The Latin American Report # 7

Hello, hivers. Here you have the seventh delivery of my #latamreports series, where I review the last trends in Latin America's political and economical landscape.

Via Deep Dream Generator


Brazilian federal agents boarded an illegal mining operation in the Brazilian Amazon from three helicopters yesterday. What's interesting is that those who defended the site and then fled left a trail that, according to Associated Press reports, is becoming increasingly common: Starlink equipment that has become popular in these areas of low Internet coverage because of its remote nature.

The flexible installation of Internet by this means is a factor that now plays in favor of Brazilian illegal miners, who coordinate their logistical processes, alert systems, and payment mechanisms without having to return to the urban area. So we have a game here that is not new, where the most advanced technologies or those designed for specific purposes end up being used by agents with interests that are not necessarily aimed at social welfare or peace.


The government of Gustavo Petro today introduced a bill that aims to bring drug traffickers and criminal gangs to justice with the benefit of special criminal treatment, which, according to AP, includes "a few" years in prison.

We have already commented here on this "Total Peace" policy, one of the main banners of the first leftist government in Colombian history, which also includes negotiations with armed groups such as the FARC-EP dissidents. The difference is that in the case of criminal gangs and drug traffickers, the exit does not project peace processes or political treatment.

These types of proposals tend to divide public opinion. The "Clan del Golfo", recognized as the largest cartel in the country, would be one of the criminal organizations that would benefit from the government plan, although the government only recently focused on it because of its probable link with a protest aimed at protecting illegal mining businesses. See, by the way, how the pattern of illegal mining in the region repeats itself, an issue that has a very strong social connotation behind it. We will continue to monitor this trend.

And yet, like a snake biting its own tail, a sort of vicious circle, it transcended late tonight that the former leader of the FARC guerrilla, Rodrigo Londoño, has warned Petro that the peace agreement in force with his former guerrilla is in "grave danger".

Via Twitter, Londoño warns that the organizations with which the Colombian government intends to negotiate peace have made his group the "target of their actions", and that instead, he isn't finding receptive ears for his demands to be met.


The decision of Xiomara Castro's government to bet on China instead of Taiwan, in a stark and very sincere exercise of economic calculation and profitability in international relations, is in the regional debate.

The Honduran Foreign Minister, Eduardo Enrique Reina, explained today that the new position, which Castro had advanced in his campaign, is anchored to the economic needs of the Central American country, which as we have mentioned before are enormous. The clear objective is to assimilate a greater slice of China's investments in the area. Enrique told The Associated Press that relations with Taiwan have historically been positive, but that they must inevitably appeal to a stronger diplomatic bond on China's behalf.

Taiwan's embassy in Honduras was more than diplomatic in its statement, referring to the "fraternal friendship" with Honduras over the past 82 years. The Honduran social crisis is a point that both the United States, which is interested in the quota of migrants from there trying to cross its border, and China, with its own geopolitical and economic interests, seem to be watching closely.


Argentine soybean crushing plants are working with the highest historical levels of idleness (70%) due to the effects of a relentless drought, according to this Reuters report.

We are talking about the world's main supplier of soybean meal and oil, which would have the lowest soybean production of the present century according to the projection of the Rosario Stock Exchange. Naturally, these items constitute the main source of foreign currency for the South American nation, totaling US$ 18,519 million in 2022.


Peruvian economic activity fell by 1.12% in the first month of 2023 compared to the same period of the previous year, after a positive dynamic that lasted 22 months, as a result of the atmosphere of violence and social disorder generated by the dramatic departure from power of Pedro Castillo in December.

Mining fell by 3.61 %, being one of the hardest-hit economic activities, according to data released by the National Institute of Statistics and Informatics and quoted by Reuters (let us remember that Peru is the second largest copper supplier in the world). The negative side of this note is that the effects of this fall are still to be felt, especially in the most vulnerable sectors.


Always active and controversial, Mexican President Andres Manuel López Obrador once again charged against the United States, claiming that the North American nation has failed in its fight against drugs, and proposed blocking the circulation of fentanyl (an issue that has recently gained the spotlight as a security problem) even for medicinal purposes, although it's claimed that very little is diverted to the illicit market from hospitals.

Mexican authorities deny that their country produces this narcotic, which claims some 70,000 overdose deaths annually in the United States. US officials claim instead that most of the illegal fentanyl comes out of clandestine Mexican laboratories that use Chinese raw materials (again the US-China crossover with any country in between). López Obrador expressed that he will inquire with doctors and experts whether all fentanyl use could be banned, in order to reduce illicit use. As you can see, the relationship between the United States and Mexico is one of those that never disappoints when it comes to news.


The region's currencies and stock markets experienced sharp declines as part of the fallout from the collapse of Silicon Valley Bank (SVB) and the fall of Credit Suisse shares, following the disclosure of a number of weaknesses in its financial reports.

The Mexican peso lost 2.07% from Tuesday's Reuters reference price; the main S&P/BMV IPC stock index, which concentrates the 35 most liquid companies in the market there, fell 1.12%. The Brazilian real retreated by 0.71%, while the Bovespa index of Sao Paulo's B3 stock exchange was able to cushion its loss and pause its decline by 0.25%.

The Mexican peso gave up 0.23%, while the Merval stock index plunged 4.82% (here the negative inflation figure of 6.6% in February, released yesterday, is playing a role). The Chilean peso lost 2.87%, moved down by its natural connection to the price of copper, the country's main export; the leading index of the Santiago Stock Exchange (IPSA) saw a backward movement of 1.9%.

The Colombian peso fell by 3.06%, and the benchmark MSCI COLCAP index followed with a downward trend of 3.84%. Finally, the Peruvian sol fell by 0.47%, while the Lima Stock Exchange benchmark fell by 1.11%.

This is all for our seventh 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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