Lat-Am Watch: Correa plays a different tune

Ecuador's magna carta: Leftist not Leninist

Ecuador's president Rafael Correa received the backing of nearly two-thirds of the electorate on Sunday as voters approved a new constitution meant to bring more equality to the small Andean nation. Yesterday evening, with most of the vote counted, Yes was beating No by 64 percent versus 28 far exceeding the prediction of pollsters who put Yes at around 55 percent before the referendum.


Ecuador is the third country in the region to consider a new magna carta in just over a year. In 2007 both the Bolivian and the Venezuelan government rolled out draft constitutions.

In Venezuela, whose president Hugo Chávez is often considered the leader of a leftwing group including Correa and Bolivia's Evo Morales, the referendum ended in a failure for the government. Just over half the electorate disagreed with the constitution drawn up by the Chávez government. Those who voted against the draft were appalled at certain bills, which, for instance, allowed the president to be indefinitely re-elected.

As for Bolivia, Evo Morales was only slightly more successful than his ally in Venezuela. For although a slim majority of the constitutional assembly approved the draft, they had to do so without the opposition present and inside an army barracks for fear of the angry crowds seeking to stop the vote.

That highly controversial bill will be submitted to a popular vote at the beginning of next year, Morales has said, although recent violent clashes between government troops and separatists suggest the referendum might be postponed. The Morales constitution would mean a much more centralized distribution of income from fossil fuels and would allow for the creation of a parallel judiciary based on indigenous customs.

Given these two precedents and given the largely overlapping political outlook of the leaders of all three countries, you'd be forgiven for assuming that the constitution approved in Ecuador is just as extreme and controversial as the other two.

However, if we take a closer look at the bill passed on Sunday, we see that that's not the case. Ecuador's new constitution, although definitely leftist and progressive in its proposals, is a far cry from the anti-democratic charters drawn up by Chávez and Morales.

First and foremost, the power of the executive. Whereas Chávez aimed to be re-elected indefinitely, even promising to remain in power well beyond 2020, in Ecuador presidential ambitions are more restrained. Re-election is allowed only once and a term is set at 4 years, unlike the six-year term enjoyed by Chávez.

To bring the new system into place elections for all branches of government will be held at the beginning of next year. If Correa is elected – which seems pretty likely given Sunday's result – then that means he will remain in power at least another four years, and possibly eight, making his total time as president 10 years. Chávez, even without his new constitution, will have reached his first decade in power this December and still has four more years to go!

Add to that the fact that Ecuador, unlike Venezuela, has suffered from an overbearing and extremely corrupt congress that severely limited executive powers, mainly in the interest of more pork. Even many opponents of Correa agreed that the relation between the two powers needed to be redrawn in a more balanced setup.

Admittedly, the new constitution allows the president to dissolve congress, but only once during his term and elections must be convened immediately.

The Venezuelan draft constitution also awakened much opposition because of the way in which it seemed to undermine private property, by introducing new kinds of 'communal property' and stressing the 'socialist' identity of the state.

Ecuador's new bill of rights is certainly not liberal in any economic sense, earmarking large industries such as oil and telecommunications as "strategic" and therefore to be controlled by the state. The state is dealt the leading role in the economy and has the power to intervene in markets. But that still falls far short of actually dismissing the rights of companies or landowners on principle.

(Considering that the supposedly neoliberal Bush administration just suggested spending over 15 times Ecuador's GDP on nationalizing financial companies, you have admit that current trends are in Correa's favour)

Another marked difference is the way indigenous communities are treated. The charter drawn up by Morales' supporters in Bolivia foresees in a strengthening of Indian legal customs putting them on par with the regular judiciary in what would amount to something like an indigenist sharia.

In Ecuador, nothing like that is about to happen. Although the new bill of rights stresses the rights of indigenous groups and is even themed around the idea of Sumak Kawsay – or "decent living" in Kichwa – the rule of law is still firmly in the hands of trained judges. In fact many indigenous groups objected to the fact that the new constitution considers only Spanish to be the official language and does not add Kichwa as an alternative as is the case in Bolivia with Quechua and Aymara.

Other clauses in the document, such as allowing civil marriage for gay partners and free health care for the elderly amount to what many European countries consider basic human rights.

So far from being an anti-democratic and authoritarian, Ecuador's new constitution is in many ways a sensible charter. And although its economic outlook is overtly statist and more often than not clashes with the values defended in this column that still doesn't make it a blueprint for socialism.

The Unintentional Champion of Free Trade

Or how Chávez brings Colombia's FTA ever closer

Lat-Am Watch for the Buenos Aires Herald

It's not what you'd call a timely visit. Colombian president Álvaro Uribe showed up in Washington last Friday to pitch the Free Trade Agreement (FTA) between the US and Colombia, which is still pending congressional approval.


Just over a month shy of presidential elections and smack-bang in the middle of Wall Street's worst week since 1930, Uribe didn't exactly get the red carpet rolled out for him. But that didn't deter the Colombian, as he fights to get the deal approved before his ally President Bush leaves office in January.

That approval, however, is said to be more and more unlikely. With a Democratic majority in Congress and the US economy in a tailspin the chances of getting the agreement ratified are slim. If in the end it means that the deal doesn't go ahead, the result would be regrettable. Not only for US-Colombian relations, but also for relations between the US and Latin America in general.

It would send the wrong message to the entire region. After having been neglected by the Bush administration for the past 8 years, Latin America is in need of some reassuring signs from its northern neighbour. As the region's economies veer evermore towards Asia and even the Russians gain a foothold on the continent (look out for that fleet of ironclads headed to Venezuela!), the US really can't afford to sit out another round.

For countries such as Venezuela, Cuba and Bolivia, a US rebuff of Colombia will be seen as a victory against "Yankee Imperialism". As for those countries still sitting on the fence, such as Uruguay, Paraguay, Peru and, yes, Ecuador, a resounding No to the FTA will convince them of the need to enter agreements with countries such as Russia or China or anybody else ready to step in the void.

Obviously, there are many reasonable arguments against the signing of a Free Trade Agreement. One very serious one is the human rights abuses in Colombia, mainly against trade unionists. The killings of peasant-leaders and others have gone almost completely unpunished by the Colombian government. For years advocacy groups such as Human Rights Watch have been lobbying Congress to take these abuses into account when discussing any deal.

The fact that Human Rights Watch is abhorred by Uribe's lack of action is worrying and should be taken seriously. But when it's Democratic congressmen claiming they're against the Free Trade Agreement on human rights grounds, it doesn't ring quite as true.

Let's face it. Democratic congressmen, with the odd graceful exception, have a tendency to object to human rights abuses only in those places where there are few or no US interests at stake. After all, just a year ago 86 Democrats happily joined their Republican colleagues in approving a 120 billion dollar bill for the ongoing idiocy in Iraq, without even so much as a hint of when it would end.

The real concern has more to do with gut-populism than lofty morality. It's about the old fear of US-jobs going to lower-wage countries, a key-issue in the Obama campaign, who of course opposes the FTA with Colombia. Playing to those irrational fears is what an election year is all about. (According to the US Bureau of Labor Statistics both the number and, more importantly, the quality of jobs in the US has increased steadily over the past 25 years).

And think about it. Even if it were true that free trade is the cause of job losses, where would you rather have those jobs go? To Colombia, a friendly neighbour with no geopolitical cards up its sleeve, or to China?

Just in case you're worried that this is some veiled attack on Barrack Obama's candidacy, John McCain's policy on Latin America is equally based on playing to the electoral underbelly. His anti-immigration policies and support for that pharoanic wall on the Mexican border are about as out-of-touch as Obama's defence of tariff walls.

However, all is not lost. There's still a good chance the honourable elected representatives will approve the FTA for Colombia, opening the way for Peru and others. Recent events may be conspiring to convince the Democratic majority of the need to send a positive signal to the region, despite domestic economic woes and electoral rhetoric.

Those events are the expulsion of the US ambassadors by both Bolivia and Venezuela a fortnight ago. "That was a serious incident," Stephen Donehoo, a Latin America analyst based in Washington told BBC Mundo, referring to the harsh measures taken by presidents Evo Morales and Hugo Chávez. "The congressmen will certainly be taking that into account when they decide on the FTA," he added.

And if increasing anti-US rhetoric by the likes of Hugo Chávez is what's needed to push the Democrats into the Yes-camp so that Colombia can clinch its FTA, then Uribe may just be in with a chance. Because the Bolivarian is only just getting warmed up.

Consider this. Human Rights Watch complains about Colombia's record, but Venezuela actually kicks HRW out when they report abuse. How will that go down in Washington? And there's more coming. Chávez must divert attention from the swelling stench of corruption coming out of a Miami-courthouse as we learn more and more about the dealings of Antonini Wilson and the suitcase with 800,000 dollars in cash.

Moreover, he has to shore-up support as Venezuela approaches crucial mid-term elections for governors and municipalities in November. With rising crime staying abreast of sky-rocketing inflation, railing against Uncle Sam is about all Hugo Chávez has going for him. So next time he kicks out a diplomat or runs off an NGO, Colombians should be cheering him on.

New audio

Just posted the audio of my chat with New Zealand's Kiwi FM on the crisis in Bolivia in the bar over on the right. You can click on play to hear it.

Lat-Am Watch: Brazil stepping up to the plate

Lula assumes control in Bolivian crisis

All eyes yesterday were focused on the gathering of UNASUR, the nascent organization of South American states that is still trying to find a definitive arena for its branch of sport. For now, the presidents of Brazil, Chile, Argentina, Paraguay, Uruguay, Colombia, Ecuador and Bolivia were focused on the crisis in that last country, where violence has broken out once again in the ongoing conflict between the poor indigenous majority led by president Evo Morales and the mestizo minority, led by politicians in the rich region of Santa Cruz.



As was painfully clear from the start, the August 10 re-call referendum in Bolivia has done the country little good and instead worsened the divide between the two sides.

The current crisis, which intensified soon after the referendum results were in, has Bolivia teetering on the verge of outright civil conflict. Groups of armed campesinos have clashed with gangs of thugs, some of who go by the undeserved title of 'students'. These resulted in at least 28 violent deaths over the past week, many from bullet wounds.

The fights started in Santa Cruz last week, where groups of violent youths stormed and trashed government buildings. Soon after, supporters of president Evo Morales gathered on the roads around the city, blocking all access and supplies. In southern Tarija saboteurs caused a gas pipeline to explode, which cut gas exports to Brazil by as much as 55 percent for at least half a day.

Yesterday it looked like both sides had decided to step down and agreed a truce to allow for negotiations, although the public buildings in Santa Cruz remained occupied.

The main focus of the violence, though, was in the sparsely populated backwater Pando. According to some government accounts there were "Peruvian and Brazilian mercenaries" involved in a street battle there last Wednesday that left 8 people dead. In total at least 16 people died in the tropical region in northeastern Bolivia, where state presence is minimal.

As a result of the violence on Friday the government declared martial law in Pando. Government soldiers met with armed resistance at the airport, resulting in the death of one conscript and two employees of the local government, according to some news reports.

The prefect (governor) Leopoldo Fernández, an old ally of former dictator Hugo Banzer, was accused of resisting the government intervention and declared a fugitive. One government minister called him "the Butcher of El Porvenir," after the site of the killings, although Fernández told a local radio he had nothing to do with them.

Between acts, Evo Morales found time to expel the United States ambassador Philip Goldberg, alleging he was conspiring with the local authorities in Santa Cruz. No proof was offered, but Goldberg's role as a diplomat in the early stages of Kosovo independence was enough to brand him a secessionist. At his departure he vehemently denied any kind of intrusion in local politics.

When, with a big display of fanfare and crowd mongering, Hugo Chávez followed suit and sent the ambassador to Venezuela, Patrick Duddy, packing as well, it seemed reminiscent of that other crisis earlier this year. After Colombia bombed a FARC-camp in Ecuador on March 1, it was Chávez and not president Rafael Correa, who screamed murder and called for retaliation.

The tit-for-tat of diplomacy meant that not long after both the Bolivian and the Venezuelan delegation in Washington were packing their suitcases as well.

The situation is a mess and the struggle between the impoverished two thirds that support Morales and the richer 33 percent that reject him will continue as long as he remains in power.

The provinces to the south and east demand that they receive greater royalties for the gas and oil pumped from beneath their soil, and that the new constitution, approved by a simple majority, be filed away instead of being put to a popular vote in January.

But even if the vast economical and political bridges are gapped, there remains one unfathomable divide.

Evo Morales is still an Indian and the mestizo inhabitants of Bolivia's eastern lowlands still amount to the most perversely racist community in Latin America. They don't want an indigenous president. Period.

Despite the bleak outlook, though, it does look like some good is coming out of all this. The regional leadership of Brazil is finally coming into its own.

Brazil's president, Luis Inacio da Silva, showed initial reluctance at the UNASUR meeting, mainly because it wasn't clear that Bolivian authorities had expressed a need for outside intervention. After a call on Saturday by Chile's Michelle Bachelet, pleading for the Brazilians presence, Lula conceded. But on his terms, which, at press time, looked like they would be the cornerstones for any deal.

The Brazilian president demanded that both sides agree to a truce before the meeting, that La Paz accept his explicit negotiation in bringing about a more permanent settlement. He also called on the meeting to come up with a statement respecting the territorial integrity of Bolivia and that negative comments about the US be canned by those leaders inclined to lash out at Uncle Sam.

In other words, the US is an important and respected partner for all the region but the Bush-Doctrine has no place in South America.

It seems highly likely that Itamaraty, Brazil's foreign service, and the State Department conferred over the last few days. It also seems clear that the US feels its interests in the region are best served by a strong Brazil capable of countering the influence of Chavez' Venezuela. That's a good sign and one that hopefully will be followed up by the next administration in Washington.

Photo: EFE

Lat-Am Watch: Grasshoppers, not ants

Inflation and low remittances spell wintry days ahead.

If you found yourself in the unenviable situation of having to spend time in one of those random sprawling shopping malls in Guayaquil, Caracas or Mexico City during the weekend, you'd be forgiven for thinking that in Latin America we are on another planet.


For, while in the US and Europe consumers clutch nervously at their purse strings, in constant fear that their economy will run aground on the looming sandbanks of a whopping recession, the average Latino shopper acts as if life's a beach.

Like swarming ants, shoppers cover every square inch of those centros commerciales, stocking up on things no-one needs and gorging on food unfit to eat. And not because it's cheap, but because we think we can afford it.

But can we? Most indicators suggest that the region is better prepared than usual to face the approaching economic downturn. According to CEPAL, the UN's economic research institute for Latin America and the Caribbean, the region should expect to see a calming 4,7 percent economic growth in 2008. Less than in previous years, but nothing to alarm the average mall customer.

Next year growth is expected to slow to 4 percent. Not great, but still no real cause for alarm - a view that is broadly reflected. According to Spanish Economy Minister Pedro Solbes, the global "financial shocks" are only having a "modest impact" on Latin America, he was quoted as saying by InfoLatam.

That, he told a gathering of Spanish and local businessmen this weekend, was thanks to the "credibility" of regional economic policy. It was proof, Solbes insisted, that we had finally made a "qualitative leap" in our integration into the global economy.

However, there are serious signs that our newfound footing is a not as rock hard as the sight of the cheerfully consuming masses would suggest. But to actually see the cracks in the floor, you have to look down.

The number of poor people in Latin America will increase by 15 million this year, according to CEPAL. Inflation is to blame, gnawing away at people's purchasing power. The less you have, the more it affects you.

Over 2008 the increase in prices is expected to reach 8,9 percent, almost twice the growth rate. Even worse, food prices are going up by 15,7 percent region-wide. The more of your budget spent on feeding your family, the harder you get hit.

Some countries are worse off than others. In Bolivia inflation is up to 17 percent and in Nicaragua it's even 23. President Hugo Chávez's Bolivarian budget has helped fuel the rise in prices in Venezuela to a dizzyingly high 32 percent. As for Argentina's official 9 percent – that's starting to sound like a broken record.

It's not only inflation that is eating away at the income of poorer households. Although the economic indisposition of the US and EU is not being mirrored here in the region, the secondary effects are already becoming clear. Foremost among them is a sudden decline in remittances.

The influx of cash sent home by Latino workers in Europe and the US is one of the mainstays of the economy in many Latin countries. Besides, the Euros or dollars wired home by a relative are often what keeps a family from slipping into destitution.

Spain and the US, the two countries that absorb the greatest number of immigrant workers from Latin America, are also two of the hardest hit by the credit crunch. As a result of lay-offs and consumer wariness, immigrants are forced to cut back on the money they send home.

According to the Spanish Central Bank, between January and March, remittances dropped by 2,6 percent compared to the same period in 2007. The first dip in a decade according the researchers at Remesas.org.

In Ecuador remittances have also been in decline this year, decreasing by as much as 7,7 percent in the second quarter of this year. Only 711 million dollars found their way to the small Andean nation, compared to 771 in the year before and compared to 759,6 million dollars in the months of January through March.

For Ecuador, where almost every family has someone working in the US, Spain or Italy and where remittances add up to more than 15 times the amount received in foreign aid, those figures are very bleak news.

Mexico, the world's third largest recipient of remittances after China and India, also saw a significant drop this year. In July the amount of money received was almost 7 percent less than in the same month in 2007, Mexico's central bank announced last week.

The main reason, according to Jesús Cervantes of the bank's research division, was the slump in the US construction business where around 20 percent of Mexican immigrants work. The recent slide of the dollar has also put pressure on the value of money sent to those back home.

Therefore, despite the lukewarm promise of growth for the next twelve months, the overall outlook is not good. Most analysts maintain that Europe and the US are still not in the clear, despite Sunday's massive bailout.

While their economies struggle, more and more Latino immigrants will find it harder to send cash home. Meanwhile those who stayed behind face inflation rates far greater than rising incomes, especially for the millions who work in Latin America's massive informal economy.

You don't need to be a mall-o-phobic like me to figure out that those who buoyantly swipe their way into oblivion have less in common with laborious ants than they do with the fabled idle grasshopper who got trapped by winter with no food to spare.

Lat-Am Watch: Coup, cries Lugo

Oviedo said to be up to his old tricks in Paraguay

When Fernando Lugo took over the presidency of Paraguay last month after 61 years of rule by the Colorado party, we knew he was in for a rough ride. The Colorados, still entrenched in every corner of bureaucracy and well represented in parliament, were unlikely to make the former bishop's incursion into politics an easy run.

But if Lugo is to be believed, some members of the opposition are more than just obstreperous. They are planning a coup d'état.


In a press conference on Monday morning Lugo accused former president Nicanor Duarte Frutos and opposition leader Lino Oviedo of meeting secretly with the Senate chairman, a superior electoral court judge, a prosecutor and a general in what he called a meeting with "coup intentions."

Basing his accusations on the testimony of the General Máximo Díaz, who apparently was present at the meeting against his own will, Lugo claimed that Díaz had been quizzed by ex-military chief Oviedo about the army's loyalty. The general had immediately reported the incident to his superiors.

"As president I will not allow the armed forces to be used for sectarian interests. I call on the public to be alert for possible coup attempts. We will not permit an attack against the freedom of our people," the president declared.

In a later press conference Lino Oviedo confirmed meeting with ex-president Duarte Frutos, but said the meeting on Sunday night had been about rallying to "support the government of Lugo."

As for the General Díaz, Oviedo denied that the soldier had been in his house at the time.

Manuel González Quintana, who belongs to Oviedo's UNACE party and is speaker of the senate, immediately denied having being present at any such meeting, as did the controversial judge Juan Manuel Morales, whose rulings have favoured Duarte Frutos on too many occasions in the past.

These accusations of an alleged coup are inextricably linked to the current crisis in the Paraguayan senate.

A stalemate has occurred in the upper chamber after González Quintana and a few other Oviedo-supporters allowed Nicanor Duarte to swear-in as senator, despite the majority of the house insisting he be named senator-for-life, as the constitution mandates for a former president. That role would strip him of the right to actually vote, which is why Duarte ran for senator during the last elections, in the hope of maintaining his influence.

The theory holds that Oviedo and Duarte are in league with each other to bring about the downfall of Lugo and his vice-president Federico Franco, placing senate speaker González Quintana in line for the throne. That's how the editorial of ABC Color, Paraguay's leading newspaper, put it on Sunday.

"There's no doubt that Oviedo and Duarte are trying to destabilize Lugo's government, " says Roberto Gonzalez, a political analyst for the newspaper on the phone from Asunción. "But if they really met to discuss a coup then it's backfired considerably, because the public is outraged," González explained. Social movements have announced a mass rally in support of president Lugo to be held on Thursday.

In fact, the whole affair looks like it could be panning out well for the fledgling government of the former prelate. Now that the "coup-plotters" have supposedly been outed, the senate confrontation looks likely to end with the dismissal of González Quintana as speaker and the reversal of Duarte's installment as ordinary senator.

Of course, as the journalist González points out, Lugo could be making the whole thing up precisely to get his way in the upper chamber and discredit his enemies. In Paraguay nothing is ever straightforward.

The truth is the government has made a lot of mistakes in dealing with the situation in the senate. In a ham-fisted attempt to appoint two elected senators as ministers and fill their places with loyalists instead of following the constitutional rules, Lugo and consorts paved the way for Duarte Frutos own display of bending the law in the upper chamber.

The worst mistake though, was to allow congress to appoint a lackey of Lino Oviedo as senate speaker.

For those unfamiliar with the man's record, Oviedo has already been convicted of a coup once in his life, in 1996. Oviedo also participated in the coup against the dictator Alfredo Stroessner in 1989, not to mention his alleged involvement in the murder of vice-president Luis Argaña in 1999. While he was in hiding in Brazil his supporters in the military attempted to overthrow an elected government in May of 2000. In short, he's an enemy of democracy.

Yet, after coming third in the presidential elections this year, Oviedo offered to support Lugo's allies in parliament. An offer that the former bishop snapped up too quickly. Now, that honeymoon seems to have come to a nasty end.

From now on Lugo will have to look for allies in the ranks of the Colorado party, whose hegemony he ended with his historic victory on April 20. That's not as bizarre as it sounds.

There are many among the ANR (as the party is officially called) who are sick of Duarte Frutos openly corrupt dealings and who blame him for the electoral defeat. Foremost among them is Luis Castiglioni, who claims he was cheated out of the party nomination by the ex-president, in favour of April's loser Blanca Ovelar.

Lugo should seize this chance to reach out to all those in the sprawling Colorado party who reject the back-room machinations and the scheming with generals and want to see Paraguay progress as an open democracy. There are probably more of them than he thinks.