All posts tagged Trade

Haiti and Dominican Republic: No Détente in Sight

By Emma Fawcett*

Resettlement camp at Corail Cesselesse, Haiti Photo Credit: Oxfam International / Flickr / Creative Commons

Resettlement camp at Corail Cesselesse, Haiti Photo Credit: Oxfam International / Flickr / Creative Commons

Tensions stemming from the Dominican Republic’s forced repatriation of Haitians are spilling over into other aspects of the traditionally problematic relations between the two countries, with little prospect of resolution.  Over the summer, the Dominican Republic began a forced repatriation process for Haitians who did not comply with its 2014 National Plan for the Regularization of Foreigners.  After a temporary suspension prompted by international outrage, deportations resumed on August 15 at a rate of 50 to 100 per day, and the International Organization for Migration reports that many more Haitians are “spontaneously returning.”  Of the half million previously found to be without residency permits, about 288,000 people registered for the regularization process –180,000 of whom were rejected and are likely to be repatriated.  According to Amnesty International, 27 percent of those who have left voluntarily say they were born in the Dominican Republic, but they fear arrest or harassment because they lack proper documentation.  At least four camps filled with recent deportees have sprung up on the Haitian side of the border, and the United Nations Human Rights Council has warned that conditions are abysmal and sanitation facilities inadequate.  The Haitian government has promised to assist in resettlement efforts, but there has been no coordinated response.  At the Tête à l’Eau camp, the government initially provided $30 in assistance to deportees, but ran out of funds.

In retaliation, Haiti on October 1 began enforcing a ban on the overland importation of 23 Dominican goods, including wheat flour, cooking oil, and soap.  These products must now enter by boat or plane to Port-au-Prince or Cap Haïtien.  Smugglers found in violation of the new regulation will have their goods confiscated.  Originally announced a year ago as a way of increasing customs revenue and reducing smuggling, the measure is expected to cause prices for staples to increase by up to 40 percent in Haiti and will cost the Dominican Republic $500 million in trade revenue.  A Dominican Chamber of Commerce official noted that the measure “violates norms of free bilateral commerce and international agreements.”  Market women who run much of Haiti’s informal economy by acquiring goods across the border and bringing them home to sell have already faced difficulties since the Dominican immigration crackdown began, and the trade ban poses a further threat to their livelihoods and those of their customers.  The Association of Haitian Industry (ADIH) hopes that the measure will improve demand for domestic products.  The Dominican government and businesses have argued that trade and migration issues should remain separate matters.

The new, slower pace of deportations has allowed the Dominican government to continue with their original strategy while avoiding further media attention and threats to their tourism industry.  Ongoing presidential campaigns in both countries – with Haiti’s elections on October 25 and Dominican President Medina seeking reelection next May – have made the antagonism politically useful for both.  However, the heaviest costs, including deportations, resettlement in makeshift camps, and potentially dramatic increases in food prices, are, as usual, borne by Haiti’s poorest.  A recent World Bank report on Haiti noted that “a social contract is missing between the State and its citizens,” and the Haitian government’s inability to provide for returnees and short-sighted trade policy is clear evidence of that.  The international community – the OAS in particular – has made serious missteps in its efforts to encourage bilateral talks, including a call for dialogue by OAS Secretary General Luis Almagro that was misinterpreted as a call for the unification of Hispaniola.  In response, the Dominican press has doubled down on its inflammatory rhetoric.  Neither side sees advantage to ending the stalemate, at least until after the Haitian electoral process has concluded. 

October 6, 2015

*Emma Fawcett is a PhD candidate in International Relations at American University.  Her doctoral thesis focuses on the political economy of tourism and development in four Caribbean case studies: Haiti, Dominican Republic, Cuba, and the Mexican Caribbean.

 

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by clalsstaff on October 6, 2015  •  Permalink
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Posted by clalsstaff on October 6, 2015

https://aulablog.net/2015/10/06/haiti-and-dominican-republic-no-detente-in-sight/

Trans-Pacific Partnership: A Political Step Forward

By Fulton Armstrong

In more than 10 cities across the U.S. activists will use guerrilla light projection to illuminate monuments and building facades with slogans like “Don't Let Comcast Choke Your Freedom,” “No Slow Lanes, Open & Equal Internet For All,” and “TPP Dismantles Democracy.

In more than 10 cities across the U.S. activists used guerrilla light projection to illuminate monuments and building facades with slogans like “Don’t Let Comcast Choke Your Freedom,” “No Slow Lanes, Open & Equal Internet For All,” and “TPP Dismantles Democracy.” Photo Credit: Backbone Campaign / Flickr / Creative Commons

The chairmen of key U.S. Congressional committees agreed on legislation allowing President Obama to negotiate a Trans-Pacific Partnership (TPP) trade accord, but major political and substantive obstacles to an agreement remain. The leaders of the Senate and House tax-writing committees announced the move, with the key Democratic senator involved claiming that the Obama Administration had addressed his deep concerns about the secrecy of the talks. If passed, their bill would give the President “fast-track” trade authority – power to negotiate an accord that the Senate would eventually vote on but without the power to amend it, which would significantly increase chances of passage. Obama’s advisors have called TPP the “cornerstone” of his Asia policy, and the President said last week that it would help “make sure that we, and not countries like China, are writing the rules for the global economy.” Supporters estimate that TPP would stimulate growth by eliminating tariffs and non-tariff barriers affecting $2 trillion of goods and services (about one-third of global trade) each year among its 12 members.*

Opposition in the U.S. Congress and elsewhere remains intense, however. The Senate Democratic whip, charged with tallying support and opposition, stated that only one-quarter of Senate Democrats support the measure – and those opponents have made clear their concerns about the implications for U.S. workers and consumers. Although tariffs are on the table, most observers say the focus of the negotiations is on “harmonizing” regulations, which big multinational corporations – which have access to the talks that citizens’ groups lack – systematically seek to eliminate. Pharmaceutical companies, for example, are pushing hard for extending patents and trademarks so that cheaper generic medications cannot be sold. Critics say revisions to copyright and trademark provisions would also have implications for public information and the internet. Industry is seeking to roll back environmental protections in place since the early 1970s. The negotiations have been secret, but a leaked chapter of the draft agreement revealed that companies were gaining the right to sue governments if any regulatory action ever caused their profits to fall short of target – a massive burden on budgets.

The lack of transparency, which the leading Senate Democrat claims has been addressed, may have stoked opponents’ concerns. But the differences between U.S. backers and opponents appear significant and unlikely to fade without some serious political horse-trading, which the Obama Administration has been unwilling to do. In his statement last week, Obama admitted that “it’s no secret that past trade deals haven’t always lived up to their promise” – particularly regarding job creation – but neither he nor the Congressional chairmen have provided hard data showing that dismantling a host of regulations to accommodate corporate agendas will help consumers and un- or under-employed U.S. workers. If history is any guide, the Latin American signatories – Mexico, Chile and Peru – may see a favorable impact regarding employment in certain sectors, and others may see it as the only game in trade right now and thus worth trying to join, but Washington’s vision of TPP as primarily an Asia policy – to counter Chinese influence – suggests that they too see the advantages of participation accruing across the Pacific rather than to the north.

* Currently envisioned as members are the United States, Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam: Korea last week expressed interest in joining the talks, but the United States told it to wait. Colombia is interested, and Panama and Costa Rica seek membership in the “Pacific Alliance,” which is related to TPP.

April 20, 2015

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by clalsstaff on April 20, 2015  •  Permalink
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Posted by clalsstaff on April 20, 2015

https://aulablog.net/2015/04/20/trans-pacific-partnership-a-political-step-forward/

Bracing for Economic Pain in Brazil and Beyond

By Kevin P. Gallagher*

Brazilian Real

Mark Hillary / Flickr / Creative Commons

Brazilian President Dilma Rousseff’s warning to U.S. Fed Chairman Ben Bernanke in 2012 – that his monetary-easing policies were creating a harmful tsunami of financial flows to emerging markets – was spot-on.  U.S. growth and interest rates have been appreciating currencies, causing asset bubbles, and exporting financial instability to the developing world.  Brazil and other emerging-market countries may soon be facing capital flight and exchange rate depreciation that could lead to financial instability and weak growth for years to come.  From 2009 to 2013 countries like Brazil, South Korea, Chile, Colombia, Indonesia and Taiwan all had wide interest rate differentials with the U.S. and experienced massive surges of capital flows.  The differential between Brazil and the U.S. was more than 10 percentage points for a while.  According to the latest estimates by the Bank for International Settlements (BIS), emerging markets now hold a staggering $2.6 trillion in international debt securities and $3.1 trillion in cross-border loans – the majority in dollars.

Now the tides are turning.  Many emerging market growth forecasts are continually being revised downward.  China’s economy is undergoing a structural transformation that necessitates slower growth and less reliance on primary commodities.  The prices of oil and other major commodities are stabilizing or declining.  As growth and interest rates pick up in the United States, the dollar gains strength – and emerging market currencies fall.  Brazil’s real hit a 10-year low last week, down to 2.87 to the dollar, amid continuing predictions of zero growth for the country this year.

The traditional tools for weathering the storm may not be available or enough for developing economies.  Floating exchange rates and the resulting depreciation can cause the debt burden on firms and fiscal budgets can bloat overnight, especially in a lower growth environment.  Increasing competitiveness would have helped boost exports, but an IMF study shows that Latin America failed to use one of the biggest commodity windfalls in its history to invest, hindering competitiveness to ride out the tsunami in short-term inflows.  Local bond markets help, but most debt is indeed in dollars, and most local debt is held by foreigners who are always the first to dump such debt.  Interest rate hikes can also be dangerous; they don’t reverse flight and can choke off what little growth there is to be had in a downturn.  Depleting foreign exchange reserves doesn’t always work; increasing debt could bring financial instability but threaten prospects for growth and employment.  Having no good options, emerging-market and developing countries may need to resort to regulating the outflow of capital alongside these other measures.  Such moves have traditionally been shunned by international institutions and capital markets, and new U.S. trade agreements such as the Trans-Pacific Partnership have stripped out balance-of-payment exceptions that allow nations to regulate capital.  But new research in cutting edge of economics by the IMF and others now justifies such measures to prevent or mitigate a full-blown crisis.  If we have learned anything from the global financial crisis since 2008, it is that nations need as many tools at their disposal to prevent and mitigate financial instability.  Instability anywhere can lead to instability everywhere, so we need all tools and hands on deck.

February 19, 2015

* Kevin P. Gallagher is an associate professor of global development policy at Boston University’s Pardee School for Global Studies, where he co-directs the Global Economic Governance Initiative.  His new book is Ruling Capital: Emerging Markets and the Reregulation of Cross-Border Finance.

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by clalsstaff on February 17, 2015  •  Permalink
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Posted by clalsstaff on February 17, 2015

https://aulablog.net/2015/02/17/bracing-for-economic-pain-in-brazil-and-beyond/

Preparing the West Indies for the Demise of PetroCaribe

By Thomas Andrew O’Keefe*

ariwriter / Flickr / Creative Commons Attribution-NonCommercial-ShareAlike 2.0 Generic (CC BY-NC-SA 2.0)

ariwriter / Flickr / Creative Commons Attribution-NonCommercial-ShareAlike 2.0 Generic (CC BY-NC-SA 2.0)

The English-speaking Caribbean nations – whose heavy dependence on imported diesel and fuel oil to generate electricity has placed them among the most heavily indebted countries in the world (on a per capita basis) – will face massive headaches if PetroCaribe collapses.  They eagerly signed up for the Venezuelan initiative, which sells them petroleum with one- or two-year grace periods and long repayment schedules ranging from 15 to 25 years at 1 or 2 percent interest.  Participating countries can even pay with products or services in lieu of hard currency.  In the case of Guyana, Haiti, Jamaica, and the Eastern Caribbean mini-states, PetroCaribe’s financing scheme represents an estimated 4 to 7 percent of their annual GDP.  The worsening economic turmoil in Venezuela, however, raises serious concerns about PetroCaribe’s future.  According to recent media reports, PdVSA, the Venezuelan national petroleum company, is shortening repayment periods and increasing interest rates.

No doubt this is one reason why the Obama administration launched the Caribbean Energy Security Initiative (CESI) in June.  CESI seeks to diversify the Caribbean’s energy matrix away from its current heavy reliance on fossil fuels by using Overseas Private Investment Corporation (OPIC) loans and credit guarantees to encourage private sector investment in renewable energy.  It is premised upon the Caribbean’s huge potential to generate energy from the sun, wind, geothermal sources, and maritime currents.  In the past, the principal bottlenecks to harnessing these abundant resources have been hefty startup costs and small populations that make it difficult, if not impossible, for the private sector to recover profits within a reasonable period of time.  Although the initial capital investment for solar- and wind-based technology has dropped considerably in the last few years, it is unrealistic to expect Caribbean nations to make a full switch to renewable energy resources anytime soon.  A more realistic, short- to medium-term alternative is to make greater use of natural gas.  Although still a fossil fuel, gas is more efficient – and therefore the generated electricity is less costly – than fuel oil and diesel.  Moreover, electricity generated from natural gas emits 70 percent as much carbon dioxide as oil, per unit of energy output.

The shale gas boom in the United States generated by innovations in hydraulic fracturing has led to calls to lift restrictions on U.S. natural gas exports to those countries with which it does not have a free trade agreement.  The Caribbean is potentially a major target market of this natural gas in liquefied form (LNG), but this would be a big mistake.  Lifting restrictions on exports will inevitably raise natural gas prices in the U.S., thereby hurting consumers and putting the nascent revival of domestic manufacturing at risk.  It would also require building expensive LNG offloading and regassification facilities in the West Indies, which would run up against the same economies of scale limitations (except in Jamaica and Hispañola) that have undermined a mass transition to renewable energy.  A more realistic alternative is to revive plans to build a natural gas pipeline from Trinidad and Tobago to Barbados, and then up through the Eastern Caribbean.  Proposed back in the early 2000s, it was scuttled with the appearance of PetroCaribe in 2005.  Trinidad and Tobago has ample reserves of natural gas; at one point before the shale gas revolution it was the largest source of imported LNG in the United States.  The pipeline would link islands with populations of under 100,000, where LNG is economically unviable, with the more densely populated French dominions of Guadalupe and Martinique.  It would also help revive the floundering Caribbean Common Market and Community (CARICOM).

* Thomas Andrew O’Keefe is President of San Francisco-based Mercosur Consulting Group, Ltd.

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by clalsstaff on September 9, 2014  •  Permalink
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Posted by clalsstaff on September 9, 2014

https://aulablog.net/2014/09/09/preparing-the-west-indies-for-the-demise-of-petrocaribe/

Mexico and NAFTA: Lessons Learned?

By Robert A. Blecker*

Photo credit: Alex Rubystone / Foter / Creative Commons Attribution-NonCommercial-ShareAlike 2.0 Generic (CC BY-NC-SA 2.0)

Photo credit: Alex Rubystone / Foter / Creative Commons Attribution-NonCommercial-ShareAlike 2.0 Generic (CC BY-NC-SA 2.0)

Twenty years after the North American Free Trade Agreement (NAFTA) went into effect, it is clear that the promises made by Mexican President Carlos Salinas and U.S. President Bill Clinton – that the accord would make Mexico “a first-world country” and halt the migration of Mexican workers to the United States – have not been fulfilled.  In Salinas’s famous words, Mexico would “export goods, not people.”  But the number of undocumented Mexican immigrants in the United States rose by a conservatively estimated 3 to 4 million during the first two decades of NAFTA, and millions more were apprehended at the border and deported.  The reasons why immigration flows accelerated post-NAFTA are not hard to discern.

  • NAFTA fostered integration of Mexican industries into global supply chains targeted at the U.S. market, accelerating Mexico’s transformation into a major exporter of manufactured goods.  Nearly one million manufacturing jobs were created there in the first seven years of NAFTA (1994-2000).  But this job growth was offset by similar job losses in agriculture, and manufacturing employment has fallen by about a half million since 2001.  The net increase in manufacturing employment from 1993 to 2013 was only about 400,000, less than half of the annual growth in the Mexican labor force.
  • Real hourly earnings in Mexican manufacturing were no higher in 2013 than in 1994, and Mexico’s per capita income has stagnated relative to that of the United States.  In 2012, typical Mexican manufacturing workers received only 16 percent as much per hour as their U.S. counterparts, down from 18 percent in 1994.  Even adjusted for the lower cost of living, workers without a college degree in Mexico still earn only about one-quarter to one-third of what they can earn by moving to the United States.

The benefits of NAFTA for Mexico have been attenuated by several factors.  First, Mexican export industries still largely follow the maquiladora model of doing assembly work using imported inputs, so their value-added is only a fraction of the gross value of their exports and they have few “backward linkages” to the domestic economy.  Second, the Mexican government has frequently allowed the peso to become overvalued, making Mexico less competitive and driving multinational firms to locate in other countries.  Third, the tremendous penetration of Chinese imports into all of North America (Canada, Mexico and U.S.), especially since China joined the World Trade Organization in 2001, has displaced significant amounts of actual or potential Mexican exports.  A revaluation of China’s currency, rising Chinese wages and increasing global transportation costs have recently led to some “reshoring” of manufacturing to Mexico, but employment in Mexican export industries has grown only modestly as a result.

The increased integration of North American industries through NAFTA has proved to be a mixed blessing for Mexico.  U.S. booms have helped Mexico grow, but only for temporary periods, and being dependent on the U.S. market has held Mexico back since the U.S. financial crisis of 2008-2009 and the ensuing “Great Recession” and sluggish recovery.  Of course, NAFTA is but one of Mexico’s constraints.  The country’s restrictive monetary and fiscal policies, frequent currency overvaluation, monopolization of key domestic markets and inadequate investments in physical and human capital have also held it back.  The Mexican economy still suffers from a profound dualism, in which only about one-fifth of all non-agricultural, private-sector workers are employed in large, highly productive firms, while the vast majority are employed in small- or medium-sized enterprises with low, stagnant or even falling productivity.  Mexico’s experience under NAFTA certainly argues against portrayals of international trade agreements, such as the proposed Trans-Pacific Partnership, as panaceas for the economic ills of Mexico or any other country.  Whatever one thinks of the “reform” agenda of President Enrique Peña Nieto – which is focused on areas such as energy, education, and telecommunications – these reforms are unlikely to help Mexico break out of its slow growth trap if the foundations of the country’s trade and macroeconomic policies remain untouched.

*Dr. Blecker is a professor of economics at American University.

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by clalsstaff on July 29, 2014  •  Permalink
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Posted by clalsstaff on July 29, 2014

https://aulablog.net/2014/07/29/mexico-and-nafta-lessons-learned/

Trans-Pacific Partnership: A Framework for U.S.-Latin America Relations?

By Eric Hershberg
Embed from Getty Images
President Obama’s desire to move forward with the Trans-Pacific Partnership (TPP) appears likely to founder amidst Congressional resistance to granting him “fast-track” authority, but it does signal a noteworthy initiative by an administration eager to grow trade relations with some Latin American countries.  Originally formed by Chile, New Zealand, Brunei and Singapore in 2006, TPP is currently negotiating the accession of five new members, including the United States and Peru.  Mexico, Colombia, Costa Rica, Panama, Canada, and Japan are also considering joining.  U.S. Undersecretary for International Trade Francisco Sanchez said last year that agreement on a framework for the United States to join TPP represents “a landmark accomplishment because it contains all of the elements of a modern trade accord.”  It eliminates all tariff and non-tariff trade barriers; takes a regional approach to promote development of production and supply chains; and eases regulatory red tape.  The White House’s senior official responsible for Latin America has also emphasized the importance of the Partnership.

The Administration for the most part has tried to sell the pact as a domestic economic issue – the argument being that more trade and harmonized regulations translate into more jobs – or as integral to a strategic focus on strengthening economic ties to the dynamic economies of Asia, rather than as a policy that has the potential to redefine economic relations with Latin America.  But lobbying on Capitol Hill has so far been ineffective, and Obama’s own Democratic Party has denied him the “fast-track authority” needed for an effective negotiation.  The Administration’s diplomatic strategy has not progressed smoothly either.  During Obama’s recent four-nation swing through Asia, he and Japanese Prime Minister Abe failed to sign an agreement widely seen as crucial for moving ahead with TPP.  Negotiators from all 12 TPP countries met in Vietnam last week, and – despite claims of progress – press reports generally suggest a gloomy prognosis for progress soon.

President Obama has made much of his “pivot” to Asia, and the push for TPP situates Latin America relations in Washington’s wider foreign policy agenda.  The emphasis on the TPP signals that liberalizing trade remains the core principle guiding U.S. thinking about economic relations in the hemisphere, in effect continuing a paradigm that has reigned for decades and that is embodied by proposals such as the now-abandoned Free Trade Area of the Americas.  Unable to secure broad South American buy-in for that U.S.-minted vision for economic cooperation, the administration seems to have settled on trying to work with a “coalition of the willing” comprised of Chile, Colombia, Mexico and Peru.  For governments elsewhere in the region, however, the not-so-particularly-new approach has elicited scant enthusiasm.  One could imagine ambitious proposals from Washington for hemispheric cooperation around energy, climate, infrastructure, technological innovation or even, eventually, labor market integration. But that would require visionary leadership, a commodity that is in strikingly short supply nowadays in the U.S. capital.  Rather than leading the articulation of a novel, shared agenda for a 21st century economic transformation of the Americas, Washington has chosen for now to repackage the last century’s prioritization of trade.

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by clalsstaff on May 22, 2014  •  Permalink
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Posted by clalsstaff on May 22, 2014

https://aulablog.net/2014/05/22/trans-pacific-partnership-a-framework-for-u-s-latin-america-relations/

Caribbean Integration: Necessary but Elusive

By Victor Bulmer-Thomas*

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The dream of Caribbean solidarity has never been in greater peril.  Norman Girvan, who died on April 9, was committed to the cause of Caribbean integration all his adult life, including during his time as Secretary-General of the Association of Caribbean States.  Born and raised in Jamaica, he saw no contradiction between Jamaican nationalism and Caribbean solidarity.  After steady progress from CARIFTA (a free trade area formed in the 1960s by a number of former British colonies) to CARICOM (a customs union formed in 1973 by all British ex-colonies and many colonies) to a commitment starting in 2006 to build a Caribbean Single Market and Economy (CSME), regional integration has gone backwards.  The CSME was never completed; a ‘pause’ in its implementation has been introduced by the Heads of Government and the famous Regional Negotiating Machinery (RNM) – itself formed to promote Caribbean unity in international agreements but then largely dismantled.  Suriname (in 1995) and Haiti (in 2002) have joined CARICOM, but the Dominican Republic is still outside after 25 years of discussions.  Cuban membership is still a distant dream, and the only non-independent state that participates today is the British colony of Montserrat, with a population of 5,000.  CARICOM may in theory represent much of the Caribbean population, but Haiti – its largest member by far – is not in the CSME.

Countries outside the Caribbean have reacted in very different ways to the region since the end of the Cold War.  The European Union (EU), three of whose member states – France, Holland and the United Kingdom – still have territorial ties to the Caribbean, has negotiated an Economic Partnership Agreement (EPA) with CARIFORUM (CARICOM plus the DR) that will in due course give the EU unrestricted access for almost all goods and services.  The agreement has generated very little enthusiasm in the CARIFORUM states despite the improved access for some of their goods and services in the European market.  Venezuela has persuaded most oil-importing countries to join Petrocaribe, but only a handful (Antigua & Barbuda, Cuba, Dominica, St. Lucia and St. Vincent & the Grenadines) have been attracted by the more ambitious ALBA.  The United States, a colonial power itself in the region thanks to Puerto Rico and the Virgin Islands, still offers asymmetrical trade privileges through the Caribbean Basin Initiative (CBI) and its related acts, but some of these provisions will end in 2020, and it is far from clear what will replace them.  Canada, which established CARIBCAN (similar to the CBI) in 1986, is negotiating its own version of the EPA with a broadly similar set of countries, but the negotiations have stalled recently.  Only China appears to have made huge advances in the region through increased exports and major foreign investments despite several of the countries that still recognize Taiwan.

All integration schemes, as Norman Girvan would have been the first to recognize, involve a balance between widening and deepening.  Through its premature commitment to a CSME, the member states of CARICOM took deepening too far.  At the same time, widening – necessary to negotiate with outside powers – has not gone nearly far enough.  It is a scandal that the Dominican Republic remains outside and that so little has been done to embrace Cuba despite the good political relations all states have with the island.  And the non-independent territories, as numerous as the independent states, should not be overlooked.  France and the UK have dropped their objections to closer ties between their territories and CARICOM, and the Dutch territories are largely autonomous already.  Even the U.S. territories would welcome closer links.  And when relations between Cuba and the United States are normalized, as could happen quite soon, it would be in the Caribbean’s interests to have fully embraced Cuba first.  That is an outcome that Norman Girvan would have strongly welcomed.

*Dr. Bulmer-Thomas is a professor at the University College London Institute of the Americas, fellow (and former director) at Chatham House, and author of numerous books, including The Economic History of the Caribbean Since the Napoleonic Wars (2012).

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by clalsstaff on May 1, 2014  •  Permalink
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Posted by clalsstaff on May 1, 2014

https://aulablog.net/2014/05/01/caribbean-integration-necessary-but-elusive/

More Cracks in the EU’s “Common Position” on Cuba

By William M. LeoGrande*

eu cubaThe visit of Dutch Foreign Minister Timmermans to Cuba earlier this month marks yet another crack in the European Union’s 1996 Common Position on Cuba, which conditions normal relations with the island on democratic reforms. Days later, EU Commission President Barroso acknowledged that a number of member states were pressing for a reevaluation of the Common Position, and Spanish Foreign Minister García Margallo announced that the issue would be taken up at the EU foreign ministers meeting on 10 February – adding, however, that any new policy “would have, as a determining factor, respect for human rights.” Amending the Common Position will require unanimity among the EU’s member states, something conservative governments – especially in the former socialist countries – have thus far blocked.

The Common Position has severely constrained the ability of Brussels to respond creatively to rapidly changing conditions in Cuba today, but various European governments have expanded their bilateral economic and political ties with Cuba despite its strictures. Trade between Cuba and Europe, at 2.5 billion euros annually, has roughly tripled since 1996, and official development assistance to Cuba has quadrupled to nearly 60 million euros annually. Policies of engagement have proven more successful than policies of hostility and confrontation.  In 2010, quiet diplomacy by José Luis Rodríguez Zapatero’s government enabled Spain to play a crucial mediating role between the Cuban government and the Catholic Church, leading to the release of more than a hundred political prisoners – the largest such release since the 1970s.

Cuba today is moving in directions that the EU has long favored.  The “updating” of the Cuban economic model, begun in 2011, entails greater economic openness, reduced government regulation of private markets, and a larger role for private sector businesses. At the same time, although challenging Cuba’s one-party system or its socialist society is still out of bounds, there has been a very gradual opening of political space to debate the shape of Cuba’s future.  Replacing the Common Position does not mean that European states, individually or collectively, would abandon their commitment to encouraging greater human rights and democracy in Cuba.  But a warmer political climate would enable them to express their concerns more effectively through quiet diplomacy. What offends Cuba’s leaders is not that other states have different views on these issues; it is that the Common Position makes normal relations contingent on Cuba conforming to European norms, a litmus test that no other Latin American country is required to pass.

*Dr. LeoGrande is Professor of Government in the School of Public Affairs at American University.  This article is excerpted from an essay (click here) he wrote for the London School of Economics and Political Science blog.

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by clalsstaff on January 31, 2014  •  Permalink
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Posted by clalsstaff on January 31, 2014

https://aulablog.net/2014/01/31/more-cracks-in-the-eus-common-position-on-cuba/

Little Promise of Progress on LA Issues in the U.S. Congress

U.S. Capitol Building / Photo credit: Architect of the Capitol / public domain

U.S. Capitol Building / Photo credit: Architect of the Capitol / public domain

Members of the U.S. House of Representatives and Senate appear likely to continue having diverse positions on elements of Latin America policy, but the parties are divided and the proposals – as has been said of the Obama Administration’s – appear piecemeal.  Neither the Democratic nor Republican Party is monolithic; both have diverse voices on the region – with strident internal differences registered on Cuba, Venezuela, the alleged role of Iran, and other contentious issues.  Congressional interest in Latin America tends to swirl around three interwoven areas:

  • On human rights, both parties have expressed concerns, but in very different contexts.  Conservatives continue to press the Administration to be tougher on Cuba, Venezuela, Ecuador and others.  Centrist and liberal-leaning members have urged reassessment of Washington’s position on human rights-related developments in Honduras and Mexico.
  • On security issues, there appears to be vague agreement to give priority to stemming transnational crime and promoting “citizen security” – and to programs that are spinoffs of Plan Colombia and the Iniciativa Mérida – but the Administration’s penchant for militaristic approaches and the concomitant need to cooperate with existing (and often corrupt) forces also draw considerable criticism.  Some members of Congress continue to insist that Iran is laying the groundwork for radical Islam and terrorism in Latin America, but the Administration, while remaining vigilant, has been reluctant to make that concern central to its programs.  Predictably, Congressmen close to former Colombian President Uribe oppose President Santos’s peace talks with the FARC.
  • The trade agenda is also contentious.  Both parties have advocates obsessed with securing trade accords as well as others who are skeptical or even hostile toward them.  With the “Free Trade Area of the Americas” vision of Presidents Bush (father) and Clinton long gone, some members continue to push for bilateral deals, but a three-region approach – linking Latin America, Asia, and the United States – seems to be gaining momentum.  Special deals under the Generalized System of Preferences (GSP) and the Andean Trade Promotion and Drug Enforcement Act (ATPDEA) – already battered by ups and downs in U.S. bilateral relationships – have faded.

Issues like relations with Cuba and Venezuela perennially threaten the broader agenda on Latin America, and the intensity of rightwingers on those issues – including Cuban-American Senators Menendez (D‑NJ) and Rubio (R‑FL) and Representatives Ros-Lehtinen (R‑FL) and Albio Sires (D‑NJ) – tends to intimidate other members of the House and Senate.  Sen. Jeff Flake (R‑AZ) and Reps. Farr (D‑CA) and McGovern (D‑MA) have denounced the embargo, but the Committee chairs in both houses of Congress can block their legislation.  But other aspects of Latin America policy, especially on trade, may advance if the Administration pushes hard – or will wither if it does not.  The result will be a continued reliance on diverse security programs without a broader vision for Washington’s supposed partnership with the region.

 

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by clalsstaff on January 24, 2014  •  Permalink
Posted in United States
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Posted by clalsstaff on January 24, 2014

https://aulablog.net/2014/01/24/little-promise-of-progress-on-la-issues-in-the-u-s-congress/

What does the New Year hold for Latin America?

We’ve invited AULABLOG’s contributors to share with us a prediction or two for the new year in their areas of expertise.  Here are their predictions.

Photo credit: titoalfredo / Foter.com / CC BY-NC-SA

Photo credit: titoalfredo / Foter.com / CC BY-NC-SA

U.S.-Latin America relations will deteriorate further as there will be little movement in Washington on immigration reform, the pace of deportations, narcotics policy, weapons flows, or relations with Cuba.  Steady progress toward consolidating the Trans-Pacific Partnership (TPP), however, will catalyze a shared economic agenda with market-oriented governments in Chile, Mexico, Peru and possibly Colombia, depending on how election-year politics affects that country’s trade stance.

– Eric Hershberg

The energy sector will be at the core of the economic and political crises many countries in the Americas will confront in 2014.  Argentina kicked off the New Year with massive blackouts and riots.  Bolivia, the PetroCaribe nations, and potentially even poster child Chile are next.

– Thomas Andrew O’Keefe

Unprecedented success of Mexico’s Peña Nieto passing structural reforms requiring constitutional amendments that eluded three previous administrations spanning 18 years, are encouraging for the country’s prospects of faster growth.  Key for 2014: quality and expediency of secondary implementing legislation and effectiveness in execution of the reforms.

– Manuel Suarez-Mier

Mexico may be leading the way, at least in the short term, with exciting energy sector reforms, which if fully executed, could help bring Mexico’s oil industry into the 21st Century, even if this means discarding, at least partly, some of the rhetorical nationalism which made Mexico’s inefficient and romanticized parastatal oil company – Petróleos Mexicanos (PEMEX) – a symbol of Mexican national pride.  Let’s see if some of the proceeds from the reforms and resulting production boosts can fortify ideals of the Mexican Revolution by generating more social programs to diminish inequality, and getting rid of the bloat and corruption at PEMEX.

– Todd Eisenstadt

Brazil is without a doubt “the country of soccer,” as Brazilians like to say.  If Brazil wins the world cup in June, Dilma will also have an easy win in the presidential elections.  But if it loses, Dilma will have to deal with new protests and accusations of big spending to build soccer fields rather than improving education and health.

– Luciano Melo

Brazilian foreign policy is unlikely to undergo deep changes, although emphasis could shift in some areas.  Brazil will insist on multilateral solutions – accepting, for example, the invitation to participate at a “five-plus-one” meeting on Syria.  The WTO Doha Round will remain a priority.  Foreign policy does not appear likely to be a core issue in the October general elections.  If economic difficulties do not grow, Brazil will continue to upgrade its international role.

– Tullo Vigevani

In U.S.-Cuba relations, expect agreements on Coast Guard search and rescue, direct postal service, oil spill prevention, and – maybe – counternarcotics.  Warming relations could set the stage for releasing Alan Gross (and others?) in exchange for the remaining Cuban Five (soon to be three).  But normalizing relations is not in the cards until Washington exchanges its regime change policy for one of real coexistence.  A handshake does not make for a détente.

– William M. LeoGrande

A decline in the flow of Venezuelan resources to Cuba will impact the island’s economy, but the blow will be cushioned by continued expansion of Brazilian investment and trade and deepened economic ties with countries outside the Americas.

– Eric Hershberg

In a non-election year in Venezuela, President Maduro will begin to incrementally increase the cost of gasoline at the pump, currently the world’s lowest, and devalue the currency – but neither will solve deep economic troubles.  Dialogue with the opposition, a new trend, will endure but experience fits and starts.  The country will not experience a social explosion, and new faces will join Capriles to round out a more diverse opposition leadership.  Barring a crisis requiring cooperation, tensions with the United States will remain high but commerce will be unaffected.

– Michael McCarthy

Colombia’s negotiations with the FARC won’t be resolved by the May 2014 elections, which President Santos will win easily – most likely in the first round.  There will be more interesting things going on in the legislative races.  Former President Uribe will win a seat in the Senate.  Other candidates in his party will win as well – probably not as many as he would like but enough for him to continue being a big headache for the Santos administration.  Colombia’s economy will continue to improve, and the national football team will put up a good fight in the World Cup.

– Elyssa Pachico

Awareness of violence against women will keep increasing.  Unfortunately, the criminalization of abortion or, in other words, forcing pregnancy on women, will still be treated by many policy makers and judges as an issue unrelated to gender violence.

– Macarena Saez

In the North American partnership, NAFTA’s anniversary offers a chance to reflect on the trilateral relationship – leaving behind the campaign rhetoric and looking forward. The leaders will hold a long-delayed summit and offer some small, but positive, measures on education and infrastructure. North America will be at the center of global trade negotiations.

– Tom Long

The debate over immigration reform in Washington will take on the component parts of the Senate’s comprehensive bill. Both parties could pat themselves on the back heading into the mid-term elections by working out a deal, most likely trading enhanced security measures for a more reasonable but still-imposing pathway to citizenship.

– Aaron Bell

The new government in Honduras will try to deepen neoliberal policies, but new political parties, such as LIBRE and PAC, will make the new Congress more deliberative. Low economic growth and deterioration in social conditions will present challenges to governability.

– Hugo Noé Pino

In the northern tier of Central America, despite new incoming presidents in El Salvador and Honduras, impunity and corruption will remain unaddressed.  Guatemala’s timid reform will be the tiny window of hope in the region.  The United States will still appear clueless about the region’s growing governance crisis.

– Héctor Silva

Increased tension will continue in the Dominican Republic in the aftermath of the Constitutional Tribunal’s decision to retroactively strip Dominicans of Haitian descent of citizenship.  The implementation of the ruling in 2014 through repatriation will be met with international pressure for the Dominican government to reverse the ruling.

— Maribel Vásquez

In counternarcotics policy, eyes will turn to Uruguay to see how the experiment with marijuana plays out. Unfortunately, it is too small an experiment to tell us anything. Instead, the focus will become the growing problem of drug consumption in the region.

– Steven Dudley

Eyeing a late-year general election and possible third term, Bolivian President Evo Morales will be in campaign mode throughout 2014.  With no real challengers, Morales will win, but not in a landslide, as he fights with dissenting indigenous groups and trade unionists, a more divisive congress, the U.S., and Brazil.

– Robert Albro

In Ecuador, with stable economic numbers throughout 2014, President Rafael Correa will be on the offensive with his “citizen revolution,” looking to solidify his political movement in local elections, continuing his war on the press, while promoting big new investments in hydroelectric power.

– Robert Albro

Determined to expand Peru’s investment in extractive industries and maintain strong economic growth, President Ollanta Humalla will apply new pressure on opponents of proposed concessions, leading to fits and starts of violent conflict throughout 2014, with the president mostly getting his way.

– Robert Albro

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by clalsstaff on January 7, 2014  •  Permalink
Posted in Regional Snapshot
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Posted by clalsstaff on January 7, 2014

https://aulablog.net/2014/01/07/what-does-the-new-year-hold-for-latin-america/

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