Richard McColl: Yes.

Ank Kuipers: We will also try to. To. There is a green development strategy. Strategy. They want to earn also on the carbon credits and we hope that they will protect the forest better. But it's a beautiful country. It's very interesting. Very nice people.

Richard McColl: Yes.

Ank Kuipers: Of all parts of the world. So it's very diverse and really good food.

Richard McColl: Yes.

Ank Kuipers: So we only hope that people can afford to buy that food and to plant, because it's a very fertile country. Yes.

Richard McColl: Well, let me take this moment to say thank you so much Kuipers for sharing your knowledge and obviously deep affection for Suriname, your home. We hope that this election in May, a very crucial election for Suriname it seems. We hope it goes off peacefully and of course is. Is the right direction for the country in the future regarding the oil wealth, regarding the economy for the local people, health care and the other concerns that you have of course expressed. So it's been an absolute pleasure to have you here on the LatinNews Podcast.

Ank Kuipers: Thank you. It was nice talking to you.

Richard McColl: So thank you very much to Ank Kuipers there in Paramaribo, Suriname. I have been your host Richard McColl here in Bogotá, Colombia. This has been the LatinNews Podcast and we'll be back in a fortnight's time discussing further issues and topics from the region. Goodbye.

Outro: You've been listening to the LatinNews Podcast for more news and analysis on Latin America and the Caribbean, visit www.LatinNews.com.

Dr. Ignacio Bartesaghi is a specialist in international trade, economic integration, and geopolitics, with expertise in Mercosur, ASEAN, and the EU. He holds a postdoctoral degree in Economic Integration from the University of Valencia, Spain, a PhD in International Relations, and multiple postgraduate qualifications in trade, business, and logistics.

He is the Director of the Institute of International Business at Universidad Católica del Uruguay (UCU) and leads the International Office at UCU Business School. A former Dean of Business Sciences at UCU, he also consults for international organizations and has held roles at ALADI and the Uruguayan Chamber of Industries.

His research explores global trade policies, regional integration, and the impact of China and the Asia-Pacific on international markets.

Intro

Welcome to The LatinNews Podcast, a fortnightly deep dive into key developments from across Latin America and the Caribbean. Here's your host from Bogota, Colombia, journalist Richard McColl.

Richard McColl: This is The LatinNews Podcast. I am your host, Richard McColl here in Bogota, Colombia. Our very special guest this week is in Montevideo, in Uruguay. It's Dr. Ignacio Bartesaghi. He's a Doctor of International Relations, Director of the Instituto de Negocios Internacionales at the Universidad Católica del Uruguay. And this week we're going to be discussing Mercosur, the trade agreement, the trade policies out of this part of Latin America. And I can think of no one better to speak about this. He's authored a book on the topic. He's continually asked to interviews and to explain the situation. Ignacio, welcome on The LatinNews Podcast.

Dr. Ignacio Bartesaghi: Thank you, Richard. It's a pleasure for me.

Richard McColl: No, this is our pleasure indeed to talk to you about Mercosur. Perhaps we could start with the basics. Where does Mercosur find itself right now in February 2025?

Dr. Ignacio Bartesaghi: Mercosur. You know, Richard, that Mercosur is crossing a crisis, a structural crisis. Because the problem is that what we write in the agreements, in the regional agreements, the objectives of the regional agreements, we never achieved that. So Mercosur, that was launched in 1991, and if you read the Treaty of Asunción, you read the article one, for example, we must achieve the objectives of the European Union. We must build a common market, we must build a customs union, but we never achieve that. So we spent more than 30 years of history without achieving our original objectives. So the problem is that Mercosur nowadays is more popular because we close the agreement with the European Union. So that is international succeed. But in the internal objectives we are a free trade zone with a lot of problems and exceptions. We are economic integration process.

Dr. Ignacio Bartesaghi: That is enforced, of course is working, but it's not working like the papers told us 30 years ago, that we must work. So I think that is the more important issue to understand when we talk about Mercosur, we have two Mercosur, the Mercosur of the original treaties, the Mercosur that we have in the papers, but the Mercosur of reality. Mercosur of reality is totally different of Mercosur of the papers. And that is part of the discussion and that is why we are always trying to compare with the European Union. But at the end it's impossible because the European Union is working like a customs union. It's working like an union, like it's like a. It's more than a customs union. No because also you have also the. The euro. And in the case of Mercosur, we. We are in.

Dr. Ignacio Bartesaghi: In another level, we never achieve that important objective. So that is one of the most important problem of Mercosur, what we want to do. Because after 30 years, maybe we must have a discussion about a reform of Mercosur. We must have a discussion about we are going to be a customs union in any moment, we're going to be a common market or we must to sign a new treaty. We. We must to be aware that. That their partners don't want to achieve that goals. That is the most important discussion now. And also it's part of the discussion between Lula and Milei.

Richard McColl: You brought up a lot of issues there of what was written in 1991, obviously and what is relevant today in 2025. And this brings me to the point is you've got free trade developments with the EU. And in 2024, in December, it seemed like something was going to be signed. It seemed like this agreement was going to be pushed across the line. But is it going to happen? Because you know, there's the opposition from EU farmers, there's a European demand for mercury sourced beef. But of course environmental considerations such as deforestation. Will Mercosur be able to change its policies and evolve into a new look deal?

Dr. Ignacio Bartesaghi: Yes, I think that Mercosur is able to do that. We need time, we need cooperation, we need support from the European Union to be able to have that new compromise environmental issues or in other regulations that as you know, Richard, are very hard in the European Union. Yeah, but what happens in Montevideo summit last December were very strong. Why? Because the picture is very strong. Ursula von der Leyen here in Montevideo. And the picture is also very strong because you sent a message to Trump. European Commission is sending a message to Trump. When you ask in Brussels, why now Europe called this agreement? Because this agreement more than 20 years of negotiations. Yes, because we need to send a message to Trump. We need to have new partners and we need to depend our relation with new partners.

Dr. Ignacio Bartesaghi: Because the international new context of Trump that is already ongoing. We can see what is going on with Trump. So this is one important thing of the picture that happens in December, but also Milei and Lula for the first time reacher in the picture. This is also important for Lula, for Brazil. It was a victory for Brazil. So then the agreement. Yeah, we need time. You need to the legal review. You need at least six, seven months for that. Another six, seven months through the translation of the languages of the European Union. More than 20 different languages. So you need more time for that. Need the discussion in the European Council where you have to talk with France. That's as you know, it's totally. You have the position of this agreement. Not only France, also Poland and other Ireland and other countries.

Dr. Ignacio Bartesaghi: We need to know what is going to happen with. With Italy that it's important to. To. To. To reach the necessary votes of. Of the European Council. Then you need a discussion in the European Parliament where it's going to be complicated, Richard, because you have on the side of Mercosur Milei that is against about all the 2030 agenda of the UN and you know that for Europe that agenda is very important and for the Parliament that agenda is very important. So we're going to have Milei that is similar in this case to Trump that position. I don't want this agenda. This agenda is not going. No. So maybe in the. In the European Parliament we have also some discussions. But I think that anyway this situation is not.

Dr. Ignacio Bartesaghi: Is not comparable with 2019 situation that as you know, we close already the agreement and then because of the green deal in the. In Europe they try. They started a new negotiation because of the sustainability issues and environmental aspects. Okay, now we add in the sustainability chapter, we add new compromises. In that sense we accept that as Mercosur and we ask Europe to change some things in other chapters. That was part of the negotiation and that was okay, now we need to wait. We need. If you saw if we solve the problem in France, if we solve the problem of the farmers in Europe, but it's a euro problem from our side. Argentina, Brazil, Paraguayan, Uruguay will sign the agreement. No problem. Even Milei. Okay, Milei is not saying this is not my agreement. I think that is not going to happen.

Dr. Ignacio Bartesaghi: I want to go with Trump and I wanted to have my future agreement with Trump. That is Milei idea, but he will sign anyway this agreement. So all the attention is in from the Europe side. And the problem there, Richard, is that at the end I think that the problem in Europe is not the Mercosur European Union agreement, it's an internal problem. The discussion in Europe about so hard regulations is another discussion. The discussion in France about agriculture is another discussion because you Mercosur products, agricultural products are not going to increase a lot in Europe. That is not going to happen. And agriculture in Europe is not so important in terms of the economy. Agriculture in Europe is not so important in terms of France. It's important in terms of society, migration, internal migration and other issues. So what we can see from.

Dr. Ignacio Bartesaghi: From this side is that they are saying things that will happen because of trade of this agreement. That is not, that's not going to happen. We're not going to bite. All Europe with our products in agriculture and also in the industrial products are not going to invite Mercosur markets. So I think that this discussion is very complicated because it's about other issues. It's about other things that are going through Europe and the relation between the European Commission and the time of the partners of the European Union of the countries of the members that in some cases they need more time to adapt or to deal with so high regulations because as you know Richard, Europe wanted to be in the number one of all the regulations around the world.

Dr. Ignacio Bartesaghi: So that is that has impacts in Europe and in the farmers of Europe because they don't can use so our chemical to produce because it's forbidden but that is not forbidden around the world. So we can use it but Europe cannot use it. So they lose competitiveness because we that the chemicals that they can use or our chemicals that they can use the farmers are more higher than the what we use here. The discussion is. It's okay the discussion but the problem is more from the Europe side than from Mercosur side in from my point of view.

Richard McColl: So the Mercosur of side is obviously you're saying far more flexible, far more open to dealing and and the issues come from within Europe and the European Union and of course the geopolitical situation over there which is the tensions that are as you would say the. The push and pull of different tensions and the economies within the European Union. And you mentioned the countries of course who are opposing any agreement. You mentioned the French, the Austrians, Poland, the Netherlands. But then you have two big economies like Germany and Spain who are in favor. You say maybe Italy. We haven't seen where they're going. There's so much going on and of course any ratification will be blocked if the country's making up 35% of the population of the block are in opposition. And and so it's Mercosur are just watching and waiting I suppose.

Dr. Ignacio Bartesaghi: Yeah. Is we're watching and waiting now. Now there are some. For example my the foreign minister of Uruguay is having a discussion now in Brussels. So they wanted to have information about the process. So the process is ongoing or it's already stopped? No, the process is ongoing but is not from our side. The the decision of Italy if Italy is going to support or not because in that 35 you say in Richard, Italy is the the breaking point Italy. So we have to imagine what are going to be the concessions of the European Commission and von der Leyen to Meloni about. Okay, support me in this then I will give you some exceptions in migration, exceptions in all other policies that Meloni wanted to talk with Europe and the same with other countries. And that is an internal discussion that is far away in Mercosur.

Dr. Ignacio Bartesaghi: So that is important and complicated complication thing for us. It's like a picture that we see the picture, but we are not actors because it's going to be at the end a decision of Europe. Yeah. In a new international context. It's last week I, I, I read a, a speech of Macron that said something incredible. The future of France and Europe will be with Latin American countries. That is incredible, Richard, because if the future of France and Europe will be with Latin American. Oh please, Macron close this trade agreement with Mercosur that is so important in terms of cooperation. Because this is important to tell you the impact in terms of economics, in terms of GDP, in terms of trade is not so huge of this agreement. It's small.

Dr. Ignacio Bartesaghi: The impact will be more important in geopolitical issues, especially for Europe, because Europe has a great problem in the moment. Europe is in the middle of the geopolitical war between China no. And us and it's not part of that party. And Europe is going to be more complicated in this issue. If the solution of Trump in the war of Ukraine will not take in account the opinion of Europe will solve this problem only with Putin and they will inform China. So what is the role of Europe? So in that new international context, Europe needs new partners, strategy partners. And this is the policy that the European Commission wanted to achieve with Africa and with Latin American. They need Latin American countries and it for our countries and for Mercosur countries.

Dr. Ignacio Bartesaghi: If Europe wanted to have a new kind of relation with us and they wanted to compete with China that won a lot of space from the US and Europe in the last two decades. Okay, give me something. Not only you can say me. You need to achieve my regulations. No, no, no, please, slowly. I wanted to achieve that regulation because we are aware about climate change. We, we are aware about climate change in Mercosur, but we are also aware that we are not developed economies. We are developing economies. So to reach this kind of regulations, so, so difficult to achieve, we need time, we need support, we need cooperation. Because you are the rich economy. We are not rich economy. In that discussion is also important.

Dr. Ignacio Bartesaghi: The time we, we wanted to go there and the discussion of the, I think that part of the world is to go there and to, to take in account of what is going on in environmental issues. But the key issue is the time. The time and the support you will give me to go to that point.

Richard McColl: It's, it's incredible. I mean I'm in Colombia, you're in Uruguay. But it's incredible to think of Macron saying that Latin America is, you know, the future of Macron in his incredibly weak position. But it still means a lot. It still means a lot to have that to not be the kind of forgotten continent which in many ways we often feel. But you've been bringing in the whole sort of geopolitical conversation into this. And of course you've mentioned President Trump and you've mentioned President Milei in Argentina and this relationship that they appear to have. You never know. But of course would sign America agreement with the European Union. He's, he's far more pragmatic than you know, we can imagine from the images because we know that there's Chinese investment and deals with Argentina.

Richard McColl: And of course, and of course Milei says he won't work with communists, but of course he's too pragmatic to, to cancel anything there. So I kind of, I wonder. I think Milei could also, he could obviously make some influence and have some influence with Meloni in Italy, you know, the politically aligned kind of thing with Trump as well. But how you know, one of the things that really always jumps out is what was written in that original treaty ruling out bilateral trade between member states of Mercosur and third parties. That this because of course Milei we talk and Trump Milei wants us a free trade agreement straight with Trump. Of course this would go against, you know, the, the remit within Macro and Uruguay has been pushing for a deal with China for some time.

Richard McColl: Can we see, can we see the original treaty being modified to benefit member states independently of one another?

Dr. Ignacio Bartesaghi: Very important question. Uruguay try as you said Richard to sign an agreement with China. And the negotiation of this government was to try to push a reform in the treaty or to have a kind of authorization, a kind of fast track to okay, you know, why you can sign with China. We don't want but you can sign. We tried that with Bolsonaro administration and with Guedes in particular. That was in force of the. But Itamaraty wasn't so in force of the international relations in these aspects. Guedes was important in that. In that issue. And the conversation with Brazil was, okay, maybe I will accept a free trade agreement with Uruguay only with China, like the first step. And then we can see if the whole Mercosur will okay, we'll sign this agreement as a whole. This discussion was ongoing.

Dr. Ignacio Bartesaghi: We signed a feasibility study with China about the impacts of future free bilateral trade agreement. And then Lula appears. Lula won the elections. And Lula vision and international view of Lula is totally different from Bolsonaro. Brazil wanted to be the leader of Mercosur who wanted to be the country that will has the relation with the bigger economies. And okay, the first conversation with Lacalle Pou was Uruguay. You don't hurry? No, please, you're in a rush. Don't worry. We first we're going to close with Europe and then hold Mercosur will close with a China with China free trade agreement. Say the message was very clear. You do?

Richard McColl: Why?

Dr. Ignacio Bartesaghi: You're not going to do this alone. It's my decision. It's not your decision. And that message was of course sent to China like saying, okay, you are trying to talk with Uruguay in a bilateral way. This is not going to happen. If we close an agreement will be as a whole. Why? Because we are in. In technical view. We are a customs union. We need to negotiate all together. It's not possible to go alone. That is in the technical, in theoretical. If you read the papers, yes, you read that. But we never achieve that objective. We are a thing, we operate like another thing. We're not a customs union. But that discussion is okay. It's a. Is at the end. Brazil is saying that to China. China said to Uruguay, okay, so now Brazil is telling me that we're going to be all together.

Dr. Ignacio Bartesaghi: So we will. We will wait Brazil. But Brazil at the end wanted with China everything richer. Wanted BRICS wanted policy. Wanted cooperation. Wanted investment. Wanted everything. Not trade, not free trade. Brazil is not thinking in open economy with China. Argentina of Milei is not thinking to open the economy with China because as you said, it's focused in the possibility to sign a free trade agreement with Trump administration. The difference between the two situations are that in the case of Milei, imagine that Trump is called Milei or travel to Buenos Aires and tell me, okay, let's sign a free trade agreement. Milei is not going to ask LuLacalle Pou. I can, I can. No Milei is going to jump to that swimming pool. Yeah, because it's from on the other side. It's the US is Trump and it's Milei.

Dr. Ignacio Bartesaghi: Then you have to we have to imagine if Milei is going to go out Mercosur, how is going to be the discussion in Argentina that has very strong industrial relations with Brazil in terms of inter regional trade? The discussion we don't know. But the decision of Milei for sure is going to be okay. I will jump to that swimming pool, to that opportunity. So I think that the discussion to reform Mercosur to be more flexible is not going to happen because we don't have conversation between Lula and Mile. So it's not possible to. To open this negotiation. It's necessary. Yes. Is the opinion of Uruguay. Yes. It was the opinion of this government in Uruguay. Yes. But in the case of. Of.

Dr. Ignacio Bartesaghi: Of this new reality, what we can see is that Milei is going to break Mercosur enforce not in legal discussion, because if he has the opportunity of free trade agreement with the US he will cut. Yeah. He will say yes and then he will start another problem. That is how he will solve Marco's issue.

LatinNews

This podcast is brought to you by LatinNews, the leading source of political and economic news and analysis on Latin America and the Caribbean since 1967. Access LatinNews Full portfolio of reports at www.LatinNews.com

Richard McColl: Is this practical or impractical?

Richard McColl: Relationship between Milei and LuLacalle Pou. Right now I'm thinking right back to that photo opportunity last year, which looked a little bit staged. They did not look happy alongside one another. And this is as you. As you are stating, obviously it's a real obstacle to a productive Mercosur, this relationship, or lack of relationship between Lula and Milei. How. How do you see this playing out? Because obviously rather than their political ideologies, they need to work together. The two countries are, you know, pivotal to one another.

Dr. Ignacio Bartesaghi: Totally. You know, the. The backstage of that picture of the Montevideo summit, it was incredible because Lacalle Pou needed to ask Milei, please can you stay here in the picture Because Milei wanted to be in that picture with LuLacalle Pou. So it was very strong negotiation with. With Lacalle Pou telling Milei, please stay here, please let catch our hands. Incredible, no? Yeah. One picture, but the message is very clear.

Richard McColl: Yeah.

Dr. Ignacio Bartesaghi: In the history if you. Because Mercosur started in the 90s, 1991, we signed the. The Treaty of Asunción. But the history of Mercosur richer started before in the 80s and started in a very important and strong relation between Sarney and Alfonsín. Argentina, Brazil. Brazil, Argentina. In that moment they started to close different agreements and also related with saved agreements also. So because they. The. The agreements that they started to sign in the 80s were very important for the peace of the region. So the relation between Argentina and Brazil is very strong not only in trade, these are really natural partners. So when you can see that no conversation is at of course that in other levels things are happening between Argentina, Brazil.

Dr. Ignacio Bartesaghi: But the problem is that the president of Argentina and the president of Brazil they are not having a conversation and you need conversations. If you in any discussion of Mercosur you need Brazil and Argentina having the conversation because I always say the same that Mercosuris Argentina and Brazil decision and then they communicate that decision to work through Paraguay and Uruguay. Okay, that is Mercosur. Always they reach a decision and they inform us the decision when we accept that. And now it's more complicated because Mercosur include new members, include Venezuela that now is suspended. But Venezuela is totally different economy to social, cultural, nothing with with Mercosur countries. But because of policy reasons, because of that time ago, because of Lula and because of Dilma Rousseff and because the Kirchners in Argentina, because in our case Mujica they decided to.

Dr. Ignacio Bartesaghi: Well, Lu remember L and Parag they decided to have Amarosur more like a policy forum and not like economic integration process. So they decided Venezuela must go in and now Bolivia is also a full member of Mercosur. And that is more complicated because we add more problems to Mercosur. This is a family, a couple that have a lot of problems and decided to have more times to solve the problems. It's not correct. So we need to solve our problems. We need to discuss about what Mercosuri wants in the future. We need to discuss if we. If it is possible to have America more flexible because it's. It's impossible to have the same opinion about if we wanted to go with China, with the U.S. with Europe, with Japan.

Dr. Ignacio Bartesaghi: So if we cannot have a only one view about the internalization of Mercosur work we need more flexibility and that is part of the discussion. But for to have that discussion we need Argentina and Brazil having the conversation. And that is not going to happen. It's not. It's not happening at the moment. And I think that Richard, this is not going to happen the next month because LULA is not comfortable because of the relation between Milei and. And Trump. We don't know this relation. We see this relation in the media. It's very okay, we don't know, but it's a relation with Elon Musk, it's a relation with Marco Rubio. It's a relation that is. We are. We are waiting what is going to happen with that relation. But imagine Lula in that situation.

Dr. Ignacio Bartesaghi: Yeah, it's not comfortable, Lula, because the leader of the relation of all Latin American countries is Argentina, not Brazil. So that. That problem is also part of the difficulties to. To. To. To have Brazil and Argentina having this conversation.

Richard McColl: See, that shifting let's say of the. Of the spokesperson for. For this region with the US Being Milei and no longer being Brazil is. Is a big deal and is obviously playing into the polarization between the two countries and within domestic politics. Indeed the relationship between Milei and. And Trump at this point in time, I think we could probably suggest it's more mediatic. But. But who knows where it goes I mean who knows where the predictability on this one goes. If we go back just slightly and look at. Look at the EU agreement or the proposed EU agreement, what do you feel it would mean for Mercosur if and when this. This deal is signed and goes through.

Dr. Ignacio Bartesaghi: For Mercosur is it's like a new stage. Because the more important thing that happens to Mercosur in the last 20 years was this agreement.

Richard McColl: Yeah.

Dr. Ignacio Bartesaghi: Was the sign of this agreement is not enforced. But anyway it was the more important thing in 20 years. Why? Because Mercosur dynamic is so stable. It's so problematic that we. If you. When you signed an agreement with Euro because it's European Union. It's not a. It's a. It's a real important economy. It's a really important actor international relations. And so it's like in football, Richard. It's like playing in. In. In. In the B Liga B. No. And start to. To play in A is. Is giving more life more for Mercosur if this going to be enforced. And also Mercosur will want credibility if we have this agreement. Because this is also very study around the world. But. But when you sign an agreement you catch the attention of other economies. Yeah. So if you catch. If you.

Dr. Ignacio Bartesaghi: If this agreement will we put in force Japan, South Korea, China. Okay. They will knock the door. Okay. I want an agreement with you. So the. This will have another impact in the imagine of Mercosur around the world. And that is important because the credibility of Mercosur has a lot of problems the situation of course the whole world is looking through the television what is going on in Brazil and Argentina and what is going on with Argentina and Milei. But if really you close this agreement I think that the position of Mercosur will be another. It's will be the most important thing after the close of the protocol Ouro Preto Protocol that we closed in 1994. So it's really important for the future of Mercosur. It's not only because the impacts in the economy, it's not because this is going to be okay.

Dr. Ignacio Bartesaghi: Now we close this agreement and we're going to export a lot and our GDP is going to Greece and Mercosur will transform in a, in a developed block. No, no, no. It's not that, it's not about that kind of impact. It's about the other important things and opportunities that will be open with this agreement in this international context where Europe need new alliance. So this is what I think is going to happen is it's difficult to talk about this kind of impact because our methodology when we work in studies of the impacts of trade is more easier to say, okay, we will increase our export and the imports in this amount and GDP is going to increase this amount. It's okay.

Dr. Ignacio Bartesaghi: But when you talk about geopolitical issues, policy issues, cooperation, future investments in new areas, for example green hydrogen, critical minerals or all these kind of things that are part of the new discussion in the international agenda, Europe and Latin American countries, Europe and Mercosur together, it's an important discussion. So for Mercosur, it's totally important to have the opportunity to put in force this agreement and I think that will give more years of life.

Richard McColl: Definitely your football obviously metaphor there, it's like playing with the big boys coming up against the big boys. But I see it more as I see it, as well as a maturity on the world stage, there's this acceptance. It's a signed off with Europe. As you say, the consequences are greater than the actual deal because then the other countries start looking at it and saying oh, they're serious, you know, it's working. I, I can understand that entirely. And, and you say your last comment there, it gives it sort of a longer lifespan because, well, I mean if the deal doesn't go through, I mean Mercosur is going to, you know, suffer an existential crisis.

Dr. Ignacio Bartesaghi: Yeah, totally. Of course, yes. And that, and you add mileage position to that. Because if we, if this agreement never will put in force, Milei is going to say, okay, so I can go with the US I can open because this nothing happens, we close agreement that will never be enforced. So at the end they are not agreements. So yes, the critical situation of Mercosur if in the next year we now have information that the process is ongoing, Milei is going to push and push more and more the necessary of a reform of Mercosur. And because in in the view of Milei he wanted to have an open economy and he's running for that. And in the case of Paraguay totally different. But why is comfortable in this situation? It's always comfortable in this situation. Because Paraguay has a.

Dr. Ignacio Bartesaghi: A strong relation with Brazil is catching investments because the low prices of production Paraguay. So Paraguay is increasing. It's not a problem for Uruguay. Yes, it's a problem. But on the other hand, the next government of President Orsi is has a different view compared with Lacalle Pou. Why? Because he's more near Lula and he is more near Mercosur and he wanted a Mercosur all together. So Orsi, the next president. President of Uruguay is not going to push flexibility of Mercosur is not going to support Milei in all the ideas of Milei is going to support LuLacalle Pou. So this is going to be like. Maybe Milei is going to be alone. Yeah, but it's not alone because he's alone maybe with Trump so. Or maybe with Elon Musk deciding some important investments in Argentina. You never know. At the moment we need.

Dr. Ignacio Bartesaghi: At the moment this is a history for media and for a nice movie at the moment. But we can have some results in the next month. And of course other members of Mercosur are paying attention to that situation.

Richard McColl: And finally you obviously you mentioned the expansion of Mercosur to include well, suspended Venezuela and Bolivia. Is there a move maybe to include further countries?

Dr. Ignacio Bartesaghi: I don't, I don't. The idea of Brazil always was to include more countries because Brazil Mercosur is small for Brazil. Brazil always need whole South America. Remember UNASUR, Richard?

Richard McColl: Yeah.

Dr. Ignacio Bartesaghi: The idea of UNASUR is not an Argentinian idea, it's a Brazilian idea. Because Brazil wanted to be like the representative of. Of South America to have a role in the UN no console and to. But for that Brazil needs more than Mercosur. Yeah. So the idea of UNASUR there was to have more, more, more and more countries. And yes, Panama is. It's going to be part of Mercosur, but not like. Not. Not like a full member, like associate member, like a full member. I. I think that it's not going to happen. Or Bolivia it's okay in the future, maybe Colombia, but I think it's not going to happen. It depends. But for Brazil to add Venezuela and to add Bolivia was a political victory.

Richard McColl: Yes.

Dr. Ignacio Bartesaghi: Because Brazil wanted also always to represent South America. I am the leader of South America and that is the reason because I need to be to have a seat in this, in the UN Security Council because I have the voice of all These countries. That is, that is not true at the moment. It's not true. I think that the, the worst international policy of Brazil in the history, Richard, was that Brazil never achieved the real representation of the whole South American countries. And that is incredible. So the Brazil needs to work more in that to give more concessions and to have. Okay, now he's leading with Argentina. Argentina is the natural partner of Brazil, but now Milei is fighting with Lula in that issue. So it's a real problem for the future of Brazil decisions.

Richard McColl: I, I see that obviously that Brazilian situation is painful for Lula and Brazil. Of course. I just, I mean, I only ask about the expansion. Panama, of course, a very interesting prospect because especially in the light of the recent visit by Marco Rubio and of course his thinly veiled explanations that Panama have to stop doing so much business or permitting so much business with China. And, and of course, you know, a recent event of Colombia being made the example of any pushback against Trump as correct or incorrect as wherever you stand politically. You. I mean, we have a lame duck president in Colombia in Gustavo Petro right now. But Colombia, for example, has always put all of its eggs into a trading deal, trade deals with Colombia and they're going to have to look elsewhere.

Richard McColl: That's why I would think that Mercosur is very attractive for other Latin American countries.

Dr. Ignacio Bartesaghi: Yeah, yeah. And I think that in the case of Mexico now with the problem that is going on through Trump decisions, moreover than this month, that they are going to wait and to negotiate if they put on all the tariffs. Yes. I think that in this new international contact with Trump, Mexico, Canada, they will look more to Latin American countries. They will look more to. To Brazil maybe. Why not? Or to Mercosur Canada, for example, we have a negotiation with Canada, Mercosur, Canada. Maybe now Canada will say, okay, I need to rush in this negotiation because I have Trump, so I need to sell my products to other place. So that is part of things that I think is going to happen. And about Panama, it's important also because the trade relations of Mercosur with Central American are very slow.

Dr. Ignacio Bartesaghi: You know, Richard, we have a lot of opportunities to increase our relation with Central American countries. So the accession of Panama like associate member is a very good news and a first step maybe to involve other countries of Central America to be part of Mercosur.

Richard McColl: This is it. This comes back to that maturity and of course the consequences of almost an effective signing with Europe, which would get other countries to sit up and look at Mercosur I think it's a fascinating time to be involved in Latin America especially, obviously with what is going on in North America. There could be more, let's say, North America, Central, south, including Mexico, of course, there could be more agreements in coming months and coming years. It's definitely something to watch.

Richard McColl: Can I just take this moment to say thank you so much to Dr. Ignacio Bartisaghi for his time and insights on what is going to be, I would say, a very pivotal year for Mercosur, thinking of the European Union, the free trade agreement there, and potential maturity of this trade bloc in order to negotiate and of course, create new alliances across the world. Dr. Ignacio Bartisaghi is the Doctor of International Relations. He's a director of the Instituto de Negocios Internacionales at the Universidad Católica del Uruguay. Thank you so much for being on The LatinNews Podcast.

Dr. Ignacio Bartesaghi: Thank you, Richard. It was a pleasure.

Richard McColl: My pleasure's all mine. Remember, everyone to share, obviously, The LatinNews Podcast. Talk about it and we'll be back in a fortnight's time discussing further elements and issues from the region. Thank you again and goodbye.

Outro

You've been listening to The LatinNews Podcast. For more news and analysis on Latin America and the Caribbean, visit www.LatinNews.com.

Jorge Morgenstern

Jorge Morgenstern is the Chief Economist (Economista Jefe) at Galicia Más, based in Buenos Aires, Argentina. With over 18 years of experience in Latin American economics, he specializes in analyzing Argentina, Chile, and Uruguay. Before joining Galicia Más in December 2024, Jorge spent 15 years at HSBC as LatAm Economist Director.

He holds a graduate degree in Economics from Universidad Torcuato Di Tella and brings deep expertise in economic research, making him a leading voice on Argentina’s transformation under President Milei.

Intro: Welcome to the LatinNews Podcast, a fortnightly deep dive into key developments from across Latin America and the Caribbean. Here's your host from Bogotá, Colombia, journalist Richard McColl.

Richard McColl: This is the LatinNews Podcast. I am your host, Richard McColl here in Bogotá, Colombia. And this week's episode, we're going to be addressing the world's issues in Argentina, of course, incredibly interesting what is going on. Lot of news out there, specifically about the government of President Milei and the economy that he is overseeing. And so this week we are very honored to have Jorge Morgenstern on the podcast. He's the chief economist at Galicia Más. Previously economist for. Chief economist for South America for HSBC. Hugely experienced in this field for the region. It is a great pleasure to have you here, Jorge.

Jorge Morgenstern: Thank you, Richard, for having me. Thanks a lot.

Richard McColl: You're there in Buenos Aires right now. I'm here in Bogotá. Two very different cities, two very different societies. And, well, we are all eyes are on the economy of President Milei's government there in Buenos Aires. And I think, well, certainly President Milei is a character that captures the imagination and indeed, well, does dominate some headlines. When you think of, well, Argentina being an economic. Well, I don't want to. It was a, it's a, it was a warning for much of the region when we take a look at Argentina's contemporary economy. But in terms of Milei and how he sees his achievements. And then, of course, I'd love you to put this all into context. He has overseen a reduction inflation. He does. His government appears to have a fiscal surplus. There's been the dismissal of 35,000 public sector employees, the closure of ministries and a reduction in Argentina's credit debt. So perhaps we could just jump in, Jorge, and say, can we say that up till now, President Milei has been doing a good job?

Jorge Morgenstern: I would say that in his own terms, but also in the terms of the position. It's difficult to argue with that. I think that even again, the opposition may recognize that he's doing a better job than what they thought, that he's stronger than what they thought he was going to be. So for critics is also a tricky situation. Just to give you an image, we are recording this the day after Donald Trump's inauguration and thinking that yesterday we saw the image of the Rotunda at the Capitol with Javier Milei inside, just two rows behind all the former presidents of the United States. He was there with Giorgia Meloni and other foreign dignitaries. That was really unexpected. That was something that I don't know. Even with, at the beginning of Milei administration, it would be hard to believe that was going to happen even more so during the 2023 electoral campaign. That was something that, you know, it's still difficult to digest and understand what will it mean for Argentina. But again, domestically, yes, he's doing a job in his own terms, that's very good. And I think that again, even for those, for the critics, so far better than what they. They have been saying.

Richard McColl: So, I mean, he came in with this idea of, you know, the shock therapy, and that's what he's done. But how can we, how can we point to him being able to consolidate stability, let's say in 2025, in a year when he's got midterm elections?

Jorge Morgenstern: Yeah, I mean, the shock therapy was almost like a tactical strategic decision. It was in opposition to what the Macri administration had done, which was a very gradual attempt to reduce the fiscal deficit and in general to tackle the problems that they saw with the government. In the case of melee, they understood from the beginning that they did not have access to markets, that they will not going to have access to markets. There was no way to fund a gradual transition. But also they understood that probably the Argentine society was better or the situation was better handled with a doing first and asking for permission later. You know, better asking for. Being sorry instead of asking for permission. And that's what they've done. It's you first do all the significant adjustment, at least what's within your realm of possibilities. And if that has positive results, the people will behind you. But if you start to negotiate your way out of a difficult situation, probably you're not going to get there. That was the underlying assumption and indeed that was what they did and they were successful in doing so.

Richard McColl: As you say, we would say in English, he's taking no prisoners. He's doing what he said out to do, but not negotiating.

Jorge Morgenstern: Not negotiating. And you mentioned the midterm elections that are coming in 2025. Not negotiating. Is that a good strategy for the elections? It certainly was a relatively okay strategy for the first year. Maybe not negotiating has precluded him from having some victories. He has asked for Congress to approve two nominations for the Supreme Court and has unable to pass those, for example, but non negotiating as implied, that he is submitting the opposition with a stronghold of financial resources instead of sharing those. And when people see that at the federal level things are starting to improve, they might think that's the right way to do and start to pressure their own local governments. We have a very federal structure of government in Argentina, and that's in part what the 2025 midterm elections were going to be about. Whether the national strategy of dealing with government translates to the local governments as well.

Richard McColl: Do you think he'll be able to strengthen his support in Congress? Because of course he needs that support.

Jorge Morgenstern: Yeah, I mean, that's almost a given because he has so very low support. To, you know, to give you an example, is like having a really a third party candidate in the US coming to government. He did not even have the number of legislators in order to block a potential impeachment. He barely escaped other initiatives of Congress to override Vetoes. They required 2/3 of Congress and he barely got the 1/3 need to block it. For sure he's going to improve his position in Congress. The question is whether he's gonna be close to having a. It's a majority. And the answer is no. Very difficult. It's almost impossible. The other question is whether he's strengthening his position will be at the expense of what could be potential allies. The former Juntos por el Cambio, the coalition that ruled the country in 2016–2019, or at the expense of the opposition that we can call the Kirchnerists of the Peronist. And it's probably going to be more at the expense of the former. It's going to be more a question of having a small block that is closer to his ideas than to widen the, let's say, pro market or market friendly presence in Congress. That's what 2025 and the midterm elections, etc is about.

Richard McColl: It's a, it's a very interesting situation coming from such as, you know, as you say, like an outsider, that the, this disruptor image and then now having to obviously formalize himself in that way. You won't get a majority. But I did see statements of him calling for support. You know, imagine, look what we've done so far. Imagine what we can do with the, you know, the wind behind us. He'll still push through. He'll still go through. Even with a. Without a majority. It seems very, it seems very clear to me that he'll continue to push through without negotiating. Do you feel that's the same?

Jorge Morgenstern: Yeah, that's. That's probably going to be the case. And on that, I mean, the economy is the big asset that he has at the moment. And many questions will go back to the economic performance. I think that going back to the beginning of the questions about what has happened. It's clear that he got to government at a point in which the Argentine society was suffering with a level of inflation that they could not tolerate. So they were able to accept sacrifices in order to reduce that pain. Remember that Argentina had not only two digit annual inflation rates since 2007, but in particular inflation above 100% per year over the past five years. So in average, I mean, so when he got to government with inflation running at 7, then 10, then 12, and in the last month of the Kirchner administration, 25% per month, I think that you cannot, you have to agree with him that Argentina was on the verge of an hyperinflation. It was, there was some hyperinflation sense in the air. And when you get there, you know, people will be able tolerate maybe some policies that otherwise they would not. And if you get, if you are victorious on that, they might give you leeway to do many things that otherwise they wouldn't. And unfortunately, Argentina can give you an example on that. And this is something that will be referred a lot in Argentina in the near term, in the near future is after defeating hyperinflation and very high inflation in the early 90s, President Menem was able to be reelected to reform the constitution in order to be reelected even at a time where unemployment was rising to 2 digit percent and with the economy showing some strains already. So if we can extrapolate that to 2025 and think that, you know, maybe the population will be able tolerate things from Milei, thanks to him beating what could have been an hyperinflation moment, probably more than what you would have expected.

Richard McColl: And this, the word you use at tolerating is an interesting term because of course, you know, we look at the figures in Argentina, at the beginning of 2024, poverty exceeded 50%, but by the third quarter it's down to 38.9%. I mean, do we, can we say this is going to continue to drop, or are these, you know, severe measures of austerity going to create further issues?

Jorge Morgenstern: Well, first of all, the poverty figures in Argentina, those are a tricky story that if you go, I mean, you can go into a very long discussion whether those are a good measurement or not. The poverty line used in Argentina is a very strict one. You can say that maybe with the same standard used in other countries, poverty might be around a half of those numbers. But also the problem is that poverty related to income, whether your income is above certain amount of pesos that you need to buy certain stuff. In moments of such significant swings inflation, poverty goes up and down, like you said, 15 percentage points from one quarter to the other. And certainly that's not how people feel using that measure. Yes, poverty will keep going down because inflation has gone down and real wages are recovering after a significant drop in the first part of 2024. So yes, for sure poverty will go down from those levels, but going more to like what Main street will feel. The question is about the recovery of economic activity. One thing that you can, you know, that we know that's happening is that economic activity overall is recovering. It dropped significantly the first half of 2024. Bear in mind that 2024 was a year in which the harvest was much better than the drought ridden 1 of 2023. So overall the economy fell between 2.5 and 3% in 2024, but with a significant contribution of the agricultural sector because of the harvest. So the rest of the economy was probably falling around 5%. And much of that decline happened in the first half of the year. Yeah. So the second half of the year has been one of first quite rapid and then more steady recovery. There's this figure that we call the carryover effect to 2025. If the economy doesn't grow at all during 2025, in average you'll see GDP expanding 2% comparing to 2024. But the question, and we are getting closer to an issue that of course you have to discuss in Argentina at this point. The question is whether the exchange rate, the competitiveness of the economy will allow, let's say, a shock, full recovery or not. There's a risk that you can go into what you can call a jobless recovery. You know, Argentina has a number of opportunities or realities, more than opportunities, particularly in the energy sector that assure you that you're going to have growth in 2025 and you're going to have a strong platform for growth beyond. The energy sector is booming thanks to unconventional resources that are being exploited. The infrastructure for that was put in place years ago. Part of that with the previous government that is expanding now. Of course there's some investment to be done still, but that is something that will provide a base. The question is whether you can get the mainstream and particularly the urban areas to fill that progress.

Richard McColl: Sure.

Jorge Morgenstern: Besides the energy sector, there's a policy that the government passed through Congress that is basically a tax stability regime RIGI that gives you an idea like puts all companies with large investment on a tax scheme. That gives you an idea of what they are aspiring for the private sector to have in the future. No need to surrender your dollars, no limits to dividend payments, no limits to access to the FX market and corporate tax rate at 25%. There are significant investment comings within that regime, particularly in the mining sector as well as the energy sector. The mining sector is another one that is due to expand, maybe lagging a little bit. The energy sector maybe with production coming in 2026 and 27. But again, this is a primary sector. The other big sector that you can see booming in Argentina are the agricultural sector. And even with the exchange rate is on the verge of not becoming, not being competitiveness. They have very large specific taxation that maybe the government can begin easing this year. But again, although this is a sector that has a significant spillover in many cities in the country, this is not a sector that drives employment in the large urban areas. So the key question, and this goes back to the electoral discussion, is whether this recovery will be felt in the outskirts of the city of Buenos Aires, the outskirts of the city of Rosario, for example, to give you the two largest urban areas and whether will be enough for people to vote or they will be convinced by the opposition that this is not a good regime.

Richard McColl: So there are a number of things there. You talked about the improvement obviously in the harvest after the drought. I know we're early into 2025, but how are things looking environmentally for Argentina? Are there any predictions?

Jorge Morgenstern: Yes, they're not looking that good. I mean the different exchanges in Argentina that we look at, that usually they go faster in the predictions at the usda. They are, they are warning that we may have a not very good harvest in 2025. It's. I think things are up for grabs. To give you an idea, we, I mean during the last year we had 55 million tons of soybean production. This year is looking like 53 for according to the exchanges. But they are saying, look, this is likely to have to be revised downwards. It depends on what happens in the next few weeks. So I mean, we are looking outside, looking at the weather. I told you of the record that this was not a very hot summer. That's indeed the case. But also it's. It became a bit of a hotter one in January and it rained this weekend. And this is. There's a point in which you can argue that Argentina is a G20 country, but in January and February, you know, economists just put their hand outside and see how much it is raining. That's Basically the. The way we make projections, it has not rained enough. Probably we're going to have a problem there. And still in the first half of 2025, the agricultural sector is expected to be the main provider of dollars for the country. That's probably the more scarce commodity in Argentina. And that's one of several risks that we see for this year. Again, there could be a much better expectation for future years, particularly if the government is able to cut taxes on the agricultural sector. But for this year in particular, things are not that. Not that great yet.

LatinNews: This podcast is brought to you by LatinNews, the leading source of political and economic news and analysis on Latin America and the Caribbean since 1967. Access LatinNews full portfolio of [email protected].

Richard McColl: Okay, so we will be looking at the weather forecasts and of course, predictions for harvests in Argentina because it seems to me it's incredibly connected there. But we've also, we've skirted round it, but you've mentioned it, of course, the issue of US Dollars and foreign currency. And of course I think we should probably bring up the IMF right now, which is, you know, has been, I would say, is cautiously optimistic or moderately optimistic with the recent meetings with Milei and. But they will continue to call for Argentina to lift currency controls, update utility tariffs and improve fiscal adjustments. It seems to be what is going to happen. It seems to be something that will play out almost naturally under. You think so?

Jorge Morgenstern: Yes. I mean, going back to your points in reverse order, utility tariffs, they are much a much better reflection of cost now, around 80% of cost recovery compared to 50% at the beginning of 2024. And to some extent that also relates to what I mentioned about energy. Energy costs are falling because of increased production. So the effort in terms of increasing the tariffs in order to reduce the subsidies is not as significant as it was. You just have to keep more or less them stable in real terms. The fiscal adjustment, I think that is something that can be maintained. The fiscal equilibrium that the Milei government achieved, that is something that can be maintained in 2025, but something that I mentioned at the beginning. Maybe the big challenge is whether you are able to transmit part of this adjustment to provinces. Provinces have equilibrium, but they also have a significant tax pressure. Half of the taxes collected in Argentina are collected by provinces or are transferred automatically from the national government to provinces. They are in charge of around half of the public spending bills. So without them, it's very difficult to engage in any significant reduction of the tax pressure in the country and going to the FX situation, flexibilizing the controls. Yes, that's something that the government has been doing and we expect them to continue to do. Where I think is a bit of a more trickier point, particularly regarding the IMF and the government and also as economists like a third party observing is what type of regime are we going to go to? And the government has been particularly cagey about that. It's like, I know that political, sorry, not political. A professional problem that we have as a country, economists in Argentina, is that this government is not telling us what they're gonna do in many aspects. And we have to start to accept that, you know, they're not go. They say we might tell you what but not when. We might tell you our goal but not how. And this is a bit difficult to live with. You know, we don't, we don't have a very, you know, a public central bank discussing monetary movements in length or doing press conference every month. For example, what's going to happen with the exchange rate in the coming months. We know now the government has told us the exchange rate now moving at 2% per month. It's going to start moving at 1% per month beginning February. Okay. But what we don't know, and they are not telling us and at least not publicly to the IMF, is what type of regime are we going to have once that crawling peg is over, whether that will be a fixed exchange regime. Well, you need a fixed reserves in order for, if necessary, sell dollars, but mostly for people to know that you have FX reserves in order to defend a parity of the currency. And Argentina does not have FX reserves. There are talks that maybe they can get some from the IMF, but probably, I think it will be difficult for the IMF to lend money to Argentina to defend a parity on the currency that is out of equilibrium and they think the current one is probably out of equilibrium whether Argentina is going to have a floating FX regime. Milei said some, a couple of times and we take very close note of what he said. He said, well, we don't have reserves, but we are not going to need reserves because we're going to go to a fully floating FX regime, but people are going to have no pesos, so they're gonna not, they're not gonna be able to buy dollars and we gonna have no problem. I think that's a very risky, very risky move. Particularly, you know, before elections, before the October 2025 election. Remember that the elections the three elections at the end of October, because any volatility can translate into a potential political defeat and then a regime defeat. You know, this is really the test of the October elections is very relevant. If they pass a text that test, maybe they can do many things with regime. Some advisors to the government have said that Argentina cannot have a floating FX regime and probably will have to have a one with a strong intervention more similar to Peru. Some economists, we maybe agree with that the IMF at some point said that Argentina was going to have a regime dual in terms of dual currency regime like the ones of Uruguay and Peru. But the government strongly denied that because remember that back then at the beginning there was a promise of dollarization. So we still don't know that part. There's constantly an ongoing debate whether the current exchange rate in Argentina is too expensive or not. You can argue that yes, Argentina is an expensive country now for tourists that were flocking in 2022 and suddenly they see that the prices are more expensive than in London. You can argue that the exchange rate, if you look at the central bank buying reserves and the current account position for 2025 maybe is not bad. But again, because there are these developments in primary sectors coming that will make Argentina a country that probably is okay with a strong exchange rate. But that's a macro level issue. On the micro level, many companies have become accustomed to a closed economy with a lot of barriers. You are dropping those barriers, you are making the exchange rate more expensive. And you might see a problem of again how much this growth translates to jobs in the urban areas and how that impacts in elections. Unfortunately, the one thing that I cannot say is what's going to happen with the exchange rate once the government, you know, once the government moves towards the next step after the one day already announced, it's very clear that we are going to have that 1% crawl. Not very clear what's going to happen afterwards. It's very clear also on monetary issues that we have a regime in which they have a gap on money supply. That is a phase two quote unquote that they announced in July. We don't know how that's. What's the phase three gonna look like. And we are not that far from reaching the limit in terms of money supply. The amount of pesos being demanded by the public being the same as the pesos that they think is okay for the economy like to demand after the shock of almost hyperinflation. But this is something going back to the beginning that we Economists are starting to have to live with and it's sometimes uncomfortable. We understand they don't want to tell us what's the next steps. The IMF sometimes is the one that can pressure them into telling them like what are your career plans? Like if you were your. Like our mother telling, asking us for what our plans. And. But it's something that we have to see just to finish on the IMF. We have a document published by the IMF in early January that was the closing of what was the plan the program reached agreed upon under the Alberto Fernandez administration in 2022. That program ended at the end of 2024. There are negotiations on going for a new program, but you know, those things might take some time. I think that any significant news in the first quarter will be really surprising. It's most likely who have news on that later this year. Argentina does not have to pay a lot to the IMF, only interest payments. The two payments begin in 2026. The question is again how you interact that with the elections. And maybe one thing that we can discuss also next is with the markets. Argentina has not tapped markets yet. It has been paying down amortization but that will become very difficult starting from the second half of 2025. Whether investors would like IMF to agree with Argentina first. That's probably the case before you see lower yields and possibility of rolling over that.

Richard McColl: So do you think we'll see a short term agreement likely with the IMF rather than the longer term negotiated?

Jorge Morgenstern: I mean that's a possibility. This document from the IMF is quite interesting because they recognize that in doing an agreement that was a three year agreement with a lot of very nice targets, but having all those targets set towards the last year of the agreement, they lacked any leverage on Argentina. I think that they would like to avoid that. They obviously have a government that is convinced on the, you know, more or less speaks the same language. What Argentina still doesn't have is an opposition that also agrees with that a short term agreement, something that is more of a breach can be discussed. My feeling has always been that it's very difficult for the IMF to give extra money to Argentina. This is an issue for debate. Some think that particularly with the change in the US administration, it is possible that the IMF gives extra support to Argentina. But one possibility is a short term, more or less short term deal and Argentina trying to tap markets at some point during 2025 for which particularly you have to see that the elections are apparently Favoring the administration. Obviously, markets like what this administration has done. So any poll that suggests that they will do well, they will perform strongly at the elections, will be well received by markets.

Richard McColl: Well, I mean, it's positive, certainly. I mean, the challenge is ahead. Of course. They're very clear, they're very clear for us, you know, that to continue the disinflation to lower poverty, improve the economy and avoid any issues with the exchange rate and it seems, yourself included, economists seems to agree that inflation will continue to decline. And well, the forecast might be 28% decline and then the official expectation is 18.3. We do wonder about purchasing power. Of course, that's come into this conversation. But I know something we should probably discuss, as you've suggested as well, is Argentina's model something that you think could be exported and imitated around the region? We have elections coming up in the next couple of years.

Jorge Morgenstern: Yes. I mean, you know, there were talks of being wave around the start of the pandemic and then going back, you know, basically Latin Americans for the most part have been voting out their governments, exception being from Mexico, for example. The question is whether, you know, we have a new round of elections in 2025 and 2026. Let's, let's put it this way. Chile, Colombia and Peru are going to have new governments at some point in 2026. Some will vote in this year, some next year. Argentina, so you've mentioned this at the beginning was usually a warning, you know, usually what you don't want to look like, at least in economic terms, what will happen if they see Argentines, particularly now, thanks to the strong exchange rate, you know, flocking the beaches in Colombia and buying from shopping malls in Santiago. Whether we're gonna see, I want to be like them or not. That's one part of the discussion. The other part of the discussion really that I think elections around Latin America are about is not just economics. It's also the crime situation. The feeling that, you know, there's more of gangs going around the region. That type of crime is also an issue of debate and probably one that, you know, my might make an impulse for a change in government in these three countries that are the one having elections next. The Mileay government, of course, also comes with this idea of a strong hand against crime. And indeed some of the figures in principle suggest that in some of the hottest areas of the country, the city of Rosario, crime has gone down. So will, you know, will that be an image that can be portrayed as the one that Peru, Colombia or Chile have to follow. It could be the case. We were discussing the recent announcement of the. The team of advisors by Vicky Dávila in Colombia and they are full of melee acolytes. For example, what does it mean for Chile? Is the center right gonna take that motto? Is that more far right be the one taking it? That's difficult to say. And in Peru, of course, it's difficult to say, but it's. It can also be the case that if you, I mean, if you ask me what's the next Peruvian president? Who's the next Peruvian president? I can say that could be somebody that we don't expect. That would be the right answer, probably. And within that answer, maybe somebody that comes from like, with this sort of need for big reforms and need for tackling the government corruption, etc. And crime. That might be a message that, you know, that reaches people in a way that, you know, maybe it didn't a few years back. So let's see what happens. But of course, in principle, so far, you know, the Milei experiment, looking from outside is relatively positive. Of course, there's a lot of hardship, some of which was almost unavoidable because of the starting point. There is some procedures that you might want to do somewhat differently on how to adjust the public sector. Maybe not so much of a chainsaw, maybe more of another tool. But you know, it can be a very contagious message.

Richard McColl: As you said. We said at the very beginning, it's a very a. It's such a visual image. Obviously, the chainsaw, I think in Colombia it would be a machete, but it would be a fascinating evolution to watch, you know, the Milei experiment spreading across the region, modeled to be exported. Certainly, you know, one of Argentina's unfortunate reputations could then be sort of pushed to one side. But you're. I would say then overall, as we bring this to a close, Jorge, your outlook is positive. I mean, there are caveats, but your outlook is positive.

Jorge Morgenstern: My outlook is positive, yes. I think that again, I have to recognize that some of the things that the government will do, I don't know because they are not telling us and they are. I hope they have the message and I hope they know how to tackle the, you know, the situations that are going to come. My reservations are on some of the methods. Yes. But also knowing that, you know, maybe as I said at the beginning, the strategy require the methods not to be nice ones. They had to be mean in order to do something. That was part of the idea. Another big question is whether the world is going to help Argentina or not or if it's not going to help Argentina, will that be too much? We mentioned the weather, of course, the strengthening of the currency and particularly what happens in Brazil, whether Brazil, how does Brazil perform, whether the currency of Brazil depreciates in particular, that's a problem. US Dollar strength in general is usually negative for commodity prices. That's another risk, a potential, a change in geopolitical landscape and the potential for risk of aversion against EM currencies or EM bonds like the ones that Argentina will need to issue at some point. Those are things that are still risky. And so far the regime is a bit RIGId, particularly on the exchange rate side. But things look as if they could be positive. And again, the midterm elections will be a big test on whether Argentina, Argentinians want to keep things more or less in this realm. Maybe at some point changing, but still relatively market friendly or they think that no, you know, we better change track again and swing the pendulum back to the other side.

Richard McColl: Well, we will see. Well, all eyes will be on Argentina, of course, for October's midterm election, which seem to be absolutely, as always, pivotal. Let me take this moment to say thank you so much to Jorge Morgenstern and Buenos Aires. He's the chief economist at Galicia Más, previously chief economist for South America at HSBC. Hugely experienced in the field. It has been a fantastic conversation getting further, you know, deeper insights into what may be happening and what could potentially happen in Argentina in the coming years, months and years. So thank you so much for your time and for coming on the LatinNews Podcast.

Jorge Morgenstern: Thank you, Richard. Thanks a lot for having me. And let's see if we can keep watching Argentina developments and catch up later.

Richard McColl: Oh, definitely. I think in a few months time we can revisit this conversation and check where we got things wrong and where were right. And hopefully it's all positive though in the end. So I've been Richard McColl, your host here in Bogotá, Colombia. This has been the LatinNews Podcast. Thank you for listening. Remember that we release a new episode every fortnight dealing with issues from the region. Subscribe, tune in and share. Goodbye.

Outro: You've been listening to the LatinNews Podcast. For more news and analysis on Latin America and the Caribbean, visit www.latinnews.com.

Paul Harris

Paul has more than 20 years of experience in the mining sector in investor relations, communications, research, and news reporting roles, and over 16 years of experience in the Colombia gold sector. Paul founded the successful CGS Copper and Gold Symposium in Colombia. He has written for the industry-leading publication ‘Mining Journal’ since 2015 and has been a Kitco Mining anchor since 2022. Previously, Paul spent five years in Chile reporting on the copper sector for CRU and Metal Bulletin. Paul received a BA in Business Administration from the University of the West of England, UK; and a MA in International Relations from the University of Chile, Santiago Chile. He is fluent in English and Spanish.

Intro: Welcome to the LatinNews Podcast, a fortnightly deep dive into key developments from across Latin America and the Caribbean. Here's your host from Bogotá, Colombia, journalist Richard McColl.

Richard McColl: This is the LatinNews Podcast. I am your host Richard McColl here in Bogotá, Colombia. Happy New Year from all of us. This is the first episode for 2025 and we're taking on a great subject this week it is no less than mining and we'll be looking at Central America and we have our very special guest. He's a journalist, he's Americas editor for the Mining Journal, senior editor for Kitco, and he organizes the Colombia Gold Symposium. It is Paul Harris on the LatinNews Podcast this week. Paul, welcome.

Paul Harris: Hello Richard. Thank you for having me on.

Richard McColl: Oh no, it's a great pleasure to have you on. We haven't dealt with mining in the past on the LatinNews podcast so it's an important one to discuss because of everything that's going on in El Salvador, Costa Rica and of course linking it to Panama and a little bit to Mexico too because of all the arguments and political developments in this part of the world. Perhaps we could talk about El Salvador under President Bukele at the moment and some of his decisions because I mean it was very recent that he pushed through that bill. We didn't really have to push it through with the vast majority. He has to wait once again. Permit, is it open-pit metallic mining?

Paul Harris: Well, he's. El Salvador has deposits of gold. The gold price has had a big run up in value in recent years. It topped out about $2,800 per ounce at the end of October. It's currently around $2,650 per ounce. So his thinking is we've got the gold in the ground. The gold price is very high. If we dig it up, we can sell it, we can make some money. And presumably he's got a plan of what to do with that money. There's a lot of poverty, there's a lot of need in El Salvador. He sees the gold deposits of the country as a resource that he can use presumably to help improve the commonweal in his country.

Richard McColl: Yeah, I mean we look at it as 27% of El Salvadorans that live in poverty, a huge number in a country of 6.6 million. But if we put it into context, of course it was the left wing government previously that in 2017 you know, prohibited and outlawed this and I guess Bukele has said, you know, it's absurd, this is exact words that they don't do so. But he has made some claims about how much gold there is. Perhaps you could give us some clarity on that.

Paul Harris: Well, yes, I think maybe he was a fisherman before he's a president, because, you know, the one that got away is, you know, this big. And the reality, maybe it's more like that. You know, it's difficult to say. There needs to be more exploration. But one reference point or one touch point that we can look at is the international arbitration case that was brought against El Salvador a few years back. I think 2017, 2018, before ICSID, that was Pacific Rim Mining and OceanaGold. And they were claiming, I guess, expropriation of their El Dorado deposit. And they were seeking 250 million dollars indemn. Indemnization, which is quite a little bit less than the billions that the President is claiming is underground in his country.

Richard McColl: And can we say that maybe there is that amount? I mean, as an, as a mining expert, someone who's read about Central America and so on, can we say that El Salvador does have these kinds of amounts? Or is it just a bit of a pie in the sky?

Paul Harris: It's, it's a little bit of both. So, for example, the value of the gold in the El Dorado deposit will be substantially higher than that $250 million today because the gold price has gone up substantially. So that could be, you know, well over 500 million worth. There could be other gold deposits there needs to be more exploration to determine that. So at some point, yes, it is a bit of pie in the sky, but it's not perhaps beyond the realms of possibility.

Richard McColl: Yeah, I mean, look at these statements. He said that 4% of the country's gold deposits, I mean, these are potential gold deposits, would bring in $131 billion, a figure representing 380% of the GDP. I mean, these are pretty incredible figures.

Paul Harris: Y. Yes. I have no idea where he got those from, but there's quite a bit of extrapolation there. And yeah, I don't think there's really much basis for that at this moment in time.

Richard McColl: It's an interesting one as well. I mean, you can see the. You can see the importance. You can see the importance of the necessity in a country like El Salvador. But sort of mineral. I mean, we have to look at it, mineral production, and this kind of ties into Costa Rica a bit. Mineral production has never dominated the region's economies. And if we look over at Costa Rica under President Chaves, this is a country that has staked its whole economy image and everything else on being a global leader in environmental and sort of ecotourism. Global environmental image of Costa Rica. I mean, this could be damaging for them in terms of President Chaves trying to push through an open-pit mine there close to the Nicaraguan border.

Paul Harris: Well, yes and no, Richard. Yes, it could be damaging. But having such an intense sole focus is also potentially damaging. During the two years of COVID shall we say, the tourism sector basically evaporated and that left Costa Rica in a very difficult position. So diversification of the economy is always a sensible thing to do. Fortunately, Costa Rica and El Salvador have means of diversifying their economies. Whether the people there choose to accept those or go with those or not is another question.

Richard McColl: And these mines, let's say El Salvador and in Costa Rica. I know that El Salvador Bukele has been interesting because he said that the legislation will grant the Salvadoran government sole authority over mining activ in their country's land and maritime territory. But it'll have to bring investors. And who are we looking at? Do we think?

Paul Harris: Yeah, well that's politicking, Richard, because government, the state owns the subsurface resources anyway. And so in that respect he's just echoing or repeating something that already exists. And this is pretty much the case in every country in the world. The state owns the subsurface resources and they give concessions to other companies or third parties to exploit them. So potentially he would be looking at presumably Canadian listed companies, maybe Australian listed companies, or even companies from further afield, such as China, the professional miners that have the knowledge and experience and the wherewithal, the investment to be able to come in and put a project together to exploit these resources.

Richard McColl: And therein comes the question, of course, Bukele, the strong man. Obviously we know that the incoming president Trump, he likes a strong man. He might, there might be some sort of relationship there to not prohibit, but let's say dissuade a Chinese investment in El Salvador. How do you see that panning out?

Paul Harris: I think, you know, we need to look a little bit closer. You know, there's a lot of opposition from environmentalists, from human rights groups, from the Catholic church in both countries. And it's legitimate to have concerns over mining, particularly so mining. But mining can be done in a very safe, controlled manner. The mining sector has progressed a great deal in the past 10 years in these aspects. ESG, environmental, social, governance aspects are now sort of top of mind for many mining investors. Many governments and obviously the mining companies as well. And so in terms of environmental protections, water protections and the ability to actually improve the environment in addition to doing more for the local communities in which a mine is based, you these are aspects that have really progressed over the past 10 or 15 years. Comparatively.

Paul Harris: A lot of the anti miners are still very much stuck in an old mining mindset, a very reactionary and myopic mindset that's rolling out the same old arguments that haven't adapted and adjusted to the new reality of the mining sector. Okay, so that very much depends on where the mining company comes from. It's understood that mining companies perhaps from Australia or Canada, attend to things such as environmental aspects and community aspects in a much more responsible way than miners from somewhere else such as Russia or China, for example. Given that the presidents of both countries are looking at restarting their mining sectors, their gold mining sectors. Each country has a gold deposit Crucitas in Costa Rica, El Dorado in El Salvador. Presumably the government would be in a position to undertake a tender or bidding process to solicit interest from, you know, interested parties.

Paul Harris: Through that they can really establish the benchmarks of what kind of company they're looking for in terms of, you know, their financial wherewithal, their financial performance, their performance, how they've treated communities elsewhere that they operate, their environmental performance elsewhere they operate, etc. You know, essentially they can dictate the kind of company they want to come in and also the kind of company they would say thank you but no, they're in a quite a unique position from that respect. So they can really establish that we want you to come in. You got to use best available technologies to mitigate the various things that need to be mitigated. Plus what else are you going to do for us? And that could be what else are you going to do to help develop the regions or the communities?

Paul Harris: Or what else are you going to do to help protect water sources or even increase the availability of water sources? Water is a key issue in both countries. In El Salvador, the water system is. The main water source is the Lempa River, which is highly contaminated, is contaminated from legacy mining issues elsewhere in the country, but also from human use, human waste, agricultural runoff. Now miners in other parts of the world improve, for example, invest a lot of money to help communities and regions clean up their water sources in addition to what they do on their own projects. So the governments are in the position to say, look, if you come in, what are you going to do for us?

Richard McColl: So it's an opportunity to show and to let's say publicize some of Bukele the modernization of the mining industry rather than the older and unjustified. Older unjustified criticisms and fears. The Catholic Church, environmental leaders and so on. I mean a fear for me would be of course human rights from various sides and of course Central America never countries there never score well on the global sort of witness yearly report on sort of threats or deaths assassinations of human rights leaders or environmental leaders. And yes, the Lempa River is supremely polluted and of course it feeds San Salvador for its water too. So you're saying, and rightly so as you know that the mining companies could come in and beneficial to the environment.

Paul Harris: Absolutely. There's a good reference point here and that is the Freeport-McMoRan and it's Cerro Verde copper mine in Arequipa in Peru. As part of their social programs they invested a lot of money to put in water treatment plants for the. I believe it's called the Chili River which was again highly contaminated, highly polluted. The local authorities and government hadn't been able to put the investment in to keep that clean. The company took that on as part of its social responsibility programs and made a dramatic improvement there.

Richard McColl: Okay, so we can address those things. And of course El Salvador has a massive debt and so we're looking at that. But again it's, you know, it's not as if Bukele really needs to seek the approval of Congress. I think we know that's a foregone conclusion there but it would be in his to his advantage to actually explain some of the economic benefits for the citizens of El Salvador. Actual have a plan rather than great sound bites from Would we say we don't know where his report came from. We don't know where he got his figures Exactly.

Paul Harris: The government could strong arm measures through laws are just a pieces of paper at the end of the day. But you have to convince the population the government has to do that. If a company comes in, they have to do that. A buzz phrase in the mining sector for many years has been social licence to operate. Now your social licence isn't a piece of paper. It's not a permit that you apply for and you get. It's part of an ongoing engagement process with your local communities to inform and educate them about what you do in a transparent way manner, an open manner and getting them on board. Now depending where you are that can involved consent processes or it may not.

Paul Harris: But companies stress their efforts to obtain this social licence to operate again keeping communities informed and up to date in a transparent way and also undertaking projects that help benefit the communities as well the end of the day. So there's no surprises. Everybody knows what is going to happen and hopefully presumably all go along that journey together.

Richard McColl: I mean I see obviously we see Costa Rica, El Salvador, all in the same and the same boat but they're very different of course on that in their political spectrum. And I'm just sort of curious about your thoughts on President Chaves. He submitted this bill to the national assembly in November of last year to revise reverse the ban. How do you see this progressing?

Paul Harris: Well before I answer that, let me just add tack one thing onto my previous comment. When you don't have social licence to operate, things break down. We saw that very clearly in 2023 in Panama. Yes, the government negotiated a contract with First Quantum Minerals. Both parties there did that in good faith but the government didn't really include any mechanisms with local communities, with the local population to you know, socialize the agreement and what it that ended up in protest and ultimately the mine was shut down at great economic loss to the country and with the loss of I don't know was it 40000 direct and indirect jobs to the population now sorry Richard, what was your question again?

Richard McColl: It's all right. I was talking about. But we can continue on that in Panama and then come back. It's that was the copper mine up there and it was the massive social process. I was actually in Panama during this, not there for the protest myself. Ports and the country was brought to an absolute standstill. Of course it was very violent with something you know, we haven't attributed to Panama since I suppose Noriega years. It really was and I remember speaking to Panamanian friends, those who work in the tourism and industry and so on. It's like well the real question is do we want to be a mining country? But can we? It's one mine doesn't make you a mining country. But yes, there was a loss.

Richard McColl: But again the arguments against it was it the Chagres, I can't remember the two rivers that feed into the canal. And of course the canal at this point was at the lowest it's ever been in terms of water. And so there's a huge fear surrounding that. I mean there's a knock on effects because it was believed and I mean I'm no expert on this at all. You are. It was believed that the water to be used to the copper mine could additionally affect the Panama Canal.

Paul Harris: Well, that specific aspect, Richard, was complete, you know, smoke and mirrors or BS or whatever, however you want to phrase that, because the mines in a completely different watershed. It's not just in the next watershed. I think there's, you know, two or three or even more watersheds between the mine and the Panama Canal. So, you know, no impact one on the other at all.

Richard McColl: Okay, well, thank you for that. But it's an interesting one because of course, Costa Ricans will be looking at Panama and so on. So I was just. My previous comment was really about President Chaves in Costa Rica submitting the bill to the unicameral national assembly to reverse the ban. How do we feel that might pan out?

LatinNews promotional break: This podcast is brought to you by LatinNews, the leading source of political and economic news and analysis on Latin America and the Caribbean since 1967. Access LatinNews full portfolio of [email protected].

Paul Harris: I would be less optimistic on that than the change that's happening in El Salvador because, you know, President Chaves doesn't have the same level of support or majority of support or however you want to describ that his part in El Salvador does. So that could very much open into a more sort of popular debate because, you know, the politicians participating in that, you know, they'll have pretensions to be reelected. And so the voices of their constituents will probably ring louder in their ears. As we've talked about, you know, there's tourism in Elsa, in. Sorry, in Costa Rica is one of the main economic activities. It's something people are very keen to protect and extend. But this is perhaps something that doesn't get talked about a lot. Tourism has its own environmental footprint, which can be considerable.

Paul Harris: So for Costa Rica, all those cruise ships spewing out fumes, all those airplanes coming in, spewing out emissions, The emissions, the erosion of environment because of the growing number of tourists in other parts of the world, tourism is causing other problems in terms of cost of living. We're seeing this in big tourist centers in Europe. The increasing number of airbnbs and things like that make it increasingly difficult for local populations to afford housing. There's also water usage. So, you know, tourism isn't necessarily a panacea in and of itself and perhaps needs to be viewed within a broader context of what do we want our economy to be.

Richard McColl: This is true. And of course, yes, the debate over tourism and I can understand the, yes, I can understand the pushback on that in a country like Costa Rica, the gentrification that takes place and of course the increase in prices, pushing out, displacing the traditional communities from areas. But one would hope that they've got a better setup because they've been so, you know, involved in this for so long.

Paul Harris: There are other considerations as well. The tourism sector does employ a lot of people, but are they quality jobs? A lot of those, you know, I would argue are not quality jobs. They're not particularly high paying and they're, you know, service jobs. There's also a big argument to be made. You know, okay, you've got your environment, you want environmental tourism, great. How do you protect that environment? I would imagine a lot of the people involved in the tourist industry don't necessarily contribute anything, financially or otherwise to the protection of those environments. And this is one thing that big resource projects can do. For example, in Panama, First Quantum was, you know, because they're able to, let's say, put a fence around a piece of land, they're able to keep outsiders out and protect, you know, big parts of the jungle.

Paul Harris: Since the mining operations have stopped, the mine site or parts of the mine side have been inundated with illegal gold miners. Illegal gold mining is an issue in Costa Rica as well in some of the national parks. So you have the question, okay, you can put a fence around thing and declare a national park, but how, where are the resources going to come from to protect that? And this is, you know, one of the questions that governments or communities don't often ask themselves. This would apply to El Salvador as well.

Richard McColl: And I think one of the interesting comments that I've read, you know, in preparation to this is of course when we think about Mexico, you know, obviously North America, Mexico, but a knock on effect of, let's say, debate in Costa Rica and indeed then most likely I think we can suggest the pursuit of open-pit mining being successful in El Salvador. Knock on effect to Mexico is it puts pressure on that country to reconsider its restrictive policies as well towards mining. But you do have an environmentalist as president there. Perhaps. How do you feel regarding Mexico?

Paul Harris: You know, I'm perhaps a glass half full person. I believe, you know, everything is possible. So you know, I think it is possible to have a mining sector that does respect communities, that does make, you know, real positive contributions that does, you know, protect the environment. One increasing thing that you're seeing in mining projects around the world is the concept of compensation. You know, I'm going to dig a hole here which means I'm going to impact the environment here. I'm going to chop down some trees. You know, sorry about that. But as a compensation in another part of the country or the region, I can help improve the environment. I can plant new forests, I can protect forests or what have you, help with biodiversity, create environmental corridors.

Paul Harris: I can provide the funding and the technical knowledge and the plants and what have you to do that. So allow me to impact this, you know, this 10 hectares here, this 15 hectares here and I can help improve the, you know, a much bigger piece of environment elsewhere.

Richard McColl: And I'm curious again. So I think in El Salvador though, the issue is that there will be no mercury used to seek out gold. Is this right?

Paul Harris: Absolutely. Modern gold miners do not use mercury. It's only illegal gold miners, informal gold miners that use mercury. Modern gold mining typically uses cyanidation to extract the gold. And cyanide is, yes, it's potentially damaging and harmful compound but it's one that naturally neutralizes through exposure to oxygen. And modern gold mines have cyanide destruction circuits which basically involves putting in lots of oxygen to help accelerate the breakdown of the harmful elements of cyanide compounds so that it doesn't create harmful things.

Paul Harris: One of the best projects I've seen related to this in my 25-year career as a mining journalist was in the high out the high Andes of Peru where a gold mine, its cyanide destruction circuit went into a series of pools and in the last pool they had a fish farm as a way both of creating protein for the local population but also of visually showing them that the cyanide production, the process is, results in a, you know, neutral clean water.

Richard McColl: Did you eat the fish?

Paul Harris: I did not.

Richard McColl: That was a clear one. I'll move on a little bit here. There's very interesting what is going on in Central America. Of course it is very interesting and we would suggest that El Salvador will move ahead because of again the authority there. I wouldn't be so sure. On Costa Rica and it looks like President Mulino in Panama will be revisiting the issue of the copper mine as well. Whether he does it above board or so on or just tries to slide it through somewhere, we'll see. Of course one of the big, the big elements here, and it's central South America and other parts of the world is hopefully some of the money does trickle down. I mean, we've seen too many opportunities for money to go astray in these projects. But I think because we're both based in Colombia here.

Richard McColl: Let's talk just very quickly about this. You're in Medellín, I'm in Bogotá. We have Colombia's first ever leftist president in power. And it's been a continual debate about the new mining code. Is this ever going to be actually presented to the public? Have you seen a draft?

Paul Harris: I've seen drafts, Richard. I think that the general view is it's perhaps unlikely that President Petro doesn't have widespread support in Congress. You know, increasingly doesn't have widespread popular support. The vast majority of his legislative initiatives have drawn blanks or running to wars. And, you know, I think mining reforms to the mining code is going to be another one of those. You know, the mining code of Colombia's mining code law 685 of 2001 isn't perfect, but it, you know, it's generally seen to be a very good, you know, working, workable document. Yes, it needs some changes, some enhancements. But to go the whole hog and draft a new mining code is seen by many as overkill.

Richard McColl: Yeah. And, but I mean, what I understand from it's all about community participation and opinion on these things and then to try and involve the artisanal miners and legitimize it. And so I see a knock on effect again, going back, this kind of policy, going back into Central America, as we say, you know, the whole community involvement and therefore they get to have an opinion on these things. This is a positive thing.

Paul Harris: Yes. And I think most mining companies in this day and age actively seek to, you know, outreach to communities to get their opinion, to have them to a greater or less extent, participate in planning processes. This is becoming more and more common whether it's legislated or not, because, you know, at the end of the day it's just good business practice. Companies want the community approval or them to be aligned. And so as part of that they outreach and talk about what they're doing and try to get them on board again, whether that's regulated or not. So this is part of the, an ongoing wave. I think there are issues though, because there is some sort of conflation between, you know, let's say professional modern large scale mining and small scale mining.

Paul Harris: It's, it's not always compatible because the deposits don't always lend themselves to sort of doing both things. And also in Latin America, in Colombia, particularly unfortunately, small scale mining, artisanal mining is increasingly involved in or intertwined with illegal criminal groups which brings its own set of problems there.

Richard McColl: Aren't the illegal criminal groups permeating potential mines in Central America?

Paul Harris: Well, I think that remains to be seen. You know the people, the miners that have invaded copy Panama's concessions, they're perhaps you know, on their own without any specific support or backing from criminal groups. In El Salvador there is quite a, an established criminal level to the economy if you like and criminal gangs there. So if that takes off there, I imagine they're going to be very quick to get involved in that.

Richard McColl: Well, yeah, I mean they've imprisoned 1% of the population I'm sure. And then, and as we wind this down Paul, Honduras we look that I think the incumbent, I think we've got elections coming up. Xiomara Castro this year. I would expect that she's put in a pretty rigorous system to crush any opposition. So they don like reversing any of their policies on mining, do they?

Paul Harris: Well there is a bit of mining in Honduras and base metals mining but you know, I, I agree with you. Similar in Guatemala. You know, Guatemala has developed mines but the anti mining segment in Guatemala has been very successful, serially successful in getting mine shut down. Huh.

Richard McColl: Very interesting indeed. And again a year to watch then what's going on in Costa Rica and definitely in El Salvador and its knock on effect within the region. Thank you for the commentary on Colombia too because I do think all of these things are relevant. Definitely. Because there's an eye on every country in the region when it comes to this. And as you would expect the geopolitical situation and of course you know, the threats of tariffs, the threats of trade issues from North America, the expansion of China into the region, it's, it's definitely something to watch.

Paul Harris: Definitely. And you know, unfortunately in this part of the world, Richard, and you know this extends to Africa as well with high metals prices, high gold prices, high copper prices. You're in a situation where you know, mining may happen whether you like it or not, whether it's legal or illegal. So the question for governments and communities is who do you want to do that mine? Do you want it to be a formal company that's going to create benefits and wealth for the region and the country or do you want it to be illegal armed groups that are going to use it for their own nefarious needs and means or companies.

Richard McColl: From yes, Autocratic governments with no respect for human rights or the modernization of it. Well, thank you very much to you, Paul Harris, for sharing your thoughts here on the LatinNews podcast. It's been I've learned a lot, definitely. And I will be keeping an eye on these things, of course. Check out keep an eye out for Paul's writing. He's the Americas editor for the Mining Journal and the senior editor for Kitco. He also organizes the Colombia Gold Symposium will be taking place in the beginning of November 2025. So keep an eye out on that as well. Very good for networking as I've read all over the Internet. Very good for networking for mining companies and people in the industry. So again, thank you so much for your time.

Richard McColl: This has been Latin the LatinNews Podcast and we've been talking to Paul Harris. I've been your host, Richard McColl here in Bogotá. Bye.

Outro: You've been listening to the LatinNews Podcast. For more news and analysis on Latin America and the Caribbean, visit www.Latinnews.com.

William M. LeoGrande is a Professor of Government at American University’s School of Public Affairs, specializing in Latin American politics and U.S. foreign policy toward the region. With a career spanning decades, he is a renowned expert on U.S.-Cuba relations, authoring numerous books and articles on the subject.

His work has informed policymakers and the public on the complexities of bilateral ties, including during the historic rapprochement between the two nations in 2014. LeoGrande’s insights draw from extensive research and experience, making him a leading authority on the challenges and opportunities in U.S.-Latin America relations.

Introduction: Welcome to The LatinNews Podcast, a fortnightly deep dive into key developments from across Latin America and the Caribbean. Here's your host from Bogotá, Colombia, journalist Richard McColl.

Richard McColl: This is The LatinNews Podcast. I am your host, Richard McColl, here in Bogotá, Colombia. This week's very special guest is William LeoGrande. He's the professor of government and a specialist in Latin American politics and US foreign policy towards Latin America, and also the author of Back Channel to Cuba: The Hidden History of Negotiations between Washington and Havana. So welcome on The LatinNews Podcast.

Professor William LeoGrande: My pleasure to be with you today.

Richard McColl: Well, it's an absolute pleasure for us. And no guesses to anyone out there what we're going to be discussing today. Well, it's Cuba that is up on our list of important topics. And of course, well, thinking about early January 2025, President Trump taking the presidential office and, well, of course, Cuba. How does Cuba fit in to all of this? And of course, Marco Rubio as well, child of Cuban immigrants. Well, will we I can guess we can expect more hawkish attitudes towards Cuba.

Professor William LeoGrande: Well, there's no doubt about that. Senator Rubio was the main Republican critic of President Obama 10 years ago when Obama announced that he intended to normalize relations with Cuba. In fact, Rubio almost built his presidential campaign around that attack on Obamand when President Trump came in the first time, Rubio bragged that he and Representative Mario Díaz-Balart, another Republican of Cuban-American origin, had written Trump's Cuba policy for him. And of course, that was a policy of maximum pressure to try to really squeeze the Cuban economy. So I expect that we'll be moving back towards that kind of a policy.

Richard McColl: How much more can the US squeeze Cuba? Is there anything left to squeeze? We're looking at, you know, issues of a lack of drinking water there, power outages, energy crisis, you know, the contraction of the economy. What possibly more can the US do?

Professor William LeoGrande: Well, unfortunately, there's actually quite a lot more they could do. So President Biden relaxed a few of Trump's sanctions. He made it a little easier for people in the United States to travel to Cuba. He took all the restrictions off remittances that people can send to, particularly family members in Cuba, and he provided some assistance to small businesses on the island. Well, all of those things could be reversed by the Trump administration. And the issue of remittances is particularly important because that was before COVID one of the main sources of hard currency or foreign currency earnings for Cuba. It's gone down since then, but it's still a really important supplement for the standard of living of the Cubans who are getting help from their families in the United States. It would be possible for the Trump administration to simply cut off remittances entirely. Now Cuban-Americans would find some way to get remittances to their family members, but the amounts would be drastically reduced and that would make life even harder for the ordinary Cuban in the street. The other thing that they could do is they could create what are called secondary sanctions where the United States imposes sanctions on foreign companies or foreign individuals for having business with Cuba, even though the United States is not a party to that transaction at all. It is possible to do that. And for example, take Spanish hotels that are Spanish hotel companies that run hotels in Cuba. The United States could conceivably impose secondary sanctions on those companies, barring them from access to the US financial system or to US markets. That would create an enormous deterrent for any foreign company to do any kind of business with Cuba.

Richard McColl: Considering these secondary sanctions and considering everything else that's likely to happen to Cuba and we can, I guess we can suppose that the Trump administration is going to be stronger, more on Cuba. How much can Cuba rely on becoming or its inclusion as a partner in the BRICS?

Professor William LeoGrande: Well, you know, it's helpful of course, for Cuba to be able to diversify its international economic relations. It's got fairly good relations with a number of those countries already. I don't think that that's going to be a panacea for them though. It's none of those countries are going to be able to provide the kind of external resources first of all to cushion additional U.S. sanctions or to really provide the Cuban economy with the external capital flows that it needs to really begin the process of recovery.

Richard McColl: So if we look at your book was written, the book was written 10 years ago almost, you know, almost to the month. This the history of negotiations between Washington and Havana, the back channel to Cuba. It's the 10 year anniversary of Obama kind of lifting or trying to working towards a normalization. Would you ever have predicted what is going on now as 10 years ago?

Professor William LeoGrande: No. 10 Years ago Cuba was very hopeful. I happened to be in Havana when President Castro and President Obama made the announcement that they intended to normalize relations. And people were jubilant. People were demonstrating in the streets, church bells were ringing. Everyone was talking about it because for Cubans it was as if a war had ended. And in a sense it had. The United States had been waging economic war against Cuba for half a century. And for most Cubans, it meant hope for the future, that the economy would really start to grow, the embargo would be lifted. And so it was a. It was a joyous moment, really. And that enthusiasm lasted for the next two years as the two countries began to draw closer to. And. And then we had Donald Trump, which really dashed those hopes when he repudiated normalization and reimposed a lot of the sanctions and more sanctions than Obama had on Cuba. So things have really gone downhill from there. The surprising thing was President Biden not returning to Obama's policy of engagement. After all, he was Obama's vice president during the campaign of 2020. He pledged that he would return to Obama's policy for the most part. And then he came to office and he didn't, as I said earlier, he lifted a few sanctions, but he left the large part of Trump's sanctions in place at a time when Cuba was really struggling under COVID. The tourism industry is the centerpiece of the Cuban domestic economy, and of course, COVID closed it down entirely for two, almost two and a half years. So Cuba was really struggling, and the sanctions that Trump had put on were crippling the economy, and Biden did almost nothing to alleviate them.

Richard McColl: What can we attribute this to? Was it just easier to continue along this line, or was he very aware of the opposition voices in Florida? What was it, heavy lobbying in Washington?

Professor William LeoGrande: I think it was some of each. On the one hand, of course, Cuba was not a high priority, given all the other things that President Biden had to deal with coming to office. So they did nothing at all, really, for the first six months or so. Then you had surprising demonstrations in Cuba in July 2021, really, nationwide demonstrations, the first time that had happened since 1959. And the police reacted very harshly. Hundreds of people were arrested, hundreds were sentenced to prison, relatively long prison terms. And so the Biden administration reacted against that, understandably on human rights grounds. And then it became, I think, politically harder for them to do anything positive in the wake of those demonstrations. Also, President Biden formulated his foreign policy right from the beginning around this idea of the confrontation globally between democracy and authoritarianism. And of course, the authoritarians, he was focused on Russia and China, two of Cuba's closest allies. And Cuba, after all, is not a democracy. So I think Cuba got slotted into the authoritarian adversary box by this overall Cold War framework that Biden adopted. But the domestic political issues were important as well. Biden's first chief of staff, Ron Klain, was in charge of Al Gore's recount in 2000 when Al Gore lost Florida and the presidency by just 537 votes because Bill Clinton sent 6 year old Elián González back to his father in Cuba, enraging the Cuban-American community. So Obama, I saw, excuse me, Gore got very few Cuban-American votes in 2000 and that's why he lost the election. So Ron Klain has never gotten over that and he admits that he's never gotten over that. And for him, Florida is still the third rail of American politics. And then of course you had Senator Bob Menendez, who is a friend of President Biden. And Biden's own decision making style on tough issues was to check in with his Senate colleagues, his former Senate colleagues who were specialists on the issue. And so on Cuba, that was Bob Menendez. And Menendez was absolutely opposed to any kind of opening to Cuba. So I think he put all those things together and the result is a president who just wasn't willing to do anything more than just the minimal that he had to do to resist pressures from Latin America to go back to Obama's policy.

Richard McColl: You mentioned the jubilation and the people celebrating in the streets as if a war was over. And now we have Miguel. Well, the President Miguel Díaz-Canel saying that Cuba is on wartime economy. What does this mean?

Professor William LeoGrande: It means austerity, essentially. The government is cutting back on, well, everything because they just don't have the resources. They are short of food because they import 80% of their food and they just don't have the resources to pay for the food they need. Same with medicine, same with fuel. And now they're suffering periodic blackouts of electricity because they don't have the fuel or the spare parts to keep their thermoelectric plants running.

Richard McColl: Before we move on to that and the energy, could we also suggest that this wartime economy could also justify greater repression and total control?

Professor William LeoGrande: Well, there's no question the government has become much less tolerant of any effort to organize opposition. Right after the demonstrations in July of 2021, which took the government by surprise, it began to really crack down on any kind of organized opposition. And the result is that a lot of leaders of organized opposition groups have just gone into exile because the government makes it much easier for them to go into exile than to continue to be dissidents. And the few that have refused to leave are in jail. So the result is that there's very little organized opposition left. But you still see these spontaneous outbursts of protest when the lights have been out for two or three days in a particular community, or there's no water in a community for days at a time.

Richard McColl: And that's what we're seeing, that's being reported in the press very frequently right now. And it seems a pretty desperate situation when you have an economy, a country entirely reliant, with 95% reliant on fossil fuels, accounting for the island's energy or electricity generation, and upwards from 48% of this being imported fossil fuels. It seems like Cuba relies on the imports it can't afford and on trading partners that are supplying a diminishing amount. There doesn't seem to be any solution forthcoming.

Professor William LeoGrande: No, there's no easy short-term solution for them. You know, most countries in this situation could appeal to the International Monetary Fund or the World Bank for bridge funding to get them out of the immediate crisis and begin to sort of rebuild the economy. But the, but the Cubans are not members of the IMF or the World Bank and the United States would oppose their membership even if they were interested. So that's just not a solution for them. The result is that they've looked to foreign allies like Russia, China, Venezuela for support just to basically keep the lights on and import the food that they need. It's, it's a very desperate situation. There are some economic reforms that they've made and additional ones they could make that would help them in the medium to long-term. But in the short-term they're just in an extremely difficult situation and there's really not much prospect that things will get better in the immediate future.

Richard McColl: This is all incredibly negative for the island. And what remains of the achievements of the revolution, let's say health, education and social equality, if anything.

Professor William LeoGrande: So all of those achievements, which sort of the crown jewels of the revolution have all taken a hit as a result of this. It's still the case that the government is trying to provide a basic diet for everyone. It's, it's a thinner diet than it was 10 years ago, but there is still a basic diet of highly subsidized food that people are able to buy. There is still free health care, although there aren't very many medicines available. There is still free universal education, although a lot of teachers leaving the country. So you can see a pretty clear deterioration in a lot of the things that Cuba was most proud of. There's also rising inequality and that's because the people who have. Well, there's really a couple of groups, subgroups, if you will, of people in Cuba who do have money. One is people who get remittances from abroad because the value of foreign currency is very high right now. Another is people who work in the private sector. The Cuban private sector has been growing recently and people who are working in the private sector are either paid higher wages or paid some of their wages in foreign currency. And so they're doing okay. And then there are people who are able to work abroad, artists, musicians, to some extent writers, who are able to sell or publish their work abroad and make money from that. And so they have an income, at least part of an income in hard currency.

LatinNews promotional break: This podcast is brought to you by LatinNews, the leading source of political and economic news and analysis on Latin America and the Caribbean since 1967. Access LatinNews full portfolio of reports at www.latinnews.com.

Professor William LeoGrande: Those groups of people are doing okay, but they're a minority of the population overall.

Richard McColl: You mentioned teachers and others going into exile. I have a statistic here that since 2022, upwards of 850,000 Cubans have arrived in the U.S. this number is only going to increase, I suppose, despite all of the work that the incoming administration promises to do about shutting the borders and so on. This is a huge amount of people and somewhere around, I guess, 10% of the population have left.

Professor William LeoGrande: Yeah, that's right. Probably closer to a million have come to the United States if you count the people who've come legally as well as those who have just showed up on the southern border of the United States. And there are several hundred thousand more that have been going to other countries in Latin America or many of them going to Spain. And it's been a disproportionately young and highly educated group that's been going. And so that's a particular drain on the Cuban economy. It makes it even harder for the economy to really get started once again. The growth of the private sector is the one area where there has been some hope. A lot of the entrepreneurs who have opened new businesses tend to be younger people, tend to be well educated people. And they're sticking it out because they think that, you know, there's a future for them in the country. One of the real tragedies potentially of intensified US sanctions is that it will drive those people out of business and then you'll see many of them leaving as well.

Richard McColl: So sanctions, I mean, we can point at Them as, of course, affecting the population, affecting the general Cuban. But possibly if we look away from the sanctions and say one of the fundamental causes is that just for the failure of the island is that Cuba does not generate enough exports to pay for its imports at all. Sanctions are one thing, but we're not going to see the regime fall unless there's change within the structure. It's not going to come externally. But what do you think on this?

Professor William LeoGrande: Well, there's no question that the Cuban economy right now is in a deep depression. Production last year pretty much across the board fell drastically. And part of the reason for that is because they don't have the money to import the inputs that they need for domestic production. And as domestic production falls, exports fall, so they're earning even less hard currency, so they even have even less import capacity. And they're in it a kind of a vicious downward circle. Right now. The Cuban economy is also sort of in the middle of a reform process that Raúl Castro started in 2011. His goal was to emulate a kind of Vietnamese model of market socialism. Cuba had inherited a system of central planning from the Soviet Union that had a lot of the same problems that the old Vietnamese system had. And they looked to Vietnam as a model of where to get to. The problem is, of course, Vietnam is a very different country, and while they had a lot of this, Cuba has a lot of the same problems Vietnam had. They don't have the same path out of those problems. Right. Vietnam was 80 or 90% rural. They had cheap rural labor that they could rely on. They had oil, and they finally reached reconciliation with the United States.

Richard McColl: I mean, Cuba was looking to model themselves on a Vietnamese. The Vietnamese way of you said of. Of market socialism. But it's not at all. I mean, they're two very different places. Two very different places. Again, it just. It isn't working.

Professor William LeoGrande: It's not that they've tried the same policies as Vietnam. As I say, they wanted to get to the same place of a kind of a combination of socialism, but with a lot of market mechanisms, private enterprise and so on. And this process of reform went very slowly because there were vested interest in the bureaucracy, the government and the party bureaucracy that resisted it. Then they got hit with COVID right. Which put everything on just an emergency survival basis. And now we've got u. S. Sanctions intensified once again. So they sort of got stuck in the middle of this process. In 2021, they put in place a currency reform which was designed to try to get prices and exchange rates. Right. And it was badly done and the result was to unleash severe inflation. And so people, since 2021, the purchasing power, the real purchasing power of the Cuban peso has fallen by 90%. So they've just gotten into a really desperate situation. And as I say, there's, there's no easy exit from it at this point.

Richard McColl: And of course it looks as if it will only worsen in the coming months. It seems to me that when we discussed in the last episode with Ambassador Shannon, U.S. foreign policy towards Latin America is really the great Caribbean region. So all of northern South America and the Caribbean and Central America, of course, Cuba playing a huge role in this. And with my, as we said, my mentioned previously, Marco Rubio. So we feel that Cuba and Mexico and then latterly Venezuela will be the top items for Latin America in Washington. With this in mind, in a perfect world, do you believe that there areas for cooperation between the US government and Cuba, for example, I mean for the obvious one migration and next the second one for me would be drug trafficking?

Professor William LeoGrande: Well, in most of the areas where cooperation has been the best for the last 25 years, you know, Bill Clinton's administration really forged a good relationship with Cuba in the field of counter narcotics. And Cuba is actually the most reliable partner we have in the Caribbean when it comes to countering narcotics trafficking and migration. We've had again migration agreements to. Clinton administration signed two migration agreements with Cuband although the first Trump administration failed to carry those agreements out, they've worked pretty well when presidents have abided by them. We'll see now if the Trump administration, the new Trump administration, actually abides by those agreements or if it abrogates them the way it did last time.

Richard McColl: Definitely an issue that I see raising its head. And as you say, this spiral very difficult to get out. If Cuba again were to turn the page, what would have to happen between the relationship with the US in order to pull Cuba from this chasm it is in.

Professor William LeoGrande: It seems pretty clear that the Trump administration is going to once again have a policy based on the objective of regime change, that is to say, to collapse the Cuban government. Now that as a matter of fact would be a disaster for the interests of the United States. You know, a regime collapse in Cuba is not going to look like, you know, Czechoslovakia in 1989 where, you know, you have a peaceful people's power transition because there isn't any organized opposition in Cuba capable of stepping in and taking over. And you've got a military and security forces that are at the center of the regime. And there's no indication of any division between the political leadership and the security forces that would generate a sudden regime transition. So if things were to simply break down in Cuba, you're more likely to get social chaos and violence, which then opens the door to migration, to, you know, intervention by Cuban-Americans on their own in an ongoing conflict there opens the door to transnational crime to be able to set up a depot for narcotics trafficking and human trafficking into the United States. You know, when the Soviet Union collapsed and Cuba was in a similar difficult economic situation, the analysis inside the United States government would be that the United States should try to avoid regime collapse because of the chaos that it would cause and the threat that it would pose to US interests. But that's not how Cuban-American Republicans in South Florida think. They want to see the regime collapse and with some of them hoping they're going to go back and take over the island. We'll have to see. But, you know, arguably increased sanctions by the Trump administration are going to aggravate the two problems that he seems to be most concerned about out of Latin America, which is migration and narcotics trafficking.

Richard McColl: And as you say, those in southern Florida, the attitude is regime change, regime collapse at any cost.

Professor William LeoGrande: Yes. And they've been trying to do it for 60 years now. And the fact that it hasn't worked, hasn't deterred them.

Richard McColl: And I mean, God. So you get the, get the impression then that it would be another Caribbean island? Probably not. Hopefully it wouldn't go as far off, you know, of kilter, like Haiti, for example. But what you're describing is not dissimilar.

Professor William LeoGrande: You can see that as a sort of the worst case outcome here already. Basic social services have been deteriorating for lack of resources. Now, it's not a failed state in the sense that Haiti is a failed state where there is no central government that has any real authority or control over the island. The Cuban government has control over the island. It just doesn't have the resources to deliver the basic services that people expect from government.

Richard McColl: Sure. So we're left with President Miguel Díaz-Canel making his declarations from the pulpit. He's sort of like, despite everything, there remains the homeland, the revolution and socialism, which guarantees protection for all.

Professor William LeoGrande: Well, he's, I think, making the best of a bad situation by trying to inspire people, exhort people to just hang in there and sort of Keep working hard and keep fighting. But you know, he needs to, I think personally he needs to do a better job of conveying to Cubans what his government strategy is for getting out of this mess. Because they haven't really done that. Periodically they announce, you know, new policy here, new policy there, but it seems very ad hoc, very piecemeal, very reactive. There isn't a sense of, here's this, we recognize the problem, here's the strategy to get out of it, and here's what we're going to do tomorrow, the day after and the day after that. That would at least give people some sense of hope of a solution to these problems where right now I don't think people have that.

Richard McColl: No solution and possibly we would say no coherent long-term strategy at all. As you say, reactive to the energy failures, the blackouts, the lack of drinking water, that so many people are suffering from it doesn't seem like there's very much that we can point to that is good news for Cuba in the coming years and in particular under the incoming administration. If we're sitting here in a few years time talking once again, hopefully we can be talking about a, you know, a positive change for the island. But I fear it's going to get a lot worse before anything gets better.

Professor William LeoGrande: There really doesn't appear to be any viable solution for them in the short-term. They just, they need external assistance, they need bridge funding from someplace. Can they patch that together between their new friends in the BRICS? Venezuela. The Venezuelan government seems to be solidly in place despite having lost the last election. And then Russia and China, you know, as tensions rise between the United States and China in particular, it's possible that China will respond by increasing its support for Cuba. Heretofore, the Chinese have been reluctant to do that because they're waiting for the Cuban economic reform program to really take hold. China tends to not be operating abroad as a charity, but rather looking for return on investment. And so far there hasn't been a lot in the Cuban case. But you know, for Russia, historically, assistance to Cuba was not about the economics, it was about the geopolitics.

Richard McColl: Yes.

Professor William LeoGrande: And as relations between the United States and China deteriorate, that could begin to be a consideration for the Chinese as.

Richard McColl: Well, which would, despite being a negative to the US would be a definite step up for Cuba. Of course, just the way these things play out.

Professor William LeoGrande: Any reason, any external resources the Cubans can get at this point are positive because they need every dollar or every one or every euro that they can find.

Richard McColl: Well, listen, I think that's a place where we can end this conversation which has been really quite special and very informative about the troubles on the island of Cubagain, it's all pretty negative right now, but let me take this moment to say thank you so much to William LeoGrande, the professor of government and specialist in Latin American politics and US foreign policy towards Latin America, author of Back Channel to Cuba: The Hidden History of Negotiations Between Washington and Havana. William, thank you so much for your time.

Professor William LeoGrande: My pleasure.

Richard McColl: This has been The LatinNews Podcast. I've been Richard McColl, your host here in Bogotá, Colombia. Remember to subscribe and share to The LatinNews Podcast. We will be back in a fortnight's time with more episodes on issues from the region. Goodbye.

Outro: You've been listening to The LatinNews Podcast. For more news and analysis on Latin America and the Caribbean, visit www.latinnews.com.

Ambassador Tom Shannon

Tom Shannon is a seasoned American diplomat with over 35 years of experience in U.S. foreign policy. He has served in pivotal roles, including Undersecretary of State for Political Affairs, U.S. Ambassador to Brazil, and Assistant Secretary of State for Western Hemisphere Affairs. Shannon has worked under six presidents, both Republican and Democrat, shaping U.S. policy on Latin America and beyond.

Renowned for his strategic insights, he has been a key player in addressing global challenges such as migration, trade, and regional security.

Intro: Welcome to The LatinNews Podcast, a fortnightly deep dive into key developments from across Latin America and the Caribbean. Here's your host from Bogotá, Colombia, journalist Richard McColl.

Richard McColl: This is The LatinNews Podcast. I am your host Richard McColl here in Bogotá, Colombia. And we have an incredibly special guest this week on the show. For many, he'll need no introduction, but it's, I better say Ambassador Tom Shannon, the former assistant secretary of State for the Western Hemisphere Affairs, previously under the Bush administration and the Obama administration, and then latterly ambassador to Brazil. So, Ambassador Tom Shannon, welcome on The LatinNews Podcast.

Tom Shannon: Thank you very much, Richard. Very happy to be here.

Richard McColl: It's an absolute honor to have you here on the podcast because, of course, given events in the United States recently, the election, the re-election of President Donald Trump due to take over in January 2025, I'm reading and I'm interpreting analysts making these statements, perhaps bold, perhaps foolhardy, but thinking perhaps that Latin America might take more of a center stage in President Trump's foreign policy protocols coming up. I'd love to start on this and what you think about that?

Tom Shannon: Well, I think that would be everyone's hope. Everyone's hope is that with the nomination of Senator Marco Rubio, someone to an American background, a Spanish speaker, someone who has served as chair of the Western Hemisphere Subcommittee within the Senate Foreign Relations Committee and who has a long tenure following events related to our own hemisphere and beyond, that this would bring a special attention and a special expertise to how the United States engages in our own hemisphere, but especially in the Caribbean, Mexico, Central America and South America.

Tom Shannon: But as we get our hopes up, it's important to remember that President Trump is going to be inheriting a complicated, difficult and contested world and will be picking up several major conflicts that we're all familiar with, Russia's invasion of Ukraine and the ongoing war in Ukraine and now in parts of Russia, including the decision just yesterday, as reported in the Washington Post by President Biden, to allow the Ukrainians, in response to the North Korean presence in Ukraine and Russia to use missiles for long range strikes into Russia, which potentially elevates the nature of the conflict and draws the United States more closely or more tightly into that conflict.

Tom Shannon: And then, of course, everything that's happening in the Middle East, the war in Gaza and now Israeli attacks against Hezbollah in Lebanon, the missile barrages, the reciprocal missile barrages between Iran and Israel, the potential for a larger Middle East war and then, of course, the concern that I think is front and center in President Trump's mind And the nominated Secretary of State, Senator Rubio's mind, which is China, and not only its presence in Southeast Asia and in the Indo Pacific region, but also its continuing push to build influence in Latin America, in Africa and in what we call the Global South. And so the Trump administration and Secretary Rubio, should he be confirmed, are going to find themselves with a lot to do in a very little time.

Tom Shannon: And so I think what we're going to be seeing is although there will be interest and there will be direction, a lot of the heavy lifting is going to be done by whomever the President and the Secretary choose to hold key positions within the administration, both at the National Security Council in regard to Western Hemisphere Affairs, but also the Assistant Secretary for Western Hemisphere Affairs. And we'll have to wait and see who those people are.

Richard McColl: And as we're waiting to see who these people may well be, do we expect these advisors, do we expect them to have a unified view of US policy towards Latin America or is it going to be sort of a, you know, a pull and shove?

Tom Shannon: No, I think they probably will. Listen. Every Republican administration that I've been associated with and across my 35-year career I served for six presidents, four Republican and two Democratic. And every Republican administration comes in and when and peoples the key positions with a bow towards South Florida, clear recognition of the importance of Florida on the electoral and within the Republican Party. And I think we can assume something similar. I think we can assume that we're going to have people in key positions who reflect a foreign affairs vision or view of South America, which is really about the greater Caribbean stretching across northern South America, especially Venezuela and Colombia, Central America, Mexico and then the Caribbean itself.

Richard McColl: And so we're saying that the greater Caribbean, obviously applying to Florida, as you said, Colombia, Venezuela and then of course Central America and the Caribbean Islands, I imagine Haiti, of course, we can't draw that out. Dominican Republic and beyond. But what about the Southern Cone then? And of course Brazil.

Tom Shannon: Listen, these are important countries, but they're in from the political viewpoint of these people, they're second-tier countries. There are countries that get drawn or you try to draw them into a larger political purpose, which is addressing the confusion and chaos in Cuba, in Haiti, in Venezuela, in Nicaragua, and then trying to secure broadly the larger Caribbean, both in terms of migration, in terms of drug trafficking, but increasingly in terms of Chinese presence.

Richard McColl: Well, the Chinese presence is something of great interest, especially right now as we're in the wake of the APEC meetings in Lima and of course the immense investment that has been taking place, not least to mention the Chancay port and this evolution of the Belt and Road Initiative. What can we see of, let's say, US influence in the region to try and counter this?

Tom Shannon: That's the big question. I think this is going to be a dominating question within the administration as they attempt to understand how to ensure that a region which had, over time built a special political relationship, economic relationship and cultural relationship with the United States does not see that diluted or ended because of Chinese presence. The irony here, of course, is that China's presence in the region is driven by the globalization, especially South America, and by the attraction for the Chinese and others of the extraordinary resources, agricultural, energy, you name it, minerals that have attracted China, among others, to the region.

Tom Shannon: But also the fact that we played a primary role in shaping free trade agreements that created open trading regimes, especially along the Pacific coast, that were ideally situated to engage with the emerging markets of Asia, in other words, to engage across the Pacific. So we played a central role in kind of laying the tableau, so to speak, for what we're seeing now. And the question is whether we're just going to step back and let the Chinese have their way or whether we're going to engage in a fashion in which we can't push China out. I mean, it's the second largest economy in the world and it's a huge purchase, as we talked about. And so the region is going to continue to want to stay engaged.

Tom Shannon: But the United States has huge advantages in terms of market access, in terms of technology, in terms of sharing similar understandings of transparency, accountability, anti-corruption, promotion of environmental stewardship and biodiversity that the Chinese don't share. This is where we need to focus.

Richard McColl: So we sort of talk about almost shared cultural beliefs and practices that obviously the Chinese are, you know, are foreign.

Tom Shannon: To and a common strategic purpose.

Richard McColl: Okay. I find, I find it very interesting this, on that level, it's not something I thought about. And as you talk about this kind of, this mutual meeting point for Latin America and the United States, I wonder how that fits, though, with, and forgive me for saying it, if President Elect Trump, if his prism of or his vision of Latin America is seen through a policy towards migration and drugs, how do we get on board with what you just said in that kind of manner?

Tom Shannon: Well, that would be Senator Rubio's challenge, trying to convince the president that as important as the migration and drugs and China agenda is that there is a larger agenda and to recognize that the United States has, in our Western hemisphere this remarkable Strategic reserve. While the United States faces really big security challenges elsewhere in the world, it has within its own hemisphere a region that's peaceful, that has enormous natural resources, has more arable the world, more fresh water than any part of the world is energy independent, can produce enough food to feed the world. This is largely democratic, largely committed to market economics and understands trade as the driver of growth. And you would think that given what we face elsewhere, that we would be doing all we could to protect this region and our relationship with it.

Richard McColl: Yes, of course, we look at Marco Rubio a bit. I mean, obviously a staunch anti leftist, obviously staunchly against the regime in Cuba. In two weeks time, we're going to be discussing Cuba in far greater detail. But I would be very interested. Of course, he'll be looking at it from a perspective of being from Florida, being of Cuban descent. What more can the US do regarding Cuba under Rubio? I mean, we're looking at obviously sanctions and so on, but the regime has been there for some time.

Tom Shannon: Yes. And it's not going anywhere because of us. When it does go, it's going to go because of the Cuban people. And what I think we need to keep in mind in dealing with Cuba, but also I think Venezuela is that we have shown clearly that external sanctions will not drive fundamental political change, that it has to come from inside. And that inside does not mean an external diaspora. It means working with the political forces internally, but it also means protecting neighbors from the chaos and confusion that will continue to bubble in these countries.

Tom Shannon: And so I would argue that in dealing with the challenges of Cuba and Venezuela and to a certain extent, Nicaragua, what we need to be doing is not so much focused on those countries themselves, but on all the countries around them and looking for ways to strengthen our relationships with them, to strengthen our security presence and to make clear that we have a common purpose and a common agenda and that the Cubans, Venezuelans and Nicaraguas are outliers and because they're outliers, they won't be successful. So I would argue that, you know, you address this problem by making it bigger and by making it more comprehensive.

Richard McColl: Very interesting that indeed. But Venezuela obviously is a, you know, we need to move on to that quite quickly. Of course, you, we get this idea that President Trump has a degree of respect maybe. Well, certainly for the strongman Nicolás Maduro. And of course, President Trump the last time around pegged his hopes to Juan Guaidó in overthrowing the regime and reinstalling the democratic process. But of course it was a failure. Do you think it will just be largely saber rattling, not wanting to get involved in Venezuela since he got his fingers burnt last time?

Tom Shannon: You know, that's a great question. And so much is going to depend on the Venezuelans themselves and how they choose to respond to this moment and whether or not they choose to challenge the United States in some fashion. You know, my own view is that President Trump knows that the maximum pressure campaign that his advisors put his administration on failed. It failed to remove the Maduro government. It actually consolidated that government's power and control of Venezuela, and maybe more damagingly, it provoked a massive migration from Venezuela that has had profound impacts in all the neighboring countries and now the United States in which has become part of President Trump's migration agenda. And so it would be ironic, if not foolhardy, to go ahead and do the same thing all over again, because what's going to change?

Tom Shannon: And so this is, I think, a moment in which what the president is going to try to do is what he did at the very beginning of the Trump administration, which is build a new kind of diplomatic structure. In those days, it was, you know, the Lima Accords and talks, which were all which fundamentally changed how countries throughout the region understood Venezuela and convinced people that diplomatic pressure had to be brought to bear, but more importantly, that there had to be protection for countries around Venezuela. And it's my hope that the Trump administration will go back to something similar, but then fortify it. And let me give you an example.

Tom Shannon: One way to send a clear message to the Venezuelan Armed forces and the government of Nicolás Maduro is to do a security alliance with Guyana in which the United States guarantees the territorial integrity of Guyana, including its maritime integrity. And that would let the Venezuelans know that because of their behavior, they have lost their national interest and assertion or claim to the Essequibo, that part of Guyana that has been in dispute over time, and that we will not permit the Venezuelans to threaten the Guyanese, and that we will allow Guyana to explore its oil and gas resources across the entirety of its maritime boundaries. That would be a powerful message and it would be one that the Venezuelans could not counter without inviting, you know, military conflict with the United States.

Tom Shannon: But having said that, it's, I, I really do think and hope that the region is going to turn, that the Trump administration is going to turn more to regional actors and make it clear to them that they have to address this problem and that if they don't over time, that we will, but probably in harsh ways.

Richard McColl: I'm sure that the government in Guyana would be very pleased to receive aid, let's say, in a military form there to protect the maritime borders and the Essequibo and so on. Of course, that would create, as we know, a furious war of words from the Nicolás Maduro regime. Is there any situation that you feel that President Trump feels that he has unfinished business there and there's a possibility of any military intervention into Venezuela?

Tom Shannon: Well, I would hope not. And it's important to understand something about President Trump, at least my experience with him and I worked for in 18 months in his first government. He does not want to be a war president. He wants to be a peace president, and he wants to be a president who is defined nationally within the United States as a prosperity president. And he had any number of opportunities to go to war when he was president, especially with Iran, and he avoided them all. And he's not adverse to using American force.

Tom Shannon: And he did it in several instances in attacks in Syria after the use of chemical weapons, in the killing of General Qasem Soleimani in Baghdad, the head of the Iranian Quds Force, whenever he thought that it was important to send a clear message to an adversary, you go no further without risking conflict. But this is not his purpose. And he recognizes that Venezuela has the largest reserves of oil and gas in the world, and that these are reserves that should not be just for the benefit of PDVSA or the Venezuelan government or for China or for Iran, should be available for exploitation by us and other companies from friendly countries. And so there's a conundrum here that has to be worked out.

Tom Shannon: But I do think that while there's no kind of immediate strategic need or interest to consider military action, if this confusion and migration continues over time, that might change.

Richard McColl: Well, we hope, of course, that there's no need for military intervention, especially given, let's say that given the history of the United States here moving on to Colombia, as we sort of go west across the continent, moving on to Colombia, obviously, we have here, Colombia, our first ever leftist president, Gustavo Petro. We know Marco Rubio's stance on Petro. He's made some statements in the past. Drug trafficking is up because, of course, coca cultivation is skyrocketed. We are a conduit for Venezuelan immigration, migrants, Haitian migrants, Cuban migrants, and of course, you know, to a lesser extent, migrants from elsewhere across the world. So we are. Colombia acquiesces to it and that permits them to go through, up into Panama. So we feel a little bit that Colombia might be on the map for the Trump administration.

Richard McColl: What do we feel might happen with, let's say, military aid or assistance to Colombia under a Trump administration?

Tom Shannon: It's a very good question. And it's important to understand that President Trump is not ideological. He might be rhetorical, but he's not ideological, and he's about doing deals. And there's no doubt that President Petro, when viewed through the lens of South Florida, is not seen as a bright shining object. However, Colombia is. The United States has had a truly remarkable and maybe even unique relationship with Colombia over time and has played a central role in just about everything that has happened in Colombia since the beginning of the century, since the election, even before the election of Álvaro Uribe.

Tom Shannon: And in this regard, it would be a shame for the United States to step away from Colombia because Colombia, you know, is a fascinating South American country that historically has not related well to any of its neighbors, but it has related well to the United States. And I think that should this relationship deteriorate or collapse, that Colombia would find itself feeling quite alone at an important moment. But having said that, there's no doubt that migration and drugs are going to be a big part of how President Trump understands Colombia. And the difficult fact that Colombians will have to explain is why more cocaine is being produced today than ever before. Now, obviously, a lot of it has to do with demand, a lot of it has to do with this endless fascination that Americans and Europeans have with cocaine.

Tom Shannon: But that explanation is not going to soothe anybody here when it comes to additional security assistance to Colombia. So I would expect that the issue of the Darién Gap, the issue of who moves through Colombia and who goes north, and the porous nature of the Colombian frontier with Venezuela and then the inability of the Colombian state to establish total control over its national territory and what that means in terms of drug production are all going to be significant issues in the relationship.

Richard McColl: I get the feeling, again, there's going to be a lot of rhetoric thrown around. I get the feeling, as you say, very interesting, the points on President Trump not being ideological, but certainly being someone who's, you know, it's about commerce. It's about, as you said, it's about affluence in its way. That kind of brings me, I was going to leave it till later, but another leftist in the region, President Lula, and of course, you were ambassador in Brazil for quite some time. Trump being good friends, if not best friends with Bolsonaro elections in 2026. We know that Lula is pragmatic, but how do we see that relationship?

Tom Shannon: Well, Lula's the most experienced politician in Latin America, and he's one who has probably dealt with the most American presidents across time and if not as president, as a significant political leader. And so I'm quite confident that the Brazilians will find a way forward, largely because Brazil has always been an interest driven country. And even when it pretends to be ideological, it isn't. It is about its fundamental commercial interests protecting its markets. And so I think there at least is ability to understand each other. And curiously enough, probably the best relationship that President Lula had with any American president was with George W. Bush, was with a Republican. And, you know, Bush was uniquely open to leaders like Lula because he understood their impact and their power at the time of his Lula's presidency.

Tom Shannon: And he knew that Brazil, you know, we needed Brazil as a partner on any number of issues. So it's my hope that there's, there will be a clear recognition in the incoming administration the second largest democracy and the second largest economy in the world, I mean, in the Western Hemisphere, you know, needs to be respected and needs to be engaged, which of course doesn't mean that there's political spillover. And you mentioned Bolsonaro. And there's no doubt that President Trump's reelection has energized if not electrified the right in Brazil and elsewhere in South America, because in Brazil's of a special interest, because Brazil and the United States right now mimic each other. What happens in the United States happens in Brazil. What happens in Brazil happens in the United States.

Tom Shannon: And it's because our democracies are similar and we're both struggling with larger issues, which is economic and social change, which has been transformative in nature, but also so profound and so fast that political parties, political institutions and political leaders haven't been able to keep up. So voters are looking for anybody who can understand what the hell just happened and how to make their countries safer and more prosperous in this environment. And I think the larger challenge that President Lula is facing right now and that his party is facing is that they are a left-of-centre party governing a right-of-centre country.

LatinNews: This podcast is brought to you by LatinNews, the leading source of political and economic news and analysis on Latin America and the Caribbean since 1967. Access LatinNews full portfolio of reports at www.latinnews.com.

Richard McColl: Is this electrifying the opposition or the right of course we're seeing it, we see it here in the mobilizations for the 2026 elections in Colombia. But kind of brings me quite nicely to President Milei in Argentina and his rapid victim visit to Mar-a-Lago after the Trump victory. Obviously the relationship is far more one sided and Milei looking for any advantage possible. You did mention earlier on which I find incredibly fascinating is, you know, the US policy or the US look towards Latin America is that of the greater Caribbean. We kind of, as you said, Milei and Argentina is definitely a second-tier nation when it comes to a relationship with the United States.

Tom Shannon: You know, this is really interesting in my opinion, first of all because of the change that's taking place in Argentina, because the Argentine people have decided that they were not only going to step away from Peronism, but they were going to step away from the traditional opposition to Peronism and go with somebody who promised radical change. And this I think fits into a larger narrative that the Trump administration will attempt to use to its advantage, that the Trump administration is the change agent and that people in search of change need to be associating with it. But while Milei is offering a radical approach, the diplomacy of his arrival in Mar-a-Lago is actually very traditional Argentine diplomacy.

Richard McColl: Okay.

Tom Shannon: Because Argentina, if it can't get along with Brazil, is quite lost in South America. And therefore historically, when it finds itself in these circumstances, has always looked for an external partner that can strengthen Argentina's position in the region and in the world. And for many years that was Mexico. But under AMLO and now under President Sheinbaum, Mexico has no interest in South American politics or diplomacy. It's addressing its own internal issues. And so for the Argentines, that only leaves the United States. And something similar was done during the presidency of Carlos Menem and the presidency of Bill Clinton when Argentina became a major non NATO ally of the United States.

Tom Shannon: And in many ways, you know, although President Milei has been busy firing his foreign minister and other members of his diplomatic corps for taking traditional Argentine positions, in many ways what he has done, you know, by courting President Trump is very traditional and very Argentine.

Richard McColl: Okay. And do we feel, I mean, obviously before moving on to Mexico. Nicely put there. But do we feel that Milei is angling for support in some debt restructuring or at the very least some support in dollarizing the economy in Argentina?

Tom Shannon: I hope so. And you know, congratulations to him, you know, for getting through the door, for making this contact, because very few people have been able to do it. And that should be understood as a big deal. Yeah, but let's remember when Mauricio Macri was president of Argentina, he was a personal friend of President Trump's. I mean, they had a relationship that was independent of politics and preceded Trump's rise to the presidency. And yet when Macri was running for election, the Trump administration did not offer its assistance in any meaningful way to President Macri and they let him lose. Which for me was astounding given what President Macri was prepared to do for the United States. But it's all related to President Trump's trade and investment agenda.

Tom Shannon: In other words, President Trump was not prepared to open the US market to Brazilian products, which would have been a huge. Instead, the most they were prepared to do was offer to indebte to deepen Argentina's indebtedness by pushing a 60 billion dollar loan through the IMF. Which was foolishness, but it was done at great expense and cost. And so it's my hope that if the US wants to be serious about its relationship with Argentina, if it wants to be serious about the success of somebody like President Milei, that they're prepared to engage with Argentina in a manner that is meaningful for Argentina.

Richard McColl: And much is being made, of course, of this friendship, diplomatic friendship between Milei and Trump. But also usually in the same paragraph or usually in the same breath, the mention of President Bukele of El Salvador comes up. As someone who's set to benefit probably from a Trump relationship. I find this questionable, but I'd like to know your opinion on that.

Tom Shannon: A couple thoughts. First of all, President Trump admires people who are successful. And President Bukele has been one of the most successful politicians in Central America and maybe all of Latin America. I mean, his popularity numbers, many years into his tenure as president are sky high. I mean, they're Kim Jong Un numbers. They're numbers that you would never expect in a democracy, but they reflect the way that he has responded to his own people and the way he has sought to address issues that are meaningful to them, like security, but also the way in which he has attempted to change a narrative inside of El Salvador and get El Salvadorans to not look backwards, but to look forward. And I realize there are many people who are uncomfortable with many of the actions that President Bukele has made, especially on the security side.

Tom Shannon: But then most of these people have never lived in neighborhoods where they can't go outside their homes without putting their lives at risk. So that will be attractive to President Trump, and it's already attractive to members of his family and to influencers like Tucker Carlson and others. But in many ways, the big test here is going to be a migration test. And what President Trump is going to look for are leaders in Central America who can stop the flow of people, and not just Salvadorans, Hondurans and Guatemalans, but all those who move through those countries to Mexico, to the United States. And ultimately, you know, with tens of thousands of gang members held in prison, what President Trump doesn't want is any of those gang members coming north.

Richard McColl: Definitely. Well, as we gallop across the region, it seems that the appropriate moment to mention Mexico here. President Sheinbaum, as you said, this is going to be a challenge for her. She doesn't have the, I would say the character or the personality of López Obrador on this one. And the threat of trade tariffs, well, that's going to be hanging over her quite significantly. Do you think, do you think that she could use, you know, migration as leverage, you know, to take down tariffs with the administration?

Tom Shannon: You know, it's not called a Mexican standoff for nothing. I mean, the United States has leverage over Mexico because of trade. Mexico has leverage over the United States because of migration. And in many ways, one of the most successful relationships during the Trump administration within our hemisphere was the relationship with Mexico during the presidency of amlo. And although Claudia Sheinbaum is not amlo, she's a very skilled politician. She's somebody who has governed one of the largest conglomerations of people in the world in the Federal district of Mexico, and who won an election in a country extraordinarily important to the United States, but also deeply fractured by economic differences and competition, by security challenges and issues. And, you know, the U.S. mexico relationship, in many ways, is going to be a bellwether about.

Tom Shannon: In other words, if the US and Mexico can find a way to move forward, then I think there's hope for how this administration relates to the rest of the hemisphere. But there could very well be some tough and scratchy moments at the beginning. But it's my hope that the Mexicans, who are very able, who understand the United States well and have deep experience in dealing with our eccentricities and the peculiarities of our domestic politics, we'll be able to navigate through this.

Tom Shannon: And it is my hope that the Trump administration and a Secretary of State, Marco Rubio, will have the intelligence to understand that if we are going to go face to face with the Russians in Central Europe, if we're going to go face to face with the Iranians in the larger Middle East, if we're going to go face to face with the Chinese at Taiwan or someplace else. Maybe we want to have a secure southern border. Maybe we want to have a country on the other side of that border that is prepared to work with us and doesn't view us with shimmering resentment and anger, but actually sees themselves as part of a larger effort to secure the success and prosperity not just of the United States, but of North America. And if we can reach that point of maturity, we'll be fine.

Richard McColl: This issue of maturity is obviously very pressing, and I would be interested to see how President Trump or of course, Marco Rubio are able to convince national voters that this is important. Because the whole, the idea of America first, the idea of not meddling overseas and then saying, well, we need to work with Mexico would be, I would say, contrary. But you, as we know talking here, it's incredibly, it's entirely related. There was talk, I mean, of course there's talk of mass deportations. That's going to create friction. Of course it will. An increased militarization of the border. What of the threats to send in drones to bomb the drugs laboratories or send in special forces and so on?

Tom Shannon: You know, Woodrow Wilson did that in the pursuit of Pancho Villa and other Mexican, what was in those days referred to as bandits who were coming across our frontier into Brownsville and elsewhere, causing problems and, you know, attacking American interests across northern Mexico. And General Pershing, along with military leaders like George Patton, chased Pancho Villa all over northern Mexico and never found him. So all I can say is good luck on that one because, you know, attacks on laboratories, attacks on certain individuals, as we have learned from our own experience, is never enough. And if in that, in the process of attacking the homes of drug lords a la Tom Clancy novels, if the thoughts of attacking laboratories with the idea that by knocking out one or two days worth of production, you're somehow having a profound impact on the flow of drugs.

Tom Shannon: But at the same time, if you're enraging your neighbor, if you're enraging your partner, if you're convincing Mexicans that the United States is not only not a partner, but is hostile to the well being, because there's no doubt that in any of these strikes there will be unintended consequences. Of course, you know, then this is something that will take a long time to overcome. So it's much better to get the Mexicans to deal with this themselves and there's plenty of tools to be used in order to do that. So I'm not convinced that anybody in their right mind would recommend that kind of activity. But I guess we'll hold our breath.

Richard McColl: We are holding our breath. Indeed I am. Yes, I certainly hope not because you were referring to the Clear and Present Danger, Tom Clancy and interference in Colombia at that time. I think it would be unwise. And well, in his first administration, funding was slashed to Central America, which we hope the funding goes into social, humanitarian, and let's say, agricultural projects, things of course, that we hope benefit society and therefore diminish the need for migration, climate, migration and so on, and of course, illicit goods. As being an economic driver, I think a Central American as a whole is always going to be a bit of a thorn in the side. There probably is unlikely to be any engagement between President Arévalo in Guatemala and President Trump.

Richard McColl: But I also, I'm curious and when we think of what's coming up next year, the elections in Honduras, because of course, being a major transshipment country and of course route for migration, do you think there'll be some sort of. Well, will the government address the elections or be involved in the elections at all?

Tom Shannon: I really don't know. What's striking for me about Honduras, and it's a country I know well and I've worked on in any number of iterations, is that it's the only country in Central America and in fact all of Latin America that has a relatively permanent US troop presence at Soto Cano airfield. And the US has been flying out of Soto Cano for decades in support of operations in Central America, but now increasingly in support of counter-drug and counterterrorism operations. In fact, almost all of what we do along the north coast of Honduras in an effort to interdict drug flows are because of our presence there and independent of how people might understand the government of Xiomara Castro. She and her government have been very strong partners in on security issues.

Tom Shannon: In fact, you know, the minister of defence of Honduras has been to US Southern Command any number of times. And the General Laura Richardson, who just left command at U.S. southern Command has been in Honduras any number of times. And in fact, the Hondurans have asked for an increased US military presence along the Mosquito Coast in order to address drug trafficking issues. And then on top of that, the Hondurans are busy trying to build an interact interoceanic railway that will complement the flow of goods and services across Panama and would make Honduras a kind of A strategic point in the movement of goods into the Caribbean and the Atlantic into the east coast of the United States.

Tom Shannon: And they have offered United States kind of first place in how this railway is built and how it moves from one port to another. So there's huge strategic advantage in Honduras, if you can see past the politics at the moment. And it's my hope and understanding that the Trump administration will open its eyes and understand what's at stake in Honduras, which is not a single government. It's not an ideological position, it's a strategic partnership that has been built over time and that should continue over time.

Richard McColl: I think that's it, isn't it? The strategic partnerships that are going to ring true here in this administration. We have been talking a long time, but we haven't even yet addressed elections in Ecuador and of course elections in Bolivia next year. And we haven't addressed Haiti. So perhaps we should move faster. But I'm curious about Bolivia, of course, because of the lithium and what is needed by. Well, at the moment, one of President Trump's best friend seems to be Elon Musk. And Elon Musk will need lithium. And if the US Turn their back, we know that China, Russia are moving in there. Is there going to be a renewed policy towards the MAS in, you know, the party there in Bolivia for lithium?

Tom Shannon: A great question. You know, lithium mines in Argentina, Chile and Bolivia are going to make that triangle of countries influential if they can find some way to define their own domestic policy and approach towards winning of lithium, if they can maintain some degree of political stability and if they can find ways to work together to ensure that those who are coming in search of lithium, whether they be Americans or Chinese, don't pick them apart. And you know, Bolivia has an opportunity, along with Argentina and Chile, to play a central role in a global energy transition. And so it's my hope that it, and I think Argentina and Chile are well on this path.

Tom Shannon: But it's my hope that Bolivia also will understand this as an opportunity to no longer be kind of a hermit kingdom defined by coca leaf, but actually a country that is going to play a central and a critical role in the global economy of the 21st century.

Richard McColl: It's, it's possible, it seems a big ask with the political movements within Bolivia, but things change fast. I think really we should finish on Haiti, obviously, an absolutely, incredibly sad humanitarian tragedy that has been in the making for more than 15 plus years and of course exacerbated by Natural disasters and the assassination of Jovenel Moïse. We've discussed this last week on the Latin News podcast with experts from Crisis Group International. And it really does not make for very positive listening. And the only thing I can see through is obviously President Biden has been trying to convince, well, I mean, I guess the international community in the UN that there should be a peacekeeping mission there beyond the, let's say, the assistance from the Kenyan police. Can President Trump strike a deal with China and Russia to support this move?

Tom Shannon: You know, Haiti is an issue that the United States would prefer to ignore.

Richard McColl: Yes.

Tom Shannon: Until, of course, you can't ignore it. And it's a shameful episode for the United States because in the aftermath of the UN Stabilization Mission, MINUSTAH, and in the aftermath of the departure of the largely inter American Stabilization Force led by Brazil, Haiti has been in a downward spiral that has put the country into chaos, violence and confusion with really significant human cost, not just to Haitians, but even to Americans with the killing of US Missionaries and others. And yet the most the United States can do is try to convince the Kenyans to come in. For me, our desire to ignore our role and responsibility and to not properly understand our interests in Haiti is quite striking. And it's not just about Haiti. It's about Hispaniola.

Tom Shannon: The Dominican Republic, you know, is an important partner of ours and one that has done extraordinary things economically, you know, over the past bunch of years, and yet they have this seething cauldron right across their frontier. And we should be looking for ways to stabilize that entire island, if for nothing else than to permit the Dominican Republic to continue to be a major and important actor in the region, but also to avoid the kinds of migration crises that we've seen in Haiti out of the past. And so this is the problem that I think the Trump administration is going to do its best to ignore until it can't. And that's a shame, because by the time I ignore it's very hard to fix. Yeah.

Richard McColl: So we can expect the humanitarian tragedies, unfortunately, to continue. Well, all I can say really is thank you so much for your time. It has been incredibly informative and your wealth of knowledge seems to have no end. So let me take this moment to say thank you to Ambassador Tom Shannon, former Assistant Secretary of State for the Western Hemisphere Affairs, first under the Bush administration, then under the Obama administration, a former ambassador to Brazil. I could go on with all the accolades on your resume, but as you say, keep it short. Thank you so much for your time. It really has been a quite incredible conversation.

Tom Shannon: No, thank you very much. I've enjoyed it and I wish you the very best.

Richard McColl: Thank you. This has been The LatinNews Podcast. I have been Your host, Richard McColl, talking to Ambassador Tom Shannon. I know you've enjoyed this episode because it has been just truly a revealing episode for the realities or the possible realities of the US influence and the United States under President Trump and of course, his policy towards Latin America. So don't forget to subscribe, tune in, share. And we're back every fortnight with a new episode about something in the region for you to tune into. Thank you again and goodbye.

Outro: You've been listening to The LatinNews Podcast. For more news and analysis on Latin America and the Caribbean, visit www.latinnews.com.

Renata Segura

Renata Segura started her career as a reporter on Colombian TV and a nationally-distributed magazine, before working at the Jesuit-led NGO CINEP in Bogotá. She got her Ph.D. in political science from the New School for Social Research in New York in 2007. Between 2002 and 2019, Renata worked at the Conflict Prevention and Peace Forum, a program of the Social Science Research Council.

Diego Da Rin

Diego Da Rin is a social science researcher, journalist and consultant on Latin America and Caribbean for the International Crisis Group.

Richard McColl: This is The LatinNews Podcast. I am your host, Richard McColl, here in Bogotá, Colombia. This week's very special guests have been on the show before. It's an absolute pleasure to have them here once again. We have Renata Segura, who is the program director of Latin America and the Caribbean for International Crisis Group, and Diego Da Rin, who is the Haiti analyst for International Crisis Group as well. To put it all into context, Haiti has, I would say, gone from bad to worse, but maybe we can offer with our experts here from the International Crisis Group, maybe we can offer some proposals or solutions from their expertise to pull Haiti a little bit further or give some advice as to how to end or bring to a close a cycle of violence and tragedy that makes for some pretty horrific reading. Perhaps we can start with you, Renata. Thank you so much for coming back on The LatinNews Podcast. I think we need to start from the beginning to put our listeners back into context. How did we get to a situation where there are up to 150 armed gangs in Haiti, 12,000 members? These gangs control over 80% of the capital of Port-au-Prince. There have been massacres. The, the gangs are so powerful they've made a coalition. 700,000 Haitians have been displaced. I could go on, but I want to leave it to you.

Renata Segura: Yes. This is, as you well say, a crisis that has been growing exponentially throughout the years. It is important for the listeners to understand that the gang phenomenon is not new in Haiti. This is something that has existed throughout the decades. And historically, the gangs had been used by political and business elites to do their dirty business for them. So mobilize voters, attempt voter suppression, and on occasion use violence against people who were uncomfortable for them. So there has always been these very close links between the criminal and the political in Haiti, which is something that remains at the core of why it has been so difficult to really fight the gangs properly and be able to demobilize them. The situation, however, got much worse in July of 2021 when a bunch of Colombian military and other mercenaries came into the house of then President Jovenel Moïse and murdered him in his room in the middle of the night. And this triggered, for obvious reasons a very serious political crisis, but it also empowered the gangs to start a rampage that hasn't yet ended. At that moment and for the next almost three years, what we saw was a very strong confrontation between the gangs trying to gain territorial control. And the reason why they want territorial control is because they use the roads for trafficking people, drugs other illegal groups. They do a lot of extortion of local communities. They kidnap. And their income is quite attached to the territorial control. And that triggered the first wave of violence that really put Haiti back on the international map. However, things shifted in February, late February, early March of this year when then Prime Minister Ariel Henry was out of the country and the gangs took this opportunity to, instead of continuing to fight each other, create a sort of coalition and turn their forces against the state. Diego doesn't like when we say coalition because it makes it sound a little bit more formal, more permanent than what it is. Essentially, what it has been is a series of coordinated actions against the state. And that's what we have seen for the majority of 2024. So attacks against police stations, they attacked the jails, which got emptied out with these attacks and that has continued to be the crisis for this year. Two windows of opportunity have opened recently, and I think it's important to think about those, not because they have changed the situation on the ground so much, but because they are spaces that the international community and others can support, so we make sure that they don't close. So the first window of opportunity is that the Haitians, finally after a long time of debate and polarization, were able to create a transitional government. This was done very much under pressure. CARICOM, the US, France, and others really when these attacks in early 2024 started, said "Okay, we really need a transitional government that unites Haitians, that brings together the majority of the parties." And so there's been this government. It's not working super fluidly. There's a lot of tensions between the different parts of the government, but it exists. And without that government, it would really be impossible to change the security situation on the ground. So it is really important that government remains and that the international community supports it to do so. And the second window of opportunity that opened was that in June and early July and since then in a, in smaller amounts, we've seen the first deployments of the Multinational Security Support Mission. So this is a mission that was approved by the Security Council last year. It's not a UN mission. It is a, a Kenya-led mission that has been paid mostly by the US. It's mostly military, military police from Kenya, but also some military officers from Jamaica, Belize. Now El Salvador has promised some help. And so this mission has arrived in the hopes that it will be able to work together with the Haitian police to change the situation It hasn't done everything that we had hoped it can, but it's there. And so that's something else that we can consider a window of opportunity that, that should be supported and encouraged so that they can help the police really tackle the violence.

Richard McColl: As you say, it's there, and it's only been a few short months. But equally I think there's been displeasure or a kind of despair at how slow things are moving because the need for change now is immediate. Reading what the Haitians are going through and what Port-au-Prince is suffering. Maybe Diego, you could give us some, some background from your research and investigations into what's going on on the ground.

Diego Da Rin: Yes, of course. And what Renata was saying that I don't quite like the word coalition for Viv Ansanm. Viv Ansanm, this is new, a kind of gathering between the two rival coalitions that were warring for the hegemony in the capital and elsewhere in Haiti between the, these two groups that were called the G9 and the G-PEP. And, but what we are seeing now on the ground is that they are actually starting to become a formal coalition. They're really trying to coordinate operations on the ground. They are getting along in terms of distributing the resources that they share along the main roads. So they are starting to get along, and this is a, a huge risk because this coalition started because of many reasons, but mostly because the gangs understood that if a foreign mission was to be on the ground, they would have to fight together against a stronger force. Now, the, the Kenyan mission has around 500 officers that are on the ground. Some of them are administrative officers who are on the base. And all of the officers are not at the same time patrolling and making operations. So the deployment phase was expected to last about five months. That would be until the end of November, and by that point, some 2,500 officers had to be on the ground. We understand right now that this won't be possible. The target is now between 1,200 and 1,500. So the mission is will have very limited capacities to try to support the Haitian police to just to contain the expansion of the gangs. Because what we have seen in the past months is that in the capital, the gangs have withdrawn to their strongholds mostly until 17 of October, which is a national commemoration day of Jean-Jacques Dessalines who declared Haiti independent in 1804. And on that symbolic date, the gangs started again making coordinating attacks in the capital and in other regions. So they are overstretching the capacities of the police and showing they can paralyze the country any time as they did in February, March, and April. These attacks haven't had the same intensity as they did some months before. This is clearly a sign that it may be in anticipation of the additional contingents of the MSS that are expected to arrive this month. Some 600 Kenyans, also from Bahamas, from Belize, from Salvador, and showing that maybe one just over 1,000 officers won't be enough to really, not to subdue them, but to contain their attacks.

Richard McColl: Let's say 100, a, a thousand officers, and I would assume that the majority of those would be positioned in the capital itself. What is the gang structure and their control of the rest of the country of Haiti? Are they pretty much positioned all throughout the country? Can they control the country and bring it to a standstill?

Diego Da Rin: They have always, gangs for the past decades have had some presence in other cities, mostly coastal cities where there is money, and along some of the main roads. So along the main road, the national route one that communicates Port-au-Prince to the northern parts of the country, there has been gangs for some years. But for the past two or three years, there has been a great expansion of the gangs in the Artibonite Valley, which is the region where most of rice and other commodities are produced in, in, in Haiti. And these gangs from Artibonite are now connected to the gangs in the capital. And when you really want to paralyze the country you can do that to a very high extent if you control and paralyze the capital, because most of the products that are brought into Haiti come from the ports of Port-au-Prince. Most of the fuel, 70% of the fuel that enters the country enters through Terminal Varreux, which is located in between territories of the gangs. So anytime they want to paralyze the country, they start by paralyzing the capital.

Richard McColl: Oh, and you bring in, both of you bring in interesting context, obviously right back to history, and we talked a bit about Jovenel Moïse his assassination. But Diego also, brought up the context of the attacks by the Viv Ansanm on that very important date. And of course, I'm thinking about was, his name's Barbecue, but it's Jimmy Chérizier, the, one of the heads of one of the gangs, discussing and stating that any interference by foreign forces will be seen as an invasion. It all comes into the kind of a language that stems back to this, this feeling and resentment towards foreign, and I use the word carefully, 'cause I know in the last conversation, intervention in Haiti is not seen well, and even by the civilians themselves, when you look at the Blue Helmets and the UN interventions that led to the cholera outbreaks and then various other scandals. Are people changing their attitudes? Is there an idea that, I think it's the US that is backing potentially moving from a multinational security support mission, that's a mouthful, moving from that and transitioning into a, let's say a, a UN force that actually is more- militarily deployed around the country. Renata?

Renata Segura: Yes. I think the sense that we have, and obviously it's very difficult to know what the totality of Haitians are feeling at this point, is that the situation has been deteriorating so much and the expectation that people had for understandable reasons, that once the MSS got into Haiti, things were gonna change quickly, and they haven't seen that they would be open to an intervention from a peacekeeping operation. As, as you were saying before the, there was a lot of reluctance on the part of Haitians to welcome the UN because of the cholera that happened after MINUSTAH inadvertently contaminated some water sources. And also because of what they call in Haiti the MINUSTAH babies, which is this number of young women that became pregnant by MINUSTAH peacekeepers, and then they left the country without ever taking responsibility for the children they left behind. So there was this sense that the UN didn't have enough accountability and the UN had at that point not really recognized their role in the cholera outbreak. However, given the situation that Haiti's facing right now with like a, again, a spike in violence in recent weeks we do sense that Haitians are being a little bit more open to the idea of peacekeeping. How realistic that is, it's still to be seen. Obviously a peacekeeping operation needs to be approved by the Security Council at the UN. We know that Russia and China have been very reluctant. The, the MSS had to renew its mandate this past October, and during those negotiations here in New York, the US had hoped to put language in the resolution that welcomed the transition into a security, into a peacekeeping operation, and that language was not accepted by Russia and China. And so it wasn't mentioned at all in, in the resolution that ended up being approved. But the US is clearly looking into this again, and there is a resolution that is currently being discussed at the Security Council in the hopes that they can approve it next month when the US will be the president of the Security Council. And in the hopes that peacekeepers will be able to be in Haiti before December of 2025, by when elections should be taking place. Obviously everything that happens at the Security Council is, as everything else in international politics, a question of negotiation, right? Obviously the Security Council dynamics are very complex because multiple interests come to bear. So there's Gaza, there's Ukraine, there's a lot of the things that are being discussed, and so maybe concessions are being made in one case to get approval on this other. As of now, we have not seen any sign from either from the Russians or the Chinese that would say that they are changing their minds. But, those are negotiations that were not private to, and so maybe that could happen. But without that approval there's going to be no security, no peacekeeping operation. So yeah, we're obviously keeping a very, a close eye on, on, on what's happening here in New York.

Richard McColl: So we could say quite openly that the, let's say, Russia and Chinese interest opposing a peacekeeping operation, exhausting the, the security support mission now is entirely part of the, the greater game in geopolitics at the moment?

Renata Segura: It is. There, there's been a sort of rethinking of peacekeeping operations overall after several in Africa, like Mali and others, were closed rather abruptly by their host countries. There is, I think, a whole sense... it's interesting because this is a very in the weeds conversation that happens here in New York. But for a while people were thinking, "Oh, maybe the MSS is the model that peacekeeping is going to have in the future," right? "Maybe that's what we're moving towards rather than being blue helmets. This is what's going to happen." But I think what the MSS experience has showed us is that it's not only a matter of will. It's mostly a matter of resources. And obviously the way in which UN peacekeeping is funded, it's much more direct and automatic than the MSS that we have in Haiti right now, in which there needs to be voluntary contributions. And money has been a big part of the question, right? We obviously don't know if this mission had been fully funded, whether it would have worked in the way that we would hope it would. But because there has been no money, there's no way to know, right? There's been not enough money to deploy the right amount of people. The, they don't have the resources in terms of equipment of the correct weapons. They don't have helicopters. They don't have vessels in the ocean. So that is really complicated. So a peacekeeping operation wouldn't face those problems. There is a troop contributing country process that would resolve that and so would the funding. The question though is a peacekeeping operation really the kind of force that the violence that we're seeing in Haiti needs, right? And that, that is, I think, where the debate really should be. In a lot of the peacekeeping operations around the world what the blue helmets do is make sure that warring parties, after there's been a ceasefire or a peace agreement, make sure that they don't get into combat again protect civilians help implement political process. We're not just there in, in Haiti. That's not what's happening. What we need is actually proactive security interventions against the gangs. We need troops that are actually willing to go into those strongholds where they are and actually take action remove them from those areas. Are the peacekeepers going to do that? That, that is the question that, that needs to be decided. Now, they have in the past in Haiti, that was a little bit of what the mandate of MINUSTAH was. They did it. It wasn't so easy, it wasn't simple. There were a lot of problems around them, but that, that's where the debate is.

Richard McColl: And all the while, the humanitarian disaster and crisis continues. I find myself asking as well is obviously we know what's going on in Haiti and we read about it, but obviously the, the neighboring Dominican Republic is a massive influence here under, newly reelected President Abinader once again, and his promise for mass deportation of Haitians up to 10,000 per week. What are your thoughts on this Diego, about what's going on the island? And Haitians themselves in the Dominican Republic seem to think that the president there is, is diverting attention from other issues, making the Haitians the scapegoats.

Diego Da Rin: This is another, chapter of a long history of confrontation and tensions between the Dominican Republic and Haiti. And yes, and he has-- he made the promise, and he has been doing so, the president and the Dominican administration. In the first three weeks, there were over 30,000 Haitians that were deported, sometimes in very rough conditions. mothers, with their children sometimes also, women who are trying to get to a decent hospital to give birth. And, as, as on the Dominican side, they are doing this, the Haitian authorities have also struggled to give a right response to these mass deportations. for now, there are just little sites in which the deported can stay for a night, and then they are transported to big cities near the, the border points where they are. They have they are given a small amount of money, but of course, it is not sufficient to deal with all the problems that a displaced person is dealing with. And also, of course these are additional people who are now displaced in the country to the estimated over seven hundred thousand displaced people who have had to flee their homes, mostly people from the capital, but also from other regions, mostly because of violence. And many of these of these displaced people have gone to be-- to look for a house but they don't have money so they go to public schools. And many around, and I don't know the exact figure right now, but a month ago 39 public schools in Port-au-Prince were occupied by thousands of displaced persons who I, I recently visited two of the schools and these are completely horrendous circumstances in which they live. They don't have enough food. They don't have access to, to clean water. Although there are some NGOs and public officials who try to send some aid, but it is never as sufficient as it should be. And the government is now trying to implement a program to relocate the displaced people who are in these public schools. But I think that relocate is a big word because what they are trying to do is just to give them some money for them-... to go away, but it is not sufficient to last at least three weeks with that money,

Richard McColl: and so you were there recently you said visiting this country which gangs have killed upwards of 10,000 people in three years. And you said, the lack of clean water, they're giving a displaced people within the city or deported once again from the Dominican Republic. This has all driven up the price of food. When you were on the streets, when you were there's nothing like boots on the ground and hearing what is going on from a first person experience. Could you perhaps give us a little bit of a description of the costs of food spiraling out of control? And I've also read about the, the gangs moving into also marine violence as well. That's piracy straight up there. Perhaps you could tell us a little bit more about the images on the ground when you were there.

Diego Da Rin: Yes. First about the boots on the ground, you don't see them so much.

Richard McColl: Okay.

Diego Da Rin: Because they're just a small amount of officers who are, some of them in Pont-Sonde, where there was a massacre in early October, where over 100 people were killed by a gang in retaliation for their support for a vigilante brigade. It's a self-defense armed group as they have been spreading in other areas. And there was some Kenyans that, that went there with, to support the police. Also, they have been going to other regions. And in the capital, they are also scattered in many neighborhoods. So when you get the chance to see a patrol, you just see just some armored vehicles. You very seldom see the Kenyan officers going out of their vehicles, and this is something that Haitians make Haitians very frustrated because they don't see them as the police going on foot making operations. So you sometimes see some armored vehicles patrolling around the presidential palace that no longer exists after the 2010 earthquake. But it's a symbolic place where the power, the, the presidents would have to be working. But because the security conditions are so dire there, they are not doing that. And the, the armored vehicles are also patrolling all other parts of the city that were completely abandoned by the police for some months when the gangs mounted these coordinated large-scale attacks in the capital. But they haven't been able to really consolidate their presence in the areas that they have been patrolling. So they're constantly under attack. As for the food- the, the, the, the prices of food have been increasing as the overall crisis has been deteriorating. Because the one, there are two main ways by the gangs to disrupt the market of food is because they on the one hand extort almost all economic activities in their territories, including, of course, the public markets. And so if you are a food vendor, you have to sell your food at a slightly higher price if you have to pay an increasing amount of money to the gangs to have your stand. And also the gangs have been increasingly establishing illegal road tolls along the main roads. So when the food gets to Port-au-Prince, when it has to be transported to other regions it is more expensive. Also the other way around, because there are the Madame Sahara who are the women who go to, to, to agricultural regions like Artibonite, also in the south, and who buy from farmers' food and get it to big cities. And they are also they have also to pay these illegal road tolls to get their food to the city. So all these illegal economic resources from the gangs make that food is increasingly expensive not only in the capital, but also in other regions.

Richard McColl: It's, it, yeah, the, the it, again it's a nightmare reading and a nightmare obviously you saw in person there. I, it leads me to thinking, and it's something that, that you said earlier on, Renata, when you talked about the close links between the criminal elements and politicians or the business elites and political elites. Is this continuing today? Is this a reason for the strength of the gangs? Because all it seems to me, I, and I, in the most superficial manner of saying it as a journalist here behind a microphone, that the, that we are looking increasingly, if not already, at a criminal state.

Renata Segura: Yeah, it's honestly, at this point, it's more like a fail state than any other thing. But, Yes it is definitely still the case. I think what we have seen in the last two years, which has made the situation even more complicated, it's a certain degree of autonomy that the gangs have gained because they've had economic gains. They have multiple resources that go beyond the money that their patrons would give them beforehand, but those links still remain. So we have a little bit of the worst of both worlds because we have these connections to the elites. And this is something that is when Diego and I are trying to analyze the, the attacks of the last few weeks, for example, it's like, you need to be very careful to try and really understand what is happening. Is this just a violent dynamic because the gangs wanna take over this territory or another, or is this some kind of political manipulation because we're starting a political campaign, right? There's supposed to be elections next year. It remains to be seen if the conditions will be there for elections that are, like, remotely legitimate or that enough people can participate. We've seen in the past elections in Haiti that have had very small proportions of participation around 20% if I'm recalling correctly, because the, the situation wasn't right. But there is a plan to have an election, right? And so because the state is also such an important part for access of money for corrupt actors there is very big interest in winning these elections. And so you have to try and understand that it's not always immediate to the eye, right? If the attacks are being motivated by the the gangs' interest to gain money, or are they being sent by political actors to try and cause disruptions because that, in some way, will benefit them. So it is a very tricky circumstance today, but it is definitely the case that the response that the international community and the Haitian state itself has been able to produce to reduce violence given the dire situation and the numbers of deaths and displaced and people raped, et cetera, it's so dire. There hasn't been a moment to really try to think that step forward of how to break those connections between the elites and the criminal groups. And that is something that as long as that remains, we're going to continue to see this happening. It's interesting because when MINUSTAH was in, in Haiti around seven years ago that they left. When they did manage to reduce violence a little bit, but now what we're seeing is that the gangs really just went underground. They didn't demobilize. It just they strategically stopped. And they're ready to reappear. So even though the quelling of violence is very important and it's very urgent considering what's happening, it's also important that any intervention from the international community, I will say intervention Because at this point, that's where we are. But it is important that any intervention really understands those very deep roots where violence and criminality overlap in Haiti. Because if that isn't broken, we're going to see a situation that these, recur in the future. Obviously Haiti's not the only country in Latin America that has this kind of, of problem, right? Mexico perhaps is the biggest country where you can see almost like a full synergy between criminal groups and authorities in certain parts of the country. Colombia, there's been, like, this very long history of connections between paramilitary and people in power. This is something that we are seeing over and over. Venezuela, we don't even have to start explaining the connections between the, the regime and the criminal groups. So this is something that is not only pertaining to Haiti, but the ways in which it has been instrumentalized, the way in which the gangs have been mobilized in the defense of political interests is pretty specific there. And it has to be taken into account if we're ever going to really pass the page on violence in this Caribbean country.

Richard McColl: It seems to me that rather than making claims in the US about Haitians, unfounded claims about Haitians and Springfield. Perhaps US negotiators or whomever, experts could negotiate and open dialogue with the important elites, political elites in, in, in Miami, I would imagine, rather than allowing... Why would they allow, why do they want to allow their compatriots to suffer so much, it seems to me that the negotiating location needs to be Miami, and then the people are the ones who are suffering the most in Haiti itself. And all of this discussion and obviously around migration and criminals coming up through the southern border, but you the discussion needs to be about how to stop the issues in the countries of origin and how to invest. And when you have a, a, the security mission that is underfunded and understaffed, it seems pretty hopeless. And I think we need to wind this down because we could go on forever. But are we really sure that there might be elections by the end of 2025? Will the Transitional Presidential Council under Leslie Voltaire, will it be able to continue a mandate? I leave this with either of you, because it seems to me that everything is incredibly uncertain and unstable.

Diego Da Rin: I think it is really unlikely that elections will happen next year.

Richard McColl: Okay.

Diego Da Rin: And if they happen the, the risk is that this won't be fair and transparent elections because... there are many scenarios that are being discussed about what to do with the security problem when you want to have elections. So maybe to have to make people vote outside the areas that the gangs control, or maybe, for example, just to forget the West Department where the capital is located, and other regions where it would be very difficult to make elections, like free elections. So many scenarios are floating around but the only thing we are sure is, and certain about is that the security is not improving. And that there are also many problems with the electoral process because there was an electoral council that was established, but only seven of it, of its members were appointed. There are two still missing because the two sectors that were called upon to, to give their representatives have not agreed upon a single candidate. And there are many ingredients that anticipate a post-electoral crisis. I think that it would be unreasonable to make elections just to be sure that there will be just maybe elected authorities- but that won't have the legitimacy and that, and the trust of the Haitian people to really recreate democratic institutions in Haiti.

Richard McColl: So we can say that we suggest that if it's possible that the rest of Haiti, minus Port-au-Prince, has some sort of elections and in, could it be a, like a domino effect? I don't know. Renata's shaking her head.

Renata Segura: It's just, the, the majority of the voting population is in Port-au-Prince, so to me that seems like a, an iffy proposition. The international community, for understandable reasons, seems obsessed with having elections in Haiti because they wanna have a legitimate government and move on. But I think we really need to look at the experiences of the past when the US and others have made Haitians have elections when the conditions on the ground weren't appropriate. And really what we ended up was essentially with a mafia regime that we had until very recently, it's having elections is only good if those elections really reflect the will of the people and it actually strengthens governance. And sham elections as we know, it's something that it ends up being more detrimental. So we really hope that the US and others continue to work in the hopes that the situation will be appropriate for elections, but we'll be able to recognize if it isn't, and we'll stop pushing the Haitians to organize elections if the situation is not ripe for them to be actually something that works towards peace and instead might backfire. Obviously the goal is at some point to have elections. There's not one single elected official operating in Haiti. So that is centrally something that, that we need to look for, but really the security comes first. Unless people can go to the votes to the voting centers, willingly and safely and make, and vote for the person that they think is best. Without that, it's just a farce and we should not be supporting that kind of move.

Richard McColl: And there's no way of ensuring security and safety of the voting public getting to the urns in Haiti at the moment. I can think of no better place to bring this to an end discussing potential or not, as it may seem, elections in 2025. Let me take this moment to say thank you so much to Diego Da Rin, who is the International Crisis Group analyst for Haiti, and of course, Renata Segura, the program director of Latin America and the Caribbean. She joins us from New York and Diego Da Rin in Mexico. I've been your host here in Bogotá, Colombia, Richard McColl. Thank you for listening to this informative, if tragic, discussion of what is going on in Haiti at the moment, but that's what we're here for, to keep you informed and to go a little bit beyond, a bit deeper into the news with experts in their field. So thank you again for listening to The LatinNews Podcast. I've been Richard McColl. Goodbye.

Dr. Oviedo is an Associate Professor at UCL's Development Planning Unit. With over fourteen years of international experience, he has focused on studying social, economic, and spatial inequalities in urban environments, emphasising the role of urban mobility in reproducing (in)equality and well-being. Dr. Oviedo possesses extensive experience in leading international, interdisciplinary research in the global south that engages with vulnerable and disadvantaged communities using participatory methods in low- and middle-income countries.

Intro: Welcome to The LatinNews Podcast, a fortnightly deep dive into key developments from across Latin America and the Caribbean. Here's your host from Bogotá, Colombia, journalist Richard McColl

Richard McColl: This is The LatinNews Podcast. I am your host, Richard McColl, here in Colombia. This week we're going to be talking about urban inequalities, transport infrastructure, and well, topics of this nature with our very special guest Dr. Daniel Oviedo, who is in London. He's the associate professor at UCL's Development Planning Unit, and he's focused on studying the social, economic, and spatial inequalities in the urban environment. So welcome on The LatinNews Podcast, Daniel.

Dr. Daniel Oviedo: Thank you, Richard. It's a pleasure to be here.

Richard McColl: It's an absolute pleasure to talk to you, 'cause this is a topic that's very close to my heart, something I studied in ex- quite extensively in downtown Bogotá. So maybe this is something that we could jump off into, thinking about Bogotá and the inequalities of a Latin American capital city when it comes to transport, health, work and the likes. Perhaps you could jump in, Daniel.

Dr. Daniel Oviedo: Oh, definitely. And I think that one of the things that's, Worth mentioning about the Latin American city, particularly the large Latin American city like Bogotá which has over 10 million if we consider it in its entirety is that we are dealing with a long history of self-reinforcing inequalities, right? So we have a, an urban form the shape of the city that began from that traditional city center in the case of Bogotá would be Centro Histórico, and from then on all the opportunities were there. And everyone who couldn't afford anything nearby started settling in the periphery. And of course where you have the more the more opportunities, the more jobs, the more attraction, you get also more infrastructure. So that's where transport comes in.

And the way that transport starts creating these connections and disconnections lead to the poorest people not being able not only to afford anywhere nearby to where they actually need to go to work, but actually to have from the public sector much less investment in infrastructure of whatever kind. You can think about buses or any other systems for high capacity or efficient public transport. That's something that is probably not going to prioritize those areas in the outskirts. So you have essentially what was one city becomes two. And the city for the poor is that where you need to travel for an hour or more if you're lucky to get public transport or where you need to walk because you don't have other choice.

And that's something that we've seen repeatedly across the region and that in a way has marked that divide between the haves and the have-nots in terms of mobility. Now that's the bleak vision of it, right? But also is worth recognizing that Latin America is been a, an incubator of innovations around mobility. The bus systems that we have in cities like Bogotá, bus rapid transit system, actually has addressed that very unequal urban form by increasing speed and capacity. And now we have governments who, local governments especially, who are purposefully investing in the urban peripheries to transport with systems such as the aerial cable car.

So- we deal with a long history of inequalities, but at the same time, I think that from the transport sector, there are very interesting examples to look at in Latin America about how to precisely start reducing a bit those inequalities.

Richard McColl: I find this so very fascinating. Of course, as you said, the sort of the bus system in Bogotá, it's the TransMilenio, a a bendy bus system that has...
was adopted from Curitiba in Brazil. And I would say it would- the investment was good, but it would need further investment and to be applied to other transport systems such as you said, the cable car. I know that it, is it in Soacha in the very far, I want to say, east of the city in a very let's say working class where people have to travel two and a half hours to their work each day. And I know in El from La Paz in Bolivia, they've got the cable car up to El Alto. And of course Medellín is the incubator, almost like the original incubator with its it's got its metro system, the cable cars.

They put in trams and the, of course the escalators in Comuna 13, which have saved- thousands of people time getting to work. Where else can we point to in Latin America that have been truly let me say, forward-thinking in this respect? Yeah.

Dr. Daniel Oviedo: There are many. Of course you're referring to the most visible ones, which are the infrastructures. And yes, definitely TransMilenio taking on from the experience of Brazil. What it did fantastically was to add layers and layers of capacity to a system that nobody thought could compete with metros, right? So at its peak, TransMilenio were, was able to move over 45,000 people per hour in one direction, which for a 10th of the price of of a rail system. And then as you correctly pointed out, Medellín started investing in not only very poor areas, but actually very violent areas because they first tried cable car as transport, as public transport in Comuna 13, which was infamous for its its legacy of drug dealing and so on. And that, of course, has been taken forward. The case of La Paz is a full network of cable cars.

It's not- so it's where probably the only place in the world where cable cars have actually become the default choice for many people rather than a way of connecting with a higher capacity metro. But I think that Latin America, the it's an incubator of different solutions, which are very interesting- both from the public and the private sector. So to give an example from the public sector and I'm sorry, I'm going to stick a little bit more a little bit longer with Bogotá and to move to another one.

Richard McColl: It's fine

Dr. Daniel Oviedo: by

Richard McColl: me.

Dr. Daniel Oviedo: Is for example, in terms of policy, which doesn't involve infrastructure, but piggybacks on the fact that there is infrastructure available for designing subsidies that are targeting the poorest of the poor. Of using systems for allocating general subsidies like not transport related, such as there is a system for classification called Sisbén in Bogotá- which essentially gives you a score and the lower your score, the more likely you are to be in conditions of poverty. Co- Bogotá in particular did something very interesting, which was using data which came from social policy and applied it to transport policy to provide subsidies to enable low-income populations to access public transport cheaper. And that's an innovation that is something worthy looking at for replicating elsewhere.

Then if we look at the popular transport side for example these collectives of things that you might find elsewhere in the world, like such as in Asia, like the tricycles, the rickshaws, the motorized rickshaws- which have become a very interesting solution for different types of mobilities. In a research we did recently in Costa Rica we found that for example, there was a whole system and a whole economy around the rickshaws su- supporting the hotels in moving tourists around in an area where you would otherwise don't have much in ways of a taxi or any way of- of transport. So I think that is interesting to see how from the, from different levels there are innovations. you see now in the States the concept of microtransit, which is essentially Uber-izing colectivos is quite common.

But for example, La Guagua is a private company in Caracas which came up with a, with an application pretty much like Uber to start providing services for public transport on demand- in a context where because of the... We're not going to touch on the complexities of Venezuela, but in a context where there was not much in the way of public transport provision that could respond pretty well to at least to a segment of the demand. And that was a digital innovation that was quite interesting, and is with its the couple of grains of salt that we need to talk about these things and technology it was quite positive. And it was an innovation that came from the private sector.

So we that there is innovation on policy, there's innovation from the sort of informal and grassroots innovations, but there is also this very entrepreneurial private sector which sees transport in the region as an area for coming up with new ideas.

Richard McColl: So it's like you said, though the urban transport, as you say, innovation, it's an incubator. It's not social policy, but it piggybacks on social policy. Yeah. And I guess all local politicians very much understand that transport is if not the most key issue for their neighborhoods.

Dr. Daniel Oviedo: Yeah. And I think that- perhaps that's a transition that we're experiencing at the moment and it would be something that would be fantastic to see happening more in the future, and is to start seeing transport not as a sector of policy in itself, but as a form of social policy. And part of the work that we've done here at the DPU, but also many academics in Latin America has been to point out at that, at the social value of transport investments and transport infrastructure. So probably different to many other sectors where you have different ways of estimating what's the value of a public investment.

I think in transport you can actually start pulling out all of these different added values and these different reasons for continuing investing in closing accessibility gaps and economic growth and the reproduction of opportunities of reducing the burden, for example of women who are taking caregiving responsibilities for the most part in the region. So it starts becoming a conversation that transcends this idea of the physical is... th- that transport is about roads and vehicles, which is definitely not the case. And for many politicians and decision-makers, that has become more and more apparent over time

Richard McColl: So it's not just about building your way out. Now, I guess we could say presumably what we're getting at here, better transport connections en- entirely tethered into a more socially aware I would say transport, a policy. That will enable better opportunities for people and presumably as well, this lack, a lack of these trans- this transportation it continues this cycle of poorer, Yeah
opportunities, poorer health and social exclusion.

Dr. Daniel Oviedo: Definitely. And in a way, and you frame it perfectly when you say it's about access to opportunity. So it's seeing that transport is not in itself about mobility because unless we are embarking on a journey across the Andes where the point is actually to look at the landscape. We don't travel for the sake of travel. We travel because we need to go to, from work to the hospital and so on. And it's that and that means that if we change the policy from a policy for mobility to policy for access, your choices for what to do goes much farther than infrastructure because you can start, okay maybe it's easier to take a plot and put there a hospital or put there- a building that sort of brings together different opportunities such as what's happening with the care blocks or with this idea of the planning for proximity.

And the beautiful thing about Latin American cities now stepping away from the big Bogotás, Mexicos and Buenos Aires- is that those are very much still compact cities where people walk, cycle and, or have at least the conditions to do and we could invest much more in sort of seizing those opportunities and making it easier for people to access stuff, walking and cycling

Richard McColl: this would point towards the, I guess it's what is, it was obviously widely praised in Paris when they were talking about the 15-minute city. But as you say, a city like Bogotá or Lima, Buenos Aires, it's going to be very difficult. So we're looking at intermediary cities I would think. Again smaller ones with less, the imagination of a chaotic Latin American city, but the smaller ones tend to be, as you say, more compact, more accessible. Perhaps you could give us a few advan- examples.

Dr. Daniel Oviedo: Yeah, definitely. Not to discard the large cities though, And partly it's because it might be that our current mega cities are a collection of 15-minute cities. And actually with our research that we did in various cities in Latin America, what we found was that, because during the pandemic, everyone had to access locally. And you could actually measure that within 15 minutes, let's say, not always walking, but at least cycling, there were quite a few things in terms of the numbers. Now the question there is what is the quality of that? So there are opportunities to seize in terms of that.

But if we look at cities like like Montevideo- which is another capital or Asuncion in Paraguay, where the, not only the population is relatively small still by comparison, but actually the territory hasn't really gone through that explosion of both high-income and low-income development. There are opportunities there to use the transport infrastructure as a way to stitching together that- territory and that boundary. You know that's where you need to start growing, not so much in distance, but in height. So you use the public transport as an anchor for that development and see it as more than infrastructure, but actually as an engine for getting the city to have more mixed land use in surround of the stations and so on.

So I think that's probably one of the powerful ways in which you can leverage that kind of infrastructure to make that vision of what we call a, an city. Let's not stay let's not be obsessive with the 15 number. Yeah.

Richard McColl: I think if, 15 is the is the utopia, isn't it? But 30 minutes you'd still be happy with. Yeah, of course. And Montevideo obviously lends itself wonderfully to cycling and to walking. The design of that city. I think when you talk about, so let's say building up- building up and mixed use. Obviously, there's been, there was a huge move towards this in Bogotá, but it would be about renovating a lot of the downtown sectors as well. There's a lot of empty buildings, and how do you get people back into them? How do you get people back into the places which they've seen as I would say historically contemporary history as insecure obviously poor transport links, no education, or education that they don't want. How do you get a middle class into these areas?

Dr. Daniel Oviedo: I think you start by convincing the developers. And in a market economy one of the instruments that as the state we have available is incentives. And it can be that I give you some specific incentives, or I increase your capacity to build your floor or your ratio for how high you can go, or I can give you, like, very specific conditions for having more premium developments alongside more affordable ones so you don't lose that social mix. So th- there are different ways in which from infrastructure, from the development of infrastructure, you can actually provide the developers with the incentives. At the end if what I as the government am committing to is I'm going to build you a shiny new metro, let's say, which is what is happening with the first line of Bogotá- You are going to benefit from that, right?

Because that's not something that you're, "Okay I'm going to charge the same next to the metro that I do in an area that has no bus lines or..." It's something that people are willing to pay. So what I'm asking you as a developer is, okay how do we play on that gain that you're going to have and you're going to transfer to whoever is buying it? Or how are you contributing so that public space around that same infrastructure near to which you want to build has what you just described? So good public space that we can invest more into for example, the more presence of social infrastructure or that we can have a park.

So those are the things that I think is convincing the developers that it's in their best interest not only to invest nearby that area where we're opening the accessibility- but also that renovation is going to come alongside that investment. And in many cases, this could be something as simple as let's renovate the, and do a whole transformation of the downtown as a conversation that many people tend to find radioactive, which is let's pedestrianize certain streets. Because you then- you do tend to find lots of pushback, especially from those who own the commerces nearby. It's like, "No, I'm going to lose everyone. I'm going to lose all my, my demand." And what has happened 90% of the times is you get many more people because it's nice. It's nice to have an area you can just walk and it looks nice, and it has trees and so on.

So I think it's... You need to get the developers on your side, and then the market might respond positively. But the conditions need to be provided from the building the city side, rather than saying, "People, let's move to the center," as it is now because everyone's going to say with reason "Hell no."

Richard McColl: I can understand. I, because as I say, I've spent a lot of time in the areas of Los Mártires, Santa Fe, and downtown Bogotá. And these, for those who don't know, these are the real inner city parts of downtown Bogotá. But it's that division. There's a socioeconomic division largely created by the construction of two I would say north to south highways within- the city. The Carrera Décima and the Caracas. I know that in the US it's in St. Louis. It's I think it's called the Delmar Line, and I think in the Bronx, in New York, there's the highway that goes through this part that's being dismantled now. And then obviously there's a move internationally to take these major roads out of cities. But they are also a cause for this the, again, this socioeconomic divide between one side and another within with- within meters.

And you look at downtown Bogotá, and it's less than, I think less than a kilometer from the presidential palace, what used to be the Bronx. Known as the Bronx in Bogotá, which was a nefarious few blocks where everything goes. The most horrendous situation for people, for individuals and groups. Drug trafficking, drug consumption and everything else. Now, it was demolished, but nothing was done for this, let's say, transient community. And so they've just gone elsewhere and they gather in the same area. And I would say a lot of this has to do because of these divides. What can be done? Because in the '70s in a lot of these cities Latin American ones in particular, the whole idea was an automobilization. The cities are created. We need roads. We need six lanes. We need this.

What more can be done to improve accessibility and and I would say a flow between socioeconomic- divisions?

LatinNews: This podcast is brought to you by LatinNews, the leading source of political and economic news and analysis on Latin America and the Caribbean since 1967. Access LatinNews' full portfolio of reports at www.latinnews.com.

Dr. Daniel Oviedo: I think that on the one hand, we have come to the realization that it's not possible to depend on automobility as the way of building cities for the future. Yeah. It's an unfortunate legacy of the way that, and here I'm speaking as a transport engineer and a planner that was trained in Colombia, right? And where the utopia and many of the things, the classes that we actually took were about road capacity and how do you maintain what was called level of service, meaning that you by no means enable the car to lose too much of speed. You don't want to have congestion, but then the response to congestion is never to build more lanes because it's only going to attract more cars. So I think we've come to realization of stop planning for the mobility of vehicles and start planning for the accessibility of people.

I think that's one of the things that has changed, and goes back to one of the points that we were touching earlier. And in thinking about that more holistically, we think systemically and see that transport, you might have your metro or your TransMilenio or your whatever you want as the backbone of your system to cover those long distances, and then use the area and the accessibility that's providing as a way of connecting it with public space, connecting it with sidewalks and more inviting areas for cycling as well to, cycle lanes. And start thinking beyond sort of the sectors and my responsibility or the buck stops when I have built the road or I have built the station, and actually say this is part of building the territory, right? So if I already provided accessibility, what else do I need?

And what else do I need comes from housing, right? And it was interesting because when I started looking at the history of TransMilenio, actually I re- I didn't know that before, but the Metro Vivienda, which was the organ- the part of the government in charge of social housing, it was sitting at the board of TransMilenio when it was created. Same as the Institute of Sports and Recreation. That's thinking intersectorally because in a way it says if these are the decisions that we're going to make around where to put a high capacity shiny new bus that is going to move people very fast who is going to live there? So you need housing. And what else can we do around? We need parks, we need sort of public spaces. So it shows that evolution of thinking like there's no way that we're going to solve this by building roads.

We need to start thinking across and see- I always tell my students that when we need to see transport as a way of literally stitching together the territory. It's, that'... that's your needle and your thread to bring things together. And I think that's a powerful logic to think about how do we transform areas like Mártires and some of what you were referring earlier. But that you need a point of entry, and the point of entry will never be a road. It might not be an ambitious sort of demolition and the build of a shiny park which nobody's going to use. It needs to be an integrated thing that provides that accessibility whilst it also creates the incentives for the private sector, which has much more capacity than the public to invest and renew and build New and fun stuff that might be bringing people forward to want to live there

Richard McColl: the word you said there is a fully integrated. It's a fully integrated system where everything is brought in at once. As I say, I use it, the transport, the parks, the schools, the housing of all levels. It seems like a it's a beautiful idea, but there's no fast return on that kind of thing I think economically- No
or would you say? That's, there- therein lays the problem.

Dr. Daniel Oviedo: No, there isn't. There isn't and I think it's also part of it's also part of recognizing that change takes time. And that we might not be able to see it immediately, but it's worth doing it. And that goes back to the example of Medellín and many of the other sort of nice things that's happened around transport that we saw in the past. And it requires some courage to some extent, at least to show that it works. Because once you had a good BRT, Colombia alone built six more.

Richard McColl: Yeah.

Dr. Daniel Oviedo: The region has hundreds of kilometres of BRT post 2000 when TransMilenio started. The same happened with the cable cars. Today I was speaking with a colleague who was showing me a photo of the meeting for showing the studies for the feasibility of the first cable car in Freetown, Sierra Leone, and they saw it in Medellín first. So once you've shown that things might work, then they start being replicated because people say, "Okay, now I don't have to be the one that burns by trying this new thing." But we do need to have that kind of a courage and say let's invest in the longer term." And actually, the, if we speak only financially, the returns of those investment, investments that come alongside big transport infrastructures are, for the most part, quite quite good as an investment- option.

But it's being willing to let that monies grow within that time. And that, of course, is something that not everyone is willing to do.

Richard McColl: No. Yeah yeah. The continuation of policy that would make it unpopular because of the lack of immediate return. I think there's also a point here of- changing a mentality.

Dr. Daniel Oviedo: Yeah.

Richard McColl: Changing a psychology. I will, I I shouldn't go into anecdotes, but I go into an anecdote about this one as many years ago I was invited to a press conference with the director of the TransMilenio, who at that time it was a, I think it was under the Petro administration in the Alcaldía, so the current president of Colombia. The director of the TransMilenio was Fernando Sanclemente, who we know has had issues now. He was the former Colombian ambassador to Uruguay. We won't go into that. But I remember we had this press conference, and he was talking about the investment, and he was talking about the benefits, and he was talking about all these things, all correct. But at the end of it- Yeah I said, they said, "Any questions?" And I said, "Yeah.

How did you get here this morning?" And he just went in my car- In my car with my, my driver." And it's it, the responsibility remains also with those people who would usually get into their armored car and have a driver to get out of these. And this is going to be a psychological change. I don't know how you do it because it's so embedded in the region. Colombia obviously- Yeah for the for violence, but other cities too. I imagine Caracas, I imagine São Paulo. These are big cities with violence, crime

Dr. Daniel Oviedo: Yeah. No, it's and I dare say that it's embedded in most parts of the world where the practitioner and the decision-maker on transport still gets gets to work by car. I had this experience in Africa where we were looking at walking. It steps a bit out, but just to illustrate a point- It's fine
Where we were asking people about, like, why It was about walkability. So do you walk to work, or why don't you walk to work?

And there was this person in the Ministry of Transport of a country that shall remain unnamed.
and he was saying "I once tried to walk to my job from a place that was relatively close, like no more than 15-minute walk, and then my wife started getting calls asking whether we had gone broke or I had gone insane, because why was I walking when I could have been going by my ca-" I think that's the, that aversion to- Yeah
anything, but in this case, something as natural as walking is something that we need to challenge. And partly it's that it- it's become something of a default that we started associating success with automobility, right? And sort of this is a symbol of status, a symbol of, social mobility,

Richard McColl: Yeah

Dr. Daniel Oviedo: which doesn't necessarily need to be. And actually I think we're experiencing something of a change as well because of the way that cities have started to transform. So if you see some of the latest household travel surveys for various cities, but let's stick to Bogotá where you see it by socioeconomic stratum. So one to six, where one is the poorest, six is the richest. So you see one and two, the share of walking can be 35, 45%. And then it starts coming down, but then it suddenly gets to six and it jumps up again. So the rich are walking more. And they're walking more because they're getting better conditions and because you have nice restaurants next to where these very nice buildings of estrato 6 in Los Rosales or anywhere else. But that's happening elsewhere.

So I think we need to start closing that gap in convincing the elite that it's cool to cycle, which some of them are taking a cycle to work. It's cool to walk and to do things nearby. It's cool to be clean and that's something that can probably start changing that mentality, but it does come from the training itself and the fact that the way that we were thought to plan was by looking at North America. And North America built their countries based on automobility post-World War II. So it's no wonder that's the same way that those same consultants paid by whatever international development organization were teaching us precisely the same thing. This is how you reach economic growth. This is how you reach development.

I think that's changing, but it's changing slowly partly because there is a more aware, a more exposed middle class perhaps that has traveled more, that has seen other parts in the world that how nice it is to walk in downtown, I don't know, Venice or whatever. And it's something that why cannot we have that? It's that questioning that needs to come as well from the population itself is like There is no reason why we couldn't have more than the ciclovía. Why cannot we walk and play and use our bicycles for more than a few hours on a Sunday?

Richard McColl: I, yeah I think underlying this obviously is the issue of inclusive practices and bringing in vulnerable populations into their work. And I wanted to draw on something that you have you've worked on. And it's it's it's the children in urban mobility and equality. And you have a project called OnTheWayToSchoolProject.org, and it's a comparison, I think, between Bogotá in Colombia and Maputo in Mozambique.

Dr. Daniel Oviedo: Yeah.

Richard McColl: What have you been finding about... Let's talk about children. Let's talk about your findings.

Dr. Daniel Oviedo: Great. And it connects very well to that point about changing mentalities because what we're looking at there is a policy that, it's now a policy. That's the big win. But it started as a program where the concern was simple, is there are too many children dying on the road who might be walking or cycling on their own to school, and they have no way to be safe. So the government at the time, 10 years ago, came up with what is called Al Colegio en Bici to school on bike. And the idea there was to, with facilitators who are public employees of the Secretary of Education and Secretary of Mobility, to go with a group of children, essentially a school bus without the bus, and then each of the children got, for the year a bicycle. That program five years ago was extended to the same notion, the same concept, walking.

And today it has been rolled out in tens of public schools in Bogotá. So the first evaluation of the program was it's very positive in terms of reducing the risk of children, and there is quite a lot of other things like pedagogy. So they go playing, they play games they interact with the community, they feel safe. The parents save time because they don't have to walk their children to school. So we set out to see something that nobody has evaluated so far, and it's whether by doing that you also provide better physical health, physical ac through physical activity and the reduction of obesity and sort of those risks. But also wellbeing, mental wellbeing. Yeah.

So we're doing the evaluation of the program and we're finding actually very interesting things in terms of maintaining levels of physical activity, creating social capital, building social cohesion. And the children are generally happy. You just need to sit down and talk to them. They say I love my route to school. I used to..." I remember a conversation that I had with a child who is a beneficiary of the program, and he said "Look I had to wake up like two hours before the start of my class because I was the first that was being picked up by the school van that my parents were paying for them. And so I was for an hour traveling, losing sleep, and so on.

Now my, I, my parents take me to the point of the route and I cycle and I have fun and I compete with my friends, and that's what we want to look at which has been a fantastic opportunity. But then because as we started this conversation, Latin America is an incubator of innovations. We thought we need to start learning more from our peers, thinking about sort of the broader global south and the developing world and that's where the connection with Mozambique is. So part of our research is not only doing that evaluation, which so far is looking quite promising although we're still collecting and analyzing the data, but also learning from the process of what needed to happen in Bogotá for that to be able to be successful To test it in Maputo.

So what we're going to do is we're working with Architecture Without Borders in Mozambique and with a university there. We're going to have two pilots in two schools. One is going to take children walking, and the other, which is a more peripheral area where the distances are longer, we're going to buy
No we are not going to buy. We got gifted actually from a private donor 25 bikes which we're going to be using to test that pilot, and that's happening in about a year from now. So it's a conversation that started where we as the university in the north we're essentially a facilitator between a fantastic team of researchers in Colombia with Universidad de los Andes and various faculties as well and the government there with the government in Maputo and our colleagues in Maputo who have already started sharing experiences.

And we're going to test whether that works in that context which I'm really hoping it will. Yeah

Richard McColl: it sounds like an incredibly interesting project to pursue. As we wind this down, from Colombia and Bogotá and Medellín, are there other cities that you would point to as being incredibly forward-thinking wi-with regards to of course, the, I would say the social equality that needs to be brought in to include more vulnerable po- populations?

Dr. Daniel Oviedo: Yeah. I'd probably think about many efforts that have been made. Efforts need to be recognized even if they're not always fully successful. I think the case of Lima is one where through the BRT they have tried different things to try and connect better what is an, in itself a very challenging area because the territory in Lima is huge. So they have started to make connections between different modes of transport. I think Quito as well the recently implemented metro in Quito. And the sort of the efforts both from the bottom and the top to generate connections with the informal transport is also a very interesting case to look at.

And then one particular example which actually connects with this story that we were having that we were just touching on the way to school is Chile, and they have something that is called the Rutas Bacanes or Bacanis to school, where they have engaged with more of an adolescent population to precisely what we were thinking of before which is making it cool to travel- to school by cycle. And that's going to be a generation of people that is not going to be afraid of going and jumping on a bike and going on a bike to work and not feeling any type of concern or reserves about doing so. So that's probably another good example to look at.

Richard McColl: But it I love cycling and cy- will cycle wherever I possibly can, and will walk wherever I possibly can. I am very aware of the failures in the infrastructure to protect me and the lack of the awareness by buses, trucks, drivers towards cyclists, and pedestrians as well. So th- these things need to change at the very the very root of the cause. It's like we are vehicles as well. Yeah you need to give us equal rights. This needs to change, and it comes back to that psychological transformation and evolution that needs to take place. But as you, as we've mentioned, is that's, and it's been addressed on a couple of occasions, the access to a private vehicle is seen as, an improvement of your social class and economic standing. Yeah. And this, as you said, needs to change. and that's not an easy, that's not an easy thing to combat.

Dr. Daniel Oviedo: No, it isn't. It isn't, but I think as I mentioned earlier that change of mentality in the middle class, which are the ones who are getting the newer cars and so on of seeing cycling as something else is very important. And here I want to make reference to the research of one of my PhD students Orlando Sabogal. He started from a completely different point of view because he wanted to see if leisure cycling, so going out on the weekends in the beautiful coffee-producing zone of Bogotá of Colombia, like Zona Cafetera, that was creating social capital. But along the way what he's been discovering is that those cyclists who tend to be of a higher income, who have a car, because most of them commute by car they start becoming more aware of what it's like to be a cyclist.

So either they start adopting the bicycle also as their way of commuting, or at least when they're driving, they try to protect the cyclists- that are going in front of them. So I think it's, there are different mecha- this is just an example of the different mechanisms that we have to challenge that pro-car mentality, sometimes by literally getting into each other's shoes, and in this case, into each other's wheels of seeing what it's like to be-
a cyclist. And you can have your fancy Lycras and the titanium or carbon or whatever frame for your bicycle for the weekends, but at least that experience is going to give you the consciousness of when I'm driving whatever car I'm driving because I refuse to do mode change, I'm going to do my best to protect Who is literally a fellow cyclist of mine. So I think it's that.

It's finding those opportunities for empathy and for reducing the gap or recognition. I think recognition is the is the key word there, and that comes both from teaching the children how to go to school by bike and walking, as well as leveraging these hobbies, which people sometimes see- the bicycle as nothing more than a hobby to create that awareness and to transfer that connection with the bike in a better way. Plus everything else that is very structural, as you said, of having good quality infrastructure to protect the cyclists in the first place.

Richard McColl: Yeah, definitely. And now I know that you have a podcast in Spanish called Inmóviles. This is to discuss pretty much everything that we're discussing now, just in case everybody is interested.

Dr. Daniel Oviedo: Yeah, pretty much. And yeah, thank you for the space to mention that. It's an invitation as well if you're interested in transport in Latin America. We speak in Spanish with practitioners from all over. So we have from the Mexicos and Costa Ricas, all the way down to Argentina and Chile touching up in more detail about many of these things, about cycling, walking, gender and transport and so on. Yeah.

Richard McColl: Gender and transport. Fascinating. Fascinating. So I will tune into Inmóviles and you can find that on Apple Podcasts and on Spotify. Let me take this moment to say thank you so much to Dr. Daniel Oviedo-Hernández, who is an associate professor at UCL's Development Planning Unit. He- as you can tell, his research and academia has focused on studying the social, economic, and spatial inequalities in the urban environment. This has been a fascinating conversation, Daniel. Thank you so much.

Dr. Daniel Oviedo: Thank you, Richard.

Richard McColl: So I've been Richard McColl, your host here in Colombia. That's right, this has been The LatinNews Podcast this week. We'll be back in a fortnight discussing further topics from the region of interest to all of you. Thank you for listening, and goodbye.

Outro: You've been listening to The LatinNews Podcast. For more news and analysis on Latin America and the Caribbean, visit www.latinnews.com

Edgar Ortiz Romero is an attorney specializing in constitutional law and political risk. Based in Guatemala City, he serves as a legal and political risk consultant while also lecturing in his field. Ortiz has been featured in media outlets for his expert commentary on democratic transitions and constitutional rulings, and he regularly publishes editorials on political and legal issues in Guatemala. His work focuses on analyzing the impact of legal frameworks on governance and political stability.

Intro: Welcome to the The LatinNews Podcast, a fortnightly deep dive into key developments from across Latin America and the Caribbean. Here's your host from Bogotá, Colombia, journalist Richard McColl.

Richard McColl: This is The LatinNews Podcast. I am your host, Richard McColl here in Colombia. This week we're going to be addressing Guatemala and our very special guest is Edgar René Ortiz. He's currently in Washington D.C. and he's an expert in constitutional law and political risk in Guatemala. And so we get the opportunity to take a look. this is about 10 months into the presidency of Bernardo Arévalo and the hopeful changes that may have taken place in Guatemala at the moment. So, Edgar, welcome on the The LatinNews Podcast.

Edgar René Ortiz: Thanks for having me.

Richard McColl: Well, it's an absolute pleasure because Guatemala is a country that is close to my heart, I'm not going to lie. And I have to say that there was a feeling of hope, there was a feeling of change with the election of Bernardo Arévalo. But we have to say he's come up against all sorts of challenges in these last 10 months, not least challenges from an area that is now being referred to as the Pacto de Corruptos, the Corrupt Pact. Perhaps you should give US a little bit of background on this.

Edgar René Ortiz: Sure. So I think we should go back to 2015. Back then we had this special commission from the United Nations called CICIG. And CICIG was a very special particular entity that was called by Guatemala itself a few years ago to help US fight corruption. And this commission that year indicted the sitting president and sitting vice president and put them both in jail. Protests followed the indictments and the streets were full of people protesting against corruption. And it seemed back then that the country was going to change for good. But then in the 2015 elections, that wasn't the same year we had elections. We elected this outsider, Jimmy Morales, a former comedian. And the thing is that during morales years, that's 2016 to 2020, we saw how the political class resisted the fight against corruption. And so by 2017, CICIG continued his fight of corruption and brought charges against maybe 500 people at least, including politics, high-ranking officials, members of Congress, as I said, you know, a president, a vice president, and also some people from the business sector and among others. So back in 2017, there was a backlash. Like the political class said, this is enough, we can't allow this to happen. And they organized this coalition of, I mean, let's call it anti-corruption coalition. And its main goal back then was to get rid of this commission, get rid of CICIG and they managed to do it in 2019. And again in 2019, we held elections again and we elected a guy named Alejandro Giammattei, a former director of the prison system in Guatemala. And what happened pretty much during Giammattei years was that things got worse. the Pact of the Corrupt not only managed to get rid of these anti-corruption efforts, but from 2020 up to date, let's say they advance the agenda in a more anti-democratic way by putting in jail all the people who help during these anti-corruption years. So we have in exile now probably 45 former judges, prosecutors, journalists, who were seen by the Pact of the Corrupt as the faces of this anti-corruption movement.

Richard McColl: Okay, so the Pact of the Corrupt, we're pointing at a high class of politicians, business leaders, industrialists, I would imagine part of the military. They don't want change, they don't want transparency.

Edgar René Ortiz: Yeah, that's pretty much the right reading of the situation. We need to say that probably what is making things worse is that during the last 20 years, probably we have seen the rise of a new elite. Basically corruption itself created an autonomous, a financially autonomous political class. So we have these new millionaires who earn his money by doing dirty business with the state. If you look at Congress today we have Congress of 160 seats, probably 70% of them owners indirectly of course, of construction companies. And they build roads for the state or for the municipalities. So their fortune is a hundred percent dependent on government's contract. And those are the most predatory political elite we have because they are shortsighted. They are very predatory, as I said. And those are the ones who took this more aggressive stance against corruption fighters. And they don't want transparency because they want to make dirty deals with government and they don't want to get caught. And not only that, they want to take control of everything. I mean, they want to make dirty business with everything they see in the state. So every office is seen as an opportunity to earn some money. You will have corruption at very low level in Guatemala, where a boss may charge 10% or 20% of the salary to a person he hires as a way of living. So my point is we have like this predatory political elite that is not only at the elite level, but it's at all levels in office. You know, municipalities, members of Congress and up to the higher positions in the state.

Richard McColl: And Bernardo Arévalo. How is he addressing this institutional corruption in Guatemala? Because obviously it's not a popular move by the opposition. Let's say that he tries to address it. What is his tactic?

Edgar René Ortiz: Well, I would say that maybe we should talk about Arévalo before and the 2023 elections because we need some context. I have been saying since 2023 that are election was a glitch in the matrix for two reasons. First, let's bear in mind that the pact of the corrupt in 2023 had a plan. And the plan was, okay, we're not Nicaragua. We don't have like Daniel Ortega strong leader. We have like a coalition of multiple fragmented political parties. I mean, by the way, political parties don’t mean much in Guatemala because we always select every election a president who belongs to a different political party. But the thing is they had this coalition and the only agreement was we're not allowing anyone from the opposition to win. And by opposition I mean anti-corruption parties like Arévalo's Semilla, but also outsiders. So basically what they did in 2023 election was they blocked any outsider in the election. So they got rid of three candidates who probably would won the election. So the thing is, are won. But he only managed to get 13% of the vote in the first round and he made it to the second round to the runoff against Sandra Torres. As I always say, Sandra Torres, a former first lady. There's only one universal rule of Guatemalan politics and that rule is Sandra Torres will always lose a runoff. Yes, it's true, you know that because you know, Guatemala so basically are all won because he was there. I mean and he was consistent and he has this small party always having this consistent anti-corruption approach. But the thing is he's too weak. They have 23 seats out of 160 in Congress. They barely could, you know, organize a cabinet to rule because they have, you know, small, they're a small party. They don't have like a lot of people to call. Also not many people want to go to the public sector. It's very hard to find a minister that's probably crazy from someone who is from another country. Like why wouldn't anyone want to be a minister? No, nobody wants to be a minister in Guatemala because too dangerous, you may face persecution, whatever. So in addressing the corruption problem, he's in a weak position not only because his minority situation in Congress, but also because he doesn't control the judiciary and the judiciary is not independent. By the way, we can talk about this later. And the fact that the Attorney General's office and this is like the biggest problem of Guatemala right now is in hands of the Pact of the Corrupt. Of the Pact of the Corrupt's. Most aggressive figure, Consuelo Porras. And the AG's office is an independent body, is like an autonomous agency in Guatemala. So President Arévalo has little power over the AG's office. And the AG's office is the one who the last five years has been dismantling these anti-corruption efforts we had and also the office in charge of bringing charges to former prosecutors and anti-corruption judges. So if Arévalo wants to address corruption, he doesn't have the AG's office, he doesn't have an independent judiciary. So. And he doesn't have a majority in Congress. So basically alone in the executive. And he hasn't found his way to bring this anti-corruption agenda into something concrete.

Richard McColl: And Porras, there's no way of replacing the Attorney General. There's no legal mechanism because obviously it would be screamed at for being unconstitutional and illegal. But Arévalo hasn't tried to get rid of Porras.

Edgar René Ortiz: I mean, his efforts to confront the AG were poorly conducted. There's another funny story about anti-corruption years, and that is in 2016, Congress changed the law of the AG to protect the AG, because prior to 2016, the President had the authority to remove the AG basically for any reason. So they changed that and they made it impossible to remove the AG. And now Arévalo is facing that constraint. And the thing is, if he wanted to do something aggressive, he could do it in the first days, but he didn't. He chose a different path. And this is probably the big problem with Arévalo in my opinion. Like he's too democratic minded for a country like Guatemala. And his understanding of how you would transition from this semi-authoritarian regime to a democracy is probably in my opinion mistaken because he thinks, okay, if I have this democratic attitude, things are going to change. And the thing is, the problem is that other actors are behaving in a, you know, straight anti-democratic way, especially the AG. And he chose a path that was basically destined to fail. He summoned the AG under a very dubious legal argument and try to remove her for disobedience. And of course that didn't work. And he lost like three, four months. And the only thing he managed is that the AG got more aggressive. She tried to bring charges against Arévalo and she started a fight, I mean really straight fight against Arévalo. And she managed to build coalitions. I mean, this is crazy. If you look at the AG, she's holding meetings with members of Congress and mayors all the time to show her strength. And that's pretty much what are achieved with this weak strategy to strengthen the AG's figure.

Richard McColl: This is obviously incredibly concerning and negative for the presidency. Again, that offered change. But there have to have been, or have there been some achievements by the current president and government in dealing with some of the institutional corruption? Because we've mentioned it's top to bottom to top corruption, low level, high level, mid level. Arévalo had to start somewhere. Have we seen some positive news?

Edgar René Ortiz: Well, I mean, I think that the fact that Arévalo is in office is a positive news. You know, it's positive news, yes. The very fact that he's in office because they tried last year to prevent him to take office. And by the way, I mean you could see the streets full of people protesting to defend the elections, especially the indigenous sector. And so the fact that he's in office is good news. Also the fact that he's a democratic president, I mean, with democratic attitudes is good. And he has appointed, I would say, a decent team of ministers that are trying to change things. And I think that you can say, you can criticize Arévalo for many things, but at least he is trying to have decent people in key positions. And I will say, for example, the infrastructure minister, that is toughest job in the executive branch, probably because all the corruption is focused there. Because as I mentioned, many corrupt politicians have these companies who do their deals with the state. And the guy is very committed to end corruption there. And he's trying to do it. Of course, it's super hard because the former government already signed a lot of contracts that are dirty but are binding to the government. So they have to pay to these dirty, corrupt companies. And they are trying to revise the contracts And to clean the house. And that's taken them of course, a lot of time and it comes at a cost also. And that is that it's probably like the biggest challenge for Arévalo because sometimes you are, you get slower at adjudicating these contracts for building roads or bridges because you need to be sure that you're not giving the contract to a dirty company, for example. And that's the situation pretty much right now.

Richard McColl: And you see Arévalo and his democratic attitudes again, very refreshing for a country like Guatemala. I think back to the trial of Ríos Montt, and then of course the election of Jimmy Morales and so on. Álvaro Colom, I think of all of this politicians not with a lot of favor. And now what you're telling me is obviously when we talk about the challenges facing Arévalo, the Pacto de Corruptos, the Pact of the Corrupt do appear to be firmly entrenched in the institution. So you say the infrastructure minister has a hard job, he has to go through all of the different contracts. But are we in danger in three years time or you know, when the next election rolls around that it will just swing back to the Pact again and will it be business as usual?

Edgar René Ortiz: That's my main concern because at the end of the day are can do much in office.

LatinNews: And this podcast is brought to you by LatinNews, the leading source of political and economic news and analysis on Latin America and the Caribbean since 1967. Access LatinNews full portfolio of [email protected].

Edgar René Ortiz: I see the country like in the middle of two forces. You'll say are represents this democratic agenda. Like this dream of, you know, we want to live in a democratic country, we want to fight corruption. And the other extreme you will find the anti-democratic, let's say core a group of the Pact of the Corrupt. But in the middle you have like these transactional politicians who are not actually that anti-democratic as probably Consuelo Porras is. You will find there in this, what I call transactional politicians, short-sighted politicians who want to do dirty business. They don't care much about staging a coup against Arévalo as probably the AG is. But the thing is they are looking at both sides and they are saying, okay, Arévalo looks really weak. It may not be smart for me to join Arévalo's ranks because I may lose or what happens very often that if you are thinking of joining Arévalo's ranks and you're a, let's say transactional politician, you will receive threats from the AG and you don't see Arévalo doing anything about it because he claims I can do anything. Sorry. So at the end of the day it is a matter of time. And I think that the anti-democratic core of the Pact of the Corrupt is playing this dirty game in which they are waiting for Arévalo to become less popular. And when he becomes less popular, because it's obvious if you're not achieving big goals, you will become unpopular over time. So that would be like the moment to attack and to try to overthrow are government. You know, you can only, you only need an impeachment majority in Congress, which is 2/3, is not easy, it's not impossible. And that's to me like the biggest risk of the country in the short term or medium term.

Richard McColl: And when we talk about an impeachment that would be, again, a peaceful way forward. But is there a possibility of an armed coup? Because it does seem like there are plenty of interests certainly at odds with Arévalo.

Edgar René Ortiz: Well, I don't see that as a big threat in the short term because I think the pact of the corrupt sees Arévalo as weak and they don't think he can do much. And they know something like a, you know, a violent coup or military action is very unpopular. And they are already so unpopular, you know, that they can. They couldn't win an election, you know, with all the money they had. I mean, this is another thing, you know, the Giammattei government, they threw literally millions of quetzales in the campaign and they lost. So they know they're unpopular. They really know it. And besides, the military has changed over time. We don't have, like these old officials that we had in the 90s that really had this mentality of, no, we are taking the power because that's a role. I think this new generation officials has a different mindset, more democratic, let's say. And the most important thing is they don't need the army because they have the legal system.

Richard McColl: Yeah.

Edgar René Ortiz: And I would describe Guatemala as an abusive, legalistic constitutional regime. So all they need is an excuse and a tribunal will say whatever you want and you can stage a coup legally.

Richard McColl: An abusive legalistic what? An abusive legalistic regime. All right, that's an interesting. And also, they don't want to draw attention from the international community to some sort of violent uprising. The US Obviously would not look kindly upon that, neither with any, let's say, allies in the region and more democratic countries in the region, I guess, Costa Rica, Panama, they would not look very favorably along this. But so if we move on from the Pacto de Corruptos a little bit, of course they're involved in what's coming up, but we need to talk about security. And Guatemala has had its fair share of security issues. And I do know that one of the key battles that are, has been picking is trying to fight against extortion. But I don't see or I don't know if there's been any achievement on this front.

Edgar René Ortiz: Well, speaking generally of violence, I mean, if you look at the numbers, homicide rates has been going down since 2012, and that's true also for Arévalo's period. You know, back in August, that's the last data we have, you saw a 6% decrease in homicides during the first eight or nine months of 2024. Extortion is harder to measure because most of the time people do not file a complaint when they get extorted. So you have less clear data to see if things are getting better. I think that the Minister of Interior is a competent person. He used to be a Minister of Interior during the Álvaro Colom years for a short time, by the way, for a few months. He worked for the think tank world for a few years. So he knows what he's doing. And it seems in the short term that they are doing what they can. They are focused on structural measures because one of the, let's say, spillover effects of this anti-democratic attitude we saw in the last years in the country is that they ruined this police reform. We had this professionalization of police reform back in 2010 and were having good results. But in 2018, during the Jimmy Morales years, we saw how, during these crazy attacks against the international community because the international community was on the anti-corruption side. So they saw these officials that were trained during the professionalization years as a threat. So they fire more than two or three hundred professional officials in the police. So I think they're working on bringing those people back or starting a new program because you need a professional police force to address these issues. So I think they're more focused on those structural changes and in the short term, of course they have, you know, made some important raids and important detentions.

Richard McColl: And what are the main security challenges facing Guatemala at the moment? Is there, it's a transit country, I imagine, for the transshipment of illegal drugs from the south. Is there a gang problem?

Edgar René Ortiz: Not like in El Salvador, Honduras. Actually the data we have in Guatemala is that violence was more associated to sometimes personal affairs. For example, we see like higher levels of violence in regions and departments. We call departments the regions where you have a higher rate of gun carriage. So in those regions where people carry guns, sometimes they'll solve their problems in a violent way. So there's a bunch of noise in those numbers. And in this big cities you have a gang problem, but as I said before, not in the size that you see in Honduras and El Salvador. Regarding the drug trafficking cartels, there has been a huge change in the dynamics of drug trafficking in Guatemala over the last 10 years because most of the big barons of the drug, the big drug barons were detained and extradited. Some of them are backed by the way, because they serve short sentences in the U.S. but you have now like this proliferation of small cartels, like small organizations that only are devoted to transit and that work for pretty much every cartel in Mexico. So luckily we haven't seen like, you know, a rising violence among these small operators like you saw in Mexico, because in Mexico you have this violence problem because they are fragmented and they are fighting each other. We have this fragmentation with Guatemala, but luckily we haven't seen like much violence yet.

Richard McColl: That's good to hear. One thing that always jumps out at me, again having known the country very well, is the issue of development, but not so much development, but indigenous rights. You have a vast population of original indigenous inhabitants in the country who have always or routinely been seen as the underclass and treated as the underclass in Guatemala. In fact, when I remember back to 1998 or 1999, when there was the, I guess it was a referendum on whether all indigenous languages would be, you know, would be legally binding and national languages in Guatemala, which was of course voted down. But is there a move to improve indigenous rights? Is the government acting out on the demands to I guess lift people out of the inequality and poverty?

Edgar René Ortiz: I would say that definitely there has been a huge shift in the relationship with indigenous groups under the Arévalo presidency. And it's not my perception. I mean, I highly recommend to our listeners an interview, it's available in English, that El Faro conducted to this indigenous lawyer. José Santos Sapón is a prominent figure in the indigenous movement in Guatemala. And he acknowledged that the indigenous leaders have made unprecedented inroads with the Revalos administration. They have regular meetings, they have like a better relationship. And let's remember that back in 2023 when the AG's office tried to prevent Arévalo from being sworn in January, the indigenous movement was key, not only because of the street protest we saw, but let's remember that the indigenous movement literally camped for weeks, for months outside the AG's headquarters as a protest sign. And actually the first thing are did when he was sworn in January 14, 2024 was to visit this camp in the AG's headquarters. And but as Santos Sapón mentioned, I think that the indigenous movements are complex and they are fragmented. They are complex. Sometimes you. He claims that sometimes you will see like people who present themselves as indigenous leaders and probably are not considered indigenous leaders in their communities. But I will say that I will highlight that the attitude of the government is pretty much different. You haven't seen yet like formal legal changes. But this attitude and the fact that he's willing to bring some people from the indigenous sectors into the government positions is definitely a big change.

Richard McColl: It's a big change. And also, I mean, it's a realization and a recognition of a vast percentage of the Guatemalan community, the population. And of course, one of the things that always comes up when we're discussing indigenous rights is that of extractive industries in Guatemala. What kind of extractive industries are there that might threaten traditional lands belonging to indigenous groups?

Edgar René Ortiz: I would say that the mining activity has decreased over the last 10 years in Guatemala, but you still have like an important activity in Izabal, which is the region close to the Atlantic side. And you have like a couple of. I'm forgetting if I pronounce it right, nickel. Nickel. Okay. we have nickel mining in El Estor. Actually one of these companies was sanctioned under US laws and the sanctions were lifted afterwards. There's a bit of confusion with what happened there. But we have an operation there. And you could see the tensions and the complexities of this problem because when the company was sanctioned and was suspended for a few months from operating, you also saw unemployment rates going up and the community actually feeling the economic hardship. But at the same time you have some problems with human rights in some instances. I would say that during the Arévalo’s months, probably the most visible mining problem had to do with a different one. There is a gold mining operation in this region close to El Salvador. And so during the last days of the President Giammattei administration, they received this environmental permit to operate this extension. And after a few months the Arévalo government saw a lot of complaints for environmental problems, especially in the river. And that affected also some communities from El Salvador. And in June the government decided to suspend this permit. And that's probably the most relevant action you have seen over the Arévalo administration.

Richard McColl: Okay, so, I mean nickel gold and so on, it. It's the same. It's a similar story to so many different places. If we talk about, let's say you mentioned El Salvador and of course the, I would say the water, the rivers contaminated, I assume with mercury from a gold mine and so on. But if we talk about Guatemala's neighbors in the region, how is Arévalo when it comes to foreign policy? He's not got the greatest friends around him, I think. Nayib Bukele in El Salvador, Xiomara Castro in Honduras, and Daniel Ortega in Nicaragua. Not great neighbors. How is the relationship going to be with President Sheinbaum in Mexico?

Edgar René Ortiz: Well, with President Sheinbaum, I think he's going to have a Good relationship. He had a good relationship with AMLO too. Mexico always has this Estrada Doctrine, this neutral stance. So they always have good relationship with US and are remember that are has a strong diplomatic background. He was a diplomat himself for a few years, for various years. So I think that's a zone when where he feels very comfortable. I see a relationship with Mexico going smoothly. The region is complicated. I mean Central America is complicated because when he was a president elect during this long period of transition, by the way, we have the six months transition period which is crazy. He made some critical remarks to Bukele and after a few days he just changed his mind and stopped saying things about our neighbors. And he has held hold friendly relationship with Salvador and Honduras. But with Nicaragua he had some strong words recently because of the, you know, the Parlacen, the Central American parliament thing that they admitted Russia as an observer member.

Richard McColl: That's that obviously Panama spoke out, Guatemala spoke out. And this does. Yes, Nicaragua in favor of Russia. When we talk about these kind of regimes. Guatemala still recognizes Taiwan I believe. Is there a possibility of them flipping to China? Probably not under Arévalo right now.

Edgar René Ortiz: Absolutely not. And he made it clear he was in New York a few days ago for the UN's assembly and he had a word in the Council of Foreign Relations in this very interesting and hour long conversation and he was asked straightforward if he's going to, he's considering, you know, moving with China and he said no, I reaffirm our diplomatic relationship with Taiwan. And he even suggested that you know, that's an opportunity for Guatemala to engage in the CHIPS Act of the US to bring some investment to Guatemala and that he was firm with staying with Taiwan. He's, I mean if you look at Arévalo’s, I mean he's sometimes pictured as a leftist in Guatemala but I don't think he's, I mean I don't know if he's a less he's a right wing but definitely he has been very critical of authoritarian regimes in the region and even you know, especially left wing authoritarian regimes like Venezuela. And he not only had these comments on China and Taiwan, but also was very clear about Venezuela for example. And he, he's very clear about how the rejects the results announced by the Venezuela's National Electoral Council and how he thinks about Maduro is not a legitimate president. And you know, he's pretty clear in his foreign policy.

Richard McColl: Well, we have to applaud this kind of behavior. I wouldn't, I would be very hard Pressed to describe are as a leftist, like in a traditional left wing thing, I would say he's more of a pragmatist. But, and as you said, he has democratic attitudes as you've so rightly put. He believes in the rule of law and the institutions. And of course that's what he's coming up against in Guatemala at every turn. It does seem a bit, it does seem a bit negative, obviously what we've talked about. But I do see the positive side of things when we discuss again are own personality, his stance against Chinese regime, his stance against Venezuela, his stance against Nicaragua remaining with Taiwan. Of course we must see this as poverty, as positive. But as we wind this down, Edgar, how do you feel that domestic policy then over time, how do you feel it's going to, how do you feel that it will result in this presidency for Arévalo? Will he have time to actually get anything done?

Edgar René Ortiz: Well, that's the question we all are asking ourselves because as I said at the outset, at the beginning, I see Guatemala situation as a transition of regime, not of government. And to me it's very clear that we had all the symptoms of an authoritarian regime. And how do you transit from that to a democratic regime? And my biggest concern with Arévalo's approach is that just by acting or behaving democratically, things aren't going to change, especially if you don't have the infrastructure of a democracy. I mean, modern democracy is grounded in so many institutional arrangements that we lack, we don't have a civil service, for example. So it's not a matter of if you are a democrat or not. I mean the spoil system is in place. I mean you, all the appointments in the state, in the judiciary are not meritocratic, are by nepotism or any other arrangement. And it works that way because we don't have the institutional arrangement for doing that. So unless you bring like structural reforms to the table, you are not going to be able to change that. And he seems decided to, you know, try to change things with the existing institutional arrangement. And in my opinion that's very hard. I mean it's very hard that you succeed in changing things if you don't actually speak of a constitutional reform to fix like the biggest problems that we have, especially in the judiciary, in the judicial system or if you don't work in, you know, comprehensive civil service reform, for example.

Richard McColl: So we can draw from this. Your feeling is that he's not pushed far enough, he's not forcing back against the Pacto de Corruptos. He's acting democratically, but it's not enough.

Edgar René Ortiz: It's not enough. And let's remember that all Arévalo has is popular support. That's basically his asset. You know, people trusted him against the traditional political elites. And people are tired of these old politicians like in many other Latin American countries. And if you don't bring like actual change, people are going to get mad, people are going to get disappointed. And that's not good for him because all he has is the popular support. If he loses that, we are in big trouble as a country. And that's why I feel like he's in a position where he needs to do something big to demonstrate people that he's actually working on a big change and working on something that will mean that the country is going to change for good. Whereas he's trying to work with the current arrangement. He's just showing that he can do or he can achieve much. And that is I think the place we are now.

Richard McColl: So a big change would be like a referendum on constitutional reform or rewriting of the constitution or something of that nature.

Edgar René Ortiz: I would say. I'm not that ambitious to say like we need to refound the state because probably that's pushing too hard and it may be negative for him. But as I said, for example, you could see how Arévalo is watching this selection process of the Supreme Court and he couldn't do anything. I mean, he saw in front of his eyes how the old system appointed 13 supreme justices like in the old days. Why? Because of the rules of the game. So when I speak of constitutional reform, I'm speaking of how to modernize and democratize the state in the areas where things are not working. And clearly justice is the main problem right now. If you look at the last five years, as I mentioned, the main tool of the Pact of the Corrupt is the justice system. Why? Because if you live in this fragmented political regime, the easiest and more legitimate way of achieving your anti-democratic goals is through the judicial system. The judicial system has more, you know, even though people doesn't trust the justice system is of course more legitimate than the politicians. So every time you see a former prosecutor or former journalist fleeing the country, they say, well, that's the law, you know, they're facing prosecution, they should be fighting for their cases in the tribunals, blah, blah. And that's to me a key reform. If you want to change things for.

Richard McColl: Good, as you said, entirely co opted judicial system by the Pacto de Corruptos. Well, here's hoping for some positive news in the coming years, months and years in Guatemala and that Bernardo Arévalo can, let's say, take the fight to a more level playing ground with the Pacto de Corruptos. Let me take this moment to say thank you so much to Edgar René Ortiz, who is an expert in constitutional law and political risk in Guatemala. It has been an absolute pleasure discussing this with you. Of course, if you return to Guatemala, be very careful because, of course, your opinions are quite outspoken and you don't want to rub the wrong people up the wrong way.

Edgar René Ortiz: It was a pleasure, Richard. Thanks for having me.

Richard McColl: It's been a great pleasure. As I said, we've been speaking to Edgar René Ortiz, expert in constitutional law and political risk from Guatemala. This has been the The LatinNews Podcast. I have been your host, Richard McColl here in Colombia. We'll be back in a fortnight's time with further and interviews from the region. Thank you for listening and goodbye.

Outro: You've been listening to the The LatinNews Podcast. For more news and analysis on Latin America and the Caribbean, visit www.latinnews.com.

Dr. Evan Ellis is a research professor of Latin American Studies at the U.S. Army War College Strategic Studies Institute, with a focus on the region’s relationships with China and other non-Western Hemisphere actors, as well as transnational organized crime and populism in the region.

Dr. Ellis has published over 400 works, including five books: the 2009 book China in Latin America: The Whats and Wherefores, the 2013 book The Strategic Dimension of Chinese Engagement with Latin America, the 2014 book, China on the Ground in Latin America, the 2018 book, Transnational Organized Crime in Latin America and the Caribbean, and the 2022 book, China Engages Latin America: Distorting Development and Democracy?

He has given testimony on Latin America security issues to the US Congress on various occasions, has discussed his work regarding China and other external actors in Latin America on a broad range of radio and television programs, and is cited regularly in the print media in both the US and Latin America for his work in this area.

Dr. Ellis has also been awarded the Order of Military Merit José María Córdova by the Colombian government for his scholarship on security issues in the region.

Intro: Welcome to The LatinNews Podcast, a fortnightly deep dive into key developments from across Latin America and the Caribbean. Here's your host from Bogotá, Colombia, journalist Richard McColl.

Richard McColl: This is The LatinNews Podcast. My name is Richard McColl, your host here in Bogotá, Colombia. This week we're addressing an incredibly interesting topic. We'll be talking about China's growing influence in Latin America and especially with regards to events taking place in November 2024, it's going to be, well, a landmark event and a cluster for news articles about China in this region around then. And I have with me here on The LatinNews Podcast, Dr. Evan Ellis, who is the Latin American Research Professor at the US Army War College. Dr. Evan Ellis, thank you so much for coming on The LatinNews Podcast.

Dr Evan Ellis: Thank you, Richard. It's a real pleasure to be on the podcast with you.

Richard McColl: Well, no, the pleasure is ours because I can't think of anyone more qualified to discuss China's real inroads. And on every different level, I mean, we hear about the Belt and Road Project, we hear about the Global Security Initiative and so on, but it's more important than that, especially now with November coming up. So perhaps you could give us a little bit of a, I mean, a background to current date about China's policies towards Latin America and then maybe we could plunge in and just say, what does China want?

Dr Evan Ellis: It's a great question to start out with. And when I first started following China and Latin America in the early 2000s, a little over 20 years ago, the answer I came with then, even though China's style has evolved significantly and its footprint has evolved significantly, continues to be the same today, which is China first and foremost, in my judgment, wants its own economic benefits and to work towards a strong and secure and technologically sophisticated state. Now, what that means is that it allows its state owned enterprises, its SOEs, to engage first kind of as its national champions, to go after secure access to commodities and the foodstuffs that the Chinese people need, all also to go after markets, especially in strategic areas like electricity and digital technologies, as well as infrastructure projects.

Dr Evan Ellis: Now, in that process, the Chinese companies, with the help of the Chinese state, try to capture as much of the value added in those sectors as possible in terms of vertical and horizontal monopolies. But at the same time, there is a political dimension. I like to describe this political dimension as making the world safe for the continued rise of China. So a lot of times you see these Chinese initiatives to try to secure friendship or at least a lack of resistance, or which is really aimed at Getting China access to those things that it wants and at least no political opposition or alliances against it. For example, with the United States. Now, politically, there's also, of course, pressure with respect to the countries in the region.

Dr Evan Ellis: Seven of the remaining 12 countries that recognize Taiwan and not the PRC are their of course in Latin America and the Caribbean. And there also is a military dimension to it, which is that, again, understanding that different Chinese bureaucracies look at the region in different ways. Ministry of Commerce versus the Ministry of Foreign affairs from the perspective of the People's Liberation army. And again, I've supported our Department of Defense in the US My entire career. But the People's Liberation army can look at this understanding that if someday it has to fight a war, fight against the US in the Indo Pacific, you can be assured that it's also looking at its options in terms of its access, its military relations, its position through commercial presence and other things throughout the hemisphere.

Dr Evan Ellis: So how could it use Latin America to disrupt and to challenge the United States, perhaps putting the homeland at risk throughout Latin America in the event that it had to fight that war, fight in the Indo Pacific?

Richard McColl: I mean, so obviously the US really needs to monitor the growing PRC engagement in Latin America. And I would say specifically at the start here in Peru, as we know at this moment, there are quite immense projects taking place.

Dr Evan Ellis: Yes, absolutely. And it's interesting to see just the level of penetration across all sectors, which is really representative of what China is doing in each country in different ways, according to the resource endowments and according to the particular type of regime that they have. But what you see in Peru is China, because Peru sits on the Pacific, has been involved in a number of sectors for quite a long time. It's been involved in the oil sector, for example, since about 1993 when it got involved in Talara. And in 2013, it greatly expanded that when it acquired the assets in Peru of Petrobras. It's been involved in a significant way in the mining sector, especially copper and iron, for quite some time. A number of very large mining projects.

Dr Evan Ellis: For example, a China Minmetals project called Las Bambas, which has had any number of problems. Another project by Aluminum Corporation of China in a place called Toromocho, some smaller but also important projects. For example, a project by company by the name of Jinzhao in Pampa de Pongo, there's another project Cajamarca, etc. There's even some Chinese interest in lithium, although right now the only lithium that's being developed in Puno is in the hands of a small Italian company. But in addition to that, you have, for example, a broad Chinese presence in the electricity sector, largely through acquisitions, especially companies affiliated with the Chinese giant China Three Gorges. They actually now own the rights for distribution of virtually every place in the greater Lima area, the central hub the country.

Dr Evan Ellis: But also you have Chinese companies that are involved in a number of other projects around the company. A country project by the name of Chaglla, which is a hydroelectric facility that they operate, another by the name of San Gabán. And then of course, in the digital sector, like other places, Chinese involvement is broad and very significant. So companies such as not only Huawei has been there for quite some time in, you know, Since I believe, 1997, in 3G, 4G, now some 5G projects, but also other companies like Xiaomi and Oppo, and even a little Vietnamese company called Viettel gets most of their equipment from the Chinese. And then there are other areas.

Dr Evan Ellis: For example, the Chinese company Hikvision is a big player in surveillance systems in the country, you have Chinese company DiDi Chuxing, which is very important in the rideshare market, competing with Uber, just again, just to name a few. And so you have it, really a multidimensional presence. Now, clearly the big thing that everyone is talking about right now with respect to the upcoming APEC summit, and this will actually be the third summit in recent years that Peru is hosting. And this will be the first time that Xi Jinping returns to Latin America since before the COVID virus. But in 2019, a major Chinese logistics giant, COSCO, purchased a 60% interest in what was then a sleepy little deepwater port operation by the name of Chancay from a local company, Volcan.

Dr Evan Ellis: They are in process of putting about $3 billion into this, to transform it into it really will be the biggest port operation in the entire Pacific coast of Latin America. It's going to transform the port logistics of getting across the Pacific with those big ships and everything that's tied to it in terms of the local port operations and access. But of course, that's also raised some significant concerns for the United States and the security domain because the prospect of how that port could be used to receive and refuel PLA Navy warships during a possible conflict. But that project, at least the first stages of that project, the intention is to launch that when Xi Jinping is there at the APEC summit, really as a symbol of Peru's position as the gateway to the Pacific.

Dr Evan Ellis: And in China, although Chile would have a different way of looking at that claim. But you know, that key port and everything that could be connected to it, including a rail project, these were some of the things that when just a couple of months ago, Dina Boluarte, that the president went to China, these were some of the things that she discussed. Yes.

Richard McColl: Now President Boluarte was in China from June 25th to 29th. So this was a state visit. There's not a high ranking event. And this port in Chancay, from what I understand, the Peruvians changed the rules to permit a 15 berth deep water mega port. This is no small undertaking and as you briefly mentioned, the potential of a railway connecting to this port. So this, and what I've heard from that is that the railway connect could extend all the way across Peru to neighboring countries. So my follow up to this is where does Brazil sit in all this? Because anything that happens with China, of course, Lula, President Lula, somewhere along that chain is connected.

Dr Evan Ellis: That's a great question. And I want to first jump on something very important that you said, which was the way in which the negotiation was conducted. And I think it really illustrates how China, often with predatory practices in conjunction with non transparent contracts with locals who may not have fully the capability to access the risk or the details, oftentimes uses that to secure benefit, both strategic benefit and commercial benefit for itself. I remember from the very beginning when you had the buyout of the Volcan interest back in 2019, that I talked with my Peruvian colleagues and they all assured me, no, under Peruvian law, you cannot operate a port as a private concession and restrict who gets in and out. This will be, you know, under the proven port authority, APN, something that will be operated as public port.

Dr Evan Ellis: So even though maybe it'll compete a little bit with the existing port in Callao, it will certainly not be operated exclusively for Chinese advantage. So what we found in the recent months is that when the details of the contract got looked at, it turns out that after all, COSCO did negotiate a deal where they can say who comes in and out and how the port gets run basically as a private concession, which means that they're in an enormously important position to be able to privilege, you know, their own companies at Chinese mining companies, Chinese companies, which will have a significant cost advantage being able to do these trans Pacific routes directly through Callao as opposed to through other ports. Now when this came to light, a somewhat embarrassed Boluarte administration then said, well, APN didn't know what they were actually doing.

Dr Evan Ellis: They didn't have the legal authority to do this. And so we need to annul this. To which Cosco basically said no, we didn't start investing, you know, already over a billion dollars with the expectation that we wouldn't have this exclusive access. And so it was going to go to arbitration under the clauses of the investment agreement that they set up.

Dr Evan Ellis: But then as Boluarte looked at everything that was at stake, in my judgment, going to China, having this big rollout of, you know, the Xi Jinping visit and the APEC summit and the launching of the port and how that would showcase Peru and a whole other series of things that will be negotiated, you know, with respect to a deal possibly with China Railway for a connection from the port to other places, possibly the construction of a electric car factory BYD in the country someplace, actually a second port by a company by the name of Xin Zhao that we mentioned before in ICA when she looked at everything that was at stake and realized like so many other countries realized, you know, better to just let the Chinese have their way on this thing rather than take the risk of losing all of these benefits.

Dr Evan Ellis: And so basically they folded. Peru literally put a rule through Congress changing Peruvian law to give COSCO these advantages that no other company operating out of Peru's ports in history has had. And so to me that kind of combination of non transparent contracts and being outmaneuvered that is so symbolic of how China has achieved things throughout the region. Now with respect to Brazil, again a very important point that historically just about a half of all of Chinese investment in South America has gone to Brazil. It's been a huge recipient of investment. Brazil. A significant portion of course of their soy goes to China, A significant portion of their iron exports go to China. Increasingly agricultural exports at a higher value added points such as beef and pork are also going to China.

Dr Evan Ellis: So that's created a lot of leverage and indeed a big competition of who realizes that benefit. And so for example, instead of some of the traditional international agro logistics organizations like ADM and Dreyfus and Bunge, you've seen little by little companies like the big Chinese purchaser COFCO China Oilseeds and Foodstuffs Corporation kind of edging into to that market the same thing with who realizes the value added for iron exports across the ocean to China, increasingly Chinese companies and not Vale, but in the Brazilian case again it's a very wide ranging situation where you have again significant penetration in the telecommunications sector with cloud computing services. You have Chinese companies Like Alibaba with respect to business commerce, you have the rideshare company that we mentioned before, Didi, which also has a big role in Brazil right now.

Dr Evan Ellis: You have some port contracts, especially in São Luís, a major project which would give access to the soy industry as well as another major project in the Paraguay Peninsula. So really, as you go across the board, I mean, the Chinese have a relationship with Brazil and space with respect to a program called CBERS. And it's interesting that although under previous governments there had been a reluctance to do military to military collaboration, when Lula first came back in somewhat more radicalized after his short time in jail before the presidency, he came back in really opening the doors to China in ways that you hadn't seen before. And so it was interesting to see that the number, the number two person, basically for propaganda of the Chinese navy, took a big delegation over to visit Lula right after he came into office.

Dr Evan Ellis: And as I understand it, there are already some military to military things going on. And so this will all probably come to light, as you mentioned at the beginning of the podcast, when Lula not only will be there for the APEC summit in Lima, which is itself relatively symbolic because as you can look at a map and see that Brazil is not part of the Asia Pacific, it is an invited company, but the other big stop for Xi Jinping after Lima will be going to Brazil for the G20, which Brazil will be hosting. And so what we can expect is that, you know, although China already very strong as a partner in Brazil, we will be seeing a lot of other big deals, possibly even that railway connecting Peru to Brazil that you talked about, among other things.

Dr Evan Ellis: And so it's going to, I think, create quite a bit of a stir that advance in the relationship with China, Brazil as well as China with Peru.

Richard McColl: I mean, I see this as just this vast blanket coverage by China as an effort to want to seek to dominate global value chains. And it comes back to that first point you made as China wants its own economic benefits and beyond. And I have to ask because of the tensions taking place over in the Far East, where does Taiwan fit into this? Because we mentioned the few countries in the region that still recognize Taiwan, but where does it fit in?

Dr Evan Ellis: That's a great question. So first of all, symbolically within Chinese politics itself, although Taiwan historically has never actually been a part of the PRC, it is really symbolic of the reassertion by China under a communist control of the legacy of territories controlled by various Chinese Dynasties and empires. And so in many ways to bring Taiwan under the fold, especially for Xi Jinping, now in his unprecedented third period in office, will be symbolic of the restoration getting past what the Chinese refer to as the period of humiliation which goes back to, you know, the taking a territory and the loss of military conflicts through the Opium wars in previous century. But what you see is that there was a period in which the previous more PRC friendly party in Taiwan, the Kuomintang or KMT was in power.

Dr Evan Ellis: From 2008 to 2016 there was an attempt to try to negotiate a deal where it would Taiwan would come more under political control with the return of the more hawkish, a more PRC skeptical party in Taiwan, the DPP. In 2016 you began to see a resumption of the efforts to try to convince individual countries that recognize Taiwan to switch. And so when that new fight beginning in Africa with Gambia and São Tomé and Príncipe in 2016, but then it shifted into Latin America with the PRC going after first Panama and then of course the Dominican Republic in El Salvador and of course more recently the flips by Nicaragua and Honduras. But in addition to that, you see of course continued efforts against Paraguay, especially trying to deleverage working through the agricultural producers.

Dr Evan Ellis: A lot of whispering in the ears of beef producers of how much more beef they could sell if only they flipped recognition. Although I was in Paraguay just a couple of months ago and had the opportunity to talk to President Santiago Peña, who is a very impressive person and I think very committed to staying with Taiwan. But the pressure is still there. The same thing in Guatemala where you see that President Bernardo Arévalo's attempts to try to do business with the PRC and stay with Taiwan. The PRC doesn't want to let that happen.

Dr Evan Ellis: Indeed they actually subtly is the Chinese are often try to do they suddenly shut down a significant export by Guatemala of various different types of nuts to the PRC really as a message to say that if you don't flip, not only are you not going to get greater access to the PRC market, but you could lose the access that you already have. And also in the citizenship for investment countries in the Caribbean, so especially St. Vincent St. Lucia among others in St. Kitts, you see real pressure on those people who are essentially ethnic Chinese investors who have actually gone to those places to try to take their money out of the PRC and essentially escape. But there is a price for being let alone by the long arm of the communist regime.

Dr Evan Ellis: And one of those things might be to, you know, to get their support to try to flip recognition by those small island countries. And so those pressures are going on across the board. And there's a couple different risks. Number one is that it is a way of dramatically expanding Chinese presence because every flip that we've seen, you see that there is a corresponding signing of a number of non transparent MOUs. Oftentimes an attempt to negotiate an FTA has occurred with Nicaragua and Honduras and is now underway with El Salvador and has previously occurred with Costa Rica. But that combination, it opens up the market to Chinese companies infrastructure projects and other things. Usually a Confucius Institute is established.

Dr Evan Ellis: Usually there are training programs for the new authorities on how to do business with the Chinese state, but usually involves how to import products from the Chinese state, et cetera. But that combination of things really sets up a dramatic expansion of influence. And from an Indo Pacific standpoint, the big risk as well is that as the number of countries which recognize Taiwan go to zero again, we're already down to 12. The temptation of Taiwan, of the PRC, which is already very aggressive in the south and East China Sea and elsewhere, to say, okay, the country is now isolated. We now feel comfortable doing a, you know, surrounding the island, doing a, an embargo, doing even a possibly military invasion.

Dr Evan Ellis: As the number of recognizers of Taiwan run out, the risks of PRC coercive action in the Indo Pacific and the possible war that could accompany that goes up. So there is a lot at stake in both this hemisphere and in the Indo Pacific and is the game that the Chinese are trying to press very aggressively and especially with the new hardliner, or at least more pro Taiwan, more PRC skeptical DPP government of Lai Ching-te that was literally just elected a couple months ago.

LatinNews: This podcast is brought to you by LatinNews, the leading source of political and economic news and analysis on Latin America and the Caribbean since 1967. Access LatinNews full portfolio of [email protected].

Richard McColl: It is a concern definitely this type of pressure and this, well, that the PRC is using these commercial tools in very, I would say countries with precarious economies to, well, they're creating a global economic order that functions to China's benefit. And I asked now is with the US absence in the region, I mean, the US obviously is here, but they're not building railways, they're not building ports. What can we expect in coming months? We've got the November 5th elections and possible either Trump or Harris presidency. What can we expect in the relationship with us to the global south to Latin America and China, obviously, I would say sort of digging an elbow in this sphere of influence for the United States.

Dr Evan Ellis: That's a great question. So, first of all, important to recognize that there was a bit of a shift in momentum with the COVID-19 virus. And so even though we heard lots about China advancing through diplomacy with respect to personal protective equipment, masks, ventilators, and then, of course, you know, their marginally effective vaccines. But. But there also was a shutdown of progress on a lot of major infrastructure projects because the PRC diplomats and SOE representatives really couldn't travel to the region. And the region really wasn't in position to be able to launch these new projects. And so there was an illusion of less of those big projects that we saw before less announced big policy bank investments, et cetera. In 2023, you actually saw a significant return of Latin America to China.

Dr Evan Ellis: I believe over 8 or more Latin American leaders went to China for a variety of different visits. Nicolás Maduro went actually at the end of 2022. Miguel Díaz-Canel of Cuba went. Xiomara Castro went, of course, Lula from Brazil went. Gabriel Boric of Chile went, et cetera. This year you had Chan Santokhi of Suriname who traveled previous year, Irfaan Ali traveled. And of course, this year is the year that, as we've mentioned, Xi Jinping comes back to Latin American in a big way with this major event in November in Peru and Brazil and maybe Jamaica. You heard it here first. That's not definite yet.

Dr Evan Ellis: But in addition to that, what you see in terms of the substance behind that is, on the one hand, because of some of the economic problems in China, of course, the difficulties in the property sector with Evergrande and the collapse of some of those real estate deals, and also the attention to corruption that was associated with that. Those big projects, especially those that didn't make a lot of economic sense, are not coming quite as fast and furious as before. But what you're seeing is a continued advance in privileged sectors like electricity as well as the digital sectors.

Dr Evan Ellis: And so a lot of cloud computing investments, a lot of 5G pilot projects, a lot of electricity sector investments, especially in key markets such as Peru and in Brazil and elsewhere, a lot of penetration by Chinese companies in the electricity sector, byd, for example, with respect to buses and electric cars, but also Chinese solar panel projects and hydro projects and wind projects, et cetera.

Dr Evan Ellis: Now, on the US side, of course, as you know, this has been watched and we've sadly been a little bit constrained by the domestic Politics and polemics to talk a lot about China, but really not advance a lot of some of the significant spending that we would have liked to do with respect to, for example, what was once called Build Back Better World, which would have had at least a certain amount of new infrastructure spending that could have been channeled to the region. One of the difficulties, of course also has been that there are not a lot of US companies that with things like the Foreign Corrupt Practices Act, have been very enthusiastic about investing in the region.

Dr Evan Ellis: It's very difficult even for friendly companies from Japan and South Korea to really compete against Huawei, given that they already have the underlying infrastructure and a lot of advantages with respect to price. So I think what you can look for is a continued focus on China trying to provide alternatives, messaging, trying to insist on transparency of the projects that are occurring, trying to put more data out on some of the risks associated with not going in from the perspective of strong institutions for contract evaluation and supervision and things like that. And frankly an offer by the US to help.

Dr Evan Ellis: I think there's also some efforts to provide alternatives through the private sector, such as, for example, the Development Finance Corporation as well as even USAID has one piece of that organization which is looking at how can it provide market friendly, pro democratic alternatives while at the same time also doing good, which is what USAID has already done. So again, I think lots of activity, although I think we'll have to wait and see till November, really what direction Some of those activities on the side of US response actually go in speculation.

Richard McColl: A lot of academia, but we have to wait and see is really what the. You mentioned the US and obviously pro democracy behavior. Obviously the concern to many countries and the concern to people watching the region is this PRC threat to democracy. And you mentioned the way that they leverage their power at the port of Chancay and it has been done elsewhere as well. We have a long history of China economically, I would say underwriting, illiberal actors. And we start, I mean, we can go through several of our neighbors here in South America, obviously Chávez in Venezuela, leading to Nicolás Maduro there. Perhaps we could focus one second on Venezuela because it's very topical.

Richard McColl: What stage are we right now with, let's say the Chinese investments and influence in Venezuela because we know that there are huge loans to be repaid by Venezuela and one wonders if they can do it.

Dr Evan Ellis: That's a great question. What I sense is the PRC is playing a wait and see game, although it continues to do a certain amount of work in Venezuela and especially now with the apparent success that Maduro has had in robbing the election this past July 28, other signals that the PRC, as well as Russia and Iran and others, are ramping up their game once again. But important to recognize that historically, first, the PRC has been very good at structuring its loans and contracts in Venezuela, as well as in Ecuador under Rafael Correa, in other places in ways that make sure it gets paid even while nobody else was getting paid.

Dr Evan Ellis: So if you look at the record, it's interesting to note that the loans that were taken out to China, the regime in Venezuela, continued to pay on those up until 2020, when they briefly suspended the principal payments, even though they continued interest payments. And you say, well, why was that? Or how did that happen? Well, essentially what they did, this is something that they started doing back in the late 1990s in Africa and places like Angola and Mozambique. They then applied the model to Venezuela and then later Ecuador and elsewhere, basically securitizing their loans through parallel contracts for commodities. So in the Venezuelan case, what they set up was, on the one hand, China National Petroleum Corporation had contracts to operate or literally cooperate with PDVSA, the oil company oil fields. They would then extract oil at a certain rate.

Dr Evan Ellis: And then when they took delivery on that oil, that was pumped out of the ground, literally by China and then delivered to a CNPC subsidiary at the essentially at the port there in Puerto Cabello. And in other places, they would then give a corresponding credit for those oil deliveries in an account in Renminbi in China. That account, think of it as like a company store or company credit card. And so as the Venezuelans had set up a couple big funds, one was called the Heavy Investment Fund. One was called the Broad Reach and Long Range Fund. So in total, There are about $64 billion from 2008 through approximately 2015 that were channeled through these funds. But the interesting thing about those funds is that you had to use Chinese companies. You could import Chinese products.

Dr Evan Ellis: But at the end of the day, you know, they were basically running up the credit card bill. And then as they pumped out oil, they were basically paying down or making monthly payments, if you will, against those credit card bills. And so whereas Venezuela could make sovereign decisions to say, okay, we're not going to pay this bond, were not going to pay. Even the Russians, they stopped paying during a certain point in time. They stopped playing Schlumberger and Halliburton. They didn't pay court cases against them, but they kept paying the Chinese because the only way to stop paying the Chinese would have been to physically go in and prevent CNPC from pumping oil. And if they had done that, they would have actually undermined their own economy.

Dr Evan Ellis: So on the one hand, the Chinese are and have been much better in controlling risk than we often realize. We just, we oftentimes think, well, the Chinese are, you know, their SOEs are stupid or naive, you know, with the risks of these type of regimes. But it goes a little bit deeper than that. But the other piece is that the Chinese also controlled risk during the sanctions period. So I worked, of course, Under Secretary Pompeo during the Trump administration from 2019 to 2020. And what I saw as we dealt with Venezuela then is that as we ratchet up the sanctions, cnpc, for example, had a lot of exposure with respect to its other international operations. And so first companies like CNPC stopped directly taking oil deliveries.

Dr Evan Ellis: And instead what they did is they started shifting to doing ship to ship transfers off of the coast of Mileisia to hide the Venezuelan origins of the oil. In some cases, they actually changed the characteristics of the oil so it looked like a different type of oil than what they had taken out of Venezuela. Then later, you basically had profiteers who were paid in cryptocurrency. This was a very lucrative operation that people like Cherry Kalasami in Venezuela ran again until they were ratcheted in. And then the other thing that they did, which is interesting, is that CNPC started getting out of that business. And you had a Chinese military company called KDIC which began leasing tankers because as a military company they were much less exposed to US sanctions because they didn't do a lot of business with the United States on international markets.

Dr Evan Ellis: And so I think what you see now is that the Chinese are beginning to have those talks about resuming access. They never left Venezuela. They just have been very cautious. And I think you're beginning to see that they are now interested in resuming some of those activities that again has long been key to sustaining the Maduro regime, as with other non democratic regimes in the region.

Richard McColl: And you mentioned Correa in Ecuador, of course. And then we need to move on to lithium in Bolivia. Obviously the huge seat of lithium, Evo Morales in that period and a possibility, albeit shaky at this moment, that Evo Morales returns in bolivia potentially in 2025. And I think a quote, if we keep moving down the continent, a quote from Javier Milei in Argentina, that he would never make pacts with communists. But clearly there are all sorts of agreements that have been done with the Peronists In Argentina and this relationship is broad and substantial. But you have someone as outspoken as Javier Milei, what is going on there in this complexity of a relationship with Argentina?

Dr Evan Ellis: Sure. And you make a number of great points. And number one is the way in which China has been successful in adapting its approach to doing business with relatively conservative, well, institutions, institutionalized regimes such as, for example, Chile, both under Piñera and now under Gabriel Boric, as well as under a variety of different left oriented regimes which they've adopted different strategies for. The point about lithium is also important because it's one of a number of strategically key resources and lithium, the lithium story with China in Latin America actually extends beyond Bolivia. You actually see that for example, in the north of China, Chile, China went after lithium in one way, which was to go for a 25% stake in one of the big lithium operations.

Dr Evan Ellis: They're a company called Tianqi, getting that stake with the activities of Sociedad Química y Minera, one of the Le Roux companies. At the same time in Argentina, it went after it in different way. In Argentina, the lithium deals are primarily made at the provincial level. And so you had something like eight different major Chinese lithium deals dealing in places like where they've actually done pretty well. As a matter of fact, probably the most lithium that's going to be exported will be exported in the early years from Latin America, from Argentina, ironically, under Javier Milei, because Javier Milei again is making deals at the national level. But as a libertarian, his general posture is that, you know, let companies and let others do what they want to do.

Dr Evan Ellis: And so there's not yet been signs that there's pressure from Milei not to allow the provinces or individual companies in Argentina to do things. The interesting thing about Bolivia is that although there's been a lot of talk Bolivia, whether under Evo Morales or now under Luis Arce, who seems to be equally willing to deal with the Chinese, there's two big Chinese consortium, one a battery manufacturer called CATL and another a citic company, CITIC Guoan, which they signed major deals with, as well as Russia's Uranium One. The problem is, however, that the conditions in terms of the new lithium organization YLB and the things that they want, as well as the quality of the lithium itself, just like other big projects like the iron project in El Mutún that basically frustrated the Indian company Jindal for a number of years.

Dr Evan Ellis: And what you see is a lot of generous declarations of access, but a lot of kind of thrashing around on the Bolivian side to actually get those lithium projects with China off of the ground. And so ironically, probably the most generous access in the biggest fields are in Bolivia. But that's probably not going forward as again, that infighting between Arce and Morales continues as we approach 2025. In the case of Chile, as we mentioned before, the irony in Chile was that concerns over the impact on water tables and of course Gabriel Boric government is very concerned about environmental impacts. And so you actually find that number one, they haven't been able to take the projects forward because of environmental concerns. And number two, Chile wants, just like with copper, to basically have state control over tone lithium.

Dr Evan Ellis: And so that the big consortium in which China has a part just basically signed a deal with the Chilean government which will allow the government to become a partner. And so the Chinese are in a process of vociferously protesting what has just happened. So it looks like the Chilean project's a little bit stuck now too. We often also forget that if we look just to the south of the United States, in Mexico, in the Sonora Desert, there is another big lithium field called Bacanora, which the Chinese thought that they were buying into until national historian Manuel Lopez Obrador said we want to nationalize the sector to which of course, the Chinese company Ganfeng, which had bought into that said we bought this, we thought were going to get develop it. We're not going to go along with you.

Dr Evan Ellis: And so there was a big fight that was taken away from them. And so what's interesting is you see that the Chinese have been very aggressive across the region with companies on both the right and left pursuing the lithium. Oftentimes they like to tie the location of a battery factory or a car factory to having access to the lithium. But what you see is in different ways, it hasn't been a cakewalk. They've been very frustrated. And then of course, just to end the point of what you talked about the Javier Milei, what you also find is that across the region the Chinese have had difficulties with governments that shift from the left to the right. So Javier Milei, this isn't the first time that there's been problems with a China skeptical government.

Dr Evan Ellis: We can remember that Jair Bolsonaro in Brazil, when he was in office, he talked very badly about the Chinese as well. And yet he appointed in his Ministry of Finance the person who'd previously been the head of the China Brazil Business Council. And a lot of business continued to be done despite that rhetoric, especially at the state and subnational level. And so it's interesting in Argentina right now that although the big state to state deals, the military contracts, for example, Argentina's purchase of Chinese FC1 fighters, has not occurred. There's been some pushback on, for example, the Chinese access to the big space station in Neuquén. But business with Javier Milei, despite his rhetoric with China, continues to go on. And that seems to be the pattern that you find in a lot of different places.

Dr Evan Ellis: Whatever happens politically, the Chinese operating blue the scene kind of weave their webs of influence and continue to have that access in the business domain.

Richard McColl: China incredibly savvy in the business world. The mention of the lithium in Northern Mexico, and of course then China withdrawing from that under AMLO's influence. How do we see President Sheinbaum with regards to these investments?

Dr Evan Ellis: That's a great question. To mexico is and will continue to be a big irony with respect to China and a number of other issues. To me, you will probably see essentially technically better governance, but things that will expand the presence of China significantly in ways that will probably cause significant conflicts and make the US profoundly uncomfortable. So one thing that's important to recognize is before Claudia Sheinbaum was elected, the Chinese were positioned in a number of key sectors relevant to Sheinbaum's own agenda. And so as we mentioned before, you know, they had positioned themselves with respect to lithium and Bacanora. They had positioned themselves with respect to clean energy, which is a big issue for Sheinbaum, with the purchase of a company called Zuma, which has a lot of wind and solar and other holdings.

Dr Evan Ellis: They had positioned themselves in the infrastructure sector with respect to work on Tren Maya with CCCC in the south of the country, just to name a couple others. And of course also ironically, under this concept of decoupling, which is the idea that the companies, you know, don't want to be sourcing out of China because they worry that they're going to lose access to the US market, among others. And so they've been moving to Mexico in the maquiladora sector, especially in states like Nuevo León. But the irony was that one of the biggest source of investment under this decoupling or nearshoring in Mexico in the past two or three years, despite some of AMLO's business unfriendly policies, has been the Chinese, because Chinese companies desperately wanted to reinvent themselves as Mexican companies to preserve access to the US market under USMCA.

Dr Evan Ellis: And so as Sheinbaum comes in, a couple things, it's a bit of a perfect storm. Number one is, as we've seen there was the election of an unprecedented number of Morena, the ruling party deputies, basically achieving a near 2/3 and with a few defections, a 2/3, 2/3 majority in both the Chamber of Deputies and the Senate. And the consequence of that, not only is judicial reform, but also I think we'll be seeing is the possibility of changing the law or changing the constitution to push forward on infrastructure projects in other areas in which decisions by the government were previously frustrated. And so you'll have Sheinbaum coming in with unprecedented legislative authority to work with whoever she wants, but especially the Chinese on things like infrastructure projects. Sheinbaum has also been very attentive to near shoring projects.

Dr Evan Ellis: She's been a big promoter of investing in essentially the infrastructure that tracks people in again, patio space with the electricity and water and roads and things that goes with that. And so the irony that Sheinbaum will have more authority to attract more Chinese companies in companies like BYD with their hybrid truck facility that they're talking about, among others, she will have more incentive to try to build up clean energy projects where she'll find that the Chinese already have a dominant position through Zuma and through Bacanora, which she may think about wanting to renegotiate their relationship with the Mexican Electricity Authority, CFE. You will find that in a number of other areas, for example, when you talk about infrastructure, where again, thanks to legislative change, she will have more authority to make federal decisions on infrastructure.

Dr Evan Ellis: One of the big coming infrastructure expansions in Mexico that's talked about a little bit, but probably not enough is what's called the Trans-Isthmus project, essentially a connection across the thinnest part of Mexico from basically just south of Veracruz on the Atlantic side to Port Salina Cruz on the Pacific side. And there's already a train line there, but the development of that port infrastructure as well as patio space and other logistics operations, all throughout that. And again, the Chinese are already there with Tren Maya a little bit to the south. And so it's likely that you'll see a Chinese expansion there. And in the middle of all of that, of course, the key, the trade agreement, USMCA, previously nafta, will be up for renegotiation beginning next year and finalized in 2026.

Dr Evan Ellis: And so just as you're seeing an expansion of Chinese companies in near Shoring, in the electricity sector, in lithium, in other projects, the US increasingly uncomfortable with the Chinese expansion so close to the US border and with access to US Supply chains, will be giving a very hard relook at its key trade deal with Mexico. So probably ironically, technocratically good governance, environmentally friendly governance, something that will expand China's influence and probably in the process tee up a pretty major trade conflict with the United States in the coming years.

Richard McColl: Absolutely fascinating as that's a lot of looking forwards there a lot of questions remain and as I said previously, speculation about where we go and looking ahead at China's investment, which won't, as you've very completely explained, it will not ebb. It will continue underway unless, well, unless the unthinkable happens. But it's same time, it really is something that needs to be more in the news and it needs to be further reported because just this 40 minute conversation with you has gone so very deeply into projects that I know that a lot of our listeners will never have heard of before, but are of incredible importance. Let me take this moment to say thank you so much to Dr. Evan Ellis, who is the Latin American Research Professor at the US Army War College in the United States.

Richard McColl: It has been a truly incredible conversation with you today.

Dr Evan Ellis: Pleasure is mine. Thank you very much.

Richard McColl: This has been The LatinNews Podcast. I've been Your host, Richard McColl here in Bogotá, Colombia. We'll be back in a fortnight's time discussing more relevant stories from the region. Thank you for listening and bye.

Outro: You've been listening to The LatinNews Podcast. For more news and analysis on Latin America and the Caribbean, visit www.latinnews.com.

Benjamin Smith is a Professor of Latin American History at the University of Warwick and a Fulbright All-Disciplines Scholar at the University of California, San Diego. Over the past 16 years, he has published four monographs, four edited collections, and numerous academic articles, focusing on Mexico’s political history. His recent work centers on the Mexican drug trade, with his latest book, The Dope: The History of the Mexican Drug Trade, published in 2021. Benjamin also provides expert testimonies for Mexicans fleeing violence.

Intro: Welcome to The LatinNews Podcast, a fortnightly deep dive into key developments from across Latin America and the Caribbean. Here’s your host from Bogotá, Colombia, journalist Richard McColl.

Richard McColl: This is The LatinNews Podcast. I am Richard McColl, your host here in Bogotá, Colombia. This week we are going to be discussing the Mexican drug trade, its evolutions. Recently. Our very special guest is Benjamin Smith, professor of Latin American history at the University of Warwick, also the author of The Dope: The Real History of the Mexican Drug Trade. So I can think of no one more qualified than to discuss this subject with us than Ben today. So welcome on The LatinNews Podcast.

Professor Benjamin Smith: Thank you. I mean, there's clearly somebody in a New York courtroom in a couple of weeks called El Mayo Zambada. But, you know, you've got me instead. Sorry.

Richard McColl: Well, I think, I wonder how willing El Mayo would be to discuss with Earth some of the geopolitical consequences of his capture and, of course, the recent violence taking place. Let's jump right in. Now. There is a I think we should just take that with that reference, El Mayo being captured and the, well, the feeling of betrayal by Los Chapitos, what is going on right now?

Professor Benjamin Smith: So there's been a kind of unspoken, there have been problems between the Sinaloa cartel, I'm sure many of your listeners will know, is not really a kind of cartel in any meaningful sense of the word. It's a series of clans or family organizations occasionally teamed together to do drug trades, and occasionally don't. There have been tensions between different groups at different times over the last 20 or 30 years. Perhaps the most bloody of these disagreements was between El Chapo and his cousins, the Beltrán Leyvas, which exploded into a pretty brutal civil war from about 2008 to 2011 or 2012 and did really kind of engulf most of Mexico because there were a lot of the bloodshed.

Professor Benjamin Smith: We're worried now because it looks like there has been a division between one group, which are the kids of El Chapo, kids of Joaquin Guzman Loera, and the other kind of main chief of the Sinaloa cartel, Ismael “El Mayo” Zambada. As sure again, as many of your listeners will know, El Mayo Zambada turned up in an El Paso airport in a plane with one of El Chapo's sons. He claimed that he was kidnapped. And now, although there have been differing versions about this, it looks pretty clear that probably was the case. There's whole layers of lies and government obfuscation and clearly the US Authorities aren't telling the whole truth. And clearly the Mexican authorities are not telling the whole truth. I mean, one of the most extraordinary parts of this entire story is that the Mexican government claimed that this is where you.

Professor Benjamin Smith: This is an introduction to what's going on in Mexico. The head of the. The former head of the university was apparently the broker on a putative deal between El Mayo and Chapo's son. He was the one who allegedly was going to broker this meeting between them at which Chapo's son kidnapped El Mayo. However, obviously that pleasant meeting didn't happen and El Mayo was kidnapped and this university rector was murdered. Now, it looks like the government of Sinaloa and the governor of Sinaloa was also meant to be at this meeting. It looks like he faked a video of the rector being murdered, but he wasn't actually murdered where the government claimed he was. It's a complete fake. It's a kind of AI generated fake of his murder. It's absolutely extraordinary, but baffling Byzantine.

Professor Benjamin Smith: So many different players trying to get their version of the story across.

Richard McColl: But we know he's been murdered. Of course, then. But not in the place.

Professor Benjamin Smith: We know that he has been murdered, but not where the government said he was murdered.

Richard McColl: There's almost too much in that last intervention by yourself.

Professor Benjamin Smith: Yes, I do apologise. It was so complex.

Richard McColl: It's okay. Well, I think that perfectly defines what's going on in Mexico. We need to sort of. Let's shuck the corn a bit here and pull off layer by layer and say, what was this agreement? Or what was this meeting that was being brokered? Well, who was standing to gain out of this?

Professor Benjamin Smith: So I think what's quite clear and what's come out is that we've always had a. Most academics will say, and journalists who are not in fear of being whacked will say that there is a fairly open agreement between the authorities of Sinaloa and the drug traffickers. And the drug traffickers pay bribes. They pay large amounts of money basically to be left on their own. At the same time, they do bring it, they tend to try to keep the violence down. Sinaloa has occasionally hit the kind of peaks of assassinations of places like Ciudad Juárez or Nuevo Laredo. But in general it's relatively peaceful, given that it's the center of the drug trade. They also try to keep drug addiction down. It's very noticeable. I have a friend who's.

Professor Benjamin Smith: Who works in kind of drug rehab and he says that drug rehab in Culiacán, in the capital of Sinaloa, no one goes there. I Mean, partly because the Sinaloa cartel doesn't really like to sell on its own patch, but also because everyone's terrified if they went there, they get whacked as a drug addict. So there is this kind of agreement between the government and the cartels. And some of these government leaders clearly work as effectively kind of brokers between different factions that have disagreements. Now, I think what. To me, as a historian, what's fascinating is the rector's name was Héctor Melesio Cuén. Melesio Cuén's grandfather was also called Héctor Melesio Cuén Melesio Cuén's grandfather turns up in the documents that I was seeing from the 1930s, basically running one of the first opium rings.

Professor Benjamin Smith: Rocha, who's the governor, I think, comes from the de La Rocha family. I think he's probably quite smartly changed his name. The de la Rocha family, for about 50 years, had been involved in the opium trade. Both these guys come from Badiraguato. Badiraguato is basically where most of the drug traffickers that you'll have heard about come from. It's certainly where Chapo comes from. It's where Caro Quintero comes from. It's where Fonseca comes from. It's where Amado Carrillo Fuentes family comes from, at least. So, you know, these people are interrelated. They've known each other for generations, and. And there is this disagreement between them and the drug traffickers.

Professor Benjamin Smith: So, you know, the fact that the rector of the university, Héctor Melesio Cuén, and the governor appear to have been involved in some kind of meeting or putative meeting, a meeting that went badly wrong between Maillo and Chapo's son. Actually, not that surprising. One suspects these happen quite regularly. Just they don't normally go as wrong as they did in this case.

Richard McColl: It sounds like we're looking at. It goes far beyond corruption, more into total establishment permeation of this illicit trade.

Professor Benjamin Smith: Yeah, I've always been quite. Yeah, I'm always slightly dubious, but to use the term corruption, I'm not sure it's even terribly useful. Right. Because it can both describe, you know, one single solitary policeman taking a mordida, taking a little bribe for a car, maybe speeding or having a back headlight knocked out in Mexico City. But it also can describe what is de facto, as you rightly say, the imbrication of the authorities and the drug trade. And what I found in my book that I thought was. Was really fascinating is that there is some evidence, not huge amounts, but there is Some documentary evidence that the money from the drug trade not only goes to the massive houses that these governors build.

Richard McColl: Right.

Professor Benjamin Smith: Or their Cayman Islands, but some of it does also go to, basically to civil society. It goes out in terms of. I mean, Sinaloa itself is relatively wealthy and a lot of that money actually does come from the drug trade. It doesn't all just flow out.

Richard McColl: Yeah, it's not even, I would say parallel state. Again, the two things are entirely cross pollinated, the legal and illegal, as you say as well. My kind of point is that it's no longer corruption. It's a de facto. It's. It's what happens.

Professor Benjamin Smith: Yeah. I mean, as I say, I'm not sure that we, I think as a social scientist, I sometimes think we kind of lack the language. We tend to, you know, because we say, well, what is it? Well, state capture. But state capture is kind of private companies overtaking the state here. These are cartels organized crime, whatever, drug trafficking organizations that have kind of emerged from the state, gone off and done their own thing and then attached themselves to the state. Again, I'm not sure that we have. I mean, I've. I now search around in the works of criminologists to try and work out. But it's interesting how to make political science and criminology don't actually talk to each other very much. Really have the kind of. Yeah. Language to just to describe what's great, you know. Yes. So some people use.

Professor Benjamin Smith: So this is very vague terminology. People talk about the gray area between organized crime and the state. Well, that doesn't really describe. Describes everything. I mean, there's another one. I've got this here. What's his name? Alfred McCoy, who talks about. Oh, he's got another car. Sorry, I can't remember the term offhand, but there are these various terms to describe, you know, where the authorities and the, and the different agreements between organized crime and the state. But.

Richard McColl: So if we would look back at the political situation in Mexico that leads up to this. And you've been talking about how really it's the same names, a lot of the same families interrelated in these areas. But how did we get to a point like this? And I mean, I want to kind of point at Peña Nieto. I know it comes from way before this, but this kingpin list that he had the idea that it was going to eradicate the problems by this kingpin list. And the target number was largely ineffective, I would say exploded into Even broader situation of turf wars, a fragmentation of those cartels and they became more diffuse, smaller cartels. Perhaps you could give us a bit of background on that. And then leading up through Amlo Lopez Obrador and of course looking at Sheinbaum.

Professor Benjamin Smith: Yeah, certainly. So I think, I mean there was no doubt a kind of agreement between the federal government, broadly, not necessarily the president, but members of the federal government, normally through the federal police, the version of the FBI and the drug traffickers. And it goes back I think probably to the 1970s. However, that seemed to break down during the early 2000s. And then a president called Felipe Calderón came to power in 2006. He had a. He only beat Amlo by about half a percent. And it looks like he kind of launched a war on drugs to a certain extent to kind of gain credibility, having just won the election in very dubious circumstances actually. So he starts this war and you're absolutely right, it creates havoc. Murder rate goes way up.

Professor Benjamin Smith: I mean the murder rate in Mexico, unlike actually really low in the early 2000s and late 90s, had a kind of murder rate similar to the U.S. it's not very far off. This suddenly goes up and you're absolutely right. Then a president called Peña Nieto comes in charge. He's from the old PRI party which has controlled Mexico from 1929 to 2000. He promised to bring stability and he appears on the front of kind of Time magazine and there's. He's a kind of photogenic, empty headed photogen would have been very good at a soap opera style like his wife, less so as a politician. And it's saving Mexico. He's gonna save Mexico. And for about a year, no doubt, murder rates do actually go down.

Professor Benjamin Smith: And it does appear that his plan is basically to try and re establish the relationship between the federal authorities and the drug traffickers trying to tampen everything down. However, basically really bad goes wrong. He captures Chapo and then Chapo escapes. And at that point there's an enormous pressure on him not only to clamp down on Chapo, this is a humiliation for Mexico and particularly the United States, but also to clamp down on all other kingpins. So this is when from about 2015 to 2018, he really goes after the kingpins and he has this list. You're right. I think it's 122 people on the list. 110 Of them are arrested or killed. I mean it is. And it completely fragments the drug trade, as you rightly say, partially because these larger organizations fragment.

Professor Benjamin Smith: They Fight between themselves also, because to take these people down, you've had to have informants inside these people. You've had to turn people against their former allies. So. And no one trusts each other anymore. So now you go from kind of in 2000 and tens, maybe a dozen or so organized crime organizations. You're now talking maybe 20 larger ones and then 400 separate, very localized gangs, which occasionally ally with the larger ones if there's a shipment of fentanyl coming through, and occasionally fight them if they think they can make more money by nicking the stuff. So, I mean, and this. Yeah, I mean, it's really. And it's also. What that also did is really spread these organizations out. They simply didn't. I mean, one thing is really notable. They didn't. They weren't in, for example, Quintana Roo, Cancun coast, where you go on holiday.

Professor Benjamin Smith: They weren't in Chiapas. They weren't in Oaxaca. Right. Where my wife comes from. They were mostly in the northwest and a bit in the northeast, and then a little bit in kind of Michoacán and Guerrero, where they grew the poppies. That was about it. Now they're everywhere.

Richard McColl: And of course, the organized crime, when we look at this, it extends well beyond the fentanyl, the poppies, the transshipment of cocaine. It's into, like, everything. It encompasses kidnapping, extortion, illegal tapping of oil pipelines. I even want to say the totoaba fish trade. I want to say it connects everything. Everything illicit is connected.

Professor Benjamin Smith: Everything else. And a lot lists it. I mean, I think this is what. There's an extraordinary couple of surveys done by a group called México Evalúa. And they went up to Tijuana and went to Quintana Roo and basically did surveys of extortion. And they found that everyone below the large international corporations who either have amazing amounts of private security or have probably made a deal with the government who have links to organized crime to not get extorted. Everyone else kind of middle class below gets extorted. Taco stand owners, people who own, you know, a load of nixtamal mills or, you know, bakeries around the town, they're all paying. Now, that's from Tijuana in the northwest to Quintana Roo in the southeast. So this kind of extortion, it's almost a parallel tax system. For this is where we get into kind of parallel states.

Professor Benjamin Smith: It's almost a kind of parallel tax system. So it's really extraordinary. I mean, you know, and these people, they also, I mean, during the COVID we saw pictures of them giving out, handing out supplies to people, just like the state should. Right. So they were, they were basically funding this partly through a kind of broadly a taxation system. I mean, there's some extraordinary stories which I know a mutual friend of ours, Ioan Grillo, has dealt with, about if you look at the price, for example, of chickens in Mexico, how much is it, how much a pound of chicken costs? Well, it's about 30% more because the cartels where the chickens are produced put 30% on the people who farm the chickens. So everyone pays now a mafia price, 30% extra on their chickens. So it is really extraordinary.

Professor Benjamin Smith: It's not all the country that has to be made very clear. Some places the authorities are more in league with the organized crime than others. But most of them have to come to some agreement.

Richard McColl: Of course, the way of staying alive is coming to some agreement. We see this all over with organized crime. Can we point at Peña Nietos then, that his policies were particularly damaging for Mexico at this time? Or was it just a general evolution into a violence that we could have predicted?

Professor Benjamin Smith: It's difficult, isn't it? I mean, people kind of look back. I teach a course on kind of the history of the drug trade, and we kind of finish with something on mass incarceration in the United States. And there are people who look back to kind of a Jim Crow era where the prison is effectively used as a substitute for slavery. And then there are people who go, no, it's Nixon who launched a pros of your on drugs. But then you worked with the kind of. Nixon actually didn't put many Americans in prison. Let's face it, heroin addicts were white and came back from Vietnam. So he actually had quite good methadone system for them.

Professor Benjamin Smith: So now the people look at Reagan and then other people look at Clinton and say, well, Clinton could have done something, but he just put way more people than Reagan. Right, so. And I think that's kind of similar to Mexico. I mean, yes, Peña Nieto clearly doused the flames with a lot of petrol, but those flames were pretty high already. I mean, you could. Felipe Calderón, who launched this war, you could look particularly at Carlos Salinas, who he did firm up the relationship between the federal state and the cartels. I mean, it's. I mean, you know, his brother, Raúl Salinas, who just got out of jail a couple of years ago, and he was, I think I can say this on here without risk of being sued.

Professor Benjamin Smith: He's a little Bit litigious, but I mean, he was accused by many people of basically being in charge of taking payments from the drug cartels. And I've spoken to people who appear the DEA was tapping his phone and they have him talking to the major drug traffickers. That's the president's brother.

Richard McColl: I don't doubt it. Again, with this such this, I would say this interconnected nature of the business and the way the politics has to work and the funds, the economy that is driven by it. Obviously I'm located here in Colombia, so I'm seeing many things of a similar note that you're talking about. But if we move on from Peña Nieto and we head to Amlo Lopez Obrador, this podcast is brought to you by Latin News, the leading source of political and economic news and analysis on Latin America and the Caribbean since 1967. Access Latin News full portfolio of [email protected]. Well, what I mean, I think it's best that you give us an overview again of the evolution of the situation.

Professor Benjamin Smith: Right. So we haven't really, in actual fact, I was looking actually before this for some articles which gave a kind of overview of his security policy. And in actual fact, as far as I can make it, there doesn't seem to be one kind of overall article that's my kind of call me to the New Yorker if they're listening other than no. But I mean, so he comes to power with his kind of detour, his saying, his motto which was abrazos, no balazos, right? Hugs not bullets. It's like kind of David Cameron hugger hoodie kind of era stuff. So I'm going to, I'm not going to kind of clamp down in this way that Peña Nieto did on the cartels and particularly on the kind of low level street thugs, right?

Professor Benjamin Smith: They need an education, they need better wages, they need to get fed, they need better parenting. And he's quite a kind of traditional person in that way. So what he has done on that side, and I think this can't be denied, is that he has brought thousands, millions out of poverty. I think it stands at somewhere like about 3,000 people a day left poverty during the AMLO regime. It really is quite impressive. The second thing he's done is if you have a, if you had a paid wage labor job and about 50 to 60% of Mexicans don't, they work in the informal economy. As you know from Colombia, if you have a wage labor job, your salary has increased quite Noticeably, Right. The third thing that he'd done is he's basically given pensions to old people.

Professor Benjamin Smith: Now the middle class in Mexico City don't care because frankly, it is a small amount, right? It's not very much. But it has radically changed the life of poor people in the provinces who no longer have to worry about their crippled 65 year old dad who's worked the fields all the time, because now he gets enough for rice and beans or tortillas and beans every week. That is a massive change. And his idea is that will gradually work. And I think there is some evidence that it is gradually working. I mean, I think there is some evidence of that. You look at kind of long term trends of homicides. It has gone down, it reached a couple of years ago and since then it has decreased and it has decreased in certain areas where the economy has got better.

Professor Benjamin Smith: So particularly Mexico City and where I think. I think the homicide risk being cut by something like 2/3. It really is. I mean, Mexico City is a very safe place now. Safe for the most US cities. Probably why it's full of US people. So there are success stories. Okay, what has gone wrong? He hasn't done the kingpin strategy at all. He's made it very clear that he has no interest in taking down kingpins. This was made really clear in 2019. They basically, the military capture one of Chapo's sons, a guy called Ovidio, and Ovidio's men go out into the streets. The story is they threatened to burn down the barracks with the soldiers families in there. And as a result, AMLO takes charge and says, no, release him.

Professor Benjamin Smith: We're not going to let loads of people die just for some guy giving him to the green, right? So he's really stood back from that. I think there's no doubt about that. Which is why this whole thing with Mayo and Chapo's son is so strange. It looks like the Americans were not involved. It looks like this was either Chapo son working alone or Chapo son working with somebody in the US administration, which is pretty dodgy if you've got US institutions kidnapping people out of Mexico anyway. So you've got the kingpin strategy. The third thing he's done is he's basically, and this is huge, which no one really covers as far as I can make out again in the United States. Certainly he got rid of the Federal police. Now the federal police were unbelievably corrupt.

Professor Benjamin Smith: The head of the Federal Police, Genaro García Luna, is in prison in New York, maybe I will join him. He took millions of dollars from the Sinaloa cartel. Every one of his predecessors did the same. The federal police were effectively the people who regulated. They were the link between the authority, the federal authorities, and the cartels. Right. So he said, we'll get rid of them. They're super corrupt. And instead we'll put the military in charge of security. As you can imagine, this is highly problematic because the military, however bad the federal police were, they did have some kind of police training. So the amount of people accused and busted for drug trafficking has gone way down because there is no federal police doing this. There's still local police, but a lot of them don't want anything to do with the drug trade.

Professor Benjamin Smith: They, they go. That's. It's, I mean, it's a federal crime. So they stand back. So, I mean, the military has, There is, we don't. Things that, again, I suspect is rather like Colombia is. It's also, it's also very difficult to know quite what the military is doing outside. I mean, in Mexico City, it's there, it's in uniforms. It looks very smart. It does allegedly makes Mexicans feel safe. There's a lot of trust in the military. So. However, in the countryside, who knows, it looks. AMLO has told them that unless things are getting totally out of control, stay in the barracks, don't interfere. We'll try and negotiate this kind of stuff out. I mean, clearly some of them are taking bribes still probably at a lower rate than the Federal Police, but, I mean, that is a very low bar. Yeah.

Richard McColl: This will only increase, I mean, over time, as the military settles into the positions and spaces or the vacuum left over by los federales or the Federal police, the military will no doubt again fill that gap. Was it Claudia Sheinbaum, as mayor of Mexico City, who was also approving the militarization of the security in Mexico City?

Professor Benjamin Smith: Yes, she approved it, but she did something. And this is, I mean, this is where if we're going to talk about what she's going to do, she has the whole militarization of Mexico to deal with. And I'm not sure I can read her on that at the moment. She's going along with amlo. I mean, she's going on with Amlo on everything. I mean, she kind of has to, because she's not in power yet. Whether she can lever him from power, lever him from influence, upturn some of his biggest projects, who knows? But where I think she has differed in terms of her morality was that, yes, she allowed a degree of militarization, but the real crucial key to her security policy was she brought in a guy called Omar García Harfuch, who is known as. I think he's known as like Batman.

Professor Benjamin Smith: I mean, he's like, he's a. He's a super cop, right? He comes from Jalisco. It's kind of the west side of. Of Mexico. Comes into Mexico City, makes a big show of these kind of modern policing techniques where he's basically going to use data analysis to focus police in certain areas. So they really binged it because you find out that basically most crime in the city takes presenting about, I don't know, like 5% of the street. So if you focus police there, crime actually really does go down. So he did loads of these things. There are rumors that he also basically took cartel members and organized crime members outside Mexico City, shot him in the head and stuck them in mass graves. I have no idea about that, but those are some rumors.

Professor Benjamin Smith: There were also other rumors that he really messed around with the homicide figures. So a lot of people seemed. There seem to be unknown causes, I think is the highest reason for people's deaths. I. They seem to have shifted murder to unknown causes in a lot of. The. Lot of the. The lists of. Of the dead. So there are arguments about that where I find it quite difficult to believe that he is some kind of revelatory super cop. Is his. And going back to history here, he is the grandson of one of the military people involved in the 1968 Tlatelolco massacre of students in Mexico City. Perhaps more worrying, he is the son of a guy called García Paniagua who was head of the secret service that worked hand in glove with the narcos to set up the first ever Mexican cartel.

Professor Benjamin Smith: I mean, I think that is well established. His half brother was a fairly major trafficker who got whacked in public in 2011. So this guy who Sheinbaum created into a kind of super cop is now going to be head of security in Mexico for the whole of Mexico. He's. He's. Yep. I. I suspect if. If he. I mean, every single head of security in Mexico over the last 30 years eventually has his comeuppance in some horrendous, embarrassing corruption scandal. I think to a certain extent, to be a good cop, you kind of have to make deals with some people, right. To get information at the very least. And I suspect he will also have his comeuppance. If not. I mean, he's incredibly popular. He's a Son of a. Son of a spy and a beautiful actress.

Professor Benjamin Smith: I mean, that's the Mexican dream. Right? I mean, so I wouldn't be surprised if the guy, if he doesn't, if he keeps his nose clean, doesn't go for president in the next.

Richard McColl: I was going to say, it sounds like if he can manage the next few years, and surely a, yes, a presidential run is on the cards.

Professor Benjamin Smith: Yeah, I always think it's. I mean, Mexico City is so much easier to organize than the rest of the country, though.

Richard McColl: Sure.

Professor Benjamin Smith: I think there's somewhat of an illusion that if you can manage the monster, if you're going to manage a city of 35 million, then you can manage the rest of the country. But that's just simply not the case. I mean, it's basically the other thing that I think made Mexico City so good is they put a lot of video technology. It kind of became like London. Right. I mean, it's just full of cameras everywhere. You can't do that in. Get aired. No, no.

Richard McColl: This is a fascinating situation where it looks like you've got a super cop who is immensely popular who will be right beside Sheinbaum, because obviously one of the major issues that any Mexican president, as is their total mandate, is that of security. Before anything. I would say security. So how will we look towards November 5 and the US elections and a potential Trump or a potential Harris victory? What can we see developing there? Because I think you can see that there will be a hat tip to a strongman, but from either side, I would say either Harris or if it's producing results, or let's say publicly permitted results, then either side would be favorable, but it could really shake up a relationship with the greater neighbor to the north.

Professor Benjamin Smith: Yeah, I mean, I think, I mean, there's, there are different issues here, obviously. So, okay, one of the first issue is if Trump comes to power, is he actually going to do what he says he's going to do? He just. If he does what he says he's going to do, and he's going to basically attempt to really block migration and also start to deport people, that not only is going to give. Create huge social chaos in the United States, it's also going to create huge social chaos south of the border. I mean, it's really going to be absolutely terrible, and that will destabilize huge amounts of things. I mean, the key issue is I do think that to a certain extent we get a slightly. I mean, you're absolutely right in saying that Amlo did have quite a bit a good relationship with Trump.

Professor Benjamin Smith: I think AMLO's Anglo's a smart political player and he knows how to kind of play that kind of sort of preing narcissist. Just be nice to him, right? I mean, pretend it doesn't seem hugely difficult, right. Especially if you. And, and the deal he made was really simple, was we will stop the Central American migrants and then just leave us alone. And that really was it. I mean, there are more people in detention than, and I think no one knows this in the us more people in detention, migrants in detention in Mexico than there are in the United States. I mean there's a huge, I mean if you don't know what the military done is stayed in the barracks except to catch migrants, right? And you've got these huge detention centers all through Mexico, which we don't know really what goes on in them.

Professor Benjamin Smith: Again, horrible rumors, some kind of stories coming out. Some NGOs are allowed in. Very briefly, was it 39 people burnt to death in the one in Ciudad Juárez about a year ago. Bloke hasn't been prosecuted, who clearly just left them locked in. Right. While that happened so effectively Mexico. So a lot of this stuff I think is Mexico's kind of been allowed to do what it wants, particularly in terms of security. Right. If you know Mexico, I mean, occasionally the DEA is clearly really, really dislikes amlo, right. But the D's only thing is drugs, right. So they don't like the fact that Amlo, he was famously photographed shaking the hand of Chapo's mother. He also there's a big New York Times story. New York Times story about him. Oh no.

Professor Benjamin Smith: Was it ProPublica story about him allegedly his campaign taking some money in 2006 in that story had been going around in DEA circles for four years. I mean it's been a lot have been made of it. It's basically some middleman in his election committee probably took some money. I mean, I'd be amazed anyone gets to president in Mexico or Colombia over the last 50 years hasn't taken some money that came from drugs, right? So I just don't think it's a really big thing. I mean it's not good, but it's just not particularly revelatory. So clearly the DEA hates amlo, but the rest of the US administration, particularly the State Department, goes, well, you're helping us with the migrant problem. And also if you do get people out of poverty, less Mexican migrants, I.

Richard McColl: Mean, this is it isn't it? We talk about taking the positives and almost looking the other way because there are so many multifaceted problems that lead into so many other different issues. In your expert opinion, do you feel a Harris presidency would tackle things differently?

Professor Benjamin Smith: I mean, I don't know. I don't know if many of us know. Right. I mean, one thing that, I mean, I probably would agree with Trump on is she's been pretty loose on actual any kind of policy. Right. And also it's something you find from, you know, being involved in British politics, a lot of don't believe anything any of them say. But in general, my assumption is she would basically take the Biden route, which is. Be rhetorically quite tough, basically continue, actually, and the Obama route, which is to be just as tough on migration and occasionally probably voice slightly stronger objections to things like, you can bring this up. The last thing that AMLO will do is he will introduce elections for the judiciary, for judges. Right.

Richard McColl: Yeah.

Professor Benjamin Smith: Clearly the Democrats think this is anti Democratic. I suspect that Harris who came to power would probably, maybe the ambassador would say something quite. This is quite a bad idea. My suspicion is that Trump wouldn't care, but I mean, they'd change things either way. Migrants.

Richard McColl: Yeah. And so if we took a look at this, the whole picture, we've talked about the politics, we've gone from Peña Nieto all the way up to Trump or Harris spanning the border and so on. How does this evolution of the actual sort of drugs, trade and market fit into this? All of the different, I would say, provisions coming from China, then the preparation in Mexico and then of course the poorest border. How do we see it? Because what we're looking at as we talk and as you talk and so knowledgeably on the subject, I just come back to this issue of. And you said 40 different groups in different areas of the country. This is a huge country. I think people forget how big Mexico is.

Richard McColl: And then of course, the fragmentation of everything from the different cartels, from the different families, from the different groups that are in authority, be it the military or be it the leftover, I don't know, federales, whomever they may be today, different politicians and so on. I just see this fragmentation. And then of course, money coming in from China through the production of fentanyl and then money from this. It's not going to be a fun few years for Sheinbaum.

Professor Benjamin Smith: No, it could be. It could be extremely difficult. I mean, one thing I will say is that I think rather like the crack epidemic, which basically Wiped out a generation. Partly to do with mass incarceration, but partly also just to do with crime involved with it. It looks like potentially. And we see in some places fentanyl use is starting to go down. Overdoses are starting to go down now. I think it's. I think they went down last year. I think they went down from like 100,000 to 78,000, which is still ridiculously large amounts. But they do look on the way down, particularly. So if you look at the States, places like Virginia, where the fentanyl epidemic kind of started in kind of 2015, those places seem to have had a decline.

Professor Benjamin Smith: So it is possible that as fentanyl use goes down, that this does kind of get the. Get off the news and that there is some kind of. Kind of adjustment there. But the other thing that I would say that maybe she does have to her advantage is her party. Morena now runs most of the states, all the states. So, I mean, this does give her a degree of control. So, yes, there are warring politicians. I mean, her party, like the old pri, is an amalgam of different factions. But she does have some control over this. So I think that probably also will help her. One thing, that one thing I'd like to bring up, that I think no one is really talking about either in Mexico or the United States, is a lot of the drugs that Mexico makes now stays in Mexico.

Professor Benjamin Smith: Now, that was not the case 20 years before. 20 Years before, when I first came down to Mexico, I mean, there was a bit of weeds, you know, for tourists and elite hippies in Mexico City, but it really wasn't. You know, the most popular drug in Mexico at that point was paint thinner. Right. I mean, really rough stuff. Now there is. There are more people in rehab for meth than there are for marijuana. I mean, meth has really taken off and things like fentanyl has really taken up. On the northern border, there's a really interesting mayor of Mexicali, which is right on the California border. And he was going, everyone just. People seem to be dying here. We don't really know why.

Professor Benjamin Smith: So he just, he made the autopsy people do tests on all the dead people and found out that 20% had lethal levels of fentanyl in their blood.

Richard McColl: So Mexico is a consumer country then? I mean, rather than a transshipment country.

Professor Benjamin Smith: Yeah, not dissimilar to Brazil. I mean, we now know, doesn't it is Brazil, the highest per capita use of cocaine is number two.

Richard McColl: You saw that. I mean, totally anecdotally on the side when they dissected the sharks in the Bay of Niterói and Copacabana. They found them to have traces of cocaine because of all the urine that's been emptied into the bay by the users. So I would have always suspected that Mexico had a drug use, I mean custom issue, but I would not have expected it to have been properly, you could consider a consumer country. So this is something that will have to be addressed in this administration.

Professor Benjamin Smith: Yes, it will. I mean there have been some really interesting pilot projects that are being used all over the country and when you get down to the kind of local level, there's some really extraordinary stuff being done. Say I've got a couple of friends who work in the kind of drug rehab business with the health department also with the OAS which has done some really interesting pilot projects. But these are as I say, they're pilots, they're isolated. And I mean there are some also very. I mean it also looks that again this is one of the wonderful mixed up things about Latin America. A lot of the cartels actually run the kind of low level rehab centers basically to get their gunmen off the drug. You don't want gunmen running around addicted.

Richard McColl: To me, honestly, I'm not surprised in the slightest of that, but I would. We have to finish up here, Ben and I want to ask this final sort of top line question at the end is do you have any predictions then for this for the next few years regarding Mexico security and the drugs trade?

Professor Benjamin Smith: Keep an eye on García Harfuch, the head of security. I think his role will be extremely interesting. I do wonder if he is being going to be used as a stalking horse for her to recreate some kind of new federal police and try to take that role over from the military. Because I don't think you can present yourself as a stable democracy with your military running your federal cops. I'm trying to think of places where that happens and you need some kind of federal policing authority that's going to. I can see that happening in the future. That will be a kind of change. And also I suppose, yeah, keep an eye out for Mexico being the next Brazil in terms of a kind of drug addiction crisis. That's a very depressing prediction. Particularly if they start to deport people back.

Richard McColl: Yeah, definitely. But I can I. It does make perfect sense if based on obviously your research and the data available. It does make perfect sense. And if you're talking to people on the ground in pilot projects, well they are there, there's nothing like boots on the ground to give you the real picture.

Professor Benjamin Smith: You also talk about the, you know, you talk to the people who run the small gangs and they have no links to, they can't get the drugs out. They have no one. They, I mean, they might have a cousin in like, New York, but they can't get the stuff through Tijuana, so they're just gonna flog it on the street in the, in their tiny town in Hidalgo.

Richard McColl: Yeah, that makes sense. It makes total sense. It's an unfortunate and depressing comment to finish on, but we have covered some. There are positives in here in this last 40 minutes. There are positives. Let me just say. Well, thank you so much for your time. We really have been privy to a fantastic conversation about a lot of the great complexities of what Mexico and President Sheinbaum have to face and of course, how they got to this place right now. And of course, we'll be watching for further developments in the El Mayo Los Chapitos, in this friction, let's say, this conflict between the two. I've been speaking to Benjamin Smith, the professor of Latin American history at the University of Warwick, also the author of The Dope: The Real History of the Mexican Drug Trade. It has been a real pleasure.

Richard McColl: Thank you so much for your time.

Professor Benjamin Smith: Cheers, Richard, that was a delight. Thank you.

Richard McColl: It's been an absolute pleasure. I've been talking to Benjamin Smith as well. This is The LatinNews Podcast based out of Bogotá. Here I've been your host, Richard McColl. Be sure to tune in again in a fortnight's time where we'll be talking about more issues from the region of Latin America. Thank you again and goodbye.

Outro: You've been listening to The LatinNews Podcast. For more news and analysis on Latin America and the Caribbean, visit www.latinnews.com.

Dr. John Crabtree is a distinguished Research Associate at the Latin American Centre at the University of Oxford and a Senior Member of Saint Antony's College. With an MA from Liverpool University and a PhD from Oxford Brookes University, where he also serves as a visiting researcher, Dr. Crabtree is a leading expert on the politics of the Andean countries.

His extensive research and publications include notable works such as "Peru under Garcia: An Opportunity Lost," "Fujimori’s Peru: The Political Economy," and "Business Power and the State in the Central Andes: Bolivia, Ecuador, and Peru in Comparison," published by the University of Pittsburgh Press. Dr. Crabtree also holds the position of Region Head for Latin America at Oxford Analytica Ltd., bringing deep insights into Latin American political dynamics.

Intro: Welcome to The LatinNews Podcast, a fortnightly deep dive into key developments from across Latin America and the Caribbean. Here's your host from Bogotá, Colombia, journalist Richard McColl.

Richard McColl: This is The LatinNews Podcast. I am Richard McColl, your host here in Bogotá, Colombia. This week's subject is very pressing. Right now we're looking at Bolivia. Esteemed guest is Dr. John Crabtree. He is well, he's at the Oxford School of Global and Area Studies. He's an associate there, Latin American Centre. He specializes in the politics of the Andean region and is an associate of the politics department at Oxford Brookes University and region head for Latin America at Oxford Analytica. Also the author of the recent book Business Power and the State in the Central Andes, published by the University of Pittsburgh Press. Welcome on The LatinNews Podcast.

Dr John Crabtree: Thank you very much.

Richard McColl: We have a lot to talk about. There's a lot going on in Bolivia. It may not make the front pages of the international press, but there's a lot going on. And I think we should start by saying let's look forward to the elections in 2025. There's a whole lot of uncertainty on the ground with the divisions in the MAS, the Movimiento al Socialismo, Evo Morales and current President Luis Arce. Perhaps you could give us some background.

Dr John Crabtree: Yes. Well, the elections take place. The first round of elections will take place or scheduled to take place in just under a year's time in August of 2025, with a second probably with an almost certain second round in the October of 2025, followed by a new president or perhaps an old president who knows, taking place in January of 2026. So that's the sort of scheduled timetable for them. But before that, there's going election on December 1st. Well, actually two sets of elections on December 1st, which is putting quite a lot of strain on the electoral system, one of which is questions to elect new heads of the new judicial authorities, which has been a very contentious issue, which has been running and running for the last year or so.

Dr John Crabtree: And the other is the referendum which has been announced by President Arce in his Independence Day speech on 6 August on a number of originally on three issues, now really boiling down to two issues. But we can perhaps talk more in more detail about that. It has been agreed, because of the degree of electoral congestion, shall we say, that none of the parties are actually going to hold elections for party primaries to secure their candidates for the presidential election, which also is a complicating factor.

Richard McColl: And I've seen commentary out there that the referendum December 1st in addition to the judicial elections on December 1st. But the referendum is an attempt, do we think it's an attempt by the current government to find a solution to the critical situation in Bolivia, the economy and so on, and the lack of US dollar funds, but also to distract and divert attention from the possibility of even more massive social mobilizations taking place?

Dr John Crabtree: I think it's essentially an attempt to buy time on the part of Luis Arce. I think that each of the questions that were posed are full of complications, much of which depend on the actual wording of the questions. The original wording has been sent back to the President's office saying that the wording was biased and complicated and impossible to understand on the part of ordinary electors. So he's going to have to come up with a set of slightly different questions.

Dr John Crabtree: But basically one of the issues as a result of that, one of the topics for the referendum has been dropped, which had to do with the numbers of deputies each party would have per department in the country, which depended on the outcome of the census, which is out in a few days time, or at least scheduled to be out in a few days time. So that's been dropped or put aside for the time being. And the other two questions are to do with whether or not people are happy with the idea of subsidies being dropped on fuel, on diesel and imported petroleum, which is a bit like sort of asking turkeys to vote for Christmas.

Dr John Crabtree: Because I mean, the last time they tried to get rid of subsidies, which was done by Evo Morales back in 2011, it produced complete mayhem and Evo was forced to backtrack almost immediately. So I mean, any increase, any removal of subsidies would immediately impact on people's economy in terms of travel and fuel for cooking and what have you. And the other issue is the question of whether or not EVO should be excluded from standing. And this again is a complicated saga which began with a very controversial ruling by the Constitutional Tribunal a year or so, no, a bit less than a year or so ago, which said interpreted the Constitution in such a way that EVO would be barred from standing.

Dr John Crabtree: This was whether or not having been re elected once, a candidate can stand again ever, or just has to leave a period of term of five years before doing so. And I mean, this is highly controversial in as much as the 2009 Constitution says nothing about the inability of somebody to return to be a candidate after a period of five years has elapsed. So this asking people to vote for this is going to be highly controversial. I mean, it's difficult I think to predict what the outcome of such a vote would be. But I think there'd be quite a lot of sympathy for Evo Morales as being a victim of being hounded by the President and the current authorities. So those are the three questions, or at least the two questions which will be put to voters.

Dr John Crabtree: And it's not in my mind at all clear how they will end up responding.

Richard McColl: I mean, obviously, as you said, Evo Morales will have a sympathetic base, he will have a large following. Where did the falling out begin? Between. I mean, they were great friends, right? Luis Arce and Evo Morales.

Dr John Crabtree: Luis Arce was the finance minister from 2006 to most of the time between the whole time Evo was in office. So yes, they worked very closely together. And it was because Evo couldn't actually contest the elections in 2020 that Arce was brought in as a sort of surrogate candidate. Arce is essentially a technocrat. I mean, he's not somebody with great political appeal in a sense. I mean, he comes across rather dry, rather academic, doesn't have the tub thumping style that Evo Morales has. But increasingly he has sought to distance himself from Morales. And this began really when he took office in 2020 and appointed people around him as ministers who clearly distant from the previous generation of leaders. And I think this was the origin of the rumpus between them.

Dr John Crabtree: And increasingly there's been no meeting of minds in terms of who should be the MAS candidate for the 2025 elections. And as the thing has got deepened, it's become not just a personal dispute, but actually the MAS has been ripped apart in terms of its social support. I mean, it's fair to say, I think that Evo maintains a strong rooting within the country's social movements, but quite a lot of the social movements also have sided with Luis Arce over recent. In the last couple of years. And this reflects to a certain extent a sort of geographical divide between Morales base in Cochabamba and Arce's base on the Altiplano. And this goes back to. These are sort of regional disputes which have a long history in Bolivia. So I mean, I think that there's certainly no.

Dr John Crabtree: I mean, as the days go by, the thing gets more and more aggressive. And I've just been reading the papers for today and it suggests that the Evistas are suggesting that if they are barred from Evo standing, all hell's going to break loose and that they're going on the rampage. Who knows? I mean, these may not be just Idle threats either, because it's true that Evo has a very strong standing in particular in the Tropic of Cochabamba, but also in other parts of the country as well. I think what happened is the social movements have become themselves have become split, with the hierarchies of some of them siding with Arce, but also with the others siding with Morales. And this is of course creating problems for the electoral authorities as to who they recognize as the candidate of the MAS.

Dr John Crabtree: And this again is something that's as yet unresolved but has to resolve itself in the next couple of weeks. It sounds quite how it's going to resolve itself.

Richard McColl: It sounds incredibly complex. A situation where you're going to get the Tribunal Supremo Electoral all interpreting and depending on who's in place and how they interpret. And this suspension of primaries, I realize there's not enough time for suspension of primaries, but it also feels like it's a way of smothering Evo Morales candidacy.

Dr John Crabtree: I think so. I think so. I think that's the idea. But I mean, whether or not they will succeed in that. I mean, I think that the, you know, one of the problems of the fact that they haven't been able to. To elect new judicial authorities is that the current judicial authorities, which include the Tribunal Constitutional, have tended to side more with Arce and with. With Morales. And I think that's certainly the case in terms of the leadership of the Electoral Court.

Richard McColl: So when are we looking at the first round of.

Dr John Crabtree: I mean, Morales is threatening to have an assembly to elect new directorate of the party in the coming week. And the electoral authorities say they won't recognize it.

Richard McColl: Yes, because it will be outside of the official, let's say, format.

Dr John Crabtree: It will be entirely the president of the party, Morales. But the leaders of the rest of the directorate are on the Arce side. So it's very, it's not clear for them at all.

Richard McColl: And as I was saying, when is the first round of the elections? When are we expecting that to take place?

Dr John Crabtree: It'll take place in August next year and then the second round In October.

Richard McColl: In October. And so as it falls, right now we're looking at Luis Arce and Evo Morales. The split in the MAS. Is there a possibility that Evo Morales creates his own political party, a new one?

Dr John Crabtree: It could be. I mean, but he'll have to do it pretty quickly, I think, because the timetable is running out. Unless the timetable is. I mean, as often happens in Bolivia, unless the timetable slips that could happen.

Richard McColl: And what other candidates are emerging across the political spectrum right now for the elections?

Dr John Crabtree: Well, so far as the opposition is concerned, I mean, there are two main parties. One is Comunidad Ciudadana, which is the party of Carlos Mesa, the former president, Carlos Mesa, which itself is subject to a certain amount of internal division. So one presumes that Mesa will end up being the candidate of that. But, I mean, he's very much an old, you know, a figure from the past. I mean, he was president in 2005, which is now quite a long time ago. And he's, you know, then he seemed quite old. So, I mean, he hasn't got any younger as the years have gone by. And then there's Luis Fernando Camacho, who is currently in jail for his role in the coup that ousted Morales in 2019.

Dr John Crabtree: Now, the leadership, the political leadership of his grouping has shifted a bit towards new leaders emerging in Santa Cruz. I mean, it's not very clear who would be the candidate. There are a number of cruceños who are sort of pushing themselves forward. The rector of the university in Santa Cruz is one such person who could possibly be emerge. But none of them, I mean, even in Santa Cruz, these are parties which have the support of quite a lot of the urban population, but a lot of the rural population have traditionally voted for the MAS because a lot of them are migrants from the altiplano, which is where the MAS has always been strongest. So really, both parties, as they stand, have substantial divisions. So it's quite. How they're going to resolve these without primaries again is not very clear.

Dr John Crabtree: Now, I'm sorry if I'm not clarifying the situation for you, but this is typical of Bolivian politics. The lack of clarity is part of.

Richard McColl: The game, lack of clarity.

Dr John Crabtree: So I don't think, I mean, you know, on their own, these parts, these are parties which are not. I mean, the question is whether or not a third candidate, a third force might emerge. And the mayor of Cochabamba city has been voiced as being Manfred Reyes Villa has been voiced as a possible candidate. He's not disavowed that possibility. He's sitting and waiting. I think other people might emerge, but it's not very clear who they are. Before an election, you need to have a bit of sort of, you know, you need to campaign a bit, and time is ticking by.

Richard McColl: It's, I mean, in. In any ordinary circumstance, and Bolivia is far from the ordinary, and you would expect or hope that in, again, in a stable democracy, an opposition candidate will come Forward and take will be able to unite opposition parties to defeat the divided party of the MAS of Evo Morales and Luis Arce. But it doesn't even look like that is a possibility.

Dr John Crabtree: The victories of the MAS in 2005, 2009, 2014, and again in 2020 all saw the opposition going divided. Lessons are not learned. But of course there are egos involved in all of this, and there are different projects involved in all of this. So it's difficult sometimes to put these things together in a candidacy that has some sort of degree of credibility.

Richard McColl: I'm curious on this level. I'm curious. Anyone who gets in, let's say, takes office in January 2026 is going to have a. Either a tiny legislative majority or none whatsoever.

Dr John Crabtree: Yes, and that's been the problem for Arce over the last two years, is that the deputies who support Evo Morales have acted as an opposition, have moved over to actually making common cause with their arch enemies on the right, who you thought they may be, but basically, as sort of the enemy of your enemy is your friend. It's the kind of logic of it. And what one's likely to see is a highly fragmented Congress into different groups, which will make governance governing very difficult, which is of course, a pattern one sees in many countries of Latin America these days.

Richard McColl: It's a pattern that repeats, as you say, it's a repeating pattern.

Dr John Crabtree: And Bolivia, even in Colombia.

Richard McColl: Well, yes, of course, Bolivia. And so we can expect, unfortunately, we can expect mass mobilizations, we can expect the highways, the few of them that there are, to be blockaded and so on.

Dr John Crabtree: That is the force of the MAS. That is the force that Evo Morales has at his disposal to create problems. I mean, for sure, Bolivia is a very easy country to bring the economy to its heels by simply blocking a few roads. I mean, the communications in the country are fairly rudimentary in terms of the number of roads between the main cities and the fact that the main route between Santa Cruz and La Paz, or Santa Cruz and anywhere else pretty much goes through the Chapare, which is ever Morales's bastion, is a problem. It always has been a problem, but it's always not just there either. So, I mean, I think there will be problems.

Richard McColl: It worries me, and of course, I think it worries everybody. There's this economic morass in which Bolivia finds itself and a degree of quite a deep degree of political limbo. And you mentioned bringing the economy to its knees, but it already is at its knees. How much further can it fall?

Dr John Crabtree: Well, I mean, up to now, I mean, Bolivia has been reasonably successful. I mean, until last year it maintained a low inflation rate and a reasonable rate of growth. I mean, certainly higher than some other countries in South America. That looks, it's no longer the case. I mean, I think serious problems have emerged and there are two major factors here, I think. One is the collapse of export income from natural gas. This declined massively last year. I mean it was. The figures are in 2014, Bolivia was getting about $6 billion from exports of natural gas to Argentina and Brazil. That went down last year to $2 billion. I mean that's a big drop and it's a big drop on the figure from 2023 too. And this is causing difficulties in terms of foreign exchange. The other major problem amongst many problems.

Dr John Crabtree: But now the major problem is the system of subsidies to fuel which is incredibly expensive and means importing large amounts of diesel and petrol, much of it which goes towards fueling the economy of Santa Cruz, which is highly diesel dependent, which of course you can't not do that because you'll get immediate protests from Santa Cruz if you do that. So it's always proved difficult to get rid of these subsidies. The government is saying we must do this. And this is like I say, one of the questions in the referendum and I was just looking at the question that was actually being posed by the government and it was couched in such a way to say, well, this is a system, it's causing huge damage to the economy, huge damage to every Bolivian. Do you want it to continue?

Dr John Crabtree: And the electoral authorities say no, that's not a balanced question. So it's something which, as I said, it's difficult to think that people will vote for its removal. And so it's not really the whole referendum thing is not really a ticket to resolving that problem. But if they were to resolve that problem by sort of by diktat, then again all hell will break loose. It will be very contentious. And then Arce does not want that to happen between now and the beginning of January of 2026. I mean, probably want to leave that to whoever is his successor. So those are the two crucial issues and they are major issues in terms of government revenues because a large amount of the government revenue comes from tax on gas exports and a large amount of government spending goes on subsidy.

Dr John Crabtree: So the government is scrabbling around and the fiscal deficit is going up as we talk. And of course it's also a major problem in the balance of payments. And one of the things which one's seen over the last year or so is the disappearance of dollars. As the foreign reserves of the central bank declined and been declining steadily from the middle of the last five, six years or so, they're now pretty much at rock bottom. So that's produced dollar shortages, which means that people can't access dollars, which means again, that the machinery of the economy begins to grind to a halt because people can't buy the insumos from abroad, which they need to produce stuff. So that's another problem.

Dr John Crabtree: And the latest figure which was released the other day was that GDP in the first quarter of this year had grown by about 1.3%, which is very low compared with recent years. But it's going to be certainly a lot lower, I suspect, in the second, third and fourth quarters of this year. So, I mean, it's not a problem. The problem is one of the problems the government has is that it has not got the means, political or otherwise, to resolve these problems. And it basically ends up doing nothing, just letting time tick by, which is not good policy.

LatinNews: This podcast is brought to you by LatinNews, the leading source of political and economic news and analysis on Latin America and the Caribbean since 1967. Access LatinNews full portfolio of reports at www.latinnews.com.

Richard McColl: And I think you've mentioned several things here, especially in particular natural gas exportations. But let's move on to lithium. We know that Bolivia is a key player. And this lithium triangle down here in this part of the world, how is this progressing? Because you look at figures and it's actually quite astounding how much lithium Bolivia has on that border, of course, with Argentina. And I realize that they have made trade deals with Russia, China, India. But for Bolivia, China really occupies the main strategic partner. How is this all developing right now under the Arce government?

Dr John Crabtree: Well, this was the great white hope for Bolivian economy, which began when the lithium became sought after in about 2008, 2009. Everybody hoped that this would be Bolivia's salvation because obviously natural gases, natural gas, a long people long been saying, is running out in terms of supply. So you're right. I mean, Bolivia has massive reserves of lithium. The latest estimate is 23 million tons of the stuff. I think according to the recent figures I've seen this compares with Argentina on about 17 million and Chile on about 9.3. So it's the world's largest stock of lithium.

Dr John Crabtree: Now, it's always proved very difficult to push ahead with the development of the lithium industry. And while Argentina and Chile have raced ahead, Bolivia has not. I mean this is partly to do with political problems and reluctance of companies to invest in Bolivia, whereas Chile and Argentina provide a more sort of stable environment for investment. It's also due to the fact that the Morales administration sought to adopt a quite well, two things really. One, it sought to keep it under national control and not cede too much power to multinationals from wherever and at the same time to try to go up the value chain and to produce. The idea was to produce lithium batteries in Bolivia. Now you may say this is rather fanciful idea.

Dr John Crabtree: Ultimately most people wanted to invest in lithium, simply preferred to ship the stuff to China and do the processing of it and turning it into batteries there. But you're right, I mean there was very little by way of Progress when in 2019 the Áñez government, which briefly took over from Morales, that sort of interrupted things and again it was slow to get going again when Arce became president. There have been two important, well, a number of important deals, potentially important at least, I mean, whether or not we'll come to whether or not this is the potential will be realized.

Dr John Crabtree: But of Chinese companies, the CBC consortium, which includes CATL, which is the world's foremost builder of lithium batteries, so people who know what they're doing and know a bit about the industry, to build two factories in the Salar de Uyuni, which is the main area, and the Coipasa salt band, which again is a smaller one, but it's also quite important. And then in June 2023, another Chinese company, CITIC Guoan, alongside a Russian company called Uranium One Group also put forward proposals. Now, not an awful lot has progressed since then. I mean, the idea was that on the basis of these investments that the Bolivia would be to ramp up production to, it was thought, about 100,000 tons of the stuff, which compares with the figure in production of 2022 of 635 tons. So I mean very big increase in terms of production.

Dr John Crabtree: But as far as one can see, and this is not an industry that's noted for its transparency, the indications are that not an awful lot has happened. There is, I was noting the other day that an agreement is going to be signed with the CITIC consortium in a couple of weeks time which will perhaps, if the deal, if the details of that business plan are published, we will get a better idea of where it's going and when it will start actually producing stuff. But up to now there's not an awful lot to say for it. And this is again, I mean the Arce government has taken a rather different angle on it in terms of its preference to realization that it has to work with multinational corporations and that Bolivian can't do this on its own.

Dr John Crabtree: It lacks the financial and technical wherewithal to steer an industry of this kind. But of course they have gone very much for not going for North American companies. They've gone for China and Russia, which again has a sort of ideological basis to it and which has of course been a source of a certain amount of annoyance in Washington.

Richard McColl: Well, this is not unusual. US involvement, let's say, in Bolivia is historic. And it's mainly been around the alleged confrontation of narco trafficking, perhaps masking the.

Dr John Crabtree: Interest of the origins of mass.

Richard McColl: Yeah, marking the interest the war against.

Dr John Crabtree: Drugs gave rise to the MAS.

Richard McColl: Yeah, so we're not going to get the US in there right now. But I was reading about the CITIC consortium in the region of Potosí. When you think about Uyuni and Potosí, these regions, the local people are largely against this exploitation, I should imagine.

Dr John Crabtree: Well, there are different interests involved. One is the people who actually live around the Salar de Uyuni, who see economic benefits from this. I mean, it is an area where the poverty up to now has been absolute. So I mean people coming in and sort of wanting hotel accommodation and there are economic spin offs. So the people in Potosí, in the city of Potosí, basically the Civic Council of Potosí. And this goes again to another facet of Bolivian politics, which is its regionalism, which we haven't actually dealt with much. People have looked at Santa Cruz as being the battle between Santa Cruz and La Paz. But there's also other involvements and various departments want their share of the cake. And see management of all this by La Paz as to leading into a national pot from which they get very little by way of returning.

Dr John Crabtree: Which of course goes back to the question of the census, because the census is not only the basis for divvying up the seats in the assembly, but also provides the basis for the distribution of central government funding to the rest of the country, which has always been a contentious issue in Bolivian politics, not least between La Paz and Santa Cruz. Ever since the discovery of oil in Santa Cruz. And this has been a source of constant tension in the country. So yes, I mean, it's complicated.

Richard McColl: This sense speaking is quite exciting in that it could lead to, and I don't think it will lead to, but I imagine with the sort of the weight of knowing a population and its presence, it's almost like an electoral college. It's almost like saying, well, there's more People here, we need more representation. Could it possibly offer a concrete solution to some of Bolivia's issues?

Dr John Crabtree: Well, let's hope so. I mean, the census issue has been one of the. It's been a highly sensitive issue. The question of the holding of the census itself was a politically controversial issue with people from Santa Cruz, the civic committee in Santa Cruz in particular, jumping up and down, saying that the government in La Paz had been postponing the thing unduly. It should have been held two years ago, but because of COVID it couldn't be. And to give them their due, the government has made, you know, has gone about the census. It happened earlier this year. The results are to be come out in the next couple of few days, or at least should come out in the next couple of days. But it will lead to demands for greater representation in Santa Cruz because what you see in the last.

Dr John Crabtree: It's more than 10 years now. It's 12 years since the last census. And the degree of internal migration within Bolivia is very high as people migrate from the altiplano to a better life in Santa Cruz. So the population of Santa Cruz is going to be substantially higher than it was 12 years ago. But this raises the question of what you do with those parts of Bolivia, particularly those in the altiplano where the MAS is historically strongest. Are they going to accept less representation if Santa Cruz gets more? Or do you have to change the number of seats you've got, which is something that's specified in the constitution? Again, this is one of the issues that came up, one of the reasons why there was going to be this referendum, but it's now been dropped that part of it.

Richard McColl: If we look ahead to the potential outcomes of the election and thinking again, the great white hope, lithium, let's say ARCE wins. Could we suggest that the lithium market remains somewhat open to foreign investors? Morales, if he's allowed to run, we would suggest that there's a great uncertainty because he wants it to remain national. And if, let's say opposition or to the right, they manage to somehow pull themselves together behind one uniting candidate, we could expect sort of, let's say, more realistic liberalization of the market. But it seems again, the complexities here, it just goes on and on.

Dr John Crabtree: I mean, I should say that Jose has not actually put his hat into the ring officially yet. So I mean, he's been keeping part on that one. So I mean, he's not necessarily, you know, officially a candidate. So we don't. But I mean, the expectation is that he will be a candidate. I would think that both of them, both Arce and Morales come from the same school of thinking. I mean they're both sort of. And that the MAS is a nationalistic party in Bolivia. The nationalistic tradition is very rooted in Bolivia going Back to the 1952 revolution goes a long way back. So I think it's a big question if, I mean Arce has to a certain extent played his hand by inviting. Doing deals with the Chinese. It has to be said that Morales is a pragmatist as well.

Dr John Crabtree: I mean he's not, you know, when in office he did a deal with the Germans and then because there was a big rumpus over it and there was disagreements over it, he ripped up the disagreement shortly before he was deposed in 2019. It's not necessarily the case that he is completely averse to doing deals with foreign companies, but I think I can probably assure you that he would not want to do a deal with a company that's roots are in the United States. Even though of course we all know that most of these companies are. Where are their roots anyway?

Richard McColl: The unfortunate reality is I'm seeing great uncertainty, great instability, a huge amount of impartiality and a continuation of what we on the outside seem to think of Bolivia. I mean think of it. Since 1825 and its independence there have been 190 attempts. Are coup attempts or deposing attempts more or less the most recent being back in June of this year. Are there any possibilities of stability in the near future?

Dr John Crabtree: Well, it has to be said that next year is the 200th anniversary of Bolivian independence. So actually what happens on the 6th of August in 2025 has quite a lot of symbolic kind of importance. So yes, I mean I think that the. It's. This is the spirit of nationalism is. Is deeply rooted and is not going something that's likely to. To go away. So I, Yeah, I mean I think that's, that's, that's what you say is probably true.

Richard McColl: Sadly so. Sadly so. And, and is there any outcome that,.

Dr John Crabtree: You know, it's not. I mean it's difficult to. I mean nobody expected. I mean, you know there are things that unexpected about Bolivia in politics and. No unexpected. The emergence of the MAS. No one expected when Evo Morales took office that he was going to preside over a period of considerable stability. I mean, you know, it's the longest period of stability Bolivia's had since the beginning of its known. It became A Republican in 1825. And I mean these things, you know, surprises can happen.

Richard McColl: Well, that's a. Let's end now, John, perhaps, I mean,.

Dr John Crabtree: It might be worth just saying a little bit about Bolivia's relations with other parts of Latin America too because I mean, obviously what happens in Venezuela is not unimportant for Bolivia. And I think up to now at least, Arce has been fairly supportive of Maduro. I think they recognized Maduro's claimed election victory rather very quickly. I mean, obviously this is historic links which go back which has a degree of rootedness in sort of Latin American nationalism and common cause and so forth. Relations with Chile have always been testy, as you know, for the reasons of salida al mar. Relations with Peru are not that good. But one of the things that recently has happened that's been particularly negative for Bolivia has been the election of Milei in Argentina, but perhaps to asserting some counterbalance by the return of Lula in Brazil.

Dr John Crabtree: And there's a recent meeting between Arce and Lula. Lula came for a day with Arce in Santa Cruz and they were trying to stitch up, improve the possibility of Brazilian demand for Bolivian gas going forward. But both Argentina and Brazil have their own supplies of gas. So in the long term, Bolivia is dependent on two markets, both of which have their own sources of gas. And one of the problems, sad issues about natural gas as a commodity is that you tend to have to give it to the people at the end of the pipeline unless you can turn it into LNG.

Richard McColl: Well, one final thing then, John. If you were to give a top line summary of the coming year and a half in Bolivia, how would you phrase it?

Dr John Crabtree: Bumpy.

Richard McColl: Bumpy. As a one word,.

Dr John Crabtree: Bumpy and unpredictable.

Richard McColl: You've also used the word rumpus twice, so I think that's going to be rumpus as well.

Dr John Crabtree: Rumpus and bumpy.

Richard McColl: Yeah, Rumpus and bumpy. I don't know if I can title this episode Rumpus and Bumpy, but I'll find something equally appropriate. Let me take this moment to say thank you so much to Dr. John Crabtree. He's of the Oxford School of Global and Area Studies, Associate the Latin American Centre. He specializes in the politics of the Andean region. He's associate of Politics, the politics department at Oxford Brookes University and the region head for Latin America at Oxford Analytica. His most recent book is Business Power and the State in the Central Andes, published by the University of Pittsburgh Press. So let me say thank you so much for your insights into what seems to be well right now, pre-electoral instability, heading towards a year and a half of bumpiness.

Dr John Crabtree: Thank you for your questions.

Richard McColl: It's been a great pleasure. I've been Richard McColl here for The LatinNews Podcast based in Bogotá, Colombia. We'll be back in a fortnight's time discussing more issues from the region. It has been an absolute pleasure. Bye bye.

Outro: You've been listening to The LatinNews Podcast. For more news and analysis on Latin America and the Caribbean, visit www.LatinNews.

Andrew Thompson is a journalist and political risk analyst who covers Latin America.

He was previously a foreign correspondent in Mexico, Argentina and Brazil, and head of the BBC’s Latin American Service.

He is currently focusing on journalism, economic analysis and political risk on a number of projects with different organizations, including Oxford Business Group, EIU, LatinNews, and Canning House.

Intro: Welcome to The LatinNews Podcast, a fortnightly deep dive into key developments from across Latin America and the Caribbean. Here's your host from Bogotá, Colombia, journalist Richard McColl.

Richard McColl: This is The LatinNews Podcast. I'm Richard McColl, your host here in Bogotá, Colombia. This week I'm speaking to Latin American analyst Andrew Thompson. We're going to be discussing a new report he has authored entitled Sanctions in Latin America: The Regrettable Rise in the World of Prohibitions. So we're going to be talking all about these. Obviously, we have issues in Nicaragua, issues in Venezuela and Cuba, obviously a historical example there. But we. Well, let's let him jump right in. Andrew, welcome back on The LatinNews Podcast.

Andrew Thompson: Good to talk to you, Richard.

Richard McColl: It's an absolute pleasure. I read all 17 pages of the report. Fascinating report. And I think we just start with the basics. The aim of sanctions as we know them is that they're designed to force governments to defend business interests or restore or seek democracy, respect human rights, protect the environment, fight corruption and tackle international crime. We're on the right background there.

Andrew Thompson: Yes, we are. And perhaps I could say something that's not in the report, which I discovered later. You might want to ask me about the history of sanctions. I did a little bit of preparation and it turns out that the first known sanctions were applied in the year 432 BC before Christ, or before the Common Era, as it's called. And it was down to the Empire of Athens, who had some kind of a falling out with a city state to the northwest called Megara. And Athens said that there would be no products from Megara in any of its marketplaces until Megara sort of stood down and accepted the preeminence of the empire of the Athenians. So arguably, things haven't changed too much. They'll go forward to millennia. And sanctions still seem about one government telling another one, you can't do that.

Andrew Thompson: And I'm sanctioning you come around to my way of thinking.

Richard McColl: Quickly. And were the Athenians successful?

Andrew Thompson: I don't really know. I haven't read enough of it. But the implication was that they were and that the merchants of Megara had to knuckle down and make the concessions, join the empire, so to speak.

Richard McColl: Well, I mean, it's an interesting thing to fall back on because obviously we all have very different opinions on the nature of sanctions, whether they're successful or not. As you said, it's the state of one government imposing their will on another government. If we put this into. Obviously we need to put this into Latin American context. For this podcast, I kind of feel that we need to discuss the really Cuba as the first place jumping off because I mean these date back. I have the date, but I'm sure it's more fresh in your mind. When did sanctions begin on Cuba by the US?

Andrew Thompson: They began in 1962. So you have the victory of the Cuban Revolution in 1959. There's an initial period where there's a belief that Fidel Castro might be just as a left leaning Democrat and it turns out quite quickly that he is more committed to the Communist Party and to a Marxist approach. So in that process, during which we also have the Bay of Pigs invasion and if you like the US behaving in a fairly imperial manner as a result of that, what they initially did was there was a law already on the US Statute, which is the Trading with the Enemy Act of 1917, which was designed to allow the US to stop trading with opponents such as Germany in the First World War.

Andrew Thompson: So they wrote that and added on a new act and gave the US President the authority to ban all trade with Cuba. And hence began a period of six decades, or to be precise, 62 years during which the US has systematically applied the trade embargo. And in the eyes of many, it has been a total failure. Because six decades, this was typical, the US saying we don't like what Cuba's doing. We are going to apply pressure and force it to change its behavior. And you have the Cuban side saying we're not going to accept that. We're going to resist it every step of the way. And the two positions get, if you like, solidified, someone would say ossified and it becomes a permanent thing.

Andrew Thompson: Even though by any calculation it has failed, it hasn't really over the years changed control by the Cuban Communist Party. It hasn't turned Cuba into a more democratic country. So the question may be why keep on doing it? And there are a number of possible answers to that one, due to the fact that Cuban Americans and Hispanic conservative Hispanic Americans are a powerful electoral force in US politics. So any relaxation of the sanctions against Cuba goes down badly with important swing voters, of course.

Richard McColl: And as you said, the sanctions have not hastened the end of communist rule in Cuba. And of course Fidel Castro was able to double down, putting Raúl, his brother, in power and then Miguel Díaz-Canel as well. I mean, we're going to a proper, you know, there's no step towards a more democratic, let's say development or evolution there in Cuba. Would you say it's just an aggressive. You mentioned the word imperial, but an aggressive carrying out of the Roosevelt corollary of the Monroe Doctrine.

Andrew Thompson: Yes, I did mention the word imperial. And I think what we find in the world in general is that superpowers tend to think quite favorably about sanctions, partly because, well, there can be various reasons for it. But if you look at the three main sources of sanctions at the moment, they are the United Nations, the European Union and the United States. And the United States applies far more sanctions than anyone else. So if you actually count the number of sanctions, it turns out that the UN more or less sanctioning 30 countries, the European Union is around the same number, and the United States has around 12,000 sanctions. That's comprehensive sanctions applied to an entire country or targeted sanctions which are applied to individuals and entities that the US highlights.

Andrew Thompson: And I think somehow caught up in this is the willingness of a sanctioning country to be a little bit like one of the world's policemen. It feels it has to be the right to enforce these things. And I think that's kind of connected in the US case with what analysts are called US exceptionalism, which basically maintains that the same rules don't apply to everyone. If you are a superpower, you can apply special rules which other countries might want to apply but shouldn't. So it's kind of caught up in this idea of, I think of exceptionalism.

Richard McColl: You say this exceptionalism and the way this blanket, I would say all encompassing sanction on Cuba, it would have started out, we're looking, you said 1962 is the heart of the Cold War,.

Andrew Thompson: More.

Richard McColl: Of a security policy purpose. But over time this has evolved, really, isn't it? I would say it's more of a straight up punishing foreign policy.

Andrew Thompson: Yes. I think the interesting thing here is that you can argue it various ways. And one, if you like, disrespectful argument, is to suggest that there's a bit of George Orwell's 1984 going on here. It may be stepping out of line a bit, but there's an argument in that two rival countries at war with each other may be useful to solidify domestic rule and overcome objections. So one suggestion is that although he denounced it all his life, Fidel Castro might have survived longer than he otherwise would because of sanctions. Because everything goes wrong in Cuban society and there's quite a lot going wrong with the economy and so on. You can say, it's sanctions. The US caused it. The US is our enemy. You're worried that there's not enough food in the supermarkets, the cost of living, unemployment.

Andrew Thompson: It's not me, it's not the Communist Party of Cuba. It's Uncle Sam who's doing it. And that's, if you like. One of the really surprising things is that the Cuban trade embargo has simply gone on for more than a generation. And where in the world you find a policy that is more unsuccessful yet survives for so long? So there's one argument, I mean, it's true that different US Presidents have tried to calibrate sanctions. Notably under Barack Obama, there was a significant opening to Cuba reestablishment of diplomatic relations and a beginning of a relaxation of sanctions. There's an argument that had that continued, it might have been more subversive for a Cuban society which was looking to make changes than maintaining the sanctions.

Andrew Thompson: So I know that's a kind of Orwellian argument, but the idea is he had in 1984, Ministry of War and Ministry of Peace that were basically about indoctrinating the local population.

Richard McColl: Well, of course, I mean, when you have the universal figure of distrust or the hate figure, it's very easy or much more straightforward to consolidate power. You have in this report the troubling figure of the that this U.S. financial and trade embargo has cost Cuba over $130 billion in lost revenue. And of course, as I said earlier, it has not hastened the end of communist rule. Who has suffered? It's the people. I don't see anything changing.

Andrew Thompson: I think that is the case. The fact, the argument for sanctions is that they cause pain, mainly economic pain in the sanctioned country and force it to change its behavior. In the case of Cuba would be to hold democratic elections, relax the political situation, and so on. As far as I can see, based on the research I've done, that first bit, sanctions cause economic pain is true. Like if we're making an argument in various steps, being sanctioned is not good, it's bad for the economy. But the next step, therefore the government caves in is not. Doesn't follow logically at all. I've already suggested In fact, therefore government solidifies its position. And there is some academic work which suggests that when autocrats are sanctioned, they tend to become. They tend to increase the clampdown.

Andrew Thompson: So it's, I think we can say sanctions cause pain, but sanctions on their own do not force regime change. And that's kind of, you know, if you look back over Cold War onwards, it may be that in some cases they will help regime change. But I think that's only when a Lot of other things are going on. This is something that we may come back to, perhaps when we talk about Venezuela or other countries. Economic pain does not equal political liberalization. Economic pain plus other events which many people and countries can't control. Splits in the ruling party, unexpected problems in the economy, all sorts of surprises taken together, they could have, or they can have more of an effect.

Richard McColl: So when there was the civil unrest in Cuba, then that could have created a situation in which you said, well, it's been 60 years of sanctions and potentially this is easing us into a different era. But of course, it was cracked down so fast that we're back, I would say, to square one, because after the Barack Obama presidency, then you have Trump who comes in and immediately says, as president, Cuba is a state sponsor of terrorism and it sets it all back. And of course, under President Biden, there's been no lifting, as far as I know. And then we should probably address it right now under either a future President Harris or a future President Trump. Potentially Harris, should she win, would be a little more favorable towards Cuba.

Richard McColl: But again, we're just supposing here it's spitballing and Trump wouldn't change the position at all.

Andrew Thompson: I think that the first thought is that a renewed Trump presidency would lead to a renewed tightening of sanctions against Cuba. He's been known, not only in the Cuban case, but also Venezuela, of favoring what he called maximum pressure against these governments. So that might happen. On the other hand, it's also worth bearing in mind that typically during his first presidency, Trump just didn't really think about Latin America very much. He made some statements about Venezuela which were seemed to say nothing was off the table, including a military invasion. So there's an element of uncertainty with the Trump presidency how he would reconsider his position. If we have a Harris presidency, I think that, yes, there will be more a tendency and that traditionally there's a tendency among Democrat presidents to see if there can be some relaxation of sanctions against Cuba.

Andrew Thompson: But with Harris, as with other Democrat presidents, the important thing is Miami and Florida, such a significant electoral group of Cuban Americans that would take offense at any relaxation of policy. I'm not saying that Harris wouldn't favor an opening to Cuba. I'm just saying she would certainly be looking over her shoulder at what the electoral implications in the United States might be. Bearing in mind that there's already quite a lot of pressure on her relating to immigration. General feeling that Trump's wall, or certainly its his policy against immigration is quite popular electorally. For good or for bad. You know, even though the latest figures show that immigration across the US border has come down. So I think that we can't say with Harris there'd be a clear ditching of the sanctions policy.

Andrew Thompson: You'd probably, I think it's gone on for so long that you probably need some kind of bipartisan agreement, just as efforts to control migration to involve talks between the Democrats and the Republicans. I think on an issue as big as a Cuban embargo, you'd also need some kind of bipartisan agreement. And that would depend on how the elections go in November. We've got what share of the votes in the Senate and the House of Representatives. So it's, you know, to be confirmed, to be seen.

Richard McColl: And I, I don't see the usual suspects in the Republican Party, you know, freeing up any space for dialogue on that. Marco Rubio, Ted Cruz, I don't. But enough of them. There was something that came up in, earlier in the conversation when you talked about the places that place sanctions, the U.N. the U.S. and the EU. And an issue that popped up, and a piece of data that popped up in this report is that it seems that Latin America is disproportionately sanctioned. And you put in October 2021, there were 1,990 sanctions placed by the U.S. on Latin America and the Caribbean. And 1,897 of these, or 95% of them, are by the U.S. i find that it's quite overwhelming.

Richard McColl: But of course, the U.S. as you said, and you talked about sort of a global police force, and of course, we are sitting in their political, geographical, sphere of influence. But why so much? Why are we seen as a top priority here in Latin America and the Caribbean?

Andrew Thompson: I have to confess to a possible misinterpretation. Absolutely. The political consultancy that I was quoting, Castellum.AI, does say that there is, you know, that Latin America and the Caribbean disproportionately sanctioned, and they come with those numbers. However, when they say that, they aren't necessarily comparing like with like, because they're saying that Latin America is more sanctioned than Iran and North Korea, but those are countries. So we're comparing a region of Latin America with individual countries that are pretty high up, what you might call the US hostility list, Iran, Russia, Syria and countries at that time. So I think it's true up to a point that Latin America is singled out, if you like, among the reasons for that. I mean, obviously we've got the comprehensive sanctions that are applied against Cuba and Venezuela Slightly more targeted sanctions applied against Nicaragua.

Andrew Thompson: But one of the things that racks up the numbers in Latin America is the amount of people and entities, companies, so on, that are sanctioned because of their links to drug trafficking, which is a particularly strong, if you like, Latin American specialization for want of a better way of expressing it. So if you look at the same source, you look at the number of sanctions individual countries in Latin America, you get Colombia leading the field with 874 and those are mainly drug traffic related. And then followed by Mexico with 692 again drug trafficked, playing a particularly important role there and then other areas with less sanctions. Venezuela, comparatively speaking, has 245 targeted sanctions and a number of countries have very few.

Andrew Thompson: Brazil has 12, although Paraguay, where a former president is linked to alleged drug trafficking and other forms of crime, gets a total of 23 sanctions.

Richard McColl: Yeah, I would expect Paraguay to have had more. But peculiar there, it seems to fly under the radar. No surprises about Colombia at all. Obviously the number one coca producing country. I think the difference between the blanket sanctions for a country and of course the focused targeted sanctions on individuals. We referred many months ago to Nicaragua on this podcast as being a tropical Taliban. The targeted sanctions in Nicaragua, they are aimed at the Ortega family and then his cohort of allies. What can we portend from the sanctions there?

Andrew Thompson: Well, it's really interesting that having applied comprehensive sanctions against Cuba in 1962, comprehensive sanctions against Venezuela from about 2015 onwards, the US government has not applied them against Nicaragua and it's targeted Nicaragua for individual sanctions and entities. And what they seem to be doing there is targeting everyone who is close to the Ortega Murillo presidential couple, but not them, not the presidential couple themselves. Ministers, companies, state companies they've worked with. I think I said yes, there's around 250 sanctions in force. Very, very significantly. The US has also said it will use, or it is using its vote in a whole range of financial institutions, including the International Monetary Fund, the Inter-American Development Bank and others, to discourage lending to Nicaragua in a deliberate attempt to make the economic situation tougher and to encourage a political opening and eventually a return to free elections.

Andrew Thompson: But just as the case is with Cuba and Venezuela, there are little to no signs of progress in moving down that road. And I think it's worth mentioning here were talking earlier about, you know, do sanctions work? One thing that occurs to me looking at all these different cases is that initially when sanctions are applied, there is a moment of like potential panic in the country that's been Sanctioned. I mean, one example might be the Russian invasion of Ukraine, 2022. That led to pretty massive sanctions applied principally by the US and the European Union. And there was a moment when people were saying, can Russia survive these massive sanctions? It looked as if, you know, their airplane fleet was going to have to be grounded because they couldn't buy us spare parts. It looked really difficult.

Andrew Thompson: But you go forward two years of the Ukraine war and Russia is doing fine. So I think what sort of happens is there's initial consternation, how do we do? And then a period, how do we cope with this? And then a period in which the sanctioned government finds that, well, there are ways to go. We can send our exports via different routes to different markets. We can adjust this, we can adjust that. And the strange thing, I don't have the exact figure on me, but strange thing is that the Russian economy is going to grow this year or is growing and is doing so in some cases at faster rates than the European Union. That doesn't take away the fact that sanctions are costing Russia money and missed opportunity. But there are ways of surviving.

Andrew Thompson: I mean, if we go back to Latin America for a second, Venezuela has survived and settled virtual collapse. Oil revenues and through a combination of things, exporting through tankers that aren't registered in the US or anywhere else, possible drug trafficking income, possible gold mining income. There is a degree of continuity in the economy already, resilience in the economy that looks quite surprising until you start.

LatinNews: This podcast is brought to you by LatinNews, the leading source of political and economic news and analysis on Latin America and the Caribbean since 1967. Access LatinNews full portfolio of reports at www.latinnews.com.

Richard McColl: Yeah, I too heard the statistic on Russia's growth, and yes, the figure actually escapes me right now. And it's good to bring in Russia and China because this will feed nicely into Venezuela. And as you said, of course, the sanctions, they do cause significant economic pain, difficulties for governments and populations, but we can argue that they fail to expand democracy and dislodge entrenched dictatorial authoritarian regime. So you have, in the case of Venezuela and others, an ability to move oil, an ability to move money, an ability to do trade through either, I guess, middle countries or turning off the transponders on your boats. I think it's called the AIS, the Automatic Identification System. The There are always ways.

Richard McColl: The individual who springs to mind in Venezuela was Alex Saab, who I'm sure has every detail locked up there of how trade is done between Iran and Venezuela and beyond. And you see that the way and again covered in the report of evading sanctions by creating shell companies, different shipment routes and complex transactions. These economic and trade systems appear to be designed to find the loopholes. I don't know what you have to say. The situation Venezuela, as you said, the sanctions started in 2015 and we've just had what are widely believed and agreed to have been stolen elections. And Maduro is more entrenched than ever. The argument is very much against sanctions.

Andrew Thompson: I think I'd like to make two points. I think one is that to avoid sanctions you need, if you like, a team of Alex Saabs, skilled in dealing with, whatever you want to call it, the criminal undergrowth of global economy. And there is, if you like, a class of people who are situated around Maduro and the institutions of government in Venezuela actually benefit. If you're doing, if you're evading U.S. sanctions, the likelihood is that commissions on the deal are going to be much higher than they would otherwise be. So there is this class of nouveau riche who benefit from sanctions. So this is kind of, again, it turns sanctions slightly on the head. What it does is kind of reaffirm that it's the bulk of the population that suffers because of sanctions.

Andrew Thompson: But the group around the ruling elite does quite well out of sanctions and therefore has a lot of incentive to, if you like, to ensconce themselves in power and not to let up. The other point I'd like to make, and I don't want to sound as if everything the US does is wrong, but I think recent events in Venezuela unfortunately seem to show that a particular US approach to sanctions has failed. And the approach that's been really tried out under the Biden administration is the idea of calibrating your sanctions. So you'll Remember, was it October 22nd? I'm not sure I've got the date right, but there was a Barbados agreement.

Richard McColl: Yes.

Andrew Thompson: The Venezuelan government and the opposition parties in the. And the agreement was, which we now know has failed. But it was that the opposition, if you like, pledged to use its good offices to get an easing of US sanctions and the Maduro government pledged steps towards fair and free elections. We know if the universal view that the July elections were fraudulent, we know that deal has failed, basically. But what comes behind it, I think, is the suggestion that by tweaking sanctions, allowing a little bit more of this and a little bit less of that, in the US they've done it through the, through OFAC, the Office of Foreign Assets Control, What they've done is they issued licenses to oil companies to do a bit more in Venezuela than they had previously permitted to do.

Andrew Thompson: And they kind offered that as a way of fine tuning a political opening and a gradual move towards democracy. And what we've seen, or what the latest developments in Venezuela seem to establish, is that the government just wasn't open to that as an idea and still sees itself as having total control or nothing.

Richard McColl: What do we see happening there? Andrew, you are in a better position as an expert on this. The sanctions will be, I suppose, replaced, once again restored on Venezuela, and the people once again will be those that suffer a potential new wave of migration. The statistic that you have as well in the report is that the reduction of food and medicine imports to Venezuela could have increased to 40,000 deaths above normal mortality rates. Again, this is just the regular public. This is not. This is the regular population, not the Maduro regime and his cronies. What do we see occurring, I would say coming months and sadly, if Venezuela doubles down, as it looks to have done, into a more Nicaraguan model of draconian laws and repression, I think for.

Andrew Thompson: The moment we're definitely going to see the bridges being and a period of increased government repression. I think it comes back to the fact which were talking mentioning earlier. If the US Chooses Trump as the next president, US Sanctions will remain very tight. If they choose Harris, there may be some room for relaxation. But Harris will be saying, well, but what do I get in exchange if under Biden, this relaxation happened and the US Got precisely nothing in exchange? I come back to the idea that sanctions tell part of the story. That sanctions inflict economic pain will be bad for the Venezuelan economy and bad for the Venezuelan population. To get a political opening of some kind, you need something else to happen. What that other thing is, I'm not entirely sure. What we've seen is an attempt, you know, to use diplomacy.

Andrew Thompson: We've seen, you know, in recent weeks, Brazil, Mexico, Colombia, trying to form a kind of contact group that might get new elections or some kind of agreement between the Maduro government and the opposition. But I think, you know, the Venezuelan government's been in office for over two decades and it seems that everyone has always been expecting some kind of a political opening which never comes. Frankly. I think something else on this chessboard needs to change. The disposition of the army, the fact that there might be splits in the ruling party. All this is, I'm afraid, speculation, but I think we need to look for some kind of movement on that front. That might initiate a process of change.

Richard McColl: I think a major point on this, of course, if we think of Colombia's President Petro, who sees himself as a revolutionary and sees himself as a sort of freedom fighter, against, I would say the yoke of a colonial regime, and Lula in Brazil as well, comes very much in that mindset. He is very outspoken against the sanctions in this area. And it raises that question, isn't it? What right does a very wealthy country have, a very powerful country have to put sanctions on another one in this situation? And it leads me into the point of this huge argument and discussion that will come into and is policy, of course, in the US but will come even more into the debate as we get closer to November. The issue of migration.

Richard McColl: I mean, to be simplistic, if there was an easing of sanctions perhaps on Venezuela to allow foodstuffs and economic growth medicines, perhaps there wouldn't be an increased wave of migrations up to the US at that southern border wall. And likewise with Cuba, the numbers of Cubans still making the crossing going up through the Darien jungle, as we continually talk about on this, there is a possibility, of course, that these numbers reduce.

Andrew Thompson: I think there is, but it will always take time. And this is probably coming back to the center of the U.S. election campaign at the moment. Donald Trump has been very keen to say that Kamala Harris was the immigration czar in control of immigration and she made a terrible mess of it. That's not exactly true. As is often the case with Donald Trump, she was asked to look after initiatives with Central American republics where increased USAID economic development could be used to reduce outward bound migration and hence the number of people arriving in the United States. So I think that's still an important issue and it's still something, you know, Venezuelan economy has contracted by 3/4. It's 3/4 smaller than it used to be and it has expelled at least 8 million Venezuelans.

Andrew Thompson: So if you could get a recovery going in Venezuela, it might relieve some of the pressure of the migration flow into the United States. But it will take time. You can see something like that taking two, three, four years before those results start coming. And it will be quite difficult because you need, perhaps this would need a bipartisan agreement by the main US Parties that would, if you like, protect each of them from being undermined by the other over the immigration record.

Richard McColl: I think we have time to discuss one more and obviously quite, I would say, well, I was from left field really is Argentina having placed sanctions due to, well, Hezbollah and the 1994 bombing of the Jewish community centre in Buenos Aires that led to the deaths of 85 people. We don't see, obviously Venezuela placing sanctions or Colombia, but Argentina placing these sanctions puts it in a rarefied group of countries in the global South.

Andrew Thompson: Of course, as far as I know, Argentina is not, if you like, aggressively pursuing sanctions against Hezbollah or against Iran. But it did as a result of that tragic bombing in Buenos Aires against AMIA, the Argentine Israelite Mutual Association. It has created this thing called RePET, I can't remember the exact title, but it's a registry of people and entities connected to terrorism. And by all accounts it's quite a good, quite a well kept database of people. And the idea is, of course, should any of them come to Argentina or within reach of the Argentine government, they can be arrested and investigated. Because the other thing is about the 1994 attack is that it's never been resolved. Various court cases have ended up recovering, going on for more than 20 years. But it does raise at least two points.

Andrew Thompson: One is that as were saying earlier, there seems to be an unequal balance between those we've apply and enforce sanctions and those who are at the receiving end. And the other really important point I think to make is that in some cases sanctions may actually be at odds with international law. Certainly in the United States, the Office of Foreign Assets Control can sanction people when it has a reasonable belief that they are involved in wrongdoing, but that's not evidence of the kind a court might require. So it's possible that, you know, if I'm a Paraguayan citizen or a Brazilian citizen and I'm sanctioned, it could be that it's a mistake, they've got my name wrong and I think I would have very little recourse in law. So there is, you know, it may become an issue in the future.

Richard McColl: That's a terrifying prospect. You know, as we close this. Andrew, could we say then, looking at the report, looking at the research and of course all the information available to us, that targeted sanctions as opposed to blanket sanctions against the country. So targeted sanctions such as those towards entities or individuals suspected or accused of narcotics trafficking or human rights violations, corruption, or can make smaller and valuable contributions.

Andrew Thompson: I think so, in part because you've got to judge them in the light of the alternative. If the alternative is comprehensive sanctions, which impact has a big negative impact on the vast majority of the population, targeted sanctions are much better. The fact that people involved in drug trades have their assets frozen is unlikely of itself to cause major economic problems for a large part of the population of country X or country Y. So if you're going to have sanctions, targeted sanctions are better. But I think it's also true that the targeted sanctions don't always work because all types of sanctions don't always work. I think they can work in a specific set of circumstances and we can probably argue about what those circumstances are.

Andrew Thompson: I think the other final point, if I may, is that the vast increase in the number of sanctions poses major issues for international companies. The onus is on them to be up to date on who is on which sanction. It's kind of like a massive know your customer requirement, you as the bank and many banks have done that. If you deal with a person who you think is legitimate, you have a quite no into his or her background enough you are responsible. And you know, one bank, BNP Paribas, was sanctioned for having known drug dealers as its clients for many years. And they ended up paying a fine of $8 billion, which is one of the largest of its kinds in recent history.

Andrew Thompson: And fines that size can be applied to you by the US even though you were perhaps dealing two removes from the main. If there is a US connection of some kind, the US will claim jurisdiction. So I think the short version of this is most international companies really have had to boost their compliance and risk management departments to be able to cope with a fast moving changing situation. Sanctions get lifted on some people and reimposed on others. And you need to be completely up to date with that.

Richard McColl: Absolutely. Truly fascinating, Andrew. I don't see any alternatives being exercised at the moment or in the immediate future in the place of sanctions. And of course what would international governments do? But that's not for us to discuss here right now. That's for another report further down the line. We've been talking to Latin American analyst expert Andrew Thompson in the UK. He has a new report out, Sanctions in Latin America: The Regrettable Rise in the World of Prohibitions. We have covered everything from Nicaragua, Venezuela, Cuba and of course Argentina and of putting it all into international global context. Andrew, thank you so much for your time. It has been a truly enlightening conversation.

Andrew Thompson: Pleasure to talk with you, Richard.

Richard McColl: Well, I've been Richard McColl your host here on The LatinNews Podcast. I'm based in Bogotá, Colombia. Be sure to share and of course subscribe to The LatinNews Podcast. We are back in two weeks time with a further interview about issues of interest from the region. Goodbye.

Outro: You've been listening to The LatinNews Podcast. For more news and analysis on Latin America and the Caribbean, visit www.latinnews.com.

Pablo Policzer is an Associate Professor of Political Science at the University of Calgary and the Canada Research Chair in Latin American Politics. With a specialization in comparative politics, he examines how both democratic and authoritarian regimes manage armed actors, including militaries, police forces, and non-state armed groups.

His acclaimed book, “The Rise and Fall of Repression in Chile” (Notre Dame, 2009), won the Canadian Political Science Association’s prize for best book in Comparative Politics in 2010 and was recognized by Choice Magazine as an “Outstanding Academic Title” for 2009.

Policzer earned his PhD in Political Science from the Massachusetts Institute of Technology and his BA (Honours, First Class) from the University of British Columbia.

Currently, at Oxford, he is investigating the ongoing conflict in the Mapuche territory in Chile post-military dictatorship.

Intro: Welcome to the LatinNews Podcast, a fortnightly deep dive into key developments from across Latin America and the Caribbean. Here's your host from Bogota, Colombia, journalist Richard McColl.

Richard McColl: This is the LatinNews Podcast. I am Richard McColl, your host here in Bogota, Colombia. My very special guest this week is in Calgary, more exactly, he's at the University of Calgary. It's Dr Pablo Policzer. He is an associate professor of Political science at the University of Calgary and the former Director of Latin American Research of the Latin American Research center at the University of Calgary. And we are very honored to have him here. We'll be discussing some ongoing issues and tensions in Chile. So, Dr. Pablo Policzer, thank you so much for coming on the LatinNews Podcast.

Dr Pablo Policzer: Thank you for the invitation. It's a pleasure to be with you.

Richard McColl: Well, you are originally from Chile. You've been there in Calgary and in Canada for a long time. But of course you are an expert on sort of, let's say, comparative politics and armed actors in these countries. And this is what we're going to talk about. We have to talk about the Mapuche conflict that is taking place and has been going for some time, technically since the 1870s in Chile. Perhaps you could put it into historical context for us and the listeners.

Dr Pablo Policzer: Sure. I would go back even further than the 1870s. This is a conflict that dates back all the way to the time that the Spaniards arrived in Latin America and in Chile in the 1500s and the early 1500s. And so that history of the attempt by the Spanish empire to conquer the Mapuche, of course they conquered the rest of Latin America. But the Mapuche are a really interesting group insofar as this is the only indigenous group in Latin America that resisted the imposition of Spanish colonial rule. They are the largest indigenous group in Latin in Chile. They're in the south of the country. From the center to the south of the country. There's some other indigenous groups, Aymara, Quechua speaking groups of various types in the north of the country. The north is much more sparsely populated.

Dr Pablo Policzer: The south is a more temperate zone and it's more densely populated. So the Mapuche are concentrated in the southern part of the country, south of Santiago. Although historically they would have extended, they would have been, they would have lived up as far north as the middle of the country where Santiago, the capital is right now. So when the Spaniards arrive, they try to impose their control over the Mapuche areas, but they don't succeed. The Mapuche to this day are very proud of the fact that they held out for so Long against the Spaniards for about 300 years, in fact. It was a history. It was called the Guerra de Arauco, the Arauco War, where there were moments of intense conflict, there were other moments of peacemaking, but essentially the Spanish Crown was never able to impose its rule on the Mapuche.

Dr Pablo Policzer: And it's actually really interesting that. So Chile gains independence with the rest of Latin America in about 1810. And the last governor of the Spanish Crown, representing the Spanish crown, a fellow by the name of Ambrosio o', Higgins, whose son would become the liberator of Chile. Bernardo O’Higgins, a very important, very famous figure, kind of like the George Washington, the Simón Bolívar, the Chilean history. But his father was the last governor. And it would have been very common for the representatives of the Crown before independence to speak the Mapuche language, Mapudungun, because it was simply the language of diplomacy. They had diplomatic relationships between the Crown and Mapuche authorities in the south of the country. So it was important to speak the language. That is, I.

Dr Pablo Policzer: When I learned this many years ago, I thought it was an amazing fact, because that kind of diplomatic relationship of equal to equal is almost unthinkable from the time that she becomes independent. And I guess that's the history that we'll. We'll look at where once Chile becomes independent, there's a. It takes a while for the Chilean state to dominate, to control those lands, but eventually it does so in the latter part of the 19th century, where, beginning the 1860s, 1870s, there's a process where they. It's called the pacification. The pacification, it's a. You know, it's a poor name for this because it was essentially a brutal imposition, military occupation of these lands. They were taken by force. And the relationships between the Uche groups in the Chilean state have remained fraught ever since. And to this day, a pacification of this nature.

Richard McColl: Would it be good, Would it be all right to say that it was a type of extermination? I mean, rather.

Dr Pablo Policzer: Yeah, yeah. No, it's a misnomer. The Chileans call this the pacification. But it really was a brutal imposition with a great deal through force. The Mapuche communities were. Their lands were taken over, they were dispossessed, and they were given what was, again, I love these. The terminology. They were called reducciones, the reductions. That gives you an exact idea, tells you what exactly happened. They were pushed out from the very fertile, very valuable lands in the central valley of that region, very good, fertile lands, into more faraway lands, less Fertile, less valuable, less desirable lands in the mountains and other places. And so they were put into these, not preserves, but reducciones, where they were reduced into these places and given title to some portions of land.

Dr Pablo Policzer: But then the fight on the part of the Mapuche to regain title to those lands, regain control, territorial autonomy, is the fight that remains to this day. And we can go into some of the contemporary issues there, and it's a long, complicated history, but that's part of what we're trying to understand is what that looks like today, I guess.

Richard McColl: Well, of course, this carries through, I can imagine, the issues of a pacification and las reducciones. And again, as these great terminologies, I can imagine that this runs deep in an oral tradition. Within the Mapuche, you grow up knowing that your ancestral lands have been taken from you by force. This, I would suppose, plays into the key issues of the demands for land rights. The demands? Well, these tensions with entrenched forestry companies and large farming estates. Has anything ever been done to try and placate this conflict, this unease?

Dr Pablo Policzer: Sure, there's been many ways in which different Mapuche groups have attempted to fight for their rights. And one of the things that's. That's also critical to understand in this context is that in Chile, the way in which Indigenous. Indigenous politics have taken place and Indigenous interests are represented is different than in other parts of Latin America or indeed the Americas. So, for example, here in Canada, there is an assembly of First Nations. There's kind of a parallel. It's a legally institutionalized parallel, almost Parliament that has the function of representing Indigenous interests in front of the Canadian state. And it's, you know, it's the owner. It's an officially recognized institution. In other parts of Latin America, Indigenous groups have, for example, in Colombia, they have special seats and representation in the Congress.

Dr Pablo Policzer: In other places, there are institutions that have as their function the function of representing Indigenous interests to the National Congress. But in Chile, that's never been quite the case, and certainly not with the Mapuche community. So the Mapuche don't have a single body that represents their interests. There's a very broad range of Mapuche interests that go from the left to the right. And there's, you know, there's lots and lots of different agendas and politics, policies that have been put forward, but there isn't a single representative body. And so over years, during the 20th century, for example, there were efforts to have, let's say, a Mapuche party that came up in different places. There were some Mapuche Politicians that entered politics.

Dr Pablo Policzer: And there were also, especially during the middle of the 20th century, efforts to advocate for the people who lived in the rural areas, most of whom were either Mapuche or mestizo or somewhere in between. They identified. Sometimes they identified as indigenous, other times they identified as mestizo. But there were efforts to advocate for the interests of the peasants, essentially people who lived on the land. There was successful land reform in Chile in the 1960s. So the rights of the peasants were really important as part of the land reform. There was also a parallel effort of land reform in Colombia during that time, which didn't work. And in Chile, the land reform did work. It actually did succeed in breaking up these large land holdings. And many of the people who benefited from that were themselves Mapuche.

Dr Pablo Policzer: They were campesinos who may or may not have identified as Mapuche, but they were essentially mestizo or Mapuche. Sometimes they did identify, sometimes they didn't. During the dictatorship comes to power in 1973. One of the key things that happens during the dictatorship, this is before Margaret Thatcher, before Ronald Reagan, is the first neoliberal regime that comes to power anywhere in the world. And so in 1974, beginning 74, the Pinochet dictatorship, under the. With the advice of what were called these, the Chicago boys, these neoliberal economists, they try out the first neoliberal policies of radical privatization, deregulation, and so on, Policies that are by now very familiar in the rest of the world, were first tried out in Chile. So what happens is that there's. And for decades, this new system that is really based on the sanctity of private property.

Dr Pablo Policzer: So how that matters for the Mapuche is that one of the things that the Pinochet regime does, and that system then continues after the end of the dictatorship in the 1990s, is the privatization of lands, certainly in the south of the country and especially in the 1990s. That means with the real. When globalization, neoliberal globalization, really begins to take off. After the end of the Cold War, there's this massive entry of forest companies that begin to buy up pieces of land in the south of the country and to really get the forestry industry in gear. Responding to the new, the increasing global demand forestry, for wood products.

Dr Pablo Policzer: So the forestry companies enter into, take over, buy up lots and lots of land in the south, and they enter into, from the Mapuche perspective, they enter into, with the support of the state, into their territories. So the 1990s are a really critical period when the indigenous movement begins to really take off. Not Just in Chile, because it does in Chile, but throughout the rest of the Americas, both South and North America. The 1992 Rio conference, the United Nations Rio Conference, is a critical turning point where the, at that time, still nascent indigenous movement aligns with the still nascent environmentalist movement. The environmentalists until that time had been essentially scientists and some kind of radical advocates, like people in from Greenpeace. But. But. But it was a lot of scientists, people with slide rules and calculators and, you know, charts and graphs and whatnot.

Dr Pablo Policzer: And they align with the indigenous rights movement, and they become, in many ways a single movement in a very powerful force since then, with where the indigenous groups, it's true elsewhere, begin to present themselves as the caretakers of the environment. And so that gives certainly the Mapuche in the south this new impetus to say we need to look after the environment that's being destroyed by the forestry companies that are causing terrible environmental damage. And so that movement begins. And there's ways in which the indigenous movement tries to operate both within the boundaries of the Chilean state and body politic. There's efforts in the new democratic regime. The dictatorship ends in 1990. A democratic regime takes power that time, and the first president, Patricio Aylwin, makes openings to the issue of indigenous rights.

Dr Pablo Policzer: There's a new Ley Indígena Indigenous law that creates a national corporation to advance the rights of indigenous people, to try and work toward restitution of some lands. And so there's some efforts, at least to recognize the importance of indigenous rights, something that the Chilean body politic just hadn't done. And so there's lots of efforts to work within the confines of the standard body politic, the standard institutional politics. But there's also increasing efforts to go beyond that in more radical Mapuche groups that begin to use even violence, acts of violence against the forestry companies, sabotage, arson. And so that begins to occur in the 1990s, and then certainly takes off in a more serious way in the 2000s. One thing I should note also, the really key issue is that Chile, the Chilean constitution, is the only Latin American constitution apart from Uruguay.

Dr Pablo Policzer: Uruguay is a very tiny, almost insignificant indigenous population, but Chile has a significant indigenous population, not as large as Bolivia or Ecuador or Peru, but it has a significance indigenous population. But it's the only constitution that does not to this day, recognize the existence of an indigenous identity. Other constitutions say, you know, we are Colombia, for instance. We recognize that these indigenous communities are important part of the society. They require special rights and privileges and Recognition and so on. And the Chilean constitution. There's a recent historical reason for that, which I can go into, if you.

Richard McColl: Like, tell us the historical reason.

Dr Pablo Policzer: Yeah, yeah. No, no, it's, it's. It's really interesting. It's really interest that. So it's a very, very conservative constitution. It's built around this idea that we have just one identity, the Chilenos, the Chilean identity. That's it. And so on the one hand, and this is an idea that gets imposed in the 19th century during the independence. On the one hand, you can see it by comparison to the colonial period where the Spaniards, the Spanish Empire, was premised on a multiplicity of different identity, a hierarchy of identity between the whites at the top, the peninsulares at the top, and the indigenous at the bottom. So very stratified system that was premised on these complicated layers of different identities. The Chilenos, beginning in. And that's a key date, impose a conservative, a new constitution that recognizes just one identity, Chilean identity.

Dr Pablo Policzer: And I say it's a conservative constitution because it was also very authoritarian in terms of recognizing the importance of the Catholic Church, not very democratic in all kinds of ways. And it imposes a strong state, right? The idea of a strong, very authoritarian state, or then y progreso right, order and progress. So that 1833 constitution comes is a reaction to, in the 1820s, a very liberal period, post independence period. One of the things that happened during that very liberal period in the 1820s was that the government in 18,.

Richard McColl: There.

Dr Pablo Policzer: Was a treaty between the still nascent young Chilean state and the Mapuche communities in the south. The Treaty of Tapihue, right, the Parlamento de Tapihue, where the Chilean government recognizes the existence of the separate body politic, the Mapuche, and they recognize each other and they agree to some kind of peace and cooperation. And so that was done in the 1820s under a very liberal Chilean administration that recognized territorial autonomy and decentralization. Then there's a Civil War in 1829, and the conservatives win with a completely different vision that they say, there's no territorial autonomy. We're going to impose a centralized state directed from the center, from Santiago. And eventually that project Results in the 1870s in taking over and crushing essentially the Mapuche independence autonomy in the south.

Dr Pablo Policzer: And so that one way you're in Colombia, and I always tell my students that one way of understanding the. The difference between Chile and Colombia is that in Chile during the 19th century, the conservatives win, and in Colombia during the 19th century, the liberals win. It's a much more decentralized, fragmented kind of body politic, with all of the problems that remain to this day as a consequence of that fragmentation. But in Chile, it's a highly authoritarian, centralized vision that ends up winning the day in the 19th century and imposes this idea that there's a single identity. We're not going to recognize other identities, just a single Chilean identity. And in many ways, that's been the fight that continues to this day. As you know, there's been attempts to reform the.

Dr Pablo Policzer: So that 1833 constitution was replaced by another constitution, 1925, that eventually gets replaced in 1980 during the dictatorship by a still very conservative, very neoliberal constitution that to this day, as I mentioned before, does not recognize even the existence of an indigenous identity. And that's been a big part of the efforts to overcome this conservative legacy.

Richard McColl: There's just so much entrenched in, I would say, this historic legacy here. I can see it. A quick question to put it into more context as well.

Dr Pablo Policzer: What.

Richard McColl: What percentage of the population, entire population of Chile is made up by the Mapuche community?

Dr Pablo Policzer: It's about indigenous community. It's. It's about 15% of the population, so it's not 60% like in Bolivia. It would be the majority of the population, but it's. It's a significant minority. I think so. Of that. Yeah, of that. Most of the population. Of the indigenous population. Maybe I don't quote me on this. I know this is being recorded, but. But it's. The majority of the indigenous population is Mapuche. There are some other groups, like, for example, Easter island, some Aymara groups in the. In the north that are. That matter, but they're in the minority within the indigenous community. Mapuche really dominates the indigenous population.

Richard McColl: I'd say that a 15%, as you say, is very important. Sizable, obviously not huge, but sizable for a population. And when the Mapuche are taking on a political stance and making very correct claims, are they an entirely united entity or is it quite fragmented?

Dr Pablo Policzer: It's quite fragmented. It's actually very interesting. There's no single political body that represents Mapuche interests or that resolves internal Mapuche conflicts. There's many Mapuche communities and parts of Mapuche society that are very happy being in the Chilean state. Maybe even most would be happy being in the Chilean state. Others don't recognize the legitimacy of the borders of the Chilean state. They advocate for ancestral territory that went from the Pacific to the Atlantic, that is a union between the Mapuche in the south of Chile with the Mapuche in the south of Argentina. And those populations remain there to this day. So they have this vision of a grand, you know, Wallmapu, of a grand Mapuche territory that encompasses both the Chilean and the Argentine communities. And so they don't recognize the legitimacy of the state, the fundamental political unit. So that's a big issue.

Dr Pablo Policzer: And, and it's interesting to compare. I mentioned that there's indigenous groups in the north, Aymara and other groups in the north, far fewer in terms of numbers. But their political organization is quite different in the sense that they do have a body that tries to represent their interests and resolve internal conflicts. In the north, the Atacama Desert, very dry, the driest desert in the world, there's a number of different indigenous communities and they've created, in the 90s, they created something called the Consejo de Pueblos Atacameños, the Atacameño People's Council. And what that does, and this is not something that was created by the Chilean state, this is simply a bottom up, a grassroots kind of organization that for decades has fought to get a place at the table, public sector, private sector, where they're taken seriously.

Dr Pablo Policzer: What they do is they represent 18 different Atacameño communities in the Atacama Desert. And there's all kinds of conflicts in between them over all sorts of things. But they serve as a, the council serves as basically a parliament to resolve those internal conflicts and on that basis then advocate for their interests in front of the public sector or the private sector. But there's no Mapuche People's Council, it doesn't exist. Right. So there's many communities that are very happy with, let's say, the local politics main, the mainstream politics in Chile. Other communities are very unhappy. There's lots of conflict between different communities, right, between different families, different groups. But those conflicts are latent. There's no official organization, nothing like the equivalent of the Atacameño People's Council in the south. And it makes for a lot of fragmentation, definitely.

Richard McColl: So the word conflict is coming up a lot. I think we need to jump on. And I'm curious about these, and you've mentioned them previously, but the militant Mapuche groups coming through and the violence that has been meted out, and I don't dare pronounce them correctly, but I'm looking at one as the Coordinadora Arauco-Malleco and looking at another one as the Weichan Auka Mapu and Resistencia Mapuche Malleco. How influential are they really? And I'm just thinking, because there has been violence, there have been issues and as you said, sabotage. Could they have been. Well, they were behind, I think, some Mapuche radicals. Could they have been behind the murder of the three carabineros, as the police are known in Chile, and the burnt out car, These, this, this massacre by the. Is, is this what's really going on in the countryside?

Dr Pablo Policzer: Yeah, it's a very fraught, complex issue. So as I mentioned, you're right. Since the 1990s, first there was a, an initial group that was, that wanted to advocate for Mapuche interests, that did not advocate for, did not use violence essentially. So that there was a first, it was called. And the leader of that group still around and has sometimes goes to international conferences and, but doesn't have a lot of support, a big kind of massive support behind him. But that was. So while the first government after the dictatorship, Patricio Aylwin's government, made some openings toward recognizing and dealing with the problem of indigenous rights and opening up to this question of indigenous rights and creating the Consejo, the special office to deal with indigenous land claims.

Dr Pablo Policzer: It was one group that decided to be more radical and advocate for the rights of Mapuche people from, like I say, from the Pacific to the Atlantic, so not even recognize the boundaries of the Chilean state. But then this other group, the CAM, begins to operate in the late 1990s and becomes more radical in the sense of taking up arms but against causing damage against property. So there were property crimes, arson and other kinds of sabotage. Arson. They would set actual lands on fire, also damage the equipment of forestry companies. They wanted to get the forestry companies out, but also advocating for this broader vision of the Wallmapu.

Dr Pablo Policzer: So since then also, it's fair to say that the way in which the Chilean state has responded to this challenge has also been very poor in the sense of responding in a typically brutal way. You know, think of the kinds of brutality that occurred during the dictatorship, the Pinochet dictatorship in the 70s especially, and the Carabineros, which were an integral part. The Carabineros, the police force, the integral part of the dictatorship, were never really reformed after the end of the dictatorship. They continued a lot of their basic modus operandi and they have used very heavy handed tactics that have also included even framing supposed Mapuche activists, framing them to try them and put them in jail for crimes in the south. So there has been an increase in violence on the part of some Mapuche groups.

Dr Pablo Policzer: The response by the Chilean state has been heavy handed, brutal Very kind of ham fisted in all kinds of ways. There was a new anti terrorism law. There's groups of charged with the crimes of terrorism that led to all kinds of legal, questionable legal alternatives, including the use of unidentified anonymous witnesses who testified to put people in jail. So a lot of excesses that have been criticized by human rights groups since the Coordinadora Arauco-Malleco. Number of other groups have also appeared who think that if the CAM was a critique of the Consejo de Todas las Tierras, you know, because they thought that they weren't going far enough, then some other groups are now in operation which are critiquing the CAM for themselves, not going far enough.

Dr Pablo Policzer: And so we've gone from crimes of property against forestry company trucks and installations and so on and so forth to now crimes against people. Okay, so there have been the levels of violence in the south of Chile are nothing compared to the levels of violence in Colombia, for example, or in other parts of the region. But they have increased over the past decade and a half. Or so. Part of that is because of the ham fisted way in which the Chilean state has responded. But also there has been an increase in the operations of some radical Mapuche groups. There have been some people who have been killed and so there's people in jail for the assassinations. Again, we're talking very few, very small numbers, you know, half a dozen people. Right. So a handful of victims.

Dr Pablo Policzer: But serious in the context of a country where those levels of violence are generally low. And so that's a concern. Now the other factor recently there's a lot of opaqueness around this, as you might imagine. Right. The other factor recently that has been significant is the entry into Chile of narco influences. The problem of the narcos is now general throughout the continent. We've seen how countries like Ecuador for instance, where previously that kind of violence was unheard of, have seen the massive entry of the gangs and narco trafficking problem into the country in a really serious way. Also countries so countries like Uruguay, Chile, Costa Rica previously were very peaceful. This kind of thing was never was not really a part of the problem. Now are seeing the influence of this. And so there's still, this is early days.

Dr Pablo Policzer: A lot of I know people, some colleagues who are doing fantastic research on this, trying to get a sense of the extent of the influence. That's not just in the south, mostly in the port areas in Santiago as well. But there is evidence of that kind of criminal influence in the south as well. There's evidence of that. There's criminal interest behind, for example, theft of wood from forestry companies. What interests are behind this, how they up, what groups, how they operate, who's involved. Still very opaque. And we're trying to figure out what that looks like. But that is another dimension of this conflict where just like in Colombia, the difference between the political conflict and the criminal conflict is often very blurry. We're seeing some of that same fuzziness and blurriness in Chile as well. So there are political demands.

Dr Pablo Policzer: There's some very legitimate political demands that are being that people are trying to channel through legitimate means. Right now there's a commission, especially created commission by Gabriel Boric. We haven't even talked about the constituent process of the failure of the, you know, the proposed new constitutions. We can talk about that because. So there were these efforts to channel the very legitimate political demands that are being brought forward by the indigenous communities Mapuche, first and foremost by other indigenous communities for to overcome this long standing complaint and very legitimate way in which the Chilean state has ignored, not respected their rights. So those are legitimate political demands. And right now there's a commission especially set up commission by President Boric who's trying to take care of this and is doing some good work.

Dr Pablo Policzer: But there's also ways in which that conflict is being channeled outside official channels, but also in some cases blending with criminal interests as well.

LatinNews: This podcast is brought to you by LatinNews, the leading source of political and economic news and analysis on Latin America and the Caribbean since 1967. Access LatinNews full portfolio of reports at www.latinnews.com.

Richard McColl: I had no idea. But when we talk about the criminal interests, obviously here in Colombia, all very well known, the narco trafficking. I think it's the Tren de Aragua has made massive inroads into Chile. I wouldn't be surprised if they were involved in the port areas Puerto Montt and further south. Of course, the group and we discussed this with Chris Dalby some weeks ago, who's writing a book about it. But I suppose we consider the Tren de Aragua is a very flexible, malleable group wherever there's money. And so as you said, theft of wood and that would get them into the Mapuche lands and into Mapuche spheres of influence.

Richard McColl: But ra dwell on this. You were mentioning again the presidential commissioner, that's Victor Ramos, if I'm not mistaken. And he was working with experts on land, indigenous rights, reparations and so on. And this is aimed to be finished around January 2025. The bicentenary of something you mentioned previously, the Treaty of Tapihue. And do we think it's going to be ready? Because I know it would explicitly recognize the territory I. South of the Biobío River. Did I say it right?

Dr Pablo Policzer: That's right.

Richard McColl: As Mapuche land. Will it hit that deadline? And then finally, because I'm finding this absolutely fantastic and so very interesting, we don't have all the time in the world, but finally there was so much hope, I think, as Boric came into power, that a new constitution could be, well, a constitution could be improved, let's say, to accept that it's not just one identity, the Chileno identity. My concern comes out is obviously you've got Boric here in power and potentially the right coming in at the next election. Is it Kast? Will everything swing back to another hard authoritarian, conservative, Catholic? The. Would you say that the frame that we've seen before? A lot. I've said a lot, but there's a lot to say.

Dr Pablo Policzer: Yeah, yeah. So I'm a political scientist. I'm the last person who will speculate on who the winner of the next election is going to be. Generally, political scientists are pretty terrible at. Or at least, you know, just it's a 50 guess. So Kast is one possibility. There's others as well, who. There's a more kind of center right still right wing politician, Evelyn Matthei, who is also touted as a possible future leader and candidate. And so who knows? But, but it's very likely that there would be a swing, as is legitimate in a democracy. Chile has seen, you know, these swings from the left to the right in the past.

Dr Pablo Policzer: So, but going back to the efforts to try to overcome this historical problem, Chile does have this long standing historical debt with the indigenous, its indigenous populations, to recognize the existence even of an indigenous identity in the country. The only country in Latin America that doesn't do that, aside from, as I said before, aside from Uruguay. So Boric comes to power in 2021. But in the midst of this effort to write a new constitution, this constituent process, that was a reaction to this uprising in 2019, when very quickly there were protests, massive protests, the country's political system came to a halt and it was determined that The Constitution, the 1980, the Pinochet 1980 Constitution was the problem. And so this constituent process, constituent assembly was set up.

Dr Pablo Policzer: They proposed this very progressive new constitution that would have made Chile the third country in the world to be a plurinational state, so after Bolivia and Ecuador. And so that idea of plurinational legal autonomy for indigenous populations. Very, very progressive here in Canada. That question of the extent to which indigenous communities have some degree of legal autonomy is a really important one. There's a lot of jurisprudence on this. There's legal autonomy is recognized. And in a lot of places, Canada has gone quite far in this direction, all while still being maintaining a Canadian state. The country hasn't fallen apart because autonomy has been recognized. But just the idea of proposing this kind of autonomy in Chile was very controversial. And what was interesting was that so this constitution is proposed, it is defeated. Very surprising.

Dr Pablo Policzer: And what's really interesting, it was defeated in a plebiscite, is that it was defeated across the board. Even indigenous communities in the Mapuche territories voted against this new proposed constitution that would have given them all kinds of rights. And that remains a bit of a puzzle. And as a political scientist, I'm familiar with the work of my colleagues in Chile and elsewhere who've done fantastic work on the importance of political parties and how political parties in Chile have withered, have lost their connection to the grassroots, to the base. They've become these elite instruments. And one of the lessons of the failure of this constituent process in Chile is that political parties matter. And in Chile, the political parties have not been doing their job.

Dr Pablo Policzer: And so how did that make a difference in the constituent process is that you had this constituent assembly that was in the first instance, there was a second constituent. So the first one was dominated by the left, the second one was dominated by the right. They both failed. And so the left, the very progressive one, you can think of as being dominated by groups with very progressive ideas, including a number of indigenous representatives, came up with very progressive ideas, but they were not necessarily deeply connected to the grassroots. In some cases they were. But overall, there was no kind of clear mechanism where the political parties were doing what they're supposed to be doing, which is channeling popular interests and demands from the bottom to the top. It didn't happen.

Dr Pablo Policzer: A lot of progressive sectors in the progressive parts of Santiago were kind of really caught up in this idea, proposing this wonderful super progressive new constitution, but they hadn't actually bothered to go out and talk to the people on the ground. And so a lot of people in the communities, local communities throughout the country, who would have stood to benefit from this new constitution basically voted against it because, well, no one's talked to me about this, right, this sounds like all these highfalutin principles, but what does that mean for me concretely here on the ground?

Richard McColl: Anyway?

Dr Pablo Policzer: So that process failed the right wing version of this process, the Constituent Assembly 2 also failed for I think, similar reasons. So we're back to the 1980 Pinochet constitution. Been reformed a few times, but it's still the constitution in place. Boric comes to power in 2021 after a conservative government and he comes to power as a progressive president who is critical even of the left wing Concertación government that had been in power for a long time and after the end of the dictatorship. So the bottage sector is these young students come to prominence about 15 years ago and really critical of the whole system, left to right. And so one of the first things that Boric does, he arrives basically saying, okay, now we're the good guys with regards to the Mapuche. We know that there's been this long standing Mapuche conflict.

Dr Pablo Policzer: And so the first thing that his then Minister of Interior, a woman by the name of Izkia Siches, does very, comes from the medical establishment and you know, very strong, very progressive figure and but made a really big mistake. The first thing that this newly installed Minister of Interior does when assuming power is she goes, she leads a big delegation down to the south to the most conflictual, tricky community in the Mapuche territory, saying, okay, here we are, we're open for business, we're going to talk. And so she'd been invited by one of the leaders there, but you know, there's a bunch of other people in that territory as well. It's not just one leader and hadn't really done the homework of kind of building up the, preparing the ground to allow for this kind of high level meeting.

Dr Pablo Policzer: And so she arrives with a big delegation, cards and so on and so forth for this meeting. And off in the distance there's shots fired in the air, essentially someone others in the community saying, you're not welcome here. And that was the end of that opening was a political disaster, especially right at the very beginning. And so the Boric government has moved from different positions. They started off with a, with the will to just have lots of dialogue and openness and you know, we're the good guys. The, the old conservative governments, those are gone and we can talk. That didn't work. So they've now moved into a position where they've been very supportive of much more even hardline security policies supporting the police. The new Minister of Interior who replaced Izkia Siches is very supportive of the police.

Dr Pablo Policzer: And the levels of violence in the south have actually gone down, which a lot of people have noticed and think is a good thing. Same time now they've created this Commission on Peace and Understanding where Victor Ramos, as you mentioned, plays a key role. There's eight commissioners, and they're politically balanced. There's four from the right, four from the left. And so they have to come up with. They have to make decisions by consensus. And they are, as you pointed out, aiming to have a report by next year to coincide with the anniversary of the Treaty of Tapihue. And that Tapihue treaty is symbolically hugely significant for the work of the commission.

Dr Pablo Policzer: Boric has mentioned that this kind of historical understanding, you know, big political understanding between the Chilean state and the Mapuche communities is inspired in many ways by the Treaty of Tapihue, which was crushed and overcome, kind of forgotten about by the conservative sectors that won the Civil War after 1829. But that historical precedent remains. And so they are making direct connection, allusion to that to. To Tapihue as a. As an important precedent to try and understand, set up some kind of new framework. And so part of what that focuses on is my understanding. I'm not involved in the deliberations of the Commission, but I've, you know, heard some of what's. What's been being discussed is as there's different models for how this might work. So one of the models that people are looking to is Canada.

Dr Pablo Policzer: Canada, where there have been historic treaties between the Crown and Indigenous communities. Not everywhere. The province of British Columbia famously does not have those treaties. And so that creates all kinds of complications. But where the. The focus is really on the restitution of land. Restitution and some kind of territorial autonomy. Right, the recognition of legal, political, territorial autonomy. And that's been really important in Canada, and lots of good things have been done there. Another model is the New Zealand model, which is focused not so much on territorial autonomy and restitution, but on compensation. And that model, the New Zealand model, my understanding, is very attractive to the right wing. The Canadian model of restitution is more attractive to the left wing. But that's speculation. And, but you can see why this idea of compensation, giving some kind of monetary compensation for the historical.

Dr Pablo Policzer: To compensate for the historical damages and the takeover of land and so on, might be attractive to the right wing because it would give Indigenous communities the resources to essentially be market actors, right? Which is what the neoliberal sectors want. They want everybody to be these entrepreneurs, these good market actors. So the right wing could be very happy with that model. But that's part of my understanding. That's part of what's being discussed internally. What it comes out of, what will come out next year when the constitute this commission finishes its work remains to be seen, because decisions are made by consensus. That gives each of the commissioners a great deal of power, veto power, essentially. So it remains to be seen.

Dr Pablo Policzer: But one of the things that's also important to point out here is that the commission has talked to a lot of people in the public sector, the private sector has been lots of meetings in the regions and the territory, local communities in the south, all over the place, and so they've done a lot of that work. But the radical sectors, including those who advocate for violence, have been using violence, are not part of those discussions. So even if the commission were to serve as a, to propose a framework that ends up having the support of maybe even most of the indigenous population in Chile, there's still some minority, for sure, but a significant minority, because they can cause a lot of problems.

Dr Pablo Policzer: There's a minority of those sectors who don't recognize the legitimacy of the Chilean state, let alone a commission that would, from their perspective, reinforcement the Chilean state. The legitimacy of the Chilean state, which is precisely what they don't want. And so how to deal with those sectors is also part of the challenge. And I know that Victor Ramos and others have been involved in efforts to look for channels to establish dialogue with some of those most radical sectors, and difficult at best. But I know that some of those efforts have been tried out and they may be necessary as a complement to the work of the commission.

Richard McColl: Oh, there's a lot here. There's a lot in this conversation. There's a lot going on in Chile with this.

Dr Pablo Policzer: It's a small country, but there's a. But it's, but it's densely packed.

Richard McColl: It's densely packed. It's in the ribbon down the Pacific side. Well, I think we need to wind this down. We need to wind this down. Dr. Pablo but there's something here is everything, not everything, but so much seems to hinge on this bicentenary of the Treaty of Tapihue. You're a political scientist. You do not like predicting anything, elections. But do you feel that the prospects for a more amicable solution and future are there, or are we confined to a continuation of uncertainty and instability?

Dr Pablo Policzer: I'm cautiously optimistic. I'm cautiously optimistic in part because the recent experiences of failed constituent processes with the Constituent Assemblies have left people really quite, I think, frustrated and the, I think with a better understanding of the hard work that this kind of democratic politics takes people describe famously, I don't remember who the original should know this as a political scientist who the original quote is from, but define democracy as the slow boring of hard boards. So it's okay. It's painstaking work and that work requires the hard work of political parties.

Dr Pablo Policzer: And that's where I think the challenge is that many political scientists have pointed out correctly that political parties in Chile have not been doing their work, have been very poor at doing that slow boring of hard boards to really bring the legitimate concerns of people at the on the ground to the mainstream of the political system. So I think with a better understanding of that, with a much more kind of sober analysis of the real problems after the failure of this constituent process that really excited a lot of people, made a lot of people very hopeful. So people are disappointed, but more kind of sober after a period of great possibility that ended up not working. But now we see that there's a lot of hard work to be done and I think people are willing to do that hard work.

Richard McColl: Well, thank you so much. Thank you so much for your insights and really quite incredible depth of knowledge on a subject that I know will capture the listener's attention and interest because it really beyond the sort of beyond academia and beyond the Chilean news media, there's very little actually covered about this issue. Something that, well, it's becoming increasingly important across the world. And you've made, you've alluded to Colombia, you've alluded to Canada, New Zealand and so on, of course, Argentina as well. And so therefore we can see the importance of this in future, let's say, debates around identity, especially in Latin America, but not least Latin America, but elsewhere in the world. So let me take this moment to say thank you so much to Dr. Pablo Policzer, who is an associate professor of political science at the University of Calgary in Canada.

Richard McColl: He is also the former director of the Latin American Research center at the University of Calgary as well. It has been an absolute pleasure and really very captivating. Thank you for speaking to us on the LatinNews Podcast.

Dr Pablo Policzer: Thank you. It's been my pleasure.

Richard McColl: So I've been Richard McColl here in Bogota, Colombia. This has been the LatinNews Podcast. We will be back in a fortnight with further conversations about important topics from the region. Thank you for listening and bye.

Outro: You've been listening to the LatinNews Podcast. For more news and analysis on Latin America and the Caribbean, visit www.latinnews.com

Javier Corrales is a distinguished Political Science professor at Amherst College, holding a Ph.D. from Harvard University. His research encompasses democratization, presidential powers, populism, and political economy. Notable works include "Autocracy Rising," analyzing Venezuela's authoritarian turn, and "Fixing Democracy," on constitutional impacts on presidential power. He has contributed to prominent journals and media like The New York Times and NPR. A twice-awarded Fulbright scholar, Corrales has taught globally and consulted for major international organizations. Currently, he researches populism, polarization, and democratic backsliding.

Intro: Welcome to The LatinNews Podcast, a fortnightly deep dive into key developments from across Latin America and the Caribbean. Here's your host from Bogota, Colombia, journalist Richard McColl.

Richard McColl: This is The LatinNews Podcast. My name is Richard McColl. Here in Colombia this week we're going to be dealing with the incredibly pressing issue of the presidential elections in Venezuela. I'm very honored to have with us Dr. Javier Corrales, who is the Dwight W. Morrow 1895 professor of Political Science at Amherst College in Massachusetts. And we're going to discuss best case and worst case scenarios for the Venezuelan elections due to take place on 28 July. Dr. Javier, welcome on The LatinNews Podcast.

Dr. Javier Corrales: Thank you so much for having me.

Richard McColl: It's an absolute pleasure to have you here. Why? Because Venezuela is so much in the news and rightly so. Rightly so. We assume, maybe wrongly, maybe we are slightly out of place, but we assume that the elections on 28 July will not be free and fair and the regime of Nicolás Maduro and of course Diosdado Cabello will prevail. Could you perhaps give us some background?

Dr. Javier Corrales: It's not that we have to assume it. It's already clear and evident that this is not a free and fair election. There are already plenty of signs of the unfairness and lack of freedom. The question right now is what new tricks the government may deploy to stop what seems to be an inevitable defeat if this were a free and fair election. There are many interpretations about the polls, but all polls suggest that the government is very unpopular and the opposition candidate is very popular. So in a free and fair context, this is almost a settled outcome. But because we are dealing with an election that is very unfree and unfair, anything can happen between now and then.

Richard McColl: So we’re looking at, I was looking at some of the possible outcomes, the best case scenario. Best case scenario, very unlikely. Nicolás Maduro commits defeat and negotiates a way out for him and his entourage. Or then we've got a distraction policy of maybe moving more forces towards Guyana. And I would suggest delaying the elections through a kind of argument of national sovereignty. Perhaps some hours before the election, Maduro could disqualify Edmundo González. I suspect we will see massive voter fraud. And then I guess we have to also consider that this is only a presidential election. All the elements of power remain. So maybe we could address each one of these. If you think, if you think I'm on the right track here.

Dr. Javier Corrales: Okay, why don't we go by parts? Let's start with the best scenario for democratization. The best scenario for democratization would be that the opposition wins and the government accepts the results. What would be the reasons under which the government would accept results? I've looked at situations in the past where a dictatorship decides to run an election and discovers on election night that they lost. And it's a very delicate moment because the initial instinct is for many members of the dictatorship, including the dictator, will be reluctant to concede defeat. This can happen also with democratically elected presidents, as we saw in the United States. But it's very high probability in a dictatorship. What do we need? What needs to happen? The size of the victory has to be pretty significant for the opposition.

Dr. Javier Corrales: Number two, the opposition needs to be able to have evidence that it got those votes. And that is only possible if the opposition has been able to monitor all the electoral centers, which I think is going to happen. Number three, there has to be a split in the ruling party. It should include some technical folks and some military folks who will tell the government it's over for us. There needs to be as well. Let's keep going all the conditions that we need. Now, let me say this particular point may happen. It is conceivable that some groups in the military and some technical groups would say it's really, we cannot do more fraud that we have done.

Dr. Javier Corrales: The next thing that needs to happen is the dictator needs to be able to have international allies that will also tell them that, you know, it's better for you to start. People argue that maybe Brazil and Colombia could do that so that can happen. And then finally there has to be a conversation between the opposition and the dictator about making sure that this is not going to be the end of these people's careers. We don't know whether that's going to happen or not. So the best case scenario is not unrealistic. It's just that it requires a set of conditions, all of which may or may not happen between now and then. Some are already happening, which is good, but there are other conditions that are still continuing. Now that is the best case scenario.

Dr. Javier Corrales: If you want, we can now go deeper into it or start to think about the worst scenarios, which is all the tricks the government could try to avoid getting to this kind of an electoral outcome.

Richard McColl: I think the worst case scenario as well, what I mentioned. And then of course, one thing that a lot of people are not familiar with is the six month wait between July 28 and then the transfer of power on January 10, 2025. This provides for me the regime with all sorts of options to double down. Almost like an Ortega regime in Nicaragua.

Dr. Javier Corrales: Right. I mean, things that can happen during that period is the government can claim that there was fraud in the election and they have to run the election again. This is. They may create a bunch of obstacles. We just saw in Guatemala, for example, the transition period was an example of what governments can try to do to prevent the winner from coming to office and create and intimidate them. The Chavistas are going to be fully entrenched in a large number of institutions in the country, in the bureaucracy, throughout the nation. The military is all Chavista. A great number of business leaders are Chavistas. A great number of illicit actors have ties with the government. So it'll be very difficult. In other words, even if the government accepts defeat, it will remain a significant degree.

Dr. Javier Corrales: It will still keep a significant degree of political bargaining leverage vis-à-vis the winners, and they are going to dictate the terms of what comes next. So there is plenty of things that can happen after election day. Absolutely.

Richard McColl: And I mean, we know that the regime has obviously promoted people within the army and pays for their loyalty. Does this make it, does this make Maduro kind of coup-proof?

Dr. Javier Corrales: He has already demonstrated some of that. Now, this is not a permanent condition, but there is no question, and I have written about this, that what Maduro has done is to do plenty of the things that we see dictators do to become coup-proof. It's a combination of rewarding loyalists with both tangible benefits, but also a significant degree of privileges, sort of like turning them into, you'll never get in trouble as long as you're loyal to the regime. And this produces quite a significant degree of adherence, but also a significant degree of repression within its ranks. We know, I don't know the numbers, but we know that a number of political prisoners are folks from the military.

Dr. Javier Corrales: We hear reports that a lot of the Cuban intelligence is deployed mostly to intercept bad noise happening within the military and within the movement, and that the government, in many times as nasty as the government has been with the opposition, it has been even nastier, with signs of dissent within the coalition. So you create this combination of folks who are in it for the profits, in it for the ideological affinity, but also in it for the terror. And this means that the regime seems to be relatively coup-proof already. Now, that said, we know that when dictatorships have an election and the elections don't come out the way they want, this produces a new type of crisis that can induce Chavistas to say, look, this is undeniable. Let me just put it this way.

Dr. Javier Corrales: They would say things like, if we want to not respect the results, we are going to have to be asked to do certain things in this country that we refuse to do anymore. And that's a possibility. This is why it is a big moment. And in many ways, the government didn't anticipate this. The government entered into this path of going to an election not thinking that it was going to be confronting such a formidable opponent as they are by now.

Richard McColl: This is what's so interesting to me is we got the idea that Maduro really thought who was going to win. I mean, outright.

Dr. Javier Corrales: Yes. All right, so dictators are using elections a lot, many times. One of the reasons they often still do them is because they have a certain confidence that they can win. This confidence is sometimes overstated. This confidence is sometimes not overstated. They think that they're competitive enough. And there's no question that Maduro, when he signed the Barbados Agreement back in 2023, son, he could do this the way that he. His plan was, I know I'm unpopular, I know that I don't have the degree of popularity that allows me to win, but I can go to an election with a divided opposition, an opposition that is going to have very weak candidates. And we can try a bunch of the other tricks. Discourage participation by opponents, boost some of our voters, and this will allow Maduro to win with 30% of the vote.

Dr. Javier Corrales: And that's going to be the game plan. And so let's sign the Barbados Agreement. We can do this, that plan. By December, after the opposition's primary went down the drain, when the government realized that there was so much enthusiasm for one candidate, an enthusiasm not seen since the Guaidó era, and perhaps more so because under Guaidó, there was never really an electoral showing. And then they panicked and then they started to try new tricks to avoid having to compete with María Corina Machado. But in the end, they couldn't outsmart her decision to endorse a candidate who was allowed to run. And now they're facing this problem. They're facing the problem that the opposition has a level of unity and a level of enthusiasm that they never anticipated.

Dr. Javier Corrales: And it might be too late at this point to sort of like basically interrupt the whole thing at this point. They can still do it. If they do it. If they do it, there's going to be protests in Venezuela. I have very few doubts about that. They will need to make the calculus that this time around they can do what they did in the past every time there were outbursts, because Venezuela has had big outbursts. And what they did in the past was deploy enough force to really neutralize it. So they're going to have to come to a calculus where they say, we can do this again. It'll probably be the biggest outburst of protest.

Dr. Javier Corrales: And if they come to the determination that they can actually neutralize it, then they might do something as crazy as at this point in the game, say, we're not going to have an election right now. So it's not out of the question. A lot will depend on how they estimate their ability to really repress a potential outburst of protests.

Richard McColl: This is a, a great concern because there will be loss of life. How do we see if. Should this be the situation? How do we see Edmundo González and María Corina Machado responding to this? They'll obviously call out to the international community, but I would imagine that it will be President Lula in Brazil and President Petro in Colombia who will be the ones to step forward and say, let's negotiate a democratic solution to an unpleasant situation.

Dr. Javier Corrales: I don't know, Richard, really, what plans María Corina Machado and Edmundo González have. I don't think it's in their interest to disclose plans about this. Now what we do know is that when a semi-authoritarian or authoritarian regime creates an electoral disruption so close to election time,.

Richard McColl: You.

Dr. Javier Corrales: Inevitably get voters to go out into the street and do something, even if leaders want to take it easy. So it's almost like we see it all the time, especially when there's this kind of enthusiasm, when voters feel like history is on their side, which is what's happening in Venezuela right now. Now are they will Machado and González have the ability to create an international coalition that will then be able to convince Maduro and his coercive apparatus to take it easy? I don't know if they are at that point in, in. In their career now this. They have an extraordinary international reputation right now. María Corina Machado's stature internationally is at a high point.

Dr. Javier Corrales: And in so many ways, González is a nice supplement because some of the things that people might criticize about Machado, for example, in the past, she has always been a bit of a hardliner on certain things. With González, he's campaigning on a platform of more reconciliation. So they are producing a bit of a. They supplement each other. It's an amazing ticket. It was an accidental ticket, but it's working out Very nicely. And this has given them a sense of, that they're doing all the right things. The thing sort of like the expectations that the international community has on opposition candidates are very high. You know, they won't forgive you for minor trespasses.

Dr. Javier Corrales: And this team has met all those expectations, despite the fact that I think that the international community often has incredibly unreasonable expectations about how opposition candidates have to behave in an electoral contest. They’re doing really well internationally. So they may be able to this time around, produce an international coalition that could restrain a hardline response by Maduro in the event of massive protests.

Richard McColl: As you say, they seem to complement one another the sort of. Edmundo González is more, as you say, conciliatory challenge. María Corina Machado has been known for more hardline stance. I think we need to consider this, you know, this is not a conventional election and against all odds, this is the positive. The opposition has stuck together and decided to invest in democracy. And well, I guess the hope is amongst Venezuelan that the discontent is so broad that the opposition has to accept the election. But there was something that you mentioned in terms of the military previously, a lot of the political prisoners being military members is you talked about Cuba being involved. What is the situation with other external governments being involved, Russia, for example? Is there a disinformation campaign such as in 2019?

Dr. Javier Corrales: Yes, I mean, I think. Many analysts, not just me, have made the point that the, one of the key elements to Maduro's survival has been the kind of external support he receives from a multitude of sources for different things. This is not the only reason. I mean, I would never say that this regime is in place because of exclusively international support, but there are these international anchors. It's a coalition of folks who are very much in favor of the status quo, very happy with the kind of deals that they get from Maduro of all kind. You know, each partner gets something different from the Maduro regime. And we're talking about all the way from India to Turkey to some Gulf states, of course Russia, China and obviously Cuba.

Dr. Javier Corrales: So he, I mean, Maduro started out, remember, we have to remember that Maduro was a foreign minister under Chávez. So I think that is, he has played well. The biggest. No, let me just say this. So Russia, of course, loves having an alliance with Venezuela because Russia is in the business of creating trouble for the United States and having friends everywhere and is very good about producing disinformation. And, and has also helped Venezuela bypass the sanctions, etc. But the big question here always is China. We have evidence, well, evidence. We have reports of people who do talk about the fact that China is far more displeased with Venezuela than. Than one would think from an economic point of view.

Dr. Javier Corrales: From an economic point of view, China has invested in Venezuela far more than in any other Latin American country and probably at the top of the world list. And what it is getting out of Venezuela is so terrible. It's sort of like the returns on the investments are terrible. This is probably China's worst economic partner. And the Chinese do like to think in terms of economics and that the inability of the Maduro regime to deliver economically is something that the Chinese have registered as being a problem. And yet it doesn't seem like they have been willing to press Maduro out. Who knows? I'm not 100% sure that they are perfectly committed to the survival of Maduro, but they're not committed to a change as well. So it's a big incognito here for me.

Dr. Javier Corrales: There are signs of the Chinese being nervous about a transition, but we also know that they are displeased with the economic losses that they have experienced. Venezuela owes China a lot of money. I think it's the second debt in the world Venezuela tries to pay. It's sort of like it's not like it's in default. And they have worked out agreements. But this is not the way that the Chinese like their economic partnerships to be. The Chinese like to make money, not to just be repaid. And they have not made good money in Venezuela. And I think they have noticed this. This means that they might not necessarily be that opposed to the rise of some kind of transition in political transition in Venezuela. Who knows, maybe I'm being.

Dr. Javier Corrales: Maybe I'm reading the Chinese with lenses that are too economics focused, perhaps, but they might be a little bit more pragmatic than some of Venezuela's other more ideological or politically minded international partners.

Richard McColl: It's a very interesting topic on China. And I mean, as you say, they may not be 100% behind a change or a transition. Do you think the representatives from China may have already reached out to Edmundo González or María Corina Machado?

Dr. Javier Corrales: I'm not sure about that. I would simply say that if the opportunity had arisen and that team didn't seize that opportunity, that's probably a strategic mistake. But I'm not sure what might have transpired between Chinese officials and opposition figures in Venezuela.

LatinNews: This podcast is brought to you by LatinNews, the leading source of political and economic news and analysis on Latin America and the Caribbean since 1967. Access LatinNews’ full portfolio of reports at www.latinnews.com.

Richard McColl: I think this is a good moment to slide into what is going on in the US and of course, the Barbados agreement and President Biden. What I think we should probably mention right now is the United States and the Barbados Agreement that you feel that President Biden brought forward to try and take maybe a little bit of stress off the southern border and the Venezuelan migration north. If we put it into context, there are roughly 8 million Venezuelan migrants to have left the country, and 6 million of those still remain in the region, obviously mainly Colombia and Panama. But what might happen? Would we expect another wave of migration from Venezuela should the regime continue?

Dr. Javier Corrales: I think in the short term, if the Maduro regime declares that they won the election, and the perception is that is not a credible claim, I think there's going to be continued turbulence in Venezuela for several months forward, and turbulence in the context of dictatorship and economic immiseration is the formula for further migratory movements. So, yes, absolutely. Now, having said that, it is true that one could argue that the entire country is not going to leave. So at some point, migrations sort of flatten out a little bit. This is already a massive number who has left, and at some point it's going to plateau. So this is one of the ways in which, you know, really horrible conditions become sort of like people become adapted to it. They decide that they're never going to leave. They're always the we will never leave.

Dr. Javier Corrales: So it may stabilize at first. But my point is that it's not inconceivable that Maduro declaring that he won the election will bring Venezuela down into a path of new turbulence that will generate a new type, you know, a bump in the migratory crisis that we're seeing.

Richard McColl: And let's put into the possibility of a, well, looking like a very likely possibility of a Trump victory in November. What do we expect, again, if the Maduro regime hold on. There's so many ifs here. If the Maduro regime hold on to power somehow and a Trump victory in November, do we expect the US Foreign policy to slap further sanctions on Venezuela or, you know, potentially. They, they once talked about military intervention. Do you have any ideas of a possible outcome?

Dr. Javier Corrales: I find that one of the hardest things to predict is Trump's views on anything. This is his. But let me, let me actually make this a little bit more analytical. On the one hand, he likes to be the punisher-in-chief. He has that streak. He gave us the maximum pressure policy. He likes to appear tough and intolerant and et cetera. He has that aspect to him and it can come back with a vengeance. But he also likes to be the one who is the pragmatic, who basically has no problems with dictators. And he's Mr. Fossil Fuels. Venezuela is Fossil Fuels. He's Mr. Pro Russia. Venezuela is a Russian ally. He likes to say that he can settle things so we never really know. He really embraces night and day at once, hardline, soft line, intransigence and negotiation. It is important to notice.

Dr. Javier Corrales: It is important to notice that he did not pick Marco Rubio. Why this matters for Venezuela is that Marco Rubio represents the faction in the Republican Party that feels that Trump needs to focus on Venezuela and that the focus has to be on tough, tough, intolerance. Vance, on the other hand, has a very lenient approach toward Russia and who knows, in other words, this is a hard question for me to address, Richard, because I do think that anything can happen. Whoever tells you that they know what Trump is going to do with Venezuela either has really inside information or really does not understand the extent to which Trump is such a chameleon.

Richard McColl: And, you know, anything that he might do is for immediate benefit of appearing the strong, immediate benefit of, as you said, the punisher-in-chief.

Dr. Javier Corrales: He's either the punisher-in-chief or let's make the deal-in-chief. And he's had a long tradition of making deals with incredibly unsavory actors just to appear as the person who solved the problem. So, yeah, I mean, there are folks who are longing for the maximum pressure policy even though. Even though that policy failed really badly. Because when it was deployed right around the rise of Guaidó in 2019, really, the regime was at its lowest point politically and economically. Guaidó was the star of the period. And in two years, the maximum pressure policy produced this reversal of fortune. Maduro all of a sudden was a new and brilliant emperor with far more power than in 2019. And Guaidó suffered a premature death that nobody imagined could have happened.

Dr. Javier Corrales: So the policy of maximum pressure continues to have supporters in the Republican Party and among Venezuelans, but it really also has many detractors from the conservative side as well. There are conservative actors, supporters to the Trump campaign that are very fossil fuel oriented and very, let's be nice to Russia, and they are part of the Republican ticket. Who knows how Trump is going to solve these two very competing factions. But they're there and they're part of, they're going to come together. Whenever there is a conversation about what to do regarding Venezuela,.

Richard McColl: The lobbyists in Washington, the Venezuelan economic clout within the US will undoubtedly play some part in all of this.

Dr. Javier Corrales: Right? Of course, Venezuela has been the dominant theme outside of issues pertaining to North American trade. The Venezuelan situation has been, I think, the most dominant aspect of US foreign policy in the Western Hemisphere because it touches on so many important things to the US foreign policy establishment. It has to do with democratization and folks who are interested in promoting that. But it also involves energy security, it involves illicit drugs, it involves migration, and it involves, of course, ties with rivals of the United States. So Venezuela really has all the, it sort of pushes all the buttons that matter in US foreign policy. Oh, and now, in addition, Venezuela has produced such a large exodus that we now have US citizens with a strong Venezuelan tie who play also part of electoral politics in Florida. So obviously, Venezuela is huge.

Dr. Javier Corrales: Now, what is important about the point that I am saying is that there isn't a single constituency for Venezuela. Each of these buttons that I've described has debates about them on how to deal with them. So it's very complicated. If you really want to listen to all the parties, then you might be receiving a very complicated set of different wave transmissions. So we'll see. There's. It's, it's. We tend to think. We tend to think that paying attention to an issue creates some kind of coherence. But many times paying attention to an issue may not give you coherence because when you pay a lot of attention to an issue, then you get, attract multiple messages and the team dealing with the issue maybe feel disoriented.

Richard McColl: Yeah. Well, Dr. Javier, as we wind this down, one question. How long has it been since you were last in Venezuela?

Dr. Javier Corrales: I'd rather not answer that, but it's been a while. I have decided not to go to Venezuela. Considering the security situation in the country.

Richard McColl: Definitely. Fine. That's absolutely fine. Indeed. Let me take this moment to say thank you so much for your time and explaining the uncertainty, the tensions and instability that these elections, you know, really harbor and will create and are creating across the region, not just in Venezuela itself. It has been revealing conversation. All eyes are on Venezuela for 28 July to see what the regime may come up with. Thank you so much for your time.

Dr. Javier Corrales: On the contrary, Richard, this has been great. Thank you for having me and my best wishes to your listeners.

Richard McColl: Thank you again. I've been Richard McColl, your host, The LatinNews Podcast speaking to Dr. Javier Corrales, who is the Dwight W. Morrow 1895 professor of Political Science at Amherst College, Massachusetts. It's been a phenomenal conversation about what's coming up and what we may expect in Venezuela in these coming weeks prior and post 28 July and the presidential elections. Please go, read, watch and follow what's going on in Venezuela. Because of all the points we previously mentioned, it is incredibly important. Thank you for listening to The LatinNews Podcast and goodbye.

Outro: You've been listening to The LatinNews Podcast. For more news and analysis on Latin America and the Caribbean, visit www.latinnews.com

Andrei Gomez-Suarez, based in Oxford, specializes in conflict resolution and peace negotiations. He co-founded Rodeemos el Diálogo (ReD) and works as a Senior Consultant at Positive Negatives. His academic work includes books like "Genocide, Geopolitics and Transnational Networks" (Routledge, 2015) and "El Triunfo del No" (Icono, 2016). Andrei is also known for creative projects like "Jessica" and "La Confianza," focused on Colombian issues. Currently, he's writing a memoir about growing up amidst political violence in 1980s southern Colombia.

Intro: Welcome to The LatinNews Podcast, a fortnightly deep dive into key developments from across Latin America and the Caribbean. Here’s your host from Bogotá, Colombia, journalist Richard McColl.

Richard McColl: This is the LatinNews Podcast. I am your host here, Richard McColl in Bogotá, Colombia. Our very special guest this week is here as well on a, well, not a routine visit back to Colombia. But for those of you who follow academic articles and writing about peace in Colombia, you'll need no introduction to Andrei Gómez-Suárez, who is a senior researcher at the University of Winchester and general director of the Anglo Colombian Peace Building Organization Organizing association called the Rodeemos el Diálogo. So, Andre, welcome on the LatinNews Podcast.

Dr Andrei Gómez-Suárez: Richard, thank you so much for the invitation. It's great to be here with your audience.

Richard McColl: It's great that you're here in Colombia. It's great that you're here in Bogotá and we can speak in the same time zone and discuss what's going on in Colombia because it's, well, I mean, it's never calm in Colombia, but I would say that we're in a turbulent moment or something. Certainly it's, it feels unstable. We give a little bit of background to what's going on. Of course, those of you who follow Latin America and follow Colombia know that we have our first ever leftist president, a former M-19 guerrilla in Gustavo Petro. He has now he's done two years in the job, more or less one of the cornerstone policies of his government, of course, is the paz total or total peace. And that's what we'll be discussing with Andre.

Richard McColl: But also he believes and very much has lauded the policy of being a government of change and therefore getting reforms, more equitable reforms pushed through Congress and the Senate to make changes in Colombia. So if we before we focus on and there are so many negatives that come out in the international press and national press about what he's doing. But perhaps we could focus quickly on the positives. He has pushed through a more equitable tax code. He has re-established diplomatic and commercial ties with Venezuela, neighboring Venezuela. He has maintained, albeit somewhat wobbly but good relations with the US despite there being a difference in drug policy practices. He's, well, got the pension reform through Congress. It just needs to be signed off by the Constitutional Court and well, he'll be working towards other things as well.

Richard McColl: And then on the negative side, at the moment, his approval rating stands at 32%. His disapproval rating stands at 62%. But he's a stubborn man and he's, well, I mean, he's barreling Forwards with more desires on affecting this government of change. Andrei, perhaps you could jump in and give us a little bit of your feeling as to what is going on right now with the government of the double head.

Dr Andrei Gómez-Suárez: Thanks, Richard. Yeah, I think you're right. Petro has been for the first two years of his presidency, so he's getting to half term. The first year was about learning to be government. This is the first time ever we have a leftist government. The left had never been allowed to get into power, and it's been a steep curve of learning. So the first year was mainly spent on that. I think he managed to pass the tax reform, as you mentioned. That was a great achievement of President Petro. But second year has been a bit more complicated. Some of the other important reforms have been stuck. He didn't get the health reform. That for him was very important. And his communications campaign has been a bit of a challenge for, I would say, the general audience in Colombia.

Dr Andrei Gómez-Suárez: As we know, he has been facing harsh criticism from all the mainstream media in Colombia because the media in Colombia is owned by big money people, like the proper economic establishment in Colombia. And he has realized that the only way to communicate his policies is by him becoming the communicator. So he's the center of attention. His Twitter is really where he communicates everything. And he tries to control the political agenda through that. On the back of that, he's been working to try to achieve total peace in Colombia. I think that's what we're going to spend the next 25 minutes or so talking about. But I think that's a really important policy that has a good analysis of the root causes of the conflict, but tremendous challenges to be implemented.

Richard McColl: I think we need to look at this as well. I've been very supportive as analyst, consultant, journalist, looking at total peace, having been here for many years, when it was first announced and when he talked about it as an inaugural address, which people will be obviously quoting for years to come, because it was an incredible inaugural address. He's taking the armed conflict in a different sense. The first time that people are looking at this from the causes of the conflict and inclusion and trying to negotiate with all different groups at once. Now, this is obviously incredibly difficult. And I don't remember the Red Cross or another entity has said that there are six to eight ongoing conflicts within Colombia. And these are conflicts within illegal armed groups against one another and illegal armed groups and the state. It just makes this very complex.

Richard McColl: And you can also understand, okay, we have this problem In Colombia, we have had a long running internal conflict involving left wing guerrillas. We've had the 2016 peace accord, which took the majority of the FARCC of the Revolutionary Armed Forces of Colombia. And we date back to 1964 and the cold War and everything else. Most of them were, you know, signed up to the 2016 Peace of Point under President Juan Manuel Santos. And now there's a negotiation. I think we'll start with the eln, the UN other leftist group that remains the National Liberation Army. And this has been on again, off again for, I think it's seven different presidencies, talks with the eln. What is different this time around? Is this a group that really wants to sign up for peace?

Dr Andrei Gómez-Suárez: Well, that's a difficult question because it's a question that should be answered in the most honest way and is saying that you don't usually get groups who are really willing to sign a peace agreement. What you need to do is to get them into the process of negotiating peace to realize that's what they want to do. So I would say that the ELN really distrust the Colombian state. They see the arrival of Petro as an opportunity for them to start negotiations with a new government, but they are skeptical of the government being able to be not trapped within the infrastructure of a state that has been built by the Colombian elites and for the benefits of the Colombian elites.

Dr Andrei Gómez-Suárez: What I think is important to know in terms of this attempt to find a negotiated deal with the ELN is that Duque really left the process almost agonizing. As we know, he broke the negotiations that had started under President Juan Manuel Santos, and he actually even campaigned in the US for Cuba to be again one country listed as a country that supports terrorism, thanks to the support that Cuba has allowed for the negotiations with the eln. So really there was no trust between the ELN and the Colombian state at all when Petro arrived to the presidency. And what this process has done is to actually put at the center of the negotiations a key element that all the other presidents were quite skeptical of and is the participation of civil society as the core of the negotiation.

Dr Andrei Gómez-Suárez: So both the ELN and the Colombian government in the last two years have managed to agree on how to create a methodology for Colombian civil society to participate on a national level dialogue in order to agree on the most important structural transformations that need to take place in Colombia in order to overcome the inequality and the poverty that prevails in many regions of the country. And I think that's tremendously different from previous negotiations. Where a state was very worried of giving too much participation of civil society. And if there is a reason of hope in these negotiations, is that both the Colombian government and the ELN are interested in listening to the civil society to hear what are the transformations that are near build peace in Colombia.

Richard McColl: So this sounds all very positive indeed. When you get a group like the ELN coming to the table with their list of requirements like to overhaul and change the capitalist system within. It's. It's a far fetched, it's a far fetched requirement. It just, it just sort of, it leaves more questions than it does answers. And I just, I wonder as well. And there's a lot of talk about the fracturing of the ELN because you've got the older generation, say the real believers in Marxism and so on, who are in Cuba or in Venezuela engaged in the peace dialogues. But then you've got the younger generations from the ground, let's say in or strategic departments in Colombia for coca brewing, trans shipment, arms, whatever, anything illegal. These are these are key calca key departments. How connected are they to the older?

Richard McColl: We call them the Secretariat. That was the FARC, but where the older sort of leaders of the eln, surely there must be a disconnect, I.

Dr Andrei Gómez-Suárez: Think, when understanding the ELN is one of the biggest challenges in Colombia, because the part of the ELN that is in arms, let's say, is rather small. If you think about the size of people in arms of the ELN, it's around 3,000, 4,000 people in arms. And within those, you are right that there is a sector of them who are very young and have just been brought into the group and are in a process of indoctrination, let's say. But beyond that, the ELN has a broad social network of people who sympathize with the ideas of liberation theology and Camilo Torres. And that is a large sector of social movements in Colombia that have a huge influence on the top leadership of the eln.

Dr Andrei Gómez-Suárez: So when we are thinking about the success of the negotiations with the eln, it's about connecting the needs of the people who empathize with the ideas of Camilo Torres and connecting that with the leadership of the ELN to convince them that giving up their weapons, it's a good idea in order to get the transformations that the country needs done. What is going to happen with the new people who have joined the group? The belief is that some of those people, if you get the structure of reforms done, if these people have access to education, if these people have access to at different legal economies within the country. If they have access to health, if they have new opportunities brought up to them, they won't necessarily stick to doing the legal economies in which they are done.

Dr Andrei Gómez-Suárez: Now, that said, we all need to be realistic that if we look at the 2016 peace agreement that is one of the most successful peace agreements in the world in terms of reintegration of former combatants. Even this peace agreement had a number of 10% of the FARC combatants, less than 10% had gone back to take up arms. And together 10% of probably 5 to 7% of those never gave up their weapons. So it is unrealistic to think that every single member of the ELN is going to give up their weapons. But what is possible is to create a socio political economic process for the large sector associated with the ELN to move into an idea that arms are not needed in order to fight against the Colombian state.

Dr Andrei Gómez-Suárez: And I think that's a real possibility now, despite the tensions that exist within some fronts of the ELN in the country.

Richard McColl: And we need to talk about the front that is one wing of the ELN in these, this group. And it's not widely known outside of Colombia or outside of, I would say, academic circles or peace building circles, this group is very close to signing up to, let's say, I wouldn't say a peace agreement, but an agreement in that the AID and the government, the aid entities and the government will move in with an integrated project in the region to promote a sustainable economy, health care, education and communication. Of course, for an area that has traditionally been overlooked in Colombia. Do you see this as happening or is it something that the ELN in Cuba or Venezuela might sabotage?

Dr Andrei Gómez-Suárez: That's a really important question. And let me try to answer this from a different perspective. The idea of a negotiation in Nariño is not only or the solution of peace building in Nariño is not only connected to the Frente Comuneros del Sur. So it is one part of the puzzle. But it would be a mistake to look at the negotiations between the Frente Comuneros del Sur and the Colombian government as an isolated process. Okay? Nariño is part of the second phase of total peace. I would call it that particular way, because in the second phase of total peace, what you are talking about is territorialization of peace. So you want to go to the regions and you want to look at the whole region as a laboratory where you can build sustainability, sustainable peace. And in Nariño, there are three armed groups.

Dr Andrei Gómez-Suárez: Least at the moment, you have the ELN with the Frente Comuneros del Sur. You have the Segunda Marquetalia and you have the Estado Mayor Central, two of these groups, former dissidents of the FARCC. And so when we are thinking about the territorial approach in Nariño, we need to take into account those other groups and we need to take into account something else. And is the governor of Nariño. So this idea of territorial peace in Nariño is being the political flag of the governor of Nariño, who is part of the Pacto Historico, who is the same political party of the President of Colombia. So there is a really important political dimension that connects the idea of a peace policy from Bogotá with the peace policy of Pasto Inarino. And those two things are connected.

Dr Andrei Gómez-Suárez: And what they have seen is that the Frente Comuneros del Sur is ready to start a negotiation process with very concrete steps to think about disarming and reincorporating in Nariño, doing restorative gestures with the communities, and actually moving and helping the local government to do structured reforms to overcome poverty and marginalization. Could the ELN at the national level sabotage this? Yes, indeed. I mean, that's one of the main concerns, because the Direction Nacional of the ELN and the COSE are not very happy that this Frente Comuneros del Sur has decided to splinter from the ELN and take their own path connected to the regional dynamics. What does the Colombian government have to offer to the Frente Comuneros del Sur and to Nariño in general has to offer security conditions.

Dr Andrei Gómez-Suárez: Security guarantees that these other groups are not going to come into the territory and start killing former combatants, as has happened with some of the members of the FARCC who reincorporated into society. So this means a comprehensive approach in which human security from the side of the Ministry of Defense is brought into the region connected to the un I guess an international monitoring mechanism to make sure that these groups do not enter the territory and make sure that the Frente Comuneros del Sur and Segunda Marquetalia, who has also expressed interest on negotiating with the Colombian government in Nariño and start a peace lab there, can do a multilateral agreement that connects Frente Comuneros del Sur, Segunda Marquetalia and the local government.

Dr Andrei Gómez-Suárez: I think that's the way how we should start thinking about Nariño, because he's challenging this idea of parallel negotiations with different groups that is happening at the national level. And he's sort of saying multi actor negotiations with structural transformations on the ground.

Richard McColl: In this particular moment, it's multilateral territorial negotiations. I can see that it's A mouthful and the complexities leap out ahead of us. I think we need to move on to. Because you've mentioned the Segunda Marquetalia and you mentioned the emc, which is the Estado Mayor Central. These are two dissident groups, those who didn't sign up, members of the FARCC who didn't sign up to the peace Accords from 2016, and some of those who returned to arms post peace accord. And they're making moves in these areas too. But I, if I'm not mistaken, the Estado Mayor Central, the EMC has been on again, off again negotiations since September last year. And the Segunda Marquetalia has just announced, I guess about a week ago that they are sitting down with the government. So this is positive, but we don't hear this positive news.

Richard McColl: But are these, I mean, these are people who had the opportunity to sit, sign up under the very complete peace accords. The point has written down and decided in Cuba, in Havana, Cuba in 2016. Why should they then receive, let's say, better circumstances this time around after having turned it down in 2016?

Dr Andrei Gómez-Suárez: Well, we don't know if they are going to get better circumstances. Let's start from there. This is already, I would say that's what a person from the Centro Democrático probably will be saying. We don't know. We really don't know. Now let me take into pieces because probably for your listeners it's important to understand the huge difference between these two groups. The Estado Mayor Central or EMC did not sign the 2016 peace agreement. Most of their leaders became a splintering group, just like the Frente Comuneros del Sur is doing now in Nariño. They became a splintering group of the FARCC before the final agreement was signed. The reason for that was because they didn't agree with the idea of handing over the weapons before the structure reforms that the state had promised were done.

Dr Andrei Gómez-Suárez: So they thought that it was too sooner to give up the weapons as soon as they sign up the peace agreement. So what they said is, we don't trust the state, we're going to keep our weapons. Now this was a small group of the FARCC, the Frente Primero. That was the splintering group had only 400 members. The Colombian state thought at the time, we can actually dismantle them in no time. We can destroy them very quickly. And one part of the peace agreement was that the government committed to dismantle any illegal armed groups that stayed in the territory that represented a threat to the former combatants of the FARCC. Now during the Duque presidency, they went from 400 to 3,500 fighters. They spread across the whole country, and they became a serious security threat that could not be defeated militarily at that point.

Dr Andrei Gómez-Suárez: So when you cannot defeat a group militarily, what do you do? You try to open negotiations because the humanitarian suffering is too high. So what the first peace commissioner of Petro did was to explore if there was a political will of these groups to start a negotiation process with the Colombian government. And that process started. He saw the political will. And what happened in this negotiation was that they were trying to bring together different factions that had been fighting against the Colombian state, but they were not really. They didn't have the time to become very solid in terms of their union, because it takes years for a group that is spread over the whole territory to create a line of command that is very clear and centralized. So the negotiations started.

Dr Andrei Gómez-Suárez: And as the negotiations started, some of the fronts were not 100% committed with some of the bilateral ceasefire measures that were asked by the government and that created a tension within the fronts. And the government in the middle of the negotiations saw that there was a split of the EMC between two factions. One that said, we are not willing to de escalate, we want to see more of the structured reforms of the state. And the other one that said we want to stay at the negotiation table and we are willing to de escalate the armed conflict.

Dr Andrei Gómez-Suárez: So now, in this particular moment, the Colombian state is fighting a full fledged war against one of the factions of the EMC in southern Colombia, in Cauca, Valle del Cauca and Nariño, and is at the negotiation table with the other faction of the group that is mainly in Catatumbo and the middle Magdalena valley. So that is 40% of the EMC are still at the negotiation tables. And I think in this particular moment that we are talking, they're starting the sixth cycle of negotiations with this function of the emc. Now. That's it. Sorry, I just going to move to the Segunda Marquetalia quite quickly. The Segunda Marquetalia is led by Iván Márquez. This is really important to understand. Some of your listeners might remember this name because Iván Márquez was the chief negotiator of the FARCC in the Havana negotiations.

Dr Andrei Gómez-Suárez: And he signed the peace agreement in 2016. But he left the reincorporation process. He laid down his weapon and he was going to become a senator of Colombia, but he left the peace process because now, according to a research done by the un, there was a strategy carried out by The CIA and the Colombian prosecutor office to try to get them to entrap them and get them and extradite them to the US to extradite Iván Márquez to the US So he felt that he didn't have judicial security and went up and take up arms. And he's been fighting since 2019. And he called his group Segunda Marquetalia. He has also tried to build up alliances with different groups across the country. He's mainly based in Venezuela, but he has built up alliances with two groups, one in Nariño and one in Putumayo.

Dr Andrei Gómez-Suárez: And he's the leader of that coalition of groups. The Segunda Marquetalia started negotiations with the first peace commissioner of Gustavo Petro two years ago. But it took two years to build trust between the Segunda Marquetalia and the Colombian state. And what we saw last week is that finally the first round of negotiations, formal negotiations between the Segunda Marquetalia and the Colombian government have taken place. And it seems that is in the second phase of total peace. Under the second peace commissioner of Gustavo Petro, there is much more attention paid to the design phase of the negotiations. And for that reason, we are seeing a very clear timetable of clear measures that are going to be monitored for this peace process to move faster.

Dr Andrei Gómez-Suárez: My expectation with the Segunda Marquetalia is that we are going to have a faster negotiation than the one that we have had with Estado Mayor Central and the ELN because the political conditions are better and because it took a longer period of time of building trust between the parties and working on the design of the negotiations behind closed doors. And this is because, of course, Iván Márquez is perhaps one of the Colombians who has more expertise on negotiating with the Colombian state. So he knows what it takes and probably he's to going got a really important invested interest in these negotiations working with Gustavo Petro.

Richard McColl: How big is the Segunda Marquetalia?

Dr Andrei Gómez-Suárez: We know that today they have around 1,700 fighters in arms spread in these three regions of the country.

Richard McColl: And I mean, you mentioned of course, that Iván Márquez is there with his team in Venezuela. We are all watching for the elections on 28 July in neighboring Venezuela. And how this, I mean, inevitably somehow Colombians, Colombia's peace paz total will be affected. I think. I think we can say that the regime of Nicolás Maduro has tacitly approved or permitted the, you know, most of these armed groups within its territory return in some way or another. And if Edmundo González gets in as well, if he's allowed to get in, I mean, there's. That's a whole different conversation that I'll be having with a Venezuelan expert before long. But, you know, they will be expected to try and erase these groups as well within their territory, cost them out.

Richard McColl: It's there are so many threads to be pulled here that it is a concern, but rather than talk about it quickly. But I know that, I mean we have other groups in Colombia as well. Of course we do. And the biggest, most effective, most I would say damaging group presently. And I'm very reluctant to say that they are, you know, descended. They are distant distance relatives to what was the outer defenses. They belonged with the AUC and then the Aguiles Negras and then the, and now we call them the Clan del Golfo or the Gaitanistas. This is a, this is a mafia group that runs through the country and controls, you know, people trafficking, drugs, arms, anything, extortion. How does a government negotiate in paz total, you know, alongside these other groups?

Richard McColl: How does it, how do you negotiate with this illegal entity that is financially viable?

LatinNews: This podcast is brought to you by LatinNews, the leading source of political and economic news and analysis on Latin America and the Caribbean since 1967. Access LatinNews’ full portfolio of reports at www.latinnews.com.

Dr Andrei Gómez-Suárez: That's a great question, but just one thing in terms of Venezuela, because I think you made a really important point there. We think that getting the negotiations done with Segunda Marquetalia is a good, is a win solution for anyone who is in power in Venezuela. You don't want these groups to continue, strengthen themselves because they don't obey to Maduro. That's a simplistic reading. When you have illegal armed groups, they create their own dynamics and they become a very serious threat to the governability of a country. So I think that getting these negotiations done is a win for everyone who is involved in this. And that's the reason why Venezuela has played such an important role. If we think about the negotiations with Segunda Marquetalia, Venezuela, Cuba, Norway are the three countries that are the guarantors of the negotiations. Venezuela has been absolutely fundamental.

Dr Andrei Gómez-Suárez: So we don't expect a radical shift if a new government comes in Venezuela. What we expect is that probably there will be more pressures to get the negotiations done quickly. And I think the parties have started to pay attention to this for that reason. The second cycle of negotiations with the Segunda Marquetalia is going to be in Cuba the second week of August. So you always have an option to move the negotiation table from one country to the other to make sure that the Political conditions in those countries do not affect the cycles of negotiation. And the same is happening with the eln. As we know, the negotiations do not take place all the time in the same city, but usually move between Havana and Caracas.

Dr Andrei Gómez-Suárez: And in some cases, the negotiations with the ELN have been taking place in Bogotá and with Estado Mayor Central. The same actually, with Estado Mayor Central. Most of the cycles of negotiations are taking place within Colombia, in Bogotá or in some of the regions heavily affected by the armed conflict. And this is a really radical departure from the strategy of negotiations of President Juan Manuel Santos, for example, where he was constantly negotiating outside Colombia and people in the regions felt really disconnected from the peace process. They felt that only the guys with the arms were in the negotiations far away from the regions where the conflict was happening. Whereas with total peace, what the people in the regions feel is that the negotiations are happening right there in the doorstep. This happened with the EMC in Tibú, in Guaviare.

Dr Andrei Gómez-Suárez: The same has happened with the ELN in Bogotá when they launched the participation process with civil society. So I think this is something that is really important for your listeners to understand of a radical departure from the negotiations with Santos. What has happened with the Clan del Golfo is the government has tried to engage in negotiations with them following the example of. Of whom? Well, following the example of Alvar Uribe, former President of Colombia, we have had negotiations with paramilitary groups already. We had negotiations with them in 2003, in 2006, and a particular legal framework was created for that. Petro has tried to engage with them with these inheritors of paramilitary groups, with Gaitanistas, with these weird group that has been evolving ever since 2008. Now, the main obstacle, there are many obstacles.

Dr Andrei Gómez-Suárez: But one of the greatest obstacles was the last Prosecutor General, not the new, but there was a prosecutor General who put all the sticks on the wheel in order to try to lift the orders to capture them, to capture the voceros of the Clan del Golfo, to sit in negotiations with the Colombian government. That was the first problem. And now the second problem is that there was a law to try to bring these criminal groups into Colombian society or ley de sometimiento and the Colombian Congress did not approve it during the first year of the presidency of Gustavo Petro. So the Clan del Golfo, these inheritor paramilitary groups, feel that they don't have a legal framework that makes these negotiations serious, a possibility.

Dr Andrei Gómez-Suárez: And so now, with the arrival of the new Peace Commissioner of Gustavo Petro, we know that there is still some discussions going on behind the closed doors. But this is mainly about thinking how these people, what are they going to do with their money? What are we going to do with their structures, with their connections with the political, economic, legal elites in the regions? And what are we going to do in order to avoid the recycling of violence from one generation to the other, because the youth in those regions do not have any other opportunities that join in these groups.

Dr Andrei Gómez-Suárez: This is not about thinking huge structural reforms in Colombia with these groups, but it's more thinking about what are the practical steps that need to be taken in order to dismantle the groups and to deal with the illegal money that was made through this. And there is willingness of some of these groups, at least we have heard some of the leaders of the clan del Golfo saying that they are willing to sit down with the Colombian government to think about a way out of the war in Colombia. But these are the challenges that we're facing at the moment.

Richard McColl: And then finally, as we sort of address taking the multilateral territorial peace within Colombia, there is an urban peace approach as well. And this is also part of that territorial practice, because cities such as Medellin, very well known for its problems in the 90s 80s, they still exist to this day, but are very well publicized. Improvements take the headlines, but then you've got a city like Buenaventura on the Pacific coast, which is known for all the wrong reasons and is a terribly violent place. So the government has an urban peace approach as well.

Dr Andrei Gómez-Suárez: Yes, I think that's again, perhaps we're writing this report that we will publish in early August, a report jointly written between Rodemoisel Dialogo, justice for Colombia, and the University of Winchester. And one of the key findings of this report is that one of the incredible innovations of the total peace policy is that for the first time connects urban peace with rural peace. And if you think about the negotiations between Santos and the FARCC, it was all about the marginalized territories of the country. It was about creating the special territorial spaces for development in 170 municipalities far away in the margins of Colombia. But there was no discussion about the role of the cities.

Dr Andrei Gómez-Suárez: There was no discussion about what do we do with many of the people who have been affected by the violence in the margins and who have moved up to cities like Bogotá or Medellin or Buenaventura, and what do we do with those former combatants that never disarm or demobilize, but actually decide to move into the cities, and by moving into the cities, create gangs. And how those gangs in A way are connected with some of these big illegal armed groups. Because if you cannot dismantle the Gaitanistas without understanding the connections of them with some of the gangs and combos in Medellin, it is an absolutely important thing. You cannot solve the problem of ELN and EMC and Clan del Golfo in Valle del Cauca without understanding how they interact with Buenaventura.

Dr Andrei Gómez-Suárez: So the key innovation of this total peace policy is we have to start an urban peace approach, and we need to synchronize that with the urban level. And so they prioritize. The Petro government prioritize three cities to start, like, pilot projects. The first was Buenaventura, where they started with a ceasefire or a truce between two of the combos, Chotas and Espartanos, and that reduced the levels of homicide in 60%. There was a moment in Buenaventura where the homicides, in a whole month, more than two months, as far as I remember, was zero. So they showed that they have an incredible control over. Over the violence of the cities, okay? And in Medellin, they have managed to start a space of what is called socio juridical dialogue, because these are non negotiations in terms of thinking about the groups as if they were insurgencies.

Dr Andrei Gómez-Suárez: But this is about thinking about the combos and the gangs that are in the cities as actors that need to be sort of brought back into society by finding ways of dismantling the structures. But in the case of medellin, you have 17 guns, voceros of gangs, you know, spokespersons of gangs, sitting in a negotiation or in a space of dialogue with the Colombian government, thinking about how they can not only reduce the levels of violence in the city where homicide was reduced in 60%, but actually thinking about how the structures that have been created through organized crime can be transformed into peace infrastructures that allow the city to have this other illegal structure that keeps the levels of violence low. And then the other city is Quibdó, where the gangs are very different. They are very small gangs. They are mainly like neighborhoods gangs.

Dr Andrei Gómez-Suárez: They are starting to get connected with Mexican drug cartels. They are starting to get connected with the eln, but they are still very small groups where people, the young, have joined because they don't have education, they don't have the minimum access to food, they are starving there. So the gangs are a way of creating an identity, solidarity. And so the idea was, let's focus on Quibdó and let's try to solve that problem before it becomes too big. Now, the main problem that we have and we decided to close is that it is a lot of work for one office, the office of the High Commissioner for Peace, at the same time, dealing with this and at the same time dealing with the other peace processes is a lot.

Dr Andrei Gómez-Suárez: And it's a challenge because also most of the times, when you think about how we deal with gangs in Central America or in places like Medellin, is being done through the local governments. And when you have local governments who are not really connected to the peace policy of the government, like in the case of Medellin, you really have an institutional blockage there. How do you overcome something like that is a tremendous challenge. And at this moment, some of these negotiation tables with the gangs are stuck, are a bit frozen. And that's the main challenge that we.

Richard McColl: Have legal issues that prevent, of course, needs to be an agreement between those two sides within the government. They see that as being almost more conflicting than the gangs themselves dealing with the national government. But now, that said, so, I mean, the feeling I get as we wind this down, the feeling I get is you genuinely believe that there is a light at the end of the tunnel for a lot of these negotiations being, for the most part, they are again, as you say, prepared to negotiate. They come to the table with knowledge of negotiation. And it's not the biggest group, but it would be a huge success story to be able to say, listen, the Segunda Marquetalia is no longer a belligerent force within Colombia.

Richard McColl: But, I mean, do you feel that the next two years of Petro's presidency, he can pull off some big wins?

Dr Andrei Gómez-Suárez: In the report that we are writing, that I just mentioned, we are making some recommendations. We think that he can be, you know, produce incredible results in the next two years. He won't solve the armed conflict in Colombia. We don't think that you could get to a point in which you sign final peace agreements with the eln, with the emc, with the Segunda Marquetalia, with the Clan del Golfo, and you get all these cities sorted. But what you can do is unleash a process that is irreversible. And we believe that there is a really important transformation already taking place. It's already taking place, but there is a need to make some important efforts to make sure that this total peace policy delivers.

Dr Andrei Gómez-Suárez: I would say that two of the main obstacles that we have identified, and you mentioned this at the beginning, Richard, is public opinion, because what we see is that probably all these things that I've been sharing with you are mostly Unknown to Colombians. And the political opposition has won the narrative war. So they have imposed a discourse that shows that under total peace, security is worse in Colombia than before and is a total is something that has not ground reality. We've seen some indicators, traditional indicators of security and violence, that show that levels of homicide in some of the places have been reduced and that overall the trend of direct violence is going to down. Okay? But one thing is what the indicators tell you and another thing is the perception of society. And the perception is society is created by.

Dr Andrei Gómez-Suárez: By media, by mainstream media. And public opinion is fundamental, because if you don't get the cities to understand the progress that you have done, you are going to get people in the cities voting in order to punish Petro because they think that the country is worse off than before. And if you don't have four more years of a government that is committed to continue with a total peace approach, that is willing to continue with the negotiation tables that already started and with some of the structural process of transformation in some territories that have started, what you're going to get is a full fledged conflict around the corner after 2026.

Dr Andrei Gómez-Suárez: So that's the second point that we are trying to say and we think is one of the biggest challenges for the Colombian government is you need to find a way of shaping this national agreement around the importance of total peace. And that requires humility from the side of the president and the willingness to weave together a coalition with sectors of the left, the center and the right, as Petro did, to be elected himself in 2022. But the question is it possible to do something now that he knows that he's on the way out and who is willing to, from the center and from the right, to join forces to protect the idea of finally closing the armed conflict in Colombia? And one point that can bring people together, in particular the Santistas.

Dr Andrei Gómez-Suárez: And let me just say this because it's something that we have totally overlooked in this conversation, is one point that can bring people together is the implementation of the 2016 peace agreement. And that's the other pillar of total peace. Because Total Peace does recognize that one of the main reasons why we have the reproduction of the conflict in Colombia and the recycling of groups is because of the lack of political will of the Duque administration to implement the peace agreement and left a humongous problem that now, of course, for Petro, has been very difficult to undo. But the political will to implement the peace agreement is there, despite all the obstacles.

Dr Andrei Gómez-Suárez: And I think that can bring Santismo Together, Patrismo Together and other sectors to try to see if between 2026 and 2030, that is the last four years of the 15 years of the implementation of the peace agreement become an opportunity to close the armed conflict in Colombia for good.

Richard McColl: That's a lot to think about in this conversation. Perhaps you could just tell us the name of the report that's coming out in August.

Dr Andrei Gómez-Suárez: It's going to be called Two Years of Total Peace Challenges, Opportunities and Recommendations.

Richard McColl: Okay, well, please be sure to send it our way because it sounds like for people like myself, absolutely obligatory meeting discussing peace in Colombia. But actually it's been really informative chatting to you and they and hopefully we can share more of the information about what is going on behind the scenes in Colombia and away from the headlines. And that's part of the idea of this podcast, a deep dive into subjects, topics taking place in the region of Latin America. So let me take this moment to say thank you so much to Andrei Gómez-Suárez, who is a senior researcher at the University of Winchester and general director of the Anglo Colombian Peace Building Organizing association called Rodeemos el Diálogo. And they have a joint report coming out in August with Rodeemos and justice for Columbia and Winchester University. So watch this space.

Richard McColl: Thank you again everyone for listening to the LatinNews Podcast. I'm Richard McColl, your host here in Bogotá, Colombia. Please subscribe, share and talk about the LatinNews Podcast

Outro: You’ve been listening to The LatinNews Podcast. For more news and analysis on Latin America and the Caribbean, visit www.latinnews.com.

Dr. Mónica Serrano is a Professor of International Relations at El Colegio de México and an Associate Fellow at the International Institute for Strategic Studies (IISS). Her research focuses on security, drug trafficking, organized crime, and human rights. She was the founding Executive Director of the Global Centre for the Responsibility to Protect and has held senior positions at CUNY and Oxford University.

Dr. Serrano has taught at Oxford, the Institute of Latin American Studies, and the Università degli Studi di Milano. Her publications include "Human Rights Regimes in the Americas" (2009), "Mexico’s Security Failure" (2012), and "Verdad, Justicia y Memoria" (2023). She serves on editorial boards for Conflict, Security and Development, and Global Responsibility to Protect.

Intro: Welcome to The LatinNews Podcast, a fortnightly deep dive into key developments from across Latin America and the Caribbean. Here's your host from Bogotá, Colombia, journalist Richard McColl.

Richard McColl: This is The LatinNews Podcast. I am your host, Richard McColl, here in Bogotá, Colombia. I'm on the line to a very special guest this week, Mónica Serrano. She is a professor of international relations, the El Colegio de México. She's a member of the board of the United Nations University. She's worked extensively in the fields of academia and security, violence, human rights, of course, in Mexico, Colombia and the whole region. But thank you so much, Mónica, for your time and coming on The LatinNews Podcast.

Dr. Mónica Serrano: Thank you, Richard. It is an honor and a pleasure to join you.

Richard McColl: It's our honor and our pleasure. Now, if anyone has not been aware of what's been going on in the news, well, the Mexican electorate made history on Sunday, the June 2 by electing the country's first woman president, Claudia Sheinbaum. And she triumphed in what we can only say is a landslide victory. But there are so many different questions that come from this. She is the president who has won the greatest portion of the vote in Mexico since Mexico entered its democratic transition. She's the first woman president and the woman president of Mexico to also to be able to declare that she won by the greatest margin as well. So this landslide has put her party, AMLO's party, so López Obrador's party, Morena, into a really powerful position.

Richard McColl: I think the first thing that we need to ask you, Mónica, is she going to step out from AMLO's shadow? This is what people have been predicting, that she is very much AMLO's candidate. But is she her own president?

Dr. Mónica Serrano: Let me first start by saying what I see as a positive lessons and the positive sides of this election, and I think the turnout very clearly indicates and it's manifestation of the citizens interest in the election and the democracy in Mexico, as important as that is the conduct of the elections as well, which to a large extent depend on citizens participation. Those who are in the polling booths are citizens. Those who count the votes are citizens. So that is something that has to be really reckoned with and has to be acknowledged. Claudia Sheinbaum effectively won with a landslide, 59.4% of the votes, nearly 36 million votes, compared to the 27.9% of the second candidate, also a woman, we have to say Xóchitl Gálvez.

Dr. Mónica Serrano: So it is a difference of nearly 32 points between one and the other two women who bravely ran for candidates, the victory of Claudia Sheinbaum came as a surprise to many, not the victory itself. I have to clarify, I think most political analysts, the markets included, had already acknowledged that the victory will go to Claudia Sheinbaum. But it is the margin that came to a surprise and that is keeping political analysts and experts still puzzling and trying to come up with answers. And I think that is where your question fits. If Claudia Sheinbaum is somehow under the shadow of AMLO and López Obrador is partly because of the way the election took place, with the president intervening.

Dr. Mónica Serrano: The president in fact, very much acting in the old PRI canon with a new, if you would like, a new modus operandi or way of applying the dedazo, but in the end, really having chosen her and decided that Claudia Sheinbaum had to be his successor. So that is where the question as to whether Claudia will be able to be herself. And I think that paradoxically, the landslide victory puts her in a more difficult position because had she not won with a qualified majority in the Chamber of Deputies, that is now, I think, a given. There are still questions about the Senate and there are questions as to how Morena will claim and demand the distribution of the last bit of seats.

Dr. Mónica Serrano: There is a clause that states very clearly that the party winning the majority of votes cannot go over a certain limit and they are prepared to go over that limit. They have already being clear about that in Mexico City. And how they play that card in relation to the Senate is still to be seen. But the fact of the matter is that by approaching the qualified majority, she has less of an excuse to keep a distance or to keep her own views in relation to what AMLO has already set as an agenda, which is the number of constitutional reforms that AMLO has already flagged, which include a number of very tricky policies and decisions that will impact the institutional landscape of the country and of democracy significantly.

Richard McColl: What I think is a good place to start as well is AMLO laid out this 20 point reform agenda in February. 18 Of these reforms are constitutional reforms and involve measures such as the elimination of a proportional representation of seats in Congress and the direct voting of Supreme Court justices by popular vote and the elimination of regulatory agencies. So we're talking about the popular the potential for major constitutional changes that are now more likely to pass. And I get the feeling with that one month changeover. So the new Congress, with its strengthened Morena bench, is sworn in on September 1st and Claudia Sheinbohm is not inaugurated until October 1st. So that gives AMLO one month to basically, I would say, push through absolutely everything he wants to do. Is this something that you believe will happen?

Dr. Mónica Serrano: Well, he has already sent the signals that he's prepared to do that. He's again published the latest agenda for the 18 constitutional reforms. He's very clearly indicated that should be the course of the deepening of what is called in Mexico the fourth transformation, to which, by the way, Claudia Sheinbaum, in the course of the campaign committed herself to very clearly to many of these changes and policy decisions, including the popular election of judges and ministers of the Supreme Court. There are other agendas in which she has kind of indicated or flagged a more moderate position, including in terms of the reform of the judiciary and the Supreme Court. She's already said that it has to be debated in a public parliament kind of way, suggesting that she's not necessarily running.

Dr. Mónica Serrano: But you are absolutely right in stating that to the extent that the new Congress will in fact start operating on the 1st of September, that gives AMLO a whole month to rushed these constitutional reforms and to proceed with his radical agenda for change. I think September will be a very tricky month and a very interesting four weeks to look at how the relationship between the exiting president who has been one of the most popular presidents in Mexico, that to be fair, he does not end in a note of approval much different to predecessors. With the exception of Enrique Peña Nieto, the approval rate of López Obrador is above 50%, which is not very different to the approval rates with which Fox or Calderon ended. Zedillo, the one president who ended on a highest note of approval.

Dr. Mónica Serrano: But what places López Obrador in a very particular light is the absolutely low approval rate with which Peña Nieto ended 25%. So the perception of López Obrador and the approval rate is not insignificant. But the elections as well, I think are being perceived as a plebiscite on his government is not only the victory of Claudia Sheinbaum as a running candidate, but also the approval of the electorate of AMLO's government. And I think it will be very tempting for him to rush these reforms, but it will be very difficult for Claudia Sheinbaum then to assert her own ground if López Obrador decides to act in that way and not to allow the new government to be the one who processes and takes these decisions.

Richard McColl: I have a quick side question on that because it is interesting to see how popular López Obrador, you know, he's exiting this position and this role on a high note. To what can we attribute his Popularity amongst the electorate.

Dr. Mónica Serrano: Well, there is in fact a puzzle and a puzzle that does not help explain the electoral results. And that is that while his popularity remained high with as low downturn in 2020, but then he recovered swiftly, the approval rate, as I say, is high, but the approval of his policies in particular security, shows a very clear contract. The majority of those polled show a clear disapproval in terms of the security policies that were pursued under López Obrador, to which Claudia Sheinbaum has also. Committed herself. But again, that is where it's difficult to pin down Claudia Sheinbaum, because as mayor of Mexico City, her security policies contrasted clearly with the policies pursued by AMLO at the national level. So the approval rate, I think is clear.

Dr. Mónica Serrano: But there is this paradox with a disapproval of his policies and yet a landslide victory for Morena, Claudia Sheinbaum and AMLO.

Richard McColl: Well, I mean, as we said, the landslide victory for Claudia Sheinbaum and obviously second place Gálvez is a huge victory in itself for, let's say, women's rights and exposure in a country of great violence and of course, gender based violence as well. And that leads us really into this security question in which you were talking about. You say that she's kind of, she contrasted definitely as mayor of Mexico City in terms of her security policy, but will she continue a policy of hugs, not bullets across the country? Will we see her blindly pursue López Obrador's policy on that?

Dr. Mónica Serrano: I think that is going to be hard on a number of fronts. The first that you have already mentioned is the US factor and how the US Factor plays out. It will depend on the pressures coming from the White House and that will in turn depend on the US Elections and whether Biden or Trump end up in the White House even under the democratic government. We've seen some changes in the policy of abrazos, no balazos, of López Obrador, and the continuation of old policies, including the arrest or killing of big drug traffickers, as well as the extradition of some of them. The latest one of the security men of the Cartel de Sinaloa just a few weeks ago. So the US Factor will indeed be something that we will need to take into account to assess the security policies of Claudia Sheinbaum.

Dr. Mónica Serrano: The problem that she has is that the policies that she implemented in Mexico City are policies that are not easily replicated in other parts of the country because of lack of resources, because of the nature of the city with a population that has been voting and governed by the left and Supporting left policies for a long period of time now, where technology plays an important role, where the size and the strength of the police force is unique in terms of the country and contrasts with other places in Mexico where either police is non existent in some municipalities or where police corps do not go above two policemen in some municipalities. So that makes it difficult the perspective of replicating the agenda or the policy approach. The security policy approach in Mexico and other parts of the country is not easy.

Dr. Mónica Serrano: There is of course, the dimension of federalism, which also means that her margin of maneuver to export policies to other states or cities in the country will have to take into account that dimension, which would involve negotiating with governors. Having said that, we have to take into account that Morena now will be governing the majority of states in Mexico, with the exception of Guanajuato, Coahuila and Jalisco, the majority of the country is now purple Morena or guinda dark red. That means that there can be in principle more coordination that could help a security policy than has been the case in previous sexenios where the difference of party color has been a factor undermining security cooperation. So as to security, I think she said that the National Guard will continue. She has made very clear that the military will continue to play a part.

Dr. Mónica Serrano: How she will make use of these resources, I think it's something that we will need to wait and see. I think her commitment to social policy and the use of social policy as an input for security policies is likely to continue, not least because of the positive record that those policies showed in Mexico City, where the deepening of social policies in certain neighborhoods, targeting in particular young boys, young men, played an important and were perceived to have helped the security equation. So how she really tweaks these policies at the national level will be something that we have to wait and see. But it's going to be a major challenge because where you have already systems of criminal governance very rooted at the local level, the capacity of these policies to make an impact will be, I think, something to be tested.

LatinNews: This podcast is brought to you by LatinNews, the leading source of political and economic news and analysis on Latin America and the Caribbean since 1967. Access LatinNews full portfolio of reports at www.latinnews.com.

Richard McColl: On the one side that Morena is governing, I think it's 24 out of 32 Mexican states that on the one side this could be open opportunities for communication and opportunities for collaboration, as you say, and on the other side, but as you say, the criminality so deep rooted in some of these areas and so few economic opportunities, then there's a huge challenge as well. I mean, nothing's going to be smooth sailing, we know that. But the challenges really do exist. And I think we should probably discuss just a little bit the potential for the elections in the US coming up November 2024. Now, interestingly, former President Trump had a reasonably good relationship with López Obrador. And, you know, it's one of those things that sort of beggars believe and you get the feeling that President Biden has, you know, a decent relationship.

Richard McColl: But what can we see? What would we think between Claudia Sheinbaum and either one of these potential presidents?

Dr. Mónica Serrano: I think that if we see continuity in terms of a democratic government in the US it will be more easy to see a continuation. Which doesn't mean to say that it's going to be easy because the pressures are there. And we are seeing how in the context of the elections, Biden is tightening migration policies, limiting the number of people who are allowed into the US to claim asylum. And that puts a hell of a lot of pressure on Mexico on border, on northern border cities as well as in the southern border, and the expectation that Mexico helps contain the migrant flow increases. So that is something that will be there, that will probably be dealt with in a more civilized way through dialogue, less through open direct threats. But the pressures will be there with Trump.

Dr. Mónica Serrano: I think even if we in retrospect can see that López Obrador political talents allowed him to exercise huge self restraint, not to respond to the provocations of Trump, which I think was a big factor in their report, and the way in which AMLO went at great lengths also to pay compliments to Trump, whether he really believes them or not. We'll have to wait for historians to be able to delve more deeply into that. But I think those were the kind of ingredients that allowed for the kind of less confrontational relationship than one would have expected between Mexico and the US Under Trump. Claudia Sheinbaum does not have those attributes. She's a very disciplined politician, very organized. She's a kind of technocrat. But she's not someone who really has the charisma that López Obrador was able to display.

Dr. Mónica Serrano: She doesn't seem to have the patience or the slow pace of interactions to which AMLO is prepared and I think acted as an advantage to him when dealing with Trump. And that is something that we'll have to wait and see. The other thing is AMLO had in Ebrard a very competent politician as a foreign minister in bilateral dealings, perhaps not so much in how he handled the foreign service and Mexican foreign policy in general, but in terms of a crisis management approach. Ebrard was certainly a very competent, savvy politician. And so far, the names that have been mentioned for the foreign policy agenda and Mexico's international relations I don't think have the type of experience that Ebrard had. And even a broad he was exposed later on by Trump and the memoirs of some of Trump members of Trump's government.

Dr. Mónica Serrano: So I don't think that the ingredients that were there to try to mitigate or to try to soften the roughest side of potential US Mexican relation under a second Trump are necessarily there.

Richard McColl: Yeah, this is what is being stated in much of the media at the moment as well, and a lot being pointed at Claudia Sheinbaum perceived inability to be as, how would you say, politically savvy as López Obrador, as you suggested. I'm, I'm curious as we start coming towards the end of our conversation here, there's a lot of negativity coming out. There's a lot of negativity in certain areas of the press and it usually comes back down to the economics. You know, on June 7, economic media sources in Mexico were reporting that the peso fell more than 7.5%. It's worst in four years. And then there are other suggestions that a continuation of López Obrador policies, obviously with the super majority that Sheinbaum now has in Congress, it revives concerns of a further deterioration of the country's macroeconomic fundamentals.

Richard McColl: I doubt that anything really is going to change in the rest of, in the economy for 2024. But the downside risks, they are, they're kind of growing or they're suspected for 2025. I'd love to hear your views on this.

Dr. Mónica Serrano: Yeah, well, one of the things that I failed to mention that explains the election is the massive amount of money that López Obrador dispersed among it is believed as many as 35 million homes, not people, but families. And the sums of money that families received have been estimated to go between 5,000 and 11,000 pesos, which is roughly between what, nearly 500, up to $500 a month. And the other characteristic of this disbursement of money is that unlike what was the case in previous administrations, which was institutionally channeled, this money was channeled through a new institution created by López Obrador that clearly established a connection between those enrolling the people to receive the grants the pensions, the transfers, and Morena and López Obrador. So there is a kind of almost personal perception of these social benefits, which is really mere populism.

Dr. Mónica Serrano: And Morena and López Obrador, which in turn were responsible for a significant increase in the deficit, in the public deficit. It is true that a lot of this money has come from what are called fideicomisos, kind of special trust and budget lines of budget that were sitting for emergencies, including natural disasters, and they were diverted for these purposes. How Claudia Sheinbaum will continue funding these transfers, which are at the bottom of what holds Morena together, It's a question. And even before we put this question on the table, I think many are persuaded that a fiscal reform has. Long. Been due in Mexico. It's been debated for decades now, and that there is no way she will be able to continue with this type of policies that help keep Morena afloat without a fiscal reform. So far she said no fiscal reform, but I think she will have to confront that sooner rather than later. As I said before, it is a kind of negative result to have won with such margin of landslide, both because of the way in which López Obrador can push the reforms that will make markets uneasy, but also because of the way that landslide commits her to continue with this course of policies and reduces perhaps her ability to fine tune some of these. The markets have been interpreted as in fact reacting to these. Landslide victory. markets had already accepted that she was most likely going to be the winner.

Dr. Mónica Serrano: But it was the landslide that made markets uncertain and wobbly. How she will deal with all these, we'll see. And a big factor will be the discipline within Morena, because the discipline within Morena has been very much kept together by the AMLO factor. And without AMLO being there, what we will have are currents, which I think is what is perhaps the one thing that makes Morena fundamentally different from the PRI. Beyond all the similarities, including the. I think there is a lot of. Including the migration of PRIistas to Morena, the number of PRIistas governors, you name what. But one fundamental difference is that the PRI ultimately rested on a corporate structure that is too eroded over time.

Dr. Mónica Serrano: But there was there a kind of corporate structure that kept the PRI together and allowed for different policies to try to create some semblance of discipline in Morena. What we have, I think, are currents. It's a mix of groups and political factions, including Ebrard, Sheinbaum herself, and what is considered to be the more radical part of Morena, Ebrard, Monreal, So how the discipline will play out and how Sheinbaum will be able to recreate some kind of image of discipline will be also very important in terms of how the markets behave and how the economy reacts.

Richard McColl: Absolutely fascinating that this, the. Yeah, the drop in the peso is down to the. Down to the landslide. You'd think, you know, a landslide would keep it level, but of course, you know, these things are different. I think we'll wind this down. We'll wind this down. I have one final comment. I was going to ask if Morena had become the new PRI. But you've already answered that. But my final question, obviously, and a lot of investors, a lot of around the world and businessmen are listening to this and they are interested in the issue of Pemex. And for me, it remains to be seen whether the continued nationalist approach that Sheinbaum intends to implement, if it will turn Pemex into a financially healthy company, you know, the gun. The country has bailed out Pemex over and over again.

Richard McColl: Is it possible that she will heavily. She'll continue. Continue to heavily subsidize Pemex for three years and start a gradual transition into renewables, which is far more, let's say, her background.

Dr. Mónica Serrano: She's indicated that clearly if there is one policy area in which she has clearly departed from amlos preferences and track record of policies is in renewable energy. How she manages Pemex. Anamlo. Anamlo's commitment to this nationalist energy agenda will have to see. I think she's also while showing commitment to renewable energies and as I said before, this is not really my area of expertise. But I think there are reasons in terms of how under the PAN government's energy decisions, including with investors in particular from Spain, were taken and the corruption that accompanied those deals. I think that is a factor that clearly plays a part in her commitment to keep a state predominance in the energy sector. But that does not necessarily mean that she will continue with a fossil kind of policy agenda that we saw under AMLO.

Dr. Mónica Serrano: As I said, she has indicated her readiness to move towards renewables. In the campaign she showed off how she. Well, being mayor of Mexico City, she took the decision to install solar panels in one of the biggest public market in Mexico City. So she's signaled that's her intention and I think that Pemex needs to be looked at and some tough policy decisions will need to be considered. How that will be played out, we'll have to wait and see.

Richard McColl: Plenty of challenges ahead for President elect Claudia Sheinbaum. Let me take this moment and say thank you so much to Mónica Serrano, who is professor of international relations, the El Colegio de México. She's a member of the board at the United Nations University and has worked in academia regarding security, violence, human rights in Mexico and in the region. Thank you so much for your time and your insights in what promises to be an incredibly, well, I would say, colorful few years ahead for Mexico.

Dr. Mónica Serrano: Thank you, Richard. It's been a pleasure to talk to you.

Richard McColl: The pleasure has been all mine. We've been here for The LatinNews Podcast. My name is Richard McColl, your host here in Bogotá, Colombia. Please remember to subscribe, share and talk about The LatinNews Podcast. Thank you again for listening. We'll be back in a few fortnight with further interviews from experts in the region. So goodbye.

Outro: You've been listening to The LatinNews Podcast. For more news and analysis on Latin America and the Caribbean, visit www.latinnews.com.

Chris Dalby is the author of "CJNG - A Quick Guide to Mexico's Deadliest Cartel", the first in a series of guides to the most dangerous organized crime groups in the world.

Chris is the founder of World of Crime, a think tank investigating organized crime. As a journalist, he has reported from over twenty countries on five continents. As a consultant, he has helped governments and non-profits make sense of urgent criminal challenges. He has worked in Mexico, Brazil, China, Malaysia and now resides in the Netherlands with his wife and two sons.

Intro: Welcome to The LatinNews Podcast, a fortnightly deep dive into key developments from across Latin America and the Caribbean. Here's your host from Bogotá, Colombia, journalist Richard McColl.

Richard McColl: This is The LatinNews Podcast. I am your host, Richard McColl here in Bogotá, Colombia. Our very special guest this week is author and analyst Chris Dalby. He's in Maastricht, but we're going to be talking to him about Tren de Aragua. Now, this is a Venezuelan criminal syndicate that is spread throughout the Americas, well, Central and South America. And we're going to ask all about it because he is the director at World of Crime and author of World of Crime, Guides to Organized Crime. Most recently his book on the Jalisco Cartel New Generation is out, an an incredibly well researched and very readable book about, well, the Jalisco cartel in Mexico. So, Chris, welcome on The LatinNews Podcast.

Chris Dalby: Thank you very much, Richard. It's an absolute pleasure to be here and thank you for the invitation.

Richard McColl: No, it's great. I mean, first and foremost, let's start with the very basics. How have you decided to basically write up books on organized crime all around the world? I mean, it's a, That's a huge undertaking.

Chris Dalby: It is. So obviously at the beginning, I'm focused on Latin America, which has been my home for many years, and my area of study, particularly organized crime. I used to be the managing editor of InSight Crime for five years, which, you know, if you want to have a crash course in how to do criminal investigative journalism, that's really the best place to do it. And I'm incredibly grateful to the wonderful people in that organization. World of Crime and the Guides to Organized Crime came from a question that I got over and over again in different ways from policymakers, from law enforcement, from academics, which was, where do we start? Because when you tackle an organized crime group, I think everybody understands the need to understand how each organized crime group differs from everybody else. Right.

Chris Dalby: It's very easy to fall, as perhaps some members of Congress have recently in the generalization of, you know, all cartels are terrorists, all cartels operate in the same way. And that's not true at all. So the Guides to Organized Crime are short, but very well, very condensed thematic guides to how groups came to because we want to humanize them. We want to tell the human stories behind the violence and the headlines, how they operate, how they make money, who leads them, and really the threats to national security they represent. We started with the Jalisco cartel because it is by far the biggest security threat To Mexico and in many ways to the United States and now Tren de Aragua. Much smaller group, much less well known internationally. But if you talk to people in South America, it's the pervading topic of conversation.

Chris Dalby: Whether you're in Chile, Peru, Bolivia, Colombia, Venezuela, Ecuador has other problems right now. But in many countries in South America, Tren de Aragua is, you know, maybe the main security concern.

Richard McColl: It's, it's a fascinating group and I think we can see the same sort of, let's say, tentacles of its, let's say commencement, its beginnings. It started in or it was being controlled from a prison, the Tocorón prison in Venezuela to begin with. And of course we can draw similar between. Was it the Primeiro Comando da Capital in Brazil? You can look at what's going on in Ecuador, you can look in Colombia as well. I mean, how did this start? Let's get, let's get a real basic. Let's get, you know, come in at the first floor here.

Chris Dalby: So there are similarities at the ground level, obviously we see numerous Latin American and Central American countries. This failure to control prisons. Prisons become breeding grounds for sophisticated gangs, right, because that's where the gang members can meet. That's where different specialities can interact. That's where new members can be recruited. That's where a level of rules and politics and governance can be established which can then be replicated outside the prison. So you are correct, starts as a prison gang in Tocorón, which is one of the largest prisons in Venezuela. And that is similar to the PCC in Brazil or similar to some of the prison gangs in Ecuador or even if you look at the MS-13 and Barrio 18 in El Salvador, although there are large differences in how these groups operate.

Chris Dalby: The big difference is that there is no other state at the time that Tren de Aragua started. So 10 to 15 within the last 10 to 15 years. There is no state in South America which is as openly criminal as Venezuela. So where you always have a little bit of to and fro in terms of corruption and collusion between politics and organized crime. In Venezuela, it's overt. And so very quickly instead of trying to shut down these groups or take them out early, it's about how do we control them. It's about how can we use them as an extension of the state to carry out things or to profit in ways that openly we're not able to. And the Chavista regime in Venezuela is very good at doing that.

Chris Dalby: Both Chavez, but especially Maduro have perfected a system of narco favoritism where Specific gangs can be allies for a while, then enemies at another moment when it's less politically convenient. And that can be run either at the municipal level, at the state level. The governors in Venezuela are very powerful or even at the federal level.

Richard McColl: So if we talk about narco favoritism, I mean that's a term that I would love to hear more about. Does this then draw up a conflict between Tren de Aragua and then maybe what we know slightly less about the Cartel de los Soles or I mean, because I know that recently Yván Gil, who is the sort of chancellor in Venezuela was saying that the Tren de Aragua is a fictional story created by the international media, just like the Cartel de los Soles. So where do we stand?

Chris Dalby: I mean, Cartel de los Soles is a controversial term. I think it's an accurate catch all term to describe the criminal political connections within the Venezuelan politics and military. The Cartel de los Soles is not and never was a single structure with a boss and capos. It is a collective term to refer to all of the connections between crime, politics and military in Venezuelan. So you can refute it to a certain extent because you can say, well, it's not a cartel, it's not an organization. That was never the intention of the name. Cartel de los Soles irrefutably a criminal gang with traditional hierarchical connections with a leader that we identify with the base of operations that we identify with criminal modus operandi that we understand and criminal economies that are very well defined.

Chris Dalby: I mean we've arrested, they have been sending arrested connections between capital de los Solis and Teneragua. I think it's a term I'd like to move away from because it's again, it lends credence to this idea that the Venezuelan state apparatus is controlled in a very solid way. It's not. There are myriad different connections and groups and organizations within the Venezuelan state that run their own criminal operations. They're all to a certain extent approved by Maduro and certainly as in all these things, you pay your cut up. But one of these connections could be removed or one of these organizations could be removed if the person in charge pulls afoul of authorities without threatening the rest of the connections. So very early on we see Tren de Aragua as very quickly they emerge as a very powerful group.

Chris Dalby: The name Twinder Agua seems to have been a homage to other Venezuelan gangs like 10 Deliano. So the word Tren is often associated with criminal groups in Venezuela with a very strong identity to One part of the country. So Trendeliano or tendera one. But Tren de Aragua, within a couple of years, becomes a model on how to quickly grow a criminal gang. The level of control they had in Tocorón, I don't know of many examples, if any, in Latin America where a gang had complete control of the prison. This was not a case of bribing the guards or bribing the director to look the other way. This was a case of controls the prison utterly. I mean, in. In a very sort of headquarters kind of way.

Chris Dalby: Members can leave the prison with impunity to sell drugs, to commit assassinations, to whatever mission, maybe, and return. The prison is a safe haven more than it is a penitentiary. Okay.

Richard McColl: And we will move on into this spread. Of course, we can identify that. The expansion of the Tren de Aragua. Well, it's.

Richard McColl: It's.

Richard McColl: It's been facilitated by the diaspora, the Venezuelan diaspora, The millions of Venezuelans, of course, they're not all affiliated, but the millions of Venezuelans leaving Venezuela. So as you mentioned at the beginning, there are strong influences in Colombia, in Peru, a small one in Ecuador, but Chile and I think some influence in Brazil as well. But what we're seeing in the news, of course, is what is happening in Peru and Chile, where they've kind of been. I think they've been declared sort of national security threat, enemy number one in those countries. Tell us a bit more about that.

Chris Dalby: So we know the old adage that criminal. That criminality is the most adaptable business in the world's identification of the Venezuelan diaspora and how it could be criminalized is perhaps the most successful criminal innovation in South America in a generation, I would say, since the advent of the cocaine trade from Colombia to the US that is the most lucrative new rapid expansion that we've seen into a new criminal model. I'm in no way praising them because they're monsters. I would also like to emphasize that the overwhelming majority of Venezuelans leaving the country are seeking a better life elsewhere, are moving for horrific reasons of political and economic poverty, and should be welcomed as such or should be treated with dignity. A very small percentage are criminals.

Chris Dalby: The Tren de Aragua quickly identified that the Venezuela to Colombia border was where most of the Venezuelans were seeking to cross without papers or the documentation to do so, and could therefore be exploited. So they take over what are called as trochas, these illegal or these. These illegal crossings between Venezuela and Colombia. This is where we really see that expansion starting. And so families are. Or individuals are extorted. They have to Pay a price to cross the protest controlled by the Tren de Aragua. And slowly that begins to expand. The Tren de Aragua begins to force people to carry contraband across the border or sexually exploits vulnerable. This brings them into conflict with gangs like the ELN or the Rastrojos, who were also at the time active along that border for similar reasons. This is the Tinder.

Chris Dalby: I was changed from being just a very sophisticated criminal gang to being an armed gang. And this is a big evolution for the gang. Right before in Aragua, in the part of Venezuela where they're from, yes, they were known for murder for hire, they were known for rampant extortion, but they were not necessarily a well armed force. That expansion to the Colombian border forces them to begin looking at arms trafficking, to begin recruiting more members. Because now they're facing, you know, groups with decades of armed experience like the ELN in Colombia. They don't go for full clashes with ELN because that's not a fight they want to pick and it's not a fight they would have won at the time. Instead, they move quickly and they begin setting up these factions, these franchises in other parts of the country.

Chris Dalby: So Venezuelans go to Bolivia, to Peru, and then later to Chile, which at first was very welcoming to Venezuelans. So hundreds of thousands of Venezuelans go to Chile, and Tren de Aragua goes right along with them. They then begin to set up these networks again with not necessarily many members in each country, but they have the networks to identify and criminalize and victimize these thousands, if not tens of thousands of Venezuelans moving across South America. Again, that maximizes the income coming in, and it maximizes the. You can, you know, you can charge them at every border. You can make them, you can make them take contraband across every border, drugs across every border, based on what the country you're heading to needs or demands or want. So Tren de Aragua becomes these criminal journeymen.

Chris Dalby: And that's the first example of the Venezuelan criminal gang really expanding in that way. Now, six, seven years after this process begins, they've laid down roots, and they've laid down roots particularly strongly in Chile and Peru. And those routes are extortion, sexual exploitation, and local drug trafficking. The Tren de Aragua is not associated with international drug trafficking like the Medellin cartel, but they do increasingly look at Venta. So local drug trafficking, what we call micro trafficking, for a long time that is still controlled from Tocorón. So we know that these factions, if they are Tren de Aragua, and often Venezuelans who are arrested are accused of being 10 without much proof that they are. That's another thing to talk about. Are sending money back Tocorón enriching Niño Guerrero, the leader in. In Tocorón and his cabal of. Of lieutenants. In the last year everything changes.

Chris Dalby: In September 2023, Maduro or the. The. The Venezuelan government raids Tocorón prison smashes this institution, this complete control and I mean Tocorón prison had a swimming pool, gyms, nightclubs, shops, a baseball field, a concert hall, a playground for kids, shops openly selling drugs and all that gets taken out. Why? We're not exactly sure. There are many rumors or many speculations as to why. But what we do know is that the leaders of Tren de Aragua are warned ahead of time and managed to escape. So Niño Guerrero is now on the loose, we don't know where. And the Tago's operations outside the country continue to thrive.

Richard McColl: Why did it. Why did they. Why were they able to settle so readily and I would say with ease in particular Peru and Chile.

Chris Dalby: Well, Venezuela does not cooperate openly with other countries, does not share information unless it's highly pressured to. So the expansion of Tren de Aragua was something that caught Peru and Chile perhaps a little bit less Colombia, but still off guard. They were not. They I think in the early days did not have access to information about how the Venezuelan diaspora was being criminalized. Until you start seeing the spike in murders in northern Chile, until you start seeing the rapid rise in arrests in Peruvian and Chilean cities linked to extortion, murder, sexual exploitation. And the name Sendago becomes to. Begins to appear again and again in arrest reports. So I think the. Those countries learned about Narago when they were already in the country, so had stolen a march on authorities in those countries.

Richard McColl: So they were already settled. They're already embedded. I find your. I find the comment the point on this raid in September 2023, the raid on the Tocorón prison. Of course this is coming at the same time as the sort of. As everything's going on in El Salvador with Bukele. So this was in part inspired, you think?

Chris Dalby: I do. There are many. We don't know exactly why the Maduro government decides to take Tocorón. For the last several years the Venezuelan government has been trying to reclaim prisons and insert them into a new model. And it had taken many of the more violent prisons. It had arrested many of them of the. Or taken out many of the more powerful pranes, as we call prison bosses in Venezuela. But Niño Guerrero have been left alone despite Being the most famous pran in the most famous prison, heading the most famous gang. So what triggered that raid? We don't exactly know. A couple of things do give clues though. One, the political protector of the thing that I got was Tareck El Aissami.

Chris Dalby: One of the most famous politicians in Venezuela, former vice, former governor of the state of Aragua, former vice president, former minister for oil. In 2023 he falls from grace. He was seen as a potential successor for Maduro. He was seen as really being his number two or certainly very close to him. He begins to fall from grace in. In 2023 during a huge corruption scandal in the oil company there. Obviously the entire government is riddled with corruption. So if somebody falls, it's because it's politically convenient for them to do so. He was arrested in April 2024 for a huge corruption. That was, that was a big moment because the thought of seeing Tareck El Aissami behind Boris was once thought unthinkable, right? He was, he was an untouchable. So it might have been that.

Chris Dalby: It might have been that Tarek Alai Sami and everything under him was no longer seen in favor. Began making a lot of noise in the wrong way in other countries. You know, a lot of bodies dropping in Chile, Peru, Colombia linked to them. The Venezuelan government may have wanted to show in a sign of good faith and I put that in huge quotation marks that they were doing something about it. But I think also the Bukele mania of mano dura had it played an impact. I think you see it in Ecuador, you see it even in Costa Rica, right? Though the question of can we do a Bukele here? No. In most countries, in perhaps in no other country in Latin America could you do the level of mano dura that Bukele has done and I think very controversially.

Chris Dalby: But Venezuela may want to show they could do something similar and wanted to show they could take out again in quotation marks their largest criminal threat. But the CORON is not. And the money laundering networks and the communication networks and the criminalization of the diaspora continue actively to this day. And we don't know when yogurt was is. So at least we used to know where he was. We used to know he was in Tocorón. Now he's in the wind.

Richard McColl: This, this, let's say jailing or holding of Tareck El Aissami is a very interesting development, as you said, unthinkable previously that he would be, you know, held up as you know, A corrupt individual. They're all, I mean, corruption is riddled. The whole, the whole regime is riddled with corruption. But it was unthinkable beforehand, would you think, I mean, perhaps if he was a, as you say, a willingly protecting the trend or El Niño Guerrero in some way. This is now a splintering of the Maduro regime a bit.

Chris Dalby: Maduro has been far more prescient than I think a lot of people thought in bringing the Venezuelan regime under his complete control is not the first regime figure to be sidelined. You know, a few years ago we talked a lot about Diosdado Cabello as being the number two. Now he's not in prison, but his power has certainly been curtailed. So no, I don't think it's a splintering of the regime. I think it's Maduro cleaning house and making sure that no one who could threaten him is still in power.

LatinNews: This podcast is brought to you by LatinNews, the leading source of political and economic news and analysis on Latin America and the Caribbean since 1967. Access LatinNews full portfolio of reports at www.latinnews.com.

Richard McColl: So when we talk about, and you've mentioned it previously as well, the sources of financing for the Tren de Aragua, as you're saying, it's the sexual exploitation, people trafficking, kidnapping, extortion, robbery and micro trafficking. And of course you've looked into this into South America, I'm sure it spreads north into Central America. How far north does this go? And of course I'm specifically saying United States does Tren de Aragua. Nicaragua have, you know, links into the US and of course beyond that into Europe.

Chris Dalby: There is no evidence of that at this time. There is speculation that given the fact that Tren de Aragua is masterful at expanding along with the diaspora and that now thousands of Venezuelan migrants are among those at the US Mexico border, that could be a way for the Tren de Aragua to enter the U.S. i don't think that is likely to happen for a number of reasons. First of all, criminal groups in Mexico are incredibly powerful and incredibly territorial and criminalizing the diasporas of any country that is coming to their country pretty well already. I'm not sure what openness there is for Cinder to do that in Mexico. Right. Without sparking a war far from home where their false projection would be minimal. Secondly, the power of, for example, the Mexican cartels in the US is again helped by the diaspora.

Chris Dalby: And again I caveat the point of the diaspora are victims of these cartels, not willing participants in their activities. But There is a colossal Mexican diaspora in the U.S. both legal and illegal, which facilitates the spreading of networks. Of course there is Venezuelan diaspora in the United States, but nothing unlike the same level, nothing like is established and not as embedded into the fabric of organized crime in the United States as Mexican organized crime. I think that would take a long time and significant efforts for Tren de Aragua and I'm not sure what criminal economy they would really be able to benefit from in the U.S. apart from extorting or forcing some of the Venezuelans into sexual exploitation. So yeah, it could happen. I know there's been a couple of arrests of Tren de Aragua members.

Chris Dalby: I have not seen any evidence of an organized cell in America and in Europe. I think even less. Niño Guerrero's brother was arrested in Spain a few months ago. I think there was a couple of arrests of Tinder, Iowa members in London. I did not look at those case files, so I don't know how legitimate those arrests were. If they were really Tender, Iowa, I think those were probably. They might have been sent to do some deal, but I think there was more likely people who are running away. There is a problem now with Tren de Aragua is that if you are a police commander looking to justify your budget or looking to tap into funds that have been unblocked.

Chris Dalby: Special Task Force against Tren de Aragua Arresting two Venezuelans who've been selling drugs and saying, oh my God, I arrested two members is difficult to prove and it's difficult to disprove. So the chances that you'll believed and that your higher echelons will also take credit for that arrest is high. And that has happened a lot. There are credible factions of Tren de Aragua in Chile, in Peru, in Brazil, in Colombia. But not every Venezuelan is being arrested at saint. That requires more rigorous investigation, more rigorous fact checking from judges and prosecutors, more rigorous understanding of what is. So I think that the doubts should not just be in the US and in Europe, but also in what's coming out of Chile and Peru.

Richard McColl: So we suspect then that potentially they'll work with, you know, the cartels in Mexico rather than to try and work parallel to them. They'll work with it. So I find it very interesting because this is a transnational organized crime group. How many, how many members are we looking at? How many num. What's the number?

Chris Dalby: So I, I always hesitate to estimate numbers of criminal groups because again, there's different types of members. You've got the hardcore nucleus, the, the original Kon and the people that they sent or that they knew were being recruited in those countries. Then you have, let's say a second level, which are smaller factions like Gallegos who are affiliated to Tendenaugua. But the connections that they have, the amount of money that they pay up to Venezuela is not fully understood. Then under that you have women being exploited, families being forced to carry drugs and often jailed for doing just that and arrested as being Tendarago members when they're utterly unwilling participants. Certainly the number of people working for the gang willingly or unwillingly is in the thousands, probably in the tens of thousands across all countries.

Chris Dalby: That doesn't mean that there are tens of thousands of hardcore Venezuelan gang members invading South America, as is sadly, all too often the image of the group that is being given.

Richard McColl: Yeah, this transnational, this trans. First Venezuelan international crime syndicate. So do you think then that they will be content to just manage within the continent itself, you know, consolidate the routes through Peru, Chile, I would say likely further into Brazil. Uruguay, of course, is very much under threat. Argentina, I would say, is probably quite open as well, security wise. Far other. Other issues pressing there. So how do you feel that this might develop?

Chris Dalby: I think now it's. This is a real test, institutional capacity because. Yes, developed a fantastic model in Tocorón where they're making a lot of money from, you know, extorting prisoners and controlling all aspects of life in that prison and in the state of Arangua. Then they expanded to the Colombian Venezuelan border and then they thought that worked very well. So we'll do it in Trinidad and Tobago, we'll do it in Peru. Where that goes next depends on Kenny so far has been remarkably strong in not falling to the Bukele, for example, not fall into mano dura, even though the country is seeing a spike in homicides, spike in kidnappings, spike in extortion, spike in sex crimes. The institutional strength of Chile at the moment is holding. Peru is more worried.

Chris Dalby: Peru, with that rotating door of presidents and a lot of political unrest that makes it easier for a gang to really sink its roots into the country. Brazil, again, the extent of Tren de Aragua being in Brazil is in Roraima in the north and selling guns. We know that they're selling weapons to Brazilian groups. An expansion further than that requires two things. One would require the diaspora to keep moving, which at the moment it isn't. It's pretty much the same routes that are being used and now the route north. So when we look at Argentina, Brazil, Uruguay, those are not countries where a massive number of Venezuelans are going, which would allow for them to expand the same way or they evolve into, you know, they find yet another opportunity to. To adapt. What that would look like, I don't know.

Chris Dalby: The big, let's say, gap in Tinder I was criminal portfolio is their lack of involvement international drug trafficking. Right. This is, you know, they're not the farc. They're not the. They're not the Medellin cartel sending drugs north. At some point, you begin to think, okay, if you're. If you're. How can I next monetize the routes that I control? I'm not. There's no indication that they're going in that direction. But obviously that's a glaring gap in there in their criminal resume. I think one of the big areas now that they control is weapons trafficking. I think that is underestimated as a source of income for Sendido, because all the countries that we've listed, maybe, except Chile, are vulnerable to weapons trafficking. Other gangs in the region need those weapons. They have connections in Brazil, in Venezuela, in Colombia, to get weapons.

Chris Dalby: So that could be one area. And I think the second thing is extortion. Extortion is becoming an incredibly important and underestimated tool for criminal gangs across South America. In my book about the Jalisco Cartel, I talk about how the Jalisco Cartel moves into an area and extorts every single pestle they can from established industries, everything ranching, tequila, hotels, anything they can. Seeing Tren de Aragua move in that direction, I think is quite likely. We know already that it has extensive extortion networks in Venezuela. In Bogotá, increasingly seen as a major threat of extortion in Bogotá, in Quito, in several cities, in. In Chile. So settling in, nailing their place in those cities, expanding their extortion networks, I think is step one, and that's already happening. Step two, I would imagine gun trafficking is a potential earner for them.

Chris Dalby: Step three, this is complete speculation that international drug trafficking king might look mighty attractive at some point given the routes that they control.

Richard McColl: Yeah, and that's step three. When you say about the international drug trafficking, you did mention Trinidad. Trinidad and Tobago, of course. Its proximity to Venezuela is obviously very attractive. I could see it. I mean, with the. I could see definitely with the chaos in the Caribbean right now, obviously I'm pointing at Haiti, that could be a definite expansion. And, you know, you look at the other islands nearby Curaçao, I know they're small, Aruba. And did these, you know, lend themselves to definite sort of, let's say, criminal colonization?

Chris Dalby: The Venezuela to Caribbean criminal connections is one of the leading edges of criminal research in the area. I know InSight Crime is doing excellent work on this tender, I guess has connections with Trinidad, as do lots of other little criminal groups in Venezuela. Cocaine is sent through the Caribbean route from Venezuela. Human trafficking is huge. Weapons trafficking happens, piracy happens. The way that works is not fully mapped out. That is something that is being worked on, I know by several organizations. So Tren de Aragua's expansion to the Caribbean seems obvious. The problem there is that you run into on the Dutch side, you know, some institutional strength in Curaçao and Aruba. Obviously those islands have been used for drug trafficking. But you do run into European and American surveillance networks that patrol the Caribbean. Right. So it's not necessarily that easy.

Chris Dalby: Trinidad, we know, is open to organized crime on many levels. Local gangs in Trinidad Tobago, local gangs in Venezuela do collaborate. That network exists. And we know Venezuelan presences in Aruba encoresao. But it is limited in terms of migrants going there. In terms of there is some surveillance, there is some institutional strength there to block that expansion.

Richard McColl: So I mean, aside from, let's say institutional strength in these countries, uncorrupted judicial system and so on, what can be done in Chile, in Peru, in the country so affected by the trend, Aragua,.

Chris Dalby: The major gap right now in terms of their agua knowledge. And I know that there is an effort to work on that in the region. But of course, Venezuela is not playing ball, is follow the money, right? Mexico is willing to play ball and follow the money. When it comes to the cartels. Venezuela isn't. So it's. It is difficult to understand where the money goes inside Venezuela because the major. There's a major player that doesn't want to play. There was an example where one of the number two or number three in. In a guy called Larry Changa was in Chile. He went to Chile in 2020, in 2018, I believe, and was set up several businesses there, killing authorities began to track him, identified who he was and was trying to follow him. Before they could catch him, he left the country.

Chris Dalby: But they were tracking financial movements between him and Chile and going back to Venezuela. That's always the start, right? Rather than dropping bodies or doing a kingpin strategy and trying to kill the leaders, Follow the money, find out where the network based from that. That really is actionable intelligence. The second thing, and I think there's a case right now happening in Chile which is hugely important. It's the case of Los Gallegos. Los Gallegos, probably the largest faction of that was positively identified as being from them in Chile. I think over well over a dozen members are currently on trial. It started in April in Chile. That trial is going to be hugely important both to see the evidence that Chile has about how Tren de Aragua groups operate in the country, two, about what evidence is revealed and three, about the sentencing.

Chris Dalby: Because I think when we get to that we'll understand how important, how influential those members were. What we haven't talked about is the other power base of which is the Bolívar mining zone in Venezuela. Right. There is credible evidence to say that Niño Guerrero has probably fled there specifically to a region known as Las Claritas. There is a leader of Tren de Aragua or at least a very close associate of them called Johan Petrica, who some say is the actual leader of Tren de Aragua. There's always some discussion about whether it's Niño Guerrero or Johan Petrica. It's not necessarily very useful because it's complete speculation. But he operates a mining game in the Bolívar mining area of Venezuela. This is a very remote, very lawless, very violent area of Venezuela.

Chris Dalby: We know that the regime takes money or is at least paid off by the gangs who control this area. There have been clashes there between the army and certain gangs to try and take over some of these possessions. So it's very murky what the relations are between these mining syndicates, as they're called, and the regiment. But yo and particular controls one of the most powerful syndicates in that area. It is a member or very close associated to Tren de Aragua. And that nucleus of gold mining provides them with another base of money. It is another center for drug trafficking, for illegal gold mining, for sexual exploitation which has not been fully explored. So Tocorón has been taken out, but that Bolívar mining area remains a hugely important financial boost for the game.

Richard McColl: That, that is a very interesting topic that we don't hear about. We do hear about the eln. So the National Liberation army, let's say the last remaining official guerrilla group, leftist guerrilla group from Colombia, started in 1964 or thereabouts. We do hear about them providing like protection to mining interests in Venezuela. So you could imagine a full on violent campaign between the two groups up there. It turned out I were interested in kicking out the eln.

Chris Dalby: The relations between the ELN and the government have been very complex. They have. They have clashed, stopped and clashed and stopped repeatedly for the last five, six years. Right now. What the ELN presence is in Bolívar, I'm afraid I don't know. I haven't heard of any violence between the and the thing that, and again, the Tren de Aragua presidency is very specific to that part of. They certainly have interests in other parts of the country, but that control of gold mining is very much a Bolívar Las Claritas. I mean, it's one of the richest gold mining areas in South America. The money coming out of there is in the millions, but so has been very good at having different nuclei of revenue. Right. So you have Tocorón Prison and the local town of San Vicente, which they control. You have this gold mining area in Bolívar.

Chris Dalby: You have the Colombian Venezuelan border in Las Trochas and then you have operations in Peru. They are very good at decentralizing their operation. Right. So if any one pillar falls, it doesn't threaten the entire edifice, even if it's on the scale of Tocorón.

Richard McColl: Very interesting indeed. So, Chris, remember, remind us when your book on the Trend will come out and be available for listeners in.

Chris Dalby: English and span and it'll be under the World of Crime banner.

Richard McColl: So let me take this moment to say thank you very much to Chris Dalby. He is the director at World of Crime and of course the author of World of Crime Guides to Organized Crime. October, you heard it here. The book will be released. It'll be available for all of you, those interested. It's called Trend A Quick Guide to Venezuela's First Cartel. Right now, the latest book released by Chris Dalby has been the Jalisco Cartel New Generation. I have read it myself. It's a very comprehensive view of the cartel in Mexico. So and again, if you are interested in this topic and these topics, can I please recommend you go over to World of Crime Guides to Organized Crime.

Richard McColl: And let me say, Chris Dalby, thank you so much for your time and sharing what seems like a bottomless pit of knowledge on this subject.

Chris Dalby: Thank you very much, Richard. You're much too kind.

Richard McColl: This has been The LatinNews Podcast this week discussing the trend from Venezuela's first international crime syndicate. We've been talking to Chris Dalby, the director of World of Crime and World of Crime Guides to Organized Crime. I've been Richard McColl here in Bogotá, Colombia. Thank you again. And we'll be back in another fortnight with more topical conversations about the region. So thank you again.

Outro: You've been listening to The LatinNews Podcast. For more news and analysis on Latin America and the Caribbean, visit www.latinnews.com.

Recognized as a top economist and advisor on the Caribbean, Marla has led discussions and published reports on the Caribbean implications of EU Blacklisting, COVID-19, BREXIT, and changing US and Chinese policies, among other geopolitical developments. Marla has taken a firm stance on resolving the constraints and the injustices that the Caribbean faces that directly hinder growth and constrain the region from achieving its socio-economic potential. Her monthly Caribbean Economic Report has become a critical input for regional monitoring, closely following risks, vulnerabilities, and opportunities for growth. As a highly sought-after keynote speaker internationally on Caribbean issues, she regularly advises private sector executives and multinationals to support their strategic decisions in the region. Marla served on the Government of Barbados Jobs and Investment Council, is a Member of the Advisory Board to the UNDP's Regional Bureau for Latin America, and Board member for the Caribbean Policy Research Institute (CAPRI). She sits on the Board of Directors of RF Holdings and of Goddard Enterprises Limited.

Intro:

Welcome to The LatinNews Podcast, a fortnightly deep dive into key developments from across Latin America and the Caribbean. Here's your host from Bogotá, Colombia, journalist Richard McColl.

Richard McColl:

This is The LatinNews Podcast. I am Richard McColl, and this week we're going to be discussing Jamaica and we're going to talk about Jamaica's, well, quite meteoric change when we think about its economy, the strong growth that has taken place recently, low unemployment, healthy public works program, reduction in debt burdens. It's quite, well, it's quite impressive. So this week's expert is none other than Marla Dukharan. She is a Caribbean economist and advisor. So welcome on The LatinNews Podcast.

Marla Dukharan:

Thank you so much, Richard. I appreciate your invitation to be here.

Richard McColl:

Well, the honor is mine, of course, but, well, let's move over to Jamaica. I know you travel all around the region. I know at the moment you're in the Cayman Islands, but you are a Caribbean expert and you are fully equipped, more so, I would believe, to talk about Jamaica. Perhaps we could go straight into the economy because those points that I mentioned previously, they must be attracting investors. And to what can we credit this turnaround?

Marla Dukharan:

Well, I think, you know, you must have hit rock bottom. The only way is up. And I think that appropriately describes what happened to Jamaica in 2011. 2012, Jamaica had hit rock bottom from a balance of payments crisis perspective. What does that mean? It means they basically ran out of foreign exchange to service their debts and also to pay for their imports, and they had no foreign exchange. The government had at that point in time engaged the IMF on numerous occasions and agreed to various reform programs under the auspices of the IMF. And each time they had failed to meet their requirements and their side of the agreement, basically. And therefore, the IMF had to step away and not offer the financial and technical support for the reform process that they had agreed to provide.

Marla Dukharan:

And then Jamaica again found itself in a situation where, okay, I hit rock bottom again. They then reached out, as they would normally do, the government, that is, to all of the banks, to say, I need financial support. Could you lend me money? And the bank said, you know what, we're tired of this because we keep lending you. Your debt to GDP is now 147%. You have a primary fiscal deficit, which means you're borrowing to pay interest on the existing debt that you have. You're obviously in a highly unsustainable fiscal position and we will not lend you this money unless you agree to go back to the IMF. Unless you agree to stick to the terms and conditions of a program and unless you deliver results as a result of the program. This is all well documented.

Marla Dukharan:

And also I had an interview some maybe a year ago with Keith Duncan, who is the CEO of JMMB. But he's a very important character in this whole, as you put it, meteoric change in Jamaica's socioeconomic trajectory for the past 12, 14 years. Because he chairs a very important institution in Jamaica coming out of this rock bottom crisis that they hit in 2012. It is called the Economic Program Oversight Committee EPOC. So EPOC. So when Prime Minister and the Minister of Finance came to the bank and said, I need your support, and the banks pushed back and said, no, this is where we draw a line in the sand to say you need to adhere to some terms and conditions.

Marla Dukharan:

And what they did was the bank, that is, they formed this EPOC, this committee that consisted of banks, consisted of private sector civil society, the IMF, the multilateral development corporations and institutions, even members from the government themselves, to basically oversee and hold the government to account for the reform program that it agreed to embark on, to get the financials or the fiscal support that they needed from the banks and also from the IMF. So this EPOC exists, it continues until today. Every quarter, the government feeds information data to EPOC around its fiscal performance, its economic and monetary performance. And EPOC then looks at performance relative to the stated policy agenda, the stated goals that the government has for itself in terms of fiscal goals, monetary goals, balance of payments, et cetera, the legislative reform agenda that they had articulated, et cetera.

Marla Dukharan:

And it reports to the people. And this is actually. So if you take nothing else away from this conversation, take this away. What they did was they implemented this mechanism for public accountability where this EPOC receives information from the government on its performance, assesses the information, and reports publicly to the people, literally on the street corner, in the rum shop, on a quarterly basis, also on social media and audio, also written on their website, report publicly to the people of Jamaica and by extension the domestic and international investors on the performance of the government vis a vis its targets. Nobody else does this, nobody else in the Caribbean holds itself to account publicly for what it says it's going to do. Sorry, you were going to say something.

Richard McColl:

Well, I think that's incredible. I think very progressive indeed to post or to announce, as you say, in the rum shop on the corner. And the people take to this. The people have adopted this as normal. Now, they enjoy hearing this every quarter.

Marla Dukharan:

I certainly do. I mean, I Can't speak for the Jamaicans, but from what I can tell, it would appear that it is now part of and parcel of their culture. I think from what Keith said in the interview that I did with him, of course, there was significant resistance and pushback from the Civil service on being held to account for delivering on what the government articulated was its plan. Because, of course, you know, governments come out and announce a fiscal budget every year, and then next year they come and they do the same thing, and they don't say, well, this is what I said I would do last year, and this is what I actually did. And this was. This is the gap, and this is why I didn't achieve some of these goals. Nobody does that.

Marla Dukharan:

Even the government itself, you now have a mechanism, it's supporting that kind of accountability. And of course, the Civil Service, you know, members of the civil service pushed back and said, you know, you're naming and shaming me. But I think they stuck with it. Government needed financing, excuse me, so was forced to continue to support this level of transparency and accountability. And then it became a habit. It is now fully, I would say, an ingrained institution in Jamaica and a part of their culture. And so what that also did EPOC it is. It also gives a level of transparency around what were the reforms that Jamaica implemented in order to achieve the, as you put it, meteoric results that they have achieved. And so, for example, they've had massive institutional reform.

Marla Dukharan:

And remember, Richard, we in the post-independence era, 1960s, 1970s, we in the Caribbean inherited institutions that were extractive in nature because our colonial masters designed these institutions for rent, seeking for extraction to take back to Europe. And when we inherited these institutions, we did not engage any kind of institutional reform that was necessary to ensure that these institutions are now fit for purpose for our socioeconomic development journey that we embarked on, because it wasn't designed for a socioeconomic development, those institutions. So what Jamaica has done is what we all should have done. So they did it in the last 12 years. They should have done it in the 1970s. But anyway, better late than never. When is the right time to plant a tree? 20 Years ago and today, Right? So they did what all of us should have done.

Marla Dukharan:

They reformed their labor market laws, they reformed their central bank, they reformed the way the exchange rate is managed, they reformed the way the fiscal budget is managed. So they have fiscal rules that they adhere to in terms of debt size, deficit size, et cetera, and limits on those things. They reformed almost everything you can think about. And so what they've done what Jamaica has done. And I guess this is the untold story, because all everybody hears is Jamaica has the lowest unemployment they've ever had, or Jamaica has the lowest poverty they've ever had. But what I think people don't hear and don't understand is that what underpins all of these outcomes that we see in Jamaica is very deep and sweeping institutional reform. And that is what, remember there's this book, I forget how to pronounce the author's name, why Nations Fail.

Marla Dukharan:

And they talk about what separates a failed nation from a successful one is the institutions that underpin that society. And that's exactly the case in Jamaica.

Richard McColl:

Incredible. So you'd say then, as I say, you strengthened the institutions. And this has been a cross party policy to allow this because you can imagine there's been some pushback as well.

Marla Dukharan:

Well, the thing about parties in this region, I think that is also not widely understood is that a lot of the political characters and the political parties that developed in the independence, post independence era came from the labor movement, came from that whole desire to see our workers get better terms and conditions of employment than what existed when were still under colonial rule. And so because of that, all political parties across the Caribbean are very much. We don't have extreme left, except maybe in Cuba. But socialist democracy is something that is quite often talked about and often understood to be the ideology that the majority of the English speaking Caribbean countries that are independent adhere to that type of ideology. So I'm saying that to say that, yes, you will see, I mean, oppositions opposed, because that's what they think they're there to do.

Marla Dukharan:

So you will see pushback from and you will see one side trying to take credit for something the other side did, and you will see those kind of things. But I think by and large, both sides of the political divide in Jamaica are very similar in ideology and very supportive, even if in rhetoric they may not be. But in practical terms and in practice, they would have been supportive of the reform agenda. Otherwise we would not be where we are today with Jamaica.

Richard McColl:

Very interesting indeed. I want to just go back to some IMF figures as well that we didn't put in at the beginning. But I would say, you know, in 2012, as you said, Jamaica's debt to GDP ratio was 147%. Yeah.

Marla Dukharan:

Now what's the highest in the world at the time? From what I recall.

Richard McColl:

Now, it's 72%. And it could go in 2024, 2025, down to 68%. This is a very positive, as you say. And it's. I guess it, as you said, it's the institutional changes. I could think of a number of Latin American countries that could look to Jamaica for some inspiration. Is this happening? Is Jamaica becoming a model for the region?

Marla Dukharan:

I certainly talk about it all the time, every opportunity that I get. And I think one of the things I want to highlight. You just highlighted what the debt to GDP trajectory is. The thing is, how important is a debt to GDP statistic if you're not your social target? Because at the end of the day, Richard, the only thing that matters when any government is elected, it's elected to make the lives of their people better on average. Right? It matters not if your debt to GDP came down from 147 to 72. But your people are worse off. What Jamaica managed to do is to show that it can improve its fiscal numbers as well as its social numbers concurrently. That's what's really important as well.

Marla Dukharan:

That's the second thing I think you should take away from this, if nothing else in this conversation, that it is quite. Because we have this left leaning ideology. You had months all the time saying, well, you know, we have to spend money to grow the economy. We have to spend money for people to feel better, off to better. And that's actually not the case because we have large fiscal leakage in this region because we import 90% of what we consume. So when the government spends a dollar 10 cents at best ends up adding to GDP. So government spending is not the answer. We cannot spend our way to greatness in this region, unfortunately. So fiscal restraint is part and parcel of socioeconomic stability and success in the region. You now have a Jamaica which has zero.

Marla Dukharan:

And by the way, Jamaica and Dominican Republic are the only two countries that are consistently measuring poverty in this region. Nobody else is. They are willfully blind to the poverty, especially coming out of a pandemic, which is a huge criticism against all of them. But Jamaica is measuring it even coming out of the pandemic. The lowest poverty they've ever had and the lowest unemployment they've ever had. But that is extremely important alongside the fiscal improvement. And that's something that I think is even more laudable. And when you ask me, are other countries looking to Jamaica as an example, they like to see that happy for Jamaica and they're proud of Jamaica. But they're also quite tongue in cheek and sort of cynical about the fact that this happened under an IMF program.

Marla Dukharan:

Of course, the IMF is widely vilified and demonized by every politician, especially the ones who are on the phone with them negotiating X package. Right. So they don't like to acknowledge that it was under an IMF program, that this is what happened. And the only time I see any meaningful institutional reform in this region is under an IMF program when somebody is saying to you have to do this, otherwise you won't get the money that you need. And that's the only unfortunate thing, that we can't do this. Our politicians are incapable of doing this on their own.

Richard McColl:

And let's, I mean, you touched on it, the, let's say the colonial economic model that was inherited, let's say, into Jamaica in the 70s and the independence. I know that Jamaica is a key producer and a key provider in the bauxite market. Has this altered at all the extractive industries on the island?

LatinNews:

This podcast is brought to you by LatinNews, the leading source of political and economic news and analysis on Latin America and the Caribbean since 1967. Access LatinNews full portfolio of reports at www.latinnews.com.

Marla Dukharan:

I think that Jamaica's economic diversification has certainly evolved and strengthened in the last decade. So for example, when they defaulted in 2012, at that time remittances were earning as much or more foreign exchange than the tourism sector. And now that has changed where the tourism sector is earning more foreign exchange than remittances. So their industrial evolution for the past 10 years has strengthened, of course, again based on institutional strengthening. I think that part of a big part of why Jamaica's export sector, meaning the bauxite sector as well as the tourism sector, but they also have a thriving agriculture sector. I think one of the reasons why you would see these export sectors growing is because of how the exchange rate has been managed. So remember that the exchange rate basically prices your exports to the outside world. Right.

Marla Dukharan:

And if you have an overvalued currency, like for example, like Trinidad and Tobago, does it makes your exports relatively less price competitive, more expensive than they should be. So Jamaica implemented an inflation targeting regime that allows for the injection of foreign exchange into the market, that allows for two way movement in the exchange rate. Now they took a brave step in doing that because of course this is the expectation based on historical patterns would have been that the exchange rate, the Jamaican dollar, would just collapse. Yeah, and what happened was they did see some deterioration, or I should say not devaluation, but yeah, some deterioration in the exchange rates. And what we have seen is that it has then stabilized and it now moves in both directions.

Marla Dukharan:

So you have a depreciation and appreciation, as the case may be, given the demand and supply foreign exchange. And they now have, alongside a fluctuating exchange rate, they now have very robust foreign exchange reserves, which imparts a ton of confidence in the Jamaican dollar. But what that means, that bit of deterioration or depreciation I should say in the Jamaican dollar did a few years ago, was that it made the exports cheaper and so the export sectors are more competitive internationally and therefore doing better. It also makes for imports more expensive, which can have an inflationary impact. We did see a bit of that. What it also means is that it means it makes your domestic production much more competitive. vis-à-vis the imported products.

Marla Dukharan:

So what they did to the exchange rate I think underpins what we're seeing in terms of the export sector, including bauxite becoming much more meaningful as a part of the economic success story.

Richard McColl:

You mentioned it and we have to go towards it. It's tourism and tourism obviously being a major economic driver in Jamaica. Your Minister for Tourism, Edmund Bartlett, well, he's singing the praises of what's going on. He can't, he can't laud it enough. 2023, 2024 Predictions of US$4.38 billion coming in and growing. It really is quite incredible. I use that word a lot, but it's really quite. It leaves one speechless. I can think of other again, destinations in the Caribbean looking at Jamaica in envy. But at the same time we've got this. But I mean, we have to talk about the challenges. The homicide rate in Jamaica and the security situation. It's improved, but it could still improve further. And we looked at the homicide rate for 2023. It was 60.9 homicides per 100,000 people. That's 1,393 murders.

Richard McColl:

I mean, it's not as lawless as, say, neighboring Haiti, but figures, of course are worrying, but they don't seem to affect one another. Tourism and the security issue.

Marla Dukharan:

Well, I think when you think of the north coast of Jamaica, you know, your Ocho Rios Negril, Montego Bay and so on, which are the traditional tourism hotspots. They have a system in place where the security level is enhanced in those tourist areas. Right now, of course you have people arguing why couldn't it be like this for the whole country? And that's a valid argument. Kingston is not so much a tourist destination, but you do have tourists going there, especially to see the Bob Marley Museum, et cetera. And of course, Kingston is where a lot of these homicides take place. But a couple interesting things I want to talk about as it relates to homicide. And of course, yes, Jamaica is the highest in the region in terms of homicide rate. One of the highest in the world, as a matter of fact.

Marla Dukharan:

And the whole region of Latin America and the Caribbean has the highest homicide numbers on earth. Two things that predict, or, sorry, that reflect in your homicide rate. What's the level of gun crime? Where are the guns coming from? They're coming from the US. You cannot solve this problem without the US's intervention. There was an article recently published and it came on Compass. I can share it with you in the chat that talks about the fact that we have two phenomena with this homicide level in the region. One, that it's of a franchise nature where gangs are setting up franchises in different islands in the Caribbean. So it is truly a regional issue. And also the music culture, the trinibad genre and the dancehall genre are very much intertwined with gang culture and gang activity and murder.

Marla Dukharan:

And of course, they talk about it all the time, they sing about it, they glorify violence. And all of that is intertwined and becoming more and more part of our culture in the Caribbean. So that's worrying. So those are a couple of things I want to highlight. But the other thing I want to highlight is the fact that your homicide rate is a function of the amount of gun crime and the quality of your health care system. When in your country you can die of a gunshot wound to your toe, whereas in the US you would not die of a gunshot wound to your toe. It means that the homicide rate is also being pushed up by the weakness in your health care system. So we have to address the health care system.

Marla Dukharan:

Now remember that the Caribbean is physically trapped in between the trade of narcotics from south to North. Because the Global North are the consumers of cocaine, more so than we are in the Caribbean. We just don't have enough of us to compete with the north, the Global North, as it relates to consumption, right? And you have the guns accompanying the drugs going north, and then you have the funds to pay the growers and the producers of the drugs. You have those funds flowing from Global North to south America, largely in Latin America, through us. So then you have the money laundering problem, and again, the guns that go with the money, right? So we are physically stuck in the middle.

Marla Dukharan:

So our problem with homicide, our problem with money laundering, our problem with the crime that is related to the narcotics and human trafficking is not really a war problem. It is a problem that is South, Latin America and global north. And we are stuck in the middle. And we need those two parties to recognize their role in all of this and address it from a regional scale. So in other words, each country cannot be looking to police its own borders and with its own coast guard and its limited resources. We need to deal with this on a regional scale.

Marla Dukharan:

And the way that Colombia has been able to clean up its acting with institutional strengthening, but also with the cooperation of the United States, for example, this is the kind of intervention and solution that we need in the Caribbean, but on a global scale. So I don't want to identify this as a Jamaica specific problem. This is a regional problem, and we are the ones that actually just stuck in the middle of a problem that's much bigger than us in the Caribbean.

Richard McColl:

Yeah, yeah. I mean, as a major, as you say, a major receptor of recipient of guns from the north. Coming through, staying and moving on. And of course, Colombian cocaine coming up. Some staying and then the rest going up. When we talk about the gang culture and organized crime, is it, and I mean, is the, are the illegal industries controlled by Jamaican organized crime gangs or is it an international. We got Mexican cartels. Have we got Colombian middlemen? Who is controlling this in Jamaica?

Marla Dukharan:

Well, Richard, I'm just an economist. I'm not an expert. And so what I rely on is, you know, what I see in the press. I think that it's highly organized and it's not Jamaica specific. It is not Trinidad specific. It is truly regional and international in nature and highly organized and highly interconnected. And so that's why I'm saying that we cannot resolve this problem on a country-by-country basis. That's just my read of the situation. As a matter of fact, I'll share the article with you. Perhaps you can share it with your audience. There was an expert from CARICOM IMPACS who spoke about this as being a truly international and highly organized issue. So I will go with what he said. He's the expert and I don't see a reason to disagree with that. This is not a Jamaica problem.

Richard McColl:

Yeah, I can see that. Definitely. Well, we touched on that. On that side of challenges, we do need to talk about the economic repercussions of climate change as we wind this down. But the economic. As an economist, you can come forward with this. But the economic conditions and challenges coming from climate change and the drought that has been occurring. Could you please extrapolate a little bit?

Marla Dukharan:

Sure. I mean, this is a reality that we face in this Region that is based on the extremes of drought, on the one hand, as Jamaica has witnessed. I mean, I, here in Cayman went sightseeing the other day to find some mangrove and freshwater lakes and so on, and it was all dried up here as well. And so we do have that challenge. And then we have hurricanes that come more and more frequently. Every one dumps a lot of water on us. So we have those extremes. I think that what we haven't solved in this region is the fact that any investment that takes place, especially as it relates to infrastructure, has to be around resilient infrastructure, climate resilient infrastructure. And I don't see enough of that happening yet.

Marla Dukharan:

We don't see enough of the issue being intertwined with, for example, annual budget that a government reads. I can't tell you how many budgets I read and pay attention to across the region where they don't mention resilience at all. The word is not mentioned. They will say infrastructure, they will say public works, they will say roadworks. But you don't hear them saying we have to flood proof this zone or we have to look at how we can make sure that this area has enough water. So I think that you have to have a thorough recognition from the authorities in the region around what they have to do to solve this problem. In conjunction with our development partners, in conjunction with the multilateral agencies. Yes, but I don't see enough of that happening.

Marla Dukharan:

And so I'm saying this to say that we have a problem in this region of net outward migration on the Caribbean basis. We have 50% more net outward migration than the average SIDS globally. So small island developing states on the whole have a problem with net outward migration in the Caribbean. Ours is 50% more than the global figure. And what I think will happen, and we are probably already seeing this, is we will have net outward migration that is not just based on economics and opportunities further afield, but climate refugees, climate migrants. Because my house was destroyed, my livelihood was destroyed based on climate events. And so I have to find somewhere else to live and make a living.

Richard McColl:

So it's again, it would be in the US interest to help on this front because I would imagine the first port of call from Jamaica is to look north when you look into the climate migration. And obviously migration at this moment obviously is an incredibly hot topic. I'm here in Colombia and we look at the, you know, the Darién going up through Panama. But I know that migration within the Caribbean, as you say, is a hot topic as well. How are you? How Is Jamaica reacting to or receiving perhaps Haitian migrants? Is it? It's a big thing, a big issue.

Marla Dukharan:

I am not sure if it's a big issue in Jamaica. I know I saw recently where some ship landed, some unauthorized ship landed with a lot of Indian migrants. I'm not sure there's a huge Haitian problem. I know you have a Haitian migrant issue in Bahamas, in Dominican Republic, but I'm not aware of it being a huge problem in Jamaica. In Trinidad we have the Venezuelan migrants. So you know, it's funny that we have a migration problem of migrants coming in, but like I said, we have 50% more net outward migration of our own people. So in 10 years from now, the demographic makeup of this region could look very different the way it looks today. And the ethnic and national makeup as well can look very different from today.

Marla Dukharan:

Whether or not I see this as real challenge, I don't know that I see this as a real problem because we have an aging population problem in the English speaking Caribbean. And the countries that are not these countries that still have a population pyramid are countries like Dominican Republic, Haiti and Jamaica. Whereas the rest of us are more like this or this in terms of our population pyramids. So I think migrants are important if we want to continue seeing our economy, communities grow. Otherwise in 10 years from now, we're going to be converting schools to homes for the elderly across the region in the absence of migrants.

Richard McColl:

Nice to hear a positive outlook on migration which tends to buck the trend from where we hear all over the world that the aging population requires migration. I would say on the whole this conversation with you about Jamaica has been very positive. There are things to do, but where aren't there things to do? And this institutional strengthening and this institutional, as you say, the reform and public accountability all point to very favorable wins in the future. It's unusual to have such a nice conversation about this. Well, actually you mentioned the Dominican Republic and some months ago we did cover the Dominican Republic and that was very positive too.

Richard McColl:

But two great stories, success stories in the Caribbean, which you know, we always think and we come back obviously to the violence and the organized crime and we come back to the 1970s and the pits of despair. But it's 2024 and the outlook post-COVID and everything else is very positive. So I'd like to thank you for sharing your profound knowledge so unselfishly on this topic. It's been a real pleasure.

Marla Dukharan:

Thank you for having me, Richard. I appreciate it and I'm happy to share with you my thoughts on these things. Yes, there's a lot to be positive, especially Dominican Republic, Jamaica, Guyana, whereas the other countries in the Caribbean that we have more and more challenging times ahead, like my country, Trinidad and Tobago and Barbados, where I've spent the past six years of my life, I think those two are still and Trinidad more so than I think anybody else in the region, unfortunately struggling a lot. But yes, we do have bright spots. We do have countries that we can all look to see what they've done right and emulate that. And it's only fitting that I'm talking to you from the Cayman Islands, which I continue to say is the best run country in the Caribbean.

Marla Dukharan:

But you and I can have a conversation another day about why Cayman island is best run country in the Caribbean.

Richard McColl:

I'll keep it noted down when we need to come up with some information on the Cayman Islands. But for today, it's been Jamaica and it's been an absolute pleasure. We've been talking to Marla Dukharan, who is a Caribbean economist and advisor, and it just really has been a revealing conversation about Jamaica and the success story. I've been Richard McColl, your host here in Bogotá, Colombia, again speaking to Marla Dukharan. You can find her very easily online should you need to get in touch with. And this has been The LatinNews Podcast this week discussing Jamaica. Thank you everyone for listening and goodbye.

Outro:

You've been listening to The LatinNews Podcast. For more news and analysis on Latin America and the Caribbean, visit www.latinnews.com