Political Developments - September 2018

Mexico elected Andres Manuel Lopez Obrador - popularly known by his initials AMLO - on 1st July for a six-year term by a wide margin over his conservative rivals: 53 percent to AMLO, 22.5 percent to Ricardo Anaya from the National Action Party (PAN), and 16.4 percent to Jose Antonio Meade from the Institutional Revolutionary Party (PRI). Sixty four-year old AMLO heads a three-party coalition led by the leftist National Regeneration Movement (Morena) which he founded in 2014. His movement has also captured important governorships and a majority in both houses of Congress, the first time this century (and since the end of the 7-decade PRI monopoly on power) a Mexican president enjoys this privilege. At least 60 percent voted, of an electorate of 89 million, for 18,000 elected posts, in an election marred by violence and the assassination of around 150 politicians.

AMLO brings experience of Mexican governance from his days as Mayor of Mexico City and a lot of bitterness from past defeats at the hands of the ‘mafia of power’. He espouses a change, a fight against corruption, economic independence, social justice, more control of hydrocarbon resources, and a more independent foreign policy. A leftist in charge of Mexico for the first time in decades runs counter to the election this year of conservative presidents in Chile, Colombia, Paraguay and earlier in Peru and Argentina. Mexico today is, however, a very open economy, a member of the OECD, APEC, G20, robustly integrated into global supply chains. Its foreign trade is greater than India, though most of it is with the United States. AMLO tried to assuage the markets in his victory speech: "… We will not act arbitrarily nor will there be confiscation or expropriation of property." Despite conciliatory comments from AMLO and President Trump, the US-Mexico relationship, battered by US threats to build a wall which Mexico will pay for, and expel Mexican immigrants, will be watched closely. The signs were good by end August, with the US and Mexico announcing a bilateral deal on trade, based on give and take on automobiles and certain other sticking points.

The situation in Nicaragua continued to worsen as the death toll by July crossed 300. Violent protests broke out on 18 April when President Daniel Ortega announced reforms to the pension system. Ortega, who led the revolt against right-wing dictator Anastasio Somoza in 1979, formed the Sandinista movement and led it to electoral victory. He faced resistance from his own supporters but co-opted the private sector and the armed forces, and eventually got a pliant judiciary to sanction his re-election in 2016. He won with 70 percent of the vote. The protests, initially led by students but later backed by diverse sections of Nicaraguans, were suppressed violently by the government which miscalculated the depth of popular resentment at first. Ortega, who rules along with his wife and Vice President, Rosario Murillo, gave in and suspended the pension measures but the movement against him has snowballed and most analysts feel he cannot last till the next election in 2021. Nicaragua’s Catholic bishops, who were asked by Ortega to mediate, recommended early elections in March 2019. The OAS has also been involved to strengthen democratic institutions in the country and passed a resolution - 21 of 34 votes in favour - on 18 July calling for early elections. The permanent council of the OAS rejected by 20-3 a Nicaraguan draft denouncing “coup-mongering opposition groups”. Though a left-wing regime and a member of the leftist regional ALBA bloc, Ortega’s government has spurred growth in Nicaragua, though there are allegations of corruption and collusion with sections of the private sector. Nicaragua has sought strategic cooperation with Russia, works with China though it recognises Taiwan, and has close relations with Venezuela.

On 31st July, Cuba published the text of a new draft constitution - 224 articles approved by the legislature. This will go through a popular consultation process till November, after which it will be submitted to approval by referendum. The new constitution drops the word “communist”, and refers to the “socialist character of the political and social system” of the island with the Communist Party of Cuba as the “superior ruling force”. The draft proposes to recognize private property, reorganize the government by reviving the position of prime minister (abolished in 1976) and pave the way for possible recognition of same-sex marriage as well as other economic, social and political changes. It also offers formal recognition to freedom of expression and association, but within the limits of current laws that restrict those rights. It does not provide for direct elections for top government jobs. In the making for the past five years by a working group headed by former President Raúl Castro, the draft acknowledges the economic reforms over the past decade and advocates sustainable socialism with private property, recognizing the need to promote foreign investment on the island. Recently approved regulations, however impose high taxes and stringent restrictions on private enterprises, limiting their size, workforce and profits. Foreign investors still have concerns about whether their contracts and asset ownership will be protected, though the new constitution protects property, including foreign investment, from expropriation except for public purposes. It guarantees compensation, the right to choose their own workers and compete with the state sector. These constitutional changes will not weaken the dominance of Cuba’s military-run conglomerates in all the profitable sectors of the Cuban economy.

A politico-legal battle loomed in Argentina in mid-August with judicial orders for arrest of a dozen people, including prominent businessmen over suspicions of corruption involving the previous Kirschner government and construction companies, based on plea bargain testimonies by businessmen and former officials involved. Argentina’s daily La Nación earlier this year got copies of eight handwritten notebooks of a chauffeur of the Kirchner government. These detailed trips to pick up bags full of cash from companies awarded government contracts, including the apartment of late president Nestor Kirchner, and his wife and successor Cristina, between 2005 and 2015. The bribes are estimated to be worth US $ 200 million. A judge requested that former president Cristina Fernandez be stripped of her congressional immunity as senator and ordered a raid into her home. The scandal recalls the ‘Car Wash’ operation that brought down the previous government in Brazil and led to the arrest of former President Lula.

On 20 August China scored another diplomatic victory when El Salvador shifted recognition from ROC (Taiwan) to PRC. The shift was anticipated but came just two days after Taiwan’s president Tsai Ing-wen visited the region. A Chinese embassy in the capital San Salvador should be functional shortly, along with a Confucius Institute. This reduces the number of countries in LAC that retain diplomatic relations with Taiwan to 9 of a total 17 worldwide.



September 12, 2018

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About the Author

Ambassador Deepak Bhojwani

Former Ambassador of India to Colombia, Venezuela and Cuba and Distinguished Fellow, Ananta Centre

Ambassador Deepak Bhojwani joined the Indian Foreign Service (IFS) in 1978. He retired in February 2012. During his career, he was accredited as Ambassador in seven Latin American countries, resident in Colombia, Venezuela and Cuba, concurrent in Ecuador, Costa Rica, Cuba and the Dominican Republic, and was Consul General in Sao Paulo. He served abroad in three Continents – Asia (Indonesia and Malaysia), Europe (Spain and Czech Republic) and Latin America.

In the Ministry of External Affairs, he served in the Divisions dealing with Administration; West Asia and North Africa; US and Canada; and had a brief stint at the United Nations.

Ambassador Bhojwani also served as Private Secretary to the Prime Minister of India, Mr P.V.Narasimha Rao for two years from 1994 to 1996, and as Special Assistant to the Minister of State for External Affairs and for Science and Technology, Mr K.R.Narayanan, from 1985 till 1988.

He writes extensively on Latin America and its relations with India. He has written a book published in 2015 titled ‘Latin America, the Caribbean and India: Promise and Challenge’.

He is currently a Consultant for Latin America and the Caribbean through his firm LATINDIA (www.latindia.in)

Ambassador Bhojwani also serves as Independent Director on the Board of Bharat Petroleum Corporation Ltd., one of the largest state oil and gas companies of India.

Since January 2017 he has been Country Manager and Director, Magotteaux Industries Pvt. Ltd.

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