Latin America Risk Report - 2 July 2020
Three polls show presidents losing support as the coronavirus crisis continues
Good morning. In today’s edition:
Mexico - AMLO’s ratings on a slow decline
Peru - Vizcarra also on a slow decline
Argentina - Fernandez too
Region - The ratings boost before the fall
This week, paying subscribers received an analysis of the CJNG attack in Mexico City last Friday as well as a preview of the Dominican Republic election this weekend. Please consider supporting this newsletter by subscribing at https://boz.substack.com/subscribe.
Mexico - AMLO’s ratings on a slow decline
A new poll from El Financiero has President Lopez Obrador’s approval rating dropping to 56%, mirroring several other recent polls that have suggested a slight decline in the president’s ratings. While still positive for Mexico’s president, the decline is going to be difficult to turn around.
Source: El Financiero
One key reason for the decline is economics. At the beginning of the year, only 8% of the population said the economy was the top issue while 73% said the lack of security was their top concern. Now 30% of the population says the economy is the top issue, with only 18% saying public security. That switch is not because perceptions of security have improved; voters continue to give similar (and poor) marks to AMLO on his security efforts as they did six months ago. Instead, the economy has worsened in a way that it now takes precedence. AMLO’s approve/disapprove numbers on economic policy started the year at 45/33 in favor of the president and have move to 20/65, a major shift in public opinion that is certainly influenced by the near 20% decline in GDP in April.
The second reason for the decline is in the perception of AMLO personally. Voters continue to view the president as honest, but only 33% now view him as a president capable of delivering results.
Meanwhile, voters continue to doubt AMLO’s policies on security and his efforts to combat corruption, both of which are net negative. The poll was conducted prior to the CJNG attack last Friday in Mexico City, meaning the perception of security may decline further.
Peru - Vizcarra also on a slow decline
A Datum poll published last week showed President Martin Vizcarra’s popularity down to 65%, down 11 points in the past month and 17 points from its peak in April. A number of the president’s cabinet ministers also polled worse including the ministers of health and economy. I wrote about Vizcarra’s potential public opinion problems in early June.
Argentina - Fernandez too
Source: Perfil
Public opinion for the Fernandez administration in Argentina is on a similar downward trend, even as it remains relatively positive for the president. According to Opinaia (a relatively favorable polling firm for the president), the president’s approval rating is at 67%, down 15 points from two months ago. Other polls published in Argentina’s media in the past month show similar results.
The public’s views on Argentina’s economy are poor, but they were poor before anyone was worried about coronavirus. There has been
Brendan O'Boyle writes in Americas Quarterly how the recent surge in cases in the capital region may impact Argentine politics moving forward. While the president and his opponents have cooperated in the early months of the crisis, discontent over the lockdowns and the economy could push the two sides apart.
Interestingly, the debt negotiations don’t appear to impact Fernandez’s approval rating. Health issues and concerns about the broader economy are what voters care about.
The good news for the president, in the short term, is that Fernandez has the political capital and public support to do as he’d like in the negotiations. The public supports his government and will likely support his strategy, no matter where he takes it (within reason, obviously).
The downside for the president is that he’s unlikely to receive any boost for his handling of the negotiations. Any attempts to demonize Argentina’s debt holders are not going to matter for voters. Right now, the voters have bigger concerns and there is a bigger demon in the room (Covid) that voters know deserves the blame for the biggest problems of the moment. This makes the negotiations different from the ones Argentina has done in the past.
Region - The ratings boost before the fall
Just a few months ago, AMLO was one of only two presidents with an approval rating above 60% in this hemisphere. Now AMLO’s numbers have dropped below 60% even after giving him a slight boost at the beginning of the crisis. The region’s health crisis has given boosts to other presidents including Vizcarra and Fernandez, pushing them higher in the polls than Mexico’s president.
However, there are good reasons to believe the high approval ratings are temporary in all three countries. I’ve written multiple times about the region being in an anti-incumbent moment and in late April I wrote that the initial public opinion boosts may not last. The approval ratings from April, May and June on the graphics above appear as if they’re on a similar slope and that is true with several other presidents in the hemisphere as well. Outside of its consequences for elections, there is nothing magical about the 50% mark in approval ratings, but I still expect many presidents to have additional problems as their numbers inevitably drop into negative territory in the coming months.
Along a similar line of thinking, Michael Reid wrote in last week’s Economist that the lessons of the economic crises of the 1930’s and 1980’s demonstrate that these sorts of events often lead to political turmoil in Latin America.
Corruption Corner
Brazil - An investigative report documented the PCC using 38 medical companies and dental clinics to launder money, purchase supplies and provide medical assistance to wounded gang members. At times, the companies received government contracts and managed public health care as the gang leadership bribed local public officials.
Brazil - Federal police conducted searches and detained eight people related to an investigation of Wilson Lima, the governor of the Amazonas state, and overpayments the state government made on coronavirus-related contracts to obtain ventilators.
Argentina - Jordana Timerman’s daily news summary caught this op-ed in the New York Times. Her description:
A judicial investigation has uncovered an extensive spy network that operated in the shadows of the country's intelligence agency and illicitly spied on politicians, journalists and leaders of civil society. Included among the targets were former president Cristina Fernández de Kirchner -- now the country's vice president. Though the espionage was apparently carried out at the behest of members of the then-governing Macri administration, journalist Hugo Alconada Mon -- another of the targets of the illicit surveillance -- notes that rogue intelligence agents have been a scourge of Argentina's democracy for decades. While he urges reform, which current President Alberto Fernández promised, he is pessimistic about success.
Mexico - AMLO ordered investigations into renewable energy contracts signed by the CFE. Critics of Mexico’s president correctly note that this is another example of AMLO politicizing anti-corruption efforts. He is focusing on shutting down renewable energy - something he opposes because it competes with the oil industry - while ignoring the much larger issues of corruption at the CFE that are linked to allies of the president.
Reading List
Ozy - The Next El Chapo is Coming for Your Smartphone
Halo Trust - Northern Triangle: Living with armed violence
IMF Blog - Outlook for Latin America and the Caribbean: An Intensifying Pandemic
Miami Herald - Trump administration cripples Latin America’s ability to fight COVID-19
New York Times - Latin America Is Ready for Its Black Lives Matter Reckoning
Christian Science Monitor - Neighborly test in US-Latin America ties
Bloomberg - Latin America Top Bank Asks Nations to Think Big About Recovery
BBC - Argentina and Brazil crops threatened by locust swarm
ZD Net - Brazilian federal police investigates presidential data leak
Americas Quarterly - Huawei or Not? Brazil Faces a Key Geopolitical Choice
InSight Crime - Mexico’s Environmental Activists Killed for Resisting Infrastructure Projects
Al Jazeera - Mexico 'more violent' and 'worse' two years after AMLO election
Forbes - President Lopez Obrador Is Failing Mexico
InSight Crime - A Fractured System – Mexico’s Criminal Investigation Network
Associated Press - Venezuela sanctions set off fight for ‘plundered’ oil cargo
Bloomberg - A Fifth of Food Output Is Wasted in Famine-Threatened Venezuela
Reuters - More than 100 Colombian soldiers implicated in sex abuse of minors, army says
Miami Herald - Criminal gangs for hire: Corrupt cops and the fight for votes in Haiti’s next elections
Guardian - Huge oil discovery off Guyana raises the stakes in election fraud case
NACLA - Trump Bets on Closer Ties with Bolivia
Wall Street Journal - Ecuador City Beat One of World’s Worst Outbreaks of Covid-19
DFRLab - Cuba-linked Twitter activity trends in Venezuela
Brookings - The opioid crisis in America: Domestic and international dimensions
Foreign Affairs - The Rise of Strategic Corruption
World Economic Forum - Why support for Latin America's early tech hubs is vital for the region
Thanks for reading
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