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.
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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-->

Argentina edges closer to default

| July 1st, 2014 | No Comments »
The Economist

Event

Constrained by a US court ruling that forces it to repay litigant holdout creditors (who did not participate in 2005 or 2010 restructurings) when it makes payments to current creditors, and in the absence of a negotiated repayment deal with the holdouts, Argentina failed on June 30th to meet a coupon payment to holders of restructured bonds issued under New York law.

Analysis

It had become increasingly evident in the days leading up to the June 30th deadline that the payment would not be made. Argentina had transferred the necessary funds to its payments agent in the US, Bank of New York Mellon, during the previous week, asserting that it had therefore met its obligations. However, it was always clear, under the terms of the US court ruling, that the bank would not be able to transfer the funds to the intended creditors without some sort of provision for repayment of the holdouts. ... Read More

Argentina Faces a Deadline for Hedge Fund Payments

| July 1st, 2014 | No Comments »
The New York Times

BY PETER EAVIS

Argentina’s government has 30 days to decide whether it should try to make peace with a group of New York hedge funds that it has bitterly fought for years in a dispute that could change the global market for government bonds.

The hedge funds, after a series of important victories in United States courts, have managed to back Argentina into a daunting legal corner. Judge Thomas P. Griesa of the Federal District Court in Manhattan has told the country that it cannot make payments on its main class of foreign bonds without also paying the defaulted bonds that the hedge funds hold.

Argentina was scheduled to make a payment to its main bondholders on Monday. The country had put $539 million in theBank of New York Mellon, but the bank, not wanting to violate the court order, had said that it would not pass on the money to the bondholders.

The bonds now ... Read More

Making Everything Shipshape

| July 1st, 2014 | No Comments »
The New York Times

BY DIONNE SEARCEY

As construction crews 5,000 miles away are working to widen the Panama Canal to allow much larger ships to sail straight to the East Coast, this historic port city and others along the West Coast are doing everything they can to avoid becoming superfluous.

The Port of Tacoma is determined to keep up its rich import business, which can be traced to the 1880s when chests of tea from Asia arrived at its docks and headed to the East Coast by rail. Port officials know that by the time the Panama Canal opens in 2016, an even newer, larger fleet of cargo ships will be plying the oceans and will be so big they will not be able to squeeze through even the wider channel.

So Tacoma, Seattle and other ports are spending billions to be ready to receive the ships and keep themselves ... Read More

Opinion: Venezuela, Is The Mutiny Underway Against Maduro?

| July 1st, 2014 | No Comments »
World Crunch-01

As if Venezuela’s 1,001 endemic problems (economic and social, corruption, crime and state repression) were not enough. Now the socialist government of President Nicolás Maduro faces mutiny in its own ranks, which highlights — not for the first time — the difference in charisma and authority between Venezuela’s late leader Hugo Chávez, and his successor.

The impact of Maduro’s declarations, made days ago in a vigorous speech to members of the United Socialist Party of Venezuela (PSUV), have yet to be seen. Speaking in combative terms, he declared that “nobody will take us away from the work Commander Chávez bequeathed us [...] neither the subversive Right nor the outdated Left.”

He dismissed his critics as being “disloyal” elements, who had “failed, one and all, when they were ministers.”

The chief target of the president’s furious jabs was the ousted Minister of Planning Jorge Giordani, who has in various ministries and within the bounds of Marxist ... Read More

Ecuador newspaper ends print edition after ‘persecution’

| June 30th, 2014 | No Comments »
From AFP

An opposition newspaper in Ecuador said Sunday it was ceasing publication of its print version after more than three decades, claiming persecution from the government.

Starting Monday, the 32-year-old daily Hoy will only be available online after it said it was the target of a law regulating the press adopted last year at the initiative of socialist President Rafael Correa, which it said “limits in a discriminatory way national investment in media.”

The newspaper cited, in particular, a “permanent boycott in advertisements” and “other limitations to funding our operations.”

In power since 2007, Correa, a prominent leftist figure in Latin America, has long clashed with private media, which he accuses of trying to oust his government. The president has on several occasions taken newspapers to court.

“The gradual loss of liberties and the limitation of constitutional guarantees suffered by Ecuador, the self-censorship forced by the law on communication, the repeated attacks, direct or indirect, ... Read More

Who Will Maduro Blame for Venezuela’s Blackout This Time?

| June 30th, 2014 | No Comments »
The Daily Beast

When it rains, it pours. This is particularly true in Caracas, where each year a fortnight of heavy downpours known colloquially as El Cordonazo de San Francisco (the lash from St. Francis of Assisi’s belt) deluges the Venezuelan capital, and heralds the advent of tropical winter. Currently, President Nicolas Maduro, the handpicked socialist scion to Hugo Chávez, likewise seems to be receiving his own heavy drenching, drawing heavy ire from critics on both the left and right, and seemingly in a constant state of damage control.

Where his predecessor managed to consolidate presidential control to heights unknown in Venezuela since its early 20th-century dictatorships, Maduro has struggled to solidify his authority throughout the first year of his tenure. Unable to evict Chávez’s daughters from the presidential palace, he was relegated to less lofty vice presidential quarters from the outset. Meanwhile, policymaking has been largely defined by a group of political party ... Read More

Brazil: Major economic draw, major headache

| June 30th, 2014 | No Comments »
USA TODAY

BY ALAN GOMEZ

Felipe Berer has ridden the entire Brazilian wave.

It started in 2010, when the financial world fell in love with Brazil. After a decade of solid growth, the country’s economy exploded with a staggering 7.5% increase in output that year. Tens of millions of people were entering the middle class — and the consumer market — and foreign businesses were racing to get in on it.

“Most people thought the future had arrived,” said Berer, who was shipped from Miami to his native Brazil to help his law firm, Akerman, establish itself there. “The question everybody had was, ‘Is this sustainable or not?’”

It was not. The commodity prices that had largely spurred Brazil’s growth leveled off. The economic rise that had pushed so many out of poverty became a drag — government spending on roads, hospitals, education and other public infrastructure couldn’t keep up, leading to gridlock everywhere. The International ... Read More

Argentina’s debt fight: Why it matters

| June 30th, 2014 | No Comments »
Article originally appeared in the Associated Press

BY MATTHEW CRAFT

Time to resolve Argentina’s long battle with creditors is running out.

Argentina owes an interest payment to the majority of its creditors on Monday, though the government has a 30-day grace period after that to avoid going into another catastrophic default.

Last week, the U.S. Supreme Court ruled against Argentina, letting stand a lower court ruling that it must pay off hedge funds that own bonds left over from the country’s default in 2001. President Cristina Fernandez has said Argentina couldn’t afford to pay them while also making regular interest payments to other lenders.

On Friday, a federal judge pleaded with Argentina to continue negotiating with the hedge funds. At the same time, the judge called Argentina’s attempt to make its regular interest payment illegal.

One misstep and Argentina could slide into another default, 13 years after a record $100 billion default devastated its economy.

Just how did Argentina wind up in this ... Read More

Caribbean drug flow increases concern U.S.

| June 30th, 2014 | No Comments »
The Miami Herald

BY JACQUELINE CHARLES

For years, Caribbean governments have voiced concerns that U. S. counter-narcotics efforts in Mexico and Central America would force drug traffickers back into their region to push their products on go-fast boats and cargo ships. Those fears are being realized as a top State Department official said the U.S. is concerned about disturbing increases in drugs flowing through the Caribbean over the past there years.

“I do not wish to suggest that the amount of product flowing through the Caribbean even remotely approaches the levels of Central America and Mexico,” said William Brownfield, assistant Secretary of State for International Narcotics and Law Enforcement Affairs. “The disturbing thing is the trend line.”

Brownfield’s comment came just days ahead of the United Nation’s International Day Against Drug Abuse and Illicit Trafficking in which foreign governments are asked to reflect on drug fighting efforts. It also comes on the heels of a visit earlier ... Read More

Eric Farnsworth on China-Latin America relations

| June 30th, 2014 | No Comments »
CCTV America

To discuss the increasing importance of China and Latin America’s relationship, CCTV’s Elaine Reyes sits down with Eric Farnsworth, who is the Vice President of the Council of the Americas and Americas Society.

The China National Petroleum Corporation (CNPC) plans to invest two-billion dollars in Peru over the next decade and potentially build a gas pipeline in the country.

The CNPC’s planned investment is another bid to expand its economic presence in South America. The region has become essential in China’s geo-political strategy. And it’s no coincidence that it spends 13% of all its foreign investment in Latin America. Chinese President Xi Jinping has planned a visit to Brazil in July to attend the BRICS summit.

Click here to view video.

Click here for ... Read More

Devaluing the Bolivarian revolution

| June 27th, 2014 | No Comments »
The Economist

AFTER months of opposition protests that it portrays as a “fascist coup”, the government of Nicolás Maduro has reason for grim satisfaction. Using crude, but selective, repression, Mr Maduro has fought the protesters to a state of exhaustion. More than 40 people have been killed, most of them by government agents. The leaders of the opposition’s radical wing are either in jail or have been deprived of a public platform. The president has made none of the concessions the opposition seeks—the freeing of political prisoners and the restoration of bipartisanship to the media, the electoral authority and the courts.

So confident is the regime of its political grip that the ruling United Socialist Party of Venezuela plans to hold a congress next month at which Mr Maduro is likely to be installed as its head—a post still formally held by the late Hugo Chávez, who was also Venezuela’s president until his ... Read More

Ecuador ruling party proposes end to presidential two-term limit

| June 27th, 2014 | No Comments »
Article originally appeared in Reuters

BY ALEXANDRA VALENCIA Ecuador’s ruling political movement presented to the national assembly on Wednesday on a controversial plan to end a two-term limit for the re-election of the president, give new powers to the military and increase oversight of the country’s media.

The opposition has fiercely criticized the proposed package of at least 17 reforms to the 2008 constitution with possibly more to follow, which the ruling Alianza Pais (AP) presented to the national assembly where it has a majority.

“All of us AP assembly members have decided to present this initiative,” Marcela Aguinaga, the assembly’s vice-president told reporters.

The proposals will require approval by the Constitutional Court before legislators can begin to discuss the proposals.

The Alianza Pais’ proposal aims to enable President Rafael Correa to seek re-election in 2017 when his second five-year mandate expires, and give him more time to implement his broadly supported socialist program.

Correa has brushed off criticism that ... Read More

Mitsui Aims to Tap Mexico’s Oil and Gas

| June 27th, 2014 | No Comments »
Wall Street Journal WSJ-01

BY MARI IWATA

One of Japan’s biggest energy investors has its eye on Mexico’s oil and natural gas assets, which the country moved to make accessible to foreign firms for the first time in more than 75 years late last year.

Yasuhiro Uchida, a general manager of oil and gas development at Mitsui 8031.TO -0.92% & Co.’s Energy Business Unit I, said the company was “very interested” in investing in the country.

“Mexico has good prospects, large energy reserves, easy access to almost anywhere in the world and free trade agreements with major economies. It also has a young population that will boost growth in the future,” Mr. Uchida told The Wall Street Journal in an interview on Friday.

Mexico is thought to have unexploited oil and gas assets on land and offshore in conventional and shale reserves. Mitsui is looking in particular at shale reserves which span the Texan border with Mexico and ... Read More

Action by Argentina Seems to Defy Judge’s Order on Bond Payments

| June 27th, 2014 | No Comments »
The New York Times

BY PETER EAVIS

Argentina made a puzzling and potentially provocative move on Thursday in its landmark legal battle with New York hedge funds, which are suing the country over bonds that it defaulted on over 10 years ago.

Judge Thomas P. Griesa of the Federal District Court in Manhattan has ruled that Argentina cannot make payments to its main class of bondholders without also paying the hedge funds what they say they are owed.

But on Thursday, Argentina announced that it had deposited $539 million with the Bank of New York Mellon, for the purpose of paying its main bondholders. A payment is due on their bonds on June 30. Confusing matters, Argentina had recently said it was “impossible” to make that payment.

Argentina’s motivation for moving the money to Bank of New York Mellon, the trustee handling the bond payments, was unclear. By taking a clear step toward paying the main bondholders, Argentina risks further provoking ... Read More

Central America’s Security Crisis is the United States’ Problem, Too

| June 26th, 2014 | No Comments »
Foreign Policy

With the Obama administration scrambling to address the “humanitarian crisis” of thousands of unaccompanied children crossing the U.S. southern border, let’s hope it has learned a sobering lesson about how presumably well-meaning (and politically expedient) words and actions on a such a hot button issue as immigration can have serious real-world consequences. Whatever the administration was trying to say or do over the past few years on immigration reform got lost in translation to thousands of Central American families whose only hope in life is to make it to the United States to find safety, security, and a decent day’s wage.

Reports are that the number of unaccompanied minors, primarily from Guatemala, Honduras, and El Salvador, detained at the border has more than tripled since 2011, with most of them believing — manipulated by unscrupulous human traffickers –that some sort of legal status awaited them.

As one regional expert told the Washington Post, what the ... Read More

Immigrant ‘Stash Houses’ Thrive Along Texas-Mexico Border

| June 26th, 2014 | No Comments »
Wall Street Journal WSJ-01

BY ANA CAMPOY

Sgt. Rolando Garcia sat in a surveillance van earlier this month, staking out a white wooden house surrounded by sprawling cactus in this city of 35,000 residents near the U.S.-Mexico border.

He wasn’t looking for signs of drugs or weapons, but for evidence that it was a stash house packed with illegal immigrants, the hottest illicit commodity for smugglers on the Texas border.

Human smuggling is nothing new along the U.S.-Mexico boundary, but federal, state and local officials report a rise in Texas in recent months, as thousands of Central Americans sneak into the country—including many unaccompanied children. The migrants are overwhelming authorities along the Rio Grande.

The criminal networks being uncovered in Texas involve large groups of immigrants—and increasingly brazen smugglers. They often hold migrants hostage and threaten them with brutality if their friends or relatives don’t produce extra money to release them, authorities said. Sometime, they kidnap migrants from ... Read More

Bolivia rebels at rightist timepieces, flips clock

| June 26th, 2014 | No Comments »
Article originally appeared in the Associated Press

BY CARLOS VALDEZ

Bolivia’s leftist government is turning back the clock. Or, more precisely, turning it backward.

The government this week flipped the clock atop the Congress building so that while it’s accurate, the hands now turn to the left, a direction known elsewhere as counterclockwise.

Foreign Minister David Choquehuanca announced the modification Tuesday. He said it was only logical that a clock in the Southern Hemisphere should turn in the opposite direction of a Northern Hemisphere clock.

The president of Congress, Marcelo Elio, on Wednesday called the reform “a clear expression of the de-colonization of the people” under President Evo Morales, who became the country’s first indigenous president when he won office in 2005 and is up for re-election in October.

Vice President Alvaro Garcia said the government is thinking about similarly modifying all clocks at public institutions.

He recalled that during an open-air Cabinet meeting, Choquehuanca placed a stick in the ground and showed ... Read More

Hedge Fund vs. Sovereign

| June 25th, 2014 | No Comments »
Foreign Affairs

How U.S. Courts Are Upending International Finance

By Felix Salmon

There aren’t many institutions powerful enough to bring a sovereign nation to its knees. Most of those that are wield their power with great care; the rest are dangerous fundamentalists. Last week, the U.S. Supreme Court placed itself — and the rest of the U.S. federal judicial system — squarely in the latter camp when it refused to accept an appeal by Argentina against a lower-court decision. The consequences are certain to be dreadful for Argentina. More broadly, the ruling will make it more difficult for countries to free themselves from the burden of over-indebtedness. It will be very bad for international capital markets. Oh — and it will also diminish national sovereignty.

The case involved Argentina and a group of so-called vulture funds, led by the deep-pocketed and highly litigious hedge fund Elliott Associates, which was demanding repayment in full on old Argentine ... Read More

Removal of Giordani confirms splits within ruling party

| June 25th, 2014 | No Comments »
The Economist

Event

The president, Nicolás Maduro, removed the long-serving planning minister, Jorge Giordani, the main architect of “chavista” economic policy and a leading member of the ruling Partido Socialista Unido de Venezuela (PSUV), in mid-June. Mr Giordani responded with an open letter accusing the president of lacking leadership qualities and of being responsible for the country’s economic crisis.

Analysis

Since Mr Maduro’s election in April 2013, Mr Giordani’s influence over day-to-day financial and economic decisions has been waning. However, his removal was significant, defying many of the party’s radical left, who saw him as a guardian of the legacy of the former president, Hugo Chávez (1999-2013). The minister of university education, Ricardo Menéndez, will take over from Mr Giordani, but most responsibility for economic policymaking now lies in the hands of Rafael Ramírez (the oil minister and vice-president of the economy).

The departure of the planning minister has been seen by some as heralding a move towards more ... Read More

USA, Mexico and Central American Cross-Border Security Threats

| June 24th, 2014 | No Comments »
Mexi Data

BY JERRY BREWER

From the borders of the northern tier nations of Central American in this hemisphere, and further north to Mexico and the U.S. border, a diverse mix of irregular, terrorist-like, conventional, and organized criminal capabilities continue to be employed asymmetrically with increase and domination.

The escalating threats to human life and property now know no boundaries within these regions, as well as an aggressive disregard for even the slimmest elements of the rule of law or any respect for neighboring nation’s borders.

Governments appear to have lost any ability to apply coherent and cognitive capabilities or strategic approaches to properly understand, assess and meet these criminal insurgent threats, and the violent and bloody conflicts.

Proactive approaches require agility, speed, and an acute focus towards stopping the ritual slaughter throughout these regions of the Americas. Murder with impunity has claimed the lives thousands of innocents; policemen, senior police and other government officials, as ... Read More