LATIN AMERICA - NEWS BRIEFS – CONTENT:

Special Reports:

• ·         Chile: In the Aftermath of an Earthquake

• ·         Follow Up: The World Chimes in on Latin American Drug Policy

Economy and Politics:

• ·         New Regional Bloc Sets Tone for Clinton Tour of Latin America

• ·         Venezuela Energy Crisis Threatens Economy and Chavez Regime

• ·         Colombia Hailed as Model Democracy for Defeat of Third Term

Media:

• ·         Argentina Celebrates Surprise Academy Award

• ·         Mexican Telecom Tycoon Becomes World’s Richest Man

Tourism:

• ·         Latin America Airline Passenger Demand among Strongest in the World

Human Interest:

• ·         Shakira Joins World Bank Childhood Initiative

• ·         Village Girl Emerges as Earthquake Hero

Special Report:

Chile: In the Aftermath of an Earthquake

On February 27, 2009, a massive 8.8 magnitude ‘mega’ earthquake rocked Chile, devastating the country’s second largest city, Concepcion and triggering a forceful tsunami that left large parts of the coast inundated, hundreds missing, homes and roads in ruins, and major industries ailing.  As the country continues to suffer from strong aftershocks that disrupt recovery efforts, and the inauguration of a new president brings political uncertainty, experts scramble to assess the cost of this disaster. 

According to the Chilean government, millions have thus far been affected by the strongest earthquake to hit Chile in 50 years – the 9.5 magnitude Valdivia earthquake in 1960 remains the most powerful ever recorded on earth.   In addition to a substantial death toll (officially 528), more than 500,000 people are displaced and in need of temporary housing (Bloomberg). Coastal villages have been swept out to sea; roads, airports, and power lines destroyed; and major industries like wine-making, fishing, and tourism are struggling to recover, costing the Chilean economy millions.  The government, and disaster-scenario modeler Equecat, estimate that reconstruction costs could end up reaching $30 billion (20% of Chile’s GDP). 

The administration of new President Sebastian Piñera, the first conservative head of state in 20 years, clearly has a great challenge ahead.  As if to drive this obvious point home, Mr. Piñera’s swearing-in ceremony this past week was accompanied by a 7.2 magnitude ‘aftershock’ that prompted a tsunami warning and sent thousands fleeing into the streets.  According to a report by The Independent UK, the tremor also left dignitaries in attendance, Bolivian President Evo Morales and Peru’s Alan Garcia, visibly shaken. 

But the same report suggests that Piñera may yet benefit politically from the enormous task ahead – he enters office in a time of national solidarity, and the looming reconstruction, which will dominate his agenda in place of proposed social reforms, should invite the kind of foreign investment and financial growth his conservative party advocates.

Furthermore, Mr. Piñera is in a position to improve on Michelle Bachelet’s scrutinized response to the earthquake.  Among the criticisms against her administration: that it failed to issue a tsunami warning for the city of Concepcion, leaving thousands exposed to destructive floods. Mrs. Bachelet, who is calling this disaster the worst in the country’s history, is also criticized for rejecting aid from the international community in the opening stages of the disaster.  Many regard the desperate looting of supermarkets and department stores, sparked by delayed access to food and water in some areas, as a sign of government mishandling.   Bachelet’s decision to mobilize 14,000 troops to restore civil order (BBC) is also considered a controversial move in a country still sensitive to army presence following years of oppressive military regimes. 

But despite this government response, which has been at times as frustrated as the beleaguered population, a recent report by Washinton DC think-tank Brookings, urges a more balanced perspective.  In regard to the question of the tsunami warning, for example, the Brookings report suggests that, as waves formed almost instantly (not more than 20 minutes after the quake, according to TIME), there would have been little room to implement an evacuation warning or, in light of collapsed telephone and power lines, the ability to even issue one in some areas.  Which is not to say that the head of the Navy/Oceanographic Services correctly evaluated the situation – his failure has seen him sacked this week. The tsunami indeed remains the major culprit of casualties and coastal devastation. 

The Brookings report also points to at least one government success: building codes. All earthquake-prone areas in the world have a responsibility to adhere to these recommendations, but too often they fall victim to neglect and bureaucratic corruption.  Such was the case in China in 2008, where an earthquake in the Sichuan province saw thousands tragically killed in collapsed buildings.  The relatively low death toll (in comparison to Haiti’s devastating figures) and the resistance of so many of Chile’s urban structures indicated a particular commitment to code enforcement during Bachelet’s administration. 

Still, for the Chileans on the ground, this might come as little consolation.  Not only have hundreds lost families, but thousands more their livelihood.  The recent scenes of civil unrest have also raised questions as to lingering social divisions.  To say nothing of the extreme intensity and unbearable duration of the earthquake, which continues to traumatize an anxious nation with its tremors.    

With the cost to human life small compared to the humanitarian emergency of Haiti, it is easy to forget the remarkable potency of Chile’s quake, but one need only glance at the harrowing images of churned up roads and twisted bridges to be reminded of the awesome seismic forces at work.   Indeed, it would not be incorrect to call them ‘earth-shattering’.  Scientific reports are revealing that the 7^th most powerful quake in history possibly shifted the Earth off its axis.  It moved the city of Concepcion a whole 10 feet west of its original location, Santiago 11 inches west-southwest, and distant Buenos Aires by an inch (LA Times).

Follow Up: The World Chimes in on Latin American Drug Policy

In last month’s article ‘Latin America: Changing Drug Policies” we addressed the trend of relaxed drug policies in countries throughout the region and the shrinking influence of the US-led ‘War on Drugs over the past year.  These changes seem to have taken place without much vocal opposition on the subject from the current administration or from any entity beyond the region.  But the silence is now over. 

In the closing days of February, the UN’s International Narcotics Control Board expressed its consternation in its annual report, castigating what it viewed as a promotion of drug possession by Latin American nations.  The report described recent drug possession rulings as a “threat” to the “coherence and effectiveness” of the international drug control system, and said it regrets that “influential personalities, including former high-level politicians in countries in South America, have publicly expressed their support for that movement.”  The latter statement is likely directed at former Brazilian President Fernando Henrique Cardoso, who has worked with the Latin American Commission on Drugs and Democracy to decriminalize marijuana and treat drug use as a public health issue (Bloomberg).

The Amsterdam-based Transnational Institute and Washington Office on Latin America, a policy research organization, responded to the INCB report, claiming it “clearly oversteps” its own mandate and represents “unwarranted intrusions into these countries’ sovereign decision-making” (Business Week).

When the US administration at last addressed the issue of drug policy in Latin America this March, it was less to admonish Latin American states and more to take more of the blame.  Indeed, presumably to the dismay of US conservatives, Secretary Clinton conceded to Central American counterparts that the high demand of illegal drugs in the US was responsible for continued proliferation of narcotics and the current climate of drug violence. Mrs. Clinton consequently pledged funds to “corridor” nations like Guatemala to help combat trafficking and related violent elements.  The same week Mrs. Clinton concluded her visit, two US citizens with ties to the Consulate in Juarez, Mexico, were killed by the drug cartels in that city.  Judging from the fact that the administration had so little to comment on drug policy changes in Latin America, it seems likely, its immediate focus in the coming months will be its own backyard.

Economy & Politics:

New Regional Bloc Sets Tone for Clinton Tour of Latin America

Regional leaders at the Rio Summit in Mexico in late February announced the launch of a new regional bloc that would exclude the US and Canada, according to the Christian Science Monitor.  The announcement came just a week prior to the beginning of Hillary Clinton’s five-day tour of Latin America.

Proposed by Mexican President Felipe Calderon, the new group – provisionally named the Community of Latin American and Caribbean States (CELC) – offers nations an alternative to the Washington-led OAS, which has been criticized in the past for promoting US interests above those of other nations in the region.  Although not all countries are in favor of replacing the OAS entirely (notably newly conservative Chile), there is a sense that this group will more closely echo the needs of Latin America and the Caribbean, and will unite the region with a common agenda of sovereignty, cooperation, non-violent conflict resolution, democracy and human rights.  As expected, some of the most vocal proponents of the new bloc, and the separation from US influence it stands to afford, include such left-leaning governments as Bolivia, Ecuador, Venezuela, and Cuba.  However, the strong support for the CELC from neighboring Mexico and growing powerhouse Brazil seems to hint at a general waning of US leadership.

Secretary of State Clinton’s visit was an opportunity to redress this and spread the message of equal partnership and cooperation, which an enthusiastically-received President Obama ensured this time last year before encountering more pressing issues at home.  But judging from newspaper reports, like the Guardian UK, Secretary Clinton’s success is being likened to that of former President George W. Bush’s in 2005.  The overshadowing effect of the Chilean earthquake aside, Secretary Clinton’s agenda helped to make few friends. 

There was her praise of the ‘non-violent’ Honduras resolution, and her urging for nations to recognize the new government.   Many outside Central America remain against the military coup, which sparked months of violence; they also question the legitimacy of the Honduran elections, conducted under that coup, and US backing of center-right President Porfirio Lobo.  Following this unpopular stance, Clinton’s vocal criticisms of populist Venezuela, (though admittedly justified, even according to other regional leaders) could not but strike a false cord.  Her suggestion that Venezuela look to the south for guidance - an attempt at mollification or at passing the buck, depending on one’s point of view - , was answered by Brazil President Lula da Silva with his assurance that South America intended just that – by inviting Venezuela to become a full member of Mercosur.  Secretary Clinton continued to run into opposition in Brazil by pressuring for sanctions against Iran.  In a press announcement, Brazilian Foreign Minister Celso Amorim stated pointedly that “We will not simply bow down to an evolving consensus if we do not agree.” 

Secretary Clinton proved more popular in Argentina, where she pledged support in resolving the country’s current dispute with the UK over oil drilling in Falkland waters, and in Guatemala, where the US has pledged funds for counternarcotics operations.  On whole, however, the Secretary of State’s tour demonstrated an increasing determination by Latin American nations to exercise their autonomy.  The creation of the CELC is a direct reflection of this impetus.  The new group is set to convene officially for the first time in July 2011, by which time Latin America will show the international community, and its neighbors to the north, just how adept it is at resolving major issues, namely the Colombia-Venezuela conflict.  For now, only one thing seems certain: Russia and China are at full attention.

Venezuela Energy Crisis Threatens Economy and Chavez Regime

One of the worst droughts in Venezuela’s history is being blamed for nationwide power blackouts that are plunging cities into darkness and the economy into crisis, Reuters reports.  Since December severe droughts, caused by El Nino, have been emptying the reservoirs that drive Venezuela’s hydro-electrical plants and provide 70% of the country’s power.  On the street, the blackouts are compounded by sweltering temperatures in the high 90’s.  In addition to the obvious lack of light which has closed offices; homes and stores have no air conditioning; restaurants and supermarkets no refrigeration.  Hospitals are reporting an increase in people seeking psychological help because of the heat.  But industry is suffering most, with car making steel processing unable to operate.  Economic activity is down 25%, and the government has ordered more rationing, aiming at cutting consumption by another 20%.  With the rainy season not expected to start until May and the country’s main reservoir, El Guri (alone responsible for 50% of Venezuela’s power), nearing collapse, the situation is about to get worse. 

And for none more so that for President Hugo Chavez, whose approval ratings are plummeting.  54% of Venezuelans have no or little confidence in Chavez, and almost 60% disapprove of his government’s handling of the crisis.  Many blame the state for the condition of the power plants and its refusal to invest in improvements before the droughts. Chavez’s assurance that it will soon rain – claiming ‘God is Bolivarian’ – can hardly be assuaging detractors.  The real political repercussions will be measured in September, when the country holds legislative elections.

As for regular Venezuelans, the energy crisis may be a blessing in disguise. The country, after all, is Latin America’s biggest per capita energy users.  Owing to necessity, the government has launched an educational campaign on energy conservation, and to that end has dispatched the army and local councils to distribute millions of energy-efficient light bulbs.   Although the use of fossil fuels for electricity generators is expected to rise this year by 30%, there is hope that these early steps by the government to change consumption habits may reverberate positively for generations to come.

Colombia Hailed as Model Democracy for Defeat of Third Term

Colombia is being hailed as a beacon of democracy this month, following the country’s constitutional court rejection of a bill that would have allowed Alvaro Uribe to run for an unprecedented third term, according to numerous international news sources, including the Wall Street Journal.  President Uribe, who enjoys enormous popularity for his work in reducing crime and guerilla-related violence, is also being lauded for his full acceptance of the ruling.  A favorable ruling would almost have guaranteed his reelection. Instead he is barred not only from a third consecutive term but from running again in his lifetime. 

An opinion poll quoted in The Economist suggests that 43% of Colombian will now vote for whichever candidate Mr. Uribe endorses in May, Defense Minister Juan Manuel Santos currently finding himself the frontrunner.  Overall, Uribe’s Conservative Party is positioned to do well in the upcoming presidential elections, having this week dominated the country’s congressional elections – they captured 65% of the seats in the senate and won a majority in the house.  But while President Uribe’s influence is destined to continue even without his name on the ballot, its very absence is having a far-reaching effect on regional politics.

The trend of amending constitutionally established presidential terms has gathered steam in the past couple of years.  Venezuela’s ruling to eliminate the limit of presidential term in February 2009 signaled a major victory for Hugo Chavez (his plan for permanent domination slightly impaired by his declining popularity), and sparked similar movements in Ecuador and Bolivia.  Honduras’ Zelaya owes much of his recent ousting to this same ambition.  Even Brazil considered introducing an additional term in the hopes of maintaining the political and economic stability many credit Lula da Silva with having brought about.  Colombia, in contrast to this tide of burgeoning autocracies, and in light of Uribe’s popularity, has shown genuine respect for the democratic process.   And as the Washington Post asserts, Uribe’s legacy might ultimately not be his defeat of domestic terrorism, but the gift of a functional political system and a rule of law intact.

Media:

Argentina Celebrates Surprise Academy Award

This March, Argentina reconfirmed itself as a power player in the global film industry, when Juan Jose Campanella’s ‘The Secret in their Eyes’ (El Secreto en Sus Ojos) walked away with the coveted Academy Award for Foreign Language Film and sent an entire nation into raptures (Guardian UK).  On its road to Oscar glory, the film beat out two Cannes prize winners and a fellow Latin American nominee.  President Cristina Kirchner joined in the celebration this past week, praising the talent of previously-nominated Campanella and his film’s impact on her.  ‘The Secret in their Eyes’ is a suspenseful crime drama that centers on the 1974 murder of a woman during an oppressive era of military dictatorship, and is the country’s second highest-grossing film ever. 

Argentina previously won the award in 1986 for Luis Puenzo’s ‘Official History’ (La Historia official), and remains the only country in Latin America recognized by the Academy in this category.  The region was well represented at the awards show this year, with Peru enjoying a first-time nomination for ‘The Milk of Sorrow’ (La Teta Asustada).  The festival darling which addresses the fears of abused women in the country’s recent history, was awarded two honors at the 2009 Berlin International Film Festival, including the prestigious Golden Bear Award.

Mexico Telecom Tycoon Becomes World Richest Man

The 2010 Forbes magazine’s annual World’s billionaire list appeared in newsstands this past week, and the name atop that list may surprise a few.  No, it’s not Gates of Buffet – the title of world’s richest man now rests with Mexican telecom billionaire Carlos Slim Helu, who’s fortune rose an estimated $18.5 billion over the past year to reach $53.5 billion. 

To most Mexicans, it might seem that Slims has held the title for a while, as there is little in their daily life the billionaire does not have a stake in – his empire includes 200 companies that encompass every commercial commodity from banking, construction, retail, restaurants, automobiles and media.  Slim has even had success in the chronically unprofitable area of aviation with low-cost airline Volaris, Mexico’s third largest carrier after Aeromexico and Mexicana.  With this stronghold on every aspect of consumer life, from cigarettes and coffee drinks to cell phones and clothing stores, Slim’s omnipresence has given rise to the not entirely flattering term, ‘Slimlandia’ (Telegraph). 

But for all his diverse interests, Slimlandia’s strength stems from one principal source – Mexico’s telecom industry, over which Slim enjoys a virtual monopoly.  Reminiscent of the US robber barons of the late 19^th century, Slim controls America Movil, Telcel, and Telmex, which alone represents almost 90% of Mexico’s land lines and is the country’s main internet provider.  Considering that his companies charge some of the world’s highest usage fees, this vice-like grip on the telecom industry has won Slim few friends on the ground.

Slim’s ill-advised comments, such as not intending on “going around like Santa Claus” (referring to the sizable charity donations of international moguls like Bill Gates) have done little to endear him to the public.  Critics assert that even with a recent pledge of $6 billion to his three foundations, which work among others on the restoration of historic Mexico City, Slim is a long way from becoming a “Latin America Rockefeller.”  In fact, were it not for his considerable philanthropy, Slim critics point out, Bill Gates would surely have retained his crown. 

Tourism:

Latin America Airline Passenger Demand among Strongest in the World

The Star Telegram reported figures from the International Air Transport Association this past month show Latin America far above the international growth rate for passenger demand in January 2010, 11% compared to the global average of 6.4%.  Within the region, Brazilian airline GOL is reflecting the industry trend with a posted 46.9% growth in passenger traffic in February over the same month in 2009.  GOL attributes this to general economic recovery in Brazil and Argentina, new routes to the Caribbean, exemplary service, efficient cost structure, and revitalization of its SMILES incentive program.  Another major regional airline, Chile-based LAN, registered a 9.6% growth in February.  Figures for March are bound to decline, as cancellations due to the earthquake and damage to domestic airports kept the airline operations from the Santiago International Airport at around 50% for more than two weeks.  However, LAN shares, which rose 1.7% in recent trading, should continue to climb with the impending sale of President Piñera’s 11% share in the company (Dow Jones).

Cultural Interest:

Shakira Joins World Bank Childhood Initiative

This month the World Bank joined with Grammy Award-winning singer and activist Shakira in the $300 million “Early Childhood Initiative: An Investment for Life”, aimed at helping the development of young children in Latin America and the Caribbean, the AFP reported in late February.  The initiative will support, over a span of two years, program funding and policy geared towards improving nutrition and health care, among others, for young children through the age of six.  Shakira, in a press conference, urged the importance of equal opportunity for every child, regardless of the economic or social position it is born into.  The Colombian celebrity, who met earlier with President Obama and Vice-President Biden to discuss the initiative’s aims, is already heavily involved in childhood development with her ALAS Foundation, a coalition of artists and businesses that strives to help the region’s 22 million impoverished children who still lack access to basic care.  

 Village Girl Emerges as Earthquake Hero

From the Epoch Times: “Martina Maturana, only 12 years old, felt a slight tremor on Feb. 27 whilst everyone was asleep on Robinson Crusoe Island, in the Archipelago of Juan Fernández 420 miles off the coast of Chile.  Concerned, she warned her policeman father that something was happening. To reassure her, he called her grandfather who lives in Valparaiso in central Chile. They learned from him that a massive earthquake had struck the country just minutes before.  Just then, the girl noticed out the window that the sea was moving the boats in a strange way so she ran to the square to sound the alarm bell, waking the some 700 inhabitants of the island who live in the only village of San Juan Bautista.  According to the Chilean press, the girl did not know how many times she had to strike the bell for a tsunami warning, as there are different codes for each situation. The first residents who awoke continued playing the bells to warn people to climb hills to save themselves. It was just in time. Within minutes the giant tsunami wave came, destroying everything in its path.”