Latin America Risk Report - 27 September 2019
Mexico security stats and new polls in Uruguay
In this edition:
Mexico - Bad security statistics for AMLO
Mexico - AMLO ignores the UNGA
Uruguay - New polls suggest two way race
Nicaragua - Poll shows increasing rejection of Ortega
Guyana - Election delayed to March; president and opposition clash on foreign oil contracts
Venezuela update
Mexico - Bad security statistics
As I’ve written about previously, President Lopez Obrador’s high approval rating is eventually going to take a hit due to poor security statistics. Several statistics this week show the reality crashing into AMLO’s optimistic spin.
A recent government survey - the Encuesta Nacional de Victimización y Percepción sobre Seguridad Pública (ENVIPE) - says nearly 82,000 kidnappings occurred in Mexico during 2018. This would make Mexico the worst country for kidnapping in the world.
The survey is based on self-reporting by the respondents rather than police reports. This survey model captures a greater number of crimes (because many people do not report being kidnapped to the police out of fear or the belief that the police will not assist). However, it is also likely that many Mexicans self-report brief detentions and robberies as kidnappings. While those events are truly terrifying to the victims, this blurs the definition between an armed robbery and what many security analysts would classify as a kidnapping.
Separately, the group Alto al Secuestro reports kidnappings are up 29% in the first eight months of 2019 compared to the same time period in 2018.
Animal Politico reports that only a quarter of police nationally are certified at the required level. This is on top of previous reporting showing nearly 20% of police who did not go through or failed their confidence tests (which include polygraphs, financial disclosures and a drug test) remain on duty.
Mexico - AMLO ignores the UNGA
While most of the region’s leaders enjoy their opportunity to visit New York, mingle with world leaders and outline their administration’s priorities and accomplishments to the world, AMLO stuck around in Mexico. In doing so, Mexico’s president highlighted his own isolationist/nationalist tendencies. He has yet to leave the country as president.
In spite of not being present and generally being against US policy towards Venezuela, Donald Trump surprisingly and publicly thanked AMLO for his cooperation at a meeting of Latin American leaders regarding the crisis in Venezuela.
AMLO isn’t just missing out on his opportunity to position Mexico as influential in the world. He is also missing an opportunity to talk directly to the New York finance community that is highly critical of his economic policies including his management of Pemex’s current financial crisis.
Uruguay - New polls suggest two way race
A poll from Opcion has the Uruguayan presidential election with Martinez at 30, LaCalle 23, Talvi 12, and Manini Rios 12. Equipos Consultores has similar numbers, with Martinez at 31, La Calle 26, Talvi 12, and Manini Rios 9.
Both polls show a decline for Talvi in recent weeks.
Another poll from Equipos shows only 27% of Uruguayans consider themselves members of the ruling Frente Amplio (FA), down from 36% in 2014. At the same time, 36% citizens do not identify with any party, significantly higher than the 24% who said the same five years ago. While that declining party affiliation is bad for the ruling party candidate, there is some good news in that President Vazquez’s approval moved up three points to 37%.
I attended a Wilson Center event on the Uruguay elections earlier this week. The panelists largely agreed that after 15 years of the Frente Amplio ruling the country, voters are looking for alternatives. There is a growing concern about the FA’s inability to tackle the key challenges of the day including security and economic growth. Voters are also concerned about corruption within the government and the use of the country’s social welfare system in a clientelistic manner.
Still, the four-way race makes the outcome unclear. While the most likely scenario remains a runoff between Martinez and LaCalle, Talvi’s center left candidacy pulls votes from the ruling Frente Amplio while Rios on the far right is eating into the support for LaCalle. Talvi would likely beat either Martinez or LaCalle in a hypothetical second round. However, if he doesn’t make the second round, it’s not obvious how Talvi’s votes in the second round would divide between Martinez and LaCalle and that could be the deciding factor.
Nicaragua poll shows increasing rejection of Ortega
Only 19% of Nicaraguans approve of Daniel Ortega while 57% disapprove according to a September 2019 poll by CID Gallup. That negative 38 point net approval rating is the worst of Ortega’s term.
In contrast, a hypothetical coalition between the two main opposition forces - the Alianza Cívica por la Justicia y la Democracia and the Unidad Nacional Azul y Blanco - receives 44% approval and 28% disapproval.
The Ortega government has increased its repression against media outlets in recent weeks. El Nuevo Diario has been shut down because Ortega’s customs unit has blocked it from receiving the materials it needs to print.
Guyana - Election delayed to March 2020; president and opposition clash on foreign oil contracts
The US and EU are increasing pressure on President David Granger’s government to hold elections, claiming the country is in violation of its own constitution by not holding elections that have been mandated by a no confidence vote last December and confirmed in a court ruling over the summer.
Granger announced this week that the earliest he can hold an election is in early March 2020. Granger also indicated he will recall the parliament in early October to obtain an “extension” that will permit the election delay that the president has already announced. The opposition has already denounced the president’s attempt to place a fig leaf over his violation of the constitutional process. They want an election as soon as possible and believe one can be organized for November.
Granger hopes to delay the election in order to show the population the benefits of the oil production scheduled to come online in the next few years. Granger is rightfully concerned that Guyana’s population has seen few benefits so far compared to the high expectations for economic growth in the coming years.
Former President Bharrat Jagdeo of the PPP has threatened to review the contract terms of recent private sector investment. His campaign will focus on a promise to deliver a better deal to the Guyanese people than Granger’s government. This means the election, whenever it comes, will be critical to the future of oil development in Guyana.
Venezuela update
On Tuesday I published commentary on the implications of the TIAR for paying subscribers. I’ve dropped the paywall on it and everyone can access the report here.
Since I wrote that report, Maduro and his entourage have had their meeting in Russia with Vladimir Putin. They received a shipment of flu vaccines and promises to maintain weapons systems sold by Russia, but no new deals on oil or humanitarian aid that the government had hoped to obtain. In a blow to the hardliners in Maduro’s circle, Putin acknowledged the legitimacy of the Guaido-led National Assembly and recommended Maduro return to the Norway-mediated negotiations process.
A large number of Maduro regime officials traveled outside the country simultaneously during the de facto president’s trip to Russia. Diosdado Cabello made a public visit to North Korea. Tareck el-Aissami was out of the country. Delcy and Jorge Rodriguez appeared to leave for New York City for the UNGA. While there was significant speculation about why all the individuals traveled at the same time, sources in Venezuela could not provide any concrete reasons for the sudden surge in travel.
A large number of flights from Russia have landed in Venezuela over the past 7-10 days. There have been few public announcements about what sort of equipment or personnel is being shipped in or how many tons of gold have been shipped out. Russia has said there are personnel in the country to repair military equipment.
A number of PSUV legislators rejoined the National Assembly. They were given time to speak and nearly all made a case for the legislature to work to reverse the sanctions by the US and other countries against Venezuela and officials in the Maduro regime.
Their speeches did not do much. The Trump administration banned a large number of the regime - including members of the ANC, high ranking military officers, and their families - from traveling to the US. The EU placed new sanctions on seven individuals accused of torture and human rights abuses.
Corruption Corner
Region - A new Global Corruption Barometer report from Transparency International finds that most Latin American citizens believe corruption is getting worse in their countries and their governments are not doing enough to combat corruption. Over 20% of the region’s citizens paid a bribe to access a public service in the past year and over 25% were offered a bribe to influence their vote during an election. The corruption and lack of public faith in the investigative process threatens the region’s democracies.
Ecuador - Eduardo Xavier Larrea Cruz, who ran civil aviation from 2007 to 2009 under former President Rafael Correa, has been allegedly working with the Sinaloa Cartel to traffic cocaine. Larrea and his brother were arrested in Belize after having flown a load of cocaine from Venezuela into Honduras.
Reading List
Miami Herald - Haiti’s president says he won’t resign. But is he ready to drop his prime minister?
NYT - To Influence El Salvador, China Dangled Money. The U.S. Made Threats.
Wilson Center - Understanding the Venezuelan Refugee Crisis
Americas Quarterly - How Businesses Can Help Venezuelan Refugees
Atlantic Council - The Untapped Potential of the US-Colombia Partnership
WSJ - Why Argentina Faces an Economic Crisis. Again.
Thanks for reading
Back in Colombia after a couple days of very nice weather in DC. Running a few miles at sea level after living at an altitude of 8,600 feet for a month is always a great feeling.
Keep the comments and questions coming.