Content from IASW Contributors

New face may scramble Brazil’s presidential campaign

By Roger F. Noriega By Roger F. Noriega
Brazil’s presidential campaign took a tragic turn Wednesday morning when Socialist Party candidate Eduardo Campos, 49, was killed when the private plane he was traveling on crashed in the Brazilian port city of Santos; four other passengers and the two pilots also were killed. Campos’ running mate, Marina Silva Vaz de Lima, will likely be designated to assume the top spot on the Socialist alliance ticket.

Don’t Believe Everything You Read About the United States’ Cuba Democracy Program

By José R. CárdenasBy José R. Cárdenas
For the second time in four months, the Associated Press has published a gross distortion of USAID’s Cuba Democracy Program that has made it the subject of unjust derision from the legions of U.S.-Cuba policy critics. Read More-->

Venezuela doesn’t deserve a seat on the U.N. Security Council

| September 22nd, 2014 | No Comments »
From the Washington Post

By Editorial Board

THE ODDS that Venezuela, once Latin America’s richest country, will suffer a catastrophic economic collapse shortened significantly this month. Nicolás Maduro, the economically illiterate former bus driver who succeeded Hugo Chávez as president last year, rejected the advice of pragmatists proposing common-sense measures to rein in soaring inflation of more than 60 percent and crippling shortages of basic goods such as milk and toilet paper. Instead he gave a speech claiming that “our problems are the result of economic war waged by the opposition and private business.”

Now Mr. Maduro’s government is attempting to prove his point. It is pressing forward with the prosecution of several top opposition leaders, including Leopoldo López, the former mayor of a Caracas district who heads the more militant wing of anti-government forces. “Militant” is a relative term here: Earlier this year Mr. López and several allies called for peaceful street demonstrations under ... Read More

Bolivia Rejects U.S. Claim It Hasn’t Done Enough to Cut Drug Production

| September 19th, 2014 | No Comments »
Wall Street Journal WSJ-01

By Robert Kozak

Bolivian President Evo Morales rejected a U.S. government assertion that his country has failed to do enough to cut down on narcotics production.

Late last week the White House designated Bolivia, alongside Burma and Venezuela, as countries that have failed over the last year to do enough to comply with international counter narcotics agreements. Bolivia is the world’s third largest producer of coca and cocaine, according to the U.S. government.

“Whatever they do and whatever they say, or yell from the United States, the people won’t be confused by this type of information,” Mr. Morales said Wednesday in a speech ahead of general elections in October.

Mr. Morales, who remains leader of a regional coca growers group, is running for a third term as president, and opinion polls show him with a wide lead. Some coca leaf is grown legally in ... Read More

Citigroup Tells Appeals Court of Its Argentina Quandary

| September 19th, 2014 | No Comments »
The New York Times By Alexandra Stevenson

Argentina is holding a gun to the head of Citigroup, a lawyer for the bank told a three-judge panel in Manhattan on Thursday.

The bank has found itself in an awkward position: It must decide between defying a New York court order or a sovereign government, a move that it says would result in “grave sanctions” from Argentina.

“We’re going to obey, and if we obey, we have a gun to our head and the gun will probably go off,” Karen Wagner, a lawyer representing Citigroup, said.

The bank is the latest financial group to be caught in the battle between a group of bondholders and Argentina that prompted the country’s default this summer and threatens to engulf financial institutions which have until now watched from the sidelines.

Standing before a three-judge panel of the United States Court of Appeals for the Second Circuit, Ms. Wagner argued ... Read More

Mexico Has Reformed Its Energy Sector, Now What?

| September 19th, 2014 | No Comments »

By Dwight Dyer

MEXICO CITY – When Mexican President Enrique Peña Nieto signed into law the enabling reforms for his country’s energy sector last month, it marked the fulfillment of a campaign promise two years in the making. Although Mexico’s Congress last year agreed in principle to the reforms, the secondary laws passed last month actually define the parameters for the reshaped energy sector. Their passage is effectively the green light for private investors—both foreign and domestic—to enter the Mexican energy market.

So what happens next? A number of things all at once. The reforms themselves must be implemented and that means laying the ground rules and sign posts for private investment. Two days after Peña Nieto signed the enabling legislation, the National Hydrocarbon Commission announced which oil fields would be assigned to the state-owned oil company Pemex, which will retain the lion’s share of the country’s proven reserves, and by default ... Read More

Surprise Candidate Marina Silva Rattles Brazil’s Presidential Race

| September 19th, 2014 | No Comments »

By Raymond Colitt

Until Aug. 13, Marina Silva was the vice presidential candidate in a long-shot campaign to win the Brazilian national election. Then tragedy intervened: Her running mate, the presidential candidate for the Socialist Party, Eduardo Campos, died in a plane crash. Silva succeeded him and, in the weeks since, has seen her poll numbers rival those of President Dilma Rousseff, who had been favored to win the Oct. 5 vote being contested by three major candidates and several minor ones. The two women are now expected to face each other in a runoff, and Silva stands a solid chance of beating the incumbent.

“Sticking rigorously to the moral high ground will give her a minority government, while abandoning it will frustrate much of her support base.”—Rafael Cortez

Silva, 56, rose from a poverty- and disease-stricken childhood, not learning to read and write until she was 16. She went on to organize ... Read More

“This is not a speech. It is a life”

| September 19th, 2014 | No Comments »
The Economist

By H.J.

Brazil’s president, Dilma Rousseff, who is hoping to be granted a second term in next month’s elections, has claimed that only a vote for her can ensure the continuation of the country’s best-known anti-poverty programme, the Bolsa Família. Since 30m people out of an electorate of around 140m are directly or indirectly dependent on the programme’s cash handouts, this is potentially enormously damaging to her opponents, of whom Marina Silva is the best placed in the polls.

Ms Silva’s response was broadcast on television in her electoral advertising on September 16th. To feel the full force of her words, you need to know that she was born in the Seringal Bagaço, a poor, rural part of the Amazonian state of Acre, to parents who were rubber-tappers. Unlike almost anyone else in Brazilian politics, she knows how hunger feels. The video below is in Portuguese, subtitled. Our translation into English is ... Read More

Venezuela’s president is crafting a disaster

| September 19th, 2014 | No Comments »
Boston Globe

By Ricardo Hausmann

You’re a professor at a university in New England. You have gone on a business trip to the Middle East. At 3 a.m., as you are trying to catch up with your sleep and your jet lag, your daughter calls. She is distraught because President Obama has just gone on national television and spent 10 minutes telling the country that you are a thief and a financial assassin, that you conspire with dark foreign forces to harm the nation. While on his rant, he orders the Prosecutor General and the Attorney General to act against you.

You know that all these accusations are groundless, but it is easy to imagine what would happen next. Before you had a chance to call your lawyer, CNN, Fox News, MSNBC, and CNBC will be calling to ask you to confirm or deny the charge. They’d dig into your background, your Twitter feed, ... Read More

Argentina joins the Venezuela School of Economics

| September 19th, 2014 | No Comments »
From the Washington Post

By Nick Miroff

One of South America’s largest countries has passed new measures to cap consumer prices of goods, set profit margins for private businesses and levy fines on companies found to be making “artificial or unjustified” profits.

If that sounds like something they would do in Venezuela, well, that’s because they already have.

Now it’s Argentina that wants to use the heavy hand of the state to grip the invisible hand of the market.

After an all-night debate, legislators in Argentina’s lower house voted 130-105 early Thursday for a new “supply law” pushed by President Cristina Fernandez de Kirchner, who is battling inflation, product shortages and a debt crisis her government blames on “vulture” bondholders.

Economy Minister Axel Kicillof said the controls would protect ordinary shoppers against “the innumerable abuses” they suffer at checkout lines. Consumer prices have risen roughly 40 percent since last summer in some parts of the country.

Businesses and farmers in ... Read More

Can Marina Silva shock the status quo?

| September 18th, 2014 | No Comments »
The Miami Herald

A few months ago, incumbent president Dilma Rousseff appeared to be coasting toward reelection despite a flagging economy. However, in August, political maverick Marina Silva was thrust into the spotlight of Brazil’s presidential campaign after the death of her running mate. Pledging to reform the country’s dysfunctional politics and jumpstart the economy with free-market reforms, Silva has surged to a tie with Rousseff in recent polls.

As a result, Rousseff is not expected to win a majority of the vote on October 5 and faces a serious challenge from Silva in the runoff on October 26.

Silva’s humble background and fierce independence have attracted voters who have seen their economy slip into a recession under statist policies that are driving up deficits and drying up jobs. It remains to be seen if Silva can convince enough voters that she can shake up the status quo and ... Read More

Brazil’s Silva Slightly Widens Lead Over Incumbent Rousseff in Latest Poll

| September 18th, 2014 | No Comments »
Wall Street Journal WSJ-01

By Jeffrey T. Lewis

SÃO PAULO—The latest poll on Brazil’s tight October presidential election shows challenger Marina Silva slightly widened her lead over incumbent Dilma Rousseff in voting intentions for the country’s October presidential elections, but the two still remain in a statistical dead heat.

Ms. Silva would win the runoff election between the two with 43% of the vote, compared with 40% for Ms. Rousseff, according to the survey by the Ibope polling agency for the Globo television network and the Estado de S. Paulo newspaper. In the previous poll by Ibope Ms. Silva led Ms. Rousseff by 43% to 42%. Both surveys have a margin of error of two percentage points.

... Read More

Challenger Upends Brazilian Race for Presidency

| September 18th, 2014 | No Comments »
The New York Times

By Simon Romero

RIO DE JANEIRO — When Dilma Rousseff and Marina Silva were both cabinet ministers, they clashed on everything from building nuclear power plants to licensing huge dams in the Amazon.

Ms. Rousseff came out on top, emerging as the political heir to President Luiz Inácio Lula da Silva and ultimately succeeding him as president. But she now finds herself locked in a heated race with Ms. Silva, an environmental icon who is jockeying for the lead in polling ahead of the Oct. 5 election as an insurgent candidate repudiating the power structure she helped assemble.

Ms. Silva’s upending of the presidential race is a symbol of the antiestablishment sentiment that has roiled Brazil, including anxiety over a sluggish economy and fatigue with political corruption. Her rising popularity also taps into shifts in ... Read More

Argentina summons US diplomat over ‘default’ comment

| September 18th, 2014 | No Comments »
Business Insider

Buenos Aires (AFP) – Argentina summoned the acting American ambassador over his comments on its failure to repay debt tied up in a US legal battle, protesting his use of the word “default” and accusing him of trampling on the country’s sovereignty.

Kevin Sullivan, the charge d’affaires and top-ranking diplomat at the US embassy in Buenos Aires, told Argentine newspaper Clarin that it was “important for Argentina to exit default as soon as possible to return to the path of growth and attract the investment it needs.”

That touched a raw nerve in President Cristina Kirchner’s government, which denies it is in default and blames the US for failing to rein in a federal judge who has blocked Argentina from paying its restructured debt until it settles its $1.3 billion dispute with two US hedge funds.

Sullivan’s comments were “incorrect, unfortunate and inappropriate,” cabinet chief Jorge Capitanich told journalists.

“They constitute undue interference in ... Read More

Peru’s economy: Replacing the pilot

| September 18th, 2014 | No Comments »
The Economist

FOR a long time, the job of being Peru’s finance minister involved taking plaudits. Thanks largely to commodities exports, the country has been Latin America’s stand-out economic performer. Growth has averaged 6.4% annually over the past decade. Alonso Segura (pictured), who was named as a replacement for his long-serving boss, Luis Miguel Castilla, on September 14th, faces a less enjoyable sojourn in the role.

The new minister began work on the same day that Peru’s GDP numbers for July were released. They showed the economy expanding by 1.2% that month compared to the same month last year—better than the dismal June figure of 0.3%, but still well below forecasts. Mr Segura, a US-trained economist who had served as chief of staff at the ministry since early 2013, admitted in his first interview with the national media that growth this year would probably be below 4% (down from an already ... Read More

AP Interview: Brazil’s Silva Wants Better US Ties

| September 18th, 2014 | No Comments »
The New York Times

By the Associated Press

RIO DE JANEIRO — Marina Silva, a front-running presidential candidate who grew up in the Amazon jungle and could become the first black to lead Brazil’s government, said Wednesday that if elected she’ll improve ties with the U.S. and strongly push for human rights in nations like Cuba.

She spoke exclusively to The Associated Press in her first interview with a foreign media outlet since being thrust into Brazil’s presidential campaign after her Socialist Party’s original candidate died in an Aug. 13 plane crash.

Silva, a former Amazon activist and environment minister who pushed policies that helped Brazil slash the rate at which it was destroying the jungle, has found herself in a dead-heat presidential race with President Dilma Rousseff. The incumbent represents the Workers Party, which Silva herself helped found three ... Read More

Falling oil revenues threaten Colombia GDP, cautions Cárdenas

| September 18th, 2014 | No Comments »
latin finance

Colombia can reach developed country status in the next 12 years, but maintaining production in the oil sector will be vital, says finance minister

Colombia’s annual economic growth could be reduced by a percentage point in coming years if the country sees no major discoveries in the oil sector, Mauricio Cárdenas, the finance minister, has told LatinFinance.

Cárdenas said he is targeting economic growth of 5% or higher over the next four years, in a bid to reach developed country status in the next 12 years, but said the oil sector, source of 20% of fiscal revenues, could be a risk to these ambitions.

“We need to make sure that we are able to sustain or increase production,” said Cárdenas, speaking in the September/October edition of LatinFinance.

A bidding round in Colombia earlier this year for 95 new exploration and production blocks did not attract the hoped participation, with the state oil agency placing only 27 of ... Read More

U.S. Pushes Back Against Warnings That ISIS Plans to Enter From Mexico

| September 18th, 2014 | No Comments »
The New York Times

By Michael S. Schmidt

WASHINGTON — Militants for the Islamic State in Iraq and Syria have traveled to Mexico and are just miles from the United States. They plan to cross over the porous border and will “imminently” launch car bomb attacks. And the threat is so real that federal law enforcement officers have been placed at a heightened state of alert, and an American military base near the border has increased its security.

As the Obama administration and the American public have focused their attention on ISIS in recent weeks, conservative groups and leading Republicans have issued stark warnings like those that ISIS and other extremists from Syria are planning to enter the country illegally from Mexico. But the Homeland Security Department, the F.B.I. and lawmakers who represent areas near the border say there is no truth to the warnings.

“There is no credible intelligence to suggest ... Read More

Venezuela default fears add to Latam woes

| September 18th, 2014 | No Comments »
Gulf Times

Despite sitting atop the world’s largest oil reserves, Venezuela’s government is facing mounting concerns about its solvency, prompting a downgrade that has added to Latin America’s recent economic bad news.

Venezuela owes more than $6.4bn in debt payments in October, equal to one-third of its total declared hard currency reserves.

The overall economic picture is also bleak, with Venezuelans hit by chronic shortages of basic goods, annual inflation of more than 60% and a stricken economy that S&P said risked shrinking up to 3.5% this year.

That prompted the ratings agency to lower Venezuela’s rating one notch on Tuesday, to CCC+, taking the South American country deep into “speculative grade” territory.

S&P warned investors that Venezuela faced “at least a one-in-two likelihood of default over the next two years.”

It gave the country a negative outlook, indicating the strong possibility of ... Read More

AT&T Signals Interest in Mexico as Carlos Slim Unloads Assets

| September 17th, 2014 | No Comments »
Wall Street Journal WSJ-01

By Thomas Gryta

A top AT&T Inc. executive said the company is open to acquisitions in Mexico, where the telephone giant controlled by former partner Carlos Slim is planning to sell assets.

América Móvil has said it would sell off parts of its sprawling operations to cut its market share to below 50% from about 70% to avoid a regulatory crackdown, creating a rare opening for an acquirer to get a foothold in the country.

AT&T’s attention is focused on closing a $49 billion deal for satellite broadcasterDirecTV. But Chief Strategy Officer John Stankey said Mexico is a fast-growing market of interest to the company and that AT&T has the management depth and balance sheet to do other deals if opportunities ... Read More

Argentina Warns of ‘Severe Measures’ Over U.S. Diplomat’s Remarks

| September 17th, 2014 | No Comments »
Wall Street Journal WSJ-01

By Taos Turner

BUENOS AIRES–Argentina’s government scolded a U.S. diplomat on Tuesday for remarks he made about the country’s recent default, implying he could be expelled if he makes similar comments again.

Argentine Foreign Minister Héctor Timerman called for a meeting with the U.S. Embassy’s Chargé d’Affaires, Kevin Sullivan, after Mr. Sullivan told the local newspaper Clarin that “it is important for Argentina to emerge from default as soon as possible to return to the path of sustainable economic growth and attract the investment it needs.”

In a statement, Mr. Timerman said he told Mr. Sullivan, a career diplomat who has ... Read More

Philip Morris Fuming About Uruguay’s Graphic Cigarette Packaging To The Tune Of $25M

| September 17th, 2014 | No Comments »
From Fox News Latino

A pack of cigarettes in Uruguay is not a pretty sight.

Whether you’re a Marlboro man or a Benson & Hedges smoker, if you pick up a pack in the South American nation you will be greeted by an image of decaying teeth, premature babies, horrific hospital scenes or some other terrifying scenario.

These scary snapshots were meant to reduce smoking – and it appears to be working, especially with pregnant women – but they have also drawn the ire of cigarette giant Philip Morris International.

The Richmond, Virginia-based company believes that Uruguay’s requirement to cover around 80 percent of the cigarette packaging with medical warnings and graphic images is a violation of a treaty law and is suing the country for $25 million.

“Philip Morris is saying that the percentage of warning labels that are required on cigarette packs in Uruguay goes beyond what is reasonable to protect people from the harmful effects ... Read More

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