Latin America and Caribbean (LAC) GDP is projected to grow by 2% in 2024 and 2.5% in 2025,
This is according to the 16 April report of IMF.
Brazil’s growth is expected to be 2.2% and 2.1% while Mexico’s growth is likely to be 2.4% and 1.4% in 2024 and 2025 respectively.
Argentina is expected to face economic contraction of 2.8% in 2024 but bounce back to a positive growth of 5% in 2025
Guyana will keep up its dream run of exceptional growth with 34% in 2023 and 19% in 2025, thanks to the oil bonanza. The country has grown by 159% in the last four years from 2020 to 2023.
Dominican Republic will grow by 4.6% and and 4.3% in 2024 and 2025.
India’s growth estimate is 6.8% and 8.5% in 2024 and 2025.
China’s growth projection is 4.6% and 4.1% in the two years.
The average inflation of LAC region is projected at 12.7% in 2024 and 6.5% in 2025. Exceptions are Argentina and Venezuela. Argentina’s inflation will be 149% in 2024 and 45% in 2025. Venezuela’s inflation will be 160% in 2024 and 150% in 2025.
More in https://www.imf.org/en/Publications/WEO/Issues/2024/04/16/world-economic-outlook-april-2024
Chile, an authentic laboratory for democratic experiments
In a referendum held yesterday, 56 percent of the Chilean voters defeated a draft centre-right constitution.
Ecuador elects a well-qualified and wealthy but millennial and moderate Daniel Noboa as President - October 17
Panama Canal traffic affected by low water level due to drought - August 23
Panama Canal Authority has reduced the number of ships allowed to pre-book transit due to low water levels caused by drought. There are 154 commercial vessels waiting to cross the Panama Canal, with an average wait time of 21 days.
Latin America could become this century’s commodity superpower
-The region is the world’s largest net food exporter, providing 60% of the world’s supply of soyabeans and more than 30% of maize, beef, poultry and sugar.
-It supplies more than a third of the world’s copper, used in wiring and wind turbines, and half of its silver, a component of solar panels.
-It holds vast deposits of critical minerals and metals. Despite mining it for decades, Chile and Peru retain 30% of the world’s exploitable reserves of copper.
-It is home to almost 60% of known lithium. Bolivia has tin, used as a solder in electrical components. Brazil has graphite, another battery metal.
-The metals are often easier to extract in Latin America than elsewhere. It is cheaper to get lithium by evaporation than to drill it from rocks, as is done in Australia and China. Brazil’s magnetic rare earths lie close to the surface.
- A record 60 bn barrels of oil was found across the region in the 2010s; another 10bn have since been discovered. Together Argentina, Brazil, Guyana and Mexico could produce 11m barrels per day by 2030.
Source: Economist
Latin America is set to become a major oil producer this decade
About a quarter of the incremental supply till 2028 will come from Latin America and especially from Brazil, Guyana and Argentina.
Guyana’s production is expected to reach a million barrels per day in the next few years.
Petrobras of Brazil plans to spend nearly half of its $6bn exploration budget over the next five years on the equatorial margin, an area in northeastern Brazil near Guyana. The government expects the area to hold upwards of 10 bn barrels of recoverable oil.
Brazil and Guyana can produce oil profitably at $35 per barrel, less than half the price of a barrel today
Latin America has the second-largest proven oil reserves in the world after the Middle East
Source: Economist
Latin America and Caribbean region is projected to grow its GDP by 1.5% in 2023, according to the June 2023 report of the World Bank.
Highlights of the report:
Brazil's growth is expected to slow to 1.2 percent in 2023, with a slight pickup to 1.4 percent in 2024.
Mexico's growth rate is projected to moderate to 2.5 percent in 2023 and continue growing by 1.9 percent in 2024.
Argentina's output is projected to fall in 2023 to a negative 2 percent and then grow by 2.3 percent in 2024 as the economy recovers from this year’s major drought that has impacted its agricultural production.
Colombia's growth is expected to weaken to 1.7 percent in 2023, with a pickup to 2 percent in 2024.
Chile is likely to experience a contraction of 0.4 percent in 2023, followed by 1.8 percent in 2024.
Peru's growth in 2023 is projected at 2.2 percent, with a slight increase to 2.6 percent in 2024.
Central America's growth is expected to slow to 3.6 percent in 2023, picking up slightly to 3.8 percent in 2024.
The Latin American prospects are not that bad in the context of the slow down of the global economy to 2.1% growth in 2023 and a tepid recovery in 2024, to 2.4 %.
Good news... India stands out with the highest growth among the major economies of the world with 6.3% in 2023, 6.4% in 2024 and 6.5% in 2025.
China's growth is projected to be 5.6% in 2023, 4.6% in 2024 and 4.4% in 2025.
The growth of US will be 1.1 % in 2023 and 0.8% in 2024.
European Union will grow by 0.4% in 2023 and 1.3% in 2024
more in the World Bank report
https://openknowledge.worldbank.org/server/api/core/bitstreams/9891892a-bc69-46fa-8ecc-e58b9fa019e8/content
Conservative Colorado party comes back to power in the elections in Paraguay
In the elections held on Sunday, Santiago Pena of the ruling Colorado party got elected as president. The elections were peaceful and the results were accepted by the losers promptly unlike what happened in US or Brazil.
The victory of the ruling Colorado party stands out against the recent trend of anti-incumbency results in Latin America. The right-wing Colorado party’s win also goes against the regional trend of election of Leftists to presidencies of many countries in the region.
Last year, India’s exports to Paraguay were 211 million dollars and imports 16 million. The trade will go up in the coming years with the recent opening of Indian embassy in Paraguay.
More in my blog Conservative Colorado party comes back to power in the elections in Paraguay
In the elections held on Sunday, Santiago Pena of the ruling Colorado party got elected as president. The elections were peaceful and the results were accepted by the losers promptly unlike what happened in US or Brazil.
The victory of the ruling Colorado party stands out against the recent trend of anti-incumbency results in Latin America. The right-wing Colorado party’s win also goes against the regional trend of election of Leftists to presidencies of many countries in the region.
Last year, India’s exports to Paraguay were 211 million dollars and imports 16 million. The trade will go up in the coming years with the recent opening of Indian embassy in Paraguay.
More in my blog
Brazil has a research project to produce hydrogen from ethanol
Brazil proposes to do research for production of hydrogen from ethanol for using as fuel in cars. There is going to be collaboration between the University of Sao Paulo, Toyota, Shell, Raizen (ethanol producer) and Neuman and Esser, a German firm working on energy solutions with hydrogen.
Brazil is a global pioneer and leader in the use of sugarcane ethanol as fuel for cars. The country achieved this in the seventies by a collaborative project between car manufacturers, ethanol and sugar plants and oil companies in the seventies. Using ethanol, Brazil has reduced petrol consumption by 50%.. Petrol and ethanol are sold through separate pumps in the same petrol stations. The petrol is already blended with 20% ethanol.
Ethanol is less polluting than petrol and its extensive use has strengthened the Brazilian sugar and ethanol industry and added to the income of farmers. Win-win for all the stakeholders.
Indian government has started mandatory blending of 10% ethanol. The target is 20% by 2025. But the Indian oil companies, uninterested in the ethanol programme, do the blending slowly and reluctantly. India should learn from Brazil’s success story.
Argentina’s inflation has reached three digits at 102.5%, the highest since 1991.
The Argentine government has imposed price controls on 1700 essential and food items. The Central Bank of Argentina has raised interest rates to a staggering 75%. But even these strong measures have not been able to rein in inflation.
The other Latin American country with 3 digit inflation is Venezuela.
The Argentine currency has been depreciating steadily. While the official exchange rate is 1USD= 202 pesos, the black market rate is double of that. The Argentine government has imposed severe exchange controls and introduced several different exchange rates for exporters of soy and wine as well as tourists.
Due to shortage of foreign exchange, the government has difficulties in servicing the large external debt including from IMF.
Of course, these problems are not unfamiliar to Argentines who have survived more serious crises in the past and are always prepared for the cycle of crisis from time to time..
Pity.. The country was one of the top ten richest countries in the world in 1900s and has the potential to become one in the future too. It has abundant agricultural, mineral, energy and natural resources besides well-educated human resources.
IIC Conference on Latin America 20-22 February
India International Centre, New Delhi is organising the conference with scholars, diplomats and literary personalities from India and Latin America.
Scholars, writers, historians and poets from 12 out of the 19 Latin Americans are participating in the conference. They are from Brazil, Mexico, Argentina, Colombia, Chile, Peru, Venezuela, Guatemala, Dominican Republic, Costa Rica, Cuba and Panama.
The conference is open to the public. Details of the programme in the IIC website..
Inflation: a chronic disease of Argentina
Argentina’s inflation reached 94.8 percent in 2022, the highest since 1991.
According to a report, the price rice in 2022 for milk was 320%, cooking oil 456%, sugar 490%, clothing 120% and hotel tariff 109%.
Inflation has remained stubbornly in double digits in the last two decades. It is not expected to go away soon. In 2023 it is projected to be around 60% by the government.
Besides inflation, the country has other serious issues of burden of external debt, shortage of foreign exchange and poverty.
It has been estimated that 36.5 percent of Argentina's 47 million population live in poverty, including 2.6 million in extreme poverty.
The only good news is that Argentina's GDP grew by around five percent in 2022 and 10.3% in 2021. The growth rate is projected to be 2% in 2023.
GDP growth projection in 2023
GDP growth of Latin America and the Caribbean is projected to slow from an estimated 3.6 percent in 2022 to 1.3 percent in 2023, before recovering somewhat to 2.4 percent in 2024, according to the just released January 2023 report of World Bank.
Brazil’s GDP is expected to expand by just 0.8 percent in 2023 and increase to 2% in 2024, following growth of 3 percent in 2022.
Mexico is projected to grow 0.9 percent in 2023 and 2.3% in 2024 after 2.6 percent in 2022.
Argentina’s GDP is forecast to expand 2 percent in 2023 and 2024, following stronger than expected growth of 5.2 percent last year
Colombia is projected to grow by 1.3 percent in 2023, from 8 percent in 2022, before recovering somewhat to 2.8 percent in 2024.
Chile’s GDP is projected to contract by 0.9 percent in 2023, before rebounding by 2.3 percent in 2024.
In Peru, steady growth of 2.6 percent a year is expected in 2023 and 2024 after an estimated growth of 2.7% in 2022.
2022
2G ethanol production in Brazil
Second Generation ethanol (2 G ethanol) is produced from sugarcane waste such as straw and bagasse.
Brazilian company Raízen announced this week R$6 billion investment to build five new second-generation ethanol plants over the next five years. The production of each unit will be 82 million litres per year. They are supplying the 2G ethanol on longterm contract basis to Shell which will export it US and Europe where it will fetch a higher price due to its lower carbon footprint.
Ethanol from Agave – Brazil explores
The University of Campinas (Unicamp) of Brazil and Shell are doing a joint study for production of ethanol from agave. The project is based on the work of a master’s degree student at Unicamp.
Agave has a high energetic potential for ethanol production in semi-arid regions, with productivity as high as that of sugarcane. Agave can resist unpredictable weather because it can survive up to several years without rain, unlike sugarcane, which is more susceptible to climate variations.
There is potential for 6-10 billion liters of agave ethanol, against 35 billion liters of sugarcane ethanol produced per year in the country.
Agave can be planted in 2 million hectares in the semi-arid region. This is just 2% of the total area of 100 million hectares of arid land. The cultivation of agave can transform the Brazilian hinterland.
Brazil is the global leader and pioneer in the production of sugarcane ethanol used as fuel for vehicles. The Brazilians are in the vanguard of research and production of biodiesel and related products.
More...https://valorinternational.globo.com/agribusiness/news/2022/11/09/shell-bets-on-agave-as-alternative-energy-source.ghtml
Lula wants to review Mercosur-EU Trade text of FTA but European Union says “No”
President-elect Lula said in his victory statement “Brazil will resume relations with the European Union on new bases. It is not interested in trade agreements that condemn Brazil to be an eternal supplier of commodities”.
In an article he had earlier written for Le Monde he said “improving the terms of the Mercosur-European Union agreement will allow us to increase our trade, deepen the bonds of trust and strengthen the defense of our common values.”
But EU’s answer is “no” and they say, “focus should now be on working towards the implementation of the negotiated understanding”.
The FTA negotiations had gone on for 20 years and concluded in 2019 but not signed yet.
The annual Chinese lending to Latin America and Caribbean has come down from a peak of 34.5 billion US Dollars in 2010 to zero in 2020 and 2021.
The chief lenders were the China Development Bank (CDB) and China Export-Import Bank (Ex-Im Bank).
The lending has declined steadily to 12.5 bn in 2016, 6.6 bn in 2017, 2.1 bn in 2018 and 1.9 bn in 2019 before hitting zero in 2020 and 2021.
The Chinese seems to have reached a saturation point.
The top four recipients of the credit are: Venezuela- 62.5 bn, Brazil-30.5 bn, Ecuador-18.2 bn and Argentina- 17 bn. Of these Ecuador has done some restructuring of the Chinese debt this year. The Chinese receive oil from Venezuela and Ecuador as repaymen
Venezuela will see a spectacular GDP growth of 12% in 2022
…and an impressive 5% in 2023, according to this week’s report from the UN Economic Commission for Latin America and Caribbean (ECLAC).
Other highlights of the report:
Latin America will have a GDP growth of 3.1 % in 2022 and 1.3% in 2023.
Brazil 2.6% and 1%
Mexico 1.9% and 1.1%
Argentina 3.9% and 1%
Colombia7.7% and 1.9%
Peru 2.7% and 2.2%
Chile’s GDP will grow in 2022 by 2.2% but will contract by 0.9% in 2023
Latin American economic performance is understandable given the global economic conditions of recession, inflation, energy crisis and political volatility.
more in https://www.cepal.org/sites/default/files/pr/files/proyecciones_2022-2023_in.pdf
Mexico and Brazil defy the dollars’s global strength
Surprising.. but welcome news…
So far this year, Mexico’s peso is up 2.5% against the dollar, while the Brazilian real has strengthened more than 7%.
The resilience of Brazilian and Mexican currencies are in sharp contrast to the euro, Japanese yen, British pound and Chinese yuan which have all depreciated by double-digits against the dollar.
The central banks of Mexico and Brazil had taken some effective measures early on to control inflation by raising their lending rates much before the US Federal Reserve.
Besides Mexico and Brazil, many other central banks in Latin America have become more autonomous and pillars of policy stability, despite political volatility. Peru, for example, has had the same central bank governor for the past 16 years, while rotating through five presidents in the past four years.
More in https://www.wsj.com/articles/mexico-and-brazil-defy-the-dollars-global-strength-11664888309?mod=world_major_3_pos2
Ecuador restructures Chinese debt - September
Ecuador has reached a deal with China this week to restructure $4.4 billion of outstanding debt.
Ecuador is the third largest recipient ($18 bn) of Chinese credit to Latin America after Venezuela ($62.5 bn) and Brazil ($30.5 bn)
More in my blog
Summit meeting of Andean Community of Nations (CAN) held on 29 August in Lima,
In the summit, the presidents of the four member states (Bolivia, Colombia, Ecuador and Peru) have called for Argentina, Chile and Venezuela to join the group.
CAN was created in 1969 as the Andean Pact by Bolivia, Chile, Colombia, Ecuador, and Peru. Venezuela joined in 1973 but President Chavez quit from the group in 2006 angry with the FTAs signed by Peru and Colombia with the US. Chile left the group in 1976 when the country was under the brutal military dictatorship of Pinochet. It rejoined in 2007 as an associate member.
CAN was the best institutionalized and well established among the regional groups in Latin America. It has its own Secretariat, Court of Justice, Parliament and Development Bank (CAF) which is a solid Triple A rated bank with headquarters in Caracas. The Group had Free Trade Area and Open Skies policy for aviation among other integration projects. In early 2000s, CAN and Mercosur started talks for an FTA between the two groups.
The 2022 Summit has revived CAN which remained dormant in recent years due to political changes. The new leftist presidents of Colombia, Peru and Bolivia are keen to strengthen CAN and expand it. The centre-right but moderate Peruvian president Lasso is also on board for revival of the group.
Venezuela and Colombia restore diplomatic relations
The South American neighbors have exchanged ambassadors for the first time since 2019. The normalization process will include the full reopening of the border, which has remained largely closed to vehicles. This will open up trade and movement of people. More importantly it will give a much needed lifeline for Venezuela.
In 2019, Colombia's former President Ivan Duque cut off ties with Caracas after refusing (as part of the US-led isolation of the Maduro government) to recognize Maduro's election. Embassies and consulates in both countries were closed and flights between the two countries were grounded. In addition, the border itself remained completely shut between 2019 and late 2021.
Gustavo Petro, the new leftist President of Colombia sent a warm letter to President Maduro highlighting friendship between the two countries and signed the letter, ”loyal and good friend”.
Petro’s gesture is a slap in the face of US (under Trump administration) which had announced a 15 million dollar bounty on the head of President Maduro based on some cooked up drug charges. Along with Maduro, several ministers, generals, judges and officials of Venezuela were also indicted and a large bounty of 55 million dollars was announced by the cowboy regime of Trump. Indictment of a ruling head of state is highly unusual and even US laws do not permit it. But the Gringos pretended that Maduro was not a real president and it was their puppet Guaido was the interim president. Now the Americans are quietly ditching Guaido and are making overtures to Maduro administration requesting them to produce and export more oil to make up for the shortfall in the global oil market caused by the sanctions on Russia.
The priority for Colombia and Venezuela now is the return of the two million Venezuelan refugees in Colombia. Most of them are economic refugees while some have got political asylum there. It is worth noting here that there were about a million plus Colombians who had come to work in Venezuela when the country was prosperous during high oil prices. The leftist Venezuelan government was also giving overt and covert support to some of the Colombian guerilla groups. Now there will be no such support and this will put pressure on the guerillas to move towards peace deal with the government of Petro.
So the resumption of Colombia-Venezuela diplomatic relations is a win-win for the two countries. But it is a clear a loss-loss for the American policy of divide-and-rule as well as their plans for regime change in Caracas.
Venezuela’s GDP will grow by an incredible 10% in 2022
This will be the highest growth in the whole of Latin America in 2022.
This is the first time that the country is seeing a positive GDP growth since 2014. In the period 2014 to 2021, the GDP had shrunk every year consecutively. The GDP contraction was 30% in 2020.
More in my blog http://latinamericanaffairs.blogspot.com/
Brazilian digital bank Nubank has acquired 1 million cryptocurrency customers in Brazil
The bank started its crypto offering at the end of June.
Neobank offers Bitcoin and Ethereum, the most popular cryptocurrencies, to its entire base of 60 million users. Its goal is to popularize access to crypto-assets through its mobile app.
Its clients can trade crypto at a 0.12% commission, with a minimum order of BRL 1.00 (US$ 0.20) and no added spreads, markups or custody fees.
Nubank CEO and co-founder David Vélez says, “crypto is a growing trend in Latin America,
Vastu practice in Argentina
Argentine architect Augustin Gutierrez has specialized in Vastu Shastra for the last ten years. He calls Vastu as the yoga of houses. He has studied it in India. He claims that even the Roman Colliseum, Greek Parthenon, Tajmahal and the headquarters of Microsoft, Intel, Boeing and NASA have been built according to Vastu principles. He provides even online consultation on vastu principles on orientation of house, decoration, furniture arrangement, use of colours, empowering of the house with the five natural elements and mantras for for maintenance of the energy of the house. He publishes a newsletter and is active in social media.He also practices and teaches Yoga, meditiation and the Art of Living techniques of respiration.
His website https://vastu.com.ar/
Leftist wins the presidential elections of Colombia and confirms the resurgence of Pink Tide in Latin America
Leftist and former Marxist guerilla group member Gustavo Petro won the presidential elections of Colombia held on Sunday. This is the first time in recent history that a Leftist has become President of Colombia. Petro’s vice presidential candidate Francia Marquez, has also made history as the first black to become vice president.
Petro’s ascent to power has confirmed the resurgence of the Pink Tide in Latin America. Petro’s election and Lula’s expected victory in October this year will complete the Latin American circle of the left with all the seven largest and most important Latin American countries with the biggest markets This is a challenge to the interventionist inclinations of US which will stand isolated in the Americas.
The resurgent pink tide in Latin America is good news since the leftist governments, in general, seek closer cooperation and partnership with India to address common developmental challenges and would be more willing to collaborate with India on global issues with South-South solidarity.
More in my blog http://latinamericanaffairs.blogspot.com/
Argentine Inflation is projected to reach 70% in 2022 from 50% last year
Second highest in the region after Venezuela. The reasons for Venezuela's hyperinflation are understandable, given the internal mismanagement and external US economic sanctions.
But Argentina's inflation in double digits is persistent in the fifteen years. Even the centre-right President Macri ,who got 40 billion dollar IMF loan, could not contain the high inflation. It is said that Argentina has a pathological relationship with inflation..Pity..the country has so many brilliant economists and people with administrative skills..
Latin America’s GDP growth rate will come down in 2022
The April 2022 world economic outlook report of IMF says the Ukraine war will bring down the GDP growth of South America to 2.3 % in 2022 from 7.2% in 2021.
Central America’s growth will be down to 4.8% from 11%.
Brazil’s GDP will decrease to 0.8% in 2022 from 4.6% in 2021
Mexico’s GDP will decline to 2% from 4.8%
Argentina(10.2%), Colombia(10.6%), Chile(11%) and Peru (13%) who had shown impressive double digit growth in 2021 will see 4%, 5.8%,1.5% and 3% respectively in 2022
The only positive ( surprise !! ) increase will be in the case of Venezuela which will see a 1.5% growth in 2022 after GDP contraction of 1.5% in 2021.
India’s GDP growth will decline marginally to 8.2% in 2022 from 8.9% in 2021 while the global GDP growth will be down to 3.6% in 2022 from 6.1% in 2021.
Costa Rica elects a political outsider as President
Rodrigo Chaves Robles, a political outsider, won the Costa Rican Presidential election last Sunday. He had lived almost half his life outside Costa Rica and returned to the country in 2019 after working for 27 years at the World Bank. His opponent Jose Maria Figueres was a former president and son of a three-terms president. Figueres was the candidate of National Liberation Party, the largest and oldest party of the country.
Kerala University has started a Latin America Study Centre - 13 March
My interview to Mathrubhumi newspaper
Gabriel Boric, the 36 year-old millennial student activist, took over as President of Chile on 11 March.
In his inaugural address, he has promised to remove the unjust neo-liberal policies imposed by the Pinochet dictatorship and reiterated his intention to redistribute wealth. He has promised to reduce weekly working hours from 45 to 40 hours.
At the same time he is not going to impose his own vision on the country. He is realistic and pragmatic. He has said, ”fulfilling our goals will not be easy. we will face external and internal crises. we will make mistakes. we must amend such mistakes with humility, always listening to those who think differently”.
Although he is a leftist, he is critical of the leftist authoritarian regimes of Venezuela and Nicaragua.
Xiomara Castro sworn in as president of Honduras on 27 January.
She is the wife of ex-president Manuel Zelaya who was overthrown in a right wing coup in 2009. She is centre-left like her husband.
Latin America projected to grow by 2 percent in 2022
Latin America’s GDP is forecast to increase by 2% in 2022, according to the 12 January report of ECLAC ( UN Commission for Latin America and Caribbean). The region had grown by 6.25 in 2021 after the disastrous GDP contraction of 6.8% in 2020 and zero growth in 2019.
In 2022, Brazil is predicted to grow by 0.5%, Mexico by 2.9%, Argentina by 2.2%, Colombia by 3.7%, Peru by 3%, Chile by 1.9% and Central America by 4.5%.
The most pleasant surprise is Venezuela which is projected to grow by 3%. The country’s GDP had contracted successively since 2014.
Another welcome news..Venezuela’s inflation had come down 1946% in 2021 from 130060% in 2018.
Argentina’s inflation had gone up to 51% in 2021 from 34.1% in 2020 but down from the 52.9 % in 2019. Brazil’s inflation was 10.2% in 2021.
The region’s exports had increased to 1.212 trillion dollars in 2021 from 958 billion in 2020. Imports had also gone up to 1.145 trillion from 885 bn in 2020.
More info in ECLAC report https://repositorio.cepal.org/bitstream/handle/11362/47670/3/S2100697_en.pdf
2021
December
New Generation leftist, promising to bury Neoliberalism, is elected as President of Chile.
Gabriel Boric, the leftist candidate who won yesterday in the presidential elections of Chile, had promised to bury the Neo Liberalism imposed by the military dictator Augusto Pinochet.
Boric is the most left-wing President of Chile since President Salvador Allende was overthrown in 1973 by General Pinochet. The US supported the coup in the name of the ‘war on communism’. Boric’s victorious coalition includes the Communist Party of Chile. Allende should be smiling in his grave.
The peaceful elections and the graceful acceptance of defeat by the loser promptly have demonstrated yet again the strength and maturity of Chilean democracy.
With the election of Boric and the drafting of a new constitution, the stable democracy of Chile is poised to become a more inclusive and equitable democracy. This should be an inspiration for Latin America which has similar challenges of poverty and inequality.
More in my blog http://latinamericanaffairs.blogspot.com/2021/12/new-generation-leftist-who-promised-to.html
The significance of return of the Left in Honduras elections
Xiomara Castro de Zelaya, the socialist candidate, got elected as President of Honduras in the elections held on Sunday.
It is a sweet revenge for her husband Manuel Zelaya, who was overthrown from presidency by a rightwing coup in 2009, with the support of US.
It should give satisfaction to Lula, who tried to restore Zelaya’s presidency by defying the American hegemony in Central America and asserting Brazilian leadership of Latin America. The Americans and the right wing Honduran oligarchy beat Lula at that time but could not stop the return of the Left to power now
More in my blog
November
Light at the end of the tunnel for Venezuela?
In the regional and mayoral elections held on 21 November, President Maduro’s socialist coalition has won the majority of posts. The opposition won only a few since they were divided and weak. The election results have boosted the strength of President Maduro and discredited Juan Guaido, recognized as interim president by the US.
The economy has stopped its bleeding and started healing. Learning from its mistakes, the government has changed its strategy. It has opened the door for private sector business and relaxed import and price controls.
Venezuela’s dark days are over both on the economic and political front and the situation can only become better in the coming years.
More in my blog
Bitcoin City to be founded with a Bitcoin sovereign bond to be issued by El Salvador
El Salvador’s Maverick president Nayib Bukele has announced plans to build a volcano-powered “bitcoin city” financed partly by an issue of $1bn in sovereign bonds ( Bitcoin Bond) backed by the cryptocurrency. The $1 billion that the initiative aims to raise will be divided into two parts. The first part will be used to purchase a $500 million allocation of bitcoin, and the second $500 million will be used to build bitcoin-specific mining and power infrastructure. The tokenized bond will be available to a number of users in the world, that will have access to invest in small amounts of even $100 dollars. El Salvador would partner with Blockstream and use its liquid network to issue the Bitcoin bond.
The Bitcoin City would have no property, income or capital gains taxes except value added tax (VAT).Its infrastructure and other costs will be funded by a sales tax and money raised by the bond issues. The city would include residential and commercial areas, services, museums, entertainment, bars, restaurants, airport, port, rail - everything devoted to Bitcoin. The city will be circular to represent the shape of a large coin and will be built in the south-eastern region of La Unión. The site would take advantage of the Conchagua volcano's geothermal energy to power Bitcoin mining.
In September, El Salvador introduced Bitcoin as a legal tender, alongside the US dollar. At the time, the government released a new digital wallet app, giving away $30 (£22) in Bitcoin to every citizen. More than 200 new cash machines were installed across the country.
This is yet another experiment by the tech-savvy millennial president Bukele. If the project fails, his successors will have the burden of debt and obliged to pay the bondholders, a story common in many countries of Latin America.
In the midterm elections held on 14 November, the ruling Peronist Coalition (Frente de Todos) lost some seats as expected but not as badly as the centre-right opposition (Juntos por Cambio) hoped.
In the Senate, the Peronists lost majority after losing 6 seats. Now the government will have a bloc of 35 senators to the opposition’s 31, with the other six belonging to various provincial forces. In the Chamber of Deputies, the Frente will have 118 seats as against Juntos with 116 seats, while the rest has gone to other parties.
In Buenos Aires City, the opposition – which has controlled the capital since 2007 – once again won by a large margin with 47 per cent of the vote against 25.1 percent for the Frente.
In the province of Buenos Aires, which accounts for more than a third of the total electorate of the country, Juntos won with 39.81 percent as against the 38.53% of the Peronists.
The setback for the Peronists is good news for the country. Now they cannot impose their leftist partisan agenda but have to compromise and work with those outside the leftist coalition.
President Ortega’s reelection victory is a betrayal of democracy and socialism
President Daniel Ortega, won a fourth consecutive term in the elections held in November 2021. His wife Vice President Rosario Murillo, will continue as Vice President.
Ortega had prevented opposition candidates from contesting by imprisoning seven would-be presidential candidates including Ms. Chamorro who had higher favorability rating of 53% approval, compared with 39% for Ortega. Ms. Chamorro is the daughter of Violeta Barrios de Chamorro, who defeated Mr. Ortega in the 1990 presidential elections.
Ortega is in power continuously since 2007 after removing the constitutional term limit. He was earlier president from 1985-90 and part of the ruling Junta from 1979 to 1984. He and his wife Rosario are running the country like a family dynasty similar to the Somoza dynasty which ruled from 1937 to 1979.
Ortega was part of the glorious Sandinista revolution which overthrew the Somoza dynasty in 1979. He was admired when he accepted the defeat in the 1990 election gracefully and waited for his time till 2007. But since then he has eroded democracy by his authoritarian way of rule. He has promoted his wife and children to positions of power. Most of the other leaders of the Sandinista revolution have turned as opponents to Ortega’s family regime.
US, Europe and some Latin American countries including Costa Rica have condemned the elections as a fraud. The US has imposed sanctions on Nicaragua and personally against Ortega’s family members. Due to the political oppression and economic difficulties, over 100,000 Nicaraguans have migrated to Costa Rica as refugees and thousands have sought asylum in the US.
Nicaragua has joined Venezuela as another sham democracy in Latin America. Both the Bolivarian revolution of Venezuela and the Sandinista revolution of Nicaragua had started off with lofty socialistic ideals. Both have now betrayed their ideals and given a bad name to socialism and revolution, besides ruining the two countries.
Bitfarms, yet another Argentine unicorn
Bitfarms, the company founded by two Argentine founders Emiliano Grodzki and Nicolás Bonta in 2017, has become the ninth Argentine start-up to reach unicorn status, following the success of other Argentine unicorns such as Mercado Libre, Globant, Despegar and OLX.
Bitfarms runs vertically integrated mining operations and operates five industrial scale facilities with 21500 machines located in Québec, Canada using 69 MW of hydroelectricity. It is listed both on Wall Street and the Toronto Stock Exchange
The company has announced that it will set up a new facility in the duty-free zone of Tierra del Fuego in Argentina. It plans to install in early 2022 over 55,000 machines which will use up to 210 megawatts of electricity. With a favourable year-round climate, the facility in Patagonia does not require expensive liquid immersion cooling to keep the miners cool and operating optimally. The miners will be cooled with fans, similar to how they are cooled in their facilities in Québec. It is also intended to provide geographic production diversification to reduce risk.
Bitfarms has also announced another plan to set up a mining facility in Paraguay ( country with power surplus) which will operate with 8000 machines using 10 MW of hydroelectric power.