Political Developments
On 4 February El Salvador’s voters overwhelmingly endorsed President Nayib Bukele for a second term. He outclassed his opponents from the left-wing Farabundo Martí National Liberation Front (FMLN), and the right-wing Nationalist Republican Alliance, the two parties that shared power before Bukele’s New Ideas (Nuevas Ideas) party appeared. Bukele has become a consequential and controversial figure in Latin America since he came to power on a promise to bring security to the country’s crime-ridden streets, an achievement most Salvadorans credit him with – he got 83 percent of the votes. But critics claim this comes at a cost to democracy and human rights, with thousands of apparently innocent people being arrested and the judiciary and parliament hobbled. Bukele also finessed the country’s laws, which ban re-election, after the Constitutional Court declared he could stand for re-election if there was a gap between his first and second term. He stepped down nominally from the presidency a few weeks before the election. He also managed to retain the party’s parliamentary majority won two years ago, after which he had imposed on March 27, 2022 an emergency regime for his fight against gang violence, leading to the arrest of some 76,000 people. Under the state of emergency, police may detain any person without an arrest warrant for at least 15 days before bringing them to a court. The measure has been extended 22 times by a Bukele-run Congress for 30-day periods. In 2015, El Salvador was the most violent country in the world with 103 homicides per 100,000 inhabitants, but there has been considerable improvement in the situation. This achievement has enhanced Bulele’s reputation all over the region and made him a role model for many countries suffering from lawlessness. Another controversial measure taken by Bukele in 2022 was to make Bitcoin legal currency, which some critics say created another set of economic problems.
In early January violence exploded across Ecuador after a notorious drug cartel leader escaped prison, followed by others, and inmates took dozens of prison guards hostage. Gang members soon thereafter launched a series of seemingly coordinated attacks around the country, setting off car bombs, torching vehicles and buildings, and taking scores of prison guards hostage. On 9 January, heavily armed hoodlums stormed a popular TV station in Guayaquil and took its journalists hostage live on air. The Pacific port city with Ecuador’s most important container terminal, plays a central role in the smuggling of South American cocaine to the US and Europe, and has been consumed by gang warfare in recent years as rival groups have battled for control. An atmosphere of impunity seems to have emboldened gang leaders, who have shed their masks and now advertise their power on TikTok to potential recruits. In some areas gangs, with complicity of local authorities enforce “zones of silence” in which journalists are banned from covering local politics. Recently elected President Daniel Noboa declared a state of war and sent out over 22,000 soldiers to regain control. Most streets were deserted around the affected areas as people stayed away. The situation has also forced migration northward. U.S. Customs and Border Protection agency reported more than 100,000 encounters with Ecuadorians trying to get in in 2023.
Brazil convened the meeting of Foreign Ministers of the G20 in Rio de Janeiro in February, in a lead-up to the summit it will host in November. There was contention over the G20 Brazil website mention of “the situation in the Middle East and the Russian offensive in Ukraine” – situations it says have led to international concern “over the humanitarian crisis and the geopolitical and economic consequences of the conflicts.” The Chinese spokesperson (China was represented by their Deputy Foreign Minister at the meeting) said “The G20 is the premier forum for international economic cooperation, not a platform for resolving geopolitical and security issues…This is a G20 consensus”. Russian Foreign Minister Sergei Lavrov objected to Ukraine’s security being part of the agenda, saying in a statement that the issue was “non-core” for the G20. “The Russian delegation intends to draw the special attention of partners to the unacceptability of the politicization of the G20, which, according to its mandate, is designed to focus strictly on socio-economic challenges.” The meeting of G20 Economy Ministers in Brazil late February also failed to achieve a consensus document with western delegates insisting on mention of conflicts, especially Ukraine. The Brazilian presidency “noted that the finance track is not the most appropriate forum for resolving geopolitical issues and proposed that these issues continue to be discussed in relevant forums and meetings”.
Brazil’s President Lula during the meeting in February declared “I am in favour of the creation of a free and sovereign Palestinian state….What…Israel is doing is not a war, it is genocide because it is killing women and children.” Earlier on a visit to Africa on 18 February Lula had said “What’s happening in the Gaza Strip with the Palestinian people hasn’t happened at any other moment in history. Actually, it has happened: when Hitler decided to kill the Jews.” Immediately after, Israeli Foreign Minister Israel Katz on Monday (Feb 19) declared that President Lula is unwelcome in Israel until he retracts his remarks. He said “We will not forget nor forgive. It is a serious antisemitic attack. In my name and the name of the citizens of Israel – tell President Lula that he is persona non grata”. Israeli PM Netanyahu called the remarks “shameful and grave”, and said that his government had called in Brazil’s ambassador in protest. Brazil reciprocated and recalled its Ambassador in Tel Aviv, becoming the fourth Latin American nation to do so, after Colombia, Chile and Bolivia, the last having recalled all its diplomats from Israel. While the US expectedly disagreed with Lula’s comments, Brazil’s stand was backed publicly by the Presidents of Colombia and Bolivia.
Lula’s condemnation of Israel was echoed by President Gustavo Petro of Colombia. On 28 February, after an Israeli attack on a crowd waiting for humanitarian aid in Gaza, in which more than 100 people were killed, Petro claimed it “reminds us of the Holocaust.” Condemning Israeli “genocide” of Palestinians, he announced that Colombia “suspends all arms purchases from Israel”. Israel was one of the main suppliers of the Colombian Armed Forces, mainly of spare parts for Kfir fighter planes, acquired in the 1980s, and Galil rifles manufactured under Israeli license.
Economic Developments:
Argentina under President Javier Milei appears to be headed for a showdown with trade unions and leftist politicians who still have a majority in Congress. While he has had trouble passing tough “reform” measures – an Omnibus Law basically slashing subsidies and ending government support programs, actually leading to a financial surplus in January – there have been glimpses of international support. Milei met with IMF officials at the Davos Summit, after which the IMF board agreed to a US$ 4.7 billion disbursement. Private capital is also looking again at Argentina, with the Chairman of Blackrock, a powerful fund, visiting the country to meet Milei. Meanwhile as predicted, things have got worse. IMF estimated an average inflation of 230% and 150% at the end of the year, and a 2.8% drop in the economy, in its latest revision of the World Economic Outlook released in February. Milei has hinted he will resort to reform by decree if parliament stood in his way.
Focus India LAC:
India’s push for renewable and clean energy got a boost with the signing of an agreement on 15 January between Khanij Bidesh India Ltd. (KABIL) a consortium of three Indian public sector mining companies (NALCO, HCL and MECL), and Argentina’s government owned mining company Catamarca Minera y Energetica Sociedad del Estado (CAMYEN). The agreement, under which KABIL will invest about INR 200 crore to explore five lithium mines in the Argentinian province of Catamarca, comes after years of negotiations and investigations in the Latin American country which holds twenty percent of the known deposits of 98 million tons worldwide, according to the US Geological Survey. This will give KABIL exclusive rights to evaluate, prospect, explore and subsequently exploit commercially any deposits discovered. It will also give the Indian enterprise technical and operational expertise in brine type lithium exploration. Currently India spends about INR 6000 crore on lithium imports, mainly from China. KABIL has also ventured into Chile after India’s Ministry of Mines signed an agreement recently with Chilean national lithium mining company ENAMI. A team of officials visited prospective lithium blocks in Chile to secure offtake agreements for brine-type lithium.
India’s multi-faceted relationship with Latin America was consolidated in January with the announcement of import of 40,000 doses of bull semen from Brazil. Ironically, the semen comes from the Gir variety of bulls whose ancestors were sent from India over the past two centuries – till the export was halted by the government of India. The National Dairy Development Board (NDDB) of India has decided to genetically upgrade the Indian cattle stock. India is the largest milk producer in the world but per animal yield is low at 8-10 litres, while Brazilian cattle can produce an average of 20-22 litres. The transaction is the outcome of a successful decades-old relationship between India and Brazil, specifically Brazilian agri-research institute EMBRAPA and Indian Agricultural Research Institute (IARI). Brazil is focussing on energy, defence and agro-processing with India. In late February both countries held a Defence Dialogue focussed on strategic and technological cooperation.
The previous issues of Latin America & Caribbean Review are available here: LINK
