FRIDAY..8. IN 70 ARGENTINE CITIES RIGHT NOW, PROTESTERS ARE SAYING “NO MORE” TO KILLERS OF WOMEN (Quartz Online)By Cecilia Nahon4 June 2015The article “A Body, a Pistol and Few Answers” (page one, May 16) is full of misleading innuendos that deserve clarification.The investigation about Argentine prosecutor Alberto Nisman’s tragic death is ongoing, conducted by the corresponding public prosecutor and the judge. Sandra Arroyo Salgado participates in it as a private prosecutor (querellante in terms of the Argentine Code of Criminal Procedure) and doesn’t lead a “rival investigative team.” The Argentine Judiciary is independent and well-equipped to cope with this case.Also, it should be underscored once again that the alleged complaint that Argentina’s highest authorities conspired to cover up Iranian involvement in the 1994 tragic terrorist bombing is completely baseless. These unwarranted accusations have been rejected by Argentina’s courts on three different occasions on the grounds of nonexistence of a crime.Indeed, after Judges Maria Romilda Servini de Cubria and Ariel Lijo declined to take the case due to lack of evidence, Judge Daniel Rafecas rejected the complaint filed by Mr. Nisman. A month later, a Court of Appeals upheld that decision, and finally last April 20 General Prosecutor Javier de Luca dismissed the appeal filed before the Federal Court of Cassation. The latter court has just ordered the file closed.The coincidence among all intervening judiciary instances in dismissing Mr. Nisman’s allegations is compelling enough to lead anyone to the conclusion that Mr. Nisman’s accusations were unfounded. These judicial decisions are public and clearly based on the law. Yet the insistence in divulging unsubstantiated theories is striking.Argentina is a vibrant democracy that has actively promoted an internationally acknowledged human-rights policy. Its unwavering commitment to truth and justice is inherent to that policy and shouldn’t be put into question.Cecilia NahonAmbassador of ArgentinaWashingtonBy Jonathan Gilbert4 June 2015Thousands of people rallied in cities across Argentina on Wednesday to demand more robust action to prevent violence against women after a spate of murders. On Twitter, President Cristina Fernández de Kirchner denounced ”a culture that devastates women.” More than 1,800 women died between 2008 and 2014 in episodes of domestic violence, according to La Casa del Encuentro, a local women’s rights group. Organizers of the rallies urged officials to enforce the provisions of a 2009 law devised to crack down on violence against women. Speaking in Buenos Aires, Juan Minujín, an actor, said: ”This is a unanimous cry for coordinated action that tackles the problem. We don’t want more tears of mourning.”By Kamilia Lahrichi, Special for USA TODAYJune 3, 2015BUENOS AIRES — Tens of thousands of people took to the streets across Argentina on Wednesday to protest recent violence against women in a region where the abuse has been endemic.The demonstrations were prompted in large measure by a May case of a pregnant 14-year-old allegedly beaten to death by her boyfriend. Police found her body buried in the suspect’s courtyard. In April, the country was shocked after the estranged husband of a kindergarten teacher slit her throat in front of her class, AFP reported.Men, women and children in the main square of the presidential palace held banners with the names and pictures of women who have been killed.“I am your mom. I am your sister. I am your wife. I am your daughter. Respect me,” one handwritten sign read.Violence against women has been a major problem in Argentina. Nationwide, there was a femicide — the killing of women because of their gender — every 35 hours from 2007 to 2012, according to La Casa del Encuentro in Buenos Aires. In 2014, there were 277 murders of women in Argentina, the group estimated.Luis Echeveria, 21, a student at Salvador University in Buenos Aires, said he joined Wednesday’s protest to support women.“I was born privileged in this society because I am a man and we have the right to decide over women,” he said.Including the Caribbean, Latin America is home to more than half of the world’s 25 countries with the highest femicide rates, according to the Small Arms Survey, a research organization in Geneva that tracks armed violence.Despite laws criminalizing gender-based violence, El Salvador has the highest rate of women murdered in the world, the organization said in 2012. Guatemala ranked third and Honduras sixth.A boy stands on his mother’s shoulders as thousands march Wednesday for women’s rights in Buenos Aires. (Photo: Kamilia Lahrichi, for USA TODAY)Latin American countries have taken few steps to curb abuses against women.In Bolivia, only 96 out of 442,000 complaints of gender-based violence from 2007 to 2011 were acted on by authorities, according to the Center of Information and Development of Women in La Paz.Bolivia and Ecuador have defined femicide as a special crime. Guatemala has created special prosecutor units and tribunals to tackle gender violence.Although numbers are hard to come by, violence against women keeps rising, local and international organizations say.“We need official statistics to develop effective policies and an adequate budget to implement these policies,” said Mabel Bianco, president of the Foundation for the Study and Research on Women in Buenos Aires.Roberto Castro with the Regional Center for Multidisciplinary Research of the National Autonomous University of Mexico said: “The main problem with the current policies in many countries of Latin America is that there are sometimes very good laws, but its implementation is difficult.”Part of the problem is the pervasive culture that encourages abuse toward women.“Charges [against criminals] are minimal because justice, too, is patriarchal, which feeds the cycle of violence,” Marcela D’Angelo of the Abolitionist Campaign, a feminist organization in Buenos Ares, told USA TODAY.By Mac MargolisJune 3, 2015This much is certain.On Jan. 18, Argentine star prosecutor Alberto Nisman was found dead, with a bullet wound to his head, in a pool of blood on the bathroom floor of his apartment in an upscale Buenos Aires neighborhood.Almost everything else about the demise of the chief investigator into the worst terrorist attack on Latin American soil — the time of death, whether it was a murder or suicide, and how a team of bodyguards missed the action — remains a mystery.Yet just when the nation seemed to have resigned itself to that enigma, a new twist to the tragic plot promises to keep the Argentines in gossip and conspiracy theories for many news cycles to come.This week, a police video surfaced suggesting possible tampering at the scene of Nisman’s death. The footage shows police investigators in Nisman’s apartment handling evidence without protective latex gloves and, at one point, using tissue paper to clean the blood-smeared .22 caliber Bersa pistol that fired the fatal bullet.Viviana Fein, the lead inspector on the Nisman case, has denied any official mischief or bungling, claiming that the scene of his death “was not contaminated.” But the video, which aired on a popular news program and became an Internet hit, has revived chatter about a case that most Argentines — not least President Cristina Fernandez de Kirchner — thought had gone cold.Recall that Nisman in early January had accused Fernandez of obstructing his probe into the 1994 bombing of a Jewish Community Center, which killed 85 people. He died the day before he was scheduled to lay out his findings to Congress. Those charges sparked public outrage, a media frenzy, an instant book and a parallel forensic investigation by Nisman’s ex-wife.Fernandez fiercely denied any wrongdoing, airing suspicions that the prosecutor had been murdered by “dark forces” looking to incriminate her. Argentine courts summarily dismissed Nisman’s charges.The whole tragedy might have faded there to be spun into a poignant tango, but in Argentina, where even ghosts are partisan — think of the two decade-long battle over the remains of Eva Peron — the bandoneon plays on.The death-scene video “shows how not to do things,” Ernesto Duronto, vice president of the national forensic association, declared. “This way they wipe everything, not just the blood but the finger prints that could have been underneath.”On May 31, La Nacion, a major Buenos Aires daily, reported that Nisman’s computer had been used after his death.Investigators are looking into allegations that his Samsung PC was hacked and some documents altered remotely.For Fernandez, the timing is awkward. Argentina’s economy is contracting, while inflation, debt and unemployment are rising. A nasty battle with bondholders, which has frozen Argentina out of the international credit market for a decade, rages on, a clear sign that hubris still runs deep on the Rio Plate.Presidential elections are slated for October and although she is ineligible to run, Fernandez is counting on a win by the Victory Front, her faction of Peronismo, the country’s leading political brand.The new twist in the Nisman tragedy is unlikely to revive his allegations against her, which three judges have refused to hear. Fernandez’s preferred candidate, Daniel Scioli, the governor of Buenos Aires province, has been gaining in the polls.But Argentines may need something more to quiet their ghosts. The country’s last big case of famously bungled forensics was the Amia bombing that Nisman was investigating, which has yet to be solved. Now, the mystery of Nisman’s death risks ending up the same way.3 June 2015WASHINGTON, June 3 (Reuters) – Argentina has failed to take sufficient steps to bring the quality of its economic statistics in line with global standards, the International Monetary Fund’s board said on Wednesday.The IMF, which requires accurate data to analyze the world’s economies, censured Argentina in 2013 over failing to improve its inflation and gross domestic product figures, putting the country at risk of official sanctions that could have barred it from voting on IMF policies and from accessing financing.The IMF later signaled that Latin America’s third-largest economy was making progress in improving its data quality and gave it a timeline for improvements, which it said on Wednesday had not been completely met.“It determined that Argentina is not yet in full compliance with its obligation under Article VIII, Section 5 with respect to the accurate provision of CPI and GDP data to the Fund,” the board said in a statement.The IMF said it would extend the review by a year.The IMF said in December that Argentina had made progress in rectifying its data standards, although many analysts and private economists continued to doubt the credibility of the data.Critics of the government say the country’s second default in 12 years in 2014 worsened the outlook for the already struggling economy and prompted the government to present more optimistic figures in an effort to calm markets and consumers.Analysts accused Argentina’s government of under-reporting inflation since early 2007 for political gain and to reduce payments on its inflation-indexed debt. The country agreed to revamp its consumer price index last year in a bid to win back the trust of financial markets.But the new index continues to clock inflation at well below analysts’ estimates, and the government has stopped listing the products measured, raising questions over how much the data is being dragged down by price controls that the administration puts on scores of food and household items.By Dimitra DeFotis3 June 2015An Argentine investigator this week is pointing to computer evidence that could indicate foul play in the death of a controversial prosecutor.The January death of attorney Alberto Nisman, 51, matters in an election year and therefore for markets. The Argentine equity market has been on a tear this year, with the Global X MSCI Argentina ETF ( ARGT) up nearly 15%. The rest of Latin America and emerging markets overall have been weaker: the Vanguard FTSE Emerging Markets ETF ( VWO) is up 5.6% year to date. The iShares Latin America 40 ETF ( ILF) is down 4.6%.Nisman was murdered or committed suicide hours before he was to present evidence in an alleged conspiracy in the 1994 bombing of a Jewish community center in Buenos Aires, and alleged coverup of the parties involved. Iran denies any role. A related case involving President Cristina Fernandez de Kirchner, who cannot run for reelection this year, was dropped. The Wall Street Journal reports:Nisman’s “Samsung laptop logged the input of up to three flash drives just after 8 p.m., [investigating prosecutor] Viviana Fein told Argentine media on Monday, some hours after a gun was held to his head and discharged. Investigators are looking into whether the computer–which contained data from his investigation of Iran’s suspected role in a 1994 terror bombing in Argentina–was accessed locally or remotely and whether its time registry could have been changed.”3 June 2015The following is a press release from Standard & Poor’s:NEW YORK (Standard & Poor’s) June 3, 2015–Standard & Poor’s Ratings Services said today it assigned its ‘CCC-‘ issue-level rating to the province of Buenos Aires’ (PBA; CCC-/Negative/–) $500 million dollar-denominated senior unsecured notes due 2021. The PBA will use the proceeds to fund health care, education, infrastructure, and other projects currently under way or that it plans to carry out during 2015. The PBA will also use the proceeds to improve its debt maturity profile. The province is facing the maturity of its $1.05 billion 11.75% international bond due Oct. 5, 2015. Together with the new issuance, the province announced a global debt exchange offer for this bond, which we will be shortly assessing according to our criteria (please see “Rating Implications Of Exchange Offers And Similar Restructurings, Update,” May 12, 2009).The foreign currency rating on the PBA reflects our ‘CCC-‘ transfer and convertibility (T&C) risk assessment for the country (foreign currency: SD/SD; local currency: CCC+/Negative/C). We do so to reflect the likelihood that the sovereign could restrict the domestic entities’ access to foreign currency for their debt obligations. Argentina’s external liquidity continues to be pressured, particularly due to the sovereign’s default since July 30, 2014. In our view, we have fully incorporated these risks in our ‘CCC-‘ foreign currency rating on the province.Including the $500 million issuance, we expect PBA’s total debt to be more than ARP111 billion or about 43% of the province’s estimated 2015 operating revenues, compared with ARP90.3 billion at the end of 2014. Given the PBA’s moderate debt level, we don’t believe this issuance will hurt the province’s financial profile.A deteriorating macroeconomic environment–weak economic growth, high inflation, a dual exchange rate, and uncertainty over medium-terms prospects, which further exacerbate Argentina’s volatile and underfunded intergovernmental institutional framework–limits the PBA’s creditworthiness. The province posted an operating surplus of ARP3.3 billion, or 1.7% of operating revenues, in 2014, higher than 0.2% in 2013. This stems from ARP4.5 billion in extraordinary nontax revenue following the 2013 debt restructuring agreement with the federal government. The PBA’s deficit after capex was 0.4% of total revenues. We expect some volatility in its fiscal results in 2015 and 2016 due to inflation of 35%-40%. We also expect the province to tighten its revenue collection while continuing to restrain the growth of its operating expenses amid high inflation.As of the end of 2014, the province’s debt totaled ARP90.3 billion, almost 58% of which was denominated in foreign currency. This factor underscores the PBA’s exposure to currency risk because adverse exchange rate movements could increase debt amid the Argentine peso’s consistent slide. As of Dec. 31, 2014, PBA owed 37.5% of its total debt to the federal government, 53.4% to domestic and international bondholders, 7.8% to multilateral credit organizations, and the remaining 1.3% to bilateral credit agencies.8. IN 70 ARGENTINE CITIES RIGHT NOW, PROTESTERS ARE SAYING “NO MORE” TO KILLERS OF WOMEN (Quartz Online)By Maria Sanchez DiezJune 03, 2015Chiara Paez was found dead in the Argentine city of Rufino. Her boyfriend had beaten her to death and buried the body when he learned she was pregnant. She was 14 years old. Maria Eugenia Lanzetti was a 44-year-old kindergarten teacher in Cordoba with a restraining order against her husband. It didn’t stop him from sneaking into her classroom and slitting her throat in front of her students.These two high-profile murders have triggered outrage in Argentina. This evening demonstrators are marching in Buenos Aires and other 70 cities across the country as part of the campaign #NiUnaMenos (“Not One Less”), which has been spreading through social media, reaching also Montevideo in Uruguay and Santiago in Chile. People have been tweeting pictures of the marches from various cities:Among the hundreds of thousands of messages of support, there have been some from personalities such as Liniers, a popular cartoonist; Estela de Carlotto, the leader of the influential civil-rights movement Grandmothers of the Plaza de Mayo; Lionel Messi, the soccer player of FC Barcelona; and Argentine president Cristina Fernández de Kirchner:3 de junio. Plaza Congreso. Basta de femicidios. #NiUnaMenosThe hashtag originated in a small chat between a handful of women in the Buenos Aires cultural milieu, who organized a reading marathon as a protest against gender violence. “We did everything virtually.We are an unorganized organization,” Gaby Comte, an editor who was involved in those early conversations, told Quartz.Comte said the death of the 14-year-old girl led the journalist Marcela Ojeda and some of these women to ask to each other on Twitter: “Actresses, politicians, artists, entrepreneurs, social references … women, all … Aren’t we going to raise our voice? They are killing us.”They came up with the hashtag and a date.The protestors’ main demand, said Comte, is that the government enforce a tough law on violence against women that was passed in 2009, but has proved ineffective in practice because of budget shortages. Fifteen Latin American countries have laws against gender-based attacks, but, the UN said in a 2014 report (pdf, p. 10), “they have not developed the necessary institutional mechanisms, including those relating to access to justice or human resource training.”According to the La Casa del Encuentro, an Argentine NGO focused on women’s rights, every 30 hours an Argentine woman dies as a result of gender-related violence. In Mexico, according to the National Citizen Femicide Observatory, 2,000 women die each year. In Brazil 15 women are killed each day, according to president Dilma Rousseff.In recent years, similar movements against domestic violence have arisen in countries including Turkey, Egypt and India. Rather than being coordinated by traditional organizations, these protest have been characterized by using social media as a tool for promotion and informal organization. “I’m not sure social networks give us more power, but they definitely give us more visibility,” said Comte. “They allow us to create networks between us.”By Christopher SabatiniJune 3, 2015Women hold signs that read “Argentine justice stinks” and “Justice for Nisman” during a march for justice in the case of the mysterious death of late prosecutor Alberto Nisman, Buenos Aires, Argentina, Feb. 4, 2015 (AP photo by Rodrigo Abd).Since transitioning from authoritarianism to democracy, civilian governments in Argentina, Chile, Peru and Colombia have made great strides in curtailing the autonomy of the armed forces in terms of accountability for past abuses, budgeting, promotion and operations. But in all these countries, the military and intelligence services have retained a degree of autonomy over specific missions and their operations, referred to as “reserved domains” in the Latin American democracy transition literature of the 1990s. Recent events have demonstrated how far the region still has to go in improving transparency and civilian control over the intelligence services.Argentina has been rocked by a scandal in which the Secretariat of Intelligence (SI) apparently spied on government officials and leaked documents to Special Prosecutor Alberto Nisman before his mysterious death. An espionage crisis between Peru and Chile has created political and diplomatic headaches for both elected governments. And in Colombia—which underwent its own democratic transition decades before many of its neighbors, but has still not fully resolved its long-running civil war—President Juan Manuel Santos is struggling to assert control over rogue elements, including his predecessor and former boss, that appear to be trying to undermine his government’s peace talks.In a region marked by military coups and praetorianism, these persistent cracks in civilian control over security and intelligence operations remain a serious blemish on more than three decades of electoral democracy. The politicization of the intelligence service remains a threat to political accountability and independent civilian authority over one of the state’s most important functions: the power to collect intelligence. That power, should it be exercised without civilian, objective professional control or conducted for specific partisan purposes, undermines the social trust and state accountability essential to democracy, and as the case of Chile and Peru demonstrates, it can also threaten diplomatic relations between democratic governments.Did Reforms Ever Stand a Chance?It wasn’t supposed to go this way. Latin America experts in the 1990s predicted that elected governments would be able to roll back pockets of resistance to civilian rule among the old guard. In some countries, military governments left in a rushed fashion, drummed out by their economic and political failures—what was called democracy by rupture. Such was the case in Argentina, whose government, humiliated by the defeat in the Falklands War and the huge economic mess it had struggled to contain for six years, was forced to call snap elections and abandon power in 1983. Similarly, when Peru experienced a belated transition in 2000 after the collapse of President Alberto Fujimori’s government over the corruption scandals of his intelligence chief Vladimiro Montesinos, many believed that public disgust over the pervasive abuse would bring a thorough overhaul of the country’s military and intelligence apparatus. Unfortunately, while laws and regulations were changed and organizational charts rewritten to place them under civilian authorities, truly curtailing the prerogatives of long-independent intelligence agencies and their operatives proved far more difficult.According to the democracy literature of the late 1980s and 1990s, one of the more difficult countries for rolling back military and intelligence prerogatives was supposed to be Chile. This was because Chile’s reserved domains of military and intelligence prerogatives were expected to be more durable as a result of a negotiated transition. In 1988, then-dictator Augusto Pinochet lost a referendum on his leadership, with 56 percent of Chileans voting in favor of his stepping down. As Pinochet eased himself out of power, he did so under a constitution of his own creation that included military prerogatives over recruitment, budgeting and operations—including intelligence.Over time, despite the dire predictions of academics, subsequent civilian governments in Chile chipped away at these powers. Civilian presidents curtailed the military’s control over promotion, reduced its discretion over its budget—while not ending its sweetheart deal in which it automatically gets 10 percent of the profits of the state-owned copper company CODELCO—and even began to peel back the amnesty for human rights abuses that the military conveniently established before it stepped down.Intelligence, however, has been another matter. As the recent scandal over the Chilean navy’s spying on Peru revealed, within the armed forces Chilean intelligence has maintained significant independence in its information-gathering missions.And then there’s Colombia. Under the National Front, a power-sharing agreement between the two dominant parties—the Liberals and the Conservatives—that ended the period of “La Violencia” in 1958 and lasted until 1974, the broader issue of ensuring greater transparency in the intelligence sector was never fully addressed. Later, there was no push to reform the intelligence sector, as the demands of fighting narcotrafficking and the country’s irregular armed groups—including paramilitaries and two guerrilla movements, the National Liberation Army (ELN) and the Revolutionary Armed Forces of Colombia (FARC)—took precedence. To the contrary, the fight against these groups created its own incentives for the military-intelligence complex to develop and hive itself off from the rest of the state and elected officials.For a long time, this insulation from civilians did not flare into the public sphere. The seams began to show during the failed peace efforts of President Andres Pastrana from 1998 to 2002. Hoping to jump-start a peace process to end Colombia’s three decades of civil war, Pastrana granted the FARC guerrillas a Switzerland-size chunk of the country as a safe haven. But the guerrilla forces used the “peace zone” to build up their forces and house their considerable stash of hostages—all the while dragging their feet on the peace negotiations.As it became evident that the guerrillas had no real interest in laying down their arms and ending their illicit activities, the Colombian military and intelligence services started to leak the news of the actual goings-on in the so-called demilitarized zone. The leaks revealed the legitimate failings of the peace process, but were also a challenge to the civilian president, Pastrana.In President Alvaro Uribe, Pastrana’s successor, the military and the intelligence forces found a leader much more in line with their thinking. That affinity continued even after Uribe left office, with both sides directly or indirectly colluding in trying to torpedo the peace negotiations between the government and the FARC started by Uribe’s successor, Santos.In short, the recent scandals in all four countries have brought to the public eye the lags in intelligence sector reform. Rogue agencies and agents, political sympathies among intelligence officers and missions unauthorized by civilians have rocked politics in all four countries—despite long-standing policies and promises to reform the agencies to bring them under objective civilian control.Recent Events and Gaps in the TransitionsOf course, in recent years, even the United States has had its own intelligence-related scandals—most notably when National Security Administration contractor Edward Snowden leaked documents revealing a massive online surveillance program, provoking widespread domestic and international outrage. That scandal, however, arose from an intelligence agency under civilian control and staffed by civilians operating under an expansive mandate from Congress and overseen by the executive. In Latin America, by contrast, recent scandals have been the result of intelligence or military officers either acting without civilian oversight or—in the case of Colombia—out of partisan sympathies.Argentina. In Argentina, despite a series of reforms in 1988, 1991 and 2001 intended to increase civilian oversight over SI, the Nisman case revealed that the agency had been spying on elected officials, who in theory were in charge of SI. Nisman’s investigation revolved around the Argentine government’s controversial decision to form a truth commission with the Iranian government to investigate the 1994 bombing of the Israeli-Argentine Mutual Association (AMIA) center, in which Nisman had implicated high-ranking officials in Tehran. Nisman alleged that communications between Argentine public officials covertly gathered by SI proved that the truth commission was the result of a secret deal with the Iranians to remove them from an Interpol arrest list in exchange for increasing trade between the two countries, in violation of U.N. sanctions. Those conversations were the basis of Nisman’s admittedly weak case against President Cristina Fernandez de Kirchner and Foreign Minister Hector Timerman. Most of the conversations, though, were among junior-level officials allegedly speaking on behalf of higher-ups. Two successive judges have dismissed the case since Nisman’s death.Whatever the ultimate merits of Nisman’s case—which, given the politicization of the case and the state in Argentina, may never be known—the leaking of the documents was clearly an act of betrayal and partisanship by an intelligence agency nominally under the control of an elected, civilian government. Ironically, SI was one of the last bastions of independence in the Argentine state under a government that had politicized or steamrolled every other institution, including the judicial system, the Central Bank and the national statistics office (INDEC)—the last after it dared to release inflation numbers that challenged those of the administration.Of course, unlike a judicial system, a central bank or a statistics office, the intelligence agency is supposed to be under the control of a particular administration. Unfortunately, the lack of accountability for SI has allowed the Kirchner government to avoid answering Nisman’s charge or independently and transparently investigating his death.In an op-ed in The New York Times, the former human rights and anti-corruption activist Horacio Verbitsky, now a close ally of the Argentine president, placed the blame on the failure of past efforts to reform the agency. SI was, he alleged, a rogue agency—which was true. A former high-level official in the agency, Antonio “Jaime” Stiuso, could possibly have been operating under personal or even political motives in leaking the communications, since he had been fired only a few months before Nisman’s case. But Verbitsky’s allegations only muddied the waters. While his portrait of an unaccountable intelligence agency was fair, it dodged the matters of whether the documents had any merit and who could have been behind Nisman’s death.Whether Nisman died as a result of suicide or an execution-style murder is still an open question. His widow, a judge herself, organized an independent investigation that concluded he was killed, while it looks increasingly like the judicial system may conclude it was a suicide—something that the president claimed the day after it happened. Unfortunately, debate over the reform of the intelligence sector has deflected responsibility over what should be an open, transparent and perhaps even international investigation.At the same time, given the highly politicized nature of all things in the Kirchner government, while the newly cleaned-out intelligence service may be more accountable to the civilian government, it is also likely to be partisan. After gutting the Central Bank and INDEC of their independence, there is little reason to believe that a Kirchner-reformed and renamed intelligence agency will be anything more than a partisan lackey of the government. That means any future president chosen in the elections this October—in which Kirchner is prohibited from running for a third consecutive term—will have to reform, again, the intelligence sector, along with all the other politicized, weakened state institutions Kirchner will leave behind.Chile and Peru. On the other side of Patagonia, Chile and Peru are having their own intelligence scandals. Chile and Peru have been adversaries since the 1879-1883 War of the Pacific, in which Chile briefly occupied the Peruvian capital of Lima and then, in the resulting peace treaty, assumed control of the Arica region that had previously belonged to Peru. But in recent decades, under democratic governments, both countries have made a concerted effort to cooperate and resolve differences, ranging from who could rightly brand pisco—the grappa-like, grape-based liquor claimed by both as a national drink—to their contested maritime border. In the latter case, the countries submitted the dispute to the International Court of Justice at The Hague, which, in a complicated decision, upheld Chile’s claims over the rich fishing grounds of the coast but gave additional maritime territory to Peru. Despite the Solomonic decision over the maritime rights, both sides accepted the agreement, a sign that the countries had placed bilateral relations on firmer footing.But in February, it was revealed that Chilean spies had bought information from Peruvian naval officials on Peru’s fishing operations. Despite a series of reforms starting in 1993 that reorganized Chile’s relatively small National Intelligence Agency, placing it under greater civilian control, when the scandal broke, the Chilean Foreign Ministry claimed it had no knowledge of the operation. The incident caused a temporary diplomatic flap, in which Peruvian President Ollanta Humala briefly recalled his ambassador to Chile. The Chilean government responded by saying that it did not engage in espionage, which raised an even worse possibility: that the government hadn’t authorized the spying, but state officials were doing it anyway.Meanwhile, Humala’s government was having its own problems with an unaccountable spy agency. After the Fujimori and Montesinos revelations in 2000, the National Intelligence Service (SIN) had been reformed, supposedly placed under civilian control and divided into two agencies: the System of National Intelligence (SINA) for largely military-related espionage and the National Directorate of Intelligence (DINI) for nonmilitary intelligence gathering, with the latter directly reporting to the president.But earlier this year, a press report revealed that the DINI was spying on civilian politicians, apparently neither with the approval nor at the request of the civilian government. The revelation struck a nerve in Peru, harkening back to the dark days of corruption, blackmail and murder under Fujimori.Humala quickly responded to the scandal by forcing out the head of the DINI, Ivan Kamisaki, and accepting the resignation of the national intelligence director, Javier Briceno. But questions remain about the new agency’s integrity, given that even after the full overhaul following the Montesinos years, rogue operations and the targeting of perceived political opponents continued. As for relations between Peru and Chile, those were quickly patched up, again a reflection of the important economic relationship and improved diplomatic ties between the two neighbors.Colombia. Colombia has also struggled with its own intelligence accountability issues, though of a different nature. Years of doing battle against narcotics trafficking and the guerrillas had given Colombia’s Administrative Department of Security (DAS) a broad scope for action. But it wasn’t until Uribe’s presidency that DAS began to be used as a tool against political opponents—or at least that its use against them became known. During his two terms in office, from 2002 to 2010, Uribe used DAS to monitor political opponents, human rights activists and judges who were adjudicating cases against the government.Tapes and documents obtained by Colombian media and testimony by former DAS officials laid bare DAS’ extensive use of wiretapping to monitor the activities of judges and specific investigations of links between human rights groups and the guerrillas, of which none were found. The brazen use of the intelligence agency for political purposes shocked the country and led to a 2013 reform effort to increase the nonpartisan control over DAS. But the spy agency’s independence remained.Santos, who served as Uribe’s defense minister before succeeding him as president, has embarked on peace negotiations with the FARC. But Uribe, now a senator, along with segments of the armed forces and DAS, continues to oppose the negotiations. As a result, whether in coordination or separately, the armed forces and DAS have been covertly keeping tabs on the negotiations and the negotiators and leaking those discussions. The leaks have been picked up by Uribe, who has used them to position himself as the principal voice of opposition to the peace talks. Oddly, while Santos has railed against the leaks and rooted out the perpetrators, Uribe and others in the democratic opposition have remained mute on the clear violation of presidential authority.ConclusionIn Peru, the DINI and the military’s activities have clearly represented a breach of civilian control. But what is even more troubling is the situation in Colombia, where a former elected president is echoing and using DAS’ intelligence to undermine the current administration’s policies, thereby embracing their clearly anti-democratic behavior. In Colombia, as in Argentina and arguably the U.S., it is civilian politicians who allow or even abet the autonomy and anti-democratic acts of intelligence agencies.All of this should call into question the gospel of the 1990s democratic transition and consolidation literature. The conflict is not just between civilian governments and the prerogatives and structural pockets of autonomy that remain from an anti-democratic military, as many predicted in Chile. The larger issue today, as seen in Fujimori’s Peru, Uribe’s Colombia and Kirchner’s Argentina, is civilian elected officials who politicize intelligence agencies, and the institutional legacies they leave behind.Unfortunately, in the politicized environment in Argentina and Colombia, it is difficult to imagine a broad consensus over the reform of intelligence services. In Argentina, the government has consistently reacted with vitriol and smear tactics against anyone who has questioned the Nisman case, including judicial officials and the Jewish community—hardly a propitious environment for an objective, much-needed overhaul of the intelligence sector. The remaining hope is that after the October elections, a new president will yet again attempt a top-to-bottom reform that de-politicizes the SI and places it under the control of civilian officials.In Colombia, Uribe has been all too happy to use and relay the information gleaned by the unaccountable segments of the Colombian armed forces and DAS—despite the fact that such insubordination under his administration would surely have met with a sharp, quick response. Given the difficulties and controversies of securing a peace, renegade elements of the armed forces and intelligence sector will likely continue to try to undermine the negotiations.In Chile, given President Michelle Bachelet’s low levels of public approval and the series of scandals rocking her government, her family and the opposition, intelligence sector reform is not high on the agenda. Admittedly, however, the scale of Chile’s spying scandal is of a lesser order than the others, and congressional oversight could resolve it.The greater challenge is to Chile’s north, in Peru. The legacy of a corrupt, politicized and independent intelligence service remains, even after the wrenching changes following the Fujimori-Montesinos years. With the former president’s daughter, Keiko Fujimori, leading in the polls for the country’s 2016 presidential election, the specter of a repeat of those gruesome corrupt years has raised its head. Humala would be well-advised to shore up civilian control and vest it with nonpartisan oversight before he leaves office.Ultimately, elected governments cannot be said to govern if they don’t have direct oversight and control over a nonpartisan, objective intelligence service. While reforms in decentralization, central banks, a more professional public sector and judicial systems have proceeded across the region, the intelligence services remain an isolated, independent lot—and that remains a serious threat to social trust and an accountable state.Christopher Sabatini is the founder and editor of the new policy website Latin America Goes Global and an adjunct professor at Columbia University’s School of International and Public Affairs (SIPA).
THURSDAY, JUNE 4TH
By Kejal Vyas2 June 2015Officials probe whether someone logged onto prosecutor Alberto Nisman’s computer after his mysterious deathArgentine officials said they were probing whether someone logged onto the computer of prosecutor Alberto Nisman hours after his mysterious death in his apartment but before his mother discovered his body.The new development in a case that has roiled Argentina since Mr. Nisman’s death in January is being investigated by Viviana Fein, the prosecutor who is trying to determine if the 51-year-old killed himself or was the victim of foul play. Mr. Nisman’s Samsung laptop logged the input of up to three flash drives just after 8 p.m., Ms. Fein told Argentine media on Monday, some hours after a .22-caliber Bersa was held to his head and discharged.Investigators are looking into whether the computer—which contained data from his investigation of Iran’s suspected role in a 1994 terror bombing in Argentina—was accessed locally or remotely and whether its time registry could have been changed.Mr. Nisman died just hours before he was set to present evidence he said would link President Cristina Kirchner to a conspiracy to cover up Tehran’s alleged role in the 1994 bombing of a Jewish community center in the capital, Buenos Aires.“Logically, it will have to be a very exhaustive study because many times you can technically manipulate the time registry,” Ms. Fein told a local radio station.Her comments, the latest twist in a case that has engrossed Argentina, were splayed across the front pages of newspapers on Tuesday and dominated talk radio shows after La Nación newspaper reported the development over the weekend, leading to Ms. Fein’s comments.The news of her new line of inquiry comes as critics have been accusing authorities of sullying evidence during the evidence gathering process in Mr. Nisman’s residence in an affluent section of Buenos Aires.Mr. Nisman’s death on Jan. 18, when he was found on the floor of his bathroom after a bullet was fired into his head, has plunged Argentina into months of speculation.The president has denied Mr. Nisman’s accusations about an Iran connection, and her associates have said he committed suicide. Her office didn’t return phone calls and emails seeking comment on Tuesday.Discord over the investigation has centered on the time and circumstances of Mr. Nisman’s death.Officials first suggested that he committed suicide, but later indicated that he may have been assassinated, without offering conclusive proof of either scenario. Ms. Fein’s office says evidence indicates Mr. Nisman likely died around noon on Jan. 18. But a rival investigation spearheaded by Mr. Nisman’s former longtime partner, Judge Sandra Arroyo Salgado, says he may have died on the previous night. Ms. Salgado couldn’t be reached for comment.In a related development, an Argentine television program called “Journalism for All” aired on Sunday part of a four-hour video that showed police investigators appearing to mishandle evidence at the scene. Mr. Nisman’s mother, Sara Garfunkel, is seen in the video as several officers gather fingerprints and examine documents without using gloves in the early hours of Jan. 19. At one point, someone uses toilet paper to wipe blood from the handgun found with Mr. Nisman’s body, smearing blood on the adjacent bidet while removing bullets from the firearm.Ms. Fein, who also appears in the video,, who couldn’t be reached for further comment, said there was no mishandling.“The scene was not contaminated. It was duly preserved,” she told Argentine media, adding that only a part of the blood-smeared gun was cleaned so its serial number could be read.Ms. Fein’s comments are unlikely to quash speculation in Argentina, where polls have shown that most citizens believe Mr. Nisman was murdered.A new book by Mr. Nisman’s cousin, Andrea Garfunkel, launched fresh accusations that the late prosecutor was killed because of his investigation into the 1994 bombing. Ms. Garfunkel highlights irregularities regarding the findings at Mr. Nisman’s home. She notes the unused pajamas found near his bed, which she says suggests he may have died the night before investigators found him.By Jorge OtaolaJune 2, 2015Argentina’s official peso weakened 0.06 percent to an all-time low of nine per U.S. dollar on Tuesday, as the government continued its policy of allowing the local currency to slowly depreciate.The official exchange rate in the grains-exporting country is controlled by the central bank. The currency has weakened 5.0 percent so far this year after a 23.8 percent fall in 2014.Argentina has established tough currency and trade controls to keep U.S. dollars in the country, while many average Argentines seek the greenback as a safe-haven against inflation clocked by local economists at 25 percent per year.Central bank chief Alejandro Vanoli said in public remarks on Tuesday that he hoped investors would “come back to trust the peso”.The black-market peso ended Tuesday 0.16 percent weaker at 12.6 per dollar.By Pablo Rosendo GonzalezJune 2, 2015Julio Grondona, a former FIFA vice president and head of finance who ran Argentina’s soccer federation from 1979 until his death last year at 82, will have his assets and estate included in an investigation for possible tax evasion.Argentina has asked the U.S. for additional information about three citizens named last week by U.S. Justice Department officials charged with racketeering, wire fraud and money laundering who had dealings with Grondona, referred to as “co-conspirator #10” in the indictment. The tax agency, known as AFIP and headed by Ricardo Echegaray, is seeking to collect back taxes for illegal payments.“We’re going to investigate whichever families or partners we need to, people who have participated in irregular actions,” Echegaray said at a press conference Tuesday in Buenos Aires. “The public prosecutor is already working on this.”FIFA, the global soccer body, on Monday blamed a dead official for authorizing a $10 million payment that prosecutors have characterized as a bribe to vote for South Africa as host country for the 2010 World Cup. Delia Fischer, a spokeswoman for FIFA, said that the payment was authorized by then head of the finance committee, who she didn’t name. Grondona was in charge of the finance committee at the time of the payment in 2008.The Argentine Soccer Association AFA said Tuesday in a press release that it wasn’t involved in any investigation, without referring to Grondona.Grondona is survived by three children. His sons, Julio and Humberto, didn’t reply to telephone calls seeking comment. Humberto was quoted by the Buenos Aires-based newspaper La Nacion this week as saying his father was “a stand-up guy,” and that “dead people shouldn’t be disturbed.”‘Shall Pass’An influential figure in soccer for decades, Grondona was appointed in 1979 as head of the sport in Argentina. As a member of Zurich-based FIFA’s governing executive committee since 1988, Grondona was involved in decisions including the selection of World Cup host nations. The most recent choices, Russia for 2018 and Qatar in 2022, are also being investigated by the U.S. Justice Department amid allegations of corruption.Grondona was known for wearing a ring that said “This too shall pass.”Echegaray said last week that he asked FIFA President Sepp Blatter to implement rules to make player transfers more transparent in a bid to correctly tax the million-dollar transfer fees paid to young soccer stars from Argentina.“This probe is the tip of the iceberg of the corruption that is generally practiced in worldwide soccer associations,” Santiago Montoya, a former Argentine tax agency chief who currently advises leading presidential candidate Daniel Scioli, said in a telephone interview. “It will expand to the money laundering associated to the billions of dollars being paid in player transfers in an obscure market governed by FIFA.”Nicolas Leoz, 86, the former head of the South American Football Confederation, who is wanted by U.S. authorities, is currently under house arrest in Asuncion, Paraguay.By Camila RussoJune 2, 2015Argentina’s Buenos Aires province issued international bonds for the first time since 2011 as borrowing costs plunge.Argentina’s largest province sold $500 million of 9.95 percent notes due in 2021 to yield 10.23 percent. It also said in an e-mailed statement that it’s seeking to swap holders of as much as $500 million of its 2015 bonds into the new 2021 securities. The 2015 notes have $1.05 billion outstanding. The deadline to accept the offer is June 8.Yields on Buenos Aires province’s $750 million of five-year bonds have plunged 2.1 percentage points in the past year to 10.5 percent as Governor Daniel Scioli, who is a presidential candidate for the ruling party, erased the province’s fiscal deficit by raising taxes. The bonds have also outperformed the national government’s debt as they remain shielded from a legal dispute with holdout creditors.“It’s a good deal,” Diego Ferro, co-chief investment officer at Greylock Capital Management, said in an e-mailed response to questions. “Provincial debt remains some of the best fixed-income investments in Argentina” because it comes with the security of being covered by New York law, he said.The notes have an expected rating of Caa2 by Moody’s Investors Service.2 Jun2015Government-imposed natural gas curtailments in Argentina saw Dow reduce its steam cracker run rates to 90% this week, a source with knowledge of the company’s operations said Tuesday.Dow “began following processing restrictions [imposed] by the authorities that manage the country’s energy,” the source said.Every winter since 2006, the Argentinian government has curtailed ethane and LPG supplies to industrial users by up to 30%, and the start of this winter’s cuts kicked in over the weekend.Dow Argentina operates two ethane-fed steam crackers and polyethylene production at its Bahia Blanca petrochemical complex. Ethane is a natural gas liquid used in the production of ethylene, which can then be transformed into polyethylene.Dow’s Bahia Blanca site has an ethylene production capacity estimated at 765,000 mt/year, according to Platts Analytics data. Petrochemical producers in Argentina see feedstock supply curtailments during the winter months, when heating and other residential use tends to be at its highest, the source said.The reduced run rate was not due to any ethane shortages from Mega, Dow’s main feedstock supplier, or any issues at the joint venture’s plants, the source said.The restrictions began to diminish considerably thanks to imports of gas and new gas supplies, both conventional and unconventional, the source said.“We hope that similar to 2014, fewer restrictions will happen this year,” the source said.Dow Argentina has been looking to North America for ethylene prior to the reduction in run rates, market sources say.By Belén MartyJune 2, 2015Was it mere coincidence that half of those present in the apartment of Argentinean prosecutor Alberto Nisman the day his body was found weren’t wearing gloves? Was it simple negligence when a forensics officer cleaned the blood-soaked pistol found next to his body with toilet paper from the bathroom?This is what journalists on the Periodismo Para Todos (PPT; Journalism for everyone) TV show asked the Argentinean public on Sunday, May 31, when they aired a video filmed by federal police in the apartment where Nisman lived just hours after his death.Alberto Nisman was found dead in his bathroom in January 2015, just days after accusing President Cristina Kirchner of covering up Iran’s alleged role in the 1994 bombing of the AMIA Jewish center in Buenos Aires.The four-hour video, according to the PPT journalists, shows how investigators arrived on the scene at 2 a.m. on Monday, January 19, and proceeded to commit multiple serious breaches of forensic investigation procedure.To begin with, explains PPT presenter Jorge Lanata, the number of people present in the apartment was like “Tokyo at two in the afternoon.”Police proceeded to handle objects within the prosecutor’s strongbox without latex gloves, which they also neglected to wear when taking fingerprints from one of the doors. Moreover, the video shows that forensic investigators failed to take several items for analysis, including clearly visible samples of hair.One of the most contentious mistakes centers around the pistol that was apparently used to kill Nisman.The investigator who picks up the weapon decides to clean it with toilet paper — from the very bathroom where Nisman’s body is lying — so the person filming can record its model and serial number.Also calling the attention of the PPT analysts was the fact that the video featured cuts and clear signs of editing. Normally, they explained, these kind of videos should be filmed without any subsequent alteration.In another blunder, overseeing prosecutor Viviana Fein can be seen to tread on the blood in the bathroom.State Security Secretary Sergio Berni, one of the first to arrive at the presumed crime scene, asks the prosecutor – some time after she has arrived – if she can verify whether Nisman is dying.Fein subsequently defended the procedure, saying that “the examination by the forensic medical corps was excellent.” She added that investigating officers carried out all appropriate tests.With regard to the use of toilet paper on what may have been a murder weapon, the prosecutor told FM radio station Vorterix that “the police officer didn’t pass the toilet paper over the whole weapon, only where he knew the caliber and numbering were.”The Iranian ConnectionIn another segment of the program, Lenata explores the alleged connection between Iran, Venezuela, Argentina, and Nisman, suggesting that the nuclear program of former Iranian President Mahmoud Ahamadinejad involved the collaboration of Kirchner and Venezuela’s Hugo Chávez.“The Nisman issue hides something much more important, which is a parallel relationship between Argentina and Iran, with regard to the nuclear issue,” Lenata argues.Security analyst Douglas Farah meanwhile told the show that Washington’s perspective is that Nisman “wouldn’t be dead were it not for his investigation.”PPT journalist Mariel Fitzpatrick adds that “all of the sources that we consulted in the United States confirmed that the true motive of Iranian influence in the region wasn’t to boost trade, but to develop its nuclear program.” According to the program, Nisman had uncovered key evidence about Tehran’s clandestine objectives.Joseph Humire, a former US marine and executive director of the Center for a Free Security, similarly told PPT that Nisman possessed ample information about how fundamentalist terrorism operates in Latin America.“There was an alliance with the terrorists. The executive made an alliance with the terrorists,” Nisman told an Argentinean television program days before he died.For Humire, Nisman understood the Iranian connection better than any Latin-American official, and raised the alarm with the United States and his regional colleagues. “He had evidence of how Iran was operating and its growing presence in the region,” Humire argued.The analyst suggested that Ahmadinejad made a special request of Chávez, to broker access to Argentina’s nuclear power technology. Argentina developed a vigorous nuclear program during the 1970s and 80s, a program which tailed off at the end of the century.According to this theory, Iran used Venezuela as an entry point to Latin America as a means of going under the radar of stringent international sanctions, designed to prevent Tehran from acquiring nuclear weapons materiel.As Argentina returned to developing its nuclear program anew in 2009 and 2010, Humire adds, Iran began to woo Buenos Aires once more. Iran thus began to funnel money to Argentina via Venezuela.“The failure of laws and institutions in Argentina and its corrupt politics allowed Iran to operate with impunity in the country,” Humire concluded.
WEDNESDAY, JUNE 3RD..
8. REAL RETAIL SALES DROP IN APRIL AS ARGENTINE PUBLIC DEFICIT INCREASES, GOVERNMENT RESORTS TO DEBT TO CONTINUE SPENDING (IHS Global Insight Daily Analysis)10. THE HEDGE FUND MANAGER SUING ARGENTINA JUST HAD HIS ‘THAT’S IT!’ MOMENT (Business Insider Online)June 1, 2015BUENOS AIRES, Argentina — Argentina’s government is again rejecting negotiations with a group of hedge funds that hold some of the government’s bonds, arguing that the U.S.-led group has created a tense environment by harassing the South American nation.In a letter dated Monday, the law firm representing Argentina in the United States said Argentina also lacks confidence in appointed mediator Daniel Pollack.The dispute has its roots in Argentina’s $100 billion default in 2001. Most creditors renegotiated the debt in 2005 and 2010 bond swaps. But a group of creditors refused and took Argentina to court in New York.Judge Thomas Griesa has repeatedly ruled that Argentina can’t make payments on its debt without paying the holdout funds. Argentina rejects that, and the holdout funds have tried to seize Argentine assets overseas.By Almudena CalatravaJune 1, 2015BUENOS AIRES, Argentina — The lead investigator in the mysterious death of a prosecutor who had accused Argentina’s president of wrongdoing came under sharp criticism Monday for a video showing police working without latex gloves where Alberto Nisman’s body was found.Ernesto Duronto, vice president of Argentina’s association of forensic experts, said many irregularities are seen in the video, which was shot by federal police and obtained by Canal 13.The video “shows how things should not be done,” Duronto said, saying it was paramount for forensic investigators to preserve the cleanliness of a crime scene.Lead prosecutor Viviana Fein defended her investigation. She acknowledged what the video captured but said it had no impact on the case.“The crime scene was not contaminated. It was diligently preserved,” Fein told Vorterix radio station.In the video, an officer is seen removing articles from Nisman’s safe without gloves. Officers are also seen picking up Nisman’s cellphone without gloves and cleaning the gun found at the scene with toilet paper.Fein said police cleaned only part of the pistol to read the serial number and that would not have eliminated a criminal’s fingerprints. Duronto disagreed, saying such an action could indeed smudge prints.Nisman was found dead in a pool of blood in his apartment Jan. 18. The next day, he was scheduled to elaborate to Congress on his allegations that President Cristina Fernandez had orchestrated a secret deal to cover up the alleged role of Iranian officials in the deadly 1994 car bombing of a Jewish community center in Buenos Aires.Fernandez rejected the allegations and a federal judge threw out the case in February.More than four months since Nisman’s death, no suspects have been arrested and Fein has said authorities are not sure whether Nisman was killed or committed suicide.June 1, 2015BUENOS AIRES, Argentina — A judge in Argentina has resigned amid sharp criticism for reducing the sentence of a convicted child abuser because the 6-year-old victim supposedly showed signs of being gay.The Criminal Appeals Court of Buenos Aires confirmed to The Associated Press on Monday that judge Horacio Piombo stepped down. No reason was given.In a 2014 ruling that recently came to light, Piombo and fellow Judge Benjamin Sal Llargues cut the sentence of sports club executive Mario Tolosa from six years to 38 months.They ruled that his acts should not be considered “gravely outrageous” in legal terms because the boy already “was making a precocious choice” of his sexuality, an apparent reference to homosexuality.The decision was roundly criticized, and many people in Argentina called for the judges to resign.By Dan BoglerJune 2, 2015Bonds outperform as country hopes leader’s exit will herald policy improvement.The country has defaulted on its bonds, the economy is in a mess, inflation is rampant, the peso keeps depreciating…and yet. Since last autumn a sense of optimism has been building with regards to Argentina, for so long a Latin American basket case. That has caused its bonds — and for much of the period, its stocks — to outperform those of regional peers (see chart) and a majority of the EM world.That the economy and the peso have stabilised lately, with inflation down to a mere 29 per cent from more than 40 per cent last year, has undoubtedly helped. But the most important factor has been politics: this October’s elections will mark the end of President Cristina Fernández de Kirchner and, in the view of the markets, anyone else will be better.Her policies, euphemistically described as “heterodox”, have run the gamut from faking economic statistics to imposing capital controls and extorting private assets (just ask Spain’s Repsol); and they are, in large part, responsible for turning what was once Latin America’s wealthiest nation into one of its neediest.No wonder investors cannot wait to get shot of CFK and are driving up Argentine assets in anticipation.The rally was at its strongest between last September and this April as Mauricio Macri, the most market-friendly of the three serious presidential candidates, rose in the opinion polls.Macri’s economic team has told Medley Global Advisors, a macro research service owned by the FT, that it intends to start with a bang if elected: it would immediately lift capital controls and exchange rate restrictions, engineer a big devaluation of the peso to restore export competitiveness and aim to strike a quick deal with the bond holdouts in order to regain access to international capital markets.It would also eliminate a whole range of tariffs and red tape that have been holding back private business while raising energy and transport prices to realistic levels in order to stimulate investment.Yes, there would be some wobbles and probably a rise in inflation. But growing confidence in a sensible government with conventional policies could trigger sufficient capital inflows to see Argentina through to stability.Appealing as all this sounds, the latest polls show that Mr Macri has a real fight on his hands with Daniel Scioli, the ruling party candidate. While Mr Scioli is not CFK’s personal choice — he is a conventional Peronist rather than a CFK loyalist — there is no doubt he will be under her influence to some degree.And there is little doubt she will do what she can to rule from behind the scenes after formally stepping down. This means that while Mr Scioli and his camp are also planning a shift back to rational economics, this would happen more gradually than under Macri.With both men polling around 35 per cent of the vote, the key will be what happens to Sergio Massa, the third main candidate, whose star has been fading rapidly. His numbers are down to less than 15 per cent and, if he does badly in the August primaries, his supporters will defect in droves. What is not clear is whether they will break more for Mr Massa or Mr Scioli or split evenly. While either man would be an improvement, the risk of an “establishment” victory for Mr Scioli is no longer priced into Argentine assets.By Charlie Devereux and Dominic CareyJune 1, 2015The country’s budget balance swung into a big deficit in March, from a modest surplus only a year earlier.One gets a strange sense of deja vu looking at Argentina accumulate debt even faster than in 2001, the year of its infamous default.The government announced last week that the primary deficit, which excludes debt payments, jumped to 17.4 billion pesos ($1.93 billion) in March, compared with a 3.6 billion peso surplus just one year earlier. The last time Argentina posted a shortfall for March was in 2002, three months after reneging on a record $95 billion of debt.Instead of reining it in, President Cristina Fernandez de Kirchner is splurging during a protracted recession in an election year. After serving two terms, the constitution however doesn’t allow her to run a third consecutive time.Few people disagree that she leaves Argentina in better shape than when deceased husband Nestor inherited a shattered economy in the wake of the largest default in financial history.Argentina’s debt today is about 27 percent of gross domestic product — a third of Britain’s level — according to Miguel Bein, chief economic adviser to Daniel Scioli, the governor of Buenos Aires province and a leading presidential candidate from Fernandez’s alliance.The problem is that fiscal spending is climbing just as a decade-long commodity boom is ending. That strips the government of revenue from agricultural exports that had fed a surplus through 2011. At the same time, the government’s ability to sell debt in capital markets is impaired by a 10-year-long legal battle with investors who refused to accept the terms of bond restructuring.“It’s unsustainable for revenue to be growing at 20 percentage points slower than spending,” saidBelen Olaiz, an economist at Abeceb.com, an economic research firm in Buenos Aires. “It’s a gap that you’re going to have to close at some stage.”That task awaits the next dweller of the Casa Rosada, the Pink House that for 12 years has had a Kirchner in residence.By Eliana Raszewski and Sarah MarshJune 1, 2015All three of the leading candidates in Argentina’s election race plan to dismantle outgoing President Cristina Fernandez’s web of currency and trade controls and clean up government finances to boost the stagnating economy.Fernandez has ramped up state intervention in the economy during her eight years in power, trying to shore up thinning currency reserves while financing generous subsidies and welfare programs.The economy grew quickly in the first years of her presidency but it is now teetering on the brink of recession. The currency has slumped on the black market and inflation is running at about 25 percent, according to private estimates.Economic advisers to the main candidates in the October election told Reuters they plan to liberalize the dollar exchange rate, cut taxes on lucrative grains exports, and move to plug a fiscal deficit and tame inflation.The consensus on the need for policy changes could further encourage investors who have driven a rally in Argentina’s bond and equity markets this year and renewed interest from hedge funds in the country.The campaign teams differ, however, on the pace and depth of reform.Mauricio Macri, the pro-business opposition mayor of Buenos Aires who is running a close second place in polls, promises swift changes to win back investor confidence.Daniel Scioli, the frontrunner for the leftist ruling party’s ticket, is more cautious as he targets votes from the Fernandez faithful as well as swing voters opposed to her policies.And third-placed Sergio Massa, who broke ranks with the president two years ago, pitches himself in the middle.On currency controls, Miguel Bein, an economic advisor to Scioli, said the first priority will be to ensure that dollars are available to importers as well as foreign companies who have been unable to repatriate profits.“I would not normalize [the currency market] in a year, but perhaps in two or three,” Bein said.While Scioli talks of “gradualismo”, or gradual change, Macri plans faster, more far-reaching reforms and says he would start to lift currency controls on his first day in office.“We would normalize flows immediately,” said Federico Sturzenegger, a Macri advisor who gained repute turning around the previously loss-making Bank of Buenos Aires.Scioli and Massa both warn a hasty removal of controls would lead to a hemorrhaging of dollars and a spike in inflation that would hit the poor hardest.Macro’s camp disagrees. “You won’t need to protect the reserves. Everyone will sell their dollars if they believe the next president’s economic program is credible,” Sturzenegger said.Sturzenegger says inflation can be hauled down to 0-4 percent in three years. Bein says single figures are achievable by the end of a first Scioli term.SLOW TRANSITION?The next president will also face a sharply widening fiscal deficit, but the candidates have said they would leave untouched politically sensitive welfare benefits which have ballooned under Fernandez.Macri and Massa say they’ll assess the cost of Argentina’s bloated subsidies, in particular on energy and transport, while Scioli has warned against austerity.“If there is one thing Argentina doesn’t need it is spending cuts,” Scioli told reporters last week.Heavy subsidies for utilities mean the monthly power bill for a one bedroom apartment is typically about 60 pesos (about $6.70), less than the price of a pizza. A one-way commuter train ticket in Buenos Aires costs just 2 pesos.“There has been a squandering of public money … on subsidies and overpriced public works that has to end,” said Aledo Pignanelli, former central bank president and an advisor to Massa.Massa says he offers more change than Scioli but without a return to the “neo-liberalism” of the 1990s – and its rash of disastrous privatizations – that he says Macri represents.Critical to taming inflation and ensuring that dollars are readily available will be regaining access to global capital markets at affordable prices.That will require a deal with “holdout” hedge funds suing Argentina over unpaid debt left over from its 2002 default.Central bank foreign currency reserves sit at $33.25 billion. If Argentina does not reach an agreement with the holdouts, it would be more difficult to unwind currency controls without risking a balance of payments crisis.It is, however, not clear what a deal would look like or whether Argentina’s Congress would approve it as the holdouts have been widely denigrated as “vultures” in Argentina.Argentine bond prices this year have pointed to growing investor confidence in a resolution to the saga.Prices for the non-performing over-the-counter 2038 dollar Par bond have risen to $59.40 from $51.25 on Dec. 30, while on the defaulted 2033 dollar Discount bond , prices have risen to $99.50 from $89.00.The benchmark Merval stock index is up 26 percent so far this year.Europe-based Brevan Howard and Wall Street’s Bienville Capital Management are among those funds that have recently launched Argentina portfolios, betting on an upturn.“There are a number of key adjustments that we believe any future president would make,” said Bienville’s president, Cullen Thompson.Some analysts, however, voice caution over the likely pace of policy changes and a settlement with debt holdouts.“Whereas we share the optimism regarding the eventual implementation of some policy corrections, in our view the transition could be lengthier … than currently envisaged by the market,” said Mauro Roca at Goldman Sachs.By Richard LoughJune 1, 2015Argentina will not negotiate with the U.S. hedge funds suing over unpaid debt for as long as the investment firms continue harassing the country, lawyers acting on behalf of the Argentine government said on Monday.The letter from law firm Cleary Gottlieb Steen & Hamilton LLP to the mediator presiding over the stalled talks comes three days after a U.S. judge urged all parties to get back to the negotiation tables.The funds “have increased their unwarranted attacks on the Republic, both in and out of court,” the latter stated. “They have sought orders freezing immune diplomatic assets … and sought to thwart clearly legitimate domestic debt issuances.”“The Republic has informed us that, after careful consideration, it has concluded that engagement is not possible at this time.”There have been no publicly acknowledged direct talks between Argentina’s powerful economy minister Axel Kicillof and the funds since July 31, when Argentina tipped back into default after failing to reach a settlement with the creditors.The lengthy debt battle stems from Argentina’s record default on $100 billion in 2002, after which almost 93 percent of creditors accepted sharp writedowns on their debt holdings.However, a small group did not, including Elliott Management’s affiliate, NML Capital Ltd, and Aurelius Capital Management, which are spearheading the legal fight in a New York City court.They are claiming repayment of 100 cents on the dollar, an amount President Cristina Fernandez calls extortion.Investors on Wall Street and in European capitals have lost hope of a deal before Argentina’s presidential election on October 25. Fernandez cannot run for a third term.While the three front-running candidates acknowledge Argentina’s need to shake off its reputation as a pariah of global debt markets, none have given a detailed view on what a deal with the so-called holdouts might look like.Locally the funds are widely denigrated as “vultures”.Argentina has accused mediator, or special master, Daniel Pollack of bias in favor of the investment firms.“Nor does the Republic believe that engagement will occur under the current Special Master framework,” Cleary Gottlieb’s letter said.U.S. District Judge Thomas Griesa, who appointed Pollack, has shown no sign of replacing the mediator.8. REAL RETAIL SALES DROP IN APRIL AS ARGENTINE PUBLIC DEFICIT INCREASES, GOVERNMENT RESORTS TO DEBT TO CONTINUE SPENDING (IHS Global Insight Daily Analysis)By Paula Diosquez-Rice, Mario Guillen1 June 2015In yearly terms, however, supermarket and shopping centre sales grew by 7.3% and 3.9%, respectively, in real terms in April.According to Argentina’s National Statistical Office (Instituto Nacional de Estadística y Censos: INDEC), real sales in supermarkets decreased 3.8% month on month (m/m) for April, while shopping centres reported a drop in sales of 12.0% m/m.In supermarkets, the categories of food and beverages posted the highest increase in nominal terms, up by 11.9% m/m, while cleaning and perfumery articles rose 10.8%, followed by the electronics and household appliances category, up by 9.8% m/m.As for shopping centres, the clothing, footwear, and leather category rose by 36.9% m/m in current prices, therefore not accounting for inflation. This was followed by the category of books and stationery, up by 26.3%, while the leisure and entertainment category fell by 26.0% m/m.Although yearly figures showed an expansion in sales, the effects of last year’s currency devaluation on consumption in the following months point to levels that should be much higher in a recovering economy, especially considering the downward trend in real monthly figures.As the population struggles to keep up with the rampant rise of prices in Argentina, consumption is likely to fall despite salary increases, making social discontent more likely.Argentina’s economy relies on public spending to drive growth, but since commodity prices have fallen, the unsustainability of its economic model is reflected in dangerously high levels of public deficit, which are unlikely to be reduced in the short term.By Fabiana Frayssinet1 June 2015BUENOS AIRES, May 30, 2015 (IPS/GIN) – The death of two Bolivian boys in a fire and the mistreatment and sexual abuse of a young Bolivian woman put the problem of slave-like labour conditions in clandestine sweatshops back in the headlines in Argentina.The state, the textile and fashion industries, and consumers mutually blame each other for the problem.The two brothers aged seven and 10 died on Apr. 27 in a fire in one of the numerous clandestine garment workshops in Flores, a Buenos Aires neighbourhood, where their parents, immigrants from Bolivia, were living and working.A few days earlier, Rosa Payro, a 21-year-old from Bolivia, was rescued from another sweatshop on the outskirts of Buenos Aries after nearly three years of being raped, beaten, tortured and held captive by distant relatives she was working for.These two cases reflect a complex situation, Juan Vásquez, a former sweatshop worker who now forms part of Simbiosis Cultural, a collective of Bolivian immigrants seeking to draw attention to the appalling conditions in the clandestine workshops, told IPS.“When people talk about slave labour, they think of it as a ‘Bolivian’ thing and they don’t associate it with consumerism, with local working class people, with the connivance of the national and city governments,” said Vásquez. “We are merely the leftovers, the excluded, the exiled.”According to the Alameda Foundation, there are some 3,000 sweatshops in and around Buenos Aires alone, with an average of 10 employees each. The majority of the roughly 30,000 workers are from Bolivia, South America’s poorest country. But there are also Peruvians, as well as workers from other Argentine provinces.“They live in the same place where they are exploited, and they work over 16 hours a day,” said Lucas Schaerer, spokesman for the Alameda Foundation, which fights slave and child labour and the trafficking of persons for sexual exploitation. “They are completely under the control of their boss.”He told IPS that “they’re forced to pay taxes, they eat in the same place they work, in inhumane conditions. Their meals, discounted from their wages, are skimpy, which is why they have a high incidence of tuberculosis. They live in concentration camp-style dormitories with bunkbeds and bathrooms shared by 30, 50, 60 people.”In Argentina, a country of 41 million people, including 1.8 million foreign nationals, the law on immigration guarantees the right to work, education and healthcare for South American immigrants. But many of these modern-day slaves are undocumented. And according to estimates by non-governmental organisations, 90 percent of them work in agriculture or the textile industry.“They often traffic them without documents or identification,” said Schaerer, referring to the sweatshop owners, who are sometimes relatives or acquaintances of the trafficking victims.“Many don’t want to try to legalise their status because they think they’ll be deported,” Alfredo Ayala, the president of the Asociación Civil Federativa Boliviana, told IPS.Schaerer said that the sweatshops are the last link in the garment industry chain, and that nearly 80 percent of the industry depends on them.“It’s all part of a big scheme: people are trafficked, reduced to slavery conditions, and forced to work making clothes” for big and small brand names, street fairs, famous designers, fashion boutiques, counterfeit clothing markets, and even government departments, he said.He cited a 2006 internal audit by the Defence Ministry, which found that the army procured supplies from clandestine workshops.“Many different parties share responsibility for this criminal activity,” where national and municipal laws are violated, Schaerer said. “A large number of immigrants come into the country illegally in buses. They enter from Bolivia (over the northern border), and ride across nearly half of Argentina without running into any kind of controls,” he added.He also said the racket is closely linked to drug trafficking, which uses the sweatshops to launder money.Schaerer said the national government was responsible for failing to codify the Law on the Prevention and Punishment of Trafficking in Persons, and the Buenos Aires city government for failing to monitor and carry out inspections, and for protecting the clothing brands that have been denounced.Ayala complained that members of the police “guarantee that the sweatshops will be safe from problems in exchange for bribes.”One example was the workshop where the two boys died. Despite the police guard after the first fire, it was set ablaze on May 7, in an apparently intentional fire aimed at eliminating documents and evidence.Buenos Aires Mayor Mauricio Macri blamed the sweatshop problem on the lack of jobs, “combined with illegal immigration,” and said the factories often do not let the city inspectors in.In 10 years, the Alameda Foundation received some 5,000 complaints of slave and child labour, mistreatment and sexual abuse, as in the case of Payro.But although 110 national and international brands – some of them famous – have been named in legal proceedings for allegedly buying from sweatshops, only one was found guilty.“It’s a complex system…that is necessarily nourished by immigration” – in other words, a segment of the population without a social safety network or money, said Vásquez.“When you come here you’re very vulnerable because you don’t know the place…they tell you ‘this is where you’ll work, and we’ll bring your meals,’ and you start to just accept the situation as normal. You don’t question anything because they’re giving you a solution after things were really hard back in your own country,” he said.He was nine years old when he came to Argentina with his brother and his mother, who pawned their house to find a job. “The idea was to come here and not go back, because we didn’t have money. My last memory of Bolivia is being hungry. I remember her desperation to find some money,” he said.After a complicated border crossing, they made it to the small factory where his father worked. For three months the family shared a single bunk.These hardships were compounded by discrimination. At school Vásquez was teased and bullied for his accent and dark skin.At the age of 16, he started to work in a sweatshop, and his parents opened their own.“It’s all just seen as normal, and it doesn’t have to do with cultural characteristics,” he said. “When my mom opened up her workshop she didn’t think: now I’m going to exploit people and make money off of them. She had learned how the system worked. She saw working 16 hours, in those conditions, as something normal.“It’s capitalism overlapping with the issue of immigration,” Vásquez said.“My fellow Bolivians are often unfamiliar with the laws, and break them,” Ayala said. “They don’t know for example that what they’re doing is trafficking in persons. Sometimes they bring over a relative, thinking they’re doing them a favour, without knowing that they’re committing a crime.”The Alameda Foundation proposes alternatives like textile cooperatives in workshops that have been confiscated or recovered by the workers.They are also calling for an obligatory label to guarantee to consumers that what they’re buying was not made in a sweatshop, with slave labour. The governmental National Institute of Industrial Technology tried to adopt a voluntary label, but only one big clothing store accepted it.Ayala is asking the government “to raise awareness about the laws so people don’t keep bringing people in” and to monitor the big clothing manufacturers, “because without them slave labour wouldn’t exist.”For its part, the government encourages people to report sweatshops and cases of abuse to the special prosecutor’s office to fight human trafficking and exploitation.“We say that instead of closing the workshops, we have to open them up, in order to find the solution together with the main actor: the textile worker,” said Vásquez.10. THE HEDGE FUND MANAGER SUING ARGENTINA JUST HAD HIS ‘THAT’S IT!’ MOMENT (Business Insider Online)By Linette LopezJune 1, 2015Paul Singer has had it.The billionaire investor leading a group of hedge fund managers suing Argentina over a decade-old debt has finally filed to add the claims of over 500 more creditors on top of his original lawsuit.Consider this Singer’s “That’s it!” moment.Here’s why:Argentina technically defaulted last summer after ignoring a US judge’s ruling to pay Singer and his cohorts (known collectively as NML) over $1.7 billion in sovereign debt dating from its last default.One of the excuses Argentina used to explain its recalcitrance was that if it paid NML it would be opening itself up to claims from hundreds more investors because of something called the RUFO clause.If RUFO kicked in, instead of being on the hook for $1.7 billion, Argentina would be on the hook for around $5.3 billion, according to its own law. That’s quite a price tag for a country whose central bank is usually holding under $30 billion in cash. Most observers were skeptical about this reasoning but, hey, Argentina stood by it.The thing is, RUFO expired in January.And since that expiration, Argentina has made absolutely no move toward payment. The country tried to circumvent the most painful consequence of its (technical) default by trying to sell bonds through a bunch of Wall Street banks. The first time it didn’t work at all, and then a second time it sort of worked through Deutsche Bank (NML is still arguing about that sale in Court).Through all of this, negotiations with NML haven’t been going well. Actually, they haven’t been going at all.“If Argentina is not negotiating, these plaintiffs need to have their rights confirmed,” said NML lawyer Robert Cohen in Court on Friday.On top of all that you’ve got the Argentine elections in the fall. Investors have been hoping that, no matter who wins, there would be a more pro-business, settlement-ready government in office.Unfortunately, it looks like candidates from all sides are ready to let NML wait a little for payment once they’re in office.Daniel Scioli, the chosen successor of current President Cristina Fernandez, said that he would aim to pay about 70% of what Singer and his crew want once negotiations with his office started.Even the more pro-business candidate, Mauricio Macri, said that he wouldn’t settle with holdouts right away.Naturally, this is not what Paul Singer wants to hear. So at this point, why not add a few billion dollars to Argentina’s tab. It might light a fire under them, so to speak.Who knows?Meanwhile, Argentina’s economy is in a dangerous place. It’s racking up debt at a rate unseen since its last default in 2001-02. Revenues increased in Q1 2015 compared to the same time in 2014, but expenditures and interest payments have increased by far more.As economist Claudio Loser of Centennial Group pointed out in a recent note, these calculations don’t include any payments to NML or other creditors either.“These numbers mean that during the first quarter, the overall financial deficit of the public sector increased by 206 percent from the first quarter of 2014,” Loser wrote.“If these numbers are projected for the year, Argentina would incur in an overall deficit of about 6 percent of GDP, the highest in the region after Venezuela, on the basis of a nominal increase GDP of about 30 percent. The ratio would be much higher if one believes the official numbers of inflation and of real growth.”He continued (emphasis ours):“This is a terrible situation for a country that is in dire financial circumstances. Moreover, it would be the worst fiscal performance in the last twenty years on a cash basis, even worse than 2001-03, when Argentina declared unilateral default.”In short, now is not the time for Argentina to be adding more to its tab.But here we are.