Financial & Economic Crisis hits Latin America

It was the turn of Latin America's stock market to take a nose dive this Wednesday - "Dark day for faltering LatAm stocks" . In Chile they dropped 6.3%, in Mexico by 7 %, in Brazil by 10%, and last but by no means least Argentina, where they dropped by 18%.

The magnitude of the drop in Argentina was provoked when President Cristina Fernandez announced plans to nationalise the private pension funds.

She said the nationalisation would protect retirement funds from the global financial crisis, but analysts said the move would drain company access to private capital. Argentina's Congress is expected to approve the proposal within weeks. BBC News: "Turmoil in Latin American Markets".

Privare investors have been upin arms, not least a Merrill Lynch executive who stated bluntly that his bank had now written off any investment plans in Argentina "for at least the next half decade." - AFP, "Latin America in Jaws of Global Crisis"

As I mentioned in an earlier post - "Global Depression: So What About Latin America" - much of the worry in Latin America on the back of the current world financial crisis, stems not so much from the so-called credit crunch, but rather the sharp recession that's meant to hit the world's major markets in the Northern hemisphere, and the decline in commodity prices that it will entail.

Correspondents say international demand is declining for many of Latin America's commodity exports, including oil, copper, iron ore and soy as global growth slows amid the current financial global crisis BBC News, "Turmoil in Latin American Markets".

Whilst demand may be faltering in the US and Europe, demand from the likes of China is still bouyant.

This is not to say that all is as gloomy as one could fear. Precious global recessions have tended to hit Latin America harder than most. The analogy of "when the US economy sneezes, the rest of the world cathces a cold, but Latin America catches phnuemonia" having proven to be quite fitting in th past. This time round things may be slightly different. According to former Mexican foreign minister, Jorge Castañeda:

the region would be largely impervious to the recent crisis. Mexico, Chile, Brazil and Uruguay should manage just fine, emerging with only bruises and scrapes, he argued. Colombia and Peru would weather the storm, though suffering greater harm. But he warned of "severe damage" for Venezuela, Bolivia, Ecuador, Central America and the Caribbean. BBC News, "Brazil squares up to an economic storm"

The severe damage awaiting Venezuela has much to do with the sudden drop in oil prices. Overdependent on oil revenues, Venezuela's extensive public spending could be seriouly affected if oil prices continue on this downward trend. It is therefore no surprise that Venezuela qill be pushing for oil output cuts at this week's hastily convened OPEC gathering in Vienna.

Venezuelan Oil Minister Rafael D. Ramirez said the OPEC members "have to take some action now, now," adding that Friday's meeting will reach "consensus to take a very, very, very fast action." Xinhua, "OPEC members divided over oilput cut"

Last week I attended a public meeting at the Houses of Parliament here in London, where Venezuelan ambassador to the UK, Samuel Moncada, whilst almost gleeful in his depiction of the collapse of the world's financial system, had to admit that Venezuela faced difficult times ahead. So what about all the windfall funds from record-high oil prices that the Venezuelan had been meant to have store away for precisely those times when the oil prices were on the fall? Well, according to the ambassador this would only cover Venezuela's problems for a mere 2-3 months.

South American World Cup Qualification - 10th Round

In a brief post here are the results from matchday 10 of South American qualifying competition for the World Cup.

• Chile vs. Argentina: 1-0
• Bolivia vs. Uruguay: 2-2
• Paraguay vs. Peru: 1-0
• Brazil vs. Colombia: 0-0
• Venezuela vs. Ecuador: 3-1

These results leaving the qualifying table looking like this:

1. Paraguay: 23 pts.
2. Brazil: 17 pts
3. Argentina 17 pts.
4. Chile 16 pts.
5. Uruguay 13 pts.
6. Ecuador 12 pts.
7. Colombia 11 pts.
8. Venezuela 10 pts.
9. Bolivia 9 pts.
10. Peru 7 pts.
    

Paraguay are seemingly running away with the qualification campaign leaving the region's giants - Brazil and Argentina - to fumble about, scrapping points against teams they should normally be able to put away with ease. For Argentina, their defeat away to Chile, the first time this has happened in absolute eons, marked the end for Argentine coach Alfio Basile. The writing had supposedly been on the wall for a good few months now. Lacklustre performances, an endless procession of drab draws in recent matches was not want the Argentine public were demanding. Especailly since Argentina stormed to a gold medal at the Olympics, sweeping aside Brazil along the way. But, this under the guidance of the younger a more attack-minded Sergio Batista - Basile having opted of a leading the young Argentine squad at the Olympics.

Here is what BBC's Latin American football specialist Tim Vickery of Basile's legacy:

But as Basile leaves the scene, he deserves to be remembered. He is one of the game's romantics, for whom the joy of expression speaks louder than the fear of defeat - a philosophy that might be old fashioned, but which should never be out of date.

He remains the last Argentina coach to win a title at senior level - the 1991 and 93 Copa America triumphs from his first spell in charge, which ended with one of the great World Cup matches of recent times, the 3-2 defeat to Romania in 1994. It was a classic tie of attack versus counter-attack, made attractive by the fact that Argentina accepted the risks of taking the game to their opponents.

The highlight of his second spell, before the breakdown in relationships started corroding performance, came last year in the Copa America.It ended in tears, stiffled and picked off by Brazil in the final. But the previous matches were an exhibition of passing football, patient and audacious, hypnotic and dazzling. Being there in Venezuela to watch Alfio Basile's side in action was an immense privilege

Qualification games take a bit of a break for the next few months, with the next not taking place until late March. Plenty of time I'm sure for the Argentine media to get hyped up about the return of the prodigal son, Maradonna, as a possible successor.

The Once Glorious Uruguayan World Cup Winners

In the wake of the weekend's South American world cup qualifiers, The Times, had a great piece on the River Plate derby, Argentina vs. Uruguay - Past masters Uruguay burdened by the weight of history.

On Saturday, Uruguay succumbed to a 2-1 defeat away to Argentina and will need a win away to Bolivia this Wednesday if they are to get back into the automatic qualifying places for the World Cup.

Scrapping to get into the World Cup, and then failing to make it pass the group stages seems to be the perennial outcome of every Uruguayan World Cup campaign. Never likely to reach the lofty heights they once achieved back in the first half of the 20th century when they lifted the World Cup trophy in 1930 and 1950.

Watching Uruguay play is a bit like driving past the boarded-up shop-fronts of a once-thriving city centre. The phantasms of a glorious past haunt you. Occasionally you see flashes of pride and quality, more often you see a rage against the dying of the light. Except, whereas a depressed city centre might hold out hope to be regenerated, Uruguay will probably never regain its footballing greatness

To read about plight of Uruguayan football and their resignation to being a mere Latin American football minnow, do check out this article. Past masters Uruguay burdened by the weight of history.

South American World Cup Qualification: Round #9

Here are the results and standings from the weekend's South American Qualification games:

• Bolivia vs Peru 3-0
• Argentina vs. Uruguay 2-1
• Colombia vs. Paraguay 0-1
• Venezuela vs. Brazil 0-4
• Ecuador vs. Chile: 1-0

1. Paraguay 20 pts.
2. Brazil 16 pts.
3. Argentina 16 pts.
4. Chile 13 pts.
5. Uruguay 12 pts
6. Ecuador 12 pts
7. Colombia 12 pts
8. Bolivia 8 pts
9. Venezuela 7 pts
10. Peru 7 pts
    

Paraguay remain on course for World Cup 2010 qualification and with a home game coming up against Peru this Wednesday should be able to consolidate their standing at the top of the South American group. Any doubts that Brazil would be struggling in this qualification group are being slowly laid to rest as they notched up another victory, albeit against minnows footballing minnows Venezuela.

Global Depression: So What about Latin America?

In the midst of the financial turmoil that has swept ominously across North America and Europe, news how this may affect Latin American economies – traditionally so dependent upon the state of the U.S economy – has been somewhat hard to come by in the British press.

Nevertheless, last week’s The Economist did have an article highlighting the numerous pessimistic scenarios that may be played out in Latin America as a result of the financial turmoil in the world’s credit markets – “Keeping their fingers crossed”. True to its right-of-centre, pro-market editorial line it predicted that the “badly behaved” economies (i.e. overly statist and anti-neoliberal), such as those in Venezuela and Argentina, are the one that are most vulnerable.

Their vulnerability stems not so much from the lack of credit available to them, but their overreliance on commodities: Venezuela on oil, Argentina on agricultural produce. The belief being that a downturn in the world economy would naturally lead to a slump in commodity prices.

Other Latin American countries look set to be hit by a decline in commodity prices as they have fallen to the age-old temptation of overspending when times have been good and consequently saving little for when times worsen. Bucking the trend, as is so often the case when it comes to perceived sound economic management, is Chile where its copper stabilization fund should insolate the economy from a slump in copper prices.

Fortunately for the likes of Brazil, Colombia and Peru – “the well-behaved countries” in The Economist’s tinted eyes – their trade surpluses and balanced budgets, records of year-on-year growth, and lack of dependency on the increasingly limited sources of foreign credit should offer their respective economies the means to avoid the recession that has so often followed in the wake of U.S. downturns.

But all isn’t rosy in the case of Mexico, and indeed with most Central American and Caribbean nations. By remaining so dependent on US markets and remittances from relatives working in the US, the severity of the economic crisis facing the US will have the inevitable effect of casting a long murky shadow over their economies. Perhaps this will nail home the argument that despite the lure of the US market Latin American nations can only benefit from diversifying trading partners, increasing regional trade and so on.

In the aftermath of all this financial mess it seems likely – especially if the Democrats retake the White House – that all proposed free trade agreements with Latin America are to be put firmly on hold; furthering the need for Latin America to look towards China and the rest of Asia.

Despite the relative upbeat tones, The Economist makes sure to hammer home that it will be the Bolivarian following of Chavéz et al and their economic populist policies that have most to fear from the global credit crunch.

Argentina's National Airline Renationalised

Any general overview of Latin American economic history will show you how attitudes for or against nationalisations and privatisations swing back and forth over time with a pendulum-like consistency.

The 1980s and 1990s saw the pendulum of state vs. private debate swing back in favour of privatisation after the presumed overreach, corruption and mismanagement of the state-owned enterprises of the mid-20th century. SOEs were meant to have fuelled economic development in many a Latin American country. Unsurprisingly, perhaps, it wasn’t long before the pendulum swung back the other way and privatisation became a word that any politician sought to distance themselves from as far as humanly possible. Of course this didn't always stop them from implementing privatisation. In Bolivia during the 1990s, President Gonzalo Sánchez de Lozada was somehow able to hood-wink the Bolivian people into believing that when he was selling off the rights of the country’s natural resources to foreign multinationals, it wasn’t so much 'privatisation' but rather 'capitalisation'. Yes, there is a difference, but it’s a slight one at best. And it ultimately left the Bolivian government unable to benefit from the huge windfalls that were soon to be made from Bolivia's recently discovered huge natural gas reserves. But more on that in my dissertation paper...

Anyway what drew my attention today through my daily trawl through the BBC website was the news that the Argentine government is to renationalise its floundering airline, Aerolineas Argentinas - Argentine Airline Set For Bumpy Ride. The national airline was one of many companies to been sold off rapidly when Carlos Menem was Argentine President back in the 1990s. Now with the left-of-centre and so-called ‘back-to-the-roots populist Peronism’ of the Kirchner's in hold of the Casa Rosada (Buenos Aires's answer to the White House) a number of the sectors once privatised by Menem have been renationalised.

It seems pretty obvious that it’s going to be hard, if not impossible to bring Aerolineas Argentinas back into profit. Then this nationalisation isn’t just about making a profit. Okay there is the nationalistic sentiment – something Argentines have in bucket loads - that goes hand-in-hand with having a national airline. And with a majority of Argentines actually favouring the government taking control of the airline, it would make political sense for under-pressure President Cristina Kirchner to do something that for once wouldn’t have half the nation up in arms. However I think in a country like Argentina, a country that is so immense in its geographic dimensions, with numerous far-away provinces that depend upon a direct link to the capital, needs a national airline. An airline that is more concerned with servicing these far-away communities than with make a profit at the end of the year.

Putting Those 1978 Ghosts to Bed

Whilst the Spaniards were ending 44 years of hurt with their victory over Germany in the Euro 2008 final this past Sunday, a different kind of ‘hurt’ was being put to bed in Buenos Aires.

30 years had passed since the Argentine national team lifted their first ever World Cup trophy. It was a tournament they hosted and should have gone down as a glorified moment in Argentine folklore. However it remains forever blighted by the dark military dictatorship and the so-called “Dirty War” it inflicted upon its people. The way in which the regime purposefully used the staging of the World Cup as propaganda tool, à la Hitler’s 1936 Olympics, and as to distract a population’s worries about the continuous desaparecidos has cast a black shadow over what was at the time Argentina’s greatest ever sporting triumph. Moreover, though slight in comparison, the military have been accused of bribing the Peruvian national side to lose heavily to Argentina, when the Argentines needed at least a 4-0 victory to guarantee their place in the final (they beat Peru 6-0).


This Sunday ex-members of the World Cup winning team, human rights activists took part in a memorial match - "La otra final: el partido por la vida y los derechos humanos" - for the 30,000 Argentines who lost their lives during this dark chapter of Argentine history. Many of the ex-players had wanted to put to bed once and for all that they in someway had been used by the military regime. As young football players they had little idea of the horrors being perpetrated by their leaders and little understanding of how their success was being manipulated to make a population turn a blind eye towards the atrocities.

Perhaps most chilling of all is the stories of the imprisoned opponents in the military detention and torture that was situated only a short distance from the main stadium in Buenos Aires during the World Cup. Here prisoners told how, chained to their beds, they could hear their guards listening to the game on the radio and the crowds celebrate as the goals went in. The 1980 Nobel Peace Prize Winner, Adolfo Pérez Esquivel, who was imprisoned at the time recalls how

En la prisión, cuando ponían el partido en los altoparlantes, era muy contradictorio. Porque los ejecutores, aquellos que nos torturaban, y nosotros, las víctimas, gritábamos juntos '¡Gol de Argentina!'. Y sabemos que sacaban afuera a prisioneros cuando había distracciones por la Copa Mundial y les disparaban (source BBC Mundo "A 30 años de un triunfo empañado" 30/06/2008)

When they played a game over the speakers, it was very contradictory - because the executioners, those who tortured us, and us the victims both cried 'Goal Argentina!' And we know that they took prisoners out when there were distractions caused by the World Cup and shot them (source BBC News, "Football match evokes Dirty War", 30/06/2008)

Thankfully for Argentine and Argentine football only a few years would have to pass before the dictatorship crumbled and Maradona could restore national pride with the his glorious one-man show in the 1986 World Cup in Mexico.

Is Brazil Part of Latin America?

There has never been any contestation that Brazil is somewhat unique amongst the assemblage of Latin American states:

• It’s Portuguese heritage
  
• It’s ability to remain united – rather than splinter into numerous squabbling territories, as happened with the Spanish empire
  
• It’s sheer size – population, economy, territory is as large as that of all the other South American countries put together.

So the differences between Brazil and the rest of the Latin American nations are obvious. However, it would be impossible to see Brazil as anything else but an integral part of any study of Latin America? Well so we thought... Leslie Bethell of Oxford University gave a talk the other week at the Institute for the Study of the Americas entitled “Is Brazil part of Latin America?” Well he would say that given that he was director of the Centre for Brazilian Studies - when it is normally commonplace just to lump Brazil in under Latin America.

Simon Bolivar was supposed to be the great instigator for Latin American unity, However his grand vision had nothing to do with Latin American unity as we know it, but rather of a confederación hispanoamericana – a Hispanic confederation that excluded Brazil. Brazil was not Hispanic and seen as intrinsically different from the rest of the Americas:

• It wasn’t a republic, but a monarchy
  
• It still permitted slavery
  
• It has closer ties with Europe, something the new Hispanic American republics were at pains to distance themselves from.

Not that Brazil really cared about not being part of this Hispanic American club. It’s Portuguese heritage meant that it was naturally imbued with a hostile attitude towards anything related to Spain. This along with a sense of superiority meant that Brazilians were quite happy to be excluded.

In the late 19th century, with the dreams of a unified Hispanic Americas long gone, the notion of Latin America did grow as an idea, especially amongst Latin American intellectuals. They sought to focus on the similarities across the Latin American continent as a counterweight to the increasing dominance and interventionism of the US and its of ides of American (North + South) unity through the a US-led Panamericansim.

However well up into the 20th century Brazil was still seen as a non-integral part of Latin America. In an era of fervent anti-Americanism in Latin America, Brazil persistently remained less critical of the US and was of the US’s more reliable allies. Furthermore Brazil continued to perceive itself unique and indeed superior from the rest of Latin America.

Arguably Leslie Bethall had indeed made a persuasive historical argument as to how Brazil had differentiated itself from the rest of Latin America. However he continued to argue that still today Brazil is markedly different from the rest of Latin America, is still perceived so by Brazilians themselves and that it ultimately deserves to be studied as a completely different entity in exclusion from Latin America. I think this was the point at which most people in the audience would have started to take issue with him.

The interconnectedness of Latin American countries – Brazil included – is plain to see. Brazil borders almost all South American nations, and in today’s world can’t not be influenced, culturally, economically, politically by the rest of Latin America and vice versa. Aside from a difference in language, there is no doubt in my mind, that Brazil is an integral part of Latin America. Yes there are many things which are unique to Brazil, and yes Brazilians will no doubt from time to time see themselves as unique and superior to the rest of the neighbours. But you need just to take a trip over the river Plate to realize that the Argentineans are just as capable, if not more so, in espousing a sense of difference and a superiority with the rest of the continent. Brazil’s leadership in MERCOSUR and the recently unveiled Union of South American Nations (UNASUR) only highlights its attempt to place itself, if not at the centre of Latin America, then at least South America – Mexico, Central America and the Caribbean already seem locked into the US sphere of dominance.

Critics may well turn around and say – and Leslie Bethall would be one of them – that Brazilian leadership is not much wanted amongst South American nations, who view these attempts of regional unity with Brazil at their helm as merely a means to help Brazil to propel itself onto the world stage…

This has been quote a long post…thank you if you’ve managed to get this far. I’ll finish with a few comments by former Brazilian President on this very issue - “Brazil: A Latin American Nation?” - that seem to underscore my point of view as well.

Despite differing colonial histories, languages and state institutions, Brazil does indeed share a relation with Latin America. […] Along with some cultural, geographical, and ideological traits, Brazil and other Latin American nations share a position on the “periphery” of the modern globalized world. […] We belong to Latin America […] We feel at ease in Latin America. (The Washington Institute for International Studies, 14/03/2007)

South American World Cup Qualification - 6th Round

Whilst Brazil's former coach was getting knocked out of Euro 2008 with Portugal, his former side weren't making much progress back in South America. Brazil played out a dreary 0-0 draw against arch-rivals Argentina in the so-called clásico. A result that now leaves them in 5th place in the South American qualification table for the 2010 World Cup. Of course the Brazilian press were quick to pile the criticism on Brazil's coach Dunga

The Brazilian media were in no doubt as to who was responsible for the Canarinha's unsatisfactory showing. The harshest criticism came from Lance!, which ran with a cover featuring Dunga's head inside a noose and topped by the headline "Hung". "Brazil draw with Argentina as the fans vent their fury on coach - Zico now the popular choice," fumed the sports daily.O'Globo also registered its displeasure on its website. "Dunga gets the donkey treatment as off-key Brazil draw 0-0 with Argentina," ran the merciless headline. Publishing a photo of Ronaldinho in the stands at the Estadio Mineirao, the website added that the Barcelona man and Kaka were sorely missed, stating that "without them the future looks bleak". With Brazil's other stars having another off day, O'Globo also remarked on the warm applause Lionel Messi received when he was substituted.Running with a front page photo of a closely marked Adriano trapping the ball on his chest, Jornal do Brasil opted for a short but no less powerful headline: "270 minutes without a goal". The online version of the paper was just as critical: "Even with the Mineirao right behind them, Brazil were incapable of beating Argentina. To cap it all, the fans chanted 'Dunga out' as he made his way off the pitch. All in all, a sad goodbye for a coach who had stakedeverything on this game."Joining in the chorus of disapproval was Folha de Sao Paulo. "What a miserable clásico", it complained before highlighting the fans' displeasure: "The crowd whistled the team and demanded Dunga's sacking." (source: fifa.com)

Otherwise results of note included group leaders Paraguay losing 4-2 to Bolivia. Bottom spot in the group now belongs to Peru after being 6-0 thumping by Uruguay. And Chile have now displaced Brazil from the important 4th place spot - the top 4 teams qualify for the World Cup -with an exciting 3-2 away win to Venezuela.

Results:

• Brazil vs Argentina: 0-0
• Venezuela vs Chile: 2-3
• Ecuador vs Colombia: 0-0
• Uruguay vs Peru: 6-0
• Bolivia vs Paraguay 4-2

Table:

1. Paraguay.....13 pts
2. Argentina....11 pts
3. Colombia.....10 pts
4. Chile.............10 pts
5. Brazil.............9 pts
6. Uruguay........8 pts
7. Venezuela.....7 pts
8. Ecuador.........5 pts
9. Bolivia............4 pts
10. Peru...............3 pts

Here is a good youtube video with all the highligts from this weeks' games. Disfrutenlo!

South American World Cup Qualification - 5th Round

So whilst the major European soccer power (minus England, I guess) slug it out for the European championship this summer, South American nations took another step in their long and arduous qualifying campaign for the 2010 World Cup. Up until now, after 4 games, the story had been of Paraguay leading the way with 10 points, and I guess of Brazil still not having started to fire on all cylinders, with only 2 wins from 4 games.

Well yesterday’s 5th round of qualifying matches emphasised those points with Paraguay stunning the Brazilians with a 2-0 victory in Asuncion. With plenty of games still to go and the first 4 teams guaranteed qualification there is no need to push the Brazilian panic button quite yet, but still…

Otherwise it’s a case of ‘as you were’ with all 3 of the ties ending in draws and Bolivia predictably losing to their age-old enemies Chile in La Paz – so much for the advantage of altitude. And also of note is Venezuela's progress. They're normally the team cemented to the bottom, given how Baseball probably overrides football as their national sport.


Bolivia vs. Chile 0-2
Argentina vs. Ecuador 1-1
Peru vs. Colombia 1-1
Uruguay vs. Venezuela 1-1
Paraguay vs. Brazil 2-0

_______________________

The table now looks a bit like this:

1. Paraguay 13 pts

2. Argentina 10 pts

3. Colombia 9 pts

4. Brazil 8 pts

5. Venzuela 7 pts

6. Chile 7 pts

7. Uruguay 5 pts

8. Ecuador 4 pts

9. Peru 3 pts

10. Bolivia 1 pt

________________

Below are a few youtube video highligths of the differetn games. The quailty isn't great but the audio commentary is as outrageously South American as one could hope for. Enjoy...

Paraguay vs. Brazil: 2-0

Argentina vs. Ecuador: 1-1

Bolivia vs. Chile: 0-2

Peru vs. Colombia: 1-1

Uruguay vs. Venezuela: 1-1

The next round of games take place later this week with the obvious highlight being the battle of the titans- Brazil vs Argentina. Paraguay should also be looking to consolidate thier lead at the top of the table with a relatively easy game against the Bolivians. But I'll make sure to let you all know how they got on.

Castles in the Sand: A prediction of more economic turmoil in Argentina

Here is a news article from the The Development Executive Group that popped into my inbox this morning. Unfortunately it predicts more economic turmoil for turmoil-ridden country. Headlines shouting out “Farming Crisis” have been staring me in the face from the Financial Times and The Economist alike, the last few weeks. Yet it’s with trepidation that I even begin to embark on understanding the complexities and , for some, the irrationality that seemingly forever embeds Argentine macroeconomic policies. But it has to be done…

But anyway here's a nice easy analogy for Argentine economics to get us going.

"Argentina is like a kid who makes a really good sand castle at the beach, takes
a lot of care in building it just right, then steps on it himself. Things have
been good recently. Now we have to put a question mark on everything."

-- Taxi driver Jose Luis Baldini, 60, voicing a bleak notion that has become conventional wisdom for many in Argentina here: Good times never seem to last. Today's Argentina is not gripped by crisis but rather by the fear of crisis, the Washington Post reports. Several strikes by farmers, furious over government policies, have sparked concerns about lasting damage to the economy. Many Argentines have been exchanging their pesos for dollars, forcing the government to dip into its surplus to keep the currency stable. Consumers, told that their government faces a shortage of natural gas, are bracing for blackouts. As recently as February, the government had been buying up vast quantities of dollars to keep the peso's value artificially low -- a strategy designed to boost exports and domestic investment. But after the farm conflict began, Argentines traded millions of pesos for dollars and forced the government to flip its strategy: It's now dipping into its USD 50 billion reserve fund to prop up the value of the peso, the Post reports. "The government right now is fighting the people who bring the dollars into this country, namely the farmers," said Alejandro Marino, 49, a lawyer in Buenos Aires. "Despite what the government is saying, there are clear signs that there will be a shortage of dollars here one day."

Global Development Briefing - Castles in the Sand

Me and My 'Mate'

The first thing any Argentine ex-pat most do upon arrival in the new foreign homeland is seek out their nearest yerba mate supplier. Having spent the best part of year out in the Argentine hinterland, I couldn’t not bring back with me my own mate set along with a 4 kilos of the yerba. With great diligence and extreme rationing this was able to get me going through my first year away from the Argentina. However for the past many months, with my supply depleted, my mate has found itself lost & lonely in some forgotten corner of a kitchen shelf.

Admittedly my search for mate in London hasn’t been as earnest as it could have been. Surely there is a large enough Argentine ex-pat community in London to warrant some form of mate outlet? Well luck had it that whilst wandering the cobbled streets of Oxford, I was able to stumble upon a specialist tea & coffee store that sold yerba, albeit of the Brazilian variety.

So I probably paid an extortionate price - £2.75 for a small bag of 250g – but now I can feel that yerba caffeine kick which has gotten me through countless last-minute essay writing situations in the past. Coffee just doesn’t quite do it.

But if anyone does know of where to get cheap yerba in London, do drop me a line…

Photos - courtesy of Mikko Takkunen

Soda Stereo - Me verás volver

For whatever reason 2007 turned out to be a year that saw countless bands of yesteryear reunite. Led Zeppelin, The Police, The Verve, Spice Girls and numerous others for sure. Nothing to make the blood boil in my musical books.

On the other side of the Atlantic, and south of the Rio Grande the Latin music business had also caught the big-band reuniting bug. What's more it was my #1 Latin rock outfit, Argentine Soda Stereo, that decided to bring themselves together and set out on an extsensive continent-wide tour. Unfortunately, unlike all those wealthy Led Zeppelin fans who seemed to jet into London from all 4 corners of the world the other week for their one-off gig, jetting out to Buenos Aires was unfortunately beyond my limited means. Instead I spent much of yesterday, the day of their final gig in el Estadio River Plate in Buenos Aires, with my mp3 player shuffling out tunes from all the various Soda albums I've managed to get hold over the years.

It's almost 10 years to the day that the went out with a bang on their "El Ultimo Concieto" tour of Latin America, and shockingly almost 10 years now since I stumbled upon an MTV video from those concerts of their hit-song "La Musica Ligera". Given that my entire CD collection to that point was made up of English language albums, it was definitely a minor momentous moment to head up to my local CD store in La Paz and leave with my first ever Rock en Españ ol CD, Soda Stereo's "El Ultimo Concierto". Who would have known, good decent rock does exist in other languages. Now it was just a matter of time before a plethora of other surprisingly good Latin Rock acts would come my way: Lucybell, Cafe Tacuba, La Ley, Cuentos Borgeanos, Attaque 77, Babasonicos, to just name but a few.

Still Soda Stereo tops the lot and it's good to see their popularity across Latin America is a high as ever, with countless record-breaking stadium concerts to their name in almost the countries they've passed through the last couple of months. Unfortunately it'll be futile to expect that they'll hop across the pond and perform here in London despite the ever-increasing ex-pat Latino community here. Nevertheless at least I can take heart from the fact that their lead singer, Gustavo Cerati, ventured here for a solo gig last year which was almost as good as it gets.

So being the end of the year and the season of end of year top-10 lists, I leave you with my own personal top-10 list of favourite Soda hits:

• En la ciudad de la furia
• Té para 3
• Toma la ruta
• Nada personal
• Tratame Suavemente
• Profugos
• Planeador
• Cuando Pase el Temblor
• Ella usó mi cabeza como un revólver
• Angel Eléctrico

Another President in the Dock

Turn the clock back some 20 years ago and much of Latin America was a murky world of dictatorial, authoritarian regimes where human rights abuses were common place. Military regimes had come to power under the belief that they were legitimately holding back the spread of Communism and the social revolutions that were supposedly threatening to overrun the region.

In Latin American economics we talk of the 1980s as the ‘lost decade’ where economic growth stagnated or went backwards. Along those same lines the late 1970s and much of the 1980s can be looked upon as the decade of the desaparecidos (the ones who disappeared). The hundreds of thousands who literally disappeared in the ‘dirty wars’ fought by military governments against those guerrillas and left-leaning movements that opposed them.

One by one though, many of those political leaders who stood at the forefront of these dirty wars are being brought before national courts and sentenced. The Southern Cone countries of Chile, Uruguay, and most notably Argentina have been, and continue to be, at the forefront of confronting their murky pasts. These weeks though the attention has switched to Peru where its former head of state, Alberto Fujimori, has been put on trial for the supposed massacres he ordered at the height of the war against Sendero Luminoso (The Shining Path) in the early 1990s.

There are some notably differences that make his trial noteworthy. First of all, that he was extradited to Peru from Chile and neighbouring country with whom they have never had the most cordial relations in the world (but then which neighbouring South American countries ever have sincere cordial relations one may ask?). Regional cooperation with regards to dealing with past human rights abuses seems to be an important step forward. Secondly Fujimori must be one of the first democratically elected, civilian Presidents to stand trial for crimes against humanity in South America. Former Presidents in both Argentina and Chile have stood trial but they were both military dictators. So questions may be asked as to which currently elected civilian presidents should be quaking in their boots? Please feel free to nominate any...

At the moment though Fujimori has been found guilty for some relatively minor abuses of power which will see him spend the next years in prison. In the coming months he will face further charges of the more serious accusations with regards to his role in the massacres of civilians in the Peruvian Andes.

Given so many of the problems Latin America faces on a day-to-day basis and how it lags behing the world on so many issues, it is nothing short of impressive how their otherwise weak and seemingly corrupt judiciary systems have been successful in bringing to court some of the most powerful figures of Latin American history. It's perhaps no surprise then that when the International Criminal Court was set up to pursue crimes against humanity on a worldwide basis that they chose Luis Moreno-Ocampo, an Argentine with experience their own dealing with human rights abuses to be the court’s Prosecutor.

Argentina's Presidential Couple

It’s not often full page newspaper spreads here in the UK are dedicated to Latin American politics. So perhaps it was quite a surprise to find Monday morning's newspapers adorned with the face of Cristina Fernandez de Kirchner, Argentina’s newly elected President. But given the uncanny resemblances between Cristina and the only other Argentine political figure we’ve ever bound to have heard of, Evita, perhaps it shouldn't be too much of a surprise after all.

I don’t think even in Argentina people were able to get too overwhelmed by the whole election. For many the result was a forgone conclusion right from the very outset of the campaign. Was this down to the success of her husband, Nestor Kirchner, in bringing the country back from the economic and political quagmire of 2001/2002? Or was it down to the inability of the opposition forces to unite against a charismatic female leader who was always able to draw on the inevitable Evita undertones and resemblances as a sure means to derive support from the Argentine masses? Furthermore the election campaign was an unorganised affair, with people wondering as to why Nestor Kirchner chose not to stand for re-election, and why it was that Cristina spent much of the campaign abroad and less than willing to participate in debates and unveil concrete policy issues?

So Argentines are yet again left in the dark as to what expect from the future. Whilst the emergence of yet another female as a head of state in Latin America (Michelle Bachelet became the President of Chile last year) in otherwise macho dominated arena can only be a good thing, it still remains unclear as to whether she will be able to do anymore than her husband in redistributing the profits the country seems to be raking in with an annual growth rate of 8%, or be able to anything to dampen the impression of Nestor’s Kirchner’s perceived undermining of democratic processes. And how will she be able to reposition Argentina internationally after Kirchner’s presidency has left Argentina isolated, given his anti-US rhetoric and strong ties with Hugo Chavez’s Venezuela? One thing is for certain, dinner at the Kirchner’s must be quite something if her policies start to deviate considerably from those of her husband’s.

Britain's 'forgotten' invasion of Argentina

Anglo-Argentine relations have always had me slightly perplexed. Being British things naturally become clouded, either by the Falklands or Argentina’s regular ability to knock us out of various football world cups - and I guess Argentina notions of England (though not British) are based upon much the same things. But in reality there’s so much more. Argentina’s fascination with typical British sports such as polo and rugby, the dominance of English-style architecture with regards to train stations and haciendas, to name but a few things. Whilst living in Argentina these things soon made me realize that Anglo-Argentine relations have been about far more than fruitless wars over tiny inconsequential islands and football matches.

Surprisingly perhaps, Britain’s colonial empire never formally penetrated Latin America. Weak South American states were never transformed into yet more British colonial outposts. Instead throughout the 19th century we focused on trade and the (forceful) creation of open Latin American markets, as a means to sell our homemade manufactured goods. An “informal empire” or “business imperialism” of sorts. And it was with Argentina, more than any other Latin American state, that this was evident. But things in Argentina could have been so, so different.

Last Friday’s seminar, an event co-hosted by my institute (the Institute for the Study of the Americas) and the Argentine Embassy, was a commemoration of the bi-centenary anniversary of Britain’s invasion of Buenos Aires in 1806. The auditorium was full with a noticeably large Argentine contingent. What better way to spend a Friday afternoon reliving the accounts of one Argentina’s proud nationalistic moments in history, moreover, one that involved the catastrophic defeat of the British. The Argentine ambassador welcomed the guests, and proceeded in a highly diplomatic fashion to paint a rosy picture of Anglo-Argentine relations, taking an obviously large bypass around the misfortunate events of 1982. Though I’m sure much can be gleaned from his phrasing of how the UK came to acquire the Falkland’s in the first place with the use explicit use of the term “invasion”. Thereafter two prominent Argentine historians gave their impression of the importance of Britain’s invasion of Buenos Aires.

A notable point about the invasion was that it was never officially sanctioned by the British government. It was more of a rogue operation by a couple of maverick British Navy officers. In that sense it resembled the highly successful conquest policy of the Spaniards and its swashbuckling conquistadores. So whilst the venture was initially a success with Buenos Aires being captured, it merely succeeded in stirring a hornet’s nest and an Argentine militia soon had the British forces on the run. Ultimately this set in motion the desire for an independent Argentina in 1816. Strangely though, the whole British invasion is hardly mentioned in our history books, a mere footnote at most.
But I don’t want to bore you any more with too much historical information. Thankfully the talk didn’t linger on for too long, much to the satisfaction, no doubt, for the rest of the audience as well. An extravagant wine reception to be put on by the Embassy awaited and most Argentines were equally itching to find their way to the nearest TV screen to enjoy Argentina’s thumping of France in the rugby world cup (soon we're going to have world cup defeats in rugby to those accumulated in football to our list of grievances).

Yet More Manipulated Figures - this time in Argentina

As mentioned in my previous post, one shouldn't always take at face value economic statistics, especially when they enable the ruling powers of the day to revel in the data's overwhelmingly positive outlooks. Last week Cuban economist Carmelo Mesa-Lago warned us about the significant economic growth figures coming out of Cuba, and suggested the various ways in how they could have been 'manipulated'. Well today I came across the following article, "Will Cristina Head Off Another Crisis?" The articles relates, as in a similar fashion to the reliability of Cuba economic data, to the reliability of Argentina economic statistics and as to whether or not the Argentine government is taking increasing liberties with regards to the compilation of such statistics (http://news.bbc.co.uk/1/hi/business/7035500.stm).

Despite Argentina's impressive growth in the recent years, it can be said that President Kirchner has taken a very hands-on and at times quite unorthodox approaches as a means to boost growth and curb inflation. For instance during my stay in the country, Kirchner encouraged a nation-wide boycott of various international petrol companies (most notably Shell). He saw their price increases as highly detrimental to his own attempts curb to inflation.
Now it seems fiddling with official economic statistics may be his latest of weapons to curb inflation. So whilst 'official' inflation rates stand at 9%, many believe it actually to be as high as 15%-20%. Who to believe? Well according to one economist, "since January, when the government doesn't like what the official figures are telling it - it decided basically to modify those figures." And these can never be too promising when the actual institute for the collection of economic data in Argentina (INDEC) actually start demonstrating themselves protest over this supposed government interference.

Aside from the manipulation of statistics the BBC article quite rightly highlights other pressing issues which can be easily forgotten amidst the figures of seemingly impressive economic growth. Economic growth means little when it's poorly distributed. An example of which can be seen in Argentina's southern oil-rich province of Santa Cruz. Violent labour disputes continue to highlight the disaffection towards the regional government and its ability to distribute the benefits of the oil boom. An in the far north, in the province of Chaco, people continue to be dying of hunger and living in houses made of mud and sticks and without access to running water. Furthermore the article draws or attention to how the sudden rise in genetically modified soya in Chaco, whilst enabling short-term gains, will likely lead to vast tracts of lands being left barren due to the soils' lack of nutrients, something that will prove highly detrimental for the land in the long-term.

So whilst the signs of economic growth may be evident to see for those stuck in the splendour of downtown Buenos Aires, or for those who limit themselves to looking at GDP growth statistics - whether you believe them or not - all isn't as rosy as it seems.