Tuesday, February 28, 2006

No Vacancy

Mexico City officials finally closed the Sheraton Hotel that kicked out a Cuban delegation to comply with the Cuban embargo.

However Management of the Sheraton Maria Isabel is defying the order and says operations continue as normal.

This incident has become a major campaign theme. Mexican Presidential candidates have chanted outrage in chorus.

US officials have supported the hotel move. They reckon the Cuban embargo applies to American companies operating overseas.

Mexican Foreign Minister Luis Ernesto Derbez has declared to media that US law could not be applied in a third country.

By no complying with the order the Sheraton is just getting things worse with a display of arrogance that won’t be welcome in Mexico and can only affect America’s image.

Monday, February 27, 2006

Close Race

The race is closing down a month before Peru's Presidential Election.

Leading candidate and free marketer Lourdes Flores recorded a 2% drop in just ten days.

Leftist candidate Ollanta Humala gained 1 point during the same period.

Former president Alan García recorded the largest rise with a 5% gain in ten days.

The numbers, produced by Apoyo, Opinión and Mercado pollster are as follows:

Flores 33%
Humala 26%
Alan García 22%

The actual news here is the dramatic increase of charismatic Alan García. His years in office are described by the BBC as "marked by hiperinflation, food queues, allegations of fraud and an upsurge in guerrilla violence."

Election is April 09, 2006. A run-off looks unavoidable.

Sunday, February 26, 2006

Rice Eaters

Condoleezza has a difficult trip scheduled for March the 11th. She is attending the inauguration of the first ever South American President, Chile’s Michelle Bachelet. Problem is she may not enjoy the company. Secretary of State will be hanging with regional presidents not exactly of her like, namely Hugo Chavez, Evo Morales and Nelson Kirchner.

Expect her to spend time with Alvaro Uribe and do not be surprised if she tries to ignore Chavez at all costs, as W did in Viña Del Mar.

A Coming Wolf?

Venezuela’s man in Washington, Bernardo Álvarez, just did it again. He hinted that oil supplies to the US could be halted if the diplomatic crisis escalates. This threat has become a theme in Chavez’s speech and a common place among Venezuela’s diplomats.

Is it possible? Can Venezuela cut oil supplies to the US?

Only if Chavez is willing to take an economic shock stronger than 2002's national strike.

During his congressional hearings, Thomas Shannon, US Undersecretary of State for Hemispheric Affairs, clearly articulated the dilemma :

"Venezuela in reality does not sell petroleum to the USA ... it sells it to itself."

Citgo, A Venezuelan oil company, buys Venezuelan oil to refine in US based Venezuela’s refineries. Then it sells the gas in Venezuelan Citgo gas stations. We are talking of roughly 1.4m barrels per day and close to 60% of Venezuela’s oil exports.

Chavez is a big gambler. He already survived a more difficult crisis, one that involved an internal enemy. An external enemy, he may think, would bring the country together.

Saturday, February 25, 2006

Fox Taming

The Mexican Supreme Court ordered President Fox to stop the broadcasting of TV spots promoting governmental social programs under the tagline: “If we stay the same way tomorrow’s Mexico will be better than yesterday’s”.

Although Vicente Fox is not running, the Supreme Court considered these ads would benefit ruling party candidate Felipe Calderon.

Recent opinion polls give leftist candidate Manuel Lopez Obrador a 5-9% lead over both, Felipe Calderón and Roberto Madrazo from the Institutional Revolutionary Party (PRI) that governed Mexico for more than seventy years.

REUTERS reports these results from two different polls:

Milenio Diario’s (A newspaper) Survey:
-Manuel Lopez Obrador (PRD): 36%
-Felipe Calderón (PAN): 31%
-Roberto Madrazo (PRI): 31%

Consulta Mitofsky Survey:
-Manuel Lopez Obrador (PRD): 39%
-Felipe Calderón (PAN): 30%
-Roberto Madrazo (PRI): 28%

López Obrador has been characterized as a left-wing populist by media. Mexico is the largest Latin American economy. Election day is Sunday, July 2.

Friday, February 24, 2006

Understanding Chavez

Here goes a quote from Venezuela’s Chief Prosecutor, Isaías Rodríguez explaining the psychology behind Chavez’s polemic proposal of indefinite reelection:

“President Chavez and I come from the llanos [Flat lands] and we have an Andalusian formation that makes us exaggerate so people can understand some things. Llaneros are exaggerated and that allows for a different communication than normal (…) It’s possible that this was just a llanero expression used by the President. It shouldn’t be seen as a threat. It’s just a way of telling things with a very personal language, a language that it’s not necessarily the language used by some people that read a specific political meaning in his comments and not the deep meaning from the colloquial llanero language.”

By the way, as Chief Prosecutor and in line with the separation of powers stated by the Venezuelan Constitution, Rodríguez's role is not to justify presidential delusions but to actually go after him if he dares to abuse power.

Sunday, February 19, 2006

Per Secula Seculorum

Two fresh proposals from Chavez:

-Make of Venezuela's presidential elections scheduled for December a plebiscite, if the opposition withdraws.

-Call a referendum to allow him to run for the presidency unlimited times. "Although I am not sure I can resist forever".

I won't get into the ethics of changing the constitution to have oneself reelected. I will also avoid arguing about the convenience of an eternal presidency. I won't even say that at this rhythm Venezuela's constitution will decree presidential infallibility. I will only ask why is he already in campaign? Isn't he popular enough? Doesn't he know it is illegal to do so 12 months before the elections and to use public means for proselytism?

Friday, February 17, 2006

Unlikely Partners

Condoleezza Rice calling for a united international front against Venezuela doesn’t come as a surprise. The US-Venezuela confrontation has escalated from rhetoric to diplomatic in the last few weeks. But the hint that Brazil may join the “united front” and the lame Brazilian response to Rice’s comment is raising a few eyebrows.

Observers have long speculated of a potential separation between Brazil and Venezuela. Lula, they reckon, doesn’t entirely trust his neighbor and has tried to keep distance.

Let's be reasonable. What on earth could Lula get from the US now that he is finally leading the polls? His administration would only trade Venezuela with the US for something really, really huge such as, voila, a permanent seat in the UN security council.

Hold on. Brazilian interests in Venezuela are considerable. To break with Venezuela Lula would need a lot more than his long sought after security council seat. Well, perhaps the US is considering a more aggressive offer, like the opening of the market for Brazilian agricultural exports.

A seat in the security council and a new market for Brazilian orange juice would gain a lot of votes for Lula. Some would think than more than he would lose by separating from Chavez.

They say everything is possible.

Wednesday, February 15, 2006

Preval to Prevail

A Brazilian official proposed a sensible way out to the Haitian electoral crisis: “It would be ideal if the candidates acknowledge to have lost and also recognize Preval’s victory”, reads a BBC quote from Marco Aurélio Garcia, a Brazilian representative to the UN mission overseeing the electoral process.

The head of the UN mission, US envoy Martin, also proposed a potential way out during an interview to the Argentine news agency Telam: "If the blank votes are not counted, Preval would have approximately 51 per cent, but that would mean changing the Electoral Law, and that does not seem appropriate since it could be seen as being done to favour one candidate over another."

The political future of Haiti is being negotiated amid public demostrations. The UN has an opportunity to put an end the the electoral crisis.

Saturday, February 11, 2006

Long Live to Coca. Death to the Yankees

Bolivia’s President addressed his nation in front of a banner that read: “Long Live to Coca. Death to the Yankees”.

With such a that tag line, you would think Mr. Morales would announce the total legalization of Coca, a measure that would, to say the least, anger the very same country he wants dead. But instead of legalizing it, Mr. Morales actually asked farmers to voluntarily control production and adhere to a coca “cato” established by the former administration; a system that limits coca production to the Capare region and establishes a 1.200 square meters top per planting family. Morales also asked farmers to control production by themselves.

Morales actually thinks that a controlled market for legal coca derivatives can be regulated by producers. That is like asking AT&T to regulate the telecommunications market. He forgets the actual reason why farmers resort to coca: price. Since it is used to produce an illegal substance the plant sells well in the black market. Opening a market limited to legal coca derivates will only increase pressure on price and production will boom even more in Bolivia, if regulation is voluntary, or elsewhere, if regulation is forced.

No doubt coca will live long. If Morales asks farmers to voluntarily regulate a legal market, it will probably live forever.

As for the Yankees dying, it will take a bit more than asking farmers to respect a system of quotas to “stop the U.S. talking badly about us."

It Ain't Over

Rene Preval's lead in the Haitian presidential election is down 10 points to 50.2%, which means a second round is possible.

To gain in the first round Mr. Preval needs 50% of the votes.

Preval's supporters are calling it a fraud.

What yesterday looked like a smooth transition to a new administration with a clear mandate, it's looking now like a time bomb.

Friday, February 10, 2006

Prodigal Son

Media are reporting a landslide by Rene Preval in the Haitian presidential race. Preval is described by as an ally of ousted leader Jean-Bertrand Aristide.

Aristide was deposed two years ago and has since accused the US of plotting his ousting. He is now in South Africa and will be allowed to come back as soon as the South Africans consider the situation stable enough.

Two things are for certain:

-If vote counting keeps its current trend Preval will be millionaire in political capital: 60% of the vote with levels of participation above 70%.

-Aristide will likely be a prodigal son for Haiti and the US will have to deal with other unfriendly leader.

We were too many and grandma gave birth, says a Spanish proverb.

Tuesday, February 07, 2006

Armed to the Teeth

Beyond Latin America's left turn, there is a worrisome regional trend most analysts are overseeing: regional militarization.

A military build-up has taken place since the US lifted a ban to sale high-tech weapons in 2002.

Only in 2005 Colombia received close to US$ 643.3 million in American military and police aid.

Brazilian Air Force is investing heavily in modernization. Imports by the force increased by 177.5% in the first half of 2005 compared to the same period last year. That translates in US$ 34 billion in purchases for that period and a 20% increase from 2004. All due to the Brazilian Air Force Operational Recovery Program (PROFAB) implemented since 2002. Brazil already has the strongest regional air force.

Chile is buying 10 brand new F16 aircraft from the US and 18 second hand F16 from Holland for a total investment of US$745 million. Other ongoing Chilean acquisitions include two Spanish-French submarines, eight used Dutch-British war ships from Britain and 100 German Leopard tanks.

Venezuela is importing 100,000 Russian Kalashnikov assault rifles, and may import as any as 400,000 AK-47s. There are plans to buy up to 50 Russian MIG fighter aircraft. In addition, the regime is purchasing military hardware from Spain. Venezuela has also expressed interest in the development of nuclear energy for purely “peaceful purposes”. Some sales have been blocked by the US but Venezuela government will eventually get his military gear from other nations.

Sergey Svenchnikov, a representative from Russian state arms company Rosoboroneksport, put it this way in a recent visit to a weapons fair in Buenos Aires: "These countries' requirements for modern weapons are considerable. This is because the armed forces of most of the countries of this region intend to renew their armaments and military hardware in the very near future."

Friday, February 03, 2006

Falling Star

Hugo Chavez’s vote intention is below 50% for the first time since 2004, reports a survey conducted by Venezuelan pollster Datanálisis. That is a dramatic fall from the 71.8% recorded last July by the same surveyor.

Chavez’s vote intention has roller coasted from 30% in July 2003 to almost 80% last year and is now below the 50s.

Other interesting numbers reported in the survey are:

Declared Chavistas are 43% of the population, 35% defined themselves as neutral and 15.5% as opposition.

Trust in Chavez is at 53% and distrust at 35.5%.

This survey confirms a trend first reported last January by DATOS, other local surveyor. DATOS measured trust on Chavez at 43% and gave his party Movimiento Quinta República a vote intention of 37.6%.

Chavez´s star is falling, but not fast enough to risk his office. Opposition is fragmented and alternative leadership is virtually nonexistent.

Thursday, February 02, 2006

Persona Non Grata

It was a big occasion. Venezuela’s President Hugo Chavez Frias was to commemorate his seven years in government with a televised speech. It was a chance to tell his people about his revolutionary achievements. However, he chose instead to broadcast another episode of his anti-American soap opera.

In what was the most dramatic moment of his speech he announced to a frenzy audience that a US Military Attaché had been declared “persona non grata” and expelled from the country on the grounds of espionage.

“U.S. Navy Capitan John Correa must leave the country immediately” was the one line quoted by media all around the world.

As for the seventh anniversary, well, nobody remembers it now. Perhaps he meant so. There is no much to celebrate in Venezuela. Better to divert the attention and blame American imperialism for everything. After all, this little trick has long worked in Cuba.