Parts of Argentina were paralyzed on Thursday after the country's biggest unions shut down transportation and blocked entrances to Buenos Aires. The unions are staging a 24-hour strike to protest rising inflation and cuts to government subsidies, and are currently negotiating wage increases. Industrial unions—including metal and oil workers allied with President Cristina Fernández de Kirchner—did not participate in the strike.
Hugo Moyano, leader of the Confederación General del Trabajo de la República Argentina (General Confederation of Labor of Argentina—CGT) led the 24-hour strike, which included bringing transportation to a near stop in the capital city, and shutting down many businesses and public schools.
This is the second strike Moyano has organized against President Kirchner since she disregarded his union's demands for higher salaries and better representation in 2011. The first strike Moyano staged against President Kirchner took place in November 2012 and called for tax cuts and pay increases.
After years of spending on social programs and subsidies, Kirchner's government is facing high inflation, forcing the administration to devalue the Argentine peso and reduce subsidies for gas and water by 20 percent. In February, economists estimated that Argentina's inflation rate had risen to 34.9 percent from the same period last year. According to a March 29-April 3 Management & Fit survey, President Kirchner's approval rating fell to 25.9 percent in April of this year.
Ten individuals suspected of the kidnapping and sexual exploitation of Maria de los Ángeles “Marita” Verón were sentenced to prison in Tucumán, Argentina on Tuesday.
While walking to a doctor’s appointment in 2002, Verón, 23, disappeared, and was suspected to have been forced into a sex trafficking ring. All 13 individuals accused of being involved were cleared of charges in 2012. However, the ruling was overturned in December of 2013 and now 10 of the 13 originally accused have been found guilty.
Brothers Jose and Gonzalo Gomez were sentenced to 22 years in prison each, seven others received between 10 and 17 years sentences, and the last suspect will server 15 days of house arrest. Of the original 13 accused, two were acquitted and one passed away.
Marita’s mother, Susana Trimarco, is still searching for her daughter and is seeking new litigation on human trafficking in Argentina. Over the past twelve years, she has helped rescue 6,400 victims of sex trafficking, including establishing the foundation Fundación María de los Ángeles in 2007 and leading an initiative to have an anti-trafficking bill signed into law in 2008.
A 2013 report showed that Argentina is a trafficking hub and that 70 percent of human trafficking cases have some connection to drug trafficking. Most victims are between 15 and 17 years old, and while about half of the victims are from Argentina, 33 percent come from Paraguay.
Argentina celebrated the thirty-second anniversary of the Guerra de las Malvinas (Falklands War) on Wednesday with a rally lead by President Cristina Fernández de Kirchner and the release of a new 50 peso bill picturing the islands.
The commemoration the 74-day conflict between Argentine and British forces took place at the Malvinas Argentinas Hall at the Casa Rosada, with government officials, union leaders and war veterans in attendance, among others. The new banknote pictures a map of the Malvinas Islands in the national colors of Argentina—blue and white.
On April 2, 1982, in the final years of the Argentine military dictatorship, Argentina launched a failed invasion to repossess the islands, resulting in a bloody war where 649 Argentine and 255 British soldiers were killed. Argentina surrendered on June 14 of the same year.
The United Kingdom has maintained control of the territory since then, and a clear majority of island residents supported British rule in a March 2013 referendum vote. Still, disputes have resurfaced in recent years, as Argentina continues to claim the territory as its own, with Fernández de Kirchner saying at the rally “I have endless confidence that we will recover these islands.”
UK Prime Minister David Cameron has attested that the he will not negotiate over the sovereignty of the islands.
A debate dominates the end of my dinners at my parents’ house: how to get home? I live a mere seven blocks away, a brief walk across a park. Though I’m an independent urban type, in the labyrinth of subjective insecurity that is Buenos Aires these days, the answer is not as obvious as it seems.
When I walk to my bus stop in Buenos Aires, I zip my purse shut and clutch it tight to my body, like a football player running toward the end zone. When I play Candy Crush on the subway, I hold my phone in a two-handed death grip, lest it be snatched away. After a girls’ night out, I ask my friend to text me when she’s safely home. On warm spring days, my car windows remain shut because robberies have been known to happen at red lights.
And those deeper down the rabbit hole consider me foolhardily naïve in my lack of precaution. I know people who drive from their guarded apartment building garage to their office parking lot, and who avoid setting foot on the street even in broad daylight. Iron bars cover many ground floor windows on Buenos Aires streets, and increasingly the next floor up, too. Barbed wire wraps around some houses’ entrances like ivy. And then there are those who move to gated communities, where they can finally leave these quotidian safety measures behind—but instead end up living in a sort of custom-designed Truman Show of safety from “others.”
But the higher the walls, the more upper-middle-class porteños seem to be afraid. How necessary are these measures, and the correlated paranoia that seems to seep into every step we take?
As surging inflation takes a toll on Argentine consumers, the Argentine government affirmed on Tuesday that it would levy fines against supermarkets who fail to respect voluntary price controls that many stores and wholesalers agreed to in December.
On Tuesday, Chief of Cabinet Jorge Capitanich said that the details of the new sanctions would be made public by the Secretary of Commerce this week. Meanwhile, he encouraged Argentines to act “rationally and effectively” and to not purchase overpriced items that would validate “product price increases due to speculation from industrialists, traders and entrepreneurs."
Initiatives to freeze the costs of common goods at supermarkets, accompanied by ongoing criticism of business owners and banks, have increased as the Argentine government tries to confront rising inflation. The government has also encouraged citizens to report overpriced items to officials by using a free app for smartphones called “Precios OK” (Okay Prices).
Despite the measures, however, analysts have questioned whether attempts to tackle inflation without implementing tighter fiscal and monetary policies will be sufficient. “If the government decides to maintain the interest rate below the rates of inflation and devaluation, mechanisms will arise that increase the demand for dollars,” read a report published in late January by the Instituto Argentino de Analisis Fiscal (Argentine Institute of Fiscal Analysis—IARAF).
The Argentine government adopted new legislation limiting online buying on Tuesday in an effort to defend domestic production.
The resolution, adopted by Argentina’s tax agency, the Administración Federal de Ingresos Públicos , and published in the Boletín Oficial, restricts Argentines to two tax-free purchases of up to $25 on foreign-based websites per year, with a 50 percent tax imposed on any additional amount spent.
Argentines will also no longer be able to have items purchased on foreign websites delivered directly to their residences, but will have to pick up their packages at a customs office. The new resolution changes the way the government gathers information on shipments, requiring the buyer to fill out paper work on their transaction before picking up their order. Prior to the resolution, increased online spending made it difficult for Argentine Customs to track online transactions, but with the newly imposed measures, the government expects easier application of the import tax.
While international online purchasing will have tax restrictions, national online spending will still be unlimited. With Argentine reserves at $30 billion—their lowest levels since 2006—and a 30 percent drop since last year, the resolution aims at decreasing dollars from leaving the country, which can occur when purchasing from foreign countries. According to Cabinet Chief Jorge Capitanich, Internet purchases in Argentina have doubled over the past year, and Argentines spent almost 30 million dollars during an organized Cyber Monday sale last month.
Argentine government officials formalized a $500 million plan to improve the distribution of electricity in Buenos Aires this week, but remained strongly opposed to raising utility rates in order to alleviate the city’s ongoing energy crisis.
The measure comes after the hottest heat wave on record prompted a series of power outages, leaving hundreds of thousands of Argentines without light and running water in December and January. According to the Argentine Ministry of Infrastructure, Julio De Vido, energy consumption reached unforeseen levels during those two months.
The new government plan will enable two privately-owned electric companies, Edesur and Edenor, to install new substations and upgrade low-voltage cables in neighborhoods affected by the recent blackouts. Edesur and Edenor serve 13 million residents of Buenos Aires and, according to De Vido, will have to increase work crews by 20 percent.
Many, however, accuse the government of sidestepping its own role in the energy crisis. “The outages are synonymous with failure,” said Sergio Massa a likely presidential candidate from the opposition party Frente Renovador (Renewal Front).
Likely top stories this week: Brazil will reduce lending by 20 percent next year; Argentina wins a stay on its $1.33 billion payment; Tropical Storm Sonia Hits Mexico; Honduras’ police chief denies abuses; Brazilian delegation opposes Uruguayan marijuana legalization.
Brazil to Reduce Lending Due to Budget Deficit: Brazilian Finance Minister Guido Mantega said Friday that Brazilian development bank BNDES will reduce lending by 20 percent next year, down to about 150 billion reais ($66.6 billion) from this year's estimated 190 billion reais. The announcement came after an Oct. 31 report showed Brazil’s budget deficit widened to 3.3 percent of gross domestic product, the most since November 2009. Some experts speculate that Brazil's credit rating could be cut.
U.S. Court Upholds Stay on Argentine Debt Payment: The 2nd U.S. Circuit Court of Appeals ruled in favor of Argentina on Friday by denying a motion that would have forced the country to start paying $1.33 billion to holdout bondholders. Friday’s decision will permit Argentina to make a second appeal to the U.S. Supreme Court before it is forced to pay the $1.33 billion to NML Capital Ltd and other holdout bondholders who did not accept a debt swap in 2005 and 2010.
Tropical Storm Sonia Hits Mexican Coast: Tropical Storm Sonia hit Mexico's Pacific Coast on Monday morning near the city of El Dorado in Sinaloa. By the time the storm made landfall, it was downgraded to a tropical depression and winds had decreased to about 35 mph. Though the storm is weakening, the U.S. National Hurricane Center said it could still cause floods and landslides in the region. Mexican authorities issued storm warnings from Mazatlan north to Altata on Sunday, and the government of Sinaloa state canceled classes on Monday in five municipalities.
Honduran General Denies Role in Police Abuses: In an interview, Honduran general and police chief Juan Carlos Bonilla denied knowledge or involvement in a wave of police abuses this year in which at least seven detainees have gone missing or been killed in police custody. He also said that he was not involved in setting up death squads starting in 1998, as reported by the police department's internal affairs section in 2002.
Brazilian Delegation Concerned About Uruguayan Marijuana: Brazilian political leaders from the southern state of Rio Grande do Sul will travel to neighboring Uruguay this Tuesday to oppose Uruguayan legislation that will legalize marijuana sale and consumption in the country. The Brazilian delegation will testify before the Uruguayan Senate's health committee in an attempt to prevent the country from moving ahead with legalization.
Barrick Gold Corporation, a Canadian mining company and the world’s largest gold producer, announced Thursday that it has temporarily halted operations at its Pascua-Lama gold mine in the Andean border region between Argentina and Chile. Production was scheduled to begin by early 2014, but environmental regulations, depreciating gold prices and declining company profits led to a decision to indefinitely suspend construction at the mine. Barrick said it has already spent over $5 billion of the total estimated project cost of $8.5 billion. The company told investors in a quarterly earnings statement that the postponement would provide capital savings of up to $1 billion in 2014.
Barrick’s stock prices fell 8.65 percent in April when a Chilean appeals court announced that it would block operations at Pascua-Lama due to “environmental irregularities.” The announcement came after members of Diaguita Indigenous communities filed a complaint that the mine had polluted glacial deposits and contaminated scarce water resources in the Atacama Desert. Chilean Interior Minister Andrés Chadwick welcomed the April announcement and said he hoped the company would be able to address the court’s concerns and conduct environmentally sound operations. The Chilean government has not announced plans to revise or lift the restrictions.
Officials voiced greater concern in Argentina, where operations were not discontinued until the company’s recent announcement. On the Argentine side of the mine, Barrick operations provide thousands of jobs and accounts for a third of San Juan province’s economy. Officials there have advocated repeatedly for the project, and it remains unclear how the closure will affect the region’s economy. Nevertheless, Guillermo Calo, Barrick’s top official in Argentina, said the company still plans to invest $400 million there next year.
Voters in Argentina’s October 27 midterm elections delivered a clear message to the country’s politicians on Sunday: they are ready for change. The incumbent, Peronist-affiliated Frente Para La Victoria (Front for Victory—FPV), led by President Cristina Fernández de Kirchner, suffered key losses as the country voted on available seats in one-third of the Senate and half of the Chamber of Deputies.
The results may reflect voters’ concern with issues such as rising inflation, corruption, and crime, which have become increasingly severe in recent years under the Fernández de Kirchner government. They also suggest that the 2015 elections may feature a divided Peronist movement—as well as a plausible non-Peronist alternative for the first time in 12 years.
Though the FPV maintains a majority in both houses of Congress—40 of 72 seats in the Senate and 132 of 257 seats in the Chamber of Deputies—their losses in 12 of 24 districts in Sunday’s elections indicate that the party’s popularity is slipping. Perhaps the most important loss took place in the province of Buenos Aires, a traditionally Peronist region with over 11 million registered voters.
As predicted in the August primaries, Sergio Massa, an ex-FPV candidate and mayor of the populous city of Tigre, secured a seat in the Chamber of Deputies. His new Peronist-inspired party, Frente Renovador (Renewing Front), provides traditional Peronist voters with an alternative to the FPV. On Sunday, Massa soundly defeated his FPV competitor, Martín Insaurralde, who trailed by over twelve points. Whereas the FPV considers itself a leftist party, Massa’s Frente Renovador appears to represent more centrist, business-friendly interests.