Original Source (Edited with Canva)
Hello, hivers. This is the 25th edition of The Latin American Report, an effort where I try to condense the vast news panorama of the region with an almost daily frequency. Today we focus a bit of the spotlight on Brazil and Ecuador, while also updating the dynamics on the U.S. southern border and reviewing the performance of two of the currencies that make up the classic regional basket of six. Let me jump on the report now.
Brazil
More and more Venezuelans are taking advantage of a Brazilian program that relocates them to southern states with greater economic opportunities than the border state of Roraima, providing them with work permits, health care, and even facilitating their travel. The program is already five years old, and the post-covid period has seen an increase in the number of Venezuelans joining, seeking an alternative to both the battered economy and violence, the latter being the case of Miguel Gonzalez, who made US$ 600 a fortnight as part of a mining community, where, in contrast, people are often one step away from death. It is estimated that more than 7 million Venezuelans have left the country since the crisis deepened there some 10 years ago. The Brazilian offer has already helped some 100,000 of the more than 425,000 sons and daughters of the land of Bolívar who have crossed the border into the South American giant, where the minimum wage was recently set by Lula da Silva at US$ 265, well above the Venezuelan standard.
A Venezuelan family's shelter in Brazil, as provided by the referred program, also supported via UN (Source).
A bid for more transparency
Lula signed three complementary decrees to the Brazilian Access to Information Law, aimed at strengthening the transparency of institutions as part of the fight against corruption. Aspects related to secrecy in classified documents were reviewed, the rules that state institutions must follow to ensure access to public and quality information —Lula criticized the setback that Bolsonaro's presidency meant in this regard, particularly about the crisis originated by Covid-19—, the role of the Comptroller General's Office was reaffirmed, and a Council for Transparency, Integrity and Fight against Corruption was created, which will have a civilian character.
Lula delivers on one of his promises
On the other hand, the state-owned oil company, although with shares traded on the Sao Paulo, Madrid, and New York stock exchanges, announced a reduction in the price of fuels (gasoline, diesel, and liquefied gas), appealing to a methodology that distances itself from the parity with the dollar, which the leftist government assumes was a deception and ultimately placed an enormous burden on the Brazilian consumer. Lula reasons that the prices in force until yesterday did not make sense in a country self-sufficient in this matter. In this way, he is, without delay, turning campaign promises into reality in a highly polarized country. While disputing the cessation of the new methodology's parity with the dollar, JP Morgan stated to its clients that it was more market-friendly than what had been projected. The challenge for Petrobras is to continue to be attractive to investors, something that officials say is not compromised by the new policy. The company's shares on the Sao Paulo Stock Exchange were trading higher at the close of this report.
Ecuador
The great leaps of a dog trained to detect cocaine led Italian authorities at the port of Gioia Tauro to seize more than 2,700 kilograms of the drug, which was hidden in 70 tons of bananas packed in crates, coming from Ecuador. On other occasions we have reported the raid of this type of shipment in the countries of the region, but this time the drug traffickers "managed" to pass the controls and reach Europe. Why the intuition of the Italian police didn't manifest itself first in Ecuador? The shipment's final destination was Armenia with a stopover in Georgia, and its sale would have involved profits of more than 900 million dollars. Days before, the authorities report, 600 tons of the same drug had also been seized, also coming from Ecuador using the same artifice. Real-life "movie".
#GDF #ReggioCalabria e @AdmGov, con il coordinamento della #DDA, nell’ambito della lotta al narcotraffico, hanno sequestrato oltre 2700 kg di cocaina occultati in container in transito nel porto di Gioia Tauro. #NoiconVoi pic.twitter.com/ATo5NsxHdA
— Guardia di Finanza (@GDF) May 16, 2023
Impeachment trial against Lasso in Congress
And today the impeachment trial against the Ecuadorian president that is advancing in the National Assembly of Ecuador started today, accusing him of not having acted actively in defense of the interests of the State in the face of allegations of embezzlement in the execution of a contract involving the state-owned company Flopec. Lasso is discussing the accusation when it is still not clear how the situation may end in the Andean country (the opposition would not have the votes to remove him —92 in total—); the possibility that the president dissolves the assembly forum appealing to a constitutional recourse is being considered. On Saturday, in principle, the final vote would take place, if Lasso does not make a move in a case that has shown the high level of polarization that exists in the nation.
A esta hora Guillermo Lasso se pronuncia ante el Congreso de Ecuador en medio de juicio político en su contra. "Mientras más pintoresca sea su acusación mayor será la oportunidad de mostrar el talante democrático de nuestro país", afirmó. https://t.co/CXyaotioAD pic.twitter.com/PPqSVh7XY6
— NTN24 (@NTN24) May 16, 2023
Update on the US Southern border situation
According to administration reports, the situation at the U.S. southern border remains under control, with evidence of a decline in migrant arrivals since the expiration of a controversial Trump-era health order known as Title 42 —for the codified legislation by which it was authorized— that allowed for the expedited removal of undocumented arrivals without the right to file asylum cases. It seems that, supported by the multiplied surveillance efforts of Guatemala and Mexico, the actions to confront smugglers carried out in Panama and Colombia, the design, implementation, and communication of the new policy, based this time on the specific Title 8 of the U.S. Code, the Biden administration has managed —for the time being— to touch the migrant's nerve. Since Friday, some 5,000 encounters with migrants attempting to cross the border illegally are being averaged daily (last week's daily peaks reached 10,000), while 2,400 individuals have been returned to México under an agreement with the government of Andres Manuel Lopez Obrador, including Cubans, Venezuelans, and Nicaraguans.
Regional quicks
After a year, two Chilean regions remain under a state of emergency, proclaimed and consequently extended by President Gabriel Boric (this implies that the Armed Forces are known to participate in guaranteeing internal public security). These are two provinces of Biobío and the entire region of La Araucanía, where the key factor is the historical claim of Mapuche minority groups for the return of their ancestral lands. To make matters more tense, drug trafficking gangs operate in these regions and there are also incidences of timber theft. The government has appealed to dialogue as the way to solve the conflict —the Mapuche ethnic group has plenty of reasons for its struggle—, but it has been unable to find the narrative that would allow it to effectively install it in the face of a social group that is not very inclined to sit down and negotiate.
The Argentine and Mexican currencies were set to end the second market day of the week with losses. In the case of the Argentine peso, it was down 0.22 %, at a time when experts agree that the most recent package of measures approved by the Government does not seem to be able to contain annual inflation that is estimated to reach 130 %. On the other hand, the S&P Merval advanced 0.42 % concerning the last close. The Mexican peso, on the other hand, after reaching a new peak on Monday, in this case, an unprecedented one in seven years, was also down 0.22 %, while awaiting the next monetary decision in the country to be announced next Thursday. The S&P/BMV IPC index, which captures the performance of the country's most liquid companies, appreciated by 0.36%.
And this is all for our twenty-fifth report. I have referenced the sources dynamically in the text, and remember you can learn how and where to follow the LATAM trail news by reading my work here. Have a nice day.
Edited with Canva.