Politics, Business & Culture in the Americas

Monday Memo: Mexican Police – Peru’s Slow Economy – Military Meets FARC – Argentine Debt – Brazil Prison Riot



This week’s likely top stories: Mexico launches a new civilian police force; Peru shows slow economic growth in key commodity sectors; the Colombian military held its first meeting with the FARC in Havana; a U.S. federal judge rejects Argentina’s local debt swap plan; Brazilian authorities are negotiating the release of hostages taken in a prison riot in Paraná state.   

Mexico launches new elite police force: On Friday, Mexican President Enrique Peña Nieto announced the inauguration of a new federal police force or gendarmerie—technically a military force tasked with police duties—aimed at quelling outbreaks of violent crime. The 5,000 new officers will function as a division of the 36,000-strong civilian federal police. National Security Commissioner Monte Alejandro Rubido García said the gendarmerie will protect Mexico’s economic assets—like oil, mines, and farms—from organized crime, especially in rural areas where criminal activity has negatively impacted commerce or tourism. The new police force comes as a result of Peña Nieto’s 2012 campaign promise to reduce violence. Although homicides have been steadily decreasing since 2011, critics say that the relatively small police force will not significantly impact issues of insecurity, especially in Mexico’s urban centers where most of the violent crimes are occurring nationwide.

Peru shows slow second quarter growth: Peru’s GDP grew just 1.7 percent in the second quarter of this year, as compared to 6.2 percent this time last year. Meanwhile, domestic demand grew 2.2 percent, versus 7.1 percent in 2013. Peru’s commodity-driven economy experienced a boom over the last decade that saw average growth of 6.4 percent, but Colombia has now overtaken it as the fast-growing large economy in the region. The country’s halted growth comes as a result of weak performance from the mining, fishing and agriculture sectors. “Mining investments have decelerated, but that will be replaced by a cycle of investments in infrastructure projects,” said Scotiabank economist Pablo Nano, who still expects 4.0 percent growth on the year.

Military leaders join FARC in Havana for first meeting: The first meeting between Fuerzas Armadas Revolucionarias de Colombia (Revolutionary Armed Forces of Colombia—FARC) leaders and the Colombian military occurred in Havana last Friday. General Javier Florez, head of Colombia’s joint chiefs of staff and one of the FARC’s strongest adversaries, represented the military, joining the Colombian government and FARC negotiators for the first time. Humberto de la Calle, the leader of the government’s negotiating team, stressed that there is no current discussion to negotiate a cease-fire, but that the government has formed a subcommittee to determine the procedure for implementing a cease-fire once the two sides have reached a final agreement. Lead FARC negotiator Iván Márquez affirmed that the meeting showed just how much the peace talks have progressed since they began in 2012. Negotiators have already discussed land reform, political participation of the FARC and drug trafficking, while disarmament and the final peace deal have yet to be addressed.

U.S. rejects Argentina’s proposal for local debt swap: U.S. Federal Judge Thomas Griesa ruled last week that Argentina’s latest plan to avoid its default is illegal and “lawless.” The ruling comes in response to President Cristina Fernández de Kirchner’s proposal to allow defaulted bond holders the opportunity to swap out their debt for locally-issued debt. The plan was aimed at resuming interest payments to investors who accepted restructured bonds while evading payment to the hedge funds that are owed approximately $1.3 billion. Griesa had previously ruled that Argentina cannot make interest payments to bond holders that accepted restructuring until the Argentinean government paid the holdouts. Griesa strongly criticized the plan but did not hold the country in contempt, explaining that it would not inspire a willingness to cooperate, and instead pressed the two sides to negotiate an agreement.

Riot in Paraná prison leaves four dead: Four prisoners have been killed and several others injured during an inmate riot at a penitentiary in the southern state of Paraná, Brazil that began Sunday morning. The riot started when a group of inmates overpowered prison guards and in the ensuing chaos, as many as 1,000 prisoners took over several parts of the facility. The riot is said to be caused by prisoners’ frustration regarding inadequacies in sanitation and diet at the prison, although many gangs are taking advantage of the chance to seek revenge on enemies. Two guards are currently being held hostage, and Brazilian authorities resumed negotiations today in an attempt to secure their release and end the riot.

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