Weekly Roundup: Venezuela's Devaluation, Pemex's Prospects, Brazil's Hydropower

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The Impact of Venezuela’s Currency Devaluation

Since the Venezuelan government devalued the bolivar on February 8, its exchange rate fell by 32 percent, decreasing from 4.3 to 6.3 to the dollar. But what will be the outcome? In “Venezuela Devaluations: the Long and the Short of it,” Emerging Markets reports that while there is potential for short-term relief, the devaluation could have a long-term negative impact on inflation. The Economist explores “What Devaluation Actually Means” and notes that devaluation can trap an economy in a cycle of high inflation marked by a decline in standard of living.

FARC Demobilization, Captures Rise amid Peace Talks

A report released this week by Colombia’s Ministry of Defense shows that the government increased the number of guerrillas captured, killed, and demobilized since Colombia began peace talks with the guerrilla group Revolutionary Armed Forces of Colombia (FARC) last year. The government captured, killed, and demobilized nearly 1,500 FARC members—including 5 commanders—since September 2012—a 17 percent increase over the same period in 2011.

New Pemex CEO Sees State Firm as "Lever for Development"

The Wall Street Journal takes a look at prospects for Mexican energy reform under a new presidential administration, interviewing CEO of state oil firm Pemex Emilio Lozoya. Energy reform remains a contentious issue in Mexico, but government dependence on exporting oil to cover spending costs translates to little left for Pemex to invest in other energy opportunities, such as natural gas. While Lozoya avoided specifics on reform, he indicated Pemex could act as a “lever of development,” saying, “I foresee and I hope that in a couple of years we'll have a much stronger energy sector with many more medium-size companies present in it.”

Brazil Harnesses Hydropower

In response to the country’s industrial expanse, Brazil is undergoing a “construction boom that will install dozens of hydroelectric dams in the Amazon,” NPR reports. Critics say dams displace villages and permanently alter livelihoods, but proponents say the dams are necessary to support the country’s burgeoning growth and energy needs. 

Press Freedoms at Risk in Brazil and Ecuador

This week the Committee to Protect Journalists (CPJ) released its 2012 Risk List, which included Brazil and Ecuador among the 10 countries where press freedom most suffered last year. In Brazil, four journalists were killed as a result of their work, and judicial censorship remains high, with hundreds of lawsuits filed against critical journalists. Ecuador saw 11 private broadcasters close last year, while the news media is prohibited from openly covering the February 17 presidential election. CPJ Americas also published an article discussing the murder of two Brazilian news bloggers in 2012—the first time bloggers were killed in Brazil because of their work.

For Uruguay, Ins and Outs of Having an Argentine Neighbor

Financial Times’ beyondbrics blog writes of Uruguay’s “risky dependency” on the economy of its next-door neighbor, as Argentines flood its banking and property sectors. The result, says the post, is that Uruguay’s inflation rate is running at 8.7 percent a year. Still, the blog says there is a chance that “the pluses of having Argentina next door are still bigger than the minuses” as farming groups look to Uruguay to invest and Montevideo earned top billing in 2012 as the best South American city to live in.

Weighing Top Priorities for U.S. Congress in Latin America

In a February 8 report, the Congressional Research Service outlines top Latin American policy issues likely to receive attention from for the 113th U.S. Congress. Relations with Mexico could be a priority, particularly continuing bilateral security initiatives and in conjunction with policies put forth under new President Enrique Peña Nieto. Congress will likely monitor progress on the Trans-Pacific Partnership negotiations—which include Chile, Mexico, and Peru—as well as potentially seek closer ties with Brazil.

Latin America’s Best Environments for PPPs

Chile, Brazil, Peru, Mexico, and Colombia, respectively, are the hemisphere’s best environments for public-private partnerships (PPPs), according to the 2012 Infrascope report produced by the Economist Intelligence Unit. The need for infrastructural improvements has led “countries to redouble efforts to attract greater private investment,” writes the Inter-American Development Bank.

Guatemala Faces National Coffee Emergency

President Otto Pérez Molina called for the release of $14 million in aid for farmers affected by a disease killing the country’s coffee plants. The Associated Press reports that 70 percent of Guatemala’s coffee crops have been damaged with coffee rust, leading to a loss of 100,000 jobs.

Paraguay Struggles with Blackouts

With large-scale blackouts that began in December, Paraguay is facing an energy shortage. The country’s electricity administration asked Paraguayans to cut electricity use during peak afternoon and evening hours, and the government aims to finish a new transmission line by April to avoid more power outages. In a February 13 op-ed, Paraguayan daily ABC Color contends that the country currently lacks an energy plan.

Russia’s Arms Exports to Latin America

AméricaEconómica reports that in 2012, Latin America received 18 percent of Russia’s arms exports, with Venezuela at the top of the list. State-run Rosoboronexport supplied a total of $12.9 billion worth of arms to roughly 60 countries last year.

Bogota Puts Cars before the City'’s Horse Carts

The leader of a metropolis with approximately 3,000 horse carts, Bogota Mayor Gustavo Petro began a program to remove these wagons by the end of this year. Horse carts often lead to traffic accidents, but previous government attempts to get the carts off the streets proved unsuccessful, writes GlobalPost. This time, horse owners will receive a $12,000 credit to buy a new vehicle or start a small business.