Content from IASW Contributors

Close vote in Brazil reveals a deeply divided nation

By Roger F. Noriega By Roger F. Noriega
Brazil’s President Dilma Rousseff won a second four-year term yesterday, defeating challenger Aécio Neves by a margin of 51.6% to 48.4%. Rousseff waged one of the most negative campaigns in memory, conjuring fears that Neves would cut government anti-poverty programs rather than explaining how she plans to pull the world’s seventh largest economy out of recession.

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-->

Pre-election spending in Brazil: A final splurge

| October 2nd, 2014 | No Comments »
The Economist

That governments splurge in election years is a hallowed democratic tradition. True to form, Brazil’s left-wing administration, led by President Dilma Rousseff who is seeking a second term in an election on October 5th, has gone on a spending spree. Just how big became apparent on September 30th, when the treasury released its August accounts.

The primary deficit (before interest payments) reached 14.4 billion reais ($5.9 billion) in that month, the fourth in a row in which the government has failed to put aside cash to pay creditors. The consolidated primary surplus in the eight months to August stood at just 0.3% of GDP. Most of that came from the states; the central government managed just 1.5 billion reais, a piffling 0.05% of GDP and the worst result for the period since 1998. The overall budget deficit climbed to 4% of output, the highest level since Ms Rousseff’s predecessor and mentor, ... Read More

Mexico: Alleged Drug Boss Beltran Leyva Captured

| October 2nd, 2014 | No Comments »
ABC News

By E. Eduardo Castillo

Military special forces grabbed alleged cartel leader Hector Beltran Leyva during a lightning raid at a restaurant Wednesday, the latest in a string of high-profile drug arrests in the country.

Officials said the purported head of the Beltran Leyva drug gang was captured inside a seafood eatery in the city of San Miguel de Allende, a popular enclave for foreigners and artists in the central state of Guanajuato.

No shots were fired in the brief operation, which culminated an 11-month investigation, federal criminal investigations chief Tomas Zeron said at an evening news conference.

The arrest comes just months after the capture of Joaquin “El Chapo” Guzman, the elusive boss of the Sinaloa cartel, which is considered the most powerful drug gang in Mexico. He was caught in February after more than a decade on the run following his escape from prison.

Mexican authorities say Hector Beltran Leyva, 49, assumed leadership of ... Read More

Venezuelan stores fingerprint shoppers to stop hoarding

| October 2nd, 2014 | No Comments »

CARACAS, Venezuela — The government has begun implementing a novel solution to chronic short supplies of basic goods at its supermarkets: fingerprinting shoppers to prevent hoarding.

Starting in September, consumers at six state-run stores must register their fingerprints, which are scanned to keep track of what they buy. The aim is to limit bulk purchases of 23 basic goods, including flour, rice, milk, sugar, toilet paper, coffee, margarine, oil, chicken, meat, shampoo and detergent.

So far, around 800,000 people have registered their fingerprints, and the government plans to expand the program to other stores.

The initial announcement of the fingerprinting scans was greeted by some protests from consumers fed up with an economy wracked by high inflation and shortages stemming in part from currency controls that have deprived importers of dollars they need to pay for foreign goods.

However, since the system went into effect, it has won praise in some quarters for shortening ... Read More

Cae ‘El H’, líder del clan de los Beltrán Leyva

| October 2nd, 2014 | No Comments »
Milenio Diario


El capo Héctor Beltrán Leyva, El H, líder del cártel que lleva sus apellidos, fue detenido en San Miguel Allende, Guanajuato, por la Unidad de Operaciones Especiales del Ejército, tras 11 meses de investigación de los órganos de inteligencia del gobierno federal.

El H residía en Querétaro y se manejaba con un bajo perfil, haciéndose pasar como un empresario “acomodado”, dedicado a la venta de bienes inmuebles y obras de arte.

Junto con él fue capturado Germán Goyenechea Ortega, operador financiero de la organización delictiva; ambos portaban armas cortas de uso exclusivo de las fuerzas armadas.

Tomás Zerón de Lucio, director de la Agencia de Investigación Criminal de la Procuraduría General de la República (PGR), dijo que el golpe contra el narcotraficante se concretó ayer en un restaurante de mariscos, sin realizarse un solo disparo, culminando exitosamente la operación denominada “Hotel”.

El cártel bajo el mando de Héctor, considerado uno de los más violentos, ... Read More

A Revolution in Green

| October 2nd, 2014 | No Comments »
Foreign Affairs

By Peter Wilson

Early this September, during a shakeup of his cabinet, Venezuelan President Nicolás Maduro made a surprising pick. Rodolfo Marco Torres, his nominee for vice president for the economy,  was a former brigadier general in Venezuela’s army. He had first stepped into politics as head of a state bank in 2005 and had been rising through the civilian ranks since then. Earlier this year, he became minister of finance, and then he made history this past June as the first military officer to join the central bank’s board of directors. Now, after only eight months in the minister’s chair, he will take charge of Venezuela’s battered economy.

Torres is not alone. He is among tens, if not hundreds, of former army officers who have secured high government posts over the past two decades thanks to their loyalty to the late President Hugo Chávez, and his successor, Maduro. These days, the ... Read More

White House moves to deal with child migrant issue

| October 2nd, 2014 | No Comments »
Yahoo News-01

WASHINGTON (Reuters) – The White House announced its intention on Tuesday to establish refugee processing in Honduras, El Salvador and Guatemala to try to deter unaccompanied children from resorting to crossing the U.S.-Mexico border on their own.

The announcement was made in a memorandum to U.S. Secretary of State John Kerry that also said the admission of up to 70,000 refugees to the United States in fiscal year 2015 is justified by humanitarian concerns.

Over the summer, President Barack Obama struggled to contain a border crisis where tens of thousands of children from Guatemala, El Salvador and Honduras showed up illegally, often without parents or relatives, at the Texas border.

Some U.S. lawmakers had recommended the step that the White House took on Tuesday, saying that establishing refugee application programs in the three Central American countries was key to defusing the border crisis.

The 70,000 would be allocated among refugees who are ... Read More

Brazilians May Opt for Experience over Change in Election

| October 2nd, 2014 | No Comments »
Real Clear World-01

This week, Brazil’s stock index dipped sharply and the national currency, the real, slumped after polls showed incumbent Brazilian President Dilma Rousseff securing a lead in the run-up to Sunday’s first round of voting. This reaction by capital markets reflects misgivings about the continuation of statist policies that have dried up jobs, driven up debt and led the world’s seventh-largest economy into a recession.

Although Rousseff has recovered her lead over the 10 other candidates, she will likely fall short of obtaining an outright majority and will be forced into a run-off Oct. 26 against free-market maverick Marina Silva. And while most observers expect Rousseff to win re-election by challenging Silva’s lack of executive experience, the campaign has exposed profound popular doubts about the president’s own management of Brazil’s economy.

Taking over the Socialist Party nomination after the death of governor Eduardo Campos in an August plane crash, Silva appealed ... Read More

Argentina deposits debt payment in defiance of US ruling

| October 1st, 2014 | No Comments »

Argentina has deposited $161m (£99m) in bond interest payments with the state-controlled Nacion Fideicomisos bank, in an effort to skirt US court rulings.

The country had previously kept its funds with US-controlled Bank of New York Mellon.

The move comes a day after a US judge ruled Argentina was in “contempt of court”.

That ruling stated Argentina must repay two US hedge funds before repaying other bond holders.

“By making this deposit, Argentina confirms once again its unshakeable commitment to meet its obligations to bondholders,” said Argentina’s finance ministry in a statement.

Argentina is attempting to pay its bondholders in a second tranche of debt known as the Par series so as to avoid defaulting once more.

However, experts caution that simply placing the debt payment in a non-US controlled bank is probably not sufficient to allow Argentina to avoid a US court ruling barring it from repaying certain debts above others.

Long ... Read More

Chile Government Plans Investment Boost for Flagging Economy

| October 1st, 2014 | No Comments »

By Javiera Quiroga

Chile´s government plans to raise spending 9.8 percent next year, the biggest increase since the 2009 recession, as it looks to revive an economy growing at the slowest pace in more than four years.

The increase is over the expenditure budgeted for this year and will be led by a 27.5 percent jump in investment, President Michelle Bachelet said in a televised address yesterday. The spending plan will help lift growth to about 3.6 percent, Finance Minister Alberto Arenas told reporters today.

The budget, Bachelet’s first since her second presidential term started in March, follows three years of student protests in support of free education, and congressional approval for a bill to raise taxes by three percentage points of gross domestic product. The tax changes, which were signed into law Sept. 26, will raise an extra $2.3 billion for the government next year, Bachelet ... Read More

Brazil’s Cautious Voters

| October 1st, 2014 | No Comments »


MEXICO CITY – Brazil has been in the global spotlight this year, and not always for the right reasons. Following the 2013 riots over the amount of money being spent on the 2014 soccer World Cup, protests continued up to, and even during, the tournament in June. There were dire – though ultimately misplaced – predictions about chaotic conditions for participants, and then, of course, the catastrophic performance of the home team.

Now, the costs of the soccer jamboree, coming on top of the country’s ongoing economic slowdown, are coming home to roost. Several analysts have concluded that Brazil’s bubble has burst, and that the so-called “country of the future” will remain stuck in the present.

Economic uncertainty is also dramatically affecting Brazilian politics. And a once placid, even predictable, presidential election campaign has been ... Read More

Argentina’s Contempt

| October 1st, 2014 | No Comments »
Wall Street Journal WSJ-01 South America’s leading deadbeat nation sets another precedent.

Monday’s ruling by U.S. District Judge Thomas Griesa to hold the Republic of Argentina in contempt of court isn’t entirely without precedent. Russia fell afoul of an American court last year in a dispute involving custody of Jewish religious books. The Democratic Republic of Congo was held in civil contempt in 2009 for failing to comply with a district judge’s discovery request.

Yet the Argentina ruling is in a class by itself. “We all know that to hold a party in contempt of court is a rare thing. I was requested to do so at an earlier stage and declined,” Judge Griesa said Monday. But he said he was compelled to recognize “what is really the illegal conduct of the Republic involving the attempt to unlawfully change and depart from the provisions of the governing injunction.”

The judge is referring to the effort by the ... Read More

Brazil’s election: What you need to know

| October 1st, 2014 | No Comments »
The Globe and Mail-01

By Stephanie Nolan

Sunday’s election has Brazil at a crossroads: After 12 years of rule by the Workers’ Party in which the economy surged, millions of people saw their standard of living rise dramatically and the country enjoyed a new sense of prestige internationally, there is now a strong feeling the good times have ground to a halt. Growth will be less than 1 per cent this year. Inflation is above 6 per cent and rising. There is near full employment, but a pervasive sense of pessimism.

Who’s running for president?

While there are nine candidates, there are three real contenders:

Dilma Rousseff (Workers’ Party): A bureaucrat who won the top job in 2010, she presided over a successful FIFA World Cup but the contracting of the economy. She has a lead of roughly 10 points in the polls.

Marina Silva (Socialist Party): Grew up poor, became an environmentalist who fought alongside Chico Mendes, and ... Read More

After More Than 50 Years, USAID Is Leaving Ecuador

| October 1st, 2014 | No Comments »

By John Otis

BOGOTA, Colombia — Under pressure from Ecuador’s left-wing government, the United States Agency for International Development (USAID) is shutting down its operations in the South American nation after 53 years.

In a telephone interview with GlobalPost, Adam Namm, the US ambassador to Ecuador, called the decision “very disappointing.”

But it was no surprise. The government in Quito had refused to allow Washington’s aid agency to renew its programs or start any new activity in the country.

President Rafael Correa is a fierce US critic who has already pulled the plug on US counter-narcotics operations at a Pacific coast base and expelled Namm’s predecessor as well as 14 US military advisers, whom he claimed were infiltrating Ecuador’s security forces.

Analysts say that the closure of the Agency for International Development, the US government foreign aid wing known as USAID, is part of a broader effort ... Read More

Venezuela’s Currency Hits New Low

| October 1st, 2014 | No Comments »
Wall Street Journal WSJ-01

By Kejal Vyas

CARACAS—Venezuela has hit a new, dubious milestone in its slow-motion economic decline: Its largest banknote, the 100-bolívar bill, is worth just one U.S. dollar, at least on the country’s black market.

On Monday, the bolívar held at 100.68 per dollar, unchanged from Friday when it breached the 100 level for the first time, according to, a significant decline from just 17 per dollar at the start of 2013. tracks the South American nation’s vibrant currency black market, where many Venezuelans go to get greenbacks and which businesses use as a pricing reference.

The country’s smallest bill, the two-bolívar note, is worth just two U.S. cents on the black market. The situation has left Venezuelans carrying large wads of cash everywhere they go, a risky proposition in a country with one of the highest crime rates in the world.

David Varela, ... Read More

Venezuela’s Bondholder Default Anxieties Ease With Citgo

| October 1st, 2014 | No Comments »

By Sebastian Boyd

Venezuelan bonds are rebounding from the deepest losses in emerging markets as President Nicolas Maduro allays concern the country will unload Citgo Petroleum Corp., its U.S.-based unit.

Venezuela’s $5.1 billion of dollar-denominated sovereign bonds tracked by Bloomberg returned 2.6 percent through yesterday since Maduro said Sept. 23 that he’s seeking to “strengthen” Citgo, which has historically played a crucial role in protecting bondholder interests as the nation’s main seizable asset. The rally, the biggest among 55 developing nations, narrowed losses to 12.8 percent this quarter.

With foreign-currency reserves close to an 11-year low and Harvard University economist Ricardo Hausmann questioning its decision to pay bondholders as billions of dollars of arrears fuel record shortages, Venezuela is facing intensifying scrutiny over its ability to pay $5.3 billion of debt due next month. Maduro’s comments helped to soothe investors who saw the state oil producer’s decision to put the U.S. refining unit ... Read More

U.S. must raise stakes to get hostage Alan Gross returned by Cuba

| October 1st, 2014 | No Comments »
The Miami Herald

By Frank Calzon

Confronted with the barbaric beheadings of journalists James Foley and Steven Sotloff by the terrorists of the Islamic State, President Obama has rightly changed course and announced a new strategy.

After six lackluster and bewildering years, the president would do well to reappraise his strategy for dealing with Cuba and North Korea, as well. Cuba is still holding hostage a USAID contractor. Alan Gross is ill and has lost 100 pounds in harsh Cuban prisons.

Havana wants “to exchange” Gross for release of Cuban spies in U.S. prisons who have been convicted of “conspiracy to kill U.S. nationals, destruction of aircraft, and murder.” They not only infiltrated Florida military bases, but also set up the killing of four Miami men, members of Brothers to the Rescue, who were flying unarmed civilian aircraft over the Florida Straits to spot fleeing Cubans aboard rafts in need of help.

Raúl Castro, now president of ... Read More

White House moves to deal with child migrant issue

| October 1st, 2014 | No Comments »
Yahoo News-01

WASHINGTON (Reuters) – The White House announced its intention on Tuesday to establish refugee processing in Honduras, El Salvador and Guatemala to try to deter unaccompanied children from resorting to crossing the U.S.-Mexico border on their own.

The announcement was made in a memorandum to U.S. Secretary of State John Kerry that also said the admission of up to 70,000 refugees to the United States in fiscal year 2015 is justified by humanitarian concerns.

Over the summer, President Barack Obama struggled to contain a border crisis where tens of thousands of children from Guatemala, El Salvador and Honduras showed up illegally, often without parents or relatives, at the Texas border.

Some U.S. lawmakers had recommended the step that the White House took on Tuesday, saying that establishing refugee application programs in the three Central American countries was key to defusing the border crisis.

The 70,000 would be allocated among ... Read More

Brazil Leader Regains Edge in Election Polls

| September 30th, 2014 | No Comments »
Wall Street Journal WSJ-01


SÃO PAULO—Two new electoral polls show Brazilian President Dilma Rousseff widening her lead over her main challenger in a likely second-round runoff, surveys that disappointed many investors who hope for the incumbent’s ouster.

The leader would get 49% of the vote in a head-to-head showdown with Socialist Party candidate Marina Silva in late October, said a survey released Tuesday by polling firm Datafolha. Ms. Silva would capture 41% of the likely vote, according to the poll, which has a 2 percentage point margin of error.

A second survey by the Ibope polling agency showed a much tighter race, with Ms. Rousseff gaining 42% of the second round vote compared with 38% for Ms. Silva. That is considered a statistical tie, given the poll’s 2 percentage point margin of error.

Still, the momentum favors Ms. Rousseff, who has gained ground over her rival in three recent polls, including the most recent ... Read More

Inicia operaciones el Fondo Mexicano del Petróleo

| September 30th, 2014 | No Comments »
Milenio Diario

Ciudad de México

El secretario de Hacienda, Luis Videgaray anunció que a partir de este martes queda constituido el Fondo Mexicano del Petróleo, que contribuirá a la estabilidad de las finanzas públicas en el largo plazo.

A través de este fondo se busca dar transparencia al manejo de los recursos que deriven de la renta petrolera, además de dar certeza a las futuras generaciones de que en el futuro estará garantizado el desarrollo.

Además de anunciar la creación del Fondo Mexicano del Petróleo, el secretario de Hacienda anunció la creación de tres instrumentos cuyo objetivo es acercar a los pequeños ahorradores a las oportunidades inversión que representa la reforma energética.

Participación de Banxico

La constitución del Fondo Mexicano del Petróleo demanda la participación del Banco de México al ser el fiduciario.

El titular del banco central, Agustín Carstens, dijo que es estimulante ser el fiduciario en cumplimiento de un mandato constitucional.

El banco central, ... Read More

Slim Enriches Himself With Breakup He Resisted: Corporate Mexico

| September 30th, 2014 | No Comments »

By Ben Bain

Carlos Slim, the billionaire who successfully protected a telecommunications monopoly in Mexico for more than two decades, scored one of his biggest financial windfalls by finally giving into the government.

Shares of Slim’s America Movil SAB (AMXL) have soared 24 percent this quarter, the biggest gain in five years, as the company said in July it would sell assets worth about $17.5 billion amid a push by lawmakers and regulators to force competition on the country’s dominant phone companies and broadcasters. The stock’s advance was almost four times the average for emerging-market telecommunications companies, data compiled by Bloomberg show.

Slim, 74, who owns 57 percent of America Movil, has seen his personal wealth jump $6.6 billion this year to $80.3 billion, gaining on the world’s richest man, former Microsoft Corp. co-founder Bill Gates. The son of a Lebanese immigrant, Slim built his fortune by buying the government-run telephone utility ... Read More

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