Tuesday, November 15, 2016

Trumps policies could derail Mexico -- but don't jump to conclusions (Nov. 15, 2016)

Proposals by U.S. president-elect Donald Trump could force millions of migrants back to Mexico, leaving the country to deal with the loss of billions of the dollars in remittances, and the massive influx of people with no jobs could provide potential recruits for drug cartels and worsen already sky-high violence, reports the Associated Press.

Migrants sent home almost $25 billion in remittances to Mexico in 2015, funds that mostly went to the country's poorest. And the country already has a job shortfall for the 800,000 youths who join the workforce each year -- accommodating returning migrants would be difficult.

And a current plan to deport only criminals could also backfire -- like when the U.S. deported Central American members of Los Angeles street gangs, creating the current gang problem in the region, according to the AP piece. Experts say at least some of the potential deportees will use already established U.S. connections to increase the amount of illicit drugs sent across the border.

Nonetheless, the deportations likely won't be able to happen as fast as Trump has threatened, notes the piece.

Financial Times paints a similarly grim picture for Mexico, which has a $100 billion annual trade surplus with the U.S. that could be jeopardized by reduced outsourcing from that country or import tariffs imposed on Mexican products.

But a New York Times op-ed by Ioan Grillo counters the hype. Deporting criminals is already the U.S. policy, and "there are limits to what Mr. Trump can do alone; Congress, the courts and business will all have much to say on all these issues, and could well force him to take a more moderate position."

And despite a long history of clashes between the two countries, there was also a half a trillion dollars in trade between the two last year, and a series of coordinated policies. The latter include Mexico's cooperation in stopping Central American migrants heading to the U.S. border, notes Grillo.

"... Trying to force Mexico to pay for a border wall, or slapping on tariffs that would savage its economy, could fracture this cooperation. Mexico may be smaller than the United States, but it is still a major economic and political power. If Mr. Trump pushes too far, it could hit back with its own tariffs that hurt American exporters. It would see no incentive to reduce the flow of migrants and refugees from other countries to the United States. And pushing Mexico into recession may only make more people here pick up and head north anyway. As much as Mr. Trump seems to like abusing Mexico and its people, President Trump would be wise to try a different tack," he concludes.

In a similar vein, ripping up trade agreements between the two countries would be significantly harmful to the U.S. economy and affect the regions' competitiveness on a global level, said Jaime Serra Puche, Mexico’s chief negotiator during the North American Free Trade Agreement (Nafta) negotiations in an interview with the Guardian.

"The degree of integration within North America has increased dramatically since Nafta 20 years ago, to the point where we’re not only trading with each other, but now producing many things together. Mr Trump needs to understand that introducing protectionist measures would introduce obstructions and self-inflicted problems on the region including the US, as we would all lose competitiveness vis-a-vis the Chinese, Europeans and other regions," said Serra.

And it's not clear that Trump would be able to prevent U.S. investment in Mexico, notes FT.

On a broader level, the ugly stereotypes of Mexicans pushed by Trump during the election stoked long-held insecurities south of the border, and his win seems a ratification of those negative perspectives by their neighbors too the north, reports the New York Times. "Clouds have descended over Mexico, miring it in a state of anguish and paralysis after the election of Mr. Trump to the highest office in the world. They are clouds of uncertainty and fear, of self-doubt and insecurity. There were even actual storm clouds hanging over the capital in recent days, a literal echo of the nation’s state of mind," writes Azam Ahmed rather poetically. 

Apart from Mexico, Colombia, Honduras and Liberia could be the countries most affected by Trump's election, according to the Financial Times. They are particularly vulnerable, though nobody really knows for sure what policies he'll implement, due to their high dependance on exports to the U.S. or remittances from the U.S.

Brazil's currency was one of the worst hit in the emerging market sell-off after Trump's victory, and President Michel Temer is trying to restore confidence in his reform program, reports the Financial Times separately.

In the meantime, Argentina's President Mauricio Macri is seeking to rekindle ties with Trump, who he worked with as a businessman, before either was in politics, reports Reuters. A statement from the Argentine presidency says Trump promised Argentina and the United States would have "the closest relationship in history."

And Obama's final trip abroad -- including a visit to Peru -- will be spent trying to reassure allies concerned about Trump, reports the Los Angeles Times. At a summit for the Asia-Pacific Economic Cooperation organization, Obama will have to admit the possibility that Trump will pull out of the Trans-Pacific Partnership trade deal Obama spent years pushing. And the U.S. might also pull out of the global climate deal jumpstarted by an agreement between the U.S. and China two years ago.

News Briefs
  • The revised peace accord between Colombia and the FARC presented yesterday is final, say negotiators. Their stance will likely anger opponents of the original deal, rejected by voters last month, reports Reuters. The new deal does not have to be ratified by plebiscite, and could simply be presented to Congress for approval. But critics say it's just a tweaked version of the original accord. Negotiators say the changes reflect 500 proposals from opponents, and address most of their concerns. (See yesterday's post.)
  • Special gang jails in El Salvador, implemented earlier this year as part of a crackdown on the violent organizations, keep inmates in concentration camp like misery, according to a brutal report by the country's human rights attorney general's office. The HR attorney general has been the only permitted entry to the seven prisons aimed at keeping gang members in utter isolation and cut off from their minions on the street. But the inhumane conditions described in the report, covered by El Faro, are shocking: inmates receiving food in their hands, denied medical treatment for gunshot wounds, diabetes and hypertension, extreme overcrowding and children locked in cells with their mothers for 24 hours a day.
  • Salvador's prosecutor's office suspects that a luxury mansion owned by former President Antonio Saca was built with diverted public funds, reports El Faro. (Saca was arrested last month on charges of diverting more than $18 million from government coffers to the private accounts of acolytes. See Oct. 31's briefs.)
  • An international group of experts will investigate the murder of Honduran activist Berta Cáceres earlier this year. The five lawyers from Guatemala, the U.S. and Colombia -- the International Advisory Group of Experts (GAIPE) -- has been convened by Cáceres' family, after the Honduran government has rejected calls for an independent, international investigation into the assassination, reports the Guardian. "The expert group will investigate the state’s response to the crime, as well as the role played by corporations and international banks which backed the Agua Zarca dam."
  • Millions of dollars from Brazilian government coffers aimed at tackling the Zika virus epidemic have gone unused or misspent by state authorities, hampered by laws limiting use of funds for long-term projects and general mismanagement, reports the Washington Post. An additional complicating factor: heightened scrutiny of government spending in the wake of the Petrobras corruption investigation, which has some state authorities preferring to leave funds unused altogether.
  • More than 20,000 people have been displaced by flooding due to heavy rainfall in the Dominican Republic, reports the BBC.
  • Multinational corporations are selling off their Venezuela operations at firesale prices, or even giving them away in an attempt to escape from crushing inflation and shortages, reports Reuters.
  • Another piece on Venezuelan President Nicolás Maduro's tone-deaf Salsa program, this time from the Guardian.
  • Netflix is already getting criticisms for its portrayal of Medellín cartel leader Pablo Escobar. (See former Medellín mayor Sergio Fajardo's take, for example.) But a new series set to air next year, focusing on Escobar's infamous hitman known as Popeye, is set to make even more waves. Jhon Jairo Velásquez got out of prison after 23 years, and has managed to launch a new career on YouTube, as an author and even in Hollywood, reports the Miami Herald
  • The Cuban government announced it would pardon 787 prisoners, in answer to Pope Francis' call for clemency, reports Reuters. The government does not admit to having political prisoners, and said those released would include women, youths, the ill and "other categories."

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