Latin America’s Annus Mediocris

El Financiero

Jorge G. Castañeda

The good, the bad, and “the Donald.” For Latin America, that was 2017 in a nutshell.

The highlight of the year was, without question, the historic peace forged in Colombia. After a half-century-long insurgency fueled by drug cartels, Cubans, and money launderers, the Revolutionary Armed Forces of Colombia (FARC) laid down their weapons and entered the political mainstream. Although some Colombians felt that President Juan Manuel Santos gave away too much to reach the accord, the end of the Western Hemisphere’s longest-running armed conflict should be lauded. Santos may not enjoy the domestic popularity his achievements merit, but the peace he championed – which earned him the Nobel Peace Prize in 2016 – is likely to survive.

Another highlight of the last 12 months was Latin America’s continued success in tackling corruption, led by Brazil’s Lava Jato (Car Wash) investigation. That probe, which began in 2014, netted a number of high-profile politicians and business leaders in 2017, including former Presidents Dilma Rousseff and Luiz Inácio Lula da Silva in Brazil; three former presidents of Peru; and a former head of Mexico’s state oil company, Pemex. Santos also had to testify – and deny that he was aware of contributions to his campaigns from the Brazilian construction conglomerate Odebrecht.

Corruption charges were also lodged during the year against Venezuelan President Nicolás Maduro, Guatemalan President Jimmy Morales, several former Mexican state governors, and former Argentine President Cristina Fernández de Kirchner, along with a handful of those who served in her cabinet.

The sheer volume of corruption cases is staggering, and some worry that the region’s political stability could suffer as a result. In Brazil, for example, many fear the judiciary’s tenacity could lead to a military dictatorship or the equivalent, especially if an extreme right-wing former soldier is elected president next year.

These are not groundless concerns, given the region’s history of authoritarianism. But with endemic corruption eroding Latin America’s economic growth and undermining the rule of law, the investigations underway are a welcome change from the status quo.

Latin America’s low point in 2017 was, like its highs, easy to discern: Venezuela’s political crisis. Protests that erupted in the middle of the year and lasted through September resulted in the deaths of more than 120 anti-government demonstrators. Many were killed at the hands of barely disguised pro-government Chavistas, known as colectivos.

In July, Maduro replaced the elected National Assembly with a handpicked constituent assembly to rewrite the constitution and entrench his regime. The crisis, fueled by the government’s massive foreign-debt burden, effectively shut down government services, and basic necessities like food, medicines, and toilet paper remain scarce. Some two million Venezuelans have fled the country.

Most Latin American governments have refused to recognize Maduro’s de factocoup d’état – an encouraging example of democratic solidarity in the region. But Maduro has yet to engage in good-faith negotiations, and Latin America’s worst crisis seems no closer to resolution.

Finally, there was US President Donald Trump’s effect on Latin America in 2017. While the impact of Trump’s presidency has been felt around the world, no region has suffered as profoundly as those on the United States’ southern doorstep.

Consider the crisis in Venezuela, which was moving toward resolution before Trump suggested that a military response might be needed. As Venezuela’s defense minister put it, Trump’s reckless comments were “an act of craziness” – one that forced several Latin American leaders to distance themselves from the US. By refusing to rule out a military option, Trump effectively torpedoed any chance of a speedy resolution, allowing Maduro to portray the incident as proof that “el imperio” wanted to overthrow him.

Trump’s policies and statements on immigration were equally chilling, especially for Mexico, Cuba, and the countries of Central America, which account for a majority of immigrants in the US. From vowing to end a program shielding young undocumented immigrants from deportation, to his absurd pledge to build a “wall” on the border with Mexico, Trump’s behavior has been deeply unsettling.

Beyond immigration, Cuba and Mexico were in Trump’s crosshairs, for different reasons.

On Cuba, Trump rolled back much of President Barack Obama’s efforts to normalize bilateral relations. The new US policies, implemented mid-year, were not draconian, but they probably will suffice to dissuade new American investment. Trump’s decision to reduce the number of staff at the US Embassy in Havana, officially due to a mysterious illness affecting them, has only heightened investor concerns. And, as the State Department continues to discourage Americans from visiting Cuba by issuing ominous travel advisories, the number of US tourists is likely to decline in 2018.

As for Mexico, Trump’s insistence on renegotiating the North American Free Trade Agreement battered the peso, discouraged foreign investment, and put the country’s highly unpopular president, Enrique Peña Nieto, in a predicament. Following negotiations in Mexico, Canada, and the US in 2017, it became increasingly evident that Trump’s strident campaign rhetoric was being translated into policy, most of which is unacceptable to America’s trading partners.

The year that just ended was an eventful one for Latin America. A war ended, dense webs of high-level corruption began to unravel, and the risk of authoritarian backsliding in some countries has underscored the region’s broader commitment to democracy.

But, on balance, Trump’s arrival on the world stage made 2017 a year to forget for Latin America. Millions of Latinos in the US have been targeted for deportation, and countless others will suffer in Mexico, Cuba, and elsewhere if the US proceeds with the administration’s proposed trade and immigration policies. And that, unfortunately, is the most likely scenario for 2018 and beyond.

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