The trade dependence between the two countries - greater in the case of Brazil, but the Chinese also need certain Brazilian products, such as soybeans - ensures the understanding between the two countries.

The relationship between Brazil and China has proven to be particularly pragmatic: neither Jair Bolsonaro has reviewed the link with the Asian country as he promised before becoming president (in his first year in office he has not only kept Brazil in the BRICS but even made a highly publicized official trip to Beijing), nor has Xi Jinping punished his partner for having accused him of mismanaging the coronavirus pandemic, as has happened with other countries. The convenience of mutual trade relations, revalued by the trade war between China and the US and by the present world crisis, has prevailed.

▲ Jair Bolsonaro and Xi Jinping in Beijing in October 2019 [Planalto Palace].

article / Túlio Dias de Assis

After years of criticizing the "perverse communist government of Beijing", Jair Bolsonaro surprised at the end of last October with a state visit to the Forbidden City, which he himself specially publicized on social networks. On that trip he gave Xi Jinping the jersey of the Club de Regatas do Flamengo (the soccer team that at that time represented Brazil in the Libertadores Cup, which he would end up winning) and expressed his total conviction of being in a capitalist country. In November he hosted a BRICS summit in Brasilia.

Bolsonaro's policy toward China had already begun to change since shortly after acceding to the presidency in January 2019, in contrast to his anti-China messages during the election campaign.

In fact, diplomatic relations between the two countries date back to the time of the military board of which Bolsonaro sample so proud. In 1974, Brazil recognized the People's Republic of China as the only China, thus allowing, despite being unaware of it at the time, the creation of a huge trade link between the two nations of continental proportions. Since then, as China's openness to China progressed, relations between China and Brazil have been increasing, so that for almost a decade now China has been Brazil's main trading partner . China's dependence on Brazil is also remarkable in relation to some products, such as soybeans, although for the Chinese Brazil is the twentieth trading partner , since logically they are economies of very different sizes.

When in 1978 Deng Xiaoping decided to open up Chinese Economics to the rest of the world, Chinese GDP was close to $150 billion, 75% of Brazil's, which was already over $200 billion. Four decades later, in 2018, Brazilian GDP was $1.8 trillion and Chinese GDP was $13.6 trillion.

Soybeans and swine

Brazil's greatest commercial and even political rapprochement with China occurred during the presidency of Luiz Inácio 'Lula' da Silva, during which the BRICS was formed, a club that helped create a greater level of economic and diplomatic proximity between member countries. This rapprochement led China to become Brazil's leading trading partner in terms of exports and imports. Brazil's sales to China almost double exports to the US.

Although trade with Brazil represents less than 4% of the total value of goods imported by China annually, the South American country continues to be an important trading partner for the People's Republic, due to the fact that the main product imported from Brazil is soybeans, one of the usual per diem expenses instructions for a large part of the Chinese population. More than half of the soybeans imported by China come from Brazil and the trend is to increase, mainly due to the trade war with the USA - the second main exporter of soybeans to China -, thus making Brazil practically the breadbasket of the Middle Kingdom. China is the destination of more than 70% of Brazilian soybean production.

Dependence on China, from the Brazilian consumer's perspective, was accentuated at the end of 2019 due to an exorbitant rise in the price of meat. The average between the different Brazilian states hovered between 30% and 40% compared to previous months. Producers were able to substantially increase their profits in the short term, but the popular classes openly protested the uncontrolled price of a product very present in the usual per diem expenses of the average Brazilian. The rise in prices was due to a combination of factors, among them an outbreak of swine fever that devastated a large part of Chinese production. Faced with a shortage of supply in its domestic market, China was forced to diversify its suppliers, and being in the midst of a trade war with the USA, China had no choice but to turn to the Brazilian agricultural potential, one of the few capable of meeting the great Chinese demand for meat. During this period - a brief one, as it gradually returned to the previous status - Brazil obtained a certain coercive power over the Asian giant.

Huawei and credits

Brazil is in a status of extreme dependence on China in technological subject : more than 40% of Brazil's purchases from China are machinery, electronic devices or parts thereof. Already in the last decade, with the arrival of the smartphone and fiber optics revolution in Latin America, Brazil decided to bet more on Chinese technology, thus becoming one of the main international markets for the now controversial Huawei brand, which has come to dominate 35% of the Brazilian cell phone market. While the US and Europe were suspicious of Huawei and from the beginning placed limits on its markets, Brazil saw Chinese technology as a cheaper way to develop and never let itself be swayed by suspicions of Chinese government interference in privacy subject . Even several deputies of the PSL (former party to which Bolsonaro belonged) visited China in early 2020 to evaluate the possibility of acquiring Chinese facial recognition equipment to help state security forces in the fight against organized crime, a proposal that was ultimately rejected by the Parliament.

With the rise of the controversy about the risks of espionage that the use of the Chinese multinational's technology may pose, some voices have warned of the threat that Huawei's contracting may pose to many government agencies and offices: a couple of embassies and consulates, part of the infrastructure of the Chamber of Deputies, and even the headquarters of the Federal Prosecutor's Office and the Federal Justice in some federal states. Although given the lack of accusatory evidence against Huawei, little has been done by the government about it; only the cancellation of some purchases of Huawei devices has been given.

Brazil is the country that has received the second most public loans from China in Latin America: $28.9 billion (Venezuela is the first with $62.2 billion), spread over eleven loans between 2007 and 2017, of which nine come from the Chinese development Bank and two others from the Export-Import Bank of China. Despite being a high value, it represents a very small percentage of the Brazilian public debt, which already exceeds one trillion dollars. Most of the loans granted by Beijing have been earmarked for the construction of infrastructure for resource extraction. In addition, Chinese companies have invested in the construction of two ports in Brazil, one in São Luís (Maranhão State) and the other in Paranaguá (Paraná State).

Coronavirus rhetoric

Bolsonaro soon realized his dependence on China and opted for a policy of accommodation towards Beijing, far from his election campaign messages. Once again, then, Brazil was betting on pragmatism and moderation, as opposed to ideology and radicalism, in terms of Itamaraty (Ministry of Foreign Affairs) policy. Likewise, in the face of the instability caused by the US-China trade war and Trump's current weak position, Bolsonaro was demonstrating pragmatism by not closing himself off to high-potential trade partners because of his ideology, as was seen last November at the BRICS summit in Brasilia.

But sometimes a rhetoric emerges that is in line with the original thinking. In the wake of the coronavirus pandemic, Bolsonaro has copied Trump's anti-China narrative in some messages. A good example is the exchange of tweets that took place between Eduardo Bolsonaro, federal deputy and eldest son of the president, and the Chinese ambassador, Yang Wanming. The former compared the coronavirus to the Chernobyl accident, insinuating total irresponsibility, negligence and concealed information on the part of the Chinese Communist Party. The ambassador responded that the president's son "on his last trip to the US did not contract the coronavirus, but a mental virus", referring to his ideological proximity to Trump.

However, all this status seems to have calmed down after a call between the presidents of both countries, in which both reaffirmed their commitments, especially those of a commercial and financial nature. Also, once again Bolsonaro seems to follow Itamaraty's traditional line of neutrality, despite the constant insistence of his instructions to blame China for the current tragedy. It is clear that the economic dependence on China is still much stronger than the ideological principles of Bolsonaro's political base, however Trumpist it may be.

One of the main instruments for combating poverty loses its relevance between the end of the "golden decade" and the beginning of the "second lost decade

The so-called Conditional Cash Transfers (CCTs) submission cash transfers to underprivileged families with a commitment to schooling, medical check-ups or other basic requirements that, along with improving household income, sought to promote the options of the younger generation - have helped in the last two decades to significantly increase theaverage class in Latin America. But once the subsistence level was surpassed, citizens recently began to demand improved services, such as teaching, healthcare or transportation - as seen in the protests of recent months in the region - to which the CCTs no longer provided an answer. Just when the countries were thinking of readapting their policies in response to this change of perspective, the crisis triggered by Covid-19 threatened to throw millions of people back into poverty, making cash transfers necessary once again, this time without conditionalities.

▲ Beneficiaries of Brazil's Bolsa Família, one of the pioneering conditional cash transfer programs [Gov. of Brazil].

article / María Gabriela Fajardo

The first Conditional Cash Transfer (CCT) programs in Latin America, a pioneer region in the implementation of this instrument, were developed in the mid-1990s in Brazil and Mexico with the intention of "transforming and halting the intergenerational transmission of poverty through the development of human capabilities in the most vulnerable families," as stated in a report by ECLAC (United Nations Economic Commission for Latin America and the Caribbean). CCTs were designed to provide support to families status poverty or extreme poverty with minor children. The submission these monetary aids (also non-monetary) was made as long as the families complied with basic conditions of health, Education and nutrition of the minors.

The implementation of CCTs spread rapidly throughout the region. In 1997, only four countries had any of these programs: Brazil (Bolsa Escola), Ecuador (Bono Solidario), Honduras (Programa de Asignación Familiar) and Mexico (Progresa). A decade later, almost all Latin American countries had adapted the initiative.

Although in some cases this tool has been controversial, given that some governments have been able to use it as "an instrument of social policy and its targeting is discussed as a strategy to address actions that must operate under restricted budgets", according to the aforementioned ECLAC report , the truth is that CCTs are considered to have contributed to the socioeconomic progress of the region. This was recently pointed out by Alejandro Werner, director for the Western Hemisphere of the International Monetary Fund (IMF). "In the last 15 years," he said, attributing part of the credit to CCTs, "important progress has been made in the topic poverty alleviation and reduction of income maldistribution. Thus, Latin America is probably the region with the greatest improvement in income distribution.

Between 2002 and 2014, a time known in Latin America as the "golden decade" (a consequence of the commodities boom ), the poverty rate in the region fell from 45.4% to 27.8%, so that 66 million people overcame that status, agreement to the Social Panorama of Latin America 2019 published by ECLAC. Additionally, the extreme poverty rate decreased from 12.2% to 7.8%. However, since 2015, the level of poverty and extreme poverty began to increase, a patron saint that has continued since then, albeit moderately. For 2019, ECLAC predicted an increase in poverty and extreme poverty to fees of 30.8% and 11.5%, respectively, so that 27 million more people returned to situations of poverty compared to 2014. 

The challenge: from extreme poverty to the class average

This slight reversal indicates that many who in that "golden decade" gained access to the class average, making this sector of the population a majority for the first time, now find themselves in a high Degree of vulnerability Degree At the same time, these people have seen how, having overcome their previous survival status , their expectations of subsequent progress and access to better services from the State have not been met. The new challenge in many countries was to make public policies revolve around other factors that would allow the consolidation of these people in the class average. This neglect generated discontent that contributed to the large protests experienced in several Latin American countries at the end of 2019.

The greater demands of a population in better conditions made structural deficiencies more evident. "The region's structural deficiencies have become more evident and their solution is part of the demands of broad social groups, particularly the new generations," according to the Social Panorama report . Specifically, ECLAC warned about "segmented access to quality public and cultural services".

In Werner's words, "having achieved such a significant reduction in the reduction of poverty also generates an important challenge for policy makers in Latin America, since the design of social policies must be oriented to address other factors, not to the reduction of extreme poverty. It is not that we have to forget about that, but clearly the challenge now is to focus also on addressing those segments of the population that are no longer in poverty, which are class average". After highlighting the precariousness of this large group of the population that has moved up the social ladder, the IMF manager for the Western Hemisphere indicated that "clearly the instruments to address this vulnerability are different from the conditional transfer schemes that were implemented in the past", and he specifically mentioned access to quality Education and health.

But the States have faced the need for this paradigm shift without budgetary support. It is evident that there is little state reaction capacity to meet the new needs of the vulnerable population affected by low educational levels, few work opportunities and the inefficiency of the pension system.

The countries have found that economic growth, which between 2000 and 2013 hovered jointly around 2%, has been weakening since 2014. Thus, real GDP per capita in the region has declined by 0.6% per year. The causes of this decline in economic growth can be classified into two factors, as explained by Werner. First, structural causes have inhibited potential growth due to "the scarcity of investment, slow productivity growth, a Pass business climate, leave infrastructure quality and Education". Secondly, within the cyclical causes, the weak global economic growth and the low price of raw materials have also affected the uncertainty of large regional economies such as Brazil and Mexico, the sudden economic stoppages of stressed economies such as Argentina and Ecuador, and the social tensions that took place in the last quarter of 2019.

Coronavirus

The emergence of the Covid-19 pandemic has worsened the economic outlook for Latin America and the Caribbean, for which the April 2020 report forecasts a 5.2% drop in GDP this year. Although the IMF estimates a recovery of 3.4% in 2021, this will not be enough to allay fears of a new "lost decade". In his most recent intervention to comment on these data, Werner warned that between 2015 and 2025 GDP per capita "will be flat".

To cope with this new status, socially aggravated by the health crisis and the suffering of so many people, governments are resorting to direct cash transfers, no longer conditional, to vulnerable households. In a way, we are returning to a stage of need, even prior to the moment when CCTs were extended. We are returning to the urgency of the 1980s, known in Latin America as the lost decade, when countries had to apply shock measures to get out of a serious public debt crisis.

The president of the Inter-American development Bank (IDB), Luis Alberto Moreno, believes that it is still too early to speak of a second lost decade, but agrees that the moment leads to unconditional transfer programs. "The big question is whether everything we have achieved in the last 15 years in terms of reducing poverty and extreme poverty, with the incorporation of some Latin Americans into the middle classes, will be lost or whether, on the contrary, the capacity of the social systems and the governments' drive to increase debt and public expense will cushion the effects," Moreno said. All the countries "are strengthening the transfer programs that were developed almost two decades ago, and which have been very successful", although "in this case they will not be conditional, in order to preserve the income of many families".

[Scott Martelle, William Walker's Wars. How One Man's Private Army Tried to Conquer Mexico, Nicaragua, and Honduras. Chicago Review Press. Chicago, 2019. 312 p.]

review / Emili J. Blasco

The history of U.S. interference in Latin America is long. In plenary session of the Executive Council Manifest destiny of expansion towards the West in the mid-nineteenth century, to extend the country from coast to coast, there were also attempts to extend sovereignty to the South. Those who occupied the White House were satisfied with half of Mexico, which completed a comfortable access to the Pacific, but there were personal initiatives to attempt to purchase and even conquer Central American territories.

One of those initiatives was led by William Walker, who at the head of several hundred filibusters -the American Falange-, snatched the presidency of Nicaragua and dreamed of a slave empire that would attract the investments of American Southerners if slavery was abolished in the United States. Walker, from Tennessee, first tried to create a republic in Sonora, to integrate that Mexican territory into the United States, and then focused his interest on Nicaragua, which was then an attractive passage for Americans who wanted to cross the Central American isthmus to the gold mines of California, where he himself had sought his fortune. Disallowed and detained several times by the US authorities, due to the problems he caused them with the neighboring governments, he was finally expelled from Nicaragua by force of arms and shot to death when he tried to return, setting foot in Honduras.

Scott Martelle's book is both a portrait of the character - someone without special leadership skills and with a rather delicate appearance unbecoming of a mercenary chief, who nevertheless knew how to generate lucrative expectations among those who followed him (2,518 Americans came to enlist) - and a chronicle of his military campaigns in the South of the United States. It also describes well the mid-19th century atmosphere in cities like San Francisco and New Orleans, full of migrants coming from other parts of the country and in transit to wherever fortune would take them.

It also offers a detailed account of the business developed by the magnate Vanderbilt to establish a route, inaugurated in 1851, that used the San Juan River to reach Lake Nicaragua and from there to go out to the Pacific, with the intention of establishing a railroad connection and the subsequent purpose of building a canal in a few years. Although the overland route was longer than the one that at that time was also being traced under similar conditions on the Isthmus of Panama, the boat trip from the United States to Nicaragua was shorter than the one that had to be made to Panama. The latter explains why, during the second half of the 19th century, the Nicaragua canal project had more supporters in Washington than the Panama project.

Although Panama is one of the symbols of US interference in its "backyard", the success of the transoceanic canal project and its return to the Panamanians largely deactivates a "black legend" that still exists in the Nicaraguan case. Nicaragua is probably the Central American country that has experienced the most US "imperialism". The Walker episode (1855-1857) marks a beginning; then followed the US government's own military interventions (1912-1933), Washington's close support for the Somoza dictatorship (1937-1979) and direct involvement in the fight against the Sandinista Revolution (1981-1990).

Walker arrived in Nicaragua attracted by the U.S. interest in the inter-oceanic passage and with the excuse of helping one of the sides fighting in one of the many civil wars between conservatives and liberals that were taking place in the former Spanish colonies. Elevated to chief of the Army, in 1856 he was elected president of a country in which he could barely control the area whose center was the city of Granada, on the northern shore of Lake Nicaragua.

As he established his power, he moved away from any initial idea of integrating Nicaragua into the United States and dreamed of forging a Central American empire that would even include Mexico and Cuba. Slavery, which in Nicaragua had been abolished in 1838 and he reinstated in 1856, entered into his strategy. He imagined it as a means of preventing Washington from renouncing to extend its sovereignty to those territories, given the internal balances in the US between slave and non-slave states, and as a capital attraction for southern slaveholders. He was finally expelled from the country in 1857 thanks to the push of an army assembled by neighboring countries. In 1860 he attempted a return, but was captured and shot in Trujillo (Honduras). His adventure was fueled by the belief in the superiority of the white and Anglo-Saxon man, which led him to despise the aspirations of the Hispanic peoples and to overestimate the warlike capacity of his mercenaries.

Martelle's book responds more to a historicist purpose than an informative one, so its reading is not so much for the general public as for those specifically interested in William Walker's fulibusterism: an episode, in any case, of convenient knowledge about the Central American past and the relationship of the United States with the rest of the Western Hemisphere.

[Maria Zuppello, Il Jihad ai Tropici. Il patto tra terrorismo islamico e crimine organizzato in America Latina. Paese Edizioni. Roma, 2019. 215 p.]

review / Emili J. Blasco

We usually link jihad with the Middle East. If anything, also with the African Sachel, opening the map to the west, or with the border of Afghanistan, Pakistan and India, opening it to the east. However, Latin America also has a place in this geography. It has it as a place for financing the terrorist struggle - cocaine is a business that the Islamists take advantage of, as happens with heroin in the specific case of the Taliban - and also as a space in which to go unnoticed, off the radar (the Caribbean or Brazilian beaches are the last place that would be imagined as a hiding place for jihadists).

Jihad in the Tropics, by Italian researcher Maria Zuppello, deals precisely with that lesser-known aspect of global jihadism: the caipirinha jihadists, to put it graphically, to emphasize the normality with which these radicalized elements live in the Latin American context, although they are criminal networks more sinister than the name might suggest.

Zuppello's research , which is subtitled "the pact between Islamic terrorism and organized crime in Latin America", deals with various countries, although it is in Brazil where the author locates the main connections with the rest of the region and with the international Structures of various jihadist groups. In particular, she points out the link between the religious leader Imran Hosein, who propagates Salafist doctrines, and the attack against the Bataclan conference room in Paris, since his preaching had a special responsibility in the radicalization of one of the terrorists, Samy Amimour. Zuppello also analyzes the cross-contacts of the Brazilians who were arrested in 2016 in the Hashtag operation, in the final stretch of the preparation for the Olympic Games in Rio de Janeiro.

Zuppello's book begins with a presentation position Emanuele Ottolenghi, a researcher working at the Foundation for Defense of Democracies, a Washington think tank. Ottolenghi is an expert on Hezbollah's presence in Latin America, on which he has written numerous articles.

In that presentation, Ottolenghi highlights the partnership established between jihadist elements and certain levels of the Latin American left, especially the Bolivarian left. "The extremist messages differ little from the anti-imperialist revolution rhetoric of the radical left, deeply rooted for decades in Latin America," he says. This explains "the appeal of the Islamic revolution to descendants of the Incas in the remote Andean community of Abancay, a four-hour drive from Machu Picchu, and to Cuban and Salvadoran revolutionaries (now dedicated to spreading Khomeini's word in Central America)."

For Ottolenghi, "the central topic of the red-green alliance between Bolivarians and Islamists is the so-called resistance to U.S. imperialism. Behind this revolutionary rhetoric, however, there is more. The creation of a strategic alliance between Tehran and Caracas has opened the door to Latin America for the Iranian Revolutionary Guards and Hezbollah. Venezuela has become a hub for Iran's agents in the region".

Illicit trafficking generates millions of dollars of black money that is laundered through international circuits. The "Lebanese diaspora communities" in areas such as La Guaira (between Venezuela and Colombia), Margarita Island (Venezuela), the free trade zone of Colon (Panama) and the Triple Border (between Brazil, Paraguay and Argentina) are important in this process.

Precisely that Triple Border has been the usual place to refer to when talking about Hezbollah in Latin America. The attacks occurred in Buenos Aires in 1992 and 1994 against the Israeli Embassy and the AMIA, respectively, had their operative origin there and since then, the financial links of that geographic corner with the Shiite extremist group have been frequently documented. Since the arrival of Hugo Chávez to power, there was a convergence between Venezuela and Iran that protected the obtaining of Venezuelan passports by Islamist radicals, who also took over part of the drug trafficking business as Chávez himself involved the Venezuelan state in the cocaine business.

The convergence of interests between organized crime networks in the region and jihadist elements raises the question, according to Zuppello, of whether "Latin America will end up being the new cash machine for financing global jihad", or even "something else: a hideout for fleeing foreign fighters or a new platform for attacks, or both".

One of the specific aspects to which Zuppello refers is the halal sector and its certifications, which is growing exponentially, causing concern among counter-terrorism authorities in various countries, who accuse the sector of concealing terrorist financing and money laundering. The halal meat trade has provided cover for dozens of Iranian meat inspectors, who have permanently settled in the region.

Investigations such as the one carried out in Jihad in the Tropics have led to the recognition of Hezbollah as a terrorist group by several Latin American countries for the first time in 2019.

27% of Latin America's total private wealth is deposited in territories offering favorable tax treatment

Latin America is the world region with the highest percentage of private "offshore" wealth. The proximity of tax havens, in various countries or island dependencies in the Caribbean, can facilitate the arrival of these capitals, some generated illicitly (drug trafficking, corruption) and all evaded from national tax institutions with little supervisory and coercive force. Latin America missed out on taxes in 2017 to the tune of $335 billion, which represented 6.3% of its GDP.

▲ Caribbean beach [Pixabay].

article / Jokin de Carlos Sola

The natural wealth of Latin American countries contrasts with the precarious economic status of most of their societies. Lands rich in oil, minerals and primary goods sometimes fail to feed all their citizens. One of the reasons for this deficiency is the frequency with which companies and leaders tend to evade taxes, driving capital away from their countries.

One of the reasons for the tendency to evade taxes is the large size of the underground Economics and the shortcomings of the States to implement tax systems. Another is the close presence of tax havens in the Caribbean, basically linked historically to the United Kingdom. These territories with beneficial tax characteristics have attracted capital from the continent.

History

The history of tax evasion is long. Its relationship with Latin America and the British Caribbean archipelagos, however, has its origins in the fall of the British Empire.

Beginning in 1945, Britain gradually began to lose its colonial possessions around the world. The financial effect was clear: millions of pounds were lost or taken out of operations throughout the empire. To cope with this status and to be able to maintain their global financial power, the bankers of the City of London thought of creating fields of action outside the jurisdiction of the Bank of England, from where bankers from all over the world (especially Americans) could also operate in order to avoid their respective national regulations. A new opportunity then arose in the British overseas territories, some of which did not become independent, but maintained their ties, albeit loose, with the United Kingdom. This was the case of the Caribbean.

In 1969 the Cayman Islands created the first banking secrecy legislation. It was the first overseas territory to become a tax haven. From offices established there, the City banks were generating networks of operations unregulated by the Bank of England and with hardly any local supervision. Soon other Caribbean jurisdictions followed in the same footsteps.

Tax havens

The main tax havens in the Caribbean are British overseas territories such as the Cayman Islands, the Virgin Islands and Montserrat, or some former British colonies that later became independent, such as the Bahamas. These are islands with small populations and small Economics . Many of the politicians and legislators in these places work for the British financial sector and ensure secrecy within their territories.

Unlike other locations that can also be considered tax havens, the British-influenced islands of the Caribbean offer a second level of secrecy in addition to the legal one: the trust. Most of those who hold assets in companies established in these territories do so through the figure of the trust. Under this system the beneficiary holds his assets (shares, properties, companies, etc.) in a trust which is administered by a trustee. These elements (trust, beneficiary, trustee, shell companies, etc.) are distributed in different Structures linked to different Caribbean jurisdictions. Thus, a trust may be established in one jurisdiction, but its beneficiaries may be in a different one, the trustee in a third and the shell companies in a fourth. This is a subject of Structures that are almost impossible for governments to dismantle. Therefore, when overseas governments undertake to share banking information, under pressure from Washington or Brussels, it is of little use because of the secrecy structure itself.

Impact in Latin America

Bank secrecy legislation arose in Latin America with the goal of attracting capital obtained in a licit manner. However, during the 1970s and 1980s, this protection of current account data also attracted capital obtained through illicit means, such as drug trafficking and corruption.

During those years, drug lords such as Pablo Escobar used the benefits of the Cayman Islands and other territories to hide their fortunes and properties. On the other hand, several Latin American dictatorships also used these mechanisms to hide the enrichment of their leaders through corruption or even drugs, as happened with Panama's Manuel Noriega.

Over time, the international community has increased its pressure on tax havens. In recent years the authorities in the Cayman Islands and the Bahamas have made efforts to ensure that their secrecy Structures are not used to launder money for organized crime, but not all territories considered tax havens have done the same.

These opaque networks are used by a considerable part of Latin America's great fortunes. Twenty-seven percent of Latin America's total private wealth is deposited in countries that offer favorable tax treatment, making it the region in the world with the highest proportion of private capital in those places, agreement to a 2017 Boston Consulting Group study. According to this consulting firm, this diversion of private wealth is greater in Latin America than in the Middle East and Africa (23%), Eastern Europe (20%), Western Europe (7%), Asia-Pacific (6%) and the United States and Canada (1%). 

Tax havens are the destination of a difficult-to-precise part of the total of 335 billion dollars subject to tax evasion or avoidance that there was in the region in 2017, a figure that constituted 6.3% of Latin American GDP (4% left out of income tax for individuals and 2.3% in VAT), as specified in ECLAC'sFiscal Panorama of Latin America and the Caribbean 2019 report . This UN economic commission for the region highlights that on average Latin American countries lose more than 50% of their income tax revenues.

The connection with London

There have been several theories about the role played by London in relation to tax havens. These theories coincide in presenting a connection of interests between the opaque companies and the City of London, in a network of complicity in which even the Bank of England and the British government could have participated.

The most important one was expressed by the British author Nicholas Shaxson in the book Treasure Island. The thesis was later developed by the documentary film Spiders Web, produced by the Tax Justice Network, whose founder, John Christiansen, worked as an advisor to the government of Jersey, which is a special jurisdiction.

The City of London has a separate administration, elected by the still existing guilds, which represent the commercial and banking class of the city. This allows financial operations in this area of the British capital to partially escape the control of the Bank of England and government regulations. A City that is attractive to foreign capital and prosperous greatly benefits British Economics , since its activity accounts for 2.4% of the country's GDP.

British sovereignty over the overseas territories that serve as tax havens sometimes leads to accusations that the United Kingdom is complicit with these financial networks. Downing Street responds that these are territories that operate with a great deal of autonomy, even though London sets the governor, controls foreign policy and has veto power over legislation passed in these places.

In addition, it is true that the UK government has in the last decade supported greater international coordination to increase scrutiny of tax havens, forcing the authorities there to submit relevant tax information, although the structure of the trusts still works against transparency.

Correcting the status

Latin America's problems with tax evasion may be more related to the fragility of its own fiscal institutions than to the presence of tax havens close to the American continent. At the same time, some tax havens have benefited from political instability and corruption in Latin America.

The effects of the flight of national capital to these places with special tax regimes are clearly negative for the countries of the region, as it deprives them of greater economic activity and revenue-raising possibilities, thus hindering the State's capacity to undertake the necessary improvement of public services.

It is therefore imperative that certain corrective policies be established. In the field of national policies, mechanisms should be created to prevent tax evasion and avoidance. At the same time, at the international level, diplomatic initiatives should be set up to put an end to the Structures of the trusts. The OAS offers, in this sense, an important negotiating framework not only with certain overseas territories, but also with its own metropolises, since these, as is the case of the United Kingdom, are permanent observer members of the hemispheric organization.

Criticism of Maduro, the redimensioning of the Chinese embrace and greater immigration control mark the harmony with Washington after ten years of the FMLN

The surprising use of the army to pressure the Salvadoran Legislative Assembly in early February to approve a security appropriation has raised international alarm about what the presidency of Nayib Bukele, who came to power in June 2019, may hold. Having tightened relations with the United States in his first half year, after two decades of government by the former FMLN guerrillas, Bukele may have thought that his authoritarian gesture would be excused by Washington. The unanimous reaction in the region made him correct the shot, at least for the time being.

▲ Swearing in of Nayib Bukele as president, in June 2019, together with his wife, Gabriela Rodríguez [Presidency of El Salvador].

article / Jimena Villacorta

El Salvador and the United States had a close relationship during the long political dominance of the right-wing ARENA party, but the coming to power in 2009 of the Farabundo Martí National Liberation Front (FMLN) meant an alignment of El Salvador with the ALBA countries (Venezuela, Nicaragua and Cuba, fundamentally), which led to occasional tension with Washington. In addition, in 2018, in the final stretch of the presidency of Salvador Sánchez Cerén, diplomatic relations with Taiwan were severed and the possibility of strategic investments by China was opened, which were viewed with suspicion by the United States (especially the option of controlling the Pacific port of La Unión, due to the risk of its military use in a crisis status ).

Nayib Bukele won the early 2019 elections presenting himself as an alternative to the traditional parties, despite the fact that he was mayor of San Salvador (2015-2018) leading a coalition with the FMLN and that for the presidential elections he stayed with the GANA acronym, created a few years earlier as a split from ARENA. His denunciation of the corruption of the political system, in any case, was credible for the majority of an electorate certainly tired of the Bolivarian tone of recent governments.

During his electoral campaign Bukele already advocated for improving relations with the United States, as it is a more economically interesting partner for El Salvador than the ALBA nations. "All financial aid that comes is welcome and better if it is from the United States", said one of his advisors. These messages were immediately received in Washington, and in July the US Secretary of State, Mike Pompeo, visited El Salvador: it was the first time in ten years, precisely the time of the two consecutive presidencies of the FMLN, that the head of US diplomacy visited the Central American country. This trip served to accentuate the partnership in subject fight against drug trafficking and the gang problem, two shared problems. "We have to fight against the MS-13 gang, which has sown destruction in El Salvador and also in the United States, because we have its presence in almost forty of the fifty states of our country," said Pompeo.

In line with the change of orientation that was taking place, El Salvador began to align itself in regional forums against the regime of Nicolás Maduro. Thus, on September 12, the Salvadoran representation in the Organization of American States (OAS) supported the activation of the Inter-American Reciprocal attendance Treaty (TIAR), after years of abstaining or voting in favor of resolutions supporting Chavez's Venezuela. On December 3, Bukele announced the expulsion from El Salvador of Maduro's government diplomats, an action immediately replicated by Caracas.

In those same months El Salvador accepted the terms of the new immigration approach that the Trump Administration was outlining. During the summer, the White House negotiated with the countries of the Central American Northern Triangle agreements similar to the safe third country mechanism, whereby Guatemala, Honduras and El Salvador agreed to process as asylum seekers those who had passed through their territory and ended up in the US by formalizing that application. Bukele met with Trump in September in the framework the United Nations General Assembly and signed the agreement, which was presented as an instrument to combat organized crime, strengthen border security, reduce illegal trafficking and human trafficking. 

The signature the agreement was controversial, as many authorities questioned the guarantees of security and protection of rights that El Salvador can offer, when it is the lack of such guarantees that is driving the emigration of Salvadorans. Rubén Zamora, former ambassador of El Salvador to the UN, criticized that Bukele was conceding a lot to the United States, with hardly anything in return.

Bukele, however, was able to exhibit in October a US counterpart: the extension for one year, until January 2021, of the Temporary Protected Status (TPS) that gives legal coverage to the presence of 250,000 Salvadorans and their families in the US. The total number of Salvadorans residing in that country amounts to at least 1.4 million, the largest number of Latin American migrants after Mexicans. This sample the great link of the Central American nation, where 6.5 million people live, with the great power of the North, which is also the destination of 80% of its exports and whose dollar is the currency of use in El Salvador.

The new Salvadoran president seemed to truncate this harmony with Washington in December, when he made an official trip to Beijing and met with the Chinese leader, Xi Jinping. The US had warned of the risk of China taking strategic advantage of the door that was opening in Central America with the subsequent establishment of diplomatic relations with the countries of the American isthmus, which until a few years ago were a stronghold of support for Taiwan. Specifically, the US embassy in El Salvador had been particularly active in denouncing the alleged efforts of the Sanchez Ceren government to grant China the management of the Port of La Union, in the Gulf of Fonseca, which could be joined by a special economic zone.

However, what Bukele did on that trip was to resize, at least for the time being, that relationship with China, limiting expectations and calming U.S. suspicions. Not only does the question of the port of La Unión seem to have been shelved, but the Salvadoran president also confined Chinese attendance to the field of non-repayable financial aid to development and not to the granting of credits which, in the event of non-payment, condition national sovereignty. Bukele pointed out that the "gigantic cooperation" promised by China was "non-refundable" and referred to typical international cooperation projects, such as the construction of a library, a sports stadium and a sewage treatment plant to clean the sewage discharged into Lake Ilopango, near the capital.

The port of Chancay, to be position by the state-owned shipping company Cosco, will start operations in 2022.

The Chinese pronounce it almost like Shanghai, but it is not in China but in Peru. The port of Chancay, 75 kilometers from Lima, will become the first Chinese logistics hub for the Pacific side of Latin America. It is the only port in the region for the state-owned shipping company Cosco, which once established in Piraeus its entrance to Europe and is now preparing its access of goods to South America through Chancay. The infrastructure represents an investment of 3 billion dollars.

Computer-aided design of the facilities of the new port of Chancay, 75 kilometers north of Lima [Volcan].

article / Gabriela Pajuelo

The port of Chancay intends to become one of China's main connections with the countries on the west coast of South America, serving as a bridge for the growing trade of goods from this region with Asia-Pacific. Through the company Terminales Portuarios Chancay, China's Cosco Shipping Ports is contemplating an initial investment of US$1.2 billion, earmarked for the first phase of the project - construction of new dikes to gain ground to the sea, achieving a greater depth (16 meters) and surface area for operations (one million containers). The total investment will be US$3 billion; entrance into operation is scheduled for 2022.

China has been Peru's leading trading partner since 2014, replacing the United States. In 2017 China was the destination of 26% of Peruvian exports (US$11.7 billion) and the origin of 23% of its imports (US$8.75 billion). Chinese interest is focused on minerals, the largest Peruvian export sector, and therefore the port of Chancay is emerging as the main exit point for these raw materials to China. Return freight will bring Chinese manufactured goods, not only to Peru but also to neighboring countries.

Beijing's interest in Peru's raw materials already led to the signature in 2009 of a free trade agreement between the two countries, which was optimized last year. It is a relationship that has not been complicated by the granting of large loans that the recipient country then finds it difficult to refund: Peru has only received loans from Chinese public lending institutions amounting to US$ 50 million in 2009, which places it at the bottom of the list of recipients of Chinese loans in Latin America.

Cosco acquired 60% of Terminales Portuarios Chancay for US$225 million in the first half of 2019, sharing a partnership with the Peruvian mining company Volcan, which owns the remaining 40%. This is the first port that the large Chinese state-owned shipping company will control in its entirety in the Western Hemisphere, since its presence in the port of Seattle, in the USA, is limited to the operation of a terminal. Cosco has 34 terminals worldwide, 11 of which are outside China (in Spain it has a presence in the ports of Valencia and Bilbao). Other Chinese companies also have terminals in the region, such as at the mouths of the Panama Canal (China is the second largest Username of this inter-oceanic waterway, after the USA), or are involved in port expansion works, such as in Itaqui (Brazil). Beijing has also expressed interest in managing complete ports -the case of La Unión, in El Salvador-, but Chancay is the first project in this sense.

The new port of Chancay, covering almost 1,000 hectares, will include an entrance complex, a subway viaduct tunnel, and an operational port area. This will have a container terminal with two piers, and a bulk, general cargo, and roll-on/roll-off terminal with another two piers. According to the company, the port will have an annual cargo handling capacity of one million TEUs (Twenty-foot Equivalent Unit). It should be added that the port complex will have the capacity to unload Triple E vessels, considered the second largest container ships in the world.

The multi-port is located 75 km north of Lima and will be connected to the center of the country via a highway to Oyón and Ambo, in the Peruvian Andes. This road infrastructure, with a public investment of US$450 million, represents a decentralization effort by the Peruvian government.

The port of Chancay could pose a serious skill to the Callao Port Terminal, managed by DP World Callaobusiness subsidiary of Dubai Ports World), APM Terminals and Transportadora Callao. It is the de facto port of Lima and is the country's main port in terms of traffic and storage capacity, with a port movement in 2018 of 2.3 million TEUs and 56 million tons, representing 51% of the national total.

Cosco Shipping Ports terminals worldwide [Cosco Group].

The Minister of Transport and Communications, María Jara Risco, has announced a plan to double the storage capacity of the port of Callao, but there are questions as to whether this will be enough to compete with the new port of Chancay. President Martin Vizcarra sample convinced that both facilities can work in a complementary way, and that the new infrastructure will allow decongesting truck traffic in the area of the capital.

Chinese investment, in any case, has given rise in some media to talk about "checkbook diplomacy", a concept that refers to the use of investments or loans to establish favorable relations with countries that occupy strategic positions in regions of geopolitical interest. Although an infrastructure such as that of Chancay is highly interesting for the beneficiary country, the latter may be obliged to refund the favor in other ways, perhaps by allowing the exploitation of mineral resources. Apart from that, there are the internal Chinese provisions, which oblige its companies with port terminals in the rest of the world to host the wartime navy if necessary.

China's growing influence in the Western Hemisphere worries the US. Its own Vice President, Mike Pence, warned Latin American countries that these investments represent a potential threat, because at the very least they establish an excessive dependence on trade and credit ties with China, also generating a high trade deficit and high debt. Also, according to Pence, they may negatively affect issues such as environmental care or respect for protected areas. 

In more dramatic terms, the Pentagon has spoken out. In February 2019, Admiral Craig Faller, head of Southern Command, warned that in the future "China could use its control of deepwater ports in the Western Hemisphere to increase its global operational position."

The success of several reforms is overshadowed by the impulsiveness and personal interests of a president with a deteriorated image.

▲ Jair Bolsonaro attends to the press in early January at the headquarters of the Ministry of Economics [Isac Nóbrega, PR].

ANALYSIS / Túlio Dias de Assis

One year ago, on January 1, 2019, a former Brazilian army captain, Jair Bolsonaro, climbed the steps of the Palácio do Planalto for the inauguration of his presidential mandate. He was the most controversial leader to assume Brazil's head of state and government since the presidency of the no less flamboyant populist Jânio Quadros in the 1960s. The more catastrophic ones announced the imminent end of the world's fourth largest democracy; the more deluded ones, that Brazil would take off and take its rightful place in the international arena. As was to be expected, neither extreme was right: Brazil continues to maintain the level of democracy of the last 30 years, without any military attempt , as some had feared; nor has Brazil become the world power that many Brazilians believe it is due to its exceptional territorial, population, cultural and political characteristics. As it usually happens, reality has been less simple than expected.

Economics

Among the most attractive aspects of Bolsonaro's candidacy to the public during the election campaign was the promise of economic recovery under the administration of Chicago Boy minister Paulo Guedes. In order to fulfill that purpose, as soon as he took office, Bolsonaro unified the former Ministries of Finance, Planning, development and management, Industry, work and Foreign Trade and Services under the Ministry of Economics, all under the command of the liberal Guedes. A person who became a sort of "superminister" manager of the entire economic diary of the new government.

From the outset, Guedes made it clear that he would do his utmost to lift the barriers of Brazilian trade protectionism, a doctrine adopted in varying Degree by every government for more than half a century. In order to deploy his crusade against statism and protectionism, Guedes has encouraged during this year the bilateral commercial rapprochement to several strategic allies, which, "unlike previous governments, will not be chosen based on ideological criteria", according to Bolsonaro. Already in January there was the advertisement a Novo Brasil at the World Economic Forum in Davos, defined by greater openness, zero tolerance to corruption and strengthening of Latin America as a regional bloc.

Trade

Despite his support for economic openness, Bolsonaro's team has never been overly favorable to trade with Mercosur -his regional multilateral trade bloc-, with Guedes even stating that it was a burden for Brazil, as he considered it an ideological rather than an economic alliance. However, this aversion to Mercosur, and mainly to Argentina, seems to have ended after the signature the Mercosur-EU tradeagreement , given that the potential trade Issue that would be generated with this pact would be enormously beneficial for Brazilian agricultural and livestock producers. An agreement was also signed with the countries of the European Free Trade area (EFTA), comprising Switzerland, Norway, Iceland and Liechtenstein.

Of these two agreements, the most controversial has been the one signed with the European Union, mainly due to the high levels of rejection in some Member States such as France, Ireland or Austria, as it is seen as a possible risk to the Common Agricultural Policy. On the other hand, some other countries were critical alleging Bolsonaro's environmental policy, since the agreement was signed during the summer, which coincided with the time of the fires in the Amazon. As a result, several member states have still not ratified the treaty and the Austrian parliament has voted against it.

However, the fact that multilateral trade relations do not seem to have advanced much, due to the obstacles imposed by Europe, has not prevented Brazil from expanding its commercial activity. Contrary to what one would think, due to the ideological closeness with Donald Trump and his foreign policy, the rapprochement in economic subject has not been with the US, but with the antagonistic Asian giant. In this process, Bolsonaro's trip to Beijing stands out, where he showed himself open to Chinese trade, despite his previous less favorable statements in this regard. During the visit , the proposal for a free trade agreement with China, which has yet to be approved by the Mercosur summit, and several minor agreements, including one on agricultural trade, came up.

This sudden Chinese interest in increasing agricultural imports from Brazil is due to the increase in demand for meat in China, caused mainly by the swine fever epidemic that devastated domestic production. This has led to an immediate rise in the price of beef and pork in Brazil, up to 30% in some cuts in little more than a month, which has distorted the domestic market, since meat, mainly beef, is usually very present in the average Brazilian's usual per diem expenses .

Public accounts

With regard to the country's internal accounts, the approval of the pension reform(Reforma da Previdência), which initially had a markedly liberal character, with the intention of eliminating privileges and disproportionate pensions for high-level public officials, stands out. However, several modifications during its passage through the Chamber of Deputies and the Senate meant that the savings for the public treasury were slightly less than Guedes had envisaged. All in all, it is a great advance considering that the pension system had a deficit of R$195 billion (about US$47 billion) in 2018. This deficit is due to the fact that Brazil had one of the systems with the highest benefits and the fewest demands in the world, as there were not few who retired at 55 years of age receiving 70% of the original salary.

This measure, together with several other adjustments in the public accounts, including the freezing of some ministerial expenditures, reduced the public deficit by US$ 138,218 million in January (6.67% of GDP) to US$ 97,680 million in November (5.91% of GDP), the leave figure since the economic recession began five years ago. Among other relevant data is the decrease in the Central Bank's base interest rate to a historic low of 4.5%, while the unemployment rate went from 12% to 11.2%.

As a result of the above, Brazilian GDP has increased by 1.1%, a timid but promising figure considering the huge recession from which Brazil has just emerged. Growth forecasts for 2020 vary between 2.3% and 3% of GDP, depending on the approval of the long-awaited tax and management assistant reforms.

Security

Another reason that led the controversial reservation captain to the presidency was Brazil's historic crime problem. Just as Bolsonaro came up with a strong name to tackle the economic status , for security he recruited Sergio Moro, a former federal judge known for his indispensable role in Operação Lava Jato, Brazil's largest anti-corruption operation that led to the imprisonment of former President Lula himself. With the goal of fighting corruption, reducing criminality and dynamiting the power of organized crime, Moro was put in charge of a merger of Departments, the new Ministry of Justice and Public Security.

In general, the result has been quite positive, with adecrease in the issue of violent crimes. Thus, there has been a 22% reduction in the case of homicides, which is one of the most worrying indicators in Brazil, since it is the country with the highest absolute issue of homicides in the world per year.

Among the factors that explain this drop in violent crime, the most important is the greater integration between the different state security force institutions (federal, state and municipal). The transfer of gang leaders to prisons with a higher level of isolation, thus preventing their possible communication with other members of organized crime, has also played a role. Another element has been the recent"anti-crime pack", which consists of a series of laws and reforms to the penal code to give more power to state security forces, in addition to establishing harsher penalties for violent crime, organized crime and corruption.

In addition to these advances, there has also been an increase in the number of accidental deaths in police operations. Some cases have echoed in public opinion, such as that of an artist who ended up shot in his car when the police mistook him for a drug trafficker, or those of children killed by stray bullets in shootouts between drug gangs and security forces. This, together with controversial statements by the head of state on the matter, has fueled criticism by most of the civil service examination and several human rights NGOs.

Social policy and infrastructure

In terms of social policies, the past year has been far from the apocalyptic dystopia that was expected (due to Bolsonaro's previous attitude in relation to homosexuals, Afro-Brazilians and women), although it has not been as remarkable as in the previously mentioned sections. There has been no progress in core topic areas, but neither have there been notable changes in terms of social policy with respect to 2018. For example, the emblematic social program Bolsa Família, created during the Lula government and which helped greatly in reducing extreme poverty, has not been cancelled.

Starting with Education, at the end of 2019 Brazil was ranked with one of the lowest scores in the PISA report , a fact that the Minister of Education, Abraham Weintraub, blamed on the "progressive MarxistEducation of previous administrations". As a result of the failure of the regular public system, and even the lack of security of some schools, the government has openly promoted the construction of new civic-military Education centers by state governments. In this subject of center, students receive an Education based on military values while the officers themselves provide protection in these public spaces. It should be noted that the existing centers are among the highest ranked in Brazil in subject of educational quality. However, this is not without controversy, as there are many who consider that this is not an adequate solution, as it may end up educating from a militaristic perspective.

In health subject , the most noteworthy event this year has been the end of the health cooperation program with Cuba, Mais Médicos. This agreement was initiated in 2013, during Dilma Rousseff's mandate, and its goal was to provide greater and more extensive universal medical attendance through the hiring of several doctors 'exported' by the Castro government. The program was criticized because the Cuban doctors only received 25% of the salary provided by the Brazilian government and the remaining 75% was retained by Havana. Bolsonaro broke the agreement, thus causing vacancies in health staff that could be filled in a short time. Cuban professionals were given the opportunity to remain in Brazil under political asylum if they revalidated their degree program in medicine in the Brazilian system. This incident has not brought about a relevant change in the precarious national health system; the only consequence of all this has been the deterioration of relations with Cuba.

Despite not making great progress on the social front, the Bolsonaro administration has made improvements in national logistics infrastructure. Under the command of military officer Tarcisio Gomes de Freitas, the Ministry of Infrastructure has stood out for its ability to conclude works not completed by previous governments. This led to a notable difference in the issue and quality of operational roads, railroads and airports compared to the previous year. Among the sources of financing for new works is the reopening of a common fund established in 2017 between Brazilian and Chinese financial entities, worth US$100 billion.

Bolsonaro with Indian Prime Minister Narendra Modi during an official visit to New Delhi in late January [Alan Santos, PR].

Environment

One of the areas most feared to be harmed by Jair Bolsonaro's administration was environmental policy. Such concern was heightened by the controversial fires in the Amazon during July and August. To begin with, the Ministry of the Environment, like all the others, was affected by Paulo Guedes' austerity policies, in order to balance the public accounts, although according to Minister Ricardo Salles himself, it was the one that suffered the least from the budget cut. As a result, at the beginning of the drought period in the Amazon, forest protection was compromised.

Seeing the 278% increase in deforestation during the month of July, Bolsonaro reacted impulsively and fired the director of the National Institute of Space Research (INPE), accusing him of favoring civil service examination and conspiring against him. The status caused the departure of the Amazon Protection Fund from Germany and Norway, the two largest contributors, which was met with criticism from Bolsonaro, who also accused the NGOs of being the cause of the fires. Finally, under international pressure, Bolsonaro finally reacted and decided to send the army to fight the flames, a goal he achieved in just under a month, reaching the leave number on record in October.

In the end, the annual total ended up exceeding the previous year's figure by 30%, but still within the average of the last two decades. However, the damage to the national image was already done. Bolsonaro, thanks to his rivalry with the media, his vehement eagerness to defend "national sovereignty" and his lack of restraint when speaking, had managed to be considered the culprit of a distorted catastrophe.

Additionally, at the end of the year, one more controversy hit the Bolsonaro administration: the mysterious oil spill on the northeast coast of Brazil. Thousands of kilometers of beaches were affected and still to this day there is no official culprit for the crime. There were several hypotheses on the matter; the most accepted one, which was also supported by the government, was that the spill came from an illegal shipment of Venezuelan oil trying to circumvent the trade blockade imposed on Maduro's regime. According to analyses carried out by the Universidade da Bahia, the structure of the oil was indeed very similar to that of crude oil from Venezuelan fields.

Foreign policy

In foreign policy Bolsonaro may distinguish himself rhetorically from his predecessors, but not in terms of his actions. Although in that area he would like to apply his ideology, he himself has accepted that it is not possible to do so. In the face of the strength and interests of state institutions, such as the diplomatic tradition of Itamaraty (Ministry of Foreign Affairs), Brazilian foreign policy has remained as pragmatic and neutral as in all previous governments of democracy, thus avoiding the closing of doors for ideological reasons.

A good example of Brazilian pragmatism is the economic rapprochement with China, despite Bolsonaro's rejection of communist ideology. Although this does not mean that he has distanced himself from his quasi-natural ally in terms of ideology, Donald Trump. However, the relationship with the US has been of a different nature, as there has been greater proximity in international cooperation and security. The US pushed for the designation of Brazil as a strategic partner of NATO, reached an agreement for the use of the Alcântara space base, very close to the Equator, and supports Brazil's entrance the OECD.

However, in the economic sphere, there does not seem to be such closeness, and there have even been certain frictions. One of them was Trump's threat to impose tariffs on steel and aluminum from Brazil and Argentina, which he finally withdrew, although the damage to trade relations and the São Paulo and Buenos Aires stock exchanges was already done. Some analysts even point out that the lack of US reciprocity in economic subject , as well as the rejection by some EU members of the agreement with Mercosur, was what pushed Bolsonaro to seek a compensatory relationship with the BRICS, whose 2019 summit took place in Brasilia.

Another peculiar point of Bolsonaro's foreign policy has been his position on the Israeli-Palestinian conflict, which once again sample the inconsistency between rhetoric and action. During the election campaign Bolsonaro promised on several occasions the transfer of the Brazilian embassy from Tel-Aviv to Jerusalem, something that so far has not happened and there has only been the transfer of an economic office. Bolsonaro probably feared trade reprisals from Arab countries, to whom Brazil exports products, mostly meat products, worth almost 12 billion dollars. Prudence in this matter even earned him the signature several agreements with Persian Gulf countries.

Despite the above, there has been one aspect of foreign policy in which Bolsonaro did manage to impose his ideology against the "historical pragmatism" of the Itamaraty, and this is the Latin American sphere. Brazil ceased to be the giant that in theory remains neutral to support, timidly, the so-called Socialism of the 21st Century during the governments of Lula and Dilma, and now coordinate with the governments of the other political side.

Most notable is his enmity with Nicolás Maduro, as well as with former President Evo Morales, whose request to pass through Brazilian territory was openly denied by Bolsonaro. There has also been a distancing with respect to the returned Peronism in Argentina, with the absence of Bolsonaro and of any high Brazilian representative in the inauguration ceremony of Kirchner's Alberto Fernandez. In the same context are the approaches to Chile, Uruguay, Paraguay and Colombia, as well as to the new provisional government of Bolivia, with which Bolsonaro sees more similarities. With them he has promoted the creation of PROSUR as opposed to the former UNASUR controlled by the Bolivarian left. Even and all, despite having adopted a more ideological policy in the region, Brazil continues to maintain diplomatic cordiality since, although its leader takes liberal conservatism to extremes in his rhetoric, his policies in the region hardly differ from the rest of the right-wing governments.

Bolsonaro

In general, as has been exposed, in its first year the Bolsonaro administration has obtained positive results, highlighting mainly its progress in the areas of security and Economics. However, while the work of various ministers improves the perception of the administration, Bolsonaro himself does not seem to be making a particularly positive contribution. Throughout the year, he has generated controversies over unimportant issues, which have accentuated his previous enmity with most of the press.

Because of this, the president's public image has gradually deteriorated. At the end of 2019, his popularity was 30%, compared to the 57.5% with which he began the year. That contrasts with the percentage of approval that members of his government have, especially Sergio Moro, who has managed to remain immovably above 50%. In addition, his son Flavio, who is a senator, has come under investigation for a possible corruption case, in a process that the president has sought to prevent. Bolsonaro also caused a scandal in the middle of the year when he tried to appoint his son Eduardo as ambassador to Washington, being accused of nepotism. To the tensions in his own party, which led to a rupture, must be added the poor rapport between Bolsonaro and the presidents of both chambers of the fractured National congress , both investigated in conveniently stalled anti-corruption operations.

Impeachment?

All this chaos caused by the president gives the impression of a Bolsonaro who goes against the current of his own government. The apparent success of the reforms already carried out ends up being tainted by the impulsiveness and personal interests of the man who once defended the impersonality of the State, which ends up causing the deterioration of his political image. In addition, there is the recent release of former president Lula, which entails the risk of the unification of the civil service examination, depending on how moderate the speech he adopts. This being the case, it is possible that the headless but efficient Bolsonaro government will not find it easy to stay in power until the end of its term. It should be remembered that the hand of the Brazilian congress does not usually tremble when it comes to impeachments; see that in little more than three decades there have already been two.

The island faces the most serious economic crisis in the last twenty years: Venezuela's collapse and Trump's pressure highlight Havana's immobility

The end of the USSR, a major subsidizer of the Castro regime, did not lead Havana to the economic and political opening that took place in most of the former communist bloc. After a time of severe hardship in the 1990s, known as the "special peacetime period", Cuba got another savior in Venezuela, thus avoiding the necessary reforms. Today, the Venezuelan collapse and the pressure being exerted by Washington once again highlight Havana's unwillingness to change, as it faces another "special period", less intense, but equally painful for the Cuban people.

▲ Street in the historic center of Havana [Pixabay].

article / Patricia Urdánoz

The Cuban Economics could have Closed 2019 with a growth of barely 0.5% of GDP and could repeat that same poor performance in 2020, agreement to estimates by ECLAC, the UN Economic Commission for Latin America and the Caribbean. These are figures that place the island on the verge of recession, given that there could be a negative quarter. Although the Cuban government places its economic goal for this year at 1%, its bet of 1.5% for 2019 may have been off by up to one percentage point (international organizations, in any case, cannot audit Cuba's accounts); moreover, the elements contributing to the economic performance have worsened.

The growing economic difficulties have generated fears among Cubans about a return to the "special period", as it is known in the 1990's when the dissolution of the USSR left the island without the massive financial aid provided by Moscow. That time of special hardship was overcome with the financial aid that started to arrive from Hugo Chavez's Venezuela in 2002. The Venezuelan collapse was what encouraged Raul Castro to seek salvation through rapprochement with the Obama Administration, but the new restrictive measures of the Trump Administration have left Havana without prospects.

Cubans have begun to suffer shortages of basic products such as medicines and food, and long and endless queues are once again appearing in the Cuban capital. Economics has been stagnant since 2014: although the following year there was a clear upturn, in 2016 there was a contraction, which the Government set at 0.9% of GDP, which meant having fallen into recession for the first time since the "special period", twenty years ago.

Although it is unlikely that Cuba will reach the dramatic figures of much of the 1990s, when the island's Economics contracted by approximately 35%, some estimates, reported by the Wall Street Journal, consider that if Venezuela were to completely cancel its financial aid there could be a contraction of 8% or 10%.

Before the "special period" the island was 82% dependent on the Soviet Union. Venezuela's dependence is comparatively lower and is also decreasing due to the serious crisis in that country. Venezuelan financial aid , basically by sending oil in exchange for the attendance of doctors, sports coaches and other staff, for which Caracas also pays, accounted for 22% of Cuba's GDP in 2013; in 2017 it had fallen to 8.5%.

The economic outlook, in any case, is not good and a worsening in several areas is to be expected for 2020, which will at least prolong the stagnation.

Venezuelan oil, now in Russian hands

Although Venezuelan financial aid has been decreasing, Caracas' contributions continue to be important, so any further erosion of that aid would have an effect on Cuban Economics . The 100,000 barrels of oil per day that Venezuela has been sending to Cuba for many years has recently been reduced to about 60,000 barrels per day. A further reduction is not to be expected, but the control of PDVSA's production that Russia is acquiring leaves the regime of Nicolás Maduro less room for political control over oil.

Fewer physicians abroad

The uncontrolled inflation suffered by Venezuela could force a reduction in the payment that this country provides for the services rendered by Cuban staff on Venezuelan soil. Carmelo Mesa-Lago, an economist specialized in Cuba, points out that Venezuela, which acquires 75% of that Cuban professional service abroad (an important means of access to hard currency), has already reduced its purchases by 23% between 2014 and 2017 and could be forced to make further cuts. Havana, on the other hand, stopped making cash in 2019 with the doctors it had stationed in Brazil and the same will happen in 2020 with those in Bolivia, after political changes in those countries forced their return to the island.

Below the goal of 5 million tourists

The expectations opened in the subject tourism with the increase in travel from the U.S. due to the facilities provided by President Obama have been frustrated by the restrictions again imposed by his successor. In 2018 there was a decrease in the issue of tourists, which was 4.7 million, and this figure fell by 10% in 2019, to 4.3 million. Although the government says it expects an increase in 2020, it has stopped setting a goal of reaching 5 million tourists. The limitation already imposed by Trump in 2018 on US-based cruise travel is followed by the recently announced limitation on direct flights, which could affect the income left by tourism (those who arrive by plane tend to spend more during their stay).

Moderate exports

Export revenues could improve, but neither production nor price looks set to experience a significant increase. Nickel production has been rather stagnant and sugar production is recovering from its all-time low recorded in 2017-2018.

Remittances will continue to flow

The restrictive measures imposed by the Trump Administration on remittances coming to Cuba from the U.S., which are the majority, do not seem to affect their amount, since the established limit remains above the amount of most of the shipments. As indicated in a study by The Havana Consulting Group, the current average remittance amount is between 180 and 220 dollars per transaction, and since 95% of Cubans who send remittances to their relatives on the island do so once a month, the limit of 1,000 dollars per quarter imposed by Washington, which came into force last October, is not reached. In addition, the study specifies that 45% of remittances to Cuba arrive through informal channels. In 2018, Cuba received $3.691 billion, a figure that practically doubles if non-cash remittances are taken into account.

Insufficient foreign investment

Remittances should play an important role in boosting the national Economics , and in fact, since the economic opening of 2010, they have functioned as a source of income similar to foreign investment, since they were behind the start-up of many "self-employed" businesses. Those self-employed businesses reached 535,000 workers in 2016, according to official statistics, but the stagnation in the growth of tourism is putting that private activity in difficulties. The Havana Consulting Group study concludes that "unlike most Latin American countries, the Cuban government does not take advantage of the potential of remittances as a way to attract investment capital to the country." Foreign direct investment, in any case, has been increasing, but the slowness in making attractive the special zone of the port of Mariel and the added difficulties from the US with the implementation in 2019 of the fourth degree scroll of the Helms-Burton Act, which encourages the presentation of lawsuits for the assets expropriated during the Cuban revolution, dampens the investment attractiveness of the island.

DECENTRALIZATION, BUT TIMID OPENING

The problem of inefficiency in the Cuban Economics is largely due to its centralized model , which creates shortages for consumers and great uncertainty for businesses. Along with other burdens that the country has carried since its beginnings, such as corruption, illegalities, low savings, indebtedness and insufficient export revenues. Cuba's foreign debt between 1958 and 2017 multiplied by 190. And there is a difficult situation for the emergence of the private sector.

The island needs new structural economic reforms by the government; it would also be interesting to follow the economic strategies of countries such as Vietnam and China, which have known how to open up to the international market starting from a communist government. For its part, Washington, for its own geopolitical interests, should take care that its pressure measures do not drive the island into the arms of China and Russia.

Raúl Castro's successor as president of the country, Miguel Díaz-Canel, and the prime minister appointed by him, Manuel Marrero, have announced for this year the beginning of a process of economic decentralization that will give greater autonomy to state-owned enterprises. It remains to be seen whether progress will actually be made along these lines and whether this will increase the efficiency of the Cuban Economics , since the reforms promised by Castro have been a very timid opening, not particularly transforming.

Gold mining and oil transport pollute Amazonian rivers

Not only are fires negatively affecting the Amazon, which is undergoing an accelerated reduction in forest mass, but increased activity, driven by deforestation itself - which in turn encourages illegal mining and more fuel transport - increases pollution of the Amazon River and other waterways in the countries that are part of the region. The use of mercury in gold mining is an additional serious problem for the communities living in the basin.

▲ Sunset on the Amazon River, Brazil [Pixabay].

article / Ramón Barba

The increase in illegal mining in the Amazon region, in countries such as Colombia and Peru, and especially in Venezuela, has increased river pollution throughout the basin. Pollution is also aggravated by the transport of oil, which generates crude oil leaks, and by the discharge of wastewater linked to increased human activity, which in turn is related to increasing deforestation.

Illegal mining has spread especially in the last two decades, linked to the increase in the price of minerals. Despite the general fall in the price of raw materials since 2014, the price has remained high in the case of gold, because as a refuge value it resists the global economic slowdown. Obtaining gold requires the manipulation of mercury to extract it and separate it from the rocks or stones in which it is found. It is estimated that illegal mining activity discharges an average of 24 kilos of mercury per square kilometer. As the Amazonian Cooperation Treaty Organization (ACTO) points out in its report Regional Transboundary Diagnostic Analysis of the Amazon Basin of 2018, it is estimated that the Brazilian Amazon alone received 2,300 tons of mercury until 1994 and then has registered volumes around 150 tons per year.

ACTO indicates that mining is located especially in the Guiana Shield, in the Andean zones of Peru and Bolivia, and in the Colombian piedmont. Information gathered by this organization estimates that between 100,000 and 200,000 people are involved in this activity in Colombia and Peru, a figure that doubles in the case of Brazil.

For its part, the Amazonian network of Geo-referenced Socio-environmental Information (RAISG), in its study The Plundered Amazon, at the end of 2018, notes that the area in which illegal mining occurs "is increasing", especially in Venezuela, where "the reports change drastically from year to year". The RAISG computes 2,312 points in the Amazon region where there is illegal mining activity, of which 1,899 correspond to Venezuela.

According to the RAISG report , mining exploitation gives a double function to rivers, as they are used for the introduction of machinery and for the disposal of minerals. This has serious environmental effects (soil erosion, contamination of water and hydrological resources, extinction of aquatic flora and fauna, atmospheric impacts...), as well as serious consequences for the health of indigenous peoples, as mercury contamination of rivers affects fish and other living beings moving in the river environment. Given that the main per diem expenses of indigenous peoples is fish, the ingestion of high levels of mercury ends up damaging the health of the populations (cases of loss of vision, heart disease, damage to the central nervous, cognitive or motor system, among others).

Another aspect of mining activity is that it tends to lead to land appropriation and incursion into protected natural areas in the Amazon, increasing deforestation and reducing biodiversity. The Tapajós and Xingú areas in Brazil, together with the Guiana Shield, are the areas most affected by deforestation, according to RAISG. Based on previous programs of study , this organization indicates that deforestation due to gold mining has accelerated in the last twenty years, from 377 km2 deforestation between 2001-2007, to 1,303 km2 deforestation between 2007-2013. In Peru, it is worth noting the case of the Madre de Dios department , where 1,320 hectares were deforested between 2017 and 2018.

Other causes of contamination

In addition to illegal mining, other processes also pollute rivers, such as hydrocarbon extraction activities, wastewater discharge and river transport, as warned by ACTO, an organization that groups the eight countries with territory in the Amazon region: Brazil, Colombia, Guyana, Suriname, Venezuela, Peru, Bolivia and Ecuador.

Hydrocarbon contamination. The status affects the five countries to the west of the Basin (Colombia, Ecuador, Peru, Guyana and Brazil), with Bolivia being a potential candidate as it has large untapped gas reserves in the area. Pollution in this case comes from the transport of oil by river from the extraction points to the refineries. This has important environmental and socioeconomic consequences, such as soil degradation and air pollution, which also implies loss of flora and fauna, as well as hydrobiological resources, affecting biodiversity and species migration. In the socioeconomic field, these problems translate into increased operational costs, the displacement of indigenous people, an increase in diseases and the emergence of conflicts.

Pollution from domestic, commercial and industrial wastewater. Despite the large amount of water available in the countries of the Amazon basin, the level of sanitation does not exceed 60%. As a result, rivers become vectors of disease in many rural communities, where sanitation is poorer. Non-updated data indicate urban and domestic waste of 1.7 million tons per liter and 600 liters per second in 2007. At the same time, it is important to take into account the damage caused by agroindustrial activities in river courses, since the large issue of insects and microorganisms implies an abundant use of pesticides, herbicides and fungicides. Among the environmental and social problems caused by this activity are the emission of greenhouse gases, the deterioration of aquatic ecosystems, eutrophication and pollution by agrochemicals, and the loss of wages and increased water treatment costs.

Pollution from river transport. The Amazon region has about 24,000 km of navigable rivers, which are the main means of communication. Some 50 million tons of cargo were transported on the Amazon at the beginning of the decade just ended. In addition to fuel leaks, the activity produces a dragging of sludge that is not dredged periodically, as well as contamination of riverbanks and beaches, which is detrimental to Economics and tourism.

Impact on indigenous communities   

For many indigenous peoples, as is the case in Colombia, gold is a sacred mineral because it represents the sun on earth. They consider that the extraction of this mineral implies the loss of life in the territory and to extract it the shamans of the area must "ask permission" through a series of ceremonies; to do so without the granted permission implies negative consequences, hence the indigenous populations associate the improper extraction of gold with illness and death. An example of this is the area of the Aaporis River, also considered sacred, where Yanomami leader Davi Kopenawa speaks of the xawara wakémi (the smoke epidemic), derived from the burning of gold and which is, according to him, the cause of death of some inhabitants of the area.

However, members of indigenous communities also engage in artisanal mining, either because they reject the tradition in entrance face of the economic benefits of illegal extraction, or because they are forced into this occupation by the lack of opportunities. The latter is the case in the Peruvian communal reservation of Amarakaeri, which has been greatly affected by extractive activity, where its inhabitants have been forced to practice artisanal mining under pressure from their subsistence needs and from external mining interests that end up exploiting them.

Uncontrolled mining, on the other hand, has a negative impact on the environment in which indigenous people live. In the Ecuadorian province of Zamora Chinchipie, for example, a mega open-pit mining project was carried out, the impact of which has involved deforestation in the area of 1,307 hectares between 2009 and 2017.

It should be noted that mining not only implies an attack against certain indigenous cultural aspects, but also a serious attack against their human rights in that, despite the fact that they are peoples living in voluntary isolation, mining companies interfere in these reserves and force displacements and uprooting. This status is especially critical in Bolivia, Ecuador and Peru, countries in which there is a "gray zone" between legality and illegality in artisanal mining, increasing the Degree involvement in indigenous areas. At the same time, it is worth mentioning the repressive activity of the states in the destruction of dredges and rafts, which leads to a violent response on the part of those affected, as occurred in the Humaita revolt in Brazil.

Indigenous life has also been affected by the presence in these territories of guerrilla or paramilitary groups, as well as organized crime groups. In Colombia, armed groups have taken advantage of mining to finance their activities, which they develop in areas with high levels of poverty and difficult access for the Government. Between 2017 and 2018 there was a 6% increase in this activity, in places where coca can also be grown, whose production has also increased in recent years. The 2016 OECDreport Due Diligence in the Colombian Gold Supply Chain indicates that the FARC, ELN and criminal gangs began their mining activity in the 1980s and increased it in the 1990s as a result of the rising price of gold and the increased difficulty of obtaining stable drug revenues. In 2012, the FARC and ELN had a presence in 40% of Colombia's 489 mining municipalities. Recently, ELN presence has been witnessed in illegal mining in Venezuela, especially in the state of Bolivar, to which FARC dissidents sheltered in Venezuelan territory could be added.