Weekly Roundup: Honduran Accord Reached, U.S.-Colombian Military Pact Signed, Mexican Tax Reform Approved

Deal Reached on Honduran Political Stalemate but Zelaya's Return Uncertain

After four months of a political impasse, negotiators for deposed Honduran leader Manuel Zelaya and interim leader Roberto Micheletti reached a deal that, if approved by the country’s Congress, would allow for a power-sharing government. A delegation from Washington, including U.S. Assistant Secretary of Western Hemisphere Affairs Thomas Shannon, was involved in this last round of negotiations that prompted the accord. OAS Secretary General José Miguel Insulza announced that, given the deal,  a general assembly would be convened on November 16 to lift sanctions against Honduras. Ex-Chilean President Ricardo Lagos, a member of a verification committee tasked with overseeing that the deal’s measures are met, said a Cabinet of National Unity will be formed on November 5 in advance of the November 29 elections.

Whether Zelaya will regain his office remains uncertain. As The Wall Street Journal reports, a committee of 14 Honduran lawmakers voted against calling a requisite special session to decide on whether the deposed leader would be reinstated. With no deadline to make a decision and elections nearing, Zelaya may not regain his post.

Writing for ForeignPolicy.com’s The Argument, AS/COA’s Christopher Sabatini and AQ blogger Daniel Altschuler warn that, even with the breakthrough, some will continue to push “ideologically driven revisionism” in their coverage of the Honduran coup. “Allowing a government that came to power through unconstitutional means to ride out an interim period to the next election and then transfer power would set a perilous precedent,” they write. “The deal struck last week offers a responsible, democratic exit from the four-month political crisis in Honduras.”

Colombia and U.S. Sign Controversial Military Deal

On Friday, the United States and Colombia signed a military pact that gives U.S. troops access to seven Colombian bases to combat drug trafficking and guerrilla fighters. The agreement was framed at a time when Ecuador’s President Rafael Correa refused to renew a U.S. lease on its Manta base. The deal has drawn concern both within Colombia and from other South American countries; UNASUR debated its response to the deal this summer and the Bolivarian Alliance for the Peoples of the Americas condemned it. A statement from the Colombian government released after the 10-year agreement says the pact “respects the principles of equal sovereignty, territorial integrity and nonintervention in the internal affairs of other states.”

Learn more about the U.S.-Colombian military pact at AS/COA.

Venezuela Closes Part of Colombian Border over Massacre Controversy

The killing of two Venezuelan soldiers near Colombian territory by a gang of four men on motorbikes has flamed border tensions between the Andean countries. The Venezuelan government closed off its northern border in the aftermath of the shooting on Monday, which is the latest in a string of violent and criminal incidences near the Venezuelan-Colombian border.

Signs of Dwindling Support for Bolivarianism in Venezuela

Since initiating his “Bolivarian Revolution” in 1999, Venezuela’s President Hugo Chávez usually managed to retain the popular support of his constituents. But a new survey finds that 60 percent of Venezuelans have a negative view of their country’s present conditions. This news comes as citizens of Caracas endure water shortages and electricity blackouts, both of which Chávez attributes to dry weather and increased consumption exacerbated by economic growth. Critics blame the problems on underinvestment in water and electricity infrastructure along with mismanagement, poor planning, and corruption in state utilities.

Peru Named a “Star Country”

During AS/COA's Lima Conference on November 3, Finance Minister Luis Carranza said Peru’s economy demonstrates high growth rates with the help of private and public-sector investments as well as sound fiscal policy. AS/COA’s Susan Segal said: “Peru is a good example of growth, the star country of the region.” President Alan García delivered opening remarks at the program.

Trust in LatAm Militaries May Correlate with Economic Growth

Latin Americans remain distrustful of their armed forces, but a recent Vanderbilt University study finds that trust correlates to economic growth rather than past experience with military repression. The study shows that Mexico and Brazil have the highest levels of confidence in their militaries while Argentina and Paraguay have the least. Two Weeks Notice blog expresses some skepticism about the economic growth theory and points out that several countries surveyed have similar growth rates.

Taking Stock of South American Military Spending

A recent wave of weapons purchases by South American countries has raised speculation of an “arms race” in the region. The Miami Herald compiled a list of recent and ongoing military purchases, including information about spending as a percentage of GNP. In that regard, Colombia’s spending rate is the highest at 4 percent of GNP, while Argentina and Paraguay weigh in at the lower end of the spectrum at 0.8 percent. Brazil, Venezuela, Chile, and Colombia account for 80 percent of South American arms purchases, with Brazil spending the most at $27 billion.

Read an AS/COA analysis about South American military spending.

Police Uncover Uruguayan Arms Arsenal

Police discovered a weapons arsenal in Uruguay belonging to an accountant alleged to be involved in arms trafficking, possibly with Brazilian drug gangs, reports Uruguay’s Espectador.com. The suspect, Saul Feldman, died in a confrontation with police, who uncovered two stashes totaling 700 arms.

Former Chilean Soldiers Offer to Share Pinochet Crime Details

The Guardian reports that former soldiers conscripted during the dictatorship of Augusto Pinochet are offering to share information about human rights abuses carried out under the regime. In exchange, the veterans hope to receive pensions and immunity from prosecution.

Tests for a Rising Brazil

Arthur Ituassu, a professor of international relations at Rio’s Pontifica Universidade Católica, writes for openDemocracy about the media frenzy over the fact that Brazil “in some elusive but unmistakable way ‘arrived’ as a global player.” The incident that most demonstrated this new global leadership was likely deposed Honduran leader Manuel Zelaya’s decision to take refuge in the Brazilian embassy in September, writes Ituassu. But, he warns, Brazil faces two major tests: overcoming poverty and social inequity while avoiding “any nationalist adventures in the foreign arena.”

Reexamining U.S.-Latin American Partnerships

In the latest issue of Poder, COA Vice President Eric Farnsworth reflects on U.S-Latin American relations since the 1989 invasion of Panama. “The United States has the right to expect others to hold up their end of the bargain,” he writes, saying the Obama administration’s move toward a cooperative approach deserves Latin American reciprocity.

U.S. Opts for Mexican Rather than Chinese Manufacturing

Mexico replaced China as the number one destination for American manufacturing firms to set up assembly-for-export plants. CNN reports the change is due to cheaper transportation costs and the appreciation of the Chinese currency against the dollar. An index developed by the business advisory firm AlixPartners finds that manufacturing in Mexico is 68 percent the cost of in the United States, compared to 73 percent in India, 86 percent in China and 91 percent in Brazil.

Read a summary of an AS/COA program about Mexico as a nearshoring opportunity.

PRI Senators Abstain from Mexican Tax Reform Vote

Mexico’s Senate approved a majority of the reforms voted on by the Chamber of Deputies, including an unpopular increase in the value-added-tax. Senators of the opposition Institutional Revolutionary Party (PRI) either left prior to the vote and the seven who stayed abstained from voting. Under the Volcano blog states that, as a result, the PRI avoided political fallout even though state governors—mostly PRIistas—stand to gain the most from the increase.The PRI strengthened its control over Congress in midterm elections over the summer.

Guatemalan Supreme Court Selection Process Moves Forward

In wake of alarm surrounding the selection of six Guatemalan Supreme Court judges under investigation by a UN-sponsored human rights commission, the country’s Congress elected to replace only three of the magistrates. Activists say this move, though still imperfect, represents an improvement in the judicial selection process, reports IPS News. “[F]or the first time in the history of this country, civil society participated actively in the debate on the administration of justice and the need to take a close look at a candidate's professional qualifications and ethics," says Carmen Aída Ibarra of the Myrna Mack Foundation, a local human rights group.

Costa Rican Official Resigns after Bridge Collapse

Alex Leff blogs for Americas Quarterly about the a decision by Karla González, Costa Rica’s public works minister, to resign after a bridge collapse there led to five deaths in late October. Costa Ricans have long been wary of the ministry, charging it with inefficiency. “Although it takes courage to assume responsibility and likely end one's career, skeptics might say stepping down is easy,” writes Leff. “Now comes the tough part for whomever fills [the minister’s] spot."

Cuban Purchases of U.S. Products Tank

Latin American Herald Tribune reports that Cuban imports from the Unites States are expected to decrease 37 percent in 2009 when measured against figures for the prior year. Factors in the decline include rising food prices, the global financial downturn, the ongoing U.S. embargo, and the island’s own severe economic slump. Cuba's overall trade levels are down by 36 percent compared to last year.

Dual Currencies to Merge in Cuba, Says Diplomat

A Cuban diplomat said in an interview that the government will merge its dual currencies to simplify economic operations for citizens and foreign tourists. Wages and domestic purchases are denominated in the “national peso” (worth a few cents) under the current system, while foreigners must use the “convertible peso” (valued at about $1) in hard-currency shops on the island.

More Immigrants Head South

McClatchy reports that immigrants are opting to move to the American south over traditional immigrant gateway cities like Los Angeles, New York, and Chicago. The article reports that “a growing number of successful immigrants in New York are moving to Southern cities that boast a lower cost of living and a better chance to achieve middle-class goals such as homeownership and sending their children to college.”

Learn more about AS/COA's Hispanic Integration Initiative, which recently published a white paper titled “Economic Opportunity and Integration: Nashville's Hispanic and Business Communities.”

El Salvador Ranked High for Tourist Attractions

Lonely Planet, the world’s largest travel guide publisher, gave El Salvador the nod, ranking the Central American country among the top ten travel destinations for 2010. The publication points out that Salvadoran beaches are tranquil and the country is not overrun with tourists compared with some parts of Costa Rica and Guatemala. San Salvador is also recommended to travelers as an “exciting capital” and the Central American country has “fantastic national parks and surfing opportunities.”