Monthly Archives: November 2012

Economist – The rise of Mexico

America needs to look again at its increasingly important neighbour

Nov 24th 2012 | from the print edition

NEXT week the leaders of North America’s two most populous countries are due to meet for a neighbourly chat in Washington, DC. The re-elected Barack Obama and Mexico’s president-elect, Enrique Peña Nieto, have plenty to talk about: Mexico is changing in ways that will profoundly affect its big northern neighbour, and unless America rethinks its outdated picture of life across the border, both countries risk forgoing the benefits promised by Mexico’s rise.

The White House does not spend much time looking south. During six hours of televised campaign debates this year, neither Mr Obama nor his vice-president mentioned Mexico directly. That is extraordinary. One in ten Mexican citizens lives in the United States. Include their American-born descendants and you have about 33m people (or around a tenth of America’s population). And Mexico itself is more than the bloody appendix of American imaginations. In terms of GDP it ranks just ahead of South Korea. In 2011 the Mexican economy grew faster than Brazil’s—and will do so again in 2012.

Yet Americans are gloomy about Mexico, and so is their government: three years ago Pentagon analysts warned that Mexico risked becoming a “failed state”. As our special report in this issue explains, that is wildly wrong. In fact, Mexico’s economy and society are doing pretty well. Even the violence, concentrated in a few areas, looks as if it is starting to abate.

Mañana in Mexico

The first place where Americans will notice these changes is in their shopping malls. China (with more than 60 mentions in the presidential debates) is by far the biggest source of America’s imports. But wages in Chinese factories have quintupled in the past ten years and the oil price has trebled, inducing manufacturers focused on the American market to set up closer to home. Mexico is already the world’s biggest exporter of flat-screen televisions, BlackBerrys and fridge-freezers, and is climbing up the rankings in cars, aerospace and more. On present trends, by 2018 America will import more from Mexico than from any other country. “Made in China” is giving way to “Hecho en México”.

The doorway for those imports is a 2,000-mile border, the world’s busiest. Yet some American politicians are doing their best to block it, out of fear of being swamped by immigrants. They could hardly be more wrong. Fewer Mexicans now move to the United States than come back south. America’s fragile economy (with an unemployment rate nearly twice as high as Mexico’s) has dampened arrivals and hastened departures. Meanwhile, the make-up of Mexican migration is changing. North of the border, legal Mexican residents probably now outnumber undocumented ones. The human tide may turn along with the American economy, but the supply of potential border-hoppers has plunged: whereas in the 1960s the average Mexican woman had seven children, she now has two. Within a decade Mexico’s fertility rate will fall below America’s.

Undervaluing trade and overestimating immigration has led to bad policies. Since September 11th 2001, crossing the border has taken hours where it once took minutes, raising costs for Mexican manufacturers (and thus for American consumers). Daytrips have fallen by almost half. More crossing-points and fewer onerous checks would speed things up on the American side; pre-clearance of containers and passengers could be improved if Mexico were less touchy about having American officers on its soil (something which Canada does not mind). After an election in which 70% of Latinos voted for Mr Obama, even America’s “wetback”-bashing Republicans should now see the need for immigration-law reform.

No time for a siesta

The least certain part of Mexico’s brighter mañana concerns security. This year has seen a small drop in murders. Some hotspots, such as Ciudad Juárez, have improved dramatically. A third of Mexico has a lower murder rate than Louisiana, America’s most murderous state. Nevertheless, the “cartels” will remain strong while two conditions hold. The first is that America imports drugs—on which its citizens spend billions—which it insists must remain illegal, while continuing to allow the traffickers to buy assault weapons freely. American politicians should heed the words of Felipe Calderón, Mexico’s outgoing president, who after six years and 60,000 deaths says it is “impossible” to stop the drug trade.

The second black spot is that Mexican policing remains weak. If Mr Peña is to keep his promise to halve the murder rate, he must be more effective than his predecessor in expanding the federal police and improving their counterparts at state level. That is just one of several issues that will test Mr Peña. He cannot achieve his ambition to raise Mexico’s annual growth rate to 6% by relying solely on export manufacturing. Upping the tempo requires liberalising or scrapping state-run energy monopolies, which fail to exploit potentially vast oil and gas reserves. Boosting Mexico’s poor productivity means forcing competition on a cosy bunch of private near-monopolies—starting with telecoms, television, cement and food and drink. That means upsetting the tycoons who backed his campaign.

This newspaper gave Mr Peña a lukewarm endorsement before July’s election, praising his economic plans but warning that his Institutional Revolutionary Party (PRI), which ran Mexico in an authoritarian and sometimes corrupt manner for most of the 20th century, has not changed much. Facing down interests within his own party may be Mr Peña’s hardest task. The head of the oil workers’ union is a PRI senator. The teachers’ union, which is friendly with the party, is blocking progress in education. A new labour reform has been diluted by PRI congressmen with union links.

Mr Peña, a good performer on the stump, should appeal beyond the PRI to a broad consensus for change among Mexicans. Time will tell if he measures up to the task. But the changes in Mexico go beyond the new occupant of Los Pinos. The country is poised to become America’s new workshop. If the neighbours want to make the most of that, it is time for them to take another look over the border.

Click here for original article.

Could Central American gangs usurp the role of Mexican cartels?

Could Central American gangs usurp the role of Mexican cartels?.

Costa Rica‘s attorney general has warned that with the decline of Mexico‘s powerful cartels, Central American gangs could rise and take control of criminal operations in the region – an extreme but not implausible scenario.

In a recent interview with El Universal, Costa Rican Attorney General Jorge Chavarria warned that Central America’s criminal groups could grow stronger and supplant their Mexican counterparts in the region if the Mexican cartels lose power.

“At the moment, the dominant groups are clearly Mexican. But if we look 10 years ahead, what will happen if in Mexico, the fight [against crime] has a positive effect from the point of view of the Mexican state?” Chavarria said. “That is how we have to look at it in order to see how we can avoid the consolidation of Central American organizations that could replace the Mexicans.”

The main candidates to step into the role of Mexican cartels are gangs in the “Northern Triangle” of GuatemalaEl Salvador, and Honduras. El Universal highlighted the Salvadoran Texis Cartel and Guatemalan groups the Mendozas and the Charros as among the most powerful.

Chavarria said that no Costa Rican cartels have been detected so far, but that authorities must work to pre-empt their emergence, adding, “What is very risky for us is that someone starts to develop a leadership and establish a Central American organization in the face of a vacuum [in criminal structures] as [could happen] in Mexico and Colombia.”

The decline of Mexican cartels may already be underway. Last month, US Assistant Secretary of State William Brownfield announced that Mexico’s larger drug trafficking organizations were “on the verge of collapse,” thanks to sustained pressure on their operations in the region. The majority of Mexico’s large gangs, from the Beltran Leyva Organization and Gulf Cartel to the Juarez and Tijuana Cartels are now shadows of their former selves, as analyst Alejandro Hope has set out.

Brownfield acknowledged that the crackdown on Mexico’s groups means a greater risk for Central America and the Caribbean.

As El Universal points out, Mexican groups such as the Sinaloa Cartel and Zetas currently use Central American gangs as operatives to launder money, infiltrate local police and traffic drugs. If these roles reversed, Central American cartels would have to increase their presence in Mexico. This would be more difficult than it was for Mexicans to move south, as the Mexican state has far stronger institutions that the Northern Triangle. Mexican groups were able to take advantage of largely ungoverned spaces in the isthmus — such as the north Guatemalan province of Peten — to conduct their operations.

If Central American gangs increase their stake in the trade, they could also bypass Mexico as a transit point and traffic drugs through the Caribbean, a favored route in the 1980s. Both US officials and Caribbean leaders have suggested that the shift back to Caribbean routes may already be happening thanks to sustained pressure on drug trafficking through Central America. If drugs arrived in the United States by sea, Central American traffickers would be able to increasingly cut Mexican cartels out of the supply chain.

As Chavarria noted, these scenarios are not likely to take place in the immediate future. While Mexican monolithic criminal groups may be disintegrating, any shift of power south will take time. However, Central America’s gangs, having spent years as subordinates to the Mexicans, could be well positioned to rise and take control of organized crime in the region.

– Edward Fox is a writer for Insight – Organized Crime in the Americas, which provides research, analysis, and investigation of the criminal world throughout the region. Find all of his research here.

Mexico Weighs Drug Policy after Colorado, Washington Legalization | AS/COA

Mexico Weighs Drug Policy after Colorado, Washington Legalization | AS/COA.

November 13, 2012

Less than a week after Colorado and Washington voted to legalize marijuana, Mexico’s president weighed in on “the need to examine” drug policy at a meeting he hosted with his Central American counterparts. The two states’ November 6 electoral decisions sparked questions about how the changes would impact Mexico’s drug war, and members of Mexican President-elect Enrique Peña Nieto’s party also made calls for another look at drug policy. But others say that legalization in the two states will have little impact on Mexico’s transnational crime issues.

Over the course of his presidency, Calderón has made no bones about the challenge of trying to control organized crime in his own country while the United States remains a top consumer of illicit drugs. “Part of the problem of violence we are experiencing in Mexico…is directly linked to the fact that we are next to the largest illegal drug market in the world,” he said at an AS/COA event in 2011. In September, he reiterated the sentiment before the UN General Assembly and, along with the presidents of Colombia and Guatemala, issued a statement urging the United Nations to review international drug policy.

As such, Calderón’s Monday meeting in Mexico City with the heads of state of Belize, Costa Rica, and Honduras was scheduled prior to the Colorado and Washington legalization votes. But the joint communiqué released afterward included a 10-point plan to fight the drug trade that made reference to the “paradigm shift” in local marijuana policies in the Americas. Uruguay is considering legalizing marijuana and distributing it via a state monopoly. In the United States, not only did Colorado and Washington legalize marijuana to allow regulating sale and consumption, but Massachusetts became the eighteenth state allowing medical-marijuana use.

The Mexican debate on drug policy is unlikely to end when Calderón steps down next month. Last week, Peña Nieto’s top advisor Luis Videgaray said the next president remains against legalization, but that what happened in Colorado and Washington “changes the rules of the game in the relationship with the United States” in anti-narcotics efforts. César Duarte, governor of the border state of Chihuahua and a member of Peña Nieto’s political party, went a step further and pitched producing marijuana for export, saying: “we would have control over a business which today is run by criminals.”

The degree to which marijuana legalization in a couple of U.S. states harms Mexico’s organized criminal groups remains unclear, however. A report by the Mexican Institute for Competitiveness estimates that 40 percent of the marijuana consumed in the United States each year comes from Mexico and that drug cartels could lose $1 billion annually due to Washington state’s legalization of the drug.

But others believe U.S. state-level legalization will have little impact. First, there is the question of whether the Colorado and Washington laws will remain in effect. The U.S. Justice Department couldchallenge the legislation if it claims federal law preempts state law. Next, cartels have a variety of revenue streams other than U.S. marijuana smuggling. Keith Humphreys, a former White House Office of National Drug Control Policy advisor, estimates that as little as 9 percent of Mexican cartels’ total profits comes from U.S. marijuana sales. Writing for InSight Crime, Geoffrey Ramsey covers the cartels’ “impressive ability to adapt to changes in the regional drug market” and expand into other criminal activities, from human smuggling to illegal mining. Mexican drug traffickers are also moving into new markets and are now the main supplier of methamphetamine to the United States.

On top of that, the Mexican public may not back major changes to domestic drug policy; a new survey found that 79 percent of Mexicans oppose marijuana legalization. Raúl Benitez Manaut of UNAM’s North American Research Center contends in Animal Politico’s El Palenque column that the recent U.S. drug-policy shifts may have little effect. “There are those from the new [Mexican] government who said…’this is going to change the whole paradigm’ on drugs,” he writes. “From my point of view, it was a hasty statement.”

 

Foreign Affairs – Hispanics and National Politics

Current demographic trends suggest that the percentage of Latinos eligible to vote in the United States will grow in the decades to come, and if Democrats continue to win lopsided margins among them, it will become nearly impossible for Republicans to win enough Electoral College votes to put a candidate in the White House.

via Hispanics and National Politics.

 

 

(Kevin Lamarque / Courtesy Reuters)

Since Election Day, pundits have broadly disagreed on why Mitt Romney lost. But they have largely agreed on why President Barack Obama won. Experts and strategists in the Republican Party had been predicting that the coalition that elected Obama in 2008 had splintered, was disenchanted, and would be unlikely to vote. They could not have been more wrong: black, young, and Latino voters came out in tremendous numbers, making up a big share of the president’s three-million-plus margin of victory.

In the election postmortems, Latinos have received a special level of attention, and for good reason. According to most estimates, Latino support for Obama was just a whisker short of the record 72 percent Bill Clinton got in 1992. Some reports even put it higher: The polling organization Latino Decisions gave Obama an eye-popping 75 percent of the vote, compared with 23 percent for Romney –a 3:1 margin.

“Almost everything you heard about the Latino vote in advance of the election turned out to be untrue,” said Juan Andrade, president of the U.S. Hispanic Leadership Institute and a longtime organizer and activist. Contrary to forecasts that the Latino vote would fail to materialize, Andrade noted that an estimated 1.5 to two million more Latinos voted this year than in 2008, even though overall turnout was lower this year. This time around, the Latino percentage of the overall national vote — an estimated 29 million eligible voters — moved into double digits for the first time, to roughly 11 percent. 

Current demographic trends suggest that that percentage will grow in the decades to come, and if Democrats continue to win lopsided margins among Latinos, it will become nearly impossible for Republicans to win enough Electoral College votes to put a candidate in the White House. This year’s race saw Latinos voting Democratic in swing states such as Colorado and Nevada. Those states, along with California, Florida, and Illinois, could easily remain out of reach for Republicans in the future. Even states solidly in the GOP camp — such as Georgia, Texas, and Arizona — are already turning purple and could eventually become blue.

The morning after Obama declared victory, I spoke to Juan Sepulveda, the national Latino coordinator for the Democratic National Committee. He said the outcome was the result of careful planning in advance of election season, with registration drives, field contacts, and banking early votes to avoid problems on Election Day. “Overall, we’re incredibly pleased,” he said. “We carried out our strategy exactly as we planned to carry it out, and we got even better results than we expected.” Sepulveda has no doubt that Latinos gave the president his margin of victory in Virginia, Colorado, and Nevada — all of which were vital to his victory. 

WHAT HAS NOT COME TO PASS

What can the Republican Party do in the face of a demographic transformation that seems to threaten the GOP’s very status as a national party? I put this question to Stanford University’s Gary Segura, a political scientist who heads the polling group Latino Decisions and is a co-author of Latinos in the New Millennium, a recently published book that examines Hispanic opinions and preferences on a wide range of political and social issues. It is a sobering read for any Republican hoping for better news in the future. “Latinos are just simply not very conservative,” Segura said. Republicans have long believed that they could appeal to Latinos on social issues, especially abortion. But, Segura explained, “Latinos are more conservative than other racial and ethnic groups on the subject of abortion but not wildly so.” When it comes to Latino opposition to abortion rights compared with the general public, he said, “We’re talking about a difference of five to seven points, not a difference of 30 points.”

Moreover, on other social issues, widespread assumptions about Latino conservatism are simply false. “Latinos support same-sex marriage,” Segura said. “We did a poll for Univision a year ago showing that the plurality of Latinos favored same-sex marriage, and then another segment favored civil unions, and only about 25 percent were in the ‘opposed government recognition’ crowd. NBC Latino released a poll showing that 60 percent of Latino registered voters favored same-sex marriage equality. That is not what Ronald Reagan had in mind when he said that Latinos are closet Republicans.”

Once upon a time, there was a hope in GOP circles that because many Latinos are devout Roman Catholics, and a fast-growing minority of them has embraced evangelical Protestant sects, they would eventually make common cause with Republicans. Other Republicans found solace in rising Republican Latino political stars such as Governor Susan Martinez of New Mexico, newly elected Senator Ted Cruz of Texas, and Senator Marco Rubio of Florida. But last week’s elections suggest that, when it comes to Latino voters, economic concerns trump cultural and religious ones. 

There is one other hope among a small sliver of the GOP: Statistics show that Latinos launch an impressive number of small businesses. According to some Republican strategists, this entrepreneurial drive will eventually propel Latinos more securely into the middle class and beyond. As they become more affluent, they will favor the GOP’s platform of lower taxes and fewer regulations. After all, it has worked that way with many immigrant groups in the past. Why, the thinking goes, should Latinos not be like Italians? 

“That had been my assumption. That’s been the assumption built into political science for a long time,” Segura says. But he argues that such a forecast ignores another possibility — that the Latino electorate will develop in a way similar to the African-American one. “The African-American experience is that as people move into the middle class or the upper class, their political behavior does not diversify,” Segura says. “That’s because they are still connected in meaningful ways” — especially through family — “to people who are still wildly disadvantaged.” Political scientists refer to this as “linked fate,” Segura explained: “The idea [is] that if African-Americans do better, everyone does better, and if African-Americans do worse, individual African-Americans will do worse.”

BREAKING OLD HABITS

Already there is talk from left, right, and center on a quick resolution to the nation’s unsolved debates concerning illegal immigration and the millions already living in the country without legal status. You are not likely to hear much talk of “self-deportation,” or the kind of slashing rhetoric heard as anti-Latino among legal residents and the undocumented alike.

Latinos face huge challenges ahead in education, unemployment, and clawing back that two-thirds of household wealth lost in the recession. Immigration is not all they talk about. It is, however, a threshold issue that signals how seriously politicians take Latino concerns. Many Latinos entered the 2012 campaign season convinced that neither party had taken immigration seriously as an issue. Obama had promised immigration reform as a top priority for his first term, while interdicting, detaining, and deporting record numbers of illegal border-crossers.

Republicans said they would be willing to deal on immigration, but Washington had to put “border security first,” refusing to acknowledge that the Obama administration had done anything, even as the country approached “net zero” immigration status with Mexico, meaning that as many people were going back home as attempting to enter the country. One of the Hispanic Congressional Caucus’ leaders on immigration, Illinois Democrat Luis Gutierrez told NPR, “There is pressure on Republicans to change their tune, but there is also pressure on Democrats to deliver.” In the days following the election, Democrats were quick to praise and thank Latino voters, and Republicans were rapidly moderating their previously tough talk.

But old habits die hard. Republicans are not going to change their party overnight. At the same time, though, Democrats will have to resist the temptation to take this growing vote for granted. Both big parties are now on notice: The road to the White House runs through barrios across the United States. Watch closely: Latinos will soon be figuring out what, if anything, their lealtad, or “loyalty,” to Democratic candidates brings them.

 

Time US – From Mexico to Moscow, the World Turns On to U.S. Marijuana Legalization

By Nov. 08, 2012

In April 2011, former Mexican President Vicente Fox sat before an audience at the University of Colorado at Boulder and in his baritone voice and frank tone urged Americans to legalize marijuana. His thrust: it could help enervate Mexico’s violent drug cartels. “The drug consumer in the U.S. yields billions of dollars, money that goes back to Mexico to bribe police and money that buys guns,” Fox said. “So when you question yourselves about what is going on in Mexico, it depends very much on what happens in this nation.”

At the time, many pundits warned that legalization was a nonstarter. But on Tuesday, voters in Colorado and Washington state did exactly what Fox called for: they approved landmark amendments to legalize, regulate and tax marijuana.

As supporters in Colorado jumped up and down, shouting “64, 64” after the amendment’s ballot number, the seismic implications of the reforms began to be slowly digested by activists across the globe, especially in drug-war-torn Mexico. “It was very emotional,” says Jorge Hernández, president of the Collective for an Integral Drug Policy, which is pushing for legalization in Mexico. “Now we are not like madmen in the desert. This transforms the debate.” That’s because the U.S. referendums signal the first time voters have approved the full legalization of marijuana anywhere on the planet, giving advocates from Mexico to Moscow bona fide cases to cite and follow. Even the famous cannabis coffee shops of Amsterdam exist only through an ambiguous policy of toleration often referred to as decriminalization, something Portugal has pursued as well. A 2009 Mexican law also decriminalized possession of small amounts of cannabis and other drugs, but production and selling has been left in the hands of bloodthirsty traffickers.

(MORE: Recreational Marijuana: Will Washington State Pioneer Legalizing Weed?)

Reformists in Colorado and Washington State are still far from claiming an all-out victory. Marijuana remains illegal under U.S. federal law, setting up a confrontation between cannabis growers and the re-elected Obama Administration. Furthermore, U.N. treaties oblige all signatories to prohibit the legalization of marijuana as well as cocaine, heroin and methamphetamine.

Nevertheless, entire countries may soon follow Colorado’s example, forcing an international review of the issue. Uruguayan President José Mujica is pushing to legalize marijuana by the end of the year — legislation there would even make the government the drug’s sole legal seller — and there is strong support for reforms in Argentina and Brazil. “What happened on Tuesday was a game changer. It will have a huge political and symbolic impact,” says drug analyst Alejandro Hope from the Mexican Institute for Competitiveness think tank. “Now it would be very hard for the U.S. to tell people not to legalize marijuana.”

The institute released a report last week saying that the U.S. state amendments could dent Mexican traffickers’ finances as gringo consumers buy more locally produced grass than the Mexican product, which it said accounts for a third of the Mexican drug cartels’ revenue. American smokers currently import from 40% to 70% of their cannabis from Mexico, according to the report. Legalization in just two states, of course, may not have a very dramatic effect. What’s more, Mexican cartels traffic other narcotics, including cocaine, heroin and meth, and commit lucrative crimes from kidnapping to extortion, so even nationwide U.S. marijuana legalization would not destroy the cartels. Still, it could substantially weaken them.

(MORE: How Latin America May Lead the World in Decriminalizing Drug Use)

Mexican President Felipe Calderón did not immediately comment on the votes in Colorado and Washington. Back in 2010, he had spoken against a similar initiative to legalize marijuana in California. However, after the huge cost of his military offensive against cartels, with about 60,000 drug-related murders since he took office in 2006, he has questioned prohibition in more recent statements — including a particularly frustrated speech last year after narcos massacred 52 innocent people in a Monterrey casino. In September, Calderón joined Latin American Presidents from Guatemala to Colombia in demanding a new U.N. debate on drug policy.

Calderón leaves office on Dec. 1, passing the torch to President-elect Enrique Peña Nieto, who has already said he wants to prioritize reducing murders above busting drugs. The new amendments in the U.S. will raise further questions about whether Mexico should send its soldiers and police to burn marijuana fields and seize the cartels’ vacuum-packed boxes of weed. “Why are we busting trucks of marijuana in Mexico when they are selling it over the counter in some U.S. states?” former Foreign Minister Jorge Castañeda asked on Mexican radio on Wednesday. “There is no logic to it. It is schizophrenic.”

Click here for original article.

 

Romney Must Romance Brazil to Boost Latin American Trade | AS/COA

Romney Must Romance Brazil to Boost Latin American Trade | AS/COA.

October 28, 2012

Mitt Romney’s plan for a Latin American trade region to enhance U.S. export prospects faces an enduring problem: Two decades after President Bill Clinton proposed a similar idea, the region’s biggest economies remain as mistrustful as ever.

Establishing accords with South America’s largest economies — Brazil and Argentina — would be difficult after leaders of the two nations joined with Venezuala’s Hugo Chavez in 2005 to sink the U.S. proposal to create a region-wide trade zone, according to regional experts.

Workers arrange flowers to be packed for export at an Elite Flower Ltda plant in Bogota, Colombia. Photographer: Paul Smith/Bloomberg

“We have trade agreements with the governments that want to have trade agreements with us already,” Michael Shifter, president of the Washington-based Inter-American Dialogue, said in a phone interview from Managua, Nicaragua. “The ones we don’t have trade agreements with are either not particularly interested or they’re very small markets that wouldn’t make much of a difference anyway.”

Romney, the Republican presidential nominee, has promoted free trade as part of his job-creation plan. President Barack Obama has stressed his administration’s enforcement of trade rules, including cases involving China. While Obama, 51, last year signed three trade deals that had been under consideration since before his presidency, including ones with Colombia and Panama, Romney, 65, has vowed greater focus on Latin America.

‘Huge Opportunity’

“The opportunities for us in Latin America we have just not taken advantage of fully,” Romney said in the Oct. 22 presidential debate. “As a matter of fact, Latin America’s economy is almost as big as the economy of China. We’re all focused on China. Latin America is a huge opportunity.”

The combined gross domestic product for the Latin American and Caribbean region in 2011 was about $5.8 trillion in current U.S. dollars, according to the World Bank. China’s GDP was about $7.3 trillion.

The Clinton administration in 1994 proposed the creation of a 34-nation hemispheric trade zone known as the the Free Trade Area of the Americas, or FTAA. The effort was abandoned in 2005 after Chavez led tens of thousands of protesters who burned an effigy of President George W. Bush while he was attending a regional summit in Argentina to discuss the proposed trade zone. Chavez said the failed accord was an attempt by the U.S. to “annex” Latin America.

Romney’s plan would seek to build upon free-trade deals the U.S. already has in place, while creating a broader accord –the Reagan Economic Zone — open to any nation “willing to abide by the rules,” according to a document posted on the Romney campaign’s website.

Free Enterprise

“Governor Romney is committed to expanding America’s trading relationships in the region by working to deliver on the promise of signed agreements, by pursuing new agreements, and by building a broader Reagan Economic Zone that strengthens ties among nations committed to the principles of free enterprise,” Amanda Henneberg, a campaign spokeswoman, said in an e-mail.

The reference to Ronald Reagan might face skepticism in the region, where people often associate the former president with U.S. support for the Contras in Nicaragua and the 1983 U.S. invasion of Grenada, according to Shifter.

“Romney would have to establish trust, and probably evoking Reagan doesn’t quite have the resonance in Latin America that it has in the Tea Party,” he said, referring to the U.S. political movement that has supported Republican candidates.

Connect Accords

As president, Romney would seek to “stitch up the agreements we have” into a regional trade zone, former Commerce Secretary Carlos Gutierrez, an adviser to the Republican nominee’s campaign, said during an interview Aug. 21. Such an effort would require nations in the region that have trade pacts with the U.S. to reduce economic barriers among themselves, he said.

The U.S. has in place free-trade agreements with 10 Latin American and Caribbean nations: Chile, Colombia, Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras, Mexico, Nicaragua and Peru. An 11th accord, with Panama, is scheduled to take effect Oct. 31. Trade preferences in place for Ecuador are set to expire in 2013, and U.S. relations with the nation have been strained over issues including Ecuador’s ties with Iran and Chavez.

It would be difficult to increase the number of trade accords in Latin America because of probable opposition from nations whose leaders can be hostile to the U.S., Rubens Barbosa, Brazil’s ambassador to the U.S. from 1999 to 2004, said in a phone interview from Sao Paulo.

Mercosur Bloc

A deal with the so-called Mercosur trade bloc, which includes Brazil, Argentina and Venezuela, would also be a challenge because the Latin Americans would insist the U.S. reduce barriers on agricultural imports, said Barbosa, who participated in the failed FTAA talks.

The U.S. filed a complaint against Argentina in August at the Geneva-based World Trade Organization over restrictions on imports from the U.S. Ten days later, Argentina fired back, telling the WTO that American import restrictions on Argentine meat weren’t justified.

The biggest missing element in trade policy with Latin America is an accord between the U.S. and Brazil. The nation’s $2.5 trillion economy is bigger than the combined size of the 11 regional nations that have free-trade pacts with the U.S.

“It’s just a big honkin’ economy,” Scott Miller, a senior adviser for trade policy at the Center for Strategic and International Studies in Washington, said in a phone interview. “There’s a big commercial relationship to be had.”

Competitive Edge

A deal with Brazil could expand exports of high-tech products and services in which the U.S. has a competitive edge over China, which is also establishing a presence in the region, Miller said.

China is the biggest export market for Brazil and Chile, the world’s top copper producer, and second-largest for Peru, Costa Rica and Cuba, according to an April report published by theUnited Nations’ Economic Commission for Latin America and the Caribbean, known as Eclac. China is on track to surpass the European Union as Latin America’s second-biggest trading partner, behind the U.S., it said.

“China is occupying space the U.S. has left vacant because the U.S. decided to commercially neglect the region,” according to Barbosa.

Brazilian Tension

U.S. economic relations with Brazil, its eighth-largest trading partner last year, are at the moment tense. During the last two months, the countries have sparred over Brazil’s proposed tariff increases on industrial goods, U.S. monetary policy and agricultural subsidies.

“I hardly think it’s possible to have a trade agreement with Brazil because the thinking here is the U.S. cannot deliver what we want: the opening of U.S. markets and reduction of subsidies as well as other protectionist practices in the agricultural area,” Barbosa said.

While a U.S. agreement with Brazil may not be in the nations’ immediate future, trade policy experts say Romney could still improve economic ties with the region.

“People complain that you can’t do a deal with Brazil so you should give up on Latin America,”Eric Farnsworth, vice president of the Council of the Americas, a New York-based business organization, said said in a phone interview from his Washington office. “That’s ridiculous.”

Integrating Accords

Integrating existing U.S. accords with Latin American nations would provide uniformity to pacts that govern different goods and standards, he said. The country could also seek to expand a Pacific-region trade pact to include Colombia, Costa Rica and Panama, according to Farnsworth.

The Latin America and Caribbean region is projected to grow by 3.2 percent in 2012 and 3.9 percent in 2013, according to the International Monetary Fund. The organization projects the economy of Chile to expand by 5 percent this year and Peru’s to grow at 6 percent.

“These are growth powerhouses and there’s no reason not to tap into that,” said Miller, with the Center for Strategic and International Studies. Linking existing trade accords would integrate producers in the region, much as the North American Free Trade Agreement has deepened the economic relationship among Canada, Mexico and the U.S., he said.

The next U.S. administration will also need to deal with growing trade tensions with Mexico, the nation’s third-largest trading partner. The U.S. Commerce Department on Sept. 27 made a preliminary decision to end a 16-year-old agreement that sets prices of tomato imports. Mexican officials have said they are willing to challenge the determination.

Mario Lopez Valdez, governor of the state of Sinaloa, a large agricultural producer on Mexico’s western coast, said the U.S. action is a violation of Nafta.

“If free-trade agreements are signed and then violated or not respected, it makes no sense to be signing free-trade agreements,” he said through a translator during an interview in Washington.

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2012 Election: U.S. Presidential Candidates on the Hemisphere

http://www.americasquarterly.org/2012uselection.

2012 Election: U.S. Presidential Candidates on the Hemisphere

As the U.S. presidential campaign intensifies ahead of the general election on November 6, 2012, AQ Online provides continuous updates of candidates’ positions on issues that are critical to U.S. relations with the Americas.

Check back here as the Republican candidate Mitt Romney’s Americas-focused policies—as well as related developments from the Obama presidency—unfold. We will post the latest statements on issues such as hemispheric cooperation, security, trade, immigration, and more.

MITT ROMNEY (REPUBLICAN)

FORMER GOVERNOR OF MASSACHUSETTS, 2012 PRESUMPTIVE NOMINEE


Photo: Gage Skidmore

Governor Romney announced a cadre of foreign policy advisors acting as a “shadow cabinet” last October. His Latin America team has two co-chairs: Ray Walser, senior policy analyst at the Heritage Foundation; and Clifford Sobel, U.S. ambassador to Brazil from 2006 to 2009.

Hemispheric Relations: In an October 2011 article in POLITICO, an aide to Romney said that “neither the [George W.] Bush administration or the Obama administration really focused on Latin America”—and added that Romney envisions “larger campaigns for economic opportunity in Latin America.” The Latin America issues page on Romney’s website says that he, in the first 100 days of his presidency, will launch a “public diplomacy and trade promotion effort” called the Campaign for Economic Opportunity in the region.

Bolivarianism: In October, Romney released a white paper, “An American Century: A Strategy to Secure America’s Enduring Interests and Ideals,” where he writes: “Venezuela and Cuba are leading a virulently anti-American ‘Bolivarian’ movement across Latin America that seeks to undermine institutions of democratic governance and economic opportunity.” He said one month later that “Hezbollah, which is working throughout Latin America, in Venezuela, in Mexico, throughout Latin America, which poses a very significant and imminent threat to the United States of America.”

Immigration: Romney believes that legislation which encourages a pathway to citizenship for undocumented migrants is “amnesty,” and referred to it in a November debate as “a magnet.” Romney supports legal immigration and the granting of green cards to any graduate of a math, science or engineering degree from a U.S. institution. He has supported controversial legislation at the state level, such as Arizona’s SB1070, and disagrees with any U.S. Justice Department effort to block the legislation from taking effect. Romney also favors completing the border fence, adding more border patrol agents, and ensuring the U.S. has an “E-Verify system and require employers to check the documents of workers.”

Counternarcotics: Governor Romney’s Latin America issues page promises to “build on separate existing anti-drug and counterterrorism initiatives to form a unified Hemispheric Joint Task Force on Crime and Terrorism.” The purpose of this task force would be one of intelligence sharing and law enforcement. The same page endorses building on the Mérida Initiative in the interest of “enhanced military-to-military cooperation and intelligence sharing” similar to Plan Colombia.

Cuba: In a January debate in Florida, Romney reiterated his support for the Helms-Burton Act and promised “to use every resource we have, short of invasion and military action, to make sure that when Fidel Castro finally leaves this planet, that we are able to help the people of Cuba enjoy freedom.”

BARACK OBAMA (DEMOCRAT)

FORTY-FOURTH PRESIDENT OF THE UNITED STATES OF AMERICA


Photo: White House

2008: In the 2008 general election, Latinos voted for the President by a more than two-to-one margin over Arizona Senator John McCain (67 percent to 31 percent). A March 2012 poll by Fox News Latino shows that 73 percent of likely Latino voters approve of the president’s overall performance in office. The same survey indicates that, when matched one-on-one with any GOP opponent, Obama wins the Hispanic vote by double digits, and that four of five Latinos who voted for Obama in 2008 would re-elect him.

Trade: In October 2011, President Obama signed into law free-trade agreements with Colombia, Panama and South Korea. This came after a series of deals with lawmakers questioning various provisions of each agreement. In a statement, the President said: “If we do not seize the opportunity to lead, others will, and the accompanying economic benefits will accrue to their nations rather than ours.”

Hemispheric Relations: In 2009, Obama attended the Fifth Summit of the Americas in Port of Spain, Trinidad and Tobago, where he pledged for a renewed era of “equal partnership.” Before flying to the Summit, Obama was in Mexico meeting with President Felipe Calderón to discuss a range of bilateral issues, such as counternarcotics measures, the arms trade, immigration, and the economy. In March 2011, Obama made his first official visit to Central and South America—traveling to Brazil, Chile and El Salvador to reinforce commercial and strategic linkages with the region. In April 2012, he will travel to Cartagena, Colombia for the Sixth Summit of the Americas.

Cuba: Shortly after assuming office, Obama began easing travel restrictions to Cuba—from three times per year under Obama’s predecessor to an unlimited number of visits. Obama also permitted Cuban-Americans to visit their relatives on the island as often as possible. In April 2011, the Treasury Department’s Office of Financial Assets Control (OFAC) allowed religious organizations and educational institutions to apply for an OFAC license to travel to Cuba. But like his many predecessors since Cuba’s 1959 revolution, Obama favors maintaining the embargo as well as preventing Cuba from rejoining the Organization of American States.

Immigration: Despite Obama’s support for legislation such as the DREAM Act, no such bill has arrived on his desk. The DREAM Act failed in the Senate in December 2010, mere weeks before a Republican-controlled House of Representatives went into effect. In August 2011, the Obama administration announced that undocumented students and other low-priority immigration offenders would not be targeted for deportation. However, a report late last year from the U.S. Immigration and Customs Enforcement branch of the Department of Homeland Security showed that Fiscal Year 2011 was a record year for deportations, amounting to nearly 397,000 individuals.