CFK to Nationalize Argentina's Largest Oil Company

In a move that the Wall Street Journal says “marks a watershed in expanding the state's grip on the economy,” Argentine President Cristina Fernandez de Kirchner has unveiled a plan to nationalize the country’s largest oil company, Yacimientos Petrolíferos Fiscales (YPF). In televised address yesterday,  Fernandez said she would call upon lawmakers to approve a bill which would nationalize a 51% controlling interest of YPF, owned by Spanish company Repsol.  The president did not immediately say how the government could compensate Repsol for its shares.

As the L.A. Times reports, the announcement has caused a diplomatic crisis between Argentina and Spain, with Spanish Foreign Minister Jose Manuel Garcia-Margalla warning that his government would take "clear and convincing" retaliatory measures as a response.

While the bill authorizing nationalization will likely have to wait several weeks before it is approved by Congress, which Fernandez’s party controls with a working majority, the president took over management of YPF immediately. In an executive order, Fernandez replaced YPF CEO Sebastian Eskenazi with Planning Minister Julio De Vido, who will run the company with the help of Deputy Economy Minister Axel Kicillof.

The jury is still out on the effect that the nationalization will have on the Argentine economy. The government, for its part, claims that the move is necessary because Repsol has failed to invest in domestic production. As The Guardian points out: 

“Governors of oil-producing Argentine provinces have withdrawn about 15 oil leases, representing 18 percent of YPF's crude production, alleging the company failed to keep its promises to develop them. YPF has countered that it has invested millions in those areas and plans to increase production, but Argentine officials have said that still falls short.”

The Fernandez government claims that the nationalization is only a matter of “energy self-sufficiency,” pointing to the fact that the country has become a net importer of energy despite the fact it has the world's third-largest reserves of shale hydrocarbons.

However, others say that this is due to the government’s more interventionist approach to the economy, which they say discourages investment.  The Economist supports this view, and adds that the move will likely dispel investment further, hastening the decline of domestic production.

News Briefs

·         Although President Barack Obama wrapped up his visit to Colombia by certifying the country’s labor protection efforts and allowing the US-Colombia FTA to take effect on May 15, unknot everyone is convinced that Colombia has met its obligations under the Labor Action Plan. AFL-CIO President Richard Trumka said the announcement was “deeply disappointing and troubling,” noting that some two dozen labor organizers were killed in the country last year alone. Colombia Reports profiles a similar response by Colombian union leaders, and Upside Down World takes a look at the links between anti-union violence and neo-paramilitary groups.

·         Speaking at a press conference following a meeting with Brazilian officials in Brasilia on Monday, Secretary of State Hilary Clinton seemed to voice more support than usual for the idea of Brazil gaining a permanent seat on the UN Security Council. Clinton told local press "it would be hard to imagine a security council without a country like Brazil," but stopped short of endorsing the country’s immediate entrance.

·         Although the Peruvian government managed to pressure Shining Path guerrillas into releasing the 36 oil workers held hostage last week, the rebel group may have taken two police officers prisoner during an armed confrontation over the weekend.  While the government has not confirmed this, the AP claims that relatives of the officers were told that they were lowered from a helicopter that came under fire and was forced to retreat.

·         The BBC reports that a 24-hour standoff between police and inmates in Brazil’s Aracaju prison came to an end with the prisoners releasing their hostages and officials promising to investigate reports of mistreatment. As with so many other Latin American prisons that have seen riots in recent months, the Aracaju facility is vastly overcrowded, holding twice its intended capacity of 2,000 prisoners.

·         The US and Haitian governments, along with the help of international institutions, have launched an ambitious vaccination drive on the Caribbean island this week. AP reports that the campaign seeks to vaccinate 90 percent of Haiti's youth population, and is part of a broader push to encourage Haitians of all ages to seek immunizations.

·         The L.A. Times highlights the growing “generational gap” in Cuba. Although President Raul Castro’s economic reforms have benefited older Cubans, many youths report feeling frustrated by a lack of economic and political opportunities.

·         AP with an update on Josefina Vazquez Mota’s unsuccessful efforts to muster a comeback in Mexico’s presidential race. Despite shaking up her campaign last week, it seems the PAN candidate shows no signs of cutting into the widening 20-point lead held by the PRI’s Enrique Peña Nieto.

·         After Mexico’s Chamber of Deputies passed a national climate-change bill last week, the country is poised to impose binding emission reduction goals on successive governments. The Executive Director of Berkley’s Center for Law, Energy & the Environment offers a helpful breakdown of the legislation, noting that “Mexico’s natural abundance of sun and wind make it well-positioned to develop renewable energy technology.” La Jornada says that some in the country have criticized the bill, claiming that it paves the way for privatization of the energy sector.

·         The Miami Herald claims to have gained access to internal memos which show that the Venezuelan government’s decision to close its consulate in Miami earlier this year was intended as retaliation against wealthy Venezuelans in the area, most of whom are fervently anti-Chavez.

·         The BBC highlights the first-ever Harley Davidson motorcycle convention in Cuba, where “having a gathering dedicated to these icons of American engineering…would have been unthinkable 20 years ago.” 

Summit of the Americas Sees Right, Left Call for Cuba Invite

The Sixth Summit of the Americas in Cartagena, Colombia, ended without a final declaration of consensus, as attendees were divided over whether to allow Cuba to attend the next meeting.

Argentina’s Cristina Kirchner wanted her country’s claim over the Falklands Islands to be part of the final declaration, while various attendees wanted Cuba to attend future summits, both of which the US and Canada opposed.

Countries from across the political spectrum have called for Cuba to be included, from leftist leaders in Venezuela, Ecuador and Panama to conservatives in Mexico and Colombia. President Barack Obama gave no ground, however, saying that Cuba would need to reform in order to attend the summit, which is restricted to democratic leaders. Host President Juan Manuel Santos, a close US ally who is considered to have averted a regional crisis over the issue by visiting Havana and talking to Raul Castro, had strong words for the US, saying, “There is no justification for that path that has us anchored in a Cold War, overcome now for several decades.”

Meanwhile Cuban dissident groups made a public call for the country to keep being excluded from the summit unless there is political reform, reports EFE.

For the Financial Times, divides over Cuba and over the Falklands Islands

illustrated the region’s growing economic interdependence even as Latin America feels increasingly emboldened to go its own way politically.

The Washington Post notes that the summit was calmer than some previous ones, due to an absence of the most anti-US leaders. Venezuela’s Hugo Chavez was unable to come to the summit due to health problems, while both Nicaragua’s Daniel Ortega and Ecuador’s Rafael Correa failed to attend, with Correa boycotting over the lack of invitation for Cuba. It pointed out however that the failure to bridge gaps between the US and rising southern powers meant that there may not be a seventh summit, currently scheduled for Panama in 2015.

Another piece in the WP says that Obama’s domestic campaign themes -- jobs, and the role of the government in alleviating poverty -- resonated at the summit, as the questions of economic inequality and job creation are key issues across the hemisphere, as Latin America is home to a growing middle class.

The question of drug policy reform was raised by Colombian President Juan Manuel Santos, who called for a debate on the issue “without prejudice,” and said that fighting the drug war could feel like riding a stationary bicycle.

As expected, Obama expressed US opposition to drug legalization, noting that a legal drug trade could be as much of a corrupting force as an illegal one, while allowing that it was a legitimate topic for discussion, reports the Wall Street Journal. He held private meetings on drug policy with both Guatemala’s Otto Perez, who has brought the subject to worldwide attention since he came to office in January and called for a fresh look at the issue, and with Peru’s Ollanta Humala, who has backed the US position against legalization.

The Miami Herald points to rising protectionism in the region as a topic that dominated private meetings at the summit, with many worried by Brazil and Argentina’s trade policies, amongst others.

Amid the criticism of the summit’s failures, Bloggings by Boz points to an overlooked success -- that all countries approved Mexico’s proposal for a single Inter-American System Against Organized Crime. This will involve the creation of a body to oversee and harmonize regional policy against organized crime by governments and bodies in the region, including the OAS, reports Animal Politico. More from El Faro.


News Briefs

• The long-brewing free trade agreement between Colombia and the US will come into effect on May 15, Obama and Santos announced at a joint conference in Cartagena, reports the WSJ. The agreement was signed by George W. Bush and Alvaro Uribe in 2006, and ratified by Congress last year. It had been held up in part by concerns over labor rights in Colombia, and is coming into effect now after Obama certified the country’s efforts to improve protection of workers' rights. The move has been criticized by US unions, who say Colombia needs to make more progress on the issue. Human Rights Watch noted in October that Colombia still sees more unionists murdered than any other, and that the majority of these crimes go unpunished. In 2010, more than half of the 90 unionists killed worldwide were Colombian, according to the International Trade Union Federation. Four unionists have been killed since January, reports Colombia Reports. WOLA told CR that the finalization of the trade pact would reduce the US government’s leverage to press Colombia to increase workers’ protections.

• Another issue casting a shadow over the summit was a scandal over 11 of Obama’s Secret Service personnel and five military being accused of bringing prostitutes back to their hotel. The events came to light because of hotel rules that say guests must leave by 7 a.m., reports the NYT. On Thursday morning police were called because a Secret Service agent who had a woman in his room refused to open the door to hotel management. When the police arrived, the sex worker complained that she had not been paid, according to thechairman of the House Homeland Security Committee. The entire team has been replaced, the Secret Service said Friday, amid allegations that others had also brought prostitutes back to their rooms. Committee head Peter T. King explained that, though prostitution was legal in Cartagena, it was against agency rules of conduct, as it could expose the agents to blackmail, or help enemies get inside a security perimeter. Obama said he would be angry if the allegations were true, as the agents were representing their country, reports the NYT.

• Peruvian rebel group the Shining Path has freed 36 hostage gas workers, who had been held hostage for five days. The workers, contractors for Swedish company Skanska, were kidnapped en masse on Monday from a remote village in the Cusco region, and rebels demanded $10 million for their release. On Saturday morning, the hostages walked into another village in the region, still wearing their orange work uniforms and saying they had walked for seven hours after being freed by the guerrillas at 4 a.m., reports the AP. The government denies that any concessions were made to bring about the release, and said that military pressure forced the group to free their hostages. Some in the country have questioned the authorities’ version of events, with analyst Jaime Antezana telling media that, according to his sources, $5 million was handed over to the rebels by the contracting companies. At least three members of the Peruvian security forces lost their lives in the rescue mission. 

• On Saturday El Salvador saw its first day in three years without a single murder, reports the Guardian. The country has one of the highest murder rates in the world, averaging 13 a day in February this year, but the rate dropped dramatically in early March, following a controversial pact between the MS-13 and Barrio 18 gangs. The government denies offering concessions to gang leaders in exchange for a drop in murders, though it seems clear that the authorities were involved in the truce.

• El Faro looks at the Salvadoran government’s decision to take the provision of security in prisons out of the hands of soldiers. The government says this happened for humanitarian reasons, but the website, which broke the story of the alleged gang deal in March, notes that the move could be related to deals with imprisoned gang leaders.

• Brazil’s Supreme Court has ruled to allow women to terminate pregnancies when the fetus lacks a brain, reports the AP. Abortion is illegal in Brazil, except where the woman has been raped or where her life is in danger if the pregnancy continues. Reuters points out that President Dilma Rousseff was forced to back away from her support for abortion rights in order to win the election in 2010. There are estimated to be 1.4 million abortions carried out in the country each year, most of them illicit, giving it a higher rate of terminations than the US. A quarter of a million women suffer health complications from these illegal operations in the country each year.

• Via InSight Crime, an investigation by Plaza Publica into the techniques of money smugglers who take illicit cash out of Guatemala and into countries like Panama for laundering.

• Mary Anastasia O’Grady at the WSJ argues that Brazil should stop complaining about US monetary policy, whose low interest rates push up Brazil’s currency, as allowing the real to increase would give the country more purchasing power abroad.

• McClatchy Newspapers reports on hitchhiking in Cuba, which it says is the only way to get around the countryside for most people, with gas at prices that are unaffordable on government salaries. The reporter traveled around the island picking up hitchhikers and asking them their opinions about the country, finding that many were finding times tough as the government cuts back jobs and subsidies, while none could name a possible successor to the Castro brothers.

• The LA Times blog looks at the case of a premature baby who was declared dead by doctors in Argentina, before being found alive by her mother in a morgue hours later. According to one doctor, what may have happened is that the baby had a very low heart rate which doctors could not detect. When she was transferred to a cold area of the morgue, this “may have allowed the baby to survive by cooling the metabolic rate so much that the organs of the body don’t need as much oxygen and nutrients.”

Examining the Origins of Mexico’s Child ‘Drug War’ Video

A video that uses children to act out some of Mexico’s most serious social problems -- corruption, express kidnapping, poverty, migration, and drug violence -- is reportedly backed by one of the country’s richest men.

The four-minute video, “ Discomforting Children,” tracks a child bureaucrat as he goes about his day. He smokes a cigarette and scans the day’s headlines about rising violence. He steps outside his apartment and is promptly mugged by two other youths, who are later seen handing over the stolen goods to a smirking cop. As the video continues, we see the main character give a briefcase full of money to another child in a suit, implied to be a powerful public official. The video touches upon some of other Mexico’s social ills, at one point showing a violent protest on the street, and a truck full of migrants in the countryside. It ends with a kidnapping, a gun battle (although no blood or deaths are shown),and the arrest of a drug trafficker, whom the Associated Press describes as “a kiddie-version of alleged drug lord Edgar Valdez, aka ‘La Barbie.’”

As a monologue at the end of the video makes clear, it is directed at Mexico’s presidential candidates. All have already responded: Institutional Revolutionary Party (PRI) candidate Enrique Peña Nieto tweeted “I support the message of ‘Discomforting Kids,’” while National Action Party (PAN) candidate Josefina Vazquez Mota called the video, “a call that can’t be ignored.” Leftist candidate Andres Manuel Lopez Obrador said it was “well done, it’s tough but it’s the truth.” Such positions are unsurprising: as the AP’s analysis points out, none of the candidates could afford to criticize the video, for risk of appearing dismissive of the very real social problems that it depicts.

After being uploaded on April 9, the video had 2.5 million views on Youtube as of April 13. The video was released by Our Mexico of the Future (Nuestro Mexico del Futuro), a group that describes itself as a “social movement without precedent across the nation.” A list of the group’s sponsors appears at the bottom of the web page.

According Mexico media, including columnists from major newspapers like Milenio and Cronica, as well as investigative magazine Proceso, one of the group’s main backers is Alberto Bailleres, Mexico’s fourth-wealthiest man. Bailleres owns the concession to the world’s largest silver mine, Proceso reports. He was the previous owner of Mexico’s largest beverage company, which was sold to Heineken without the proper payment of hundreds of millions of dollars in taxes.

That such a major business interest is reportedly linked to the video’s production may raise fears that Mexico’s powerful, conservative business sector will release videos during the 2012 campaign season, with the purpose of influencing election results. During the 2006 election, in which Lopez Obrador narrowly lost to Felipe Calderon, private business groups backed several videos depicting a Mexico in chaos. The implied message was that this was Mexico’s future, should Lopez Obrador win the presidency. Lopez Obrador supporters later argued that these “fear-mongering” videos scared voters into voting for Calderon.

The monologue given by a young girl near the end of the “Discomforting Children” video addresses all four presidential candidates. Nevertheless, it is interesting that the video depicts massive street protests as a social ill that Mexico must confront, alongside the corruption and drug violence presented in the mini-film. One banner held by the child protesters reads “No to Evaluation” (at 1.46), a slogan associated with Mexico’s teachers union, which has held several strikes against an evaluation system they say is unfair.

On the surface, this may be among the most innocuous scenes in the video, but perhaps it is among the most significant. Is the implied message that the workers’ unions who cause dissent are an undesirable future for Mexico, on par with continued drug-related violence? The video has already been criticized in Mexico for its usage of child actors. That may be the least problematic thing about it.

News Briefs

• Obama heads to Latin America today for the Summit of the Americas. Analysis from the New York Times gives a broad summary of the big questions awaiting regional leaders at the meeting, the proverbial “gorilla in the room” being the issue of drug policy reform. For another good list of expert commentary and international media coverage of the Summit, the Transnational Insitute and WOLA have a joint compilation. The Washington Post has another take on the Summit, focusing on how the meeting in Cartagena represents Colombia’s new standing as a “bright spot” on the continent, with its growing economy and booming security. Alma Guillermoprieto has a post worth reading on the New York Times Review of Books blog, writing, “It’s not even certain that Latin American leaders will achieve anything other than a mealy-mouthed agreement to discuss the possibility of a discussion. But it will be a start.”

• Another controversial video is causing trouble to Mexico, after ruling party the PAN released a campaign ad calling rival candidate Enrique Peña Nieto “a liar,” reports the AP. The video possibly violates Mexico’s law against negative political campaigning, and Peña Nieto’s party, the PRI, says they plan to file a complaint with the national electoral commission. Meanwhile, leftist candidate Andres Manuel Lopez Obrador is trying to sell his appeal to the private business interests who strongly opposed his 2006 presidential campaign, reports the LA Times. The newspaper has another broad look at the political campaign season in Mexico, noting that so far, none of the candidates are inspiring much passionate support. This will probably result in low turnout come July 1, the LA Times argues.

• Peruvian rebel group the Shining Path reportedly fired upon a helicopter conducting a search for the 40 gas workers kidnapped Monday, reports the AP. One police officer died during the attack.

• A vaccination campaign against cholera has kicked off in Haiti, reports the New York Times. It is the end of a long debate among world health authorities, some of whom argued against the usage of the vaccine during the island’s 2010-2011 cholera epidemic, citing cost and logistical concerns.

• Former Assistant Secretary of State for Western Hemispheric Affairs Roger Noriega writes in Foreign Policy that should President Hugo Chavez die, Venezuela will turn into a “narco-state.” Noriega cites unnamed sources who told him that some of Chavez’s key supporters, including former military officer Diosdado Cabello who was recently named leader of the ruling party, “are far more likely to resort to unconstitutional measures and repression if they can count on support from Moscow and Beijing.”

• Argentina may nationalize its largest oil company, which currently has many of its shares controlled by a Spanish energy firm. The move could put raise significant tensions between the two countries, notes the New York Times. More from the Wall Street Journal.

• Plaza Publica reports that Guatemala President Otto Perez, who is urging that regional leaders discuss the transformation of drug policy during the Summit of the Americas, did not previously discuss his proposal with his political team.

• The Economist reports on the continuation of student-led protests in Santiago, Chile, stating that “Political leaders are wondering if they are seeing a popular rebellion against “the model”, as some call the free-market policies bequeathed by Pinochet and left largely intact by his successors.”

Hemispheric Debates on Drug Legalization Ahead of Cartagena Summit

Since Guatemalan President Otto Perez declared earlier this year that he planned to raise the issue of drug legalization at the Sixth Summit of the Americas, to be held in Cartagena, Colombia, this weekend, there has been debate over the issue in countries across the hemisphere.


InSight Crime has a special on drug legalization, which it says will be the “gorilla in the room” at the forthcoming summit -- though it is not officially on the agenda, the topic is on everyone’s minds. It provides a map of the positions of countries across the hemisphere on drug policy, with both their laws on drug possession and their views on Perez’s calls for dialogue. It also looks at academics’ views on the drug prohibition, andwhere Perez really stands on the question. Guatemalan Minister Fernando Carrera explained to the site that Perez’s motivation for raising this issue as soon as he took the presidency this year was simple: he did not want to be forced to take an ever-tougher stance on drugs, and so had to march straight in with the idea of legalization, even if the response was mixed.

The US has rejected the idea, although perhaps not as forcefully as might have been expected. A White House official told Foreign Policy blog this week that while the US considered the debate to be legitimate, “because it helps demystify [decriminalization] as an option,” the US was not going change its position. At the summit, President Barack Obama will be willing to discuss reducing crime and violence, but not a wholesale reform of drug laws, the official said.


An opinion piece in the Washington Post makes the case against legalizing drugs in the US, noting that it could drive consumption:

If cocaine were legalized, a $2,000 kilogram could be FedExed from Colombia for less than $50 and sold profitably here for a small markup from its price in Colombia, and a $5 rock of crack might cost 25 cents.

The price of that kilo is currently around $20,000 -- following the WP’s argument, this could mean the street price of cocaine in the US could drop to around a tenth of its current level, to around $10 a gram.


The piece does note the costs of prohibition, however, saying that imprisoning large numbers of low-level dealers is creating an “army” of people whose “blighted employment prospects” mean their only option is dealing drugs, citing a sharp drop in the hourly income of Washington DC street dealers in the last few years.


As the summit gets closer, influential voices across the region have spoken out in favor of drug reform. Fernando Henrique Cardoso, Cesar Gaviria y Ernesto Zedillo, ex-presidents of Brazil, Colombia and México, respectively, released a joint statementbacking Perez’s advocation of “regulation, not legalization” of drugs. They praise the courage of the Guatemalan president as well as Colombia’s Juan Manuel Santos and Costa Rica’s Laura Chinchilla, and said that in the past four months, the discussion has advanced more than 40 years, as El Pais reports. In Chile, Senator Ricardo Lagos Weber and Eduardo Vargas, director of NGO Asuntos del Sur, wrote a letter to President Sebastian Piñera asking him to support drug reform at the summit.




News Briefs

• Also ahead of the Summit of the Americas, the Associated Press looks at how the host president, Colombia’s Juan Manuel Santos, has emerged as a regional leader. It notes his defusing of tension over whether Cuba should be invited, with a visit to Raul Castro to discuss the matter, which enhanced his reputation as a “deft diplomat and budding powerbroker who gets along with just about everybody.” Despite being a center-right politician, and former close ally of ex-President Alvaro Uribe, Santos has mended relations with more left-leaning neighbors such as Venezuela’s Hugo Chavez and Ecuador’s Rafael Correa. The AP comments that Santos’ statement that he would like to help persuade the US not to block Cuba from attending future Summits of the Americas suggests he could be trying to broker an end to the US embargo on the island. This could help him in his talks with leftist rebels within Colombia, it says. The article notes the Colombia is now safe enough for Obama to pass three days there -- none of his three predecessors as president spent a night in the country. 

• The Miami Herald’s Andres Oppenheimer offers an alternative perspective on the Colombian president’s argument that Cuba should be included in future summits despite the rule that only democracies can attend. He says Santos’ argument that Washington and Latin American countries should redefine their concepts of democracy, elections, and freedom of the press is troubling for civil rights advocates. Oppenheimer argues that if Cuba is included, it could set a “dangerous precedent for the collective acceptance of dictatorships throughout the region.”

• In more news from Colombia, the Guardian has a report on Medellin, where it says a new war between drug gangs could be about to blow apart the city’s apparent peace. The Urabeños, who developed out of the AUC paramilitary group, are threatening to fight the local mafia, known as the Oficina de Envigado, for power in the city. The “looming battle between the Office and the Urabeños is for control of Medellin's underworld, the vast local market and for positioning to be able to negotiate with the Mexican mafias that ship cocaine to the US.”Colombia Reports has a critical take on the report, quoting analysts and local politicians who say that the city’s murder rate was almost 50 percent lower in the first three months of 2012 than last year, and that “There are no indications of an imminent war between the two groups.”
  Meanwhile another piece in the Guardian this week illustrates the divide in perceptions of the city, talking about Medellin’s “incredible transformation,” helped along by innovative architectural projects. Former Mayor Sergio Fajardo “was obsessed with the idea of public space, especially in poor neighbourhoods -- he attributed the fall in crime during his term in part to the increase in the amount of public space per citizen.”

• In Peru, the story of nine miners who were trapped underground for almost a week has ended happily, with their rescue. The men were stuck some 200 meters underground after a rockfall at an illicit copper mine last Thursday, and were supplied with food and oxygen through a tube. President Ollanta Humala said the accident underscored the danger of illegal mining, reports LA Times blog. His government is trying to push through reforms to license these kinds of illicit mining ventures and bring them within the legal sector. Further east, in Peru’s remote VRAE region, the search continues for 40 gas workers who were kidnapped Monday by the Shining Path rebel group, reports the AP. The kidnapping show the confidence of the group, with rebels spending some three hours in the town where they abducted the workers, “buying groceries and summoning about 20 residents to an assembly where they condemned the government and the natural gas industry.” The Shining Path have made some unrealistic-seeming ransom demands, as noted in yesterday’s post, including supplies of dynamite and a payment of $10 million.

• In El Salvador, there were reports that Carlos Dada, editor of website El Faro, had fled the country amid threats from “mara” gangs, quickly denied by Dada. Reporters Without Borders says that the organization has been receiving threats from gangs following their report in March that the government had made a deal with gang leaders to cut violence, in exchange for giving the leaders better prison conditions. Dada said that El Faro staff had not been offered protection by the government. He told Contrapunto that he was leaving the country, but only to attend a journalism conference in Panama.

• Central American Politics blog questions reports, which emerged over the weekend, that the Mexican Zetas drug gang have formed an alliance with the Mara Salvatrucha (MS-13) in Guatemala. The original AP article quoted an Interior Ministry official called Velasco. But on Tuesday “Interior Minister Mauricio Lopez Bonilla said that Velasco does not work for the Interior Ministry. It's not clear from the article that he knows who he is.” The minister also pointed out that the gang does not have a unified leadership structure, and is involved only in drug distribution and not in large-scale trafficking.

• The New York Times reports on the rise of women to leading positions in Brazil’s oil industry, which it says is a top priority for President Dilma Rousseff.

• Guatemala’s Otto Perez has said he will push through some 350 adoptions by US citizens that were underway before a freeze on foreign adoptions was imposed in 2007 amid reports of abductions and trafficking of children, reports the AP.

• President Hugo Chavez said he was doing well after his latest round of radiotherapy, on his return from Cuba to Venezeula on Wednesday

• The Wall Street Journal reports on Argentine President Cristina Kirchner’s battles with the country’s biggest oil company YPF.

• Mexico’s Pacific coast was hit by a 6.9 magnitude earthquake of the Baja peninsula, hours after a separate 6.4 quake hit west Mexico, felt in Mexico City. No injuries or major damage were reported.

• The Washington Post reports on Mexico City’s scheme to close major roads in the city center to cars on Sunday mornings, to let cyclists and joggers take over, put in place five years ago by Mayor Marcelo Ebrard. Similar programs have been implemented in Bogota and in Medellin, Colombia.

Guerrilla Kidnappings Put Humala in a Tight Spot

As noted in yesterday’s Post, Peru’s Shining Path guerrilla group kidnapped dozens of natural gas workers in the southern region of Cusco on Sunday. There appear to be conflicting reports about the number of people being held by the rebels. While some sources claim that 23 of the workers had been released early Monday, local officials maintain that none of the victims have been freed thus far. Meanwhile, El Comercio reports that the guerrilla group released only three individuals, and is holding on to 36 hostages in total.

The kidnapping took place in the Apurímac Ene River Valley (known in Spanish as the VRAE), which is known as a rebel outpost. After the February capture of alias "Comrade Artemio," who led a guerrilla bloc in the Upper Huallaga Valley to the north, the VRAE Shining Path are believed to be the last remaining armed front of the Maoist group.

The guerrillas have reportedly released a rather unrealistic list of demands for the hostages. According to El Correo, it includes a $10 million ransom fee, radio equipment to keep in touch with authorities, explosives and detonation devices, as well as an annual “quota” of $1.2 million. The administration of President Ollanta Humala has so far not responded to the ransom, although it has declared a 60-day state of emergency in the area.

The Shining Path is no longer a major threat to the stability of Peru, and their near-absurd demands seem to reflect more desperation than any kind of real bargaining power. Still, this incident could create a credibility gap for Humala, who has sought to portray the group as practically defunct.  Combined with the fact that he has taken a firm stance against negotiating with the group in the past, this suggests that the president will likely pursue the VRAE Shining Path determinedly in the coming weeks.  

However, this would have its own set of political pitfalls for Humala. As a Reuters piece published this morning points out, human rights groups in the country have filed a formal complaint with the Inter-American Commission on Human Rights alleging that the president ordered the forced disappearance of two civilians during his time as an officer fighting in the country’s  brutal civil war. While Peruvian officials are confident that the commission will turn down the case, Humala could be reticent to wage an aggressive counterinsurgency campaign for fear of drawing attention to his military past.

News Briefs

·         After an article in Time magazine quoted him as saying “I love Fidel Castro,” Miami Marlins manager Ozzie Guillen found himself facing the wrath of Miami’s Cuban exile community. Although he swiftly apologized for his remarks, the baseball team has suspended Guillen for five games. Foreign Policy’s Joshua Keating argues that Guillen’s observations about Castro’s impressive ability to stay in power (and live) for so long are actually spot-on, and notes that the manager has made plenty of controversial comments in the past. Colombia’s El Espectador has another interesting take on the incident, pointing out the contradiction between the calls for Guillen to resign and the fact that the US is the hemisphere’s most outspoken advocate for freedom of speech.

·         La Razon and Reuters report that Bolivian President Evo Morales has announced that he is terminating a contract with Brazilian company OAS to build two sections of a controversial highway through the Amazon rainforest. The proposed connecting section between the two, which was to pass through the Isiboro-Secure reserve (TIPNIS) - was suspended last year after a series of massive protests.

·         After hours of deliberation, the Haitian Senate has approved President Michel Martelly's nominee for Prime Minister, current Foreign Affairs Minister Laurent Lamothe. The AP notes that Lamothe will still have to gain approval in the Chamber of Deputies before he can take office.

·         With only seven months left in office, Mexican President Felipe Calderon is making his first official visit to Cuba today. Reuters claims that Calderon’s visit is aimed at “patching up” relations between the two countries, which were considerably warmer during the Institutional Revolutionary Party’s 71 years in power. When the center-right National Action Party won the 2000 elections, however, this began to change. The Global Post questions whether Calderon will raise human rights concerns during his visit, which would likely not go over well.

·         Eight taxi cab drivers were gunned down within minutes of each other yesterday in the northern Mexico city of Guatalupe. Milenio notes that the men were all unlicensed drivers, and suggests that they may have been working as lookouts for drug gangs in the area.

·         A new Gallup poll has found that support for the military in Mexico (widely seen as the “least corruptible” component of the country’s security forces) has declined since over the past four years, from 64 percent in 2007 to 58 percent in 2011.  The poll also showed that more Mexicans reported feeling less safe walking alone at night in 2011 than they did in 2007.

·         Colombian Foreign Minister María Angela Holguín told Reuters that Venezuela’s Hugo Chavez is slated to attend the upcoming Summit of the Americas. The news agency suggests his attendance could serve to convince Venezuelans of his recovery, as well as give him a “chance to challenge President Obama openly before dozens of regional leaders.”

·         The Washington Post takes a look at the growing support for alternative drug policies in Latin America, noting that the governments of Colombia, Guatemala and Mexico are all likely to challenge the United States’ war on drugs at the Summit this weekend.

·         Spanish newspaper El Pais published a piece on violence in Medellin over the weekend, claiming that the city is home to some 5,000 sicarios belonging to around 300 different gangs. The article also cited gang sources who claimed that “hits” could be ordered for as little as 5,000 pesos (about $2.75). In response, both the national and Medellin governments have called the piece unrealistic, emphasizing that violence has declined tremendously in the city. Editor-in-chief of the Medellin-based Colombia Reports, Adriaan Alselma, attacks El Colombiano (also headquartered in the city) for publishing government criticism of the El Pais article in rather colorful language, referring to the newspaper as the “local rag.”

·         La Silla Vacia checks up on the status of Colombia’s historic Victims’ Law three months into its implementation. As the news site points out, the law may not be living up to its initial hype.  

·         RNS at Honduras Culture and Politics offers a tidy assessment of Honduras’ efforts to clean up its notoriously corrupt police force. The committee charged with the task has only been partially named, and only 18 police officers have had their file turned over to the public prosecutor’s office. 

Brazil and US Keep Distance During White House Visit

Brazilian President Dilma Rousseff’s first visit to the White House was warm enough on the surface, but could not disguise the tensions between the two countries. Rousseff had lunch with President Barack Obama in the White House, then the two met privately for two hours. The working lunch was much more low-scale than the state dinners given to India and China, even though these rising global powers, like Brazil, also differ sharply from the US position on some foreign policy and economic issues, reports BBC Brazil. The choice to grant Brazil’s president a lunch instead of a black-tie state dinner could be interpreted as a “snub of protocol,” which some Brazilian officials have said “represents Washington's failure to fully recognize their country's recent economic rise and growing clout in global affairs,” as Reuters reported last week.

The New York Times notes that two presidents also behaved coolly during a post-lunch press conference, during which “the leaders’ eyes rarely met, and Ms. Rousseff rarely looked at Mr. Obama as he spoke.” The Times also reports that Obama “seemed to bristle” when Rousseff described concerns over US “expansionist monetary policies.” The AFP leads on Rousseff’s critique of this “currency war:” in which Brazil argues that the real has lost value because Brazil has been flooded “with cheap dollars generated by easy credit.” Reuters describes Rousseff’s comments as the clearest note of discord during the press conference, as the remarks exposed the differences between Brazil and the US on trade policy.

Still, disagreements over the exact nature of this “currency war” is only one of the several underlying tensions in the Brazil-US relationship. Rousseff later told BBC Brazil that none of the most sensitive issues on the Brazil-US agenda -- Brazil’s campaign for a permanent seat on the UN Security Council, Iran’s nuclear program, trade with Cuba -- were discussed during her conversation with Obama.

Instead, the meeting emphasized small but important steps to greater integration between the two countries. Secretary of State Hilary Clinton announced the opening of two new US consulates in Brazilian cities Belo Horizonte and Porto Alegre. The presidents also reportedly discussed easing visa restrictions, to make travel between the two countries easier. The other most concrete agreements to emerge from the talks involved new terms on alcohol imports, as well as more cooperation on aviation and technology sharing.

One Brazilian official told Reuters that overall, the meeting went better than expected. Obama and Rousseff experienced a “click” together, the official added.

But as an Op-Ed in the LA Times points out, there is still a “respect deficit” between the two countries:

“Frequently, the U.S. treats Brazil as an interloper in world affairs, which does not match the status it has achieved. For its part, Brazil seems intent on demonstrating its influence by flaunting its independence of the U.S. and, on many issues, showing off its opposition, even when bedrock U.S. interests are at stake.”

The LA Times argues that the US has much to gain by treating Brazil as a partner on the same level as India, a nation which has enjoyed strong relations with the Obama administration (and has also been the recipient of a black-tie state dinner). Brazil could be a key partner for the US in confronting policy questions related to Middle East affairs and nuclear technology, unlike India, which has a more problematic profile, the Op-Ed argues.

But India might not be the most apt comparison for Brazil’s sometimes contentious relationship with the US. As one unnamed US official told the Financial Times, Brazil is something like the “France in Latin America,” in which “obstructionism in global talks is often driven by their need to assert their newfound power ... Undermining our initiatives in Iran or over trade talks, for example, is their way of forcing us to pay attention to them.”


News Briefs

• Guerrilla group the Shining Path kidnapped 30 employees of a contractor working for a Swedish construction company, reports EFE. 23 of the workers were released early Monday, and the remaining seven later in the day. The kidnapping took place in a rural part of the VRAE valley, where the Shining Path faction is believed to be more deeply involved in drug trafficking and more militarily powerful than the rival faction based some 250 kilometers north in the Upper Huallaga Valley. Police told EFE that the nearest police station was about eight hours away from where the kidnapping took place, and that the guerrillas escaped in the contract company SUVs. The BBC says that the rebels reportedly demanded the release of “Comrade Artemio,” the leader of the Shining Path faction who was arrested in February. This would be unusual as the leader of the VRAE rebels, known as Victor Quispe Palomino, alias "Comrade Jose," reportedly was on bad terms with Artemio, who described the VRAE guerrilla faction as “mercenaries” and criticized their lack of political ideology. The kidnapping is strikingly similar to one carried out by the FARC in February 2011, in which they kidnapped 23 oilworkers contracted by Canadian company Talisman, only to release 21 of them the following day. Like the FARC, the Shining Path seems to have decided to target the energy sector (the contractors were working on a gas pipeline project). By making themselves appear a threat to multinationals interested in working in Peru, the guerrillas have possibly picked a far more effective way of scaring the government, rather than carrying out small-scale hit-and-run attacks. But the fact that the Shining Path released the hostages so quickly also indicates that they do not have the logistical resources needed to take care of even one hostage in the jungle. It may be another sign that, like the FARC, the Shining Path must now operate as a small, mobile group, and keeping a large group of hostages would prove a serious burden and could attract unwanted attention from the security forces.

• Reuters reports that the National Action Party (PAN) will revise the campaign strategy of its presidential candidate, Josefina Vazquez Mota. In a press conference, Vazquez Mota said that she was “changing course” and would be working with a new campaign team. A poll published Monday showed that Vazquez Mota is trailing Institutional Revolutionary Party (PRI) candidate Enrique Peña Nieto by 18 points. Sin Embargo reports that Vazquez Mota’s original campaign team was responsible for dozens of basic errors, including botching the formal announcement of her nomination on March 11, in which she gave a speech to a near empty stadium. The original campaign team also confused the names of towns and states in her official schedule, giving the impression that Vazquez Mota is not in touch with rural Mexico. The team also made basic spelling, grammar, and fact-checking errors in the campaign press releases, like calling Mario Vargas Llosa a Nobel Peace Prize winner. Vazquez Mota is the first woman to run for president in Mexico, but her historic run disguises another ongoing struggle for gender equality in Mexico politics. Under current electoral law, 40 percent of Mexico’s political party and coalition candidates must be female, but it seems unlikely that the political groups will meet the quota this year, says Justice in Mexico.

• The trade attache at the Costa Rica embassy in Venezuela was briefly kidnapped Sunday night, reports the BBC. The kidnappers reportedly requested a ransom, but it is unclear whether they secured this when they released the hostage on Monday. One police official told Globovision that they found the diplomat in an “inadequate place,” in a confused state after receiving a blow to the head. Costa Rica is only the latest foreign official to be targeted for kidnapping in Venezuela: the Mexican ambassador and his wife were briefly kidnapped in January, and the Chilean consul held in November. Baseball player Wilson Ramos was also kidnapped last year. This string of cases against wealthy and powerful foreigners may be one indication that kidnapping gangs are growing more sophisticated and better able to identify and target such high-profile targets.

• Foreign Policy wonders if there is another explanation for President Hugo Chavez’s reported battle with cancer, with a headline that asks, “Is Hugo Chavez really sick?” The post asks whether Chavez is turning his illness into “theater,” after a well-publicized visit to a Church last week in which he wept and asked for his life to be spared. As Caracas Chronicles argues, the question of whether Chavez was “hamming” it up for political purposes may be besides the point. His Church visit represents a marked “change in tone” from his initial attitude when he first announced his illness, and may suggest that his disease is in fact getting worse.

• The trial of drug kingpin Walid Makled began in Venezuela yesterday, reports the AP. The trial is closed to the news media, raising questions of how transparent the process will be. Makled was captured in Colombia in 2011, and President Juan Manuel Santos chose to extradite him to Venezuela rather than the US, where he is also wanted on drug trafficking charges. Makled has spoken openly of his corrupt ties to the Venezuelan army and the state oil company, and it is possible that Venezuela badly wanted to have him tried in a Venezuelan rather than a US court, where he could reveal uncomfortable information.

• In other Venezuela news, blog the Devil’s Excrement with an interesting yet brief on-the-ground look at the growth of gated communities in Venezuela’s poorer barrios: “Poor barrios in Venezuela are now using the same techniques that fancy residential areas have used for about two decades: Neighbors are getting together, fencing around their houses and putting in a common gate to block the hoodlums from breaking into their homes or mugging them.

• The AP with a striking photo essay, accompanied by a brief, on San Pedro de Sula, Honduras, the world’s most violent city. The city’s murder rate is currently double the national average of 86 homicides per 100,000 inhabitants per year, the AP reports.

• A new vertical garden in Mexico City is representative of the rise of civic life in the city, and evidence that the local government’s emphasis on more environmental-friendly policies is paying off, reports the New York Times.

• A gun battle broke out between the ruling party and the opposition part in the Dominican Republic, ahead of next month’s presidential election, reports the Latin American Herald Tribune.

• The CS Monitor on a new immigration trend: the return of Mexican migrants to their small town origins in Mexico.

• The Latin American Herald Tribune reports on a bomb that detonated outside a Chilean bank branch early Monday morning.

• The New York Times with a colorful feature on the decline of Juarez’s soccer team, the Indios, who captured the imagination of many sports fan after they won a spot in Mexico’s major leagues in 2008. Many sports writers originally presented the win as the story of underdogs who provided hope to Juarez, just as the city’s homicide rates began to rise to record levels. But as security in Juarez worsened, so did the performance of the Indios, who were eventually dismissed from the major leagues, sold to another owner, and finally disbanded.

Rumors Over Chavez's Cancer Raise Spectre of Succession

With more conflicting reports on the health of Venezuela’s President Hugo Chavez, and the president himself seeming to suggest that his condition is more severe than he has previously admitted, questions about who will succeed him are becoming more pressing.

Chavez arrived in Havana yesterday for another round of radiation therapy, following his public pleas last week to Christ not to "take me yet.”

On Friday there were reports in Brazilian media that Chavez was going to a Sao Paulo hospital for emergency treatment. When contacted, doctors at the facility said they had not been informed of this, according to the WSJ. Nelson Bocaranda, a Venezuelan columnist who has made a speciality of disseminating information and rumors on the president’s health, had also reported the story independently. Bocaranda later said that Chavez had changed his mind about the plan at the last minute, because he was concerned that going to Brazil instead of Cuba would embarrass Fidel Castro. Bocaranda also claims that Chavez had a secret meeting with the Pope while the two men were both in Cuba in March, according to a WSJ piece on the journalist.

Inter-American Dialogue’s Michael Shifter told the WSJ that, as the newspaper phrases it;

the apparent worsening of Mr. Chavez's illness could push political actors in Venezuela, especially the armed forces, to step up efforts to manage a difficult transition [as] the president's health deteriorates.

While uncertainty over Chavez’s state of health raises tensions in Venezuela, Defense Minister Henry Rangel Silva gave an ambiguous reassurance about the army’s stance on the upcoming presidential elections, reports the WSJ. "We are going to recognize whoever wins the October 7 elections. We're not just going to recognize whoever says they won," he declared. This follows the close Chavez ally’s statement in 2010, while commander of the armed forces, that the institution would not accept a change in government and was wedded to the Chavez project.

Meanwhile, Mary Anastasia O’Grady at the WSJ says that if the president dies without picking a successor it could provoke a free-for-all in Venezuela, with a struggle between armed civilian factions and the military. She also warns that Chavez’s ideology might be cemented rather than weakened, as “his early demise could make chavismo a near religion in Venezuela.”

Colombia’s La Silla Vacia also has a piece on Bocaranda, saying that he is considered the best-informed person in Venezuela, with information that no other journalist has access to. The website notes Bocaranda’s reports on the Colombian government’s alleged moves to make peace with the FARC rebels. It says he reported last month that FARC leaders “Alfonso Cano” (now dead) and “Timochenko” had flown from Venezuela to Cuba last year for talks with Fidel Castro, while Colombian President Juan Manuel Santos’ trip to the island this year was made to ask Chavez and the Castro brothers for help with negotiations. Bogota denies such negotiations are taking place.


News Briefs

• Ahead of this weekend’s Summit of the Americas in Cartagena, Guatemala’s President Otto Perez has made his most explicit comments yet on the drug legalization issue, via a comment piece for the Guardian. He argues that, despite all the blows struck against drug traffickers over the years, the trade continues undaunted, and that it cannot be eradicated but should be regulated, like the markets in cigarettes and alcohol. Perez says that drug consumption should be considered a public health issue, not a criminal justice problem.
  
  "Our proposal, as the Guatemalan government, is to abandon any ideological position (whether prohibition or liberalisation) and to foster a global intergovernmental dialogue based on a realistic approach – drug regulation. Drug consumption, production and trafficking should be subject to global regulations, which means that consumption and production should be legalised but within certain limits and conditions."
  
  Perez has said that he plans to raise the legalization issue at the upcoming summit, and notes in his Guardian piece that Colombia’s Santos and Costa Rica’s Laura Chinchilla have said that are open to dialogue -- “Those of us who have experience on security matters know what we are talking about.”
  The Miami Herald argues in an editorial that Obama can’t afford to ignore the arguments for legalization and that he should use the summit to show his engagement with Latin America; “The United States must send a message to its allies in the region that they are not alone in fighting the drug scourge.”

• Obama is set to meet with Brazil’s Dilma Rousseff today in Washington, amid what the WSJ says is optimism over the prospects of closer ties between the two countries. Trade will be high on the agenda, while Rousseff may press her US counterpart to attend a UN environmental meeting in Rio this year, and is expected to criticize US monetary policy. The two are also likely to discuss proposed UN sanctions on Syria, and moves to liberalize their visa policies,reports the Miami Herald. An editorial in the same paper argues that Obama should make visa reform a "personal priority," and that the two should move ahead with a bilateral tax treaty to prevent investors being taxed twice -- Brazil is the only country with a GDP over $1 trillion with which the US does not have such a treaty.

• The NYT looks at China’s increasing influence in the Caribbean, via “loans from state banks, investments by companies and outright gifts from the government.” The fact that the Asian superpower is gaining influence in an area traditionally dominated by the US is causing some concern in Washington, though the ties do not involve building military bases or establishing security ties. Unlike in Africa and South America, China’s projects in the Caribbean are driven more by long-term economic ventures like tourism than by sourcing commodities, says the NYT.
  With a slideshow of photographs of Chinese workers and China-backed projects in the region.

• The Miami Herald reports on Cuba’s efforts to shift 1 million people from state jobs and into self-employment by 2014. It says the reforms are going slower than expected, with only 371,000 people currently holding self-employment licenses, while many of these were already working illegally and have just legalized their position. Many of these entrepreneurs buy illegally imported supplies from the black market at high prices, after they have been brought into the country purportedly as “gifts” for relatives.

• Jeremy McDermott at InSight Crime argues that Colombia’s conflict is entering a new phase, with groups born out of the AUC paramilitaries overcoming ideological divides to team up with drug trafficking rebel groups, including the FARC, against the government.

• El Tiempo asks what will come next for Colombian peace activist Piedad Cordoba, who has been involved in negotiating the release of FARC hostages, now that the rebel group has freed all political hostages. Cordoba, an ex-senator who was banned from public office over accusations that she had ties to the guerrillas, told the paper she will keep working to bring human rights standards to the conflict. Ex-President Ernesto Samper commented that she is the only person who would be able to build a bridge in less that two years with the FARC.

• The Associated Press reports that Mexico’s Zetas may have joined forces with the “mara” street gangs of Central America, based on comments from Guatemalan officials.

• In Peru, nine miners who have been trapped more than 200 meters underground since Thursday are receiving food and liquids through a tube, reports the BBC. Peru’s government has appealed for foreign equipment and experts to help free the men, reports the AP, which says that 52 miners died in mining accidents in the country last year.

• The LA Times reports on problems with Brazil’s transport infrastructure, which is preventing the economy from expanding faster. It says that Rousseff has attempted to address the issue, privatizing three key airports, raising questions about whether the same action will be taken with other transport assets, like roads or ports, in the rush to get the country ready for the Olympics and soccer World Cup.

• Simon Romero at the NYT has a piece on a newly-opened astronomy station in Chile’s Atacama Desert, with funding from the US and Europe, which he says is strengthening the country’s position at “the vanguard of astronomy.”