The Latin American Report # 13

Hello, hivers. Here you have the thirteenth delivery of my #latamreports series, where I review the last trends in Latin America's political and economic landscape. Today I come back again to my country —Cuba— though indirectly, at the same time that we take a stop in Paraguay for the first time, in light of the following general elections there on April 30th. And so we monitor new developments on specific topics like corruption in Venezuela, whose following we have activated recently. Let's go ride on it ya.

The Latin American Report | Deep Dream Generator


U.S. Secretary of State Antony Blinken today ruled out removing the Island for now from the list of countries sponsoring terrorism, where it was controversially inserted and even discussed by specialists in the matter of the United States itself in the aftermath of the Donald Trump administration. It was what in foreign policy is known as an "irritant", because taking into account the comprehensive nature of the blockade or trade embargo if you like, with which the United States has subjected the Cuban economy since 1962, including it on the list is more a matter of rhetoric than practice.

Trump's team appealed as justification for an attack perpetrated by members of the National Liberation Army (ELN in Spanish) in Colombia. The government of former President Iván Duque demanded from Cuba the extradition of the representatives of the aforementioned organization who were here for talks to reach a peace agreement similar to the one signed between Juan Manuel Santos and the FARC-EP. Cuba refused by its role as mediator and on other legal grounds and paid the consequences in Washington.

The interesting thing is that the current Colombian president interprets and affirms that it's a shame the presence of the Caribbean nation on the referred list because of the ELN attack, for which in any case it's not responsible, and has publicly exonerated it while making statements accompanied by high-ranking U.S. officials. Cuba doesn't appear as an active or even indirect party in any current military conflict or the execution of real terrorist acts, and that's the reason it's comical, to say the least, to hear State Department and White House spokespersons argue why, for example, this political-economic instrument does not apply to a country like Russia.

Blinken, genuflecting before a Cuban-born congresswoman in the House of Representatives, said that for now, they don't plan to remove Cuba from the list. However, historically these Executive commitments in the U.S. Congress have proven to be very weak in a general sense, and when asked specifically if he was committing himself under oath to the position that a change was not to be expected, he only said that, if there were to be a review, "it would be based on the law and the criteria it establishes, which [set] a very high bar". The Cuban hero José Martí used to say that "in politics what is real is what is not seen", so let us not rule out that in a stroke of the rudder the U.S. policy towards Cuba, in secret agreement with Havana, may produce a change that will correct this nonsense.


A delegation of the EU Election Observation Missions program is already in the South American country to accompany the general election process, where the new President and Vice President of the Paraguayan Republic will be elected, together with the members of Congress and other local authorities. As of next Monday, another 28 observers are due to land and will be distributed throughout the country's 17 departments, and will remain there after the voting.

In these elections the dispute seems to be reduced to two formations: a center-left variant gathered in the opposition alliance known as "La Concertación" (The Concertation), and the ruling and historical Colorado Party, associated with right-wing positions and conservatism. The left which could be understood as more "radical" within the Paraguayan political map, where the forces of the "Frente Guasu" can be distinguished —there you have the former president and now senator Fernando Lugo—, doesn't seem to be in a position to take a protagonist role in this electoral contest.


This country is summoning our gaze with increasing frequency, particularly because of the drug-trafficking-spattered corruption that we can't say threatens, but has already vitiated and compromised the electoral process in which Guatemala is involved. There is even talk of an agreement among elites to free the way to the presidency for Zury Ríos Sosa, daughter of former dictator Efraín Ríos Montt, who curtailed freedoms of all kinds there in the 1982-1983 biennium. According to a report by the Spanish news agency EFE, the population is apathetic about the elections, and with good reason.

It is noted there that at least ten politicians who at some point have been linked to drug trafficking have applied to be registered with the Supreme Electoral Tribunal, and in some cases have received the blessing of a powerful body that is supposedly charged with rejecting such applications. These include the cases of Sofía Hernández, an ally of current President Alejandro Giammattei, with two brothers accused by the U.S. of belonging to a criminal organization based in the north of the country, and Esduin Javier Javier, who is not only running but is currently mayor of the municipality of eastern Ipala. Javier Javier has an open criminal case for contract killing and is also reportedly connected to drug trafficking. Violence is a serious problem in the Central American nation, with 60,000 homicides since 2003 to date.

On the contrary, other forces of the left and even of the right see how their candidacies are blocked by appealing to dubious charges or in any case much weaker than those mentioned, such as the left-wing indigenous leader Thelma Cabrera or Edmond Mulet (ascribed to right-wing positions). The elections will take place next June 25, closing this Saturday the registration process just three months in advance.


Reuters reports that an expanded review of Venezuelan state oil company PDVSA's export contracts has almost completely halted all crude and fuel exports as officials audit the matching of invoices and payment supports. The anti-corruption investigation that we introduce here this week already has 20 defendants among employees, judges, and high-rank politicians, and resulted in the resignation of a hitherto untouchable politician such as Tareck El Aissami.

PDVSA has accumulated a whopping $21.2 billion in receivables since 2020, of which $3.6 billion are potentially unrecoverable, associated with cryptocurrencies as a payment mechanism, an alternative in principle approved by the authorities to circumvent Western sanctions. Only clients who are receiving economic compensation through crude oil (as is the case of the U.S. Chevron), or in exchange for other products and services are loading it right now.


Regional currencies closed mixed on Wednesday, after the USD rallied following interest rate hikes adopted in Switzerland and England. This is reflected in the 0.1% rise in the value of the dollar index against a basket of six Latin American currencies. The Chilean peso continues to benefit for the sixth consecutive session from the rise in the price of copper, Chile's main exportable commodity, and gained a positive 1.33% at the close; the IPSA, the leading index of the Santiago Stock Exchange, rose by a slight 0.08%.

The Mexican peso ended the day +0.03% versus Wednesday's Reuters reference price, with the S&P/BMV IPC, which houses the 35 most liquid Mexican companies, outperforming by 0.51%. The Fed's dovish tone, which was not as hawkish as yesterday, was favorable to the dynamics observed in the region. The Brazilian real anyway fell by 0.98%, while the Bovespa index of the Sao Paulo B3 stock exchange fell by 2.29%. There is a red point here, awaiting President Lula da Silva's position regarding the decisions enforced by the competent authorities on financial matters. This Friday there may be signals before his departure to China.

The Argentine peso fell 0.19%, while the Merval stock index didn't sustain the good performance of the first market hours and fell 2.5%. The Colombian peso gained 0.72% against the dollar for the third consecutive day, although the MSCI COLCAP lagged by 2.17%. Finally, the Peruvian sol advanced 0.03%, without being followed by the Lima Stock Exchange benchmark, which lost 0.53% in the daily trading session.

This is all for our thirteenth 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.

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