Monday, January 20, 2014

South America News Roundup Sept 5, 2011: Chile, Uruguay, Brazil, Peru, Colombia

article from September 5, 2011
By Jamie Douglas

A lot has happened since my last news roundup.


Tragedy has struck in Chile, where a Chilean Air Force CASA-212 aircraft was lost with 21 people aboard while attempting to land in deteriorating conditions on Juan Fernandez Island, 400 miles off the Chilean coast. On board were several employees of Chile’s TVN, including Felipe Camiroaga, a beloved on-air personality. They were on the way to the island to do a follow-up report on the earthquake and tsunami damage and recovery from the February 2010 disaster that hit Chile. We would like to offer our sincere condolences to the people of Chile.

The last few weeks have brought a great deal of unrest to Chile in connection with President Piñera’s attempt to make education a “consumer good,” further entrenching the status quo by removing the state from any responsibility to educate the masses of poor Chileans and making quality education something only obtainable by the wealthy. Massive street demonstrations by all classes have shown their disapproval of his position, with the labor unions joining in the protests and calling for a two-day national strike. In the midst of all the chaos, a young boy was shot to death by the carabineros while he was pushing his brother in a wheel chair.

Meanwhile, the general director of the Chilean carabineros was forced to resign, after it was disclosed that he personally covered up his son’s culpability in a hit-and-run accident in Providencia. In his resignation letter, he claims to be stepping aside for health reasons while, of course, denying the allegations raised against him by the investigative group CIPER.


In good news from Uruguay, it was reported that consumer inflation has fallen slightly to 0.56%, or an annual rate of 7.57%, down from 8.25%. But one must keep in mind that these are “official figures” compiled by government technocrats. I am sure my correspondent, Guy in Uruguay, would take issue with these figures. While they no doubt represent a slight improvement over the previous month, they are still well below the targeted rate of 4-6%.

Unfortunately, Uruguay’s economy has been affected by the double-dip recession hitting the “developed” countries in the Northern Hemisphere. In July, the nation’s fiscal deficit ballooned to US$40 million, while in July 2010 there was a sizeable $55 million surplus.

The Uruguayan national oil company, ANCAP, announced that it will start exploring for oil in the inland regions of Tacuarembó and Salto, where the discovery of oil-eating bacteria, in higher concentration than in Argentina’s Neuquén Province, has led to speculation that there may be crude oil in them thar hills. Uruguay could certainly use natural resources of this type, as most of its energy sources originate from outside the country, fanning the flames of inflation and national deficit.


Brazil’s Presidenta Dilma Rousseff has just been anointed for a second term by her mentor, former President Lula da Silva, when he announced that he will step down from seeking a third term as president of that economic powerhouse, paving the way for her succession. President Rousseff has been challenged by the same entrenched corruption that plagued her predecessor, which ultimately brought her to the political forefront when she became Lula’s chief of staff before resigning that position to run for president, herself. But Brazil being Brazil, there is no telling what will happen there politically or fiscally in the next three years. The country is not isolated anymore from outside economic calamities, and the huge spending programs in progress now for the Olympic Games and the FIFA World Cup may yet end up draining the treasury. The infrastructure improvements that are necessary to make for a success of the games will have to be analyzed in terms of how much good they will bring to the country’s poor and undereducated. I personally would have liked to see this trillion dollars put into education, housing and sanitation projects in the rural areas that have so long been neglected. In the long run, that would provide security to the nation by allowing more of its citizens to climb the steep socio-economic ladder and eliminating the gap between the lowest class and the middle class.


In Peru, where the election of Ollanta Humala brought about a collapse of the Lima Stock Exchange because of fears that he would destroy the mining industry and drive investors away, things are going very well indeed. Ollanta Humala has become the darling of Wall Street and big investors. The mining companies that were so worried were happy to go along with his proposals to pay slightly higher royalties for minerals extracted in exchange for long-term commitments. This, in turn, will lead to more equal distribution of the wealth in a country that, like Brazil, suffers from abject poverty and lack of infrastructure in rural areas. We wish him and the good people of Peru much success in this new endeavor.


And poor Colombia: Whenever that cocaine-cursed nation seems to be coming out of one crisis, it enters the next. The gold mining industry, an enterprise with the potential to eclipse the drug trade, is being plagued by all the usual suspects with terrorism, extortion, kidnappings and violence. I am rooting for Colombia to be able to leave the legacy of the cocaine cowboys behind. Colombia’s citizens are hard working, aspiring to be more than what they have been limited to by circumstances beyond their control; but through no fault of their own, they have repeatedly been victimized by the crime lords, the paramilitaries and fear of the dark. The current administration came into office on the heels of some great gains, but it seems that for every step forward, they slide back two. Large portions of the country are considered unsafe and unstable, so much so that not even the military is established there. Nobody seems to have a solution to these peculiar problems plaguing Colombia, but the time has come for a renewal.

Jamie Douglas
San Rafael, Mendoza
Where the Malbec grape vines are starting to sprout!

I encourage you to write me at cruzansailor [at] gmail [dot] com with any questions or suggestions you may have. Disclaimer: I am not in any travel-related business. My advice is based on my own experiences and is free of charge (Donations welcome). It is always my pleasure to act as a beneficial counselor to those who are seekers of the next adventure.