Ibero-American News Digest
Privately, Bankers Admit Ibero-American Debt Risks Are Big
The "Brazilian economic model" should be followed by Argentina, and all of Ibero-America, World Bank Vice President for Latin America David DeFerranti told Argentine daily La Nacion during the IMF annual meeting in Dubai, in an interview published on Sept. 22. DeFerranti waxed poetic on President Lula da Silva's "aggressive program for growth and development," and "healthy fiscal policy," which has "restored [investor] confidence." He did, however, allow a tinge of nervousness to creep into his voice, when the interviewer asked him whether there were any parallel between the Argentine crisis of 2000, and the Brazilian situation today. "The context is different, with a floating exchange rate and profound work in the fiscal area," DeFerranti hastily noted. "Of course, there are always risks, but I don't think you can compare the situations."
On the sidelines of the Dubai conference, private bankers are apparently speaking a little more frankly about Brazil, expressing worry about Brazilian President Lula's ability to handle his country's gigantic debt burden. Argentine Finance Ministry sources told La Nacion that the possibility of an eventual Brazilian debt default "is on a lot of people's minds."
IMF Threatens Argentina: Kill More People, Or Else.
Both in its just-released World Economic Outlook report, and in comments from Chief Economist Kenneth Rogoff, the International Monetary Fund has told Argentina that its future depends on whether it imposes further murderous "structural reforms." Rogoff, speaking at a Sept. 18 press conference in Dubai, also warned that Argentina must make an acceptable deal with private creditors to restructure $94.3 billion in debt, on which the government defaulted in December 2001.
Rogoff's blackmail is that if Argentina doesn't reach a deal with creditors, this will affect its international trade, and "it may experience other problems which lead to growth slowing down," such as a loss of trade credits. Besides, he added, the recovery of which the Kirchner government boasts "is not so exciting," when compared to other countries which suffered debt criseshe mentioned Asian nations as an examplebut had much better "rebounds," even while they continued to pay their foreign debt. Argentina, on the other hand, has paid almost nothing, he complained. Rogoff then warned that the country's recovery will remain "vulnerable," unless it imposes the killer reforms the IMF demands: a more "flexible labor market" (i.e., no benefits or protections for workers), restructuring the banking system, and imposing more austerity on provinces. Public finances are currently "unsustainable," he said, and "juridical security"guaranteeing creditors' "rights"is not yet strong enough.
And as for the debt restructuring plan presented at a Sept. 22 press conference in Dubai by Argentine Finance Minister Roberto Lavagna, Wall Street was furious. Although creditors can swap their old debt for different types of new, long-term discounted bondsone type reduces the amount of principal, while another reduces only the interest ratethe overall plan is effectively a 75% writedown of the entire amount. Representatives of the creditors were enraged, labeling the plan "scandalous," and "not serious." Many warned they would go to court, rather than accept Argentina's terms.
Remittances Are Propping Up Mexico's Finances
Cash remittances sent back home from Mexicans living in the U.S. are now a larger source of foreign funds for Mexico than direct foreign investment or tourism.
Nowhere is the need for Lyndon LaRouche's Great American Desert infrastructure development program made clearer, than in the following statistics: For the first six months of this year, cash remittances to Mexico from Mexicans resident in the U.S. totalled $6.13 billion, a 29% increase over the same period last year; and for July, they totalled $1.12 billion, a 33% increase year on year over July 2002. Should this trend continue, 2003 remittances will exceed the record $9.81 billion sent in 2002. Even more striking, and revealing the true state of the Mexican economy, is the fact that in four statesJalisco, Michoacan, Guanajuato and Zacatecasthe remittances sent from U.S.-based Mexicans, were larger than the amount of funds these states receive from the federal government.
President Vicente Fox was so manic about the income flow, that he told the press after meeting with Mexican-American businessmen on Sept. 25, that remittances "are our principal sources of foreign income" (which is not the case, as oil still takes the lead), and that "the 20 million Mexicans in the United States generate a GNP which is slightly greater than the $600 billion generated by Mexicans in Mexico."
Former Salinas Official Launches Dirty War on Mexican Cardinal
The opening of an investigation by the Mexican Attorney General's office into alleged narco money-laundering charges by the Roman Catholic Cardinal of Guadalajara, Juan Sandoval Iniguez, stinks of the Synarchist's efforts to trigger a re-run of the 1920's-1930's Cristero War in Mexico, to sink the country in chaos. President Vicente Fox's Attorney General, Rafael Macedo, opened the investigation into Cardinal Juan Sandoval Iniguez, his deceased mother, his numerous siblings, and a few others politically associated with him, on behest of Jorge Carpizo McGregor, one of the filthiest politicians in Mexico, who served as Attorney General under President Carlos Salinas de Gortari.
The existence of the investigation, which reportedly started much earlier, was revealed only on Sept. 11 by Reforma daily, which reported that the Attorney General's anti-organized crime and money-laundering divisions had sent an official request to the National Banking and Stock Market Commission, that any and all financial accounts, inside or outside Mexico, of Cardinal Sandoval and his family, be examined. At least one bank account of the Archdiocese of Guadalajara has reportedly been frozen.
Carpizo has gone so far as to hand over to the current Attorney General, a document allegedly prepared by an unnamed Mexican government intelligence agency, which charges that Cardinal Sandoval and his predecessor, the murdered Cardinal Juan Jesus Posadas Ocampo, were part of a Vatican strategy to get resources from the drug trade, as "a third way of financing."
Cardinal Sandoval responded that the Carpizo-initiated investigation is a blatant political hit, which seeks to silence him, and anyone else demanding a real investigation into the assassination of his predecessor, Cardinal Posadas Ocampo, on May 24, 1993.
Carpizo was the Attorney General when Cardinal Posadas was murdered. Within hours of the assassination, he told the nation, before any investigation had taken place, that the Cardinal had been killed "by accident" in crossfire between two drug-trafficking bands. When forensic evidence proved that the 57 bullets which killed him came from one direction only, at close range, Carpizo modified the story, to say that the Cardinal was killed, when one drug gang "mistook" him for the top trafficker of their rival band! That, to this day, is the official line on how Posadas was killed.
Since 1993, Posada's successor, Cardinal Sandoval, has refused to let the case be closed, charging that the assassination was "a state crime," and those responsible must be brought to justice.
The investigation of Sandoval is polarizing the nation, with many of the people taking sides on whether Sandoval should be investigated, doing so according to their profile, whether "Catholic" or "anti-clerical." The "anti-clericals" say no one is above the law, and he must be investigated; some within the Church are talking of this as renewed "persecution of the Church."
Salinas Offers to "Help" Fox Get IMF Reforms Passed
Former Mexican President Carlos Salinas de Gortari announced that he wants to "help" current President Vicente Fox ram through "structural reforms," in a high-profile interview to Reuters, published on Sept. 23. Salinas stressed that how important it will be to get fiscal, labor, and energy reforms approved in the next few months. Above all, Wall Street and its affiliated synarchists want to guarantee the privatization of the energy sector, and Salinas has put himself forward as the man to "help" the discredited and weakened Vicente Fox achieve this. In coming months, Salinas said, "the voices that will count, will be those that are well informed, and have a positive and constructive attitude, and among those, you will find mine.
"Reuters, of course, boosts Salinas as just the man to "offer the weak Fox government some air," although it adds a comment by a prominent political analyst, who reports that "seven of every ten Mexicans still think [Salinas] is the incarnation of Satan."
Brazil Says Only U.N. Can Secure Peace in Iraq
"A war can perhaps be won single-handedly. But peace lasting peace cannot be secured without the support of all," Brazilian President Lula da Silva stated in his speech before the United Nations General Assembly opening on Sept. 23. Only under the leadership of the U.N. can the "impasse" in Iraq be overcome, and the U.N. must have a guiding role in restoring Iraqi sovereignty, "as soon as possible," he stressed.
There are "worrisome signs" of an attempt to discredit the United Nations, and divest it of its authority. "Let there be no ambiguity on this subject. No matter how invaluable its humanitarian work, the United Nations was conceived to do more than simply clear away the rubble of conflicts it was unable to prevent. Our central task is to preserve people from the scourge of war.... Let us not place greater trust on military might than on the institutions we created with the light of Reason and the vision of History."
The Brazilian President pointedly said that nations which practice democracy, must work to ensure that also takes place in the decision-making in international affairs. He called for the ranks of the permanent members of the U.N. Security Council to be expanded to include developing sector nations, and made clear Brazil wishes to become part of it, to represent its region. The General Assembly, too, has the legal means to provide an alternative "to a veto-induced paralysis."
He returned to his theme that the war that is needed today, is the one against hunger, the hunger which a fourth of the world's population, including 300 million children, suffers. Lula reiterated his proposal for a Global Fund to Fight Hunger, and proposed that the UNGA set up a World Committee to Fight Hunger, made of Heads of State from all continents.
Tensions Rise Between Bush and Lula Administrations
President Lula da Silva was visibly annoyed during President Bush's address to the UN General Assembly, and barely clapped at its conclusion, in notable contrast to his response to France's Jacques Chirac, Brazilian daily O Globo reported Sept. 24. Nor did he attend the heads-of-state reception given by Bush that evening.
The Bush team is not happy with Brazil's role leading developing sector hardliners at the WTO meeting in Cancun. Trade Representative Robert Zoellick singled out Brazil by name at least three times for being a leader of the "culture of protest" at the WTO meeting, in a thuggish op-ed published in the Financial Times on Sept. 22. (What infuriated Zoellick most, is that Brazil declined to work with the U.S. against the European Union, "turning instead to India, which has never supported opening markets.")
Brazilian Foreign Minister Celso Amorim told journalists in New York that Lula had complained to Bush about the singling out of Brazil for the WTO collapse. Lula, for his part, told the Council on Foreign Relations on Sept. 25, that he had told Bush: "We don't want to be treated as second class citizens."
Insurrection by Soros-backed Coca Growers Threatens Bolivia
The FARC-linked coca growers movement in Bolivia, which Executive Intelligence Review has documented to be an integral part of George Soros's drug legalization apparatus, launched "a war for gas and coca" in the third week of September. At least seven people have been killed so far, and scores more wounded, as a result of violent confrontations between the Army and coca producers ('cocaleros'), who are blockading highways, seizing hostages, and cutting off food supplies and other commerce from major cities, the capital included.
The ostensible excuse of what is shaping up as a full-scaled uprising against the Sanchez de Lozada government, is opposition to the government's plan to export natural gas to the United States through Chilean ports. The coca producers, including drug legalizer Evo Morales and his cohort Felipe Quispe, aka "El Mallku," are taking advantage of the widespread and quite fervent opposition to the gas plans. The opposition is both because the deal will allow the multinationals sell the gas, at almost nil benefit for the nation, and because it favors Chile. The issue of Bolivia using Chilean ports is an emotional one, stemming from Chile's seizure of Bolivia's Pacific coast during the 1879-1881 War of the Pacific.
The mobilizations are directed against mechanization of agriculture, the Free Trade Area of the Americas (FTAA), and the government's land distribution law, but are also demanding legalization of coca production. On Sept. 19, Morales declared "a war for gas and for coca," while Quispe threatened that road blocks would go on for months, until the "murderers" in the government are ousted. Peasant marches and mobilizations have occurred both in La Paz and Cochabamba, as well as in other locations around the country, but became especially violent over the weekend of Sept. 20-21, when the Army had to rescue 800 tourists who were unable to leave the town of Sorata, because of road blocks. The Army rescued the tourists, but when cocalero snipers shot at the caravan of vehicles bringing them out of the town, a violent confrontation ensued in which five people were killed. Further violent clashes occurred on Sept. 22, after Army troops attempted to remove roadblocks on the highway between the capital of La Paz and the city of Oruro, to the south.
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