Political Risk Latin America Blog @PolRiskLatam

Student Protests Grow in Chile

Posted in News and Articles, Political Risk by politicalrisklatam on August 5, 2011

by Americas Quarterly Blog, August 4th, 2011.

The leaders of widespread student and faculty protests in Chile yesterday announced plans to mount a national strike and an additional series of mass demonstrations to contest a far-reaching education reform bill supported by the government. In response, Chilean Interior Minister Rodrigo Hinzpeter indicated that his office would deny to students permission to demonstrate in downtown Santiago where prior confrontations with police have caused significant property damage: “The march will not be approved by our government due to the damage caused to property, bystanders and police. We will take all necessary measures to enforce the decision. It is time for the demonstrations to end.”

According to student leaders, the government’s proposed education reforms would allow for excessive levels of privatization in the education sector and lead to higher levels of indebtedness among graduates. “We analyzed the ministry’s proposal and students considered it a setback because it allows profit in the education sector. We do not see any structural changes, but only further privatization and perpetuation of student debt,” said Univeridad Católica de Valparaíso official Nataly Espinoza.

Chile has long struggled with education reform initiatives and these latest demonstrations are the culmination of more than two months of smaller protests across Chile. Students are calling for a halt of the trend toward privatization in education and other basic services such as public transportation.


Humala: We Wait

Posted in News and Articles, Political Risk by politicalrisklatam on June 16, 2011

by Christopher Sabatini for Americas Quarterly Online, June 15th, 2011.

The election guessing game in Peru has ended and now the Humala guessing game has begun: Will Ollanta Humala be the Peruvian equivalent of Venezuela’s Chávez or Brazil’s Lula? The answer, on which may hang Peru’s torrid rates of economic growth—among the highest in the region—and web of free-trade agreements with everyone from China to the  United States, has become a parlor game for investors and observers, as we all watch whom Humala nominates to his cabinet. More than the people he chooses to populate his first round of appointments, the answer may actually lie in his formation as a military officer.

When he first ran for president in 2006, Humala professed his admiration forVenezuelan President Hugo Chávez; he even campaigned in the trademark-Bolivarian red tee shirt. Only five years later, the one-time lieutenant colonel who led an uprising against former elected autocrat President Alberto Fujimori, claimed he was a moderate leftist in the mold of former Brazilian President Luiz Inácio Lula da Silva, who embraced markets and foreign investors and reduced poverty.

It’s not hard to understand why he shifted role models. In the intervening five years, President Chávez has gone from the leader of an anti-American bloc of countries during the years of President George W. Bush to the head of the most dysfunctional economy in the region, with rates of inflation this year likely topping 25 percentand an economy that, even with the spike in oil prices, will be one of the last to rise out of the region’s post-recession torpor. In contrast, President Lula, by hewing to a course of fiscal stability, appointing confidence-instilling technocrats and supporting both foreign investors and Brazilian companies, has both kept Brazil on a path of stable economic growth and—combined with innovative social policies—reduced the number of the Brazilian poor by up to 38 million. No mean feat. (continue reading… )

Does Gender Matter in Peru’s Presidential Race?

Posted in News and Articles, Political Risk by politicalrisklatam on June 3, 2011

by Sabrina Karim for Americas Quarterly Online, June 1st, 2011.

For several weeks now, Keiko Fujimori has been ahead in most of the major polls.  If she wins, she will be the first female president in Peru. While Nobel laureate Mario Vargas Llosa, who ran against Keiko’s father in 1990 has said the choice between Ollanta Humala and Keiko is like choosing between AIDS and cancer, no one has asked what it would mean to have a female president in Peru.  At least some academic literature suggests there are differences between male and female heads of states.

Would Keiko Fujimori lead differently than a male counterpart?  Would Keiko’s policies better benefit women?

There is a wide body of literature around women and corruption.  Here, it has been suggested than women possess certain innate qualities that make them less corrupt than men.  Given this assumption, would Keiko be less corrupt than her male counterpart?  Keiko is the daughter of former President Alberto Fujimori who was sentenced to 25 years in prison for corruption and human rights abuses.  While many argue that children are not necessarily replicas of their parents, she has surrounded herself with her father’s old advisors and there have been reports that her father is leading her election campaign from prison. Her top campaign advisor is Jaime Yoshiyama, who helped rewrite Peru’s constitution after Alberto Fujimori shut down congress in 1992. (continue reading… )

Funes Completes Two Years as Salvadoran President

Posted in News and Articles, Political Risk by politicalrisklatam on June 1, 2011

by Americas Quarterly Online, June 1st, 2011.

Amid a mix of praise and criticism, President Mauricio Funes today marks his second anniversary as the leader of El Salvador, with surveys showing that Salvadorans commend him for his progressive social policies but disapprove of the economy’s slow growth and rampant violence. In a national survey conducted by the Instituto Universitario de Opinión Pública at the Universidad Centroamericana from April 29 to May 7, 1,262 Salvadorans rated Funes’ job performance at 6.16 on a scale of 1 to 10, down from 6.78 a year ago and 7.6 in August 2009.

A member of the Frente Farabundo Martí para la Liberación (FMLN)—a leftist guerrilla organization that was converted into a political party in 1992—Funes assumed the presidency in the midst of the global economic recession and following 20 years of consecutive government by the right-wing Alianza Republicana Nacionalista (ARENA) party. He prioritized maintaining close relations with the United States, where more than 2 million Salvadorans live and work, contributing to the U.S. economy as well as to the Salvadoran economy through remittances. The President also has focused on implementing social policies to mitigate the effects of the recession on the Salvadoran poor. Among these is the provision of free lunches, school supplies, uniforms, and shoes to more than 377 million public school students;  free medical services; and the Plan de Agricultura Familiar to assist small farmers with credit, insurance, technical assistance, and the procurement of seeds and fertilizer.(continue reading… )

Final Referendum Tally Signals Victory for Correa

Posted in News and Articles, Political Risk by politicalrisklatam on May 23, 2011

by Americas Quarterly Online, May 19th, 2011.

Almost two weeks after Ecuador held its sixth referendum in three years, the National Electoral Council (CNE) announced last night that nine of 10 referendum questions received majority votes in favor of President Rafael Correa’s proposals.  Official results indicate that votes in favor of the proposals accounted for between 44.96 and 50.46 percent of votes cast, while votes opposed to the questions received between only 39.25 and 42.56 percent of votes. The results omit nullified votes or “blank” votes.

The final referendum question on whether to outlaw cock and bullfighting, a question to be addressed by individual districts, received approval in 127 of 221 districts. It will be implemented only in those districts where approved.

The referendum, viewed by many as a vote of confidence in the president himself, was largely expected to be approved. However, growing resentment of the president’s perceived reach into control of the media and his proposal to revamp the judiciary led many to believe that this would not be a landslide victory for Correa. The victory may bolster Correa’s chances for reelection in the next presidential elections, to be held in 2013, although its narrow margin suggests such an outcome may not be as easily achieved as was previously thought.

The results of the referendum now await final confirmation from the CNE, and opposition politicians may still contest the results by filing complaints with the electoral authorities. (continue reading…. )

Ex-President of Costa Rica Found Guilty But Set Free

Posted in News and Articles, Political Risk by politicalrisklatam on May 19, 2011

by Alex Leff for Americas Quarterly Online, May 17, 2011.

A San José court rejected most of an appeal by former Costa Rican President Rafael Calderón last week, but the court ruled to lighten his charges and overturned his five-year jail sentence.

Calderón, age 62, was convicted in October 2009 of two charges of embezzlement for helping divert millions of dollars from a Finnish government loan to Costa Rica’s social security system in 2004, after his presidency.

Last Wednesday, the appeals court reduced the ruling to a single embezzlement charge with three years in prison.

However, Calderón won’t go behind bars.

Under Costa Rican law, a person who is handed a sentence of three years or less, and whose record is otherwise clean, can walk.

In Calderón’s case, the judges said he must refrain from breaking the law for five years or else he could lose this get-out-of-jail card. (continue reading… )

Reflections on Brazil’s Global Rise

Posted in News and Articles, Political Risk by politicalrisklatam on May 3, 2011

by Celso Amorim for Americas Quarterly, May 2nd, 2011.

The man who led Brazil into its new global era discusses his diplomatic vision and Brazil-U.S. relations.

This is the first article I have written since leaving the foreign ministry of Brazil. As someone who was very active in formulating foreign policy during what might be called “the Lula era” (and still without the benefit of much hindsight), it is an opportunity to begin taking stock of what has been achieved so far. The most remarkable fact about Brazilian foreign policy in recent years has been Brazil’s new and more prominent stance in the international arena. To be sure, this qualitative change, which resulted in The Economistdescribing Brazil as “a diplomatic giant,” is not solely—or even principally—due to foreign policy.

In recent years, Brazil has grown economically while keeping inflation under control, improved income distribution and, above all, strengthened its democracy. Who could have predicted after years of military dictatorship, immediately followed by the impeachment of the country’s first popularly-elected president, that Brazil’s next three heads of state would be an intellectual who fought against the dictatorship, a labor leader routinely labeled as a dangerous revolutionary, and now a woman who once was a political prisoner?

These changes have had a major impact on Brazil’s stance toward other countries and also on how other countries view Brazil. As I said in a recent interview, Brazilian foreign policy may not have created the wave, but it learned how to ride it. It should come as no surprise that international interest in Brazilian foreign policy has increased notably in recent years, culminating with the 2010 elections.

A professor interviewed by Le Monde in the period leading up to the presidential vote called the Lula administration’s diplomacy “imaginative.” Others have been less generous. Either way, it cannot be said that Brazil’s foreign policy in recent years has been ineffective or has maintained a low profile.

But to what extent and why has its foreign policy contributed to that prominence? (continue reading… )

Change is Coming to Peru

Posted in News and Articles, Political Risk by politicalrisklatam on April 27, 2011

by Eric Farnsworth for Americas Quarterly, April 25th, 2011.

Peruvians go to the polls June 5 for the second round of voting to determine their next president. Early handicappers have Ollanta Humala leading Keiko Fujimori and pulling away. Of course, anything can happen, and five weeks is an eternity in politics. Nonetheless, already a debate is raging whether Humala, should he indeed be elected, will be a Peruvian version of former Brazilian President Luiz Inácio Lula da Silva or a Chávez acolyte, or perhaps some sort of hybrid nationalist.

Credit where it is due: Humala has effectively repositioned himself during the campaign as a moderate in the Lula model, rather than the populist authoritarian in the Chávez model who scared Peruvian voters and opened the door to a rehabilitation of President Alan Garcia during the last electoral cycle. Since then he has shed his military garb and taken to wearing suits, disavowed Chávez, and toned down the anti-business, class-warring rhetoric. Investors are not delighted by the choice between him and Fujimori and they are casting a wary eye, but neither are they—yet—running for the exits.

The primary knock against Fujimori is that she is the daughter of disgraced former President Alberto Fujimori, now in jail in Peru. Much of her campaign platform has been ignored by observers and analysts obsessed with the prospect that her main initiative—were she to be elected—would be to pardon her father and serve as his puppet. That is an overly narrow view of what she would do as Peru’s first female president. Nonetheless, if elected, the polarizing albatross of her father would make it doubly difficult to govern, generating fierce resistance, particularly with a minority in Congress. (continue reading… )

Peru’s Presidential Vote by the Numbers

Posted in News and Articles, Political Risk by politicalrisklatam on April 13, 2011

by Fabiola Cordova for Americas Quarterly Online, April 11th, 2011.

Over the past few months, multiple hopefuls have emerged, surged and then collapsed in the race to become Peru’s next president. Former Lima Mayor Luis Castañeda, the first to declare his candidacy, led early polls, but finished a distant fifth place in Sunday’s vote. Former President Alejandro Toledo, whose support hovered around 30 percent in many polls, was expected to coast into the second-round vote. Instead, he finished in fourth place. Pedro Pablo Kuczynski, a less-than-well-known technocrat, was polling at five percent only a month before the election, but he surged in recent weeks with strong support from businesses and young voters and finished a strong third place on Sunday. Congresswoman Keiko Fujimori—daughter of former President Alberto Fujimori—had difficulties moving beyond her father’s traditional support base (around 20 percent of the electorate), but with the moderate vote split between three candidates this was enough to pass on to the second round. Two-time presidential candidate Ollanta Humala tapped into many Peruvians’ dissatisfaction with the lopsided distribution of wealth that has accompanied the rapid growth of recent years, and surged from 10 percent to 30 percent support in only a few weeks.

Now Humala will face Fujimori in the June 5 runoff.

Results by the Numbers

The Peruvian civil society group Transparencia-Perú conducted an election-day observation and quick count predicting the following final results (with a 1.5 percent margin of error):

Ollanta Humala (Gana Perú)                                                       31.3 percent
Keiko Fujimori (Fuerza 2011)                                                     23.2 percent
Pedro Pablo Kuczynski (Alianza por el Gran Cambio)    18.7 percent
Alejandro Toledo (Perú Posible)                                               15.9 percent
Luis Castañeda (Alianza Solidaridad Nacional)                 10.0 percent

Both Transparencia-Perú and the Organization of American States (OAS) election-monitoring delegation reported very few irregularities. Electoral authorities also seem to have addressed the technical problems that delayed the results of last year’s Lima mayoral election.

These results also reflect recent polling trends that showed Humala with a clear advantage over the other candidates. Keiko Fujimori maintained her core support of around 20 percent. And moderate voters did, in fact, split their votes between the three other candidates, who all had similar campaign platforms and were unable to join forces. Notably, Humala and Fujimori have the highest voter disapproval rates at around 40 percent each. Peruvian writer and Nobel Laureate Mario Vargas Llosa famously quipped that this scenario “would be a choice between AIDS and cancer.”

Humala and Fujimori’s commitment to democratic principles remain largely in question and they represent the opposite extremes of Peru’s political spectrum. According to many observers, the fragmentation, overall weakness and personality-driven nature of Peru’s party system helps explain the split of moderate votes. (continue reading… )


Uruguay: The Components of Its Success

Posted in News and Articles, Political Risk by politicalrisklatam on March 31, 2011

by Janie Hulse Najenson for Americas Quarterly Online, March 29th, 2011.

Just a decade ago, most Latin American governments looked to the United States and Europe as examples of how to improve governance, foster sustainable economic growth and institute more just societies. But today, there are some countries in Latin America that serve as case studies worth following—one of which is Uruguay. It may be the size of Washington State and have one of the smallest populations in the region (3.3 million), but it should be truly commended for its developmental progress in recent years.

Although dwarfed by the neighboring economies of Brazil and Argentina, Uruguayans overall have a better standard of living. Uruguay’s annual per-capita income is estimated at roughly $14,000—higher than that of Brazil and Argentina. Physical security is better, too, as evidenced by known cases of families moving from Buenos Aires to Montevideo in search of a safer environment. Recent regional rankings on tourism reflect Uruguay as a desirable destination. According to the 2010 Latin Business Chronicle’s Tourism Index, Uruguay is Latin America’s tourism champion. The country receives more than 2 million tourists a year, an amount equaling roughly 60 percent of its population.

Years of economic growth and state policy promoting technology usage by citizens, government and business has made the Uruguayans some of the most tech-savvy in the region. In May 2008, former president Tabaré Vázquez (2005-10) launched a government program called La Agenda Digital Uruguay 2008-10 (Uruguay Digital Agenda 2008-10) that worked toward the consolidation of all of Uruguay’s information technology programs. Its main objective was to create a more inclusive and democratic society. It gave high priority to Plan Ceibal, known in English as One Laptop per Child, which is responsible for distributing low-cost laptops to all public primary-school students and teachers. This open-source initiative has been so successful that it was extended to secondary schools, and inspired another project to make available affordable “triple play” (Internet, phone, and television) services to low-income families. By November 2010, Uruguay’s investment agency Uruguay XXI reported that the government had distributed 380,000 laptops, trained 18,000 teachers, created 280 free Wi-Fi areas in Montevideo and gave 220,000 families their first computer. (continue reading… )