April 27, 2021

Latam

LATAM PULSE

BY Mario Marconini, Nicholas Watson

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( 5 mins)

This week, in Chile, President Sebastian Pinera is mired in one of the most difficult periods of his troubled presidency as the issue of pension withdrawals sparks yet another political crisis. In Brazil, the government faces an enquiry into its handling of the pandemic. A general strike against tax reforms in Colombia could be limited by the worsening health situation. Mexico’s opposition parties are fighting a rear-guard action to prevent what they see as President Andres Manuel Lopez Obrador (AMLO)’s interference in the judiciary. In Argentina, more coronavirus restrictions will be announced in the second half of the week. Finally, community and social license challenges for extractive companies in Peru will likely continue regardless of who wins the June presidential election.

Chile

The government will use the coming days to win support for the pension withdrawal initiative that it reluctantly submitted to the lower house last night, 26 April. President Sebastian Pinera was forced to come up with the bill as an alternative to the opposition-tabled pension withdrawal initiative that the lower house and Senate have already passed – with support from members of the governing Chile Vamos (CV) coalition. Pinera has filed a challenge against the opposition initiative, which the Constitutional Court (TC) will consider from today. CV members and presidential candidates from the coalition argue that the government’s opposition to further pension withdrawals – which are very popular – could be highly damaging electorally; mayoral, municipal council, gubernatorial, and constituent assembly elections are scheduled for 15-16 May.

Brazil

The long-awaited Senate parliamentary inquiry committee (CPI) on Covid-19 starts today, 27 April. The work will be led by two independent senators: Omar Aziz from the Social Democrats (PSD) as Chairman and Renan Calheiros from the Brazilian Democratic Movement Party (MDB) as rapporteur. Seven of the CPI’s 11 members, including Aziz and Calheiros, have been very critical of the Jair Bolsonaro government’s handling of the pandemic. The government’s focus will be to shield the president while supporting frontman Army General Eduardo Pazzuelo, former health minister, who will likely have great difficulty defending his disastrous ten-month tenure. House Speaker Arthur Lira should intensify his push for an administrative reform but the CPI should override that and other priorities for at least a few weeks.

Colombia

A general strike has been called for tomorrow, 28 April, in response to the government’s controversial tax reform initiative unveiled earlier this month. Teaching unions are also demanding priority Covid-19 vaccinations. While the leftist presidential aspirant Gustavo Petro would probably like to re-ignite the November 2019 protest movement, the worsening health crisis could reduce turnout and limit the strike’s impact. The tax reform in its original version is anyway virtually dead given widespread opposition in Congress, where parties including the likes of Radical Change (CR), whose votes the government needs, have rejected the bill. The question now is whether the government is forced to cook up an entirely new reform and what, if anything, can be rescued from the original USD 6.4bn package.

Mexico

Opposition parties are preparing to file a challenge with the Supreme Court (SCJN) after the governing National Regeneration Movement (Morena) and its allies in the lower house on 23 April approved the extension of the SCJN president Arturo Zaldivar’s term by two years to 2024 – i.e., the rest of Andres Manuel Lopez Obrador (AMLO)’s presidency. This is a violation of the constitution and is likely designed to unblock legal suits against AMLO’s energy reform rollback. It could also set a dangerous precedent since the term extension could now be applied to other positions, including the presidency. AMLO probably also wants greater control of the CJF judicial oversight and supervisory body, whose term has also been extended. Tensions over the issue will remain high as the National Action Party (PAN) looks to use the issue to mobilize opposition voters ahead of the June mid-terms and state elections.

Argentina

The government is likely to announce new coronavirus restrictions towards the end of this week as the country’s “second wave” continues. Yesterday, 26 April, the number of people in intensive care exceeded 5,000 for the first time since the beginning of the pandemic. There is also increasing concern over possible oxygen supply shortages. Buenos Aires provincial authorities are pushing for significantly more drastic restrictions, though President Alberto Fernandez may hold off on ordering a total lockdown along the lines of March 2020, in part because health authorities are advising that measures need to be phased, and that a full quarantine should be “saved” for the approaching winter season.

Peru

An analysis of April’s first-round voting patterns in mining regions shows that the hard-left presidential candidate Pedro Castillo won in 67 out of 76 areas where there are active mining-related community conflicts. The state ombudsman currently classifies as “active” over 80 social/environmental conflicts related to either mining or hydrocarbons. If Castillo wins the 6 June run-off vote, expectations that he can resolve these conflicts would be high, though it is far from clear that Castillo has the capacity to do so; the candidate appeared to row back from his more radical proposals to nationalize mining projects, though he continues to talk about a change to profit-sharing arrangements. If Castillo’s rival Keiko Fujimori were to win, her credibility with communities would be low, which would also present challenges in the resolution of these issues

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( 5 mins) This week, Chile marks two years since the outbreak of protests just as the constituent assembly born out of that unrest starts to debate the content of a new constitution. In Peru, a new stage

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( 4 mins) This week, Chile‘s President Sebastian Pinera faces a bumpy ride as he seeks to defend himself from allegations arising from the “Pandora Papers” leak; at the same time, another presidential debate takes place later today.

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( 3 mins) Prime Minister Guido Bellido’s threat to nationalize the consortium that operates the Camisea natural gas field unless it agrees to pay higher taxes is unsettling – though not for what might seem the most obvious

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