[NYTr] Latin America 2008: A year of definitions?
 
Date: Thu, 10 Jan 2008 04:26:45 -0600 (CST)


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Progreso Weekly - Jan 10, 2008
http://progreso-weekly.com/index.php?option=com_content&task=view&id=288&Itemid=1

Latin America 2008: A year of definitions?

By Eduardo Dimas

The prestigious Uruguayan journalist RaC:l Zibechi says 2007 was "a
hinge year," because there were many movements, reshufflings, advances
and retreats that produced no appreciable political or economic
definitions.

For their part, my renowned colleagues VC-ctor Ego Ducrot and Pablo
Ramos of the APM news service (Mercosur Press Agency) view with
relative optimism the political and economic performance of the region
in the year now dawning.

Without trying to be pessimistic, it seems to me that at least the
growth in the region's gross domestic product (GDP) can be affected by
the situation in the rest of the world, especially if a recession of a
certain magnitude occurs in the United States, as is being announced.

As to the political aspect, the region has accumulated a certain amount
of tension that could provoke some difficult, even grave, situations in
the almost 12 months left until 2009. I am thinking above all about
Bolivia, where the political confrontation between the oligarchy and
the government of Evo Morales could lead to the secession of the
so-called Half Moon provinces, to a civil war or coup d'C)tat, or at the
very least to a radicalization of the process led by Morales. That will
depend on the attitude assumed by the Bolivian people, especially the
indigenous people.

One issue at a time. During 2008, we witnessed new steps in the
integration of Latin America, with the creation of the Bank of the
South by seven governments -- some of them with the largest GDPs in the
region -- and the strengthening of entities such as PetroSur,
PetroCaribe and the Common Market of the South (Mercosur).

However, Venezuela's admission to Mercosur as a full member was not
possible, despite the pressure from the governments of Argentina and
Uruguay and Lula da Silva himself. The oligarchical right of the
Brazilian parliament has refused to approve it, even after it was
approved by the legislatures in Argentina, Uruguay and Paraguay. 

It is unquestionable that Venezuela's admission would give Mercosur a
greater economic sheen and independence, because the bloc would be
guaranteed a supply of crude oil for decades. Political differences and
pressures from the White House have delayed approval in Brazil, and the
same could occur in Bolivia and Ecuador.

In the economic aspect -- also in the political aspect -- aside from
the advances in integration, we had an opportunity to experience the
differences in viewpoints with regard to the future of Latin America.

Venezuela, Bolivia and Ecuador are following a nationalist, almost
socialist course in their economic development. Some -- like Argentina,
Uruguay, Paraguay and Brazil -- maintain their principles of free
enterprise (nationalist principles, in a way) while criticizing the
neoliberal model and specific independent policies of the centers of
world economic power, especially the United States.

Others -- like Chile, Peru, Colombia and most of Central America, with
the exception of Nicaragua -- chose to tighten their links with the
United States through the signing of Free Trade Agreements (FTAs).
Mexico signed an FTA many years ago. Negotiations with the European
Union advanced but not at the speed the European leaders might have
wished.

Mercosur signed a free-trade accord with Israel, something that drew
attention to the power that transnational corporations have over the
commerce of their members (Brazil, Argentina, Uruguay and Paraguay),
because signing an accord of that type with Tel Aviv is the same as
signing it with the United States.

In other words, most of the Latin American governments have a
neoliberal vision of the economic future of their countries.

Of course, that strengthens the position of the United States and the
national oligarchies, and is contrary to regional integration. Needless
to say, it is a class-driven and ideological vision that does not
envision domestic development and prefers to keep Latin America under
the Empire's domination. 

In recent years, the region has seen important growth in its GDP as a
result of the high prices of the raw materials it exports. That has
allowed a certain economic improvement in the poorer sectors of the
population. The number of people living below the poverty line has
decreased, according to the Economic Commission for Latin America
(ECLA/CEPAL.)

But the truth is that most of the wealth acquired has remained in the
hands of the transnationals and the oligarchies. Several countries have
increased their dollar reserves abroad to a spectacular degree, yet
their peoples have seen no substantial change in their standards of
living.

The question that needs to be asked is what will happen in the event
that the predicted economic recession in the U.S. develops and the rest
of the world (China, India, Japan, the European Union) has no need for
so many commodities and the prices drop, something that is perfectly
possible.

To depend on the price of raw materials is not exactly healthy for
underdeveloped economies, because they are exposed to the vagaries of
the markets in the great powers. Besides, most of the reserves of Latin
American countries are kept in dollars. What will happen to those
countries if the U.S. currency continues to drop, as some economists
predict?

It is evident that the economic growth experienced by Latin America in
recent years might end soon. The attendant increase in poverty would
fuel the domestic contradictions, which have been attenuated but not
eliminated.

The struggle for economic and social vindication is being fought today
in Peru, Chile, Brazil, Paraguay, Argentina, Colombia and most of the
Central American countries and Mexico. In other words, we cannot rule
out that 2008 will be a year of strong social conflicts, as well as an
increase in the efforts of the oligarchies and the U.S. to halt the
social movements.

At the start of this article, I spoke of Bolivia and the possible
political scenarios there in 2008. It is not unreasonable to think that
Venezuela and Ecuador may see destabilizing actions promoted by the
forces that reject change. In fact, those actions are already
occurring. In all cases, the follow the same pattern used against the
government of Salvador Allende in Chile, with some variants and
shadings, of course.

And we cannot forget that this is an election year in the United States
and the last year (God willing) of W. Bush's tenure in the White House.
It is very probable that he will try to achieve some success in Latin
America to atone for the long chain of failures he has harvested in
his seven years in office.

So, if 2007 was "the hinge year," 2008 could be a year of definitions,
of "doors" that open toward the integration, development and
independence of Latin America. But also of doors that close and keep
the region from continuing on the road that is most convenient for it.

That will depend, as I said in the case of Bolivia, on the position
assumed by the people of Latin America who, in recent years, have
demonstrated a rise in consciousness that has led them to topple
governments, expel transnationals, prevent coups d'C)tat and fight for
their own true interests. Time will tell. 

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