Six stories - 12 December 2024

Comments on Mexico, Brazil, Paraguay, Venezuela-Guyana, Haiti and Nicaragua

I continue to send the Tuesday essay and Friday reading list to everyone for free - no paywall planned ever for those. The paid newsletter has been settling into a nice rhythm in which I cover US policy toward Latin America on Mondays and a polling analysis on Wednesday (yesterday I wrote about Ecuador’s election). Thursday’s newsletter contains a potpourri of six brief comments about other security and politics news items around the region.

I’m sending the first two comments to everyone today to give readers a taste of what’s behind the paywall. If you work for a company or organization that needs more Latin America analysis, please consider becoming a paid subscriber.

Also, please free to respond to this email with feedback, comments, and questions.

Congressman Benito Aguas of the Green Party was murdered in Veracruz. The body was found shot multiple times along with another victim at the scene in the municipality of Zongolica.

While local political violence is unfortunately common and increasing in Mexico - Veracruz has an unfortunate history of being one of the worst states for the targeting of mayors, journalists and civil society actors - political violence does not commonly hit national level politicians. This murder occurred two months into Sheinbaum’s term. Once could be random chance, but if there is a second federal politician targeted in the coming two months, feel free to call it a trend.

More broadly, I glanced at the October homicide statistics from Mexico’s government and there was nothing about the one-month trends that told any clear story about where Sheinbaum’s government and security strategy are going. I’m going to give it a few more months before I try to read the trends. The Financial Times, however, reports on the recent massacre in Queretaro and says that sort of murder could be a concerning new trend for that region.

As a final security note, President Sheinbaum is planning on raising the salary for the Mexican military.

1. Her government is using it as a justification for why it was worth saving costs by shutting down regulatory bodies.

2. The AP story on the issue suggests that there are problems within the military budget due to challenges with the infrastructure projects handed to the military. There could be an important overlapping narrative here about the military budget and Pemex budget controversies.

3. The government is offering military raises but not funds for civilian police reform? It breaks with Sheinbaum’s previous narrative of a more strategic and softer security policy.

Brazil - Lula went into emergency surgery and markets cheered. The Real strengthened and stocks went up. Sure, the Central Bank hiking interest rates had something to do with it too, but the bounce was notable after several weeks of markets dropping due to Lula’s fiscal policies.

The morbid analysis that is hard to write is that markets think Vice President Geraldo Alckmin would be far better for the economy than Lula. If Lula is forced to leave office or is simply not governing full time while he recovers, then the government will spend less and get along better with the center-right Congress. Lula’s health issue also makes it less likely that he runs for reelection in 2026, which is something markets want to avoid.

I wrote the above analysis on Wednesday night. On Thursday morning, Brazilian Report published their newsletter headline of “Morbid Markets” making some very similar points and using the same word: morbid. Great newsletters think alike! They also made the following comment which I found to be an important caveat:

Yes, but: In a recent poll by Quaest, Finance Minister Fernando Haddad — a Lula loyalist, albeit more fiscally hawkish than the president — emerged as a leading contender in simulated head-to-head projections against conservative rivals, suggesting he would clinch the presidency if the election were held today.

It’s not every week that Paraguay makes big foreign policy moves.