The Latin American Report # 26


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Original Source (Edited with Canva)

Hello, hivers. This is the 26th edition of The Latin American Report, an effort tracking sound political and economic news around the region. Today we focus a bit on México, Ecuador, and Argentina, with some quicks ending the report to be well updated. Let me jump on the report now.

México

If you ask me, when Andrés Manuel López Obrador assumed the presidency of his country, he arrived to lead a sort of failed state in terms of public security, a category that today we could distribute over a great part of the region. One of the goals I pursue with this project is to leave "recorded" in the immutable blockchain the political, social, and economic performance of Latin America in these times so that anyone can go to it and find trends. With what I have raised so far, there is enough material to realize cancer that the scourge of criminal gangs and drug trafficking —with its burden of violence on the backs of the people— represents for our societies.


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Imagen de Mizter_X94 en Pixabay

In countries such as Mexico, Ecuador, Colombia, Honduras, El Salvador, and Guatemala, the authorities have been unable for years to effectively contain the impact of the violence emanating from the activity of these gangs, which even become famous claiming zones where they reign, in a sign of precisely that governmental incapacity. If it is not as we say, how is it that comes to be seen as a "normal" event that groups of migrants end up being kidnapped in Mexico to be extorted by criminals, who price their lives at $1,500 per head?

El presidente @lopezobrador_ informó que hay un despliegue de la @GN_MEXICO_ en la zona de Matehuala, San Luis Potosí, para rescatar a migrantes secuestrados que viajaban en un autobús y cuyo número se calcula en 50.

El mandatario detalló que en dicha región hay bandas que se… pic.twitter.com/K5wpG4Pu0X

— Gobierno de México (@GobiernoMX) May 17, 2023

Well, we learned yesterday that Mexican soldiers have found 49 Latin Americans —in transit heading north— who had been kidnapped last Tuesday when they were traveling in a bus, including 11 children. The kidnappers had not yet been found —a relevant fact, because we are not talking about a "spectacular" rescue, but about law enforcement agents "meeting" the migrants— and neither had the drivers, who as a rule can either be killed or collude with the criminals.



Some of the rescued migrants (Source).

Finance

Cloning the dynamics of the dollar when the Fed pronounces in favor or against raising interest rates (on the immediate future in this particular case, read here), the Mexican peso has been trading with losses since Tuesday, after learning that the banking authority will put a prolonged pause in the monetary tightening cycle that dates back to June 2021. The stock market, on the other hand, finished higher amid good feelings about the talks on the US debt ceiling, which have kept the market on edge in recent days. The S&P/BMV IPC index, which concentrates on the performance of the country's most liquid companies, advanced 0.36%.

Ecuador

Finally, Guillermo Lasso ended up activating the "crossfire" clause, where the figure of the president is simplified with the Congress to demand the call for early elections. Reading the "small print" of the Constitution, I believe that the opposition, which had Lasso cornered in the legislative instance, has a point because it does not seem to explain well the legal argument from the state of "national commotion".


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Guillermo Lasso, President of Ecuador (Source).

The Constitutional Court rejected late on Thursday a total of six appeals that tried to revert the presidential decree, thus making the Executive's decision firm. Personally, I am not a big fan of presidential systems in which the president, whatever the circumstances, can dissolve Congress.

It is too great a power in the hands of one person, even if he was directly voted by the people; it is a matter of design. There is no clarity as to where the current scenario may lead, so it will be necessary to closely follow developments in the days and weeks to come (early elections are due in August, and a runoff election in October if necessary). In the meantime, Lasso will govern by decrees that must be validated by the aforementioned Constitutional Court.


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Protests in Quito last Wednesday (Source).

Argentina

A report of the Argentine General Audit criticized the management of the Government of Mauricio Macri when it requested 2018 a historic loan of 56,000 million dollars from the IMF, as it is now exposed without conducting analyses on costs and financial risks or sustainability and solvency. In addition, it was denounced that it was not discussed in the Legislative nor did it follow the procedures established by law.


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Christine Lagarde and Mauricio Maci back in 2018 (Source).

The Argentine government, supported to some extent by Washington, renegotiated the agreement last year and has managed to change fiscal and monetary targets in recent weeks in response to the major crisis caused by a fierce drought, which has impacted export capacity to put more pressure on a chronic shortage of foreign currency. All this is happening in a context of unstoppable inflation that is already at 100%, which has resulted in more and more Argentines being dragged into poverty, those this year going to the polls to decide the continuity of a Peronism somehow consumed in internal struggles.

Más que una deuda, es un delito.

El informe de la Auditoría General de la Nación demuestra que el préstamo del FMI tomado por Macri ha violado la ley argentina y debe ser investigado con todo el peso de la Justicia.

— Alberto Fernández (@alferdez) May 18, 2023

Regional quicks

  • Dominicans received US$ 3.3 billion in remittances in the first four months of the year, reaffirming this source of income as the second largest in the country behind only tourism. The majority came from the United States, but remittances are also received from Spain —the second provider in correspondence with the number of Dominicans who have settled there—, and to a lesser extent from Italy and even Haiti.

  • On Wednesday, the 8-year-old Panamanian girl Anadith Tanay Reyes Alvarez, of Honduran parents, died in the custody of the U.S. Border Patrol. The minor and her relatives were being held in Texas, specifically in one of the areas where many migrants usually cross. The girl, who was born with heart problems and had undergone surgery in 2020 in Panama, demanded emergency medical attention but died once she was transferred to the nearest hospital.

  • Judicial authorities in Puerto Rico brought charges against 44 individuals who allegedly embezzled more than $1 million in funds that were originally intended to address Covid-19. It is good to know that individuals who did not think twice about taking resources from people and businesses with more immediate needs —to finance a higher lifestyle— will now face the full force of justice, but it is frightening to know at the same time how easy it was for them to hoard so much money by falsifying tax returns, payrolls, bank balances or identity cells.

  • And Joe Biden's administration assured the UN that it will protect from Venezuelan debt creditors a fund of 3 billion dollars which, administered by that organization, will be used to alleviate the tense humanitarian situation in that country. The crisis comes as a result of its own policies but also of US sanctions which have limited the availability of foreign currency and other sovereign assets. There is consensus even from the opposition to move forward with this agreement. Some fear was in the air that Venezuelan debt creditors would seize this fund to satisfy their demands.

And this is all for our twenty-sixth report. I have referenced the sources dynamically in the text, and remember you can learn how and where to follow the LATAM trail news by reading my work here. Have a nice day.



Edited with Canva.



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