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Obama and Uribe Talk Trade and Term Limits AS/COA Online 06/30/09
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| Presidents Álvaro Uribe and Barack Obama met at the White House on June 29. (AP Photos) |
Colombian President Álvaro Uribe met with his U.S. counterpart Barack Obama June 29 to discuss the future of the stalled free-trade agreement and Uribe’s political future. At the meeting, Obama praised Uribe’s achievements on improving security and his fight against drug cartels. The U.S. leader even joked about how difficult it would be to match Uribe’s 70 percent approval ratings after two terms in office. Still, Obama advised Uribe against running for a third consecutive presidential term and used U.S. President George Washington’s experience as an example of statesmanship: “[A]t a time when he could have stayed president for life, he made a decision that after service, he was able to step aside and return to civilian life. And that set a precedent then for the future.”
Obama’s counsel for Uribe to avoid a third term through constitutional change coincided with world attention on Honduras. A day earlier, a coup occurred in the Central American country after Honduran President Manuel Zelaya, planned to go forward with a referendum deemed illegal by the country’s main institutions. Obama expressed his support for democratically elected Zelaya and described the overthrow as “not legal.” Colombia also rejected the coup.
In Colombia, a referendum to pave the way for Uribe’s reelection still faces hurdles in Congress and already shows signs of fatigue among supporters. Cambio magazine explains that the chances to approve the legislation are slim, even with Uribe spending his political capital to move it forward. But Semana magazine says, “Uribe has radicalized his position about the referendum,” and that he sees it “as a matter of pride.”
The pending bilateral free-trade pact was also a central conversation point for the two leaders during their White House meeting. Obama offered his support for the deal but explained that concerns linger in U.S. Congress over human rights violations against Colombian labor leaders. At the summit, Uribe said that “we are very receptive to receive any advice, any suggestion that help us see how we can achieve our goals of zero human rights violations in Colombia.” After an event co-hosted by the Council of the Americas at the Wilson Center on the morning of June 30, Uribe said he had found Obama “more disposed and interested” in the trade deal. COA’s Eric Farnsworth blogs for Americas Quarterly, the two leaders’ meeting shows “that the bilateral agenda with Colombia goes well beyond passage of one agreement, as important as that is, and that the U.S.-Colombia relationship is strong and enduring.”
Learn more:
- COA Vice President Eric Farnsworth’s AQ blog post about Obama’s meetings with Uribe and Chilean President Michelle Bachelet.
- AS/COA coverage of Uribe’s dilemma about his second consecutive reelection.
- Americas Quarterly’s web exclusive about whether Uribe will seek reelection.
- Transcript of Obama-Uribe press conference following their June 29 meeting.
- Colombia’s constitution.
- Text of the pending U.S.-Colombia Trade Promotion Agreement.
- Semana analysis of U.S.-Colombia relations.
To Run or Not to Run: Uribe’s Question AS/COA Online 05/21/09
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| President Uribe still ponders a possible third term. (AP Photo) |
Colombia’s Defense Minister Juan Manuel Santos steps down from his post on May 23 to become a presidential candidate for the 2010 elections. But there’s a catch: He’ll only declare his candidacy if President Álvaro Uribe chooses not to run for his second reelection. In an interview with Caracol Radio, Santos said that “he had the hunch that Uribe may not run” but that the president may not make his decision until October. Moreover, Colombia’s Senate approved legislation this week allowing a public referendum on whether President Álvaro Uribe should be allowed to run for his second consecutive reelection. The president may be delaying his decision in order to make the opposition seem weak and divided, thereby giving his party a boost on election day.
When Semana picked Santos as Colombia’s 2008 person of the year in December, the minister was already acting like a candidate on the road, offering gifts in various communities and inviting journalists to follow. In an interview with Cambio magazine this week, Santos reiterated his loyalty to Uribe and to upholding his democratic security policies if elected. Still, Santos finds himself competing for second place in popularity standings with former Medellín Mayor Sergio Fajardo. Other presidential hopefuls include former Agriculture Minister Andrés Felipe Arias, Ambassador Noemí Sanín, and the leader of the Cambio Radical political party Senator Germán Vargas Lleras.
During a September 2009 AS/COA luncheon, Uribe stated that “Colombia needs to reelect policies, not people.” Yet, eight months later, he remains ambiguous about his intentions. His approval ratings run above 70 percent and polls indicate he would likely win reelection. The Senate bill approving a reelection referendum earlier this week was passed by a 62-5 vote, though more than two dozen members of the opposition refused to participate. The bill needs to be reconciled with one from the house, then evaluated by the Constitutional Court. After clearing those hurdles, the referendum may be scheduled for some point in the fall.
Uribe’s popularity appears to stem from the fact that his administration oversaw the significant weakening of the Armed Revolutionary Forces of Colombia (FARC) and a period of economic renewal. In contrast, his high ratings have not been significantly damaged by recent wiretapping scandals involving Casa de Nariño and the Supreme Court, a cooling economy, or the extrajudicial killings of civilians by members of Colombia’s armed forces. “It may just be that they’re drinking Uribe’s Kool-aid,” comments the Latin American Thought blog in an analysis of recent poll data. The blog also suggests that Colombians place higher value on their security and economic issues than on democratic freedoms.
The idea of a third term for Uribe is a source of controversy for many. The Christian Science Monitor raises the question of whether Uribe is “following [Venezuelan President Hugo] Chávez’s footsteps?” In response, “Uribe has said he is only interested in seeing continuity for his security policies, but he has also hinted that he is the best one to do it,” the Monitor adds. Miami Herald’s columnist Andrés Oppenheimer says that Uribe should not run because “he would lose all moral authority to criticize Chávez and other elected autocrats who see themselves as ‘indispensable men’ and who end up destroying their countries’ institutions. There is no such thing as a good dictator, and Uribe would not be an exception to the rule.” The Economist reflects on the good and bad of Uribe’s two presidential terms but says: “If he doesn’t quit while he is still ahead, history may judge that Mr. Uribe began to undo his own achievement.”
Read the article as originally posted at the AS/COA website.
Correa Wins Reelection Bid AS/COA Online 04/23/09
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| President Rafael Correa will likely win Sunday’s election. (AP Photo) |
Updated April 27 – Ecuadorians headed to the polls on Sunday for presidential and legislative elections. President Rafael Correa easily won the bid for a second term. The win came as little suprise, as surveys placed him ahead with the 50 percent of the intended votes needed to avoid a runoff election. (Alternately, he needs a minimum of 40 percent of the votes and a 10-point difference after his most immediate opponent). A gloomy financial forecast may account for his decision to hold the election with two years left in his term. Less than a week before the election, Correa unveiled a buyback plan for defaulted sovereign bonds.
Correa’s presidency has represented a period of relative stability for Ecuador. “Seven presidents in the decade following 1997. Three leaders overthrown. A banking and currency collapse. This was Latin America’s basket case,” writes Henry Manse for World Politics Review. Correa won his first term in 2006 against entrepreneur Álvaro Noboa of the Partido Renovador Institución Acción Nacional. Noboa is running again, this time in a race for second place against former President Lucio Gutierrez of Sociedad Patriótica. Gutierrez was ousted from office by Ecuador’s Congress in April 2005 and barred from holding public post for two years by electoral authorities.
Ecuador has enjoyed booming economic times since the beginning of Correa’s presidency. The economy expanded continuously for the last nine years and Ecuadorians saw poverty levels drop from 52 percent in 1999 to 35 percent in 2008. Additionally, social spending went up by 71 percent under Correa’s watch.
Correa opted to run for reelection, despite the fact that two years remain in his term. A new constitution approved in September 2008 would allow him to seek the bid for a second term, whether now or then.
Forecasts by the International Monetary Fund (IMF) could offer a glimpse into why he chose to advance the election date. The IMF estimates that Ecuador’s GDP growth rate will run at negative 2 percent in 2009 and just 1 percent in 2010. This trend is consistent throughout the hemisphere, with only Peru, Uruguay, and Chile expected to post positive growth results this year. In March, Ecuador’s Central Bank reported an overall drop in exports, GDP, and remittances. Correa’s consistently high approval ratings are showing some signs of a downgrade as well. A CEDATOS poll from March 10 found that Correa’s approval rating fell 10 points down to 60 percent in the first three months of 2009.
One week before the election, Correa’s government announced a plan to buy back defaulted sovereign bonds 2012 and 2030. The government offered to pay 30 cents on the dollar, or roughly $900 million for bonds valued at roughly $3.2 billion Finance Minister Diego Borja assured that the government has the money for the transaction using funds previously allocated to make interest payments. As Goldman Sachs analyst Alberto Ramos explains, Quito might have already repurchased some of the bonds on the sly in the secondary market by taking advantage of dropping bond prices after the default. Vistazo magazine also questioned the proposal, wondering where the money was coming from to pay for the bonds.
Correa believes investors will rally behind his government’s proposal. But the Wall Street Journal and Reuters report that some bondholders will refuse the offer and file lawsuits instead to get full compensation.
To ensure transparency in the elections, more than 200 international observers arrived in Ecuador this week. El Universo offers complete coverage. Angus Reid Global Monitor provides a backgrounder on the new constitution and the 2006 presidential election.
Read the article originally published at the AS/COA website.
How Correa Weathers Quito’s Economic Strom AS/COA Online 02/27/09
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| President Rafael Correa. (AP Photo) |
Ecuador, facing declining remittances and low oil prices, finds itself confronted with financially tough 2009. But the upcoming presidential elections present an opportunity to redirect voters’ attention to other quarrels picked by the administration of President Rafael Correa. His style of governing has mustered ample support for his political party Movimiento Pais while sparking multiple controversies abroad. Along with his Vice President Lenin Moreno, Correa will get another chance to put his formula for government up for a reelection test, thanks to a revamped constitution approved last August. The presidential campaign begins March 10 with the election following on April 26.
Quito’s short-term financial forecast appears bleak. The Economist Intelligence Unit predicts Ecuador faces negative growth of 3.2 percent and, from 2010 up to 2013, experience half the growth rate of the past four years. In addition, the bond default announced by the Finance Minister María Elsa Viteri on February 16 unnerved investors, on guard since December over whether Correa’s government would make payments on what the president called “illegitimate” external debt.
Like most of the countries in the Western Hemisphere, Correa may have to drastically cut spending in 2009 as a result of the global crisis decreasing his popularity levels. Statistics prepared by Ecuador’s Central Bank confirm the downward slope in oil and non-oil related exports, gross domestic product, and remittances. El Comercio reports that international reserves have dropped significantly in the last six months thanks to lower oil demand and prices. Lower inflation rates starting in October stand as one bright spot.
Yet, despite these financial trials, Ecuadorians continue to favor Correa’s administration. A poll by Cedatus/Gallup show that Correa’s approval ratings remain at a solid 70 percent in January. Some of the initiatives undertaken by his government include his calls against renewing the lease for the U.S. air force base in the port of Manta, breaking diplomatic relations with Colombia after Bogota’s unauthorized military raid against guerrillas last year, and threatening Repsol to freeze its assets for non-tax compliance. The Latin American Thought blog offers an explanation of how the initiative to turn the town of Manta into a megaport developed by Hong Kong-based Hutchinson Port Holdings may turn sour as a result of sinking manufacturing numbers in China. On bilateral relations with Colombia, World Politics Review says that after a year “[B]oth sides’ failure to make progress on reconciliation may be politically motivated.” The article explains that while Correa gains support by defending Ecuador’s sovereignty at all costs, Uribe has other matters deal with so that restoring diplomatic ties with its neighbor may not stand as a top priority. To defuse the Repsol affair, a prompt visit by Spain’s Foreign Minister Miguel Angel Moratinos on February 25 forged a compromise to repay 20 percent of the $444 millions demanded by the government by a March 12 deadline, Hoy newspaper reports.
In spite of a new occupant in the Oval Office, Quito’s relations with Washington remained strained after Ecuador’s decision to expel the U.S. Embassy’s First Secretary Mark Sullivan, accusing him of meddling with internal affairs. The move was preceded by the expulsion of U.S. official Armando Astorga on February 7 after Washington ended support for a police support program. In a daily press briefing on February 19, U.S. Department of State Acting Deputy Spokesman Gordon Duguid expressed concern and suggested that the United States is weighing whether or not to engage in diplomatic retaliation.
The Instituto Latinoamericano de Investigaciones Sociales in Quito unveiled an analysis of Ecuador’s state of the economy in 2008.
Read this article as originally published at the AS/COA website.
Chávez Clears the Road for Reelection AS/COA Online 02/18/09
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| Chávez will run for his second reelection in 2012. (AP Photo) |
In a decisive electoral victory on February 15, Venezuelan President Hugo Chávez won the right to run for his second reelection and possible third presidential term after voters approved an end to term limits. This is a political rebound for Chávez, who lost a proposed constitutional reform in December 2007 and important mayoralties in municipal elections last November. With this renewed mandate, he faces the daunting task to deal with rampant insecurity and corruption, rising inflation, and imminent economic adjustments to his vast social programs and fiscal expenditures.
Venezuelan electoral authorities announced that the “Yes” vote won by 54.86 percent of the “No” vote received 45.13 percent with a participation of more than 70 percent. International observers gave the referendum high marks for transparency and underlined the trustworthiness of the referendum’s official tally. But Chávez’s use of all state institutions and media at his disposal to push the amendment strained the process since the beginning. Chávez exerted pressure by emphasizing the lack of political alternatives and warning that Venezuela would crumble without his leadership, said pollster Luis Vicente León.
The opposition accepted their defeat with temperance and asked Chávez to turn his attention to the domestic agenda. Caracas’ Major Antonio Ledezma said that hopefully politicians “have turned that page of the political agenda” and that people “voted yes to solutions for garbage disposal, insecurity, inflation, and anarchy that overshadows governability.” In an interview with the Los Angeles Times, Tal Cual Editor Teodoro Petkoff stressed important inroads made by winning 10 percent of the vote in this referendum in comparison to Chávez’s 2006 reelection victory margin of 64 percent. “And I don’t have the slightest doubt that the deterioration of Chavez’s support will continue through the next presidential election in 2012,” Petkoff adds.
Meanwhile, economists sound the alarm about the dangers laying ahead for the government due to falling revenue from oil exports and inflation. “I would say that Venezuela can count on a sizeable cushion of reserves and foreign exchange liquid assets to help it ride the current economic down cycle. But not for very long. By all accounts, Venezuela is destroying assets much more quickly than it’s been building them, given today’s oil prices,” says Eurasia Group’s Patrick Esteruelas in an AS/COA interview. The Financial Times reports that Chávez announced in his victory speech that he will redouble efforts to face the crisis; he was followed by his Finance Minister Ali Rodriguez, who cautiously referred to a stimulus package to control inflation but said that they are waiting to see at what level crude prices settle at to better determine their revenues for this year.
International leaders greeted Chávez’s victory at the polls positively. Colombian President Álvaro Uribe congratulated Chávez for his “democratic victory” in an effort to strengthen bruised bilateral relations. Spain’s government also praised the electoral outcome in Venezuela and urged for continued dialogue to bridge differences between the political parties, El Nacional reports. Even the U.S. government acknowledged the “civic spirit” displayed by Venezuelans and cautiously hailed Chávez’s accomplishment.
At a February 9 AS/COA panel discussion on the Venezuelan referendum, Barclays Capital Senior Economist for the Andes Alejandro Grisanti said that, even with a victory for Chávez on Sunday, he still must deal with harsh economic realities that could further harm his approval ratings when running for an hypothetical third term in 2012.
Read AS/COA extensive coverage on Venezuela’s electoral process and its oil-based economy.
Carlos Macías Web 