Do we really need another lesson on the folly of attempting to appease dictators?

Apparently, Foreign Affairs thinks so — albeit inadvertently. They recently posted a piece, “Our Man in Havana,” about the heroic efforts of some Obama administration officials to give the Castro regime everything it wanted for the release of jailed development worker Alan Gross. Specifically, this meant gutting the official U.S. democracy program for Cuba that Gross was operating under. In the end, however, they just could not overcome the intransigence of — not the Castro regime — but the “Cuban-American Lobby” in Congress.

Indeed, not only did they not wind up with the long-suffering Gross’s freedom, but, to boot, former Assistant Secretary of State Arturo Valenzuela was forced to sit through a humiliating meeting with Cuban officials ranting about all the dictatorship’s grievances against the United States. As the article puts it, “The Cubans were far less flexible than the ... Read More

About 15 years ago, on assignment in Bolivia, I met a pair of local drug-enforcement agents who were kicking back in a hotel bar. The conversation was light and easygoing, until I mentioned I was based in Brazil. “Ah, Braaaazil,” said one of the agents, peacocking for effect. “The land of ‘the biggest in the world.’” I wrote his comment off as Latino envy, that familiar jolt of resentment, which served as the subtext of many conversations about the giant of South America and the neighbors it dwarfed. The comment was also a telling expression of how people viewed the old Brazil, the hemisphere’s large underachiever, a nation that frequently waxed grandiose and then fell short of hype and expectations.

Much has changed in Latin America since then, nowhere more so than in Brazil. Stable, democratic, stylish, and self confident, this $2.5 trillion economy now has some backbone behind its swagger; ... Read More

Nothing takes the “happy” out of Happy New Year like the thought of Barack Obamain the White House for four more years. Elsewhere in the hemisphere, the outlook is equally grim in many countries. But believe it or not, a few countries are getting things right.

The losers are easy to pick out. Fidel Castro still fogs a mirror, and the military government in Venezuela will probably continue wrecking the economy even if Hugo Chávez succumbs to cancer. The prospects of Argentina ever retiring peronismoremain dim.

Ecuador and Bolivia also fit the loser mold: left-wing populist politics supporting corporatist, authoritarian states. Political competition has survived in Brazil. Yet by sticking to a closed economic model that tries to preserve an industrial plan from the 1960s, it continues to underperform relative to its potential.

State-managed economies never do well, as Argentina’s latest relapse can attest. According to nongovernment estimates, inflation is now close to 25%. Growth ... Read More

BY NATE RAYMOND AND JONATHAN STEMPEL

Argentina is urging a U.S. appeals court to reverse an order requiring the country to pay $1.33 billion to creditors who did not participate in its two debt restructurings, a legal case that could have huge ramifications for global debt markets.

Lawyers for Argentina’s government said in court papers filed late on Friday that a trial judge was “wrong to ignore the chorus of voices” who opposed his November order on payments to so-called “holdout” creditors.

Those payments, to a court-controlled escrow account, would threaten the service of $24 billion in restructured debt, Argentina’s lawyers wrote in papers filed in the 2nd U.S. Circuit Court of Appeals in New York.

“There is no authority permitting a U.S. court to order a sovereign to bring its immune assets into the United States in order to ‘turn over’ or distribute them to its creditors,” lawyers for the Argentine government said ... Read More

A brother of Colombian President Juan Manuel Santos has revealed that the country’s largest guerrilla group had initially proposed to hold peace talks within Colombia or in neighboring Venezuela, rather than in Cuba.

Enrique Santos said in an article published in the newspaper El Espectador on Sunday that the government’s team had insisted that the talks not be held in Colombia.

“We decided on Cuba for security and above all because it guaranteed confidentiality,” Santos wrote in the article.

Representatives of the Colombian government and the Revolutionary Armed Forces of Colombia, or FARC, began discussions in Havana on Nov. 19 seeking a deal to end the country’s decades-old conflict. They currently are taking a holiday break and are to resume talks on Jan. 14.

Santos, a journalist and former director of the Colombian newspaper El Tiempo, is not a member of the team involved in the current talks, though he has acted as an ... Read More

Iberdrola SA (IBE) executives and Bolivian officials are likely to meet soon to discuss compensation for Spain’s largest utility after the nationalization of its Bolivian operations, Energy Minister Juan Jose Sosa said.

Bolivian army and police seized buildings occupied by Iberdrola on Dec. 29, hours after President Evo Morales ordered the nationalization of four business units owned by the company. The South American nation may hold talks next week with Iberdrola in Bolivia’s capital of La Paz, Sosa said.

“I would imagine that next week they’re going to be here,” he said yesterday on a state-controlled radio and television show, according toAgencia Boliviana de Informacion, a state-owned news service. “We’re going to talk, always in a cordial atmosphere, to see in what way we can arrive at a transition that is favorable for both sides.”

Morales has moved to put the telecommunications, energy and water industries under state control since taking power in 2006. In June, the government ... Read More

President Barack Obama enacted a law to counter Iran’s alleged influence in Latin America, through a new diplomatic and political strategy to be designed by the State Department.

The Countering Iran in the Western Hemisphere Act, passed by lawmakers earlier this year, calls for the State Department to develop a strategy within 180 days to “address Iran’s growing hostile presence and activity” in the region.

Although the strategy is confidential and only accessible to lawmakers, it must contain a public summary.

The text also calls on the Department of Homeland Security to bolster surveillance at US borders with Canada and Mexico to “prevent operatives from Iran, the IRGC (Iranian Revolutionary Guard Corps), its Quds Force, Hezbollah or any other terrorist organization from entering the Untied States.”

And within Latin American countries, the text provides for a multiagency action plan to provide security in those countries, along with a “counterterrorism and counter-radicalization plan” to isolate ... Read More

Hugo Chavez has suffered “new complications” following his cancer surgery in Cuba, his vice president said Sunday, describing the Venezuelan leader’s condition as delicate.

Vice President Nicolas Maduro spoke with a solemn expression in a televised address from Havana, saying he had spoken with Chavez and that the president sent greetings to his homeland. Maduro did not give details about the complications, which he said came amid a respiratory infection.

“Several minutes ago we were with President Chavez. We greeted each other and he himself referred to these complications,” Maduro said, reading from a prepared statement. Maduro was seated alongside Chavez’s eldest daughter, Rosa, and son-in-law Jorge Arreaza, as well as Attorney General Cilia Flores.

The vice president’s comments suggest an increasingly difficult fight for the ailing president. The Venezuelan leader has not been seen or heard from since undergoing his fourth cancer-related surgery Dec. 11, and government officials have said he might ... Read More

BY JAMES GLASSMAN

Argentina’s long-running battle to avoid settling its 2001 default may be approaching its end. More than $1 billion is being contested—but much more is at stake.

A court decision will soon determine whether investors can count on U.S. law to enforce their contractual rights when they lend money to foreign governments. If they can’t, sovereign lending will become a riskier proposition, leading to higher interest rates, higher costs to taxpayers, and a decline in confidence in the global financial system.

After the largest sovereign default in history, Argentina offered foreign governments, financial institutions and individual investors a take-it-or-leave-it 25 cents on the dollar for about $100 billion in outstanding debt. Many of those owed money, including 60,000 Italian pensioners, refused the deal. Seventy-six percent of creditors accepted the deal—far below the 95%-plus that has been the historical norm in negotiated sovereign-debt restructurings. As a result, there are two classes of ... Read More

It’s been a decade since Argentina tarnished its reputation worldwide and became an economic misfit by engaging in the biggest sovereign debt default in history, yet it is still haunted by the old bonds.

Although Argentina’s government restructured nearly all of the debt defaulted in the 2001 economic crisis, President Cristina Fernandez finds herself in a bitter U.S. court fight with holdout creditors that has raised the threat of severe financial repercussions.

The next step comes Friday when Argentina files its arguments for the final stage in its legal battle with NML Capital Ltd., an investment fund that specializes in suing over unpaid sovereign debts.

Argentina recently sidestepped economic chaos from the debt showdown when the 2nd U.S. Circuit Court of Appeals suspended a lower court’s order for Argentina to pay $1.3 billion into escrow for holders of its defaulted debt, an action that risked pushing the country into technical default.

U.S. District Judge ... Read More

Nicaraguan President Daniel Ortega seeks foreign investment from Brazil, China, Russia and Venezuela to help build the waterway. Ortega looks to the plan as an alternative to the Panama Canal, fulfilling a national dream more than 150 years in the making.

The United Nation’s International Court of Justice in the Hague last week redrew the maritime map between Colombia and Nicaragua, doubling Nicaragua’s exclusive economic zone in the Caribbean Sea by 38,600 square miles.

Neighboring nation Colombia has vehemently rejected the ruling. Colombian warships now sail defiantly through Nicaragua’s newly acquired maritime territory. The planned waterway has already added more tension in South America.

Among the economic boost brought by the waterway is the broader and more lucrative concessions for fishing and oil exploration. Straightaway, not everyone will be seeking government permission to exploit the area.

Northbound drug runners supplies the hemisphere’s $40 billion illegal-narcotics trade. With the court-ordered changing of the guard from ... Read More

Venezuela, already the most violent country in South America, recorded a new high of almost 21,000 murders in 2012, a non-governmental organization that monitors crime here said Thursday, December 27.

“We can conservatively estimate that 2012 will end with 21,692 deceased victims of violence, a rate of 73 deaths per 100,000 inhabitants,” the Venezuelan Violence Observatory said in its annual report.

“During 2012 there was a widespread increase of violence in Venezuela… despite the various measures taken by the government,” the group said.

Venezuela was already considered the most violent country in South America, with 50 homicides per 100,000 inhabitants last year, a total of 14,092 murders, according to official government figures in 2011.

The Observatory, which put the 2011 figure at 19,336 — a rate of 67 murders per 100,000 inhabitants — said 2012 had seen another 12 percent rise. No officials figures have been published yet for this year.

Unlike other Latin American ... Read More

BY JUAN FORERO

Glassy-eyed, rail-thin and filthy, hundreds of addicts emerged from doorways and alleys as dusk came to the once-grand Luz district in the heart of this city.

After quick transactions with crack dealers, they scrambled for a little privacy to light up their pipes and inhale tiny, highly addictive rocks that go for about $5 each. The image was reminiscent of Washington or New York in the 1980s, when crack cocaine engulfed whole neighborhoods and sparked a dizzying cycle of violence.

But this time, the crack epidemic is happening in Brazil, alarming officials and tarnishing the country’s carefully cultivated image ahead of two major sporting events to be staged here: soccer’s 2014 World Cup and the 2016 Summer Olympics.

In cities all over Brazil — from this gritty metropolis to the crown jewel of Rio de Janeiro and smaller places in the middle of the Amazonian jungle — nightfall brings out swarms ... Read More

BY CATHERINE E SHOICHET

More than 1,000 miles away from the jungle where rebels allegedly kidnapped and killed his father, Antonio Caballero is seeking justice.

He filed a lawsuit in a Florida court this month, 13 years after the bullet-riddled body of his father — a former senator and U.N. ambassador — was found on a dirt road in northern Colombia.

In the civil complaint, Caballero — who now lives in Florida after receiving political asylum in the United States — says he was forced to flee his home country, abandoning property and businesses, and he wants those responsible to pay.

The defendants are two guerrilla groups that have been at war with the Colombian government for decades: the Revolutionary Armed Forces of Colombia (FARC) and the National Liberation Army (ELN).

Caballero “has suffered and continues to suffer emotional, psychological and economic damages” since rebel forces kidnapped, tortured and killed his father, the lawsuit says.

He ... Read More

BY CARLOS ALBERTO MONTANER

Diosdado Cabello, president of Venezuela’s National Assembly, wants to postpone Hugo Chávez’s swearing-in for a new term as president. Apparently, his purpose is to give him time to recover. Some people around Chávez opine that Cabello wants to give him time to die. To him, it is easier to maneuver without Chávez than with the caudillo alive and breathing.

That’s the scenario Havana fears. Fidel Castro, who knows more than anybody else about Hugo Chávez’s health, in a short paragraph within the structure of a conventional obituary released Dec. 15, bade farewell to his still-living disciple and sent a message to the Chávez’s followers.

The old comandante ended his letter to Chávez’s designated political heir, Vice President Nicolás Maduro, thus: “I am certain that you and he — and even as painful as his absence might be — would be capable of continuing his task.”

This is the key portion of the communiqué. The ... Read More

President Hugo Chávez delegated to Vice President Nicolás Maduro increased administrative duties on a bunch of financial areas, further sparking rumors about the real health condition of the Venezuelan leader.

In a decree issued Wednesday from his hospital bed in Havana, Chávez granted Maduro the power to perform all government functions related to budget management, credit emissions and public appropriations.

The decree also empowers the vice president to appoint deputy ministers, presidents and board members of public entities, as well as to decree expropriations, liquidate agencies, grant pensions and approve tax exempt for some activities.

The announcement came just 48 hours after Maduro reported success in Chávez’s recovery, saying that he was already walking and exercising.

Chávez had passed on the duties to Maduro on Dec. 8, three days before the socialist leader underwent cancer-related surgery in Cuba. He has been silent since the operation, raising doubts among Venezuelans regarding his health.

Vice President Maduro surprised Venezuelans ... Read More

BY CHRIS KRAUL

CARTAGENA, Colombia — Under cover of a moonless night in early July, the crew took no more than five minutes to load more than a ton of cocaine on a motorboat beached on a deserted shore of the Guajira peninsula in northeastern Colombia. Equipped with three 200-horsepower engines, the “go-fast” craft then roared off toward the Dominican Republic, the first stop on the drugs’ way north.

But they’d been detected long before. Informants working for a top-secret group of Colombian agents, trained and equipped by U.S. counter-narcotics agencies, had penetrated the smugglers’ inner circle. They knew where the dope was loaded — and where it was headed.

A few hours later, Dominican police were waiting as the boat approached the eastern shores of Hispaniola. The captain, desperate to escape, beached the boat but was killed in a shootout. Police later recovered 1,690 pounds of cocaine, and authorities in Colombia guessed ... Read More

BY JUAN O. TAMAYO

Both hopes for and fears of significant changes in Cuba policies during President Barack Obama’s second term heightened Friday with the nomination of Sen. John Kerry as the next U.S. Secretary of State.

The Massachusetts Democrat in the past has endorsed the embargo but proposed allowing all travel to the island, including tourist trips, and criticized both Radio/TV Marti and the U.S. government’s pro-democracy programs in Cuba.

His nomination to succeed Hillary Clinton is expected to sail through Senate confirmation because Kerry has served in the Senate since 1984 and chairs the powerful Senate Committee on Foreign Relations.

Kerry’s long-telegraphed move to the State Department won applause from backers of the Obama administration’s policy of expanding ties and assistance to the Cuban people while waiting for the government to move toward democracy and human rights.

“The president’s positions on Cuba are clear, and he (Kerry) is a good pick to implement them,” ... Read More

BY MARY ANASTASIA O’GRADY

With Susan Rice withdrawing her name for U.S. secretary of state, President Obama last week nominated Massachusetts Sen. John Kerry for the job. Don’t expect applause from beleaguered democrats south of the border.

Mr. Kerry’s record of promoting American values abroad is dismal. It isn’t that he opposes U.S. intervention—far from it. The trouble is that he has a habit of intervening on behalf of bad guys. A left-wing world view and an earnest conviction that it is his destiny to impose it on others may make him a perfect fit in the Obama cabinet. But it won’t be good for poor countries or for U.S. interests.

Latin America knows all too well the dangerous combination of Mr. Kerry’s arrogance and, to be polite, let’s say, naiveté. In 1985, in the midst of the Cold War, he led a congressional delegation to Nicaragua, where he met with Sandinista comandanteDaniel Ortega. The Sandinista reputation ... Read More

BY WILLIAM NEUMAN

CARACAS, Venezuela — Top officials in the government of President Hugo Chávez, who is recuperating from cancer surgery in Cuba, say they will postpone his inauguration, now set for Jan. 10, if he is too ill to return to Venezuela to begin his new term.

Opposition politicians and commentators have said that if Mr. Chávez is not in Venezuela to be sworn in on that date, a constitutional provision would kick in requiring that a new election be held within 30 days.

But government officials loyal to Mr. Chávez have forcefully rejected that notion and said the swearing-in could take place at a later date.

“Jan. 10 is a date that the Constitution holds as a formality for the swearing-in,” Attorney General Cilia Flores said Monday in televised remarks to reporters after a church service during which top government officials prayed for Mr. Chávez’s recovery. She said the Constitution allowed the ... Read More