China's Growing Clout In Latin America And The Caribbean

China's state banks have loaned some $140billion to Latin American and Caribbean countries since 2005, which is thought to be just a fraction of the money that has flowed to the region when private deals are taken into account. Beijing is also involved in major infrastructure and energy projects in most countries, including transport networks and power stations  

Daily Mail: China's take-over in America's back yard: How Beijing has spent $140BILLION on ports, roads, and power plants in Latin America and the Caribbean as Cuba signs a new energy deal while US influence fades 

* Cuba has agreed a new deal with China to upgrade its power grid, inviting Chinese firms to invest and build 

* It is just the latest of Beijing's loans, building projects, and investments to Latin America and the Caribbean 

* China has also rapidly increased trade with the region which rose from $12bn in 2000 to $315bn in 2020 

* America has been muscled out of its own back yard, as diplomats warn the US is 'giving up without a fight' 

On the face of it, America has little to fear from China's new deal to upgrade Cuba's power grid. 

The countries are already firm allies via their Communist leaders, Havana is under a diplomatic and economic embargo from Washington, and all efforts to mend ties between the two ended when Obama left office. 

But scratch the surface and what emerges is a picture of Chinese economic dominance in America's backyard that would be enough give any president sleepless nights. 

In fact, the deal with Cuba - signed this week as part of China's trillion-dollar Belt and Road Initiative - is just the latest in a long line of loans, trade deals, construction projects and other investments in Latin American and the Caribbean that has seen Beijing flex its growing economic muscle while America's strength wanes. 

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WNU Editor: China has to recycle the hundreds of billions that it gets each year from its export surpluses to the U.S. and the rest of the Americas. This is one of the ways that it accomplishes this. 

But I think this type of investment is about to end.

China's real estate and bond markets have collapsed in the past two months, and it will be needing this money to solve its liquidity crisis. 

This money in Latin America and the Caribbean is also not free. 

Much of it is in the from of loans with interest rates that are in my opinion very steep. Good luck on collecting that type of money from countries like Venezuela, Argentina, and Cuba .... countries with a long history of defaulting on loans.

IMF Raises The Alarm That Social Unrest May Spread Across Latin America And The Caribbean

Reuters: IMF concerned over post-COVID social unrest across Latin America - official 

NEW YORK (Reuters) - The International Monetary Fund is concerned that social unrest will make a comeback in “lots of countries” across Latin America once the COVID-19 pandemic recedes, a top IMF official said on Thursday. 

Economies across Latin America and the Caribbean are forecast to contract as a group by 8.1% this year, with an uneven 2021 bounce at just 3.6%, and most countries are not seen returning to pre-COVID output levels until 2023, the Fund said earlier on Thursday. 

“Some of the determinants of social unease are going to worsen and that generates our concern for the region, for lots of countries in the region,” Alejandro Werner, the Fund’s director for the Western Hemisphere, said in an interview with Reuters.

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WNU Editor: The IMF's concerns are justified. Predictions are calling for an almost 10% drop in the GDP this year .... Latin American GDP to fall by 8.1% in 2020 (ICIS). And if the pandemic continues, expect an even bigger drop next year. The IMF report is here .... Pandemic Persistence Clouds Latin America and Caribbean Recovery (IMF).

Extreme poverty rises again in Latin America

Reuters: Number of Latin Americans in extreme poverty highest since 2008: U.N. agency

(Reuters) - The number of people living in extreme poverty in Latin America increased in 2017 to the highest level in almost a decade despite an improvement in government social spending policies, a United Nations agency said on Tuesday.

The Economic Commission for Latin America and the Caribbean (ECLAC) said the proportion of people in extreme poverty, which is characterized by lack of access to basic human necessities like food and shelter, rose to 10.2 percent of the population in 2017, or 62 million people, from 9.9 percent in 2016.

The figure is the highest since 2008 and largely due to an economic deterioration in Brazil, which has only begun to rebound in the last year from its worst recession in decades. Brazil has about 200 million people, making it Latin America’s most populous nation.

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Update #1: Extreme poverty rises again in Latin America (France 24)
Update #2: Extreme Poverty Increases in Latin America, reports ECLAC (Prensa Latina)

WNU Editor: Economic and political turmoil in Brazil for the past few years, coupled with the disaster in Venezuela, is the reason for this increase in extreme poverty.

Brazil's Interim Government Dismisses Criticism By Leftist Countries In Latin America

Reuters: Brazil rebuffs Latin American leftists over Rousseff suspension

Brazil's interim government dismissed criticism by leftist countries in Latin America, including Venezuela, Cuba and Bolivia, over the impeachment process of Dilma Rousseff, who was suspended as president by the senate.

The leftist president of El Salvador on Saturday added to the regional pressure on Brazil, saying that he would not recognize the interim government and recalled his ambassador, claiming there had been "political manipulation" in Latin America's biggest country.

The bickering, not rare between leftist leaders and more conservative governments at a time when much of the region is moving to the right, comes as centrist Michel Temer, Rousseff's vice president, assumes Brazil's presidency and scrambles to pull the economy out of its worst recession since the 1930s.

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WNU Editor: Everyone is nervous in Latin America on where Brazil's instability may spread.

A Latin American Alliance?

Mexican President Enrique Peña Nieto, Colombia’s President Juan Manuel Santos, Chile’s President Sebastián Piñera and Peruvian President Ollanta Humala (from L to R) at a news conference after the Community of Latin American and Caribbean States (Celac) Summit in Santiago, Chile. Photo: Agencia Uno/Xinhua/Sipa USA

The Most Important Alliance You've Never Heard Of -- Moisés Naím, The Atlantic

Latin American countries have failed to work together for two centuries. That may be about to change.

In Venezuela, students have been killed while protesting against the government of Nicolás Maduro, who is jailing opposition leaders and just closed a television station that dared broadcast the demonstrations. Argentina is irresponsibly racing toward a dangerous economic cliff. The Brazilian economy is in recession and 2014 will mark its fourth consecutive year of subpar growth, as the country reels from its largest capital flight in more than 10 years.

Is a decade of progress in Latin America coming to an end? For some countries, surely. But not necessarily for the entire region. Four nations are developing an initiative that could add new dynamism to Latin America, redraw the economic map of the region, and boost its connections with the rest of the world—especially Asia. It could also offer neighboring countries a pragmatic alternative to the more political groupings dominated by Brazil, Cuba, and Venezuela.

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My Comment: This is a start .... and if a major country like Brazil participates at a later date .... a change for the good.

Latin America's "New Dictators"

Venezuela's President Hugo Chavez greets supporters during an election rally in the central state of Guarico, 200 miles south of Caracas, on July 18, 2012. Chavez has a strong lead in most opinion polls as he seeks to beat opposition challenger Henrique Capriles and win a new six-year term in an October 7 election. Reuters

Latin America’s New Authoritarians -- Washington Post

CARACAS, Venezuela – More than two decades after Latin America’s last right-wing dictatorships dissolved, a new kind of authoritarian leader is rising in several countries: democratically elected presidents who are ruling in increasingly undemocratic ways.

Unlike the iron-fisted juntas of a generation ago, these leaders do not assassinate opposition figures or declare martial law.

But in a handful of countries, charismatic populists are posing the most serious challenge to democratic institutions in Latin America since the 1980s, when rebel wars and dictators were the norm. In Venezuela, Ecuador, Nicaragua and other countries, leaders have amassed vast powers that they use to control courts while marginalizing their opponents and the media, human rights groups and analysts say.

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My Comment: Goodbye to the old boss .... hello to the new boss.

No Resolution To The Boundary Dispute Between Costa Rica And Nicaragua

A Post-Modern War in Central America -- World Politics Review

What happens when a country without an army discovers that soldiers from a neighboring state have marched into its territory and raised their own flag? That's exactly what the government of Costa Rica, which has no military forces, charges Nicaragua has done, accusing its neighbor of invading its land and destroying its forests. Nicaragua, not surprisingly, sees things differently.

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More News On The Costa Rica - Nicaragua Border Dispute

Costa Rica Headed To The UN Over Conflict With Nicaragua -- Inside Costa Rica
Costa Rican to talk with UN on Nicaraguan dispute -- Washington Post
Nicaragua Reaffirms Stance in Conflict with Costa Rica -- Inside Costa Rica
The Tide Turns for Daniel Ortega -- Front Page
Costa Rica's Border War with Nicaragua: A Boost for Ortega? -- Time Magazine
Costa Rica-Nicaragua Dispute Goes Viral -- Americas

Should Latin Leftists Fear A Honduras Coup Domino Effect

In this June 29, 2009 file photo, Bolivia's President Evo Morales, left, Honduras' ousted President Manuel Zelaya, second left, Nicaragua's President Daniel Ortega, third left, Venezuela's President Hugo Chavez, fourth left, and Ecuador's President Rafael Correa pose for a photo at the Bolivarian Alternative of the Americas group, or ALBA, in Managua. Zelaya's chances of getting restored to the Honduran presidency become more distant with each passing week, and across Latin America, his allies and foes alike see a precedent being set. (AP Photo/Arnulfo Franco, File)

From AP:

TEGUCIGALPA, Honduras — Manuel Zelaya's chances of getting restored to the Honduran presidency become more distant with each passing week. Across Latin America, his allies and foes alike see a precedent being set.

It's a glimmer of hope for the region's conservative elite, which has watched with dismay over the past decade as a wave of leftist presidents has risen to power, promising to topple the establishment and give greater power to the poor.

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My Comment: I cannot see any changes in the governments of Venezuela, Nicaragua, Ecuador, or Bolivia anytime soon .... but there are long term currents that does put everyone at risk.

For example ... in Venezuela there is a great deal of animosity and anger directed at Hugo Chavez from University students, unions, and what remains of the business middle class. But with the backing of the military, his corp of civilian supporters (of which a good chunk of the poor in the country are represented), as well as every instrument of government .... Hugo Chavez has (and will) maintain power. The only way that the dynamics of Venezuela can possibly change is if it's oil spigot gets cut off .... but I doubt that this is going to happen in the short term.

Bolivia's problems are different. President Morales may be a socialist, but his power base is from the poor and indigenous people of the country (of which he is one of them). His opposition comes from people of European Spanish descent .... and who also happen to own the most productive parts of the country. This ethnic/racial conflict is the most worrisome .... because it is these type of conflicts bring out the worse in people, and for Bolivia this has not run its course.

Ecuador and Nicaragua are two pathetic and poor countries. They subsist on the generosity of Venezuela, and have little if any prospect of improving their social/economic status. Their value in the scheme of things is their strategic locations .... and even then I am not be impressed by that.

If there is a leftist government that is going to change, it is going to be Argentina. Mismanagement and corruption has completed discredited the Government, and with all of its economic and management decisions now coming home to roost in the form of high unemployment and inflation.... there will be a change in the Presidency in the next Federal election.

Two More Troubling Stories From Latin America

Daniel Ortega

Nicaragua's Sandinista Dissidents Turn Against ‘Sespot’ Ortega -- Times Online

Her achievements as a Sandinista guerrilla commander 30 years ago earned her a place in the pantheon of Nicaragua’s revolutionary heroes. But while thousands will flood the streets of Managua tomorrow to celebrate the 30th anniversary of the Sandinista victory over the dictator Anastasio Somoza, Dora Maria Téllez will stay away.

Ms Téllez is one of a growing number of Sandinistas who have broken with the government of Daniel Ortega as, they say, he completes his transformation from revolutionary to “caudillo” — one of the Latin American despots he once so despised.

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In this frame grab taken from an undated video found on a computer seized during the arrest of an alleged senior operative of the Revolutionary Armed Forces of Colombia, FARC, in Bogota shows the rebel groups number two commander Jorge Briceno aka Mono Jojoy. The Associated Press has obtained the video that appears to dispel any doubts that Colombia's main rebel army gave money to the 2006 election campaign of President Rafael Correa of Ecuador. (AP Photo/APTN)

Ecuador Denies Links With Colombian Rebels -- Reuters

QUITO (Reuters) - Ecuadorean President Rafael Correa never received funds from Colombian rebel group FARC, his government said on Friday as he sought to refute the content of a video aired on Colombian television.

A top FARC leader said in the video that the guerrillas donated cash to Correa's presidential campaign.

Ecuador denied that leftist Correa's campaign got any money from the FARC, which is branded a terrorist group by Washington, and accused Colombia of launching a "media offensive" against Correa.

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Previous Post: Rebel Video Hounds Ecuador's Correa

Update: Colombia: rebels funded Ecuador leader's election -- AFP

My Comment: Latin America has a long history of dictators and strongmen. I guess the tradition and culture has not changed.

Latin America's Quiet Revolution

Chilean President Michelle Bachelet delivers her annual message
to the nation at the National Congress in 2007. Getty Images

From The Wall Street Journal:

The Mexican government is locked in a vicious war against powerful drug cartels which assassinate public officials seemingly at will. Bolivian President Evo Morales's constitutional rewrites threaten to push the country toward civil war. Venezuelan President Hugo Chávez persecutes his political opposition, supports the FARC rebels in Colombia and is training a civilian militia supposedly designed to defend against an impending U.S. invasion.

A report by the U.S. Joint Forces Command released earlier this month calls Mexico a potential failing state, likening it to Pakistan. This assessment is particularly striking in light of the $400 million per year that the United States provides in military and security assistance to Mexico. It also adds urgency to the U.S. government's plans to complete a 700-mile-long border fence and dramatically expand the number of Border Patrol agents, to over 20,000 by the end of 2009 from 11,000 in 2004 -- both of which have opened a rift between Washington and Mexico City. Our relationship to Venezuela is even more strained. In 2004 the Bush administration refused to continue our policy of selling military hardware and spare parts to the Venezuelans, prompting the Chávez government to not only purchase fighter-bombers, helicopters and 100,000 assault rifles from Russia, but to invite the Russian navy for joint naval maneuvers.

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My Comment: This revolution has been going on for a very long time, the difference is that the main stream media is only now starting to notice. The first revolution is the old Cuban style of perpetual government run by the same political party. Consolidating power and the benefits that it can give to the ruling elite has proven to be a seductive drug for many of the regions strongmen. Suppression and control of the media and press, control of unions, and the involvement of the state in economic affairs to an even greater level ..... this is the message that is prevalent in countries like Nicaragua, Cuba (of course), Venezuela, Ecuador, and Bolivia.

Their problems of these countries were always masked by high commodity prices and oil/energy prices. But this situation has completely changed in the past 6 months. With the worldwide recession now in full force, these governments are now having difficulties with the man in the street .... and in some cases ..... even with their own supporters. They are running out of money .... a problem that will only get worse with time.

The true stars in Latin America ..... and who represent the real revolution in Latin America ..... are those who have gone down a different path. Open markets, government accountability, and a parliamentary system rooted with strong democratic principles .... these states are the ones that are clearly succeeding throughout Latin America.

So .... what does the future hold? I see two Latin Americas. The haves and the have nots. This will naturally cause stresses in many parts of the continent, but more so in the countries who have decided to continue with the Castro-Chavez view of what Government is, and how it should function in todays world.

For the others, they are experinecing an economic and political revolution that will be the envy of those in Latin America who are living under the old mentality. Their success will be our success .... and will in the long run be a stabilizing factor throughout the Americas and a true beacon for change.

Pentagon’s Controversial Strategy for Latin America

Hat Tip: War is Boring

Bolivia: Expel All US Ambassadors

Bolivia's President Evo Morales talks to Brazil's President Luiz Inacio Lula da Silva during the summit of Latin American and Caribbean leaders in Costa do Sauipe, Brazil, Wednesday, Dec. 17, 2008. The two-day summit is aimed at strengthening political and economic ties in the region. (AP Photo/Andre Penner)

From Yahoo News/AP:

COSTA DO SAUIPE, Brazil – Latin American nations should expel U.S. ambassadors until the United States lifts its embargo on Cuba, Bolivian President Evo Morales said Wednesday. But his remarks found little support from other regional leaders.

Morales made the demand during a summit of Latin American and Caribbean leaders in this beach resort in northeastern Brazil.

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The Monroe Doctrine Is Dead

(Click to Enlarge)
Image from the University of Texas

Bush Excluded By Latin Summit As China,
Russia Loom -- Bloomberg

Dec. 15 (Bloomberg) -- Latin American and Caribbean leaders gathering in Brazil tomorrow will mark a historic occasion: a region-wide summit that excludes the United States.

Almost two centuries after President James Monroe declared Latin America a U.S. sphere of influence, the region is breaking away. From socialist-leaning Venezuela to market-friendly Brazil, governments are expanding military, economic and diplomatic ties with potential U.S. adversaries such as China, Russia and Iran.

“Monroe certainly would be rolling over in his grave,” says Julia Sweig, director of the Latin America program at the Council of Foreign Relations in Washington and author of the 2006 book “Friendly Fire: Losing Friends and Making Enemies in the Anti-American Century.”

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My Comment: A sign of the times .... being the regional superpower is not what it once use to be. Hmmmm ..... I guess there is some truth to the story of globalization.

Latin America Preparing For Tougher Times

From The Economist:

There is much that governments can do to protect recent social gains—but they will need outside help.

IT WAS great while it lasted. In the five years from 2004 Latin America’s economies grew at an annual average rate of over 5%, inflation remained generally low, credit expanded and exports boomed. All this meant that the proportion of people living in poverty fell from 44% in 2002 to 33% this year, according to an estimate this week by the United Nations Economic Commission for Latin America and the Caribbean. Now the task facing the region’s policymakers is to limit the damage as the world economy deflates.

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