Trading standards

As Iran journeys back from isolation, Asian nations stand ready to engage

When Iran was welcomed cautiously back into the international fold in January, some were expecting a flood of suitors in front of Tehran’s door, while others thought the path back from exile might be a bit stop-start.

And while there have been business deals with some Western nations, such as France signing off an order for Airbus aircraft, it has been Asian nations that have been best-placed to improve, restore and underline trade agreements and mutual policies between themselves and the Islamic Republic.

Today, Tehran confirmed it had seen a 13% increase in oil exports to Asia, off the back of its energy market unshackling.

India and South Korea led the way in Iranian imports, picking up the slack after drops in crude purchases for China and Japan.

But even before international sanctions were relaxed earlier in the year, those four Asian countries mentioned above maintained their oil imports from Iran.

India, most of all, is brimming with infrastructure companies licking their lips at the chance to get involved in the re-opening Iran.

Its tech firms and place as the world’s biggest open-market democracy give it a unique position in the region.

And it has just announced annual growth for 2015/16 of 7.6%, outstripping the other so-called BRIC nations of Brazil, China and Russia and underlining its growing economic strength.

So with continued upward GDP expansion and the unbuttoning of business regulation in India, coupled with a change of policy towards Iran, has seen the 2014 Narendra Modi administration embed itself firmly with an old trading partner that is now seen by others in the world in a fresh light.

The times they are a-changin’

So when policies change or when governments are voted out and replaced, it is not just that specific country which sees the results internally. A new president or a lessening of sanctions can breathe new life into dusty agreements or encourage fresh engagement from different actors pursuing new angles.

Across the other side of the Pacific Ocean, the ongoing fade of the ‘pink left’ governments in Latin America has sparked possible new directions when it comes to trade.

The nascent, business-friendly presidential administration of Mauricio Macri in Argentina has been making tentative steps as an observer within the Pacific Alliance – a group of four Latin nations that is based on free-trade.

Argentina may not be a Pacific Rim country but it shows the fluidity of blocs and the alternating  popularity of regional partnerships when it comes to a change of government.

Under previous leader Cristina Fernández, protectionism was the bedrock for Argentinian trade and she called as her acolytes fellow leftists in Brazil, Venezuela, Ecuador and Bolivia.

Now the new leader wants to move his country in his preferred direction and that seems to be by nudging up to Mexico, Colombia, Peru and Chile’s integrated club.


Corbynmanía – a Latin flavour to Labour

Argentina calls the radical new leader of the UK opposition “one of ours”

The rapid rise of Jeremy Corbyn and his leftist acolytes in the British Labour Party has been met with mixed responses in the UK but a thumbs-up in Latin America.

For the governing Conservatives, there was early gloating over a man deemed originally to be ‘un-electable’ but this has been replaced by worried, cautionary rhetoric.

In the Labour ranks, there has been elation, bemusement, uncertainty and angst.

Some of the loudest cheers of approval have come from thousands of miles away.

For Argentina, the election of Jeremy Corbyn is a decisive and positive move in support of a man whose politics resonate deeply with many people across the country and, indeed, throughout Latin America.

Corbyn has pursued justice for the victims of the Pinochet dictatorship in Chile.

He has led a UK parliamentary mission to the leftist Bolivia of Evo Morales.

He is blood brother to trade unions and a thorn in the side of ‘savage capitalists’.

He supports debt renegotiation and nuclear disarmament.

And the Latin links do not just exist on a political level: his second wife was Chilean and his current partner is from Mexico.

Finally, just this afternoon, on Tuesday 15 September, while he was addressing the British Trades Union Congress, he stood up for the rights of organised workers in Colombia, a notable right-leaning and Washington-minded Latin state.

Most tellingly for Buenos Aires, he is an anti-imperialist pacifist, in the true oratorical mould of Hugo Chávez, Evo Morales or Cristina Fernández and he opposed the 1982 Falklands War, arguing for a peaceful resolution to the dispute.

The current British government is intransigent.

It says it believes in the Falkland Islanders’ right to self-determination as underlined by their decision to maintain their status as a British Overseas Territory (and thus British nationality) in a 2013 referendum.

Case closed.

Or maybe not?

With the election of Jeremy Corbyn as Labour leader, Buenos Aires sees it as very much open.

In an interview with the Pagina 12 newspaper on 14 September, the Argentinian ambassador to the United Kingdom, Alicia Castro, said she feels “joy, a great satisfaction” after Corbyn’s victory in the leadership contest.

She lauded his “emphatic show of solidarity with Argentina”, even going on to claim that “he is one of ours”.

Corbyn certainly has not followed the majority of his compatriots on the Falklands/Malvinas issue.

He is a member of the European Pro-Dialogue pressure group and in March this year questioned the increase in military spending in the Falklands by the UK government. (This blog reported on that at the time.)

In her interview, the ambassador went on: “his leadership can decisively guide British public opinion in favour of dialogue between the two governments”.

The swelling wave of socialist pride and power carrying Mr Corbyn at the moment certainly seems to have a momentum to it that comes from leftist Latin seas far from these shores.

A las urnas…

Eight Latin American countries go to the polls next year – what can we expect?

First up across the region are Costa Rica and El Salvador, where there will be legislative and presidential elections on 2 February. The Costa Rican president, Laura Chinchilla, is constitutionally barred from running for consecutive terms. So although the number of female leaders across the region has risen to four recently with the re-election of Michelle Bachelet in Chile, it will soon drop back down to three as Chinchilla leaves office (Dilma Rousseff in Brazil and Cristina Fernandez in Argentina are the other two women leaders). In fact, although it is unlikely, the number could be down to two by the autumn – as Brazilians go to the polls in October. Back in San José, no one candidate is storming the race, meaning that the country could need a run-off to split the field, an electoral practice that is common in Latin America but that has not taken place in Costa Rica since 2002. Johnny Araya of the National Liberation party and Broad Front’s José Villalta look to be the strongest of the candidates so far.

El Salvador is another country that prohibits presidents running again straightaway and, as such, Mauricio Funes will be stepping down this spring. The leading contenders to take his place go head-to-head on 2 February, with a run-off scheduled for 9 March if needed. It is the smallest country in Latin America and much of the new president’s focus will be on gang violence, which has been increasing recently despite a truce between the criminals in 2012.

Next up is Colombia, which has elections to both houses of parliament on that Sunday 9 March. Nearly three months after that, on 25 May, is the race for the hot-seat as the presidential candidates face the public. Incumbent Juan Manuel Santos is going once more and it looks as though he will follow his one-time mentor, ex-leader Álvaro Uribe, in securing consecutive terms in office. Peace talks with the Farc rebels are currently taking place and Santos has said that 2014 will be a crucial year for peace – he feels that it is his national duty to see the talks through to ‘the end’. He has so far wavered between moderation and muscle: at once trying to maintain the talks without completing retreating from the hardlines drawn up by Uribe during his two terms in office – ten more militants were killed in a bombing raid just after Christmas.

But in Panama there is no chance of seeing the same face again as Ricardo Martinelli is leaving office. On 4 May the isthmus nation is due to hold legislative ballots to its one National Assembly as well as the ballot for the head of state.

The Dominican Republic has a vote for the chamber of deputies and the senate the week after, on 16 May. Only legislators are on the ballot papers in 2014 because Danilo Medina was voted into the presidency in 2012 for a four-year term.

Evo Morales, the charismatic Bolivian president, is seeking a controversial re-election next year on 5 October. Technically, Evo has served two terms in office – the maximum that a politician can reach in the Andean nation. But because his first term (2006-9) predated the constitution that was re-written in 2009, the courts ruled that his time limit re-started under the new legal framework in 2009, rather than in 2006. As such, he is free to run again next autumn. Another victory and a full term in office would take his reign in the mountains up to 2019, which at 13 years would be almost as long as Hugo Chávez served in Venezuela. Evo’s time in office so far has been celebrated and criticised and has swung from a defence of coca farmers, to facing protests over subsidy cuts and road-building plans, to a cosy familiarity with other leftist countries, such as Venezuela and Ecuador.

Brazilians head to the polls on the same day in October, also for a general election. The country has been a regular in the world news this year, from widespread and – at times – violent protests against poor public services, to the visit of Pope Francis, and the excitement about and criticism of the upcoming World Cup. The festival of football happens thee months before the election and although the soccer-mad nation would love to see a sixth victory for a seleção there have also been the calls for the money to have been spent elsewhere in the economy. Dilma has continued with the Workers’ Party’s statism but has not had quite the popularity that her predecessor Luíz Inácio ‘Lula’ da Silva enjoyed. That said, her recent poll showings have improved from over the summer of civil discord and should be strong enough to see off her efficient main challengers, Aécio Neves of the Social Democratic Party and the Socialists’ Eduardo Campos.

Uruguay is the last of the Latin American countries to vote in 2014, with a general election on 26 October. The little South Atlantic nation has been making headlines of its own this year, with a ground-breaking legalisation of marijuana and same-sex marriage. Its football team stands a good chance of doing well at the World Cup, with several tremendous players blooming right now. Its outgoing leader, José Mújica, has won widespread acclaim for his low-key presidency, as he eschews many of the presidential trimmings and stylings by driving himself in slacks and jackets to work from his small farmstead and flying economy class. And much of this contributed to Uruguay being the inaugural winner of The Economist‘s ‘Country of the Year’ award. Whoever takes up the mantle in Montevideo will certainly have interesting shoes to fill.

Feliz Año!

MEXICO ELECTION XIV – Students on the march

Mexicans appear to have returned the PRI to power in general elections. This blog is covering the results live from inside the country

On Monday 2 July, the day after the former autocratic political behemoth, the Institutional Revolutionary Party, was seemingly put back into power in Mexico (many vote recounts have started after “irregularities” were found), thousands of members of the #YoSoy132 protest movement massed just off Mexico City’s grand Paseo de la Reforma boulevard ahead of a march against the election results, in particular the voting in of Enrique Peña Nieto to the presidency.

Alert! Alert! Watch what is coming: the student fight for Latin America

Mexico without the PRI, Mexico without the PRI

Supporters of the #YoSoy132 movement give their thoughts

Time to retake the Latin exam

The British government shows some determination to address its lack of commitment to Latin America

They say Latin is a dead language. Sometimes it seems that many in different British governments have believed Latin America is dead too. The visit of the British Minister for Latin America to Bolivia from 26-27 July went almost unnoticed in the UK press. The BBC had one online page of coverage of the trip; a YouTube video Jeremy Browne, the Liberal Democrat MP with responsibility for Latin America, put online had only been viewed 42 times by the time this blog was published.

In November, the Foreign Secretary made this speech about the relationship between the UK and Latin America. He was right that Britons have played a role in forging Brazilian and Uruguayan independence and being the first European nation to recognise Mexico. Welshmen took football to Argentina. Cornishmen helped develop the Mexican silver mines.

But it seems that there has been an invisible colonial barrier barring the UK from closer relations with the region; a whispered admission that this was Spain and Portugal’s domain. Africa and the sub-continent have received far greater attention from the UK, mainly owing to the colonial links. Millions across India, Pakistan and sub-Saharan Africa speak English. Charities and aid workers regularly channel their efforts (rightfully) on the many social, political and medical needs of these nations but Latin America also needs support. And the UK can help the region in a different way.

It need not abandon Uganda or Bangladesh but the old colonial frontiers that stood are long gone. New-age imperialism is booming. China has already muscled in on the old UK ground: Beijing is a massive investor in many African countries now, often exchanging construction workers and architects for coal. India is turning into a global power capable of looking after itself. South Africa has now joined Brazil, Russia, India and China in their strong, emerging-powers BRICS bloc.

Latin America is full of successful, healthy and democratic countries. Mexico, Argentina and Brazil are in the G20. The region does not need stabilising support but it would welcome closer trade and investment links. As Mr Hague noted in his speech “We export over three times more to Ireland than we do to the whole of Latin America”. That needs addressing fast. China is becoming the dominant power in Africa. As Brazil outgrows Latin America and sets its sights on global ambitions, the UK would do worse then re-focusing a little of its ring-fenced international development budget and a lot of its trade desires on Latin America.

A fortress made of BRICS

The BRICS countries are building a formidable global power base but there are still cracks in the foundations

With the addition of South Africa to the group late last year, the emerging markets bloc has expanded its reach and capability considerably. It now has fingers in pies cooking in all corners of the globe and each member-state has a rough home ‘region’ where it is the dominate force. Brazil has majority sway over Latin American affairs, China rules the construction industry in Africa and Russia has diplomatic and industrial control throughout the former Soviet Union nations. But the way they influence and react with each other – let alone other countries – is both a cause for celebration and concern.

China is the most successful of the BRICS. It competes with Brazil in Latin America and rivals South Africa throughout Africa, be it through construction contracts in Angola or oil agreements in Sudan. Its conveyor lines drive European businesses back home and its markets are being opened up to foreign firms. It is powerful militarily, diplomatically and economically. China also is skilled at both comforting and irritating rival BRICS. It is happy to let South Africa be a diplomatic voice for Africa while it maintains its industrial strength there. But it has annoyed India by cosying up to Pakistan recently with economic agreements and plans for motorways and railways between the two countries. The transport links would pass through a part of Kashmir that India sees as its own and that Islamabad ceded to Beijing in 1963.

The other powers have also tried to carve out distinct paths across the globe. Brazil is promoting itself as a leader of a new international diplomacy by flexing its negotiation muscles and by engaging with Iran and the Middle East. Russia is still sending rockets to the International Space Station and is arguably the closest of the BRICS to Europe. India is starting to move its weight in South East Asia and has belatedly broken free from its comfortable domestic engine room to engage with African nations and make its nuclear-backed voice heard. South Africa is aiming to make the continent it foots its own, at first through diplomacy (President Jacob Zuma recently met Colonel Gaddafi for talks), and later by possibly challenging China industrially.

There are many sticking points. China and India have a disputed border and Beijing is cross that Delhi lets the Dalai Lama use India as his base-in-exile. Diplomatically, Brazil and South Africa are making an impact on the world stage, while quietly letting China continue to invest in their ‘home’ regions. But while China powers on, Russia is stalling and South Africa relatively inexperienced as the baby of the club.

It is up to Brazil and India to move the BRICS on from a second-class talking-shop to the most important international alliance. An Argentine writing his doctorate on Argentina and Brazil’s economies recently told me that “Brazil is big, very big – too big in fact” and the same could be said for India. They are outgrowing their respective Latin American and sub-continental origins and it is time that they give China a rest from pace-setting. They are certainly all building themselves up quickly and strongly and the West ignores them at its peril.

Hotting up on the Equator

Equatorial Guinea is one of the smallest countries in Africa but it has large, and questionable, ambitions.

Last week, this blog looked at the friendships and enmities between different Latin American countries and Colonel Gaddafi, (see ‘An Arab and his amigos‘– 05/04/11) but could help be on hand for Gaddafi from another Spanish-speaking source?

The tiny country of Equatorial Guinea sits snugly in the central western corner of Africa. The current head-of-state, Teodoro Obiang Nguema, came to power after deposing his uncle in a coup and then sentencing him to death by firing squad.

Gaddafi also came to prominence after overthrowing the establishment and there certainly seem to be many similarities between Equatorial Guinea and Libya:

1) Longevity of leaders

Teodoro Obiang Nguema has been the president since 1979; Gaddafi since 1969.

2) Political parties

Although a couple of opposition parties have been officially ‘legalised’ in Equatorial Guinea, they have only won a handful of seats during Obiang’s three decades of power. Gaddafi has long proclaimed that he is just a revolutionary leader, not a president, and there has been no formal government, let alone functional opposition, in Libya during those 41 years in power.

3) Protest marches demanding social and political reform

Any attempt by Equatoguinean opposition movements (Popular Union, Convergence for Social Democracy, Progressive Democratic Alliance) to show their united condemnation of the repressive regime is stamped out quickly. All reporting of the uprisings in North Africa and the Middle East is banned. All protests are quashed by the police. Juan Tomas Avila Laurel is a writer from Equatorial Guinea and he went on a hunger strike in February calling for democratic and social reform and in protest at the corruption, malpractice and maltreatment of which he accuses President Obiang’s government. He had to flee to Spain soon after he started his fast. The current situation in Libya shows why leaders such as Obiang fear the consequences (civil war, foreign intervention) of mass demonstrations.

4) Oil

Equatorial Guinea has huge reserves and its wealth is rocketing, with a GDP far in excess of its neighbours, although it seems that the cash is simply heading straight into the government’s bank account. However, the situation is changing in Libya, where most of the oil is now in rebel-held land.

5) African Union

Obiang is the present Chair of the AU and has used his position to support the Gaddafi regime. Last month, Obiang praised what he called Gaddafi’s ‘readiness’ for ‘political reforms.’ He also ensured that the AU denounced ‘any form of foreign military intervention’ including a no-fly zone. Gaddafi was head of the AU in 2009-10.

As we have seen with Ivory Coast, (Jose dos Santos of Angola, another repressive, long-term president, sending aid to condemned Laurent Gbagbo), the strongmen club of Africa starts to worry when one of their own is in trouble and has no shame in letting it be known where their loyalties lie. Obiang is leader of the AU at the moment and cannot demonstrate worthy, multi-national leadership unless he shows a willingness to sort out his own, impoverished country first.

An Arab and his amigos

Colonel Gaddafi appears to be increasingly isolated. Will he look to his Latin friends for an exit route?

William Hague, the British Foreign Secretary, suggested (erroneously) back in February that Muammar Gaddafi had fled Libya and sought refuge with the friendly face of Hugo Chavez, the Venezuelan president – a claim which Caracas criticised heavily. However, that idea was not a whimsical prospect dreamt up by Mr Hague at random – Mr Chavez has made it a habit of his to befriend states with clear anti-US rhetoric and ideals, such as Iran and Cuba. Libya has been no exception and in 2009, Gaddafi named a football stadium after the Venezuelan premier (only for rebels to rescind the honour a few weeks ago). (Football seems to be a peculiar source of mutual content for states which take pleasure in upsetting the US.)

Now Colonel Gaddafi is losing support in the Maghreb and in his own cabinet , can he look west across the Atlantic for help? Chavez has derided the ‘no-fly-zone’, calling it ‘total madness’ and his thoughts have been echoed by many across Latin America.

Brazil abstained from voting on the UN Security Council’s Resolution 1973, the document which gave the allies their international legal permission to crackdown on Gaddafi’s forces. Evo Morales, the Bolivian president, did not agreed with the UN’s decision and announced his ”condemnation, repudiation and rejection” of the intervention.

Similar noises were made by Nicaragua, where Daniel Ortega, a constant thorn in the side of the West, criticised the UN for turning itself into ”an instrument of warmongering and death for these powers”. Fidel Castro accused NATO of ”demonstrating the waste and chaos that capitalism perpetuates” and the President of Uruguay, Jose Mujica, although ‘lamenting’ the attacks by Gaddafi, pointed out that ”saving lives with bombs is an inexplicable contradiction in terms”. Argentina, Ecuador and Paraguay also came out against Resolution 1973.

But there were some resolute stances from the Latin Americans in favour of the allied action. Mexico, Peru, Chile and El Salvador all came out in favour of the Security Council’s decision. Colombia said that the Gaddafi regime had ”made fun of” the resolution and President Santos called for an end to the fighting.

So Gaddafi seemingly has a few open doors in Latin America. Whether he will choose to walk through them remains, at this stage in the crisis, very hard to predict. However, public opinion can be fickle in Latin America and presidents are always on the hunt for high approval ratings – giving the Colonel some free bed and board might not go down too well. So as this situation develops, despite their previous announcements, it is not a given that the Latin capitals will continue to be so welcoming to the dictator.

Time for a Latin lesson

Despite the disaster in Japan and the alternative power sources, dozens of countries have an unstoppable thirst for nuclear power. They should have a look at what is going on in Latin America and the Caribbean.

70% of the electricity that Latin America and the Caribbean region use comes from renewable energy sources, according to a report published last week by the Inter-american Development Bank (BID). The BID has ploughed millions of dollars into energy development projects across the regions in the last decade or so, and the results have been admirable.

Arnaldo Vieira de Carvalho, an energy specialist at the BID, said that, after the conferral of the loans:

“The only obligation that they [national governments] have with us is to work in two areas: on the generation of renewable energy and on climate change. These are long-term loans for more than 30 years, and this gives them more freedom for their work.”

After what happened in Japan, Germany, (which has 17 reactors on the go at the moment), announced an immediate review of its nuclear programme. The UK and Indian governments (19 and 20 reactors respectively) both asked for safety reviews. Even China (13 reactors) postponed the approval of any more for the time being. It has plans lined up for an astonishing 160 new reactors.

But the desire for nuclear energy is weak in Latin America and the Caribbean, where there are only six reactors in total (Argentina, Brazil and Mexico have two each). The three major players in the region are leading the way in their renewable ambitions and the BID is excited about what has been achieved so far from its support. According to Vieira de Carvalho, the renewable energy output of Brazil and Costa Rica is more than three times the global average.

What is also pleasing is that others seem keen to follow. Nicaragua, dotted with volcanoes, has just secured a $30.3 million loan to overhaul a geothermal energy plant in the west of the country.

According to the Financial Times, coal and gas make up 62.2% of the annual global energy consumption, whilst nuclear (13.5%) lags behind hydroelectric (15.9). And although more than 20 countries have more than 400 new reactors in the pipeline, none of them are in Latin America or the Caribbean, where nuclear power is used sparingly. There the plans are very much for a greener, cleaner future.

All drugged up

Evo Morales, the Bolivian president, is not best pleased with the US at the moment. He has accused the States of ‘attempted defamation’ during his ongoing battle with Washington to save his country’s beloved coca from renewed international prohibition.

Evo Morales, President of Bolivia, chewing a coca leaf at at UN Convention (from 0:50)

Source: unitednations, YouTube, 16/03/11

What has rankled with Mr Morales is criticism of the way his government is tackling drug production. He believes the US wants to destabilise him by linking his administration to drug traffickers. But there is no smoke without fire. Last week, Rene Sanabria, Bolivia’s anti-drugs chief was arrested in Panama on charges of running a cocaine-smuggling gang at the same time as heading an 15-person anti-narcotics intelligence unit for Mr Morales.

Whilst this was a frustrating setback for Evo, he needs to cool his temper if he is to achieve an end to the global moratorium on coca leaves, in place since it was condemned by the UN in its 1961 Convention on Narcotic Drugs.

Coca has been chewed for thousands of years across Bolivia and also in the highlands of Peru to combat altitude sickness, or soroche, along with other ailments and also for recreational purposes. Morales himself had a chew at a UN Drugs Convention in Vienna in 2009 (see video above).

It is a traditional pastime but a hobby that does involve the mastication of the rawest form of cocaine. And this is where the US gets nervous.

Washington wants to sort out cocaine production, the heartlands of which are in Bolivia. If it hits the war on drugs from inception point, it can get a grip on the other parts of the chain, notably Mexican trafficking and US domestic demand. But it is not convinced that Mr Morales is doing enough to cut cocaine farming. And these current problems will probably have kept La Paz off US President Obama’s schedule during his present trip to Latin America, which comes to an end on Wednesday 23 March.

Last week, the UN International Narcotics Control Board criticised the Morales government for allowing Bolivia’s coca crop to increase to 119 square miles, the largest amount of land dedicated to coca cultivation for 13 years.

But Morales maintains that he too wants to stop cocaine production and the close links to coca farming mean the line between the two is often blurred. Morales is angered by what he sees as the US-sponsored embargo of his cultural heritage and he knows that his firebrand socialism, which reaches out to Iran and Cuba, is a thorn in the side of the US.