Wednesday, May 25, 2016

Austerity measures proposed in Brazil (May 25, 2016)

Acting Brazilian President Michel Temer announced a slew of measures aimed at boosting investor confidence in the country and distancing himself from suspended President Dilma Rousseff. 

He said he would try to repeal nationalist oil legislation, curb public spending and shut down a sovereign wealth fund, though he did not go into detail as to how he plans to convince Congress to approve the program, reports the New York Times.

The measures could include shutting down a $563 million sovereign wealth fund created during Brazil’s commodity boom and requiring the early repayment of some $28 billion of debt that state development bank BNDES owes to the national treasury, reports the Wall Street Journal.

Temer proposed an unusual constitutional change aimed at limiting government spending. The bill would cap federal spending increases to the previous year's inflation rate, reports the WSJ.

When he assumed office two weeks ago, Temer promised a particular focus on overhauling the pension system, and set a 30 day deadline for a proposal, reports the Wall Street Journal separately. The new finance minister, Henrique Meirelles, said the system must be "sustainable and self-financed." But talk of raising the retirement age has incurred the wrath of powerful unions and pensioners groups.

Getting the proposals approved will be a test for the new government. Though he has broad support in the Congress, Temer needs a supermajority in the legislature to pass a constitutional change.

Yesterday the new government scored a legislative victory: Congress approved a revised budget plan for this year that allows a government deficit of $48 billion, reports the Wall Street Journal in another piece. It reflects a new, pessimistic, budget unveiled by Meirelles last week. 

Without the change, the acting government would have been forced to meet nearly impossible surplus goals set out last year. Rousseff presented a similar measure in March, to recognize the inevitable deficit, but Congress was focused on her ouster and never debated the measure, reports El País.

Temer accuses critics of carrying out "psychological aggression." 

News Briefs
  • Three journalists have disappeared in Colombia's volatile Catatumbo region, a situation that raises pressure on President Juan Manuel Santos, who has staked his presidency on establishing peace with the country's armed groups. Salud Hernández-Mora, a correspondent for Spain's El Mundo newspaper who writes a popular weekly column in El Tiempo has been missing since Saturday, and there is speculation that she was kidnapped by the ELN. Two journalists from the right-leaning network RCN who were in the region covering the manhunt for Hernández-Mora are now also unaccounted for, reports the Guardian.
  • The disappearances show how the central government lacks territorial control in vast swathes of the country, according to Colombia Reports. Catacumbo is one of the country's prime coca growing areas and has long been under control of armed groups. The entire episode endangers the incipient ELN peace accord process, and shows its fragility, argues Silla Vacía. (Though Silla Vacía in another story has a source that says Hernández-Mora is not kidnapped at all but in pursuit of a story.)
  • Constitutional Court public hearings for the peace plebiscite in Colombia start tomorrow. Santos will speak, as will Interior Minister Juan Fernando Cristo, High Peace Commissioner Sergio Jaramillo, and the government's lead negotiator with the FARC, Humberto de la Calle, reports El Espectador. The court will decide the legality of legislation passed by Congress last year that modifies the threshold for a positive referendum on the peace deal, lowering it to 13 percent for "yes," and allows public officials to campaign in favor of the agreement, reports El Heraldo.
  • Without a positive vote, the peace agreement hammered out in Havana with the FARC cannot be enacted, warned Santos, according to El Tiempo.
  • Mary Anastasia O'Grady uses her Wall Street Journal column this week to denounce Santos' request to Congress for powers to amend the constitution, saying he has borrowed a leaf from the the "Bolivarian strongman" playbook. "Santos wants this authoritarian power so he can unilaterally change the constitution to include the terms of a "peace" accord he has been secretly negotiating with the Revolutionary Armed Forces of Colombia (FARC) for almost five years. He initially promised a referendum on the final agreement so Colombians could vote point-by-point on its particulars, such as whether guerrilla felons should be able to run for office. But he went back on that promise—and many others—a long time ago," she argues.
  • Actually, the Colombian Constitution is a big winner in the process, argues Silla Vacía. The 1991 document will hardly be touched by the peace agreement, which will only require a few transitional amendments. The process shows the strength of the constitution, rather than its weakness as critics say, according to the piece.
  • Guatemalan police say they've captured six Mara Salvatrucha gang leaders. They were apparently captured at an international meeting of representatives of Mara Salvatrucha leaders from Central America, reports Soy 502.
  • Guatemalan President Jimmy Morales announced the approval of reforms to the country's electoral and political party law, passed in April by the Guatemalan Congress. He said he is preparing a new bill that will address issues not contemplated by the new law, reports La Hora. The reforms address voting abroad, better supervision of political organizations, strengthening of public financing for political organization, prohibition of public officials to proselytize at public activities, regulation of payment of advertising space, among others. But Morales said the reforms left out a budgetary increase for the electoral tribunal, internal democratization of political parties, and did not contemplate term limits for legislators and discarded quotas, parity and minority representation.
  • Immigration to the U.S. from El Salvador and Honduras is often driven by brutal gang violence. But Guatemalans undertaking the dangerous journey are often spurred more by economic concerns, reports the Guardian. The piece focuses on the case of Cajolá, a small, indigenous Guatemalan town, which has nearly a third of its population in the U.S. already.
  • Part of an ongoing series on abortion in Latin America by Reuters reports on how women in Colombia, where abortion is technically legal, find the practise out of reach due to bureaucratic hurdles, dangerous delays and stubborn attitudes.
  • Another piece from the Reuters series, looks at Brazil, where abortion is illegal except in cases of rape or incest or if the life of the mother is in danger. The government has cracked down on hundreds of illegal abortion clinics over the past decade, due to a rising numbers of evangelical Christians in the Brazilian Congress, according to human rights groups. Press reports say that a woman dies every two days from an illegal abortion.
  • Argentina's resolution of a 15-year debt legal battle, along with economic reforms carried out by President Mauricio Macri are paying off in loans. The World Bank's International Finance Corporation is more than tripling its investment in Argentina, reports Bloomberg.
  • Cuba's government said it will seek to legalize thousands of small- and medium-size businesses that have sprung up in recent years, a step that could encourage more entrepreneurship in the country, reports the Wall Street Journal.
  • Assistant Secretary of State William W. Brownfield said talks with Cuba over law enforcement issues shouldn't get ahead of broader bilateral negotiations, reports the Miami Herald.
  • Afro-Cuban activists are caught between a government that denies the existence of racism and fellow black Cubans who lack racial consciousness, reports The Nation.
  • Chilean high school students posing as tourists burst into the Chilean presidential seat, el Palacio de La Moneda, and protested the government's educational reform. They say they were not consulted for President Michelle Bachalet's signature policy and demand more access and financing from the state for university students, reports El País.
  • Peru's government declared a state of emergency in a dozen towns along the Brazilian border, due to mercury contamination. The heavy metal is used in gold mining, and up to 50,000 people could be affected, reports TeleSur.
  • Amnesty International is demanding the Mexican government apologize to Jacinta Francisco, an indigenous woman who spent three years in jail accused of kidnapping six security force agents, reports El País.
  • A mob in the small Mexican town of Atlatongo, in Mexico State is holding the mayor hostage, demanding the liberation of 18 townsfolk detained over the lynching of two people. They were kicked to death, accused of kidnapping by a crowd of nearly 600, reports El País.
  • Kinder Suprise and McDonald's Happy Meals will be forbidden in their current, toy-carrying form in Chile, as part of a new bill attempting to curb rampant child obesity, reports El País.
  • Patricia Derian, known as Patt, who served as U.S. President Jimmy Carter's chief human rights advocate, died last week. She is credited with saving thousands of lives through her campaigns to pressure authoritarian regimes to spare dissidents. "She had frank confrontations with a number of heads of state, warning them that American aid would end unless they granted due process to political prisoners and stopped killing political rivals. Some leaders were receiving opposite signals from others in the government, according to later disclosures, and were furious about it," writes the New York Times in its obituary. A piece in COHA celebrates her lasting impact on U.S. foreign affairs, despite successive governments that eschewed her political stance.

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