5. ARGENTINA IS STILL HELPING IRAN COVER UP ITS ROLE IN THE BOMBING OF A JEWISH COMMUNITY CENTER 21 YEARS AGO (Business Insider)6. WHY THE AMIA MASSACRE AND MYSTERIOUS DEATH OF ALBERTO NISMAN STILL HAUNT ARGENTINA (The Daily Beast)8. ARGENTINA’S INFLATION REMAINS AT HIGH LEVELS WHILE OUTLOOK PREDICTIONS SUGGEST STAGNATION IN SHORT TERM (IHS Global Insight Daily Analysis)By Almudena CalatravaJuly 19, 2015BUENOS AIRES, Argentina — Conservative Horacio Rodriguez Larreta won Sunday’s mayoral run-off election in Buenos Aires, in a closer race than his opposition party had hoped for in the capital ahead of presidential voting later this year.With 99.9 percent of ballots counted, the candidate of the business-friendly PRO Party had 51.6 percent of the votes. His rival, ECO Party candidate and former economy minister Martin Lousteau, got 48.4 percent.Rodriguez Larreta is an economist and was chief of staff for outgoing mayor and likely presidential candidate Mauricio Macri. Rodriguez Larreta won the most votes in the opening round of balloting July 5, but did not garner enough votes to avoid a run-off with Lousteau.In his victory speech, Rodriguez Larreta thanked Macri for his work as mayor and vowed to continue improving public education, health and security for Argentina’s capital city.“I’m optimistic about the future because with Mauricio (Macri) as president, Argentina will recover its path of growth and well-being for all. And that will benefit all of the citizens of Buenos Aires as well,” he said.With Buenos Aires’ 2.5 million voters accounting for nearly 8 percent of Argentina’s voting population, the capital city’s election was being closely watched for tendencies for the Aug. 9 presidential primaries and the Oct. 25 national election.Both Rodriguez Larreta and Lousteau are critical of President Cristina Fernandez’s leftist government. The candidate representing Fernandez’s Victory Front coalition, Mariano Recalde, was knocked out of the race after finishing third in the first round July 5.Rodriguez Larreta has said he hopes to help achieve change for all of Argentina after the 12-year rule of Fernandez and her late husband and predecessor as president, Nestor Kirchner.The PRO had been hoping for a stronger margin in the mayor’s contest to give a boost for Macri’s chances in the presidential race. His main rival is Buenos Aires Gov. Daniel Scioli, who has been picked by Fernandez to continue the populist policies that began with her husband’s presidency. Fernandez is barred from seeking a third consecutive term.Restoring Argentina’s sense of pride and sovereignty after the country’s worst economic crisis in 2001 has been the central goal of Fernandez and Kirchner. The presidential couple negotiated or paid off most of Argentina’s defaulted debt, nationalized the pension system, kept energy cheap through subsidies and dug deep into the treasury to redirect revenue to the poor through handouts.But many Argentines are calling for change amid frustration with one of the world’s highest inflation rates, government currency and trade controls and corruption accusations that have penetrated deep into Fernandez’s inner circle.By Jonathan GilbertJuly 17, 2015BUENOS AIRES — Argentines filled the streets outside the rebuilt headquarters of a Jewish community center here on Friday, 21 years after a van loaded with explosives was driven into the building, killing 85 people in one of the deadliest anti-Semitic attacks since World War II.The annual ceremony at the site of the 1994 bomb attack has often been emotional with victims’ relatives pleading for justice in a case still unsolved and shaped by setbacks and controversy. This year, after the mysterious death of the prosecutor who led the bombing investigation for a decade, the ceremony was especially anguished.The crowd heard speeches extolling the work of the prosecutor, Alberto Nisman, including one drafted by his elder daughter, Iara, and dedicated a lengthy applause to him.“The death of Alberto Nisman was an event so tragic for society that it made us feel the echoes of that bomb on July 18,” Ariel Cohen Sabban, a committee member of the community center, the Argentine Jewish Mutual Aid Association, told the crowd.The ceremony was held on July 17 because of the Jewish Sabbath.The anniversary reignited a debate between Mr. Nisman’s supporters and his detractors, who say his focus on Iranian suspects was misguided. Separate ceremonies were held by victims’ relatives who have been critical of Mr. Nisman.For many of the victims’ relatives, however, the truth feels more remote than ever. Mr. Nisman, 51, was found dead at his home in January, slumped in a pool of blood with a bullet in his head.“After 21 years, we have nothing; all we have is another victim,” said Sofía Guterman, a retired private tutor, 72, whose 28-year-old daughter died in the bombing, referring to Mr. Nisman. “We’ve always clung to the smallest hope that some truth would emerge. But justice here regresses; it does not move forward.”As a siren wailed at the precise moment of the bombing, the crowd held up black-and-white pictures of the dead. Handwritten posters criticized Argentina’s public institutions for what are widely perceived as moves to obstruct justice. These include alleged maneuvers to distort the investigation involving former President Carlos Menem and a judge and prosecutors previously assigned to the case. They will appear in a much-awaited trial next month.The unresolved bombing points to “ills that beset Argentine society,” said Dina Siegel Vann, Latin America director for the American Jewish Committee in New York, who was here for the anniversary. “There’s a sense of skepticism that there are no resources to address this.”Investigators have still not established whether Mr. Nisman shot himself or was murdered. He was replaced by a team of four prosecutors.Mr. Nisman had accused President Cristina Fernández de Kirchner and her foreign minister, Héctor Timerman, of conspiring to derail his investigation. Mrs. Kirchner, Mr. Nisman claimed, had ordered back-channel negotiations to shield former Iranian officials he believed had planned the 1994 attack, in return for trade benefits.The accusations, which the government refuted, died in Argentina’s courts.Mr. Nisman was found dead hours before he was due to present his findings before Argentina’s Congress. A pistol he borrowed from an assistant, used to fire the fatal bullet, was beneath his body, and a spent cartridge was at the scene.While those in the crowd largely supported Mr. Nisman and his focus on the Iranians, the anniversary emphasized fissures in the Jewish community over how the investigation should proceed.“We systematically confronted Nisman about the orientation of his investigation,” said Laura Ginsberg, 57, a university professor whose husband died in the bombing. Ms. Ginsberg, who did not attend the ceremony, is aligned with victims’ relatives who believe Mr. Nisman was coerced into focusing on Iran.While many people hope that the impending trial involving former President Menem could provide new information on the bombing, Ms. Ginsberg said she could no longer trust Argentina’s judiciary. “It won’t take us toward the truth,” she said.As the anniversary shifted attention to the bombing, and away from Mr. Nisman, some said his death might pave the way for justice.“I don’t think Nisman was the key to solving the case,” said Horacio Lutzky, 55, a lawyer who has researched the bombing for years and wrote a book, “Toasting Amid the Rubble.” “Perhaps this tragedy will allow the case to embark on paths that had been abandoned.”Others saw the anniversary as a time to reflect on wider issues, like perceived undercurrents of anti-Semitism. “When Jews feel scared, they unite,” said Roberto Pikholtz, 72, a retired businessman, pointing to the large crowd.Mostly, there was a sense of desperation. “The death of the prosecutor is a phenomenal blow to the search for the truth,” said Luis Czyzewski, 71, an accountant whose 21-year-old daughter died in the attack. His wife survived.Mr. Czyzewski recalled running toward the wreckage of the community center, past shards of glass and broken blocks of masonry. He wrestled past police officers, who had sealed the site. He found his wife, her face blackened and bruised.Their daughter, Paola, was among the first to have died in the blast, experts later told Mr. Czyzewski.“Each year, you feel worse than the last,” he said.By Benedict Mander in Buenos AiresJuly 19, 2015Soledad Rodríguez Pons admits she had no idea what bitcoin was when it was suggested to her two years ago that the digital currency could provide a neat way of dodging Argentina’s strict capital controls.“I was suspicious at first,” says the 29-year-old owner of a budget hostel in Buenos Aires.“But I took the risk, and it was well worth it,” she adds, explaining that she takes credit-card payments from foreign tourists in return for the digital currency. At the moment, she can sell her bitcoins on Argentina’s unofficial currency market for 50 per cent more than she would get at the official exchange rate.The prolonged use of capital controls in Argentina since 2011 has wreaked havoc for businesses operating in South America’s second-largest economy — not only restricting access to foreign currency and leading to a heavily overvalued official exchange rate, but also exacerbating economic stagnation and double-digit inflation.Under the leftist government of President Cristina Fernández, no immediate change is expected in Argentina’s complicated economic conditions, which have seen the use of bitcoin more than double over the past year, mainly among small businesses. This represents much faster growth than elsewhere in Latin America, according to bitex.la, a regional bitcoin exchange.Recent raids on currency trading houses and new powers for the national spy agency to prevent speculative attacks pushed the peso’s black market value this week to its lowest levels since Argentina defaulted last year on its foreign debt for the second time this century.Greek woe brings powerful sense of déjà vu for ArgentinaHealth and hospital workers advance towards Buenos Aires’ Plaza de Mayo during a protest by various workers unions 29 August 2001.On a cruise round the Mediterranean, Domingo Cavallo, Argentina’s economy minister in the run-up to the country’s dramatic economic collapse in 2001, was bemused when he was unable to use his credit card during a brief stop-off on Greek soil last week.However, presidential elections in October are expected to bring in a more market-friendly administration, and investors hope that untangling capital controls will be one of the top priorities for the new government. That has triggered a heated debate over how to defuse a situation that has caused an investment drought in Argentina.“As always happens with such controls, it is much more complicated getting rid of them than it is putting them in place,” says José Luis Espert, an Argentine economist.The two leading candidates advocate sharply differing methods. Daniel Scioli, the one-armed governor of Buenos Aires province backed by Ms Fernández, favours a more gradual approach, although there is growing concern that his government ties will limit his room for manoeuvre.Mauricio Macri, the centre-right mayor of the city of Buenos Aires, backed by the markets, prefers a more immediate solution.Although Mr Espert also recommends a swift removal of capital controls, he says it must be accompanied by a “technically solid economic plan” that inspires strong confidence in the markets. “Without a credible plan, shock treatment can be just as damaging as a more gradual approach,” he warns.José Urtubey, vice-president of the Argentine Industrial Union (UIA), a powerful business chamber, doubts that shock therapy will work. Although capital controls played a big part in a 2.6 per cent contraction in Argentina’s industrial sector last year — foreign currency is essential to import materials needed for industrial production — he fears that central bank reserves could not withstand the pressure on the currency generated by the controls’ sudden removal. “The remedy could be worse than the illness,” he says.As always happens with such controls, it is much more complicated getting rid of them than it is putting them in place– José Luis Espert, Argentine economistSuch resistance to change explains why Mr Espert believes that Argentina’s volatile economy has for the past half century been stuck in a “vicious triangle”, whose vertices are crisis, followed by a rebound and then mediocrity — which every decade or so leads to another crisis.“Soon there will be another one,” he says, pointing to a lack of consensus over how to fix the country’s serious macroeconomic imbalances, especially a gaping fiscal deficit, which he fears will lead to more mediocrity. “Argentina finds it very difficult to escape that triangle. We are afflicted by a kind of [economic] Stockholm syndrome,” he says.If the future of Argentina’s economy is as gloomy as Mr Espert fears, that would be good news for bitcoin, which is still in its infancy in Argentina, with only about 6,000-8,000 users.Franco Daniel Amati, a co-founder of Bitcoin Argentina, a kind of embassy for bitcoin in the heart of the Buenos Aires financial district, is optimistic about prospects for the digital currency in a country where still only half the population entrust their money to the formal banking system.“A recurring inflation crisis, capital controls and overall financial repression make life very difficult in Argentina. More and more people here are looking for ways to get around these problems, and bitcoin is the perfect solution,” he says.19 July 2015BUENOS AIRES, July 19 (Reuters) – Argentina’s business-friendly PRO party won the Buenos Aires mayoral runoff on Sunday, clinging to its stronghold for a third consecutive term ahead of presidential elections in October, but prevailed by a smaller-than-expected margin.Outgoing mayor and PRO presidential candidate Mauricio Macri had sponsored the campaign of his chief of staff Horacio Rodríguez Larreta, who won 51.6 percent of ballots cast on Sunday, official returns showed.That put Larreta only a few points ahead of ECO party candidate Martin Lousteau, who picked up 48.4 percent with 99 percent of the vote counted. Larreta had been expected to leave Lousteau trailing by a margin of 9 to 13 points.With Buenos Aires, the PRO’s power base, accounting for about 8 percent of Argentina’s national vote, Macri would have hoped his party would win by a wider margin.He must drum up support elsewhere to win in the presidential elections on Oct. 25.“I would like to thank Mauricio (Macri) for showing that it is possible in Argentina… to transform reality,” Larreta told cheering and clapping supporters in a televised speech.The candidate of President Cristina Fernandez’s party, Front for Victory, had crashed out in the first round of voting two weeks ago. Since then, party members have dismissed the runoff as irrelevant, saying the PRO and ECO are much akin.Those who voted ECO – a regional alliance – in the Buenos Aires elections could end up voting PRO on a national level.The outgoing president is constitutionally barred from seeking a third consecutive term. She has endorsed the candidacy of Daniel Scioli, governor of the Buenos Aires province.Fernandez is faulted by big business for imposing a web of currency and trade controls that have hurt the economy, which has teetered on the brink of recession over the past year and has one of the world’s highest inflation rates.The Buenos Aires elections have highlighted her party’s lack of popularity in the capital.But the Front for Victory remains popular in Argentina’s provinces in part because of this government’s generous subsidies. Scioli, who is expected to keep some of Fernandez’s policy mix but return to slightly more orthodox economics, is leading polls.5. ARGENTINA IS STILL HELPING IRAN COVER UP ITS ROLE IN THE BOMBING OF A JEWISH COMMUNITY CENTER 21 YEARS AGO (Business Insider)By Toby Dershowitz, ContributorJuly, 18, 2015July 18th marks 21 years since the largest terrorist attack in Argentina’s history: the bombing of the AMIA Jewish community center in Buenos Aires, which killed 85 individuals and wounded hundreds more. Evidence is mounting that Argentina’s president is seeking to whitewash Iran’s role in the attack.Earlier this year, Argentina’s special prosecutor in the case, Alberto Nisman, met a suspicious death just one day before he was due to present evidence of a secret Iran-Argentina backchannel. Nisman had already implicated senior Iranian officials in the 1994 bombing. As a result of his investigation, INTERPOL had issued red notices (tantamount to international arrest warrants) for these Iranian officials.But Argentine President Cristina Fernández de Kirchner’s government has taken a series of steps that appear aimed at covering up Iranian involvement. In the latest example, the Argentine government is trying to reverse a court decision that ruled an Iran-Argentina Memorandum of Understanding related to the AMIA attack (MOU) unconstitutional.In 2013 Kirchner’s government signed an MOU with Iran that ostensibly would have had the two countries jointly investigate the AMIA bombing. Nisman believed the MOU’s real purpose was to rid Iran of culpability in the attack.Then-Iranian foreign minister Ali Akbar Salehi argued that according to the MOU, “INTERPOL must eliminate the charges against the Iranian authorities.” Salehi, a nuclear scientist and head of the Atomic Energy Organization of Iran, was a key part of the secret backchannel.In 2014 a lower court determined that the MOU was unconstitutional and that it interfered with an independent judicial investigation. That ruling was being reviewed by a panel of three judges in the country’s highest criminal court, the Court of Cassation, which is second only to the Supreme Court in Argentina’s legal system.The panel of three judges was set to hold a hearing to announce its decision on June 22, but it was abruptly canceled. Three days later, Judge Luis Maria Cabral was removed by the Judicial Council without explanation and replaced by Judge Claudio Marcelo Vazquez, who is recognized as supportive of the government’s agenda. The Judicial Council, which holds a pro-government majority, took this action following new authority it was granted to replace surrogate judges with appointees more supportive of the government’s agenda.Judge Cabral is the head of the Argentine Association of Magistrates, an organization that vigorously opposes efforts by the executive branch to interfere in the judiciary. His term had no end date.Why would the Judicial Council suddenly remove him? Perhaps because Cabral had expressed his intention to uphold the lower court’s 2014 ruling that found the MOU unconstitutional — a position the government opposed.Four opposition members of the House of Deputies then filed a formal federal complaint against the Judicial Council demanding that Cabral be reinstated. AMIA and DAIA, the Jewish organizations that filed the original court challenge against the MOU, demanded that Cabral’s final opinion be used in the resolution of the case.Cabral was removed during a session called with little advanced notice. One of the members of the Judicial Council, National Deputy Gustavo Valdes, said the government prevented him from attending the session by holding up the flight he was to take to get there.Valdes’s flight on the state-run airline Aerolineas Argentinas was abruptly canceled. Poor weather was cited, despite the fact that the weather was fine in both the departure and destination cities. The pilots had received orders from the airline not to leave their hotel, according to media reports. The airline’s CEO is Mariano Recalde, who is also the government party candidate for mayor of Buenos Aires.Judge Cabral filed a complaint to the Federal Administrative Court and argued that “it is incredible to illegally substitute one surrogate judge for another.” The government is seeking to “discipline” the judicial branch, he said.Buenos Aires City prosecutor Martin Ocampo said, “I believe the process by which Cabral was removed is unconstitutional.”Removing Cabral from his position days before a decision was to be rendered is part of a disturbing pattern of activities by Kirchner’s government, whose singular purpose appears to be ending Nisman’s investigation of Iranian complicity.The Kirchner government replaced Nisman with three pro-government prosecutors, and engaged in an aggressive campaign to discredit Nisman. This included an effort to characterize his death as a suicide, despite substantial evidence to the contrary. Meanwhile, judges and a prosecutor known to be supportive of the government declined several requests to investigate the complaint Nisman filed about the government’s secret back-channel negotiations with Iran.Argentinian journalist Eduardo van der Kooy writes that Kirchner’s “pact with Iran is what is keeping her awake at night the most.” If the Court of Cassation were to uphold the unconstitutionality of the MOU, that declaration “would include lethal arguments that would blame the President for having … surrendered to another nation the prosecution of a tragedy that happened on [Argentinian] soil.”This would translate into treason, he said, and would “prevent Cristina’s desire to leave power with glory. For that reason she is demanding closure of the Iran circle. Even at the cost of undoing the judiciary.”Argentina should not be allowed to bury the truth of Iran’s involvement in the AMIA bombing along with Nisman.And as our own government reviews its terrorism policy and threats to our homeland, it should ensure Iran continues to be held accountable for its role in the 1994 atrocity.Toby Dershowitz is Vice President for Government Relations and Strategy at the Foundation for Defense of Democracies, a non-partisan think tank in Washington, DC6. WHY THE AMIA MASSACRE AND MYSTERIOUS DEATH OF ALBERTO NISMAN STILL HAUNT ARGENTINA (The Daily Beast)By Michael LuongoJuly 20, 2015This weekend Argentina remembered one of the worst massacres of Jews since World War II, and the mysterious death of the special prosecutor just as he was about to accuse the country’s leadership of a coverup.BUENOS AIRES—The names of streets and neighborhoods in Buenos Aires often commemorate historical events.Most relate to its revolutionary period, like Nueve de Julio, often tagged the world’s widest avenue, for the 9th of July, Argentina’s Independence Day.A more recent July date lingers in Argentine memory: July 18, 1994, when a car bomb ripped through AMIA—La Asociación Mutual Israelita Argentina—the Jewish community center in Buenos Aires’s Abasto neighborhood.Though the country denies involvement, Iran has long been blamed for the incident, which was Argentina’s worst terror attack.Every year, the event is commemorated with a ceremony in front of the since reconstructed and now heavily fortified AMIA.This year with the true anniversary on Shabbat, the Jewish holy day, it was held the morning of Friday, July 17.The attack date marks another anniversary: it is 6 months since the death of special prosecutor Alberto Nisman, found dead January 18 under mysterious circumstances, days after announcing he would reveal evidence accusing the country’s highest authorities of complicity with Iran in covering up the AMIA bombing.As reported in two New Yorker articles, Nisman was found dead in the bathroom of his apartment in the Puerto Madero neighborhood of Buenos Aires. He had a bullet wound to his head and a 22 caliber gun near his hand.The gun was apparently lent to Nisman by his assistant when he feared being murdered. There were no signs of forced entry or robbery in the apartment. In a garbage can at the scene a copy of a draft of a warrant calling for the arrests of President Cristina Fernandez de Kirchner and foreign minister Hector Timerman was found.Four days before he had accused them of being involved in a cover up to protect those involved in the AMIA bombing. More than a decade of Nisman’s life had been spent investigating AMIA and the coverups.The theme of the 21st commemoration is ‘Victims of Terrorism, Victims of Impunity’, and Nisman’s death slashes open the wounds of survivors and those who lost loved ones.A series of events, exhibits and a renamed subway station, completely redesigned as a memorial to AMIA, marked this year’s anniversary.Bearing Witness As A SurvivorAna Weinstein, Director of AMIA’s Marc Turkow Center of Documentation and Information on Argentine Judaism and of the Vaad Hakehilot Federation of Argentine Jewish Communities, is a survivor of the bombing.That year was meant to be a happy one, the organization’s 100th anniversary. Weinstein, who explained personally and not as a representative of AMIA, told the Daily Beast, “Every July 18, it brings me back to the moment. This shock that somebody wants to kill you. It is a very strong feeling.”While the commemoration generally followed the same pattern as in years past, Weinstein said Nisman’s death added new elements.“This anniversary has to do with some ingredients that we cannot ignore, about the shocking thing that happened with Nisman, his appearing dead.”She added, a sense of both sadness and anger in her eyes, “It shocked me, because it was death again. Somebody is dead again related to AMIA bombing. Somebody is dead again and I had this feeling that we would never know exactly what happened, like we don’t know exactly what happened with this bombing.”Weinstein, who has written several books on AMIA, emphasized the significance of the event Nisman was investigating.The 1994 bombing was the largest terrorist attack on Argentine soil, and is one of the largest massacres of Jews in the post-Nazi period.She said, “it was the first attack against a Jewish premises, against Jews, and where 85 people were killed, not all of them Jewish. This speaks of something that is very big in its intensity of destruction and hate.”It followed an earlier similar bombing, on March 17, 1992, of the Israel Embassy which killed 29 people.Argentina has the sixth largest Jewish population in the world, and the largest in Latin America, with estimates ranging from 250,000 to 300,000, according to Weinstein.Weinstein feels the size of the AMIA case and its unsolved nature have a bearing beyond Argentina.“Those organizations that are aware that hate and discrimination and violence and fundamentalist thinking connect with each other, are aware that is dangerous for the world and for society. Attacking Jewish targets means any other day they can attack other targets that are not Jewish as well,” she said.The case’s mysteries have exacerbated the emotions of those connected to the tragedy.“We do not have justice after twenty years. Relatives who have lost their loved ones don’t know who is to be blamed. That is the most important thing to understand, and that is the thing that is the most difficult thing to understand, because of course we don’t have any answers. Things like that don’t happen unless they cross political situations. Somebody who was very high up may have come very close to knowing the truth.”Art and PainThroughout Buenos Aires, art spreads knowledge of the AMIA bombing, connecting it to other forms of hatred during the commemoration period.In the downtown Corrientes Avenue theater district, AMIA worked with SIGEN, the Sindicatura General de la Nación, or Office of the National Comptroller, to exhibit murals through August not only on AMIA, but on genocide across the world.Perhaps the most impactful is a three by nine meter mural Olvido Terminal, ‘Forgotten Terminal,’ a concentration camp scene by Mariano Sapia.Swastikas adorn black flags in the background of an industrial landscape. Grey and brown bodies flow down a cliff, a silhouette of a woman on her knees, a gun to her head, nearby.Clouds of black smoke from chimneys form faces. Train tracks lead to cattle cars, gallows with hanged men to one side, women, naked, lined up on the other.Emaciated men stare through barred barracks windows. The only brilliant colors are a row of children in the foreground who seem newly arrived, some with dolls and teddy bears.They stare out through barbed wire with unsure, frightened expressions at eye level with children who come to see the exhibit, as if to connect them to the historical tragedy.At Recoleta Cultural Center, a public art space within a former convent adjacent to Recoleta Cemetery where ‘Evita’ (Eva Peron) is buried, a small exhibit open through August features two pieces of interactive art: ‘Illustrated Memory,’ from graffiti art collective Buenos Aires Stencil; and ‘Carriage of Memory’ by Jorge Caterbetti, a cart loaded with boxes full of mock Supreme Court documents related to AMIA and other Argentine tragedies along with an accompanying video.Inside AMIA, Argentine artist Milo Lockett worked with students and organization staff on new murals to exhibit at SIGEN.Lockett told the Daily Beast that art can “transform this pain into love. I can’t say that pain can change. But pain can transform into truth. And I believe that we have to say that we artists are present and are participating. Not only as artists but as Argentine citizens.”Lockett, who is not Jewish, feels the AMIA tragedy can be a unifying force.“AMIA is the cause of all of Argentina. It is not just for Jews and for the Jewish community. It is a question of the state. I don’t want to show that this is a country without impunity, but that it is a country that searches for the truth. And the truth needs to come into the light. It is a shame that for these 85 victims, it has been 21 years, and how many presidents, and they cannot clarify what happened with the attack.”AMIA’s Youth NightThe night before the main commemoration, nearly 1,500 people participated in AMIA’s Youth Night, according to one AMIA staffer.The event, with displays, bands, and speeches grew out of an earlier, informal vigil in which young people stayed near AMIA until daybreak, according to 28 year old Marianela Aprosof, who was there representing MASA Argentina, an organization bringing young Argentines to Israel.Aprosof acknowledges most young attendees have no direct knowledge of the bombing.At the same time, she feels youth must know more than just AMIA’s tragic history. “AMIA is an institution, with events, programs, things for kids, and information. The young people need to think of it as more than just the day the bomb happened,” she told the Daily Beast.Youth Night, Aprosof said, is also growing in popularity. However, she did not feel Nisman’s death played a role.Instead, she said, “the real reason more are coming is because the cause is not being investigated. It is not just Nisman.”Iran and ImpunityOn a cold, sunny Friday morning, nearly 6,000 people attended the main ceremony on July 17, according to AMIA press coordinator Marcela Pieske.Nearly all the stores along the route were closed, but the faint smell of zataar hung in the air, testimony to the many Sephardic and Mizrahi shops and kosher restaurants open the day before.Family members and survivors were near the stage, youth groups behind them. Many held images of victims on small posters, their life stories printed on the back.At 9:53 a.m., the time of the bombing, a sense of shock and silence fell over the chatty crowd as an air raid siren echoed through the streets.At times crying, Argentine television journalist Cristina Pérez served as mistress of ceremonies, introducing speakers and family members who read the names of victims, the crowd shouting “presente” after each one.At points, readers choked into tears, perhaps when they had come to the names of their family members.Among the most powerful speeches, his voice booming against the stucco facades of the surrounding buildings, was that by Ariel Cohen Sabban, AMIA’s Director and the President of the Federation of Jewish Communities of Argentina.Cohen Sabban spoke of Hezbollah and Iran’s involvement in the bombing, demanding Argentina’s government work with Interpol in “actively seeking out the Iranian suspects, and that the requests for their capture are not just a formality.” (Here is a link to the text).Nisman was also a concern in Cohen Sabban’s speech with the reminder, “Tomorrow will also be six months after the death of the prosecutor Alberto Nisman. An event so traumatic for society that it made us feel the echoes of the bomb of July 18.”He added that as with AMIA and the impunity around the original investigation, the mystery of Nisman’s death leaves Argentines wondering, “what happened and how did the prosecutor die investigating the bombing?”Nisman’s death was, in essence, added to the total number of victims of the AMIA bombing that day.His elder daughter, Iara Nisman, 15, walked on stage to emotional applause to light a candle and place a rose into a stand marked Justice and Memory.Perez read a speech prepared by Nisman in which she wrote, “I wanted to thank you for the place you have given to pay homage to my dad and convey that, even though my pain is more recent, I understand and share the long route of searching and suffering that you have carried for 21 years.“Because I saw how much my dad worked for justice and heard from him the details and stories behind the families of the attack.“Both my sister Kala and I, we ask you to join us and help to find the truth about what happened to my dad, no matter what happens, without giving importance to things that are sometimes said to dirty him, because he cannot defend himself when they try to detract from his effort and work.” (This is the original text of the speech from La Nacion).Special prosecutor Viviana Fein, a long time colleague of Nisman, is in charge of the investigation into his death. Fein is currently pursuing a forced suicide theory in explaining the death.Redesigned Subway Station Honors AMIA DeadThe same week, the closest subway station to AMIA, the B-Line’s Pasteur, was renamed Pasteur-AMIA.The memorial went far beyond name, the station redesigned with artworks and interactive displays in a commemorative form known in Argentina as an Espacio de la Memoria, or ‘Space of Memory.’A large niche in the subway station lobby contains a bold, black and white placard in Spanish explaining the attack, an English version to its side.A relic from the bombing, a twisted broken typewriter, is set in a glass display case within a wall adorned with images from a vigil held soon after the attack.A touch screen allows visitors to tweet their thoughts on AMIA, record short voice messages and examine photos and stories of the 85 victims.On the subway platforms, an electronic calendar counts the number of days the terror attack remains unsolved.The rounded platform walls are decorated with new ceramic works by 25 artists, largely in political cartoon format.Some of the individual pieces are remarkable for their criticism of Argentina’s government.One contains an image of the Casa Rosada, the Presidential Palace, splattered in blood; others have blind justices or authority figures asleep while AMIA is attacked. Some are sentimental, parents talking to children about AMIA and other Argentine tragedies.Family members of the AMIA victims appreciate the city’s new memorial. Mario Averbuch, whose daughter Yanina died in the 1994 bombing, told the Daily Beast inside of the station as he made his way home after speaking at the ceremony, “It was a fight to get this done, but we made it happen.”Another family member, Sofia Guterman, whose daughter Andrea died in the attack, told the Daily Beast that the redesigned subway station was, “a work of love, re-expressing the tragedy that is so terrible.”Guterman added, “For us, it’s very important, because within this subway station pass millions of people. They are going to look at this. This goes from the older people who remember when this happened to the new generations who are going to pass this and ask, ‘What happened? What is this?’”A new trial has been set for August 6 to examine the coverup of bribes related to the original investigation of the AMIA bombing.This weekend Argentina remembered one of the worst massacres of Jews since World War Two, and the mysterious death of the special prosecutor just as he was about to accuse the country’s leadership of a cover-up.Regarding Nisman’s investigation and mysterious death, Guterman said, “It was many years that he was doing this. You don’t have to imagine that people wanted to kill him. This was not suicide. They killed him. Now, we don’t know anything.“If we don’t keep fighting for this, there will pass year after year since the attack on AMIA, without knowing anything. Nor will anything happen for Nisman either. Every day we are further from the truth.”It is for this reason that she appreciates the annual commemorations, and the new memorials.“Memory is very important, because there is no justice,” Guterman said. “So we have to work very hard for the sake of memory, because memory is the justice that we have.”By Peter KohliJuly 17, 2015Another pivotal election in the developing world will take place on October 25th in Argentina. The current president, Christina Kirchner, is prohibited from seeking a third term, though for a time there was speculation that she might try and run for congress. That idea has now been put to rest. She certainly has had a rocky eight years in power, which saw the economy of the country go from bad to worse.It’s demeaning for the head of any country to resort to racism as a way to deflect from the problems taking place under their watch. But according to Commentary Magazine, that is exactly what happened recently when Ms. Kirchner visited a school and asked the students what they were reading in Shakespeare. “In one tweet, Kirchner recounted how she had asked students she met which Shakespeare play they were studying. When they told the president they were studying Romeo and Juliet, Kirchner said she responded, ‘I said, “Have you read The Merchant of Venice to understand the vulture funds?” They all laughed. ‘No, don’t laugh. Usury and the bloodsuckers were immortalized by the best literature for centuries,’ she then tweeted to her two million twitter followers.”Additionally, the Wall Street Journal reports that the poverty level in Argentina has gone from 24.7% in 2011 when Ms. Kirchner was reelected, to 28.7% this year. Though she actually had the nerve to tell a United Nations meeting that due to her policies, that rate has actually fallen to 5%. How laughable!Meanwhile, the people of Argentina suffer. We can only hope that they will not vote for her named successor, Daniel Scioli, and instead vote for the center right candidate, Mauricio Macri, who is viewed as being market friendly. The current inflation rate in Argentina is 15%, while the interest rate, at 24%, is one of the highest in the world.As far as investing is concerned, there is only one Argentina focused ETF, Global X MSCI Argentina ETF (Argentina (PZE) Shares Cross Below 200 DMAPowered by Market IQ) which has a YTD return of 8%.Just to think that at the turn of the last century Argentina was one of the richest countries in the world. Oy vey!8. ARGENTINA’S INFLATION REMAINS AT HIGH LEVELS WHILE OUTLOOK PREDICTIONS SUGGEST STAGNATION IN SHORT TERM (IHS Global Insight Daily Analysis)By Paula Diosquez-Rice, Mario Guillen17 July 2015Although consumer confidence in Argentina has increased according to a poll, more than half of respondents expect a bleak economic situation in the coming year.OutlookAccording to Argentina’s National Statistical Office (Instituto Nacional de Estadística y Censos: INDEC), consumer inflation remained at 1.0% month on month (m/m) and 15.0% year on year (y/y) in June.The category of other goods and services posted the quickest increase, up by 3.2% m/m, followed by the leisure category, up by 1.7% m/m, and the equipment and household maintenance category, up by 1.2% m/m, the same increase observed in the category for medical attention and health expenses.Inflation figures presented by the opposition in Congress point to a rise of 1.53% m/m and 27.9% y/y, contrasting with INDEC’s figures. With regards to inflation expectations for the next 12 months, Torcuato di Tella University reports a rise of 2 percentage points, placing it at 30%, according to the median, while average expected inflation in annual terms rose to 30.5%.Argentina’s economic distortions are a result of the government’s interventionist approach to economic policy. Bans on trade, currency exchange controls, wage ceilings, and more red tape for companies were aimed at reducing capital flight, but have severely compromised the country’s economic flexibility and, therefore, a readjustment of the productive sector.Dismantling these distortions will be the main political topic during the presidential campaign in the run-up to the election in October, with speculation on the pace of reform and its effects on the value of the peso. As the balance of trade points to a loss of competitiveness, the magnitude of a necessary devaluation will be a key element of sensitive reform.Even if changes are implemented relatively quickly, institutions such as the International Monetary Fund (IMF) expect the current recessionary environment to persist until 2017, the IMF revealed in its latest report.17 July 2015The recent fall in international oil prices has led Argentina’s state oil company, Yacimientos Petrolíferos Fiscales (YPF), to focus on projects that seek to improve competitiveness, especially in Vaca Muerta, a shale oil field that will require huge investments to commercialise. New investments to increase production of conventional oil will help to reduce the energy trade deficit, which has persisted despite the domestic economic downturn and falling prices.In May YPF released a report showing the results of three years of state management (the company was re-nationalised in May 2012). In this period natural gas production rose by 25%, oil output grew by 10% and reserves expanded by 24%. Investments totalled US$6.1bn in 2014, well over double the 2011 level. The company’s sales rose by 30%, and pre-tax income increased by over 40%. Production continued to grow in the first three months of 2015: YPF’s oil output rose by 5% and its production of natural gas rose by 14%. This compares with a 1% decline in total national oil output and a small rise of 2% in national gas output.New announcements suggest growth in outputSince the release of the May report YPF has made several announcements that are indicative of further output growth. At the end of May the company announced the find of a new conventional oil field in Los Caldenes, located in Northern Río Negro province. Exploration works had started last year, and the field’s potential resources now amount to 40m barrels. Soon after, YPF announced an agreement with Petrolera Pampa (which belongs to Argentina’s Pampa Energía group) to increase existing investment in Rincón del Mangrullo, in Neuquén province, to expand the production of tight gas. In December 2014 Pampa Energía had presented YPF with a US$150m project to improve surface facilities, in order to double the capacity of natural gas treatment plants to 4m cubic metres of natural gas per day. This project has now finally been approved. Pampa Energía will also invest US$22.5m in drilling new wells to expand gas production in the area. Both companies will jointly invest US$40m for new exploration in that area.Although these projects will help to raise YPF’s production of conventional oil and natural gas, the company’s key project continues to be Vaca Muerta, a shale oil field located in Neuquén, with a potential output of 23bn barrels. The president, Cristina Fernández de Kirchner, recently announced the construction of a railway to connect the port of Buenos Aires, the capital, to the Vaca Muerta field, seeking to cut transport costs for imported inputs by a quarter. This could prove important in the light of the recent drop in oil prices and the drop in competitiveness caused by renewed real appreciation of the Argentinian peso this year. YPF has also announced that it will start import-substitution of the sand needed for the fracking process at Vaca Muerta, which is also expected to cut down drilling costs. These announcements should help to ease labour tensions that recently erupted in Neuquén, when construction workers blocked roads in the province, warning that around 400 workers (around 15% of those working in construction activity in the shale field) could be dismissed, owing to a delay in the Vaca Muerta construction works caused by a drop in oil prices.The Vaca Muerta project remains crucial if the country is to overcome the energy crisis that has come about as a result of a decade of government intervention in the sector via tariff freezes, price controls and export taxes, which have driven a decline in oil and natural gas production and reserves. This has produced problems for the balance of payments: in 2014 the energy trade deficit was above US$6bn. Although in the first four months of 2015 the deficit decreased, it did not disappear altogether, despite the domestic economic downturn and the drop in international oil prices. The latest announcements will go some way to reducing the energy trade deficit further. However, commercialising Vaca Muerta will require a much larger investment commitment over time, and it will fall to the next government, which will take office in December 2015, to secure these long-term commitments.By Charles Newbery17 July 2015Buenos Aires (Platts)–17Jul2015/202 pm EDT/1802 GMT A federal judge in Argentina has ordered state-run energy company YPF and other parties to hand over information for an investigation into alleged overpayments and other irregularities in the purchase of LNG.At YPF, a source confirmed the arrival of the request.“We are collaborating with the justice system,” the source said on the condition of not being identified. “We are complying with the order for documentation.”Judge Claudio Bonadio issued the order on Friday. In addition to YPF, officials delivered the order to Enarsa, a state company that oversees LNG imports, and the Planning Ministry, which oversees national energy affairs and Enarsa, according to a report by La Nacion newspaper.Bonadio’s office could not be reached for comment. Enarsa likewise could not be reached for comment and the Planning Ministry’s press department declined immediate comment.YPF has handled LNG purchases at the request of Enarsa since the former came under state control in 2012.Bonadio is investigating a case presented last October by Federico Pinedo, Patricia Bullrich and Laura Alonso, lawmakers for the right-wing opposition party Republican Proposal.The lawmakers filed the case based on claims that Argentina may have overpaid for LNG supplies in recent years.The allegations derived from comments by Roberto Dromi, a lawyer and former minister of Public Works and Services, about a lack of transparency and illegalities in the tenders for cargoes. The remarks raised suspicions that officials and advisers involved in the tenders and the purchases may have benefited personally from the deals.Dromi made the comments in an interview published in La Nacion newspaper on October 18, 2014, according to a copy of the complaint.Dromi’s consultancy had worked for several years advising LNG suppliers on doing business with Argentina. “The contract was done in English, with secret clauses, armored keys and nobody knows the specifications, or price, or anything,” Dromi said in the interview.YPF has denied any irregularities.Argentina imports an average of 30 million cubic meters/d of gas, some by pipe from Bolivia and some as LNG.By John HopewellJuly 20, 2015First-half 2015 Argentine box office soars to modern-day record as national cinema awaits ‘The Clan,’ ‘Truman,’ ‘The King of Once’MARBELLA, Spain — Argentina’s Mar del Plata Festival, Latin America’s only “A” grade fest event, has moved forward to an early November berth, running Oct. 30 to Nov. 7 this year, Lucrecia Cardoso, president of Argentina’s INCAA Film Festival, confirmed Saturday at the 2nd Platino Awards.Approved by the Intl. Federation of Film Producers Assns., (FIAPF), the film festival regulator, the change is to avoid a clash with potential second-round voting in Argentina’s upcoming general elections, she added.Celebrating its 30th edition in 2015, Mar del Plata moved last year to a later date, just one week before early December’s Ventana Sur, running Nov. 22-24. That allowed the fest, which was graced by the presence of Viggo Mortensen and Paul Schrader and saw a hike in attendance to around 130,000 in tix sales, to begin to spark synergies with Latin America’s premier film mart: Mar del Plata’s Work in Progress took place only three days before Ventana Sur, for instance.The Mar del Plata Festival will once more host Argentina’s Encuentro de Comunicacion Audiovisual (ECA), an annual meet which debates the future of Argentina’s film/TV biz. This year it will also see a FIAPF board meeting.Mar del Plata has yet to announce its industry activities, which may well build on its successful Work in Progress event, or, as it 2015 dates half clash with the American Film Market, potential links with Ventana Sur.Backed by Argentina’s powerful INCAA state film-TV agency, which co-launched Ventana Sur with the Cannes Festival and Film Market in 2009, Mar del Plata is also building as a springboard for young Argentine talent at a time when Argentina is producing a clutch of the most ambitious movies to come out of Latin America, such as Damian Szifron’s “Wild Tales,” which swept the Platino Awards on Saturday, and now Pablo Trapero’s “The Clan,” which bows Aug. 13 in Argentina, plus Lucrecia Martel’s “Zama.”Argentina is also emerging as an en energetic international co-producer not only with Europe but also the rest of Latin America. In Marbella, Cardoso pointed out that over 2009-14, more than 50% of INCAA-backed films, via its main subsidy lines, were international co-productions,linking up with 24 countries in total.Awaiting some of its biggest 2015 plays – “The Clan,” Cesc Gay’s “Truman,” Daniel Burman’s “King of the Once” – Argentine films’ domestic market share to date this year is around 11%, thanks to adolescence-themed “Abzurdah,” “No Kids,” Santiago Mitre’s Cannes Critics’ Week winner “Paulina” – which has notched up 108, 508 admissions, three times the trawl for his debut, “The Student,” four years ago – and “Socio por accidente.” Argentina punched 25 million admissions first-half 2015, a record since 1986, Cardoso said.2015’s national film share might not break Argentina’s 2014 17.8% modern record, driven by “Wild Tales,” but should be significantly up on the average for years before 2013 when Argentina’s national share rose to 15%, she observed.“Argentina’s production section is growing, and making films at a higher scale and ambition,” she added, by way of explanation.Mar del Plata’s “A”-grade status points in popular parlance to its being one of FIAPF’s 15 fests – along with most, but not all, the biggest festivals in the world such as Cannes, Berlin and Venice – which are accredited by FIAPF as competitive feature film festivals.By John MalathronasJuly 17, 2015(CNN)The Buenos Aires railcar on Line A is air conditioned and sparkling new, as is its destination, Flores metro station.I’m sure it’s just a coincidence that Pope Francis comes from Flores.It’s because of the pontiff that I find myself at 3 p.m. outside the Basilica of San Jose, an 1880s church with a facade of Corinthian pilasters and an impressive Italianate clock tower.It seems a gigantic church for a minor middle-class parish, but in the 19th century Flores was the abode of prosperous landowners whose estates hosted political conferences and witnessed lavish parties.I’m here to join a walk to the Pope’s old stomping grounds.Daniel Vega, a guide with a booming voice and clearly enunciated Spanish meets me and three ladies from northern Argentina.This being Latin America, we spent the first 15 minutes getting to know each other.Our tour starts in the basilica because, as Daniel maintains, a 17-year-old Jorge Bergoglio — now known to the world as Pope Francis — had his epiphany in that confessional on our left.Flight from fascism“It was September 1953, springtime,” says Vega. “Jorge was off to meet his friends who were waiting in the square. When he passed by the basilica, somehow he felt the need for a confession.“He heard no voices, saw no visions, but that confession was a transcendental experience. He left with a strong conviction that he had to become a priest.”What about his friends?“He forgot about them and went home.”Outside, Vega gives us the back story.How the Bergoglio family had a candy store in Portacomaro, in Italy.How they left for Argentina on the steamer Giulio Cesare in January 1929 to escape the fascist regime of Benito Mussolini.Daniel adds that delays in selling their shop made them miss the earlier sailing of Principessa Mafalda.Papal ice creamIt sank in October 1927 off the coast of Brazil with the loss of 314 lives.Whether true or false, this act of apparent divine providence has already entered popular mythology.The Pope’s popularity has helped local businesses.In front of us stands a pizzeria, cheekily named “Habemus Pizza y Pasta” after the traditional “Habemus Papam” announcement following a pope’s election.A team of Argentinian ice cream makers have already presented His Holiness with his own ice cream flavor: vanilla and lemon, in the papacy’s traditional colors of white and yellow.We stop in front of a white one-story terraced house at Calle Varela 268.There are bars on the windows and the twin external doors lead to two separate flats.It’s all so ordinary except for the plaque: “Pope Francis was born here.”Until October 2014 another address at Calle Membrillar was considered to be the Pope’s childhood home.Indeed, when this tour started Pope Francis asked: “Which house do they go to?”When asked what he meant, he waved it away: “Let the poor neighbors live in peace.”Not any more.This address was discovered by historian Daniel Vargas who dug out the Pope’s birth certificate and sent a copy to the Vatican.Imagine his shock when his office phone rang: Pope Francis wanted a word.It was a word of confirmation.Little Jorge Bergoglio spent the first five years of his life here.Love letterOnly when the family expanded did they move to a bigger house at Calle Membrillar.There’s no doubt about our next stop a few blocks south.A bright red exterior announces Escuela Pedro Antonio Cervino, a mixed primary school that Pope Francis attended.The pervading silence is a reminder that it’s summer vacation time.After Cardinal Bergoglio’s election as pope, an elderly neighborhood woman claimed to have been his childhood sweetheart.“He wrote me a love letter”, she insisted. “And said that if I didn’t marry him, he’d become a priest!”The media demanded to see the letter.“When my father saw it, he tore it to pieces,” she said.“We were only 12!”The media swooned.Further south, the barrio becomes more residential.A small breeze hits us as we climb uphill.We walk by several freshly painted colonial-style houses with well-tended patios.The Pope’s father was an accountant and was comfortably off.At Membrillar 531 we find the house where Jorge Bergoglio spent his youth.As a marker of the Pope’s past it scores high in disappointment, because it’s been comprehensively rebuilt.The Buenos Aires Tourist Board must have been greatly relieved when the more photogenic Varela residence was discovered.The birth place of Pope Francis.Soccer saintsOpposite there is a square where Pope Francis played soccer as a kid.He’s still a card-carrying fan of his local team San Lorenzo de Almagro (nickname: The Saints).After his election San Lorenzo wore his image on their shirts for the next match.They won 1-0 after their opponents scored an own goal.No one here doubts it was a miracle.The final stop blessed by the presence of Pope Francis is the kindergarten in the Misericordia College.This is where he had his first communion and learned to count to 10, jumping down the entrance steps.“He returned to the college afterward as archbishop of Buenos Aires”, says Vega.“They still remember how he helped wash the dishes”.It’s probably because of memories like these that Pope Francis has his own tour.
Archive for the ‘ARGENTINE UPDATE’ Category
How I destroyed myself in Argentina
1. I immediately fell for the charms of achamuyero.
Eyes rimmed with ridiculously long, dark eyelashes, matched with charming, easy smiles and a tirade of compliments and attention in smooth Castellano, all boiling down to how I am a gorgeous princess — there’s only so much of an Argentine chamuyero’s tactics a girl who is not a robot can resist.
2. I followed that by drinking too much vino tinto.
If one can get four bottles of decent Malbec for a grand total of less than $10US, why would anyone ever drink water in Argentina?
3. Accompanied by too much carne…
Numerous asados, choripanes, salchichas, chorizos, vacíos, and matambreslater my body was begging me to become a Hindu, worshiping cows and never touching beef again.
4. I didn’t use the dollar blue.
I went into Ezeiza with my VISA card and without a single American dollar in my pocket thinking I would survive by withdrawing money from the ATMs. I ended getting charged 50 pesos by Link or Banelco and another 50 by my own bank for every withdrawal. Bad business for the budget, to say the least. Every transaction cost me the equivalent of two cones of Volta dulce de leche helado.
5. I didn’t bring enough dollars.
So I can pay up to 50% less for a bife de lomo if I exchange dollars to pesos on the black market? I was on the first Buquebus to Colonia, Uruguay and joined the ATM line of Argentinians fortunate enough to have a Miami bank account. I just didn’t withdraw enough and was back to using the pricey cajero a month later…
6. I crossed the border to Chile thinking it might be better there.
I stepped on the bus to Osorno from the bus terminal in Bariloche and passed through pine-filled mountains, went through stunning Villa La Angostura, and didn’t know better than to not get off at that last station before the border. The bus drove up the serpentine road in the Patagonian no-man’s land between the two borders and I finally reached Osorno, Chile with an unimpressed smile on my face. I went running back to Argentina the same day.
7. I became much too acquainted with Fernetand Coke.
I drank way too much of this intensely herb-like cough syrup-tasting alcohol in 2 litre plastic Coca-Cola bottles with their edges softened by lighters and passed around by smiling Cordobeses. Worst part? After a few, they actually begin to taste good.
8. I tried to out-party the porteños.
I mastered the art of siestas at 3 pm, had long dinners on Av. Rodriguez Peña in Recoleta, and drank Coca-Cola to let the caffeine keep me awake until at least 5am. I was still tired by 4 am and went to my morning Spanish class with bags under my eyes hanging down to my feet.
9. I bussed my way from Buenos Aires to El Calafate to save money.
52 hours, ten Adam Sandler movies dubbed into Spanish, and around 9alfajores> later, I arrived. I took the 3-hour flight back.
10. I turned up at the bus station assuming everything would work.
I had my VISA in hand, no pesos, and wanted to get the last bus back from La Cumbre to Retiro, Buenos Aires. The woman behind the glass counter informed me the computer system was down and she couldn’t accept card payment. Three different ATMs, a desperate phone call to my mum, and one stress-induced stomach ache later I was able to board the bus.
Note to self: 24-hour bus strikes, ATMs refusing to spit out money, and system failures are normal things in Argentina. Plan ahead and carry cash.
11. I left thinking my love affair with the country was over.
Yeah, right. This country has a way of destroying people and yet we come running back for more.
Greece Chronicle of a Default Foretold, Again
James A. Hanson firstname.lastname@example.org July 3, 2015
Greece joined the European Union 1981; it was initially rejected by the Euro-Zone but then admitted in 2001. Some analysts felt Greek accounts were inaccurately reported at the time with the help of foreign banks, more do now.
Admission to the Euro-zone probably reduced interest rates for Greece borrowing, albeit in a hard currency. Investors got Euro-denominated bonds and probably felt the discipline of the Euro-zone would work. Greece borrowed heavily.
After 2009, Greece underwent a bailout from the EU and an austerity program from the IMF and the Euro-zone. Greece largely defaulted on its privately-held debt, as it had on-and-off in the 20thcentury. As some observers noted, this approach left most of Greece’s debt in the hands of the EU, the European Central Bank, and the IMF; entities that generally do not accept defaults.
Greece has once again been unable to comply with the (externally imposed) austerity plan, although it did manage briefly to generate a small primary fiscal surplus, i.e., excluding interest payments by the government.
Recently, a run started on Greek banks, which led to a) borrowings from the European Central Bank, then b) a cutoff of these funds, and c) last week, Greece’s closure of its banks and imposition of capital controls. Greece was unable to make a payment due to the IMF on June 30. Other countries have gone into arrears with the IMF, but never a developed country. Other countries with arrears to the IMF currently include Zimbabwe, Sudan and Somalia.
What’s next? Greece has decreed a July 5 referendum on the EU proposals for a follow-up austerity program with another bailout. The likely outcome of the referendum is unclear. But a NO, or even a Yes, could well end-up with Greece’s exit from the Euro and a return to its former currency, a new-Drachma. The currency would depreciate sharply against the Euro, and increase the ratio of external debt to GDP substantially, which already cannot be repaid on time. The increase would depend on whatever reductions are given by the creditors (the IMF will not reduce its loans). But the depreciation may improve the sales of Greece’s exports of goods and services (mainly tourism and shipping). Export gains were limited under the Euro since austerity did not drive down Greek costs in measured in Euros.
Greek banks also will need some clean-up, since they held Greek government bonds that will be converted to new Drachma. How this conversion affects them will depend on how much bank deposits are written down when converted to Drachma, compared to bonds, and how much debt they will owe to the European Central Bank that is not taken over by the Government.
All in all this looks something like Argentina’s leaving the dollar in 2001. The immediate effect on Argentina was a large drop in GDP, but then Argentina grew substantially from 2003-2007, in a commodity based boom. Whether anything like a boom in exports of goods and services could occur in Greece, where the main exports of goods and services are services (tourism and shipping), is unclear. Tourism capacity is unlikely to grow much, but raising prices in new-Drachma to the previous level in Euros might yield some increase in incomes from tourism, measured in new-Drachma.
THURSDAY, July 2, 2015
- ARGENTINA RECALLS ITS FINANCIAL CRISIS, ADVISES GREECE (The Washington Post)
By Paul Byrne
July 1, 2015
BUENOS AIRES, Argentina — As Argentines closely watch the financial turmoil in Greece recalling their own worst crisis 14 years ago, the architect of the South American country’s recovery has a message for the European nation: Renegotiate your debt.
Greece is in a financial limbo now that its bailout program has expired, cutting it off from vital financing and pushing it one step closer to leaving the euro. The country has put limits on cash withdrawals in order to keep banks from collapsing.
Its situation was further worsened Tuesday when it failed to repay a $1.8 billion debt to the International Monetary Fund, the first developed country to do so.
Former Argentine Economy Minister Roberto Lavagna is credited with playing a key role in his country’s recovery after its $100 billion debt default in 2001. He said Tuesday that a “strong restructuring” of its debt is the way to help Greece come out of its crisis and avoid conflict within the European Union.
“It’s not the definitive condition … but it is necessary” to avoid a political conflict, Lavagna told The Associated Press. “Democracy is worth more than markets.”
Lavagna who was economy minister in 2002-05, led Argentina’s recovery from the 2002 recession, considered by many the worst in the country’s history, and spearheaded its 2005 debt restructuring.
Argentina’s financial collapse was so bad that one of every five Argentines was out of work. The peso, which had been tied to the dollar, lost nearly 70 percent of its value, and banks froze deposits and barricaded behind sheet metal as thousands of protesters unsuccessfully tried to withdraw their savings.
Lavagna said the demonstrations in Greece “are way more peaceful” than in Argentina, where at least 27 people died in protests and looting in December 2001 as the economy unraveled. He said that at the time, Argentina also lacked international support and didn’t have the obligations of an economic union like the European Union.
- MAP: GREECE ISN’T THE FIRST NATION TO DEFAULT ON A SOVEREIGN DEBT (The Washington Post )
By Rick Noack
July 1, 2015
After Greece defaulted on a payment to the International Monetary Fund on Wednesday, Prime Minister Alexis Tsipras signaled that he may accept bailout terms outlined by the country’s creditors. It’s not the first time that Greece has defaulted on its sovereign debts: In 2012, it did so twice. This time, the repercussions could be much worse as international creditors are unlikely to save the country from being forced to leave the euro zone and return to the Greek drachma.
Nobody really knows the consequences of a “Grexit,” but since 1998, at least 16 sovereign bond issuers have defaulted, according to ratings agency Moody’s. Apart from Greece, there are four other countries that have defaulted twice in the last 17 years: Ecuador, Jamaica, Belize and Argentina.
The Moody’s list only takes into account recently defaulted sovereign bond issuers. Sudan, Somalia and Zimbabwe have been in default to the IMF for several years or decades, as well, and continue to do so. Sudan started defaulting to the IMF in 1984, according to an extensive database collected by the Bank of Canada, which is why it is not included on the map above that focuses on defaults that started after 1998.
Can Greece learn from previous defaults?
A closer look at recent and more historical incidents of states being unable to fulfill their financial obligations reveals that the Greek case is indeed unique.
Argentina is most frequently brought up in discussions on the potential effects of a Greek default. Asked about the lessons for Greece, Domingo Cavallo, who was Argentina’s economics minister when that nation defaulted in 2001, told the BBC: “Defaulting not only on the foreign debts but also on the domestic debts and all foreign contracts at the beginning of 2002 was really a tragedy for Argentina.”
In 2014, Argentina became a defaulted sovereign bond issuer for the second time in only 15 years. (Reuters)
The default’s repercussions were devastating: More than half of all Argentines lived in poverty in 2003. Inflation and unemployment rose sharply. Despite the dramatic consequences for Argentines, the default appears to have had a limited impact on other economies. “Argentina’s sovereign default in 2001 was then the largest ever, and yet even it did not provoke contagion in global markets,” the Financial Times concluded last year when Argentina faced yet another default.
But Argentina was not part of a currency union such as the euro zone. Furthermore, Greece is geopolitically significant, given its NATO membership and its proximity to the Middle East.
Somewhat less momentous was Russia’s experience in the late 1990s. When oil prices dropped in 1997, Russian exports plummeted and caused a budgetary crisis. Despite an IMF loan, Russia later defaulted on its domestic as well as foreign obligations. It took until 2000 to restructure the Russian debts.
The situation became so dire that Russia had to demand humanitarian aid. Rising oil prices helped the country overcome its crisis soon afterward. Greece, however, only has limited access to valuable natural resources, and its manufacturing sector is weak. Tourism, one of the country’s few reliable revenue streams, would likely suffer from a euro zone exit.
Other countries that have recently defaulted on sovereign debt include Pakistan, Ukraine, Ivory Coast, Moldova, Uruguay, Nicaragua, Grenada, the Dominican Republic, the Seychelles and Cyprus.
That sounds like a lot of defaults, but according to research by the Bank of Canada, the share of total sovereign debt in default out of world public debt or world GDP has sunk since reaching a peak in the 1980s.
Since 1800, Germany has defaulted four times
What appears striking is that some of the countries that have been particularly tough on Greek debts have faced the same fate over the last two centuries. Spain, for instance, has defaulted six times.
And Germany — Europe’s leading economy, which has been especially been keen on enforcing austerity in countries such as Greece, Spain and Portugal — has defaulted four times over the last two centuries. Perhaps their experience proves countries can come back from a default, given time.
- ARGENTINES’ POINTERS FOR GREEKS: GET CASH, BUT DON’T RUSH TO EXIT (Reuters News)
By Richard Lough and Nicolás Misculin
July 1, 2015
(Reuters) – For shell-shocked Greeks struggling with temporarily shuttered banks, long lines at ATMs and limits on withdrawals, Argentines who survived similar financial chaos more than a decade ago have some guidance.
“The advice I would give is to go get your money out of the bank,” said Leo Suckewer, a Buenos Aires restaurant operator, recalling Argentina’s “corralito”, or freeze, on bank accounts in late 2001, aimed at halting a run on banks.
That move preceded the decision to abandon pegging the peso to the dollar as well as convert savers’ dollar holdings into local currency. The radical policies plunged millions of Argentines into poverty as the economy contracted violently after three years of steady decline and triggered deadly rioting, the fall of the government and Argentina’s record default on $100 billion of sovereign debt.
But within a year from a sharp devaluation in early 2002 the country returned to economic growth – something that Greece must now crave, with its economy shrinking by more than 25 percent since 2009.
There are striking similarities between the Argentine economic crisis of 2001-2002 and the turmoil in Greece: rigid monetary regimes, creditors battling against domestic politics to fix the problem and banking systems at breaking point.
On Tuesday, German Chancellor Angela Merkel ruled out new negotiations with Greece until after it votes on a bailout proposal by creditors. That left Athens virtually no hope to avert a midnight default, and could set Greece on a path out of the euro.
Some economists argue that Greeks might be better off going back to its old drachma currency as it would allow Athens to spend more freely and point to Argentina’s rapid recovery from the brink of collapse.
Riding an export boom for commodities such as soybeans and spending heavily to fuel consumer demand, Argentina became one of the fastest growing economies in the Americas with growth averaging above 8.5 percent annually between 2003 and 2007.
NO RUSH TO “GREXIT”
Yet Roberto Lavagna, Argentina’s economy minister in 2002-2005 and architect of its recovery, said it was too early for Greece to consider ditching the single currency.
“Devaluation is not the central issue today, because it means leaving the euro. I don’t think that is necessary.”
He said, however, that creditors had to accept that Greek debt “had reached a point where it has to be restructured” and that further belt-tightening made no sense.
“Greece cannot afford to be sucked into austerity reforms,” Lavagna told Reuters. “On the contrary, it needs to boost productivity which is what we did back then.”
One thing that Greece does not have is an export cash cow that helped Argentina ride out of its slump.
Domingo Cavallo the former economy minister who imposed Argentina’s “corralito” but lost his job before the peso devaluation a month later, warned Greece against leaving the single currency.
“The exit of Greece from the euro zone … would produce a sharp devaluation of the drachma,” Cavallo wrote in a blog this week. “Inflation would follow and it would generate a sharp reduction of real wages and pensions.”
Cavallo said such a drop would be worse than declines resulting from a negotiated bailout package.
FINANCIAL SYSTEM COLLAPSE
In any case, Greeks may need to brace for more pain.
Argentina spiraled deeper into economic, political and social chaos after its “corralito” was imposed. It was a period that saw five presidents in two weeks. Crowds of young, educated Argentines emigrated to their grandparents’ ancestral homes in Europe.
In 2002, the economy shrank 11 percent.
“The collapse in the financial system was in part a result of the default but also to a large extent because the government was forced to turn dollar deposits into pesos. Many of the banks had negative capital,” said Alejo Costa at investment bank Puente in Buenos Aires.
“And the financial system collapse led to a collapse in production. That will be the biggest concern to Greece.”
To avoid its own banking collapse, Athens needed to persuade creditors to restructure its debt and lower the purchasing power of Greeks by cutting salaries.
“Then you will have deflation and you will regain competitiveness without leaving the euro, without an exchange rate devaluation,” Costa said. “But that is extremely difficult to sell to the public.”
Greek Prime Minister Alexis Tsipras blames German-driven austerity for his country’s economic crisis and has steadfastly refused to meet creditors’ demands for further belt tightening, in particular on pensions, in return for a bailout.
The “corralito” and subsequent devaluation still haunt Argentines, who more than a decade on hold scant faith in the peso. Many express sympathy for the Greeks.
“We were saved by soy,” said Walter Lorenzo, a 57-year-old television studio technician. “What’s going to save them? Fishing?”
- ARGENTINA LOCAL BONDS: SMALL SIGNS OF SUCCESS? (Barron’s Blog)
By Dimitra DeFotis
July 1, 2015
With successful international bonds issued by the city and province of Buenos Aires as examples, Fitch Ratings thinks local Argentine governments can refinance and issue more debt in the near term.
The Province of Buenos Aires recently issued a $500 million note denominated in dollars due in 2021 that accrues a fixed 9.95% rate, allowing the province to exchange $375.4 million in debt maturing in October. The use: infrastructure projects. And in February, Buenos Aires also issued a $500 million bond under a $2.3 billion medium-term note program, allowing the city to roll over debt that would have matured this year.
Fitch writes that several other provinces are exploring international debt issuance to refinance with longer maturities, while raising funds for infrastructure. But, Fitch adds, many of these issuances are exposed to foreign currency — especially dollars. The caveat, writes Fitch’s Humberto Panti Garza:
“According to the Fiscal Responsibility Law, any debt should be authorized by the sovereign. This may affect the process, due to authorization delays or if the amounts requested are not authorized. Except for San Luis, La Pampa and the CBA, all other state and local governments have adhered to this law. Despite international investor interest, the process could be complex and time consuming, as it requires political negotiations with the sovereign.”
Argentina defaulted on its debt in 2001, leading to a doubling of unemployment, a spike in inflation, and a weak economy that resulted in half of Argentines living in poverty. It restructured most of its debt, but some holdouts didn’t agree to the terms. With a presidential election this fall, however, the issue of “vulture” funds wanting to be made whole following the default and subsequent agreements is on the back burner. For background on Argentina’s debt restructuring, see our free post, “Argentina Bonds: A Bargain In Disguise?” Also see the BBC story, “What Can Greece Learn From Argentina’s Default?” and our free post, “Argentina’s Take On U.S. “Vulture” Bond Investors.”
As for Argentine equities, Petrobras Argentina (PZE) has been the year’s big winner, up nearly 29% in dollar terms, while bank and insurance holding company Grupo Financiero Galicia (GGAL) is up nearly 16%. The Global X MSCI Argentina ETF (ARGT) is up nearly 6% this year.
MONDAY, July 6, 2015
The President Honors the Life of Reverend Clementa Pinckn
- U.S. WILL OPEN BEEF IMPORT WITH NORTHERN ARGENTINA AND 14 BRAZILIAN STATES (Greeley Tribune (Tribune Content Agency))
- CONSERVATIVE ARGENTINE CANDIDATE WINS 1ST ROUND OF ELECTION (The Washington Post)
July 5, 2015
BUENOS AIRES, Argentina — A Buenos Aires mayoral candidate aligned with Argentina’s top opposition presidential contender has won the first round of city elections.
With 92 percent of election places reporting late Sunday, Horacio Rodriguez Larreta had 45 percent of the vote. Less than 50 percent will mean a runoff in two weeks between Rodriguez and Martin Lousteau, who got 25 percent of the vote.
Larreta, from the Republican Proposal party, is Cabinet chief for Mauricio Macri, the out-going mayor of Buenos Aires who is the top opposition contender for the presidential contest in October.
The results show Macri’s party continues to enjoy wide support in Argentina’s largest city. Macri has been mayor since 2007.
Sunday’s elections included governor and legislator spots in a handful of places across Argentina, including Cordoba.
- ARGENTINE JUDGES ALLOWED TO RESIGN AFTER CHILD ABUSE RULING (The New York Times)
By Jonathan Gilbert
5 July 2015
BUENOS AIRES — Two Argentine judges whose controversial decision to reduce the sentence of a convicted child abuser provoked widespread anger here have had their resignations accepted, Argentina’s state news agency reported on Saturday.
The judges, Horacio Piombo and Benjamín Sal Llargués, reduced the sentence because they claimed that the 6-year-old victim, a boy, had already displayed homosexual tendencies. They were allowed to step down by Daniel Scioli, the governor of Buenos Aires Province, according to Télam, the news agency.
The revelation of the judges’ ruling infuriated Argentines, especially gay and human rights groups. The federal government’s cabinet chief said it was ”one of the greatest barbarities seen in our country.” The decision by Judges Piombo and Sal Llargués to halve the abuser’s sentence was taken last year in the province’s criminal appeals court, but it only came to light recently.
The sentence of Mario Tolosa, the vice president of a sports club who several years ago had raped the boy, a junior soccer player, was cut from six years to a little more than three. Local news reports said Mr. Tolosa had already been released from prison.
The judges based their ruling on what they said was the boy’s sexual disposition, suggesting that he had homosexual leanings. In a television interview, Judge Piombo also justified the ruling by explaining that previous sexual abuse suffered by the boy at the hands of his father had rendered Mr. Tolosa’s offense less severe. The boy’s family has denied that his father ever sexually abused him. Judges Piombo and Sal Llargués were also fired as university professors after protests by students.
Some politicians had requested that Mr. Scioli, who is also running this year for president, refuse the judges’ resignations so that an impeachment process, propelled by gay rights groups and politicians, could take its course. If the judges were impeached, the politicians argued, they might not have been entitled to pension benefits. After Mr. Scioli’s acceptance, however, the judges will be able to claim the benefits, Télam reported.
The judges had previously faced controversy when they halved the sentence of another convicted child abuser, a pastor, in 2011, paving the way for his immediate release from prison.
- ARGENTINE OPPOSITION SET TO KEEP BUENOS AIRES CITY HALL (Reuters News)
By Jorge Otaola
5 July 2015
BUENOS AIRES, July 5 (Reuters) – Argentina’s business-friendly PRO party won Sunday’s mayoral election in the capital Buenos Aires by 20 percentage points, but failed to capture enough votes to avoid a run-off with the No. 2 contender later this month, official returns showed.
With 91.4 percent of the vote counted Horacio Rodríguez Larreta, chief of staff to outgoing mayor and presidential candidate Mauricio Macri, won 45.6 percent of ballots cast.
He needed to break the 50-percent mark to avoid a second round of voting, which will take place July 19.
Still, Larreta’s relatively strong showing was positive for Macri, who will have to carry the city by a wide margin if he is to win the presidency in the October general election. Buenos Aires accounts for about 8 percent of Argentina’s national vote.
“I’d like thank the leader of this team, Mauricio Macri, who we are all sure will be the next president,” Larreta told his supporters in a televised speech.
In second place was Martin Lousteau with 25.6 percent of the vote. The former economy minister represents the ECO party, which is also opposed to outgoing President Cristina Fernandez.
In third place was Mariano Recalde, who heads state-controlled airline Aerolineas Argentinas and represents Fernandez’s Front for Victory party. He got 21.8 percent.
“If there’s a loser here, it’s the Front for Victory, which didn’t even make it to the run-off,” said Ignacio Labaqui, who analyses Argentina for Medley Global Advisors.
Fernandez is constitutionally barred from seeking a third consecutive term in October. For president she has endorsed Buenos Aires Governor Daniel Scioli, who is running several points ahead of Macri in the opinion polls.
Fernandez, widely admired for her political skills but faulted by big business for imposing a web of currency and trade controls that have hurt the economy, may run for president again in 2019.
She backs a slate of congressional candidates in the October general election led by Economy Minister Axel Kicillof and her son, Maximo Kirchner, who heads Fernandez’s “Campora” youth activist organization.
Macri vows he will immediately remove controls and open the economy to attract investment. Scioli also has a more orthodox approach to policy than Fernandez. But any attempts at policy reform could be complicated by the Front for Victory, which is expected to keep control of Congress.
- ARGENTINA’S FERNANDEZ CELEBRATES GREECE’S “NO” TO CREDITORS (Reuters News)
By Hugh Bronstein
July 5, 2015
World markets may tremble at Sunday’s decision by Greek voters to reject conditions of a rescue deal from creditors, but the leader of Argentina, which suffered a similar crisis more than a decade ago, boldly welcomed the referendum result.
President Cristina Fernandez, known for combatively defending her unorthodox policies, tweeted that Greece’s vote marked “a resounding victory for democracy and dignity.”
There are stark similarities between Argentina’s 2002 financial meltdown and the turmoil in Greece: rigid monetary regimes, creditors battling domestic politics to fix the problem and banking systems at breaking point.
In Greece, 61 percent of voters rejected a deal that would have imposed more austerity on their already ravaged economy.
“The Greek people have said ‘NO’ … to the impossible and humiliating conditions that would be imposed for the restructuring of their debt,” she tweeted. “We Argentines know what this is about. We hope that Europe and its leaders understand the message … that you can’t force anyone to sign their own death warrant.”
The South American grains behemoth defaulted on $100 billion in bonds in a 2002 crisis that thrust millions of middle-class Argentines into poverty. By the next year, helped by a massive soy crop, Argentina started growing again.
But the 2002 crisis continues to plague its finances.
Fernandez regularly blasts bondholders who have sued the country over the debt it failed to pay 13 years ago.
Most holders agreed to restructurings that paid about 30 cents on the dollar, while a group of hedge funds sued for full repayment.
The country defaulted again last year when a U.S. judge barred it from honoring its restructured debt without reaching a deal with the funds, which Fernandez denounces as “vultures.”
Argentina became one of the world’s fastest expanding economies after its default, growing at an averaging above 8.5 percent between 2003 and 2007, when Fernandez was first elected.
Since then she has ordered trade and currency controls that have slowed investment while government fiscal accounts deteriorate due to high state spending.
- GREEK DEBT BETTER SHIELDED FROM VULTURES THAN ARGENTINA’S (Reuters News)
By John Geddie and Marius Zaharia
July 3, 2015
* Most Greek bonds have clauses making restructuring easier
* Investor would need to spend large sums to hold out
* Risks remain as lawyers point to ways around CACs
LONDON, July 3 (Reuters) – Greece might be spared the decade-long legal battles Argentina faced if it ends up restructuring its debt, although lawyers say vulture funds might still hold Athens to ransom.
The structure of Athens’ debt and the use of contract clauses that make it easier for countries to impose losses on bondholders should protect the country from litigious “hold-out” investors, although experts warn they are not fool-proof.
Greece, the first developed country to default on an International Monetary Fund loan, has seen the value of its bonds collapse on fears it is headed for a repeat of 2012, when it wrote down its debt. Greeks will vote on Sunday in a referendum that could ultimately see it leave the euro zone.
But brokers say there are no signs yet of distressed debt investors that prey on bankrupt countries – and have hauled the likes of Argentina through the courts – hovering over Greece.
“There is a small risk that there could be holdout law suits, but nothing like Argentina,” said Starla Griffin of Slaney Advisors, a lawyer and member of the Expert Group on Sovereign Debt Restructuring sponsored by the United Nations.
Argentina, whose debt was not protected by such clauses when it defaulted in 2002, is still in a legal battle with holdouts, including Elliott Management’s affiliate, NML Capital Ltd, and Aurelius Capital Management.
Investors aiming to stay out of any further Greek debt writedown and get more of their money back would first have to thwart collective action clauses (CACs). Those clauses are written into about 33 billion euros of Greek bonds issued in 2012 as part of the restructuring and into around 6 billion euros of 2017 and 2019 bonds issued last year.
The former – handed to investors in a process called Private Sector Involvement in exchange for older bonds – are even better protected, because they are treated as one series.
For a debt restructuring to be enforced on all those bonds, investors holding at least two-thirds of the outstanding bonds need to vote, and 75 percent of those voting need to back it.
That means holdouts would have to build a stake of some 5.5 billion euros across all the bonds, rather than a smaller stake in only one of them, to have a chance of success.
“For a significant amendment to the terms of the PSI notes, the quorum will be two-thirds, but with 25 percent you can block any proposal of this type, given that they require 75 per cent approval to pass,” said Arjun Muddu, an associate at Linklaters, who acted for banks mediating the 2012 restructuring.
Japonica Partners says it is one of the largest holders of Greek government debt, and launched a tender to buy up to 4 billion euros of these bonds in 2013. If Greek bond prices fall further, the firm might be able to build a blocking stake. Reuters has not been able to confirm Japonica holdings of Greek debt in conversations with traders and other investors or on bond databases.
The two Greek bonds issued in 2014 also have CACs, but they are different. They allow for a vote on each bond, meaning investors need less money to build a blocking stake.
After a U.S. court ruling that forced Argentina into another default last year, the IMF called for CACs to require only a single vote across all affected bonds rather than multiple votes on each one. A single vote would make it easier to impose a writedown.
That approach has been endorsed in Europe by the International Capital Markets Association, but it may have come too late for Greece.
“The two-limbed requirement makes life for holdouts more difficult, but CACs are not watertight and in theory holdouts can still block a restructuring with a large and diverse majority,” said Dania Thomas, business law lecturer at Glasgow University.
There is precedent in Greece for holdouts. Athens still has around 4 billion euros of old, unrestructured bonds, but has so far honoured payments on such debt and avoided court action.
But even if investors are pushed into future haircuts, the legal battles may not be over.
Christian Leathley, an international arbitration lawyer at Herbert Smith Freehills, said that if investors could not get a blocking stake in any future restructuring, they might still be able to pursue a claim against the sovereign under an applicable bilateral investment treaty.
Herbert Smith Freehills pursued bondholder claims arising out of Argentina in U.S. court enforcement actions.
“Even though under the bond you were basically strong-armed into accepting this arrangement, that might not necessarily preclude you from bringing a claim under a treaty,” said Leathley.
“No matter what the best intention is … there could be some quite lengthy litigation that follows through these international arbitral tribunals.”
Greece has signed around 40 such treaties with other countries, including Germany, according to the United Nations.
- MACRI PROTEGE’S WIN IN BUENOS AIRES NOT ENOUGH TO AVOID RUN-OFF (Bloomberg News)
By Charlie Devereux
July 5, 2015
Opposition presidential hopeful Mauricio Macri saw his candidate win by a comfortable margin in elections for mayor of Buenos Aires, while failing to avoid a run-off.
Horacio Rodriguez Larreta of Macri’s PRO party had 45.6 percent of votes against 25.6 percent for the ECO alliance’s Martin Lousteau and 21.8 percent for Mariano Recalde of the national government’s Victory Front alliance with 92 percent of votes counted, according to the city government. Lousteau said he would compete in a second round, scheduled to take place on July 19, since Larreta failed to gain a majority.
Macri, mayor of the city for two four-year terms, described the election as a plebiscite on his presidential bid as he seeks to end 12 years of government by President Cristina Fernandez de Kirchner and her late husband Nestor Kirchner. The question now is whether Lousteau can attract enough of the votes cast for Fernandez’s Victory Front alliance to overcome Larreta’s 20-point margin.
“This is a clear message of confidence in what we’ve been doing,” Macri said in a speech to supporters after results were announced. “This is part of something much bigger that’s happening in all of the country.”
Lousteau, whose alliance includes members of the Radical Party and the Civic Coalition that is allied with Macri at a national level, denied suggestions by the PRO party that he might decline to contest a run-off.
“Today the residents of Buenos Aires decided that there will be a run-off,” Lousteau told supporters.
“With a run-off, we all win.”
Elections also took place Sunday in Cordoba province, Argentina’s second-largest voting district, and La Rioja province, where not enough votes had been counted to declare a winner. Corrientes province voted for provincial lawmakers and senators while La Pampa province held primaries to choose candidates for governor.
- TIMELINE: ARGENTINA’S PRESIDENTIAL ELECTIONS (Bloomberg News)
By Charlie Devereux
July 2, 2015
Shows voter support for top three candidates using average of various national polls
Argentina’s presidential elections in October will be the first in 12 years that won’t feature President Cristina Fernandez de Kirchner or her late husband Nestor Kirchner as candidate.
* March 15: Radical Civic Union votes to form alliance with main opposition candidate Mauricio Macri
* June 9: Dissident Peronist candidate Sergio Massa says he’ll remain in race and won’t form alliance with Macri
* June 16: Daniel Scioli names Fernandez ally Carlos Zannini as his vice presidential running mate. Stocks, bonds and black market peso tumble on speculation appointment means currency controls and subsidies will be kept in place
* June 20: President Fernandez says she won’t put herself forward for elected office; her son, Maximo Kirchner, will run for lawmaker in Santa Cruz, while Economy Minister Axel Kicillof will stand in city of Buenos Aires
* July 5: Regional election in Buenos Aires where Macri’s candidate Horacio Rodriguez Larreta must see off challenge from former Economy Minister Martin Lousteau. Cordoba, La Rioja and Corrientes provinces also hold elections
* July 10: Official start of campaigning for primaries
* July 19: Possible second round vote for Buenos Aires elections
* Aug. 9: Primaries to choose candidates for president. Candidates for governor, lawmaker and senators for some provinces also chosen **Scioli to run uncontested as ruling FpV alliance candidate **Macri to compete with Ernesto Sanz, Elisa Carrio **Massa to compete with Jose Manuel De la Sota
* Sept. 20: Official start of general election campaign
* Oct. 25: Presidential election. Provinces of Jujuy, Formosa, Catamarca, Misiones, San Juan, San Luis, Entre Rios, Buenos Aires, La Pampa, Chubut and Santa Cruz also hold regional elections **Candidate must win more than 45% or more than 40% with 10ppt margin of victory over rival to avoid second round
* Nov. 22: Possible second round of presidential elections
* Dec. 10: New president sworn in
- OWL CREEK SAID TO NEAR MINIMUM TO ACCELERATE ARGENTINE DEBT (Bloomberg News)
By Katia Porzecanski
July 2, 2015
A creditor group led by Owl Creek Asset Management is on the cusp of controlling enough defaulted Argentine bonds to demand immediate repayment, according to people familiar with the matter.
Jeffrey Altman’s $4.1 billion hedge fund is working with law firm Jones Day to find other holders of the $5.4 billion in so-called par bonds that want to join the group, according to the people, who asked not to be identified because the talks are private. The investors, who need at least 25 percent of a series of notes in order to demand their money right away in a process known as acceleration, are close to reaching that level for one of the bonds, the people said.
Owl Creek first sought to form the group last year after starting its Argentina Recovery Fund in September. The effort initially gained little traction on concern it would protract a legal battle and derail chances of a quick settlement between Argentina and creditors from its 2001 default led by Elliott Management, whose lawsuit has blocked payments on restructured bonds since June 2014.
Patrick Clifford, a spokesman for New York-based Owl Creek at Abernathy Macgregor Group, declined to comment on acceleration efforts. Dave Petrou, a spokesman for Jones Day, didn’t return an e-mail and phone call seeking comment. A press official for Argentina’s economy ministry declined to comment.
In an August presentation for its Argentina-focused fund, Owl Creek said accelerating the par bonds, which mature in 2038 and are the lowest-priced of the restructured bonds, could provide investors with a windfall profit in a subsequent bond swap. The bonds traded at 53.88 cents on the dollar on July 2.
The hedge fund said in its August presentation that accelerating may provide them with a “seat in settlement negotiations” next to Elliott, “likely resulting in an exchange into new bonds which trade closer to par.”
The Argentina Recovery Fund helped lead Owl Creek’s gains through the first quarter of 2015 with an 8.6 percent return over the period, people familiar with the matter said in April. Its main Owl Creek Overseas Fund rose 3.7 percent through March.
Owl Creek opened a second Argentina Recovery Fund in December and a third in June, according to U.S. regulatory filings.
- U.S. WILL OPEN BEEF IMPORT WITH NORTHERN ARGENTINA AND 14 BRAZILIAN STATES (Greeley Tribune (Tribune Content Agency))
By Bridgett Weaver, Greeley Tribune, Colo.
5 July 2015
July 05–Imports of fresh beef will be allowed from northern Argentina and 14 Brazilian states following a final ruling by the U.S. Department of Agriculture’s Animal and Plant Health Inspection Service.
Imports of certain animals and animal products from the areas have been blocked until now to prevent the introduction of diseases to U.S. production, according to Docket No. APHIS-2009-0017, which detailed the case.
The regulations are being amended after a recent risk assessment determined that fresh beef, which means chilled or frozen beef, can be safely imported from areas that meet certain conditions.
Northern Argentina meets the conditions, as well as the Brazilian states of Bahia, Distrito Federal, Espírito Santo, Goiás, Mato Grosso, Mato Grosso do Sul, Minas Gerais, Paraná, Rio Grande do Sul, Rio de Janeiro, Rond”nia, São Paulo, Sergipe and Tocantins.
The ruling comes after many years of trade barriers put up between the regions in question and the U.S., which means the imports are not likely to flood the U.S. market.
“All the infrastructure and that supply chain is going to have to be put into place,” said Brett Boydston, vice president of public policy with the Colorado Farm Bureau.
Boydston said he thinks the ruling is a positive one. It could act as a peace offering between the U.S. and other countries putting up such trade barriers.
“I think an olive branch is a good way to put it,” Boydston said. “I think it sends a big message that when it comes to considerations like this we’re going to use sound science methods to tear down trade barriers.”
Most important, Boydston noted, is that if the U.S. is taking down these barriers, it will prompt other countries to take down similar barriers that are being used against the U.S.
Some producers are concerned that opening trade between the countries will expose U.S. herds to Foot and Mouth Disease, more commonly known as FMD. It is a highly contagious viral disease that affects cattle and sheep. It causes ulcers on the hoofs and around the mouth of the livestock.
The documents cited 870 comments on the allowance of imports.
“Many commentors, citing the highly contagious nature of FMD, expressed the view that we should not allow fresh beef to be imported from any country where the disease is present because regionalization is not likely to mitigate the risks associated with imports effectively. We considered the epidemiological characteristics of FMD,” documents said. “Based on our assessment, we concluded that beef from the exporting region of Brazil could safely be imported into the United States, provided that FMD has not been diagnosed in that region within the past 12 months, that there is no commingling of bovines or beef from that region with animals or beef from other regions…”
Keith Roehr, state veterinarian with the Colorado Department of Agriculture, said he doesn’t think the USDA would put cattle in harm’s way, but there is a lot of opposition to opening the U.S. to these beef imports, including a statement from the National Cattlemen’s Beef Association president stating the organization’s concerns.
“NCBA remains committed to supporting open trade markets, level playing fields, and utilizing science-based standards to facilitate international trade,” according to a statement by the Association. “At the same time, no amount of trade is worth sacrificing the health and safety of the United States cattle herd.”
Roehr said he supports the NCBA’s statement, but he hasn’t actually read the risk assessment and cannot speak to the science behind the agriculture department’s decision.
“I think in the end I would feel the USDA has done what they can,” he said. “In the end, we know the risk is probably pretty small but we know the outcomes of these things is huge.”
He said the risk of introducing FMD in the U.S. is what is concerning to producers.
“We have a disease-free status that other countries don’t.”
JBS USA CEO Andre Nogueira said in a recent meeting with the press he does not understand companies that support the open market when it comes to exports, but not when it comes to imports.
“We love the open market. The open market brings efficiencies. So we cannot believe in an open market when we sell and not believe in an open market when we buy. The open market is the open market,” he said.
Nogueira, who comes from Brazil, said Brazil has a very high standard of beef production and works with some of the most selective global markets.
Bill Rupp, president of JBS USA Beef, said the open market also benefits U.S. consumers when domestic supplies are tight.
“With the drought and the impact of the drought on the cattle herd, we’ve seen the supply of mature cows, which is by and large the foundation of our ground beef supply, those cows were liquidated because of the drought,” Rupp said. “That has been totally compensated for by the input of lean trimming from Australia and New Zealand. The poundage that was lost in the U.S. has been completely offset by fresh, frozen trimmings from Australia and New Zealand.”
Rupp called these imports and example of the marketplace working efficiently, emphasizing that foreign meat supplies play an important role in the U.S. food system.
By Paul ByrneJuly 1, 2015BUENOS AIRES, Argentina — As Argentines closely watch the financial turmoil in Greece recalling their own worst crisis 14 years ago, the architect of the South American country’s recovery has a message for the European nation: Renegotiate your debt.Greece is in a financial limbo now that its bailout program has expired, cutting it off from vital financing and pushing it one step closer to leaving the euro. The country has put limits on cash withdrawals in order to keep banks from collapsing.Its situation was further worsened Tuesday when it failed to repay a $1.8 billion debt to the International Monetary Fund, the first developed country to do so.Former Argentine Economy Minister Roberto Lavagna is credited with playing a key role in his country’s recovery after its $100 billion debt default in 2001. He said Tuesday that a “strong restructuring” of its debt is the way to help Greece come out of its crisis and avoid conflict within the European Union.“It’s not the definitive condition … but it is necessary” to avoid a political conflict, Lavagna told The Associated Press. “Democracy is worth more than markets.”Lavagna who was economy minister in 2002-05, led Argentina’s recovery from the 2002 recession, considered by many the worst in the country’s history, and spearheaded its 2005 debt restructuring.Argentina’s financial collapse was so bad that one of every five Argentines was out of work. The peso, which had been tied to the dollar, lost nearly 70 percent of its value, and banks froze deposits and barricaded behind sheet metal as thousands of protesters unsuccessfully tried to withdraw their savings.Lavagna said the demonstrations in Greece “are way more peaceful” than in Argentina, where at least 27 people died in protests and looting in December 2001 as the economy unraveled. He said that at the time, Argentina also lacked international support and didn’t have the obligations of an economic union like the European Union.‘By Rick NoackJuly 1, 2015After Greece defaulted on a payment to the International Monetary Fund on Wednesday, Prime Minister Alexis Tsipras signaled that he may accept bailout terms outlined by the country’s creditors. It’s not the first time that Greece has defaulted on its sovereign debts: In 2012, it did so twice. This time, the repercussions could be much worse as international creditors are unlikely to save the country from being forced to leave the euro zone and return to the Greek drachma.Nobody really knows the consequences of a “Grexit,” but since 1998, at least 16 sovereign bond issuers have defaulted, according to ratings agency Moody’s. Apart from Greece, there are four other countries that have defaulted twice in the last 17 years: Ecuador, Jamaica, Belize and Argentina.The Moody’s list only takes into account recently defaulted sovereign bond issuers. Sudan, Somalia and Zimbabwe have been in default to the IMF for several years or decades, as well, and continue to do so. Sudan started defaulting to the IMF in 1984, according to an extensive database collected by the Bank of Canada, which is why it is not included on the map above that focuses on defaults that started after 1998.Can Greece learn from previous defaults?A closer look at recent and more historical incidents of states being unable to fulfill their financial obligations reveals that the Greek case is indeed unique.Argentina is most frequently brought up in discussions on the potential effects of a Greek default. Asked about the lessons for Greece, Domingo Cavallo, who was Argentina’s economics minister when that nation defaulted in 2001, told the BBC: “Defaulting not only on the foreign debts but also on the domestic debts and all foreign contracts at the beginning of 2002 was really a tragedy for Argentina.”In 2014, Argentina became a defaulted sovereign bond issuer for the second time in only 15 years. (Reuters)The default’s repercussions were devastating: More than half of all Argentines lived in poverty in 2003. Inflation and unemployment rose sharply. Despite the dramatic consequences for Argentines, the default appears to have had a limited impact on other economies. “Argentina’s sovereign default in 2001 was then the largest ever, and yet even it did not provoke contagion in global markets,” the Financial Times concluded last year when Argentina faced yet another default.But Argentina was not part of a currency union such as the euro zone. Furthermore, Greece is geopolitically significant, given its NATO membership and its proximity to the Middle East.Somewhat less momentous was Russia’s experience in the late 1990s. When oil prices dropped in 1997, Russian exports plummeted and caused a budgetary crisis. Despite an IMF loan, Russia later defaulted on its domestic as well as foreign obligations. It took until 2000 to restructure the Russian debts.The situation became so dire that Russia had to demand humanitarian aid. Rising oil prices helped the country overcome its crisis soon afterward. Greece, however, only has limited access to valuable natural resources, and its manufacturing sector is weak. Tourism, one of the country’s few reliable revenue streams, would likely suffer from a euro zone exit.Other countries that have recently defaulted on sovereign debt include Pakistan, Ukraine, Ivory Coast, Moldova, Uruguay, Nicaragua, Grenada, the Dominican Republic, the Seychelles and Cyprus.That sounds like a lot of defaults, but according to research by the Bank of Canada, the share of total sovereign debt in default out of world public debt or world GDP has sunk since reaching a peak in the 1980s.Since 1800, Germany has defaulted four timesWhat appears striking is that some of the countries that have been particularly tough on Greek debts have faced the same fate over the last two centuries. Spain, for instance, has defaulted six times.And Germany — Europe’s leading economy, which has been especially been keen on enforcing austerity in countries such as Greece, Spain and Portugal — has defaulted four times over the last two centuries. Perhaps their experience proves countries can come back from a default, given time.By Richard Lough and Nicolás MisculinJuly 1, 2015(Reuters) – For shell-shocked Greeks struggling with temporarily shuttered banks, long lines at ATMs and limits on withdrawals, Argentines who survived similar financial chaos more than a decade ago have some guidance.“The advice I would give is to go get your money out of the bank,” said Leo Suckewer, a Buenos Aires restaurant operator, recalling Argentina’s “corralito”, or freeze, on bank accounts in late 2001, aimed at halting a run on banks.That move preceded the decision to abandon pegging the peso to the dollar as well as convert savers’ dollar holdings into local currency. The radical policies plunged millions of Argentines into poverty as the economy contracted violently after three years of steady decline and triggered deadly rioting, the fall of the government and Argentina’s record default on $100 billion of sovereign debt.But within a year from a sharp devaluation in early 2002 the country returned to economic growth – something that Greece must now crave, with its economy shrinking by more than 25 percent since 2009.There are striking similarities between the Argentine economic crisis of 2001-2002 and the turmoil in Greece: rigid monetary regimes, creditors battling against domestic politics to fix the problem and banking systems at breaking point.On Tuesday, German Chancellor Angela Merkel ruled out new negotiations with Greece until after it votes on a bailout proposal by creditors. That left Athens virtually no hope to avert a midnight default, and could set Greece on a path out of the euro.Some economists argue that Greeks might be better off going back to its old drachma currency as it would allow Athens to spend more freely and point to Argentina’s rapid recovery from the brink of collapse.Riding an export boom for commodities such as soybeans and spending heavily to fuel consumer demand, Argentina became one of the fastest growing economies in the Americas with growth averaging above 8.5 percent annually between 2003 and 2007.NO RUSH TO “GREXIT”Yet Roberto Lavagna, Argentina’s economy minister in 2002-2005 and architect of its recovery, said it was too early for Greece to consider ditching the single currency.“Devaluation is not the central issue today, because it means leaving the euro. I don’t think that is necessary.”He said, however, that creditors had to accept that Greek debt “had reached a point where it has to be restructured” and that further belt-tightening made no sense.“Greece cannot afford to be sucked into austerity reforms,” Lavagna told Reuters. “On the contrary, it needs to boost productivity which is what we did back then.”One thing that Greece does not have is an export cash cow that helped Argentina ride out of its slump.Domingo Cavallo the former economy minister who imposed Argentina’s “corralito” but lost his job before the peso devaluation a month later, warned Greece against leaving the single currency.“The exit of Greece from the euro zone … would produce a sharp devaluation of the drachma,” Cavallo wrote in a blog this week. “Inflation would follow and it would generate a sharp reduction of real wages and pensions.”Cavallo said such a drop would be worse than declines resulting from a negotiated bailout package.FINANCIAL SYSTEM COLLAPSEIn any case, Greeks may need to brace for more pain.Argentina spiraled deeper into economic, political and social chaos after its “corralito” was imposed. It was a period that saw five presidents in two weeks. Crowds of young, educated Argentines emigrated to their grandparents’ ancestral homes in Europe.In 2002, the economy shrank 11 percent.“The collapse in the financial system was in part a result of the default but also to a large extent because the government was forced to turn dollar deposits into pesos. Many of the banks had negative capital,” said Alejo Costa at investment bank Puente in Buenos Aires.“And the financial system collapse led to a collapse in production. That will be the biggest concern to Greece.”To avoid its own banking collapse, Athens needed to persuade creditors to restructure its debt and lower the purchasing power of Greeks by cutting salaries.“Then you will have deflation and you will regain competitiveness without leaving the euro, without an exchange rate devaluation,” Costa said. “But that is extremely difficult to sell to the public.”Greek Prime Minister Alexis Tsipras blames German-driven austerity for his country’s economic crisis and has steadfastly refused to meet creditors’ demands for further belt tightening, in particular on pensions, in return for a bailout.The “corralito” and subsequent devaluation still haunt Argentines, who more than a decade on hold scant faith in the peso. Many express sympathy for the Greeks.“We were saved by soy,” said Walter Lorenzo, a 57-year-old television studio technician. “What’s going to save them? Fishing?”By Dimitra DeFotisJuly 1, 2015With successful international bonds issued by the city and province of Buenos Aires as examples, Fitch Ratings thinks local Argentine governments can refinance and issue more debt in the near term.The Province of Buenos Aires recently issued a $500 million note denominated in dollars due in 2021 that accrues a fixed 9.95% rate, allowing the province to exchange $375.4 million in debt maturing in October. The use: infrastructure projects. And in February, Buenos Aires also issued a $500 million bond under a $2.3 billion medium-term note program, allowing the city to roll over debt that would have matured this year.Fitch writes that several other provinces are exploring international debt issuance to refinance with longer maturities, while raising funds for infrastructure. But, Fitch adds, many of these issuances are exposed to foreign currency — especially dollars. The caveat, writes Fitch’s Humberto Panti Garza:“According to the Fiscal Responsibility Law, any debt should be authorized by the sovereign. This may affect the process, due to authorization delays or if the amounts requested are not authorized. Except for San Luis, La Pampa and the CBA, all other state and local governments have adhered to this law. Despite international investor interest, the process could be complex and time consuming, as it requires political negotiations with the sovereign.”Argentina defaulted on its debt in 2001, leading to a doubling of unemployment, a spike in inflation, and a weak economy that resulted in half of Argentines living in poverty. It restructured most of its debt, but some holdouts didn’t agree to the terms. With a presidential election this fall, however, the issue of “vulture” funds wanting to be made whole following the default and subsequent agreements is on the back burner. For background on Argentina’s debt restructuring, see our free post, “Argentina Bonds: A Bargain In Disguise?” Also see the BBC story, “What Can Greece Learn From Argentina’s Default?” and our free post, “Argentina’s Take On U.S. “Vulture” Bond Investors.”As for Argentine equities, Petrobras Argentina (PZE) has been the year’s big winner, up nearly 29% in dollar terms, while bank and insurance holding company Grupo Financiero Galicia (GGAL) is up nearly 16%. The Global X MSCI Argentina ETF (ARGT) is up nearly 6% this year.
Countries, Human Rights Abuses in US Report
A woman reacts as she rests from walking back to Tel Abyad town, Raqqa governorate, after fleeing Maskana town in the Aleppo countryside June 16, 2015. With a string of victories over Islamic State,
Syria: Massacres by government and allied militias, civilian neighborhoods bombarded, prisoner abuse, rape as a weapon of war; attacks on residential areas; creating some 3.2 million refugees and another 7.6 million internally displaced; widespread torture, forced displacement and starvation; increased human trafficking, child soldiers,; similar abuses by terror groups; 900 members of a single tribe executed by Islamic State; group also stoned women and men accused of adultery, crucified civilians, forced people into marriages, raped kidnapped girls, kept women in sexual slavery, beheaded foreign journalists and aid workers, and circulated videos of their crimes on social media.
Iraq: The Islamic State group killed, raped and recruited child soldiers and targeted Shiites; abuses by Shiite militias operating outside government control, including kidnappings, extortion, killings; limits on freedom of expression and peaceful assembly; violence against journalists; restrictions on religious freedom; widespread corruption. More than 2 million displaced during the year.
Saudi Arabia: Human rights activists tried as terrorist suspects; individual executed for “sorcery;” limited religious freedom; restricted women’s rights; activists sentenced to lashes.
Egypt: Excessive force by security and suppression of liberties; little government investigation of abuses; mass trials; expanded jurisdiction of military courts to try civilians; lengthy pre-trial detentions; thousands of protesters arrested, including secular and Islamist activists.
Israel: Civilians targeted by terrorists; religious motivated “societal violence;” institutional discrimination against Arabs, including self-identified Palestinians and Bedouins; unequal access to education, employment; treatment of refugees and migrants; discrimination against non-Orthodox Jews, minority religions, intermarried families.
Bahrain: Protesters arrested on vague charges, tortured; trials of political and human rights activists, students and journalists without due process, resulting in harsh sentences; discrimination against Shiites.
China: Routine repression of rights advocates, minorities and law firms taking sensitive cases; censorship and tight control of Internet; restrictions on freedom of religion; tens of thousands of political prisoners; prosecution of individuals trying to fight corruption and abuses of power; poor labor standards.
North Korea: A human rights record “among the worst in the world;” systematic violations by government, institutions and officials, including crimes against humanity; public executions, disappearances, arbitrary arrests, torture and severe punishment for refugees returning home; “inhuman” prison camps and forced labor.
Myanmar: Violence and discrimination against Rohingya Muslims; unfair citizenship rules; Muslims displaced by violence, restricted in movements, receiving little help to return to homes; killings, arbitrary detentions and torture by security forces; lack of rule and widespread rape in conflict areas.
Pakistan: Extrajudicial killings; harassment of journalists and high-profile attacks on them; limited freedom of religion for minorities; disappearances, torture and frequent mob and sectarian violence; corruption within police; rape, domestic violence, “honor crimes,” discrimination against women and girls; “widespread” human trafficking, child abuse, sexual exploitation; most of nation not covered by labor rules; human rights abuses go unpunished.
Afghanistan: Widespread atrocities by insurgents, including torture, targeted violence against women and girls; extrajudicial killings, arbitrary arrests and prisoner abuse by security forces; women detained for “moral” crimes, subjected to underage and forced marriages; abuses by officials unprosecuted.
Nigeria: More than 4,000 civilians and tens of thousands displaced by Boko Haram attacks; response hampered by high levels of corruption in Nigeria’s military; impunity for abuses, corruption throughout government; violence against women, sexual exploitation of children; discrimination against women and homosexuals based on ethnicity, religion, region, disabilities; forced and bonded labor.
Sudan: Indiscriminate and deliberate bombing of civilian areas in Darfur; attacks on humanitarian facilities; clashes between government forces, militias, rebels resulting in deaths on all sides; civilian areas shelled by armed opposition, too; opposition, civil society members arrested.
South Sudan: 10,000 children used as fighters in civil war; more than 1.5 people displaced in “one of the world’s worst humanitarian disasters’” ethnically targeted killings, rapes by both sides; journalists, political opponents intimidated; U.N. staff and NGOs restricted in movements, harassed; widespread violence against women and children; pervasive corruption, impunity.
Russia: Increasingly authoritarian system; new repressive laws to stop dissent and harass activists, media and other independent voices; in Crimea, members of Tatar community and other religious minorities opposing occupation persecuted; in eastern Ukraine, Russian forces and allied separatists shelled urban areas and committed abductions; widespread corruption throughout all levels of government.
Turkey: Weak justice system, politicized law enforcement, prosecutors suspended for investigating corruption of government officials, evidence destroyed; few prosecutions for excessive force leading to deaths of demonstrators; journalists jailed; individuals vilified for political, religious, cultural views; discrimination against Kurds, Roma, women, children, homosexuals; honor killings, child marriage; poor prison conditions; rise in anti-Semitism among political leaders and pro-government media.
Venezuela: Crackdown on protesters, including detentions, torture, imprisonment; opposition figures jailed, media blocked, journalists harassed and intimidated through fines, property seizures, criminal investigations; political opponents prosecuted, harassed, intimidated, imprisoned.
1. ARGENTINA’S TOP CRIMINAL COURT REJECTS VICE PRESIDENT’S ATTEMPT TO THROW OUT BRIBERY CASE (The Washington Post)
2. AN ECHO OF ARGENTINA IN GREEK DEBT CRISIS (The New York Times)
3. KRUGMAN CRITICIZED BY BIGGEST BANK IN BALTICS FOR ARGENTINA JIBE (Bloomberg News)
4. EVERYONE WHO WAS HOPING THAT ARGENTINA’S BALONEY WOULD END NEXT YEAR JUST GOT HOSED (Businessinsider)
5. ARGENTINA: CURRENCY FORECAST (Economist Intelligence Unit – ViewsWire)
1. ARGENTINA’S TOP CRIMINAL COURT REJECTS VICE PRESIDENT’S ATTEMPT TO THROW OUT BRIBERY CASE (The Washington Post)
June 25, 2015
BUENOS AIRES, Argentina – Argentina’s highest criminal court has rejected attempts by the country’s vice president to throw out a bribery case against him.
The Federal Chamber of Criminal Appeals on Thursday confirmed the case against Vice President Amando Boudou. The decision will send Boudou’s case to trial, which would likely be scheduled for next year.
While heading the Economy Ministry in 2010, Boudou allegedly instructed the South American nation’s tax bureau to give the Ciccone printing house an exceptional moratorium to refinance debts amid a bankruptcy.
Boudou has said that he is innocent and that he is being persecuted by political opponents. He has continued in his post, but is not running for any office during the national elections in October.
2. AN ECHO OF ARGENTINA IN GREEK DEBT CRISIS (The New York Times)
By James B. Stewart
June 25, 2015
There may be a one-word explanation for why Greece will ultimately capitulate to European demands for more austerity:
Greece is hardly the first nation to face the prospect of defaulting on its sovereign debt obligations. Argentina has defaulted on its external debt no fewer than seven times since gaining independence in 1816, most recently last year. But it’s Argentina’s 2001 default on nearly $100 billion in sovereign debt, the largest at the time, that poses a cautionary example for Greece.
Should Greece default, “Argentina is an apt analogy,” said Arturo C. Porzecanski, a specialist in international finance at American University and author of numerous papers on Argentina’s default. But for Greece, “It would likely be worse. Argentina was comparatively lucky.”
Daniel Gros, director of the Center for European Policy Studies in Brussels and the author of “A Tale of Two Defaults,” a paper comparing Greece and Argentina, agreed. “Default would be much worse for Greece than it was for Argentina,” he said.
Like Greece today, Argentina had endured several years of hardship and austerity by 2001. It borrowed heavily from the International Monetary Fund, the World Bank and the United States, all of which demanded unpopular spending cuts. The I.M.F. withheld payments when Argentina (like Greece) failed to meet its deficit targets. A bank run led the government to freeze deposits, which set off riots and street demonstrations. There were deadly confrontations between police and demonstrators in the heart of Buenos Aires, and the president at the time, Fernando de la Rúa, fled the country by helicopter in December. In the last week of 2001, Argentina defaulted on $93 billion in sovereign debt and subsequently sharply devalued the peso, which had been pegged to the dollar.
In addition to social unrest and a wave of political instability (at one point, the country had three presidents in four days), Argentina’s economy plunged into depression. Tens of thousands of the unemployed scavenged the streets collecting cardboard, an enduring image that gave rise to the term “cartoneros.” Dollar-denominated deposits were converted to pesos, wiping out over half their purchasing power.
Despite this trauma, the Argentine economy stabilized in 2002. The country was able to repay the I.M.F. in full by 2006. But the country has never re-entered the international debt markets. It has refused to comply with a ruling by a United States federal court judge that the country must repay in full private creditors who did not participate in the country’s debt restructuring. As a result, Argentina defaulted again last year, and the standoff continues.
Even without much external financing, Argentina’s economy has fared relatively well since 2002, leading some economists, notably Mark Weisbrot of the Center for Economic and Policy Research in Washington, to suggest that Greece should default, suffer the short-term pain and follow Argentina’s example.
But even Yanis Varoufakis, Greece’s firebrand finance minister who advocates standing up to the European Union’s demands, said the idea that Greece could default and emulate Argentina was “profoundly wrong,” as he put it in a recent blog post — a point he reiterated when we spoke a few weeks ago.
Argentina’s economic recovery was largely driven by a fortuitously timed surge in commodity exports driven by demand from fast-growing Brazil and China. (Although the commodity boom is long over, and Argentina’s economy today is at best stagnating, those two countries still account for about 28 percent.) Soybean meal, corn and soybean oil are the country’s top three exports. Argentina had a population of over 41 million and gross domestic product of $610 billion in 2013. Although it’s a net importer of energy, it has vast shale oil and gas reserves that could make it self-sufficient.
Greece, by contrast, is heavily dependent on imports. Its top three are crude oil, refined petroleum and pharmaceuticals, all necessities. While its top export is also refined petroleum, it has to import crude oil for its refineries. Its only major homegrown exports are fresh fish and cotton. It would be hard to significantly increase sales of either product: The European Union has strict quotas to prevent overfishing, while cotton production is struggling from reduced demand for textiles and a lack of bank financing.
“Idle productive resources in Greece cannot produce much for which there is increasing demand,” Mr. Varoufakis wrote.
Mr. Gros noted, “Greece doesn’t export much.” If the country left the European Union and brought back a sharply devalued drachma, “They’d gain some from tourism,” he said. “But they’ve already cut prices and tourism has gone up. But it hasn’t really helped because total revenue hasn’t gone up.”
And compared with Argentina, Greece is tiny, with a population of just over 11 million and gross domestic product of $242 billion in 2013. “Argentina is a resource-rich country that, if forced to, can live with its own resources,” Mr. Porzecanski said. “The economic viability of Greece on its own has never been tested” since 1981, when Greece joined the European Union.
Everyone pretty much agrees that, if Greece could devalue its currency, as did Argentina, its economy would benefit. But it was also relatively easy for Argentina to devalue the peso by severing its link to the United States dollar, a tie that was self-imposed. As Mr. Varoufakis put it, Greece doesn’t have a currency that’s pegged to the euro: “It has the euro.” The practical challenge of disseminating a new currency would be enormous. Moreover, Greek savings now denominated in euros (and, in many cases, deposited in European banks outside Greece) can’t be converted to drachmas, as the Argentines converted savings into pesos.
Converting to the drachma would also be a crushing blow to the private sector, much of which finances its activities with euro-denominated loans from non-Greek banks. “They wouldn’t be able to service the debt with devalued drachmas,” Mr. Porzecanski said. Nor would Greek courts have the final say in any ensuing litigation.
In Argentina, “the government ruled that a corporation or bank that owed debts denominated in dollars were payable in pesos at a one-to-one exchange rate,” Mr. Porzecanski said. “They could do that with internal debt. But Greek companies have a lot of cross-border obligations. The European Central Bank has kept Greek banks alive. Its collateral would be worth only a small fraction if Greece leaves the euro. The Greek banks would be insolvent immediately.”
In sum, he said, “It would be a royal mess.”
But as game theorists point out, there’s no guarantee a rational outcome will prevail.
After surging early this week on optimism that Greece had come forward with a workable proposal, markets gyrated on concerns that it still didn’t go far enough to satisfy Greece’s major creditors. And Mr. Varoufakis, while conceding that leaving the euro would be a disaster, still contends a Greek default would be manageable and give Greece more leverage in longer-term negotiations to keep Greece in the European Union and eurozone.
No matter how much worse it might be for Greece than Argentina, “the outcome will ultimately be determined by politics, not economics,” Mr. Gros said. “Economists are terrible at predicting political outcomes.”
Mr. Porzecanski put it another way: “Do the Greek people know they’re playing with fire and might get burnt? It’s what they voted for, and they seem to have voted with their eyes wide open. Not everyone values prosperity the same way” as people in the United States and most of Europe do.
For others, which evidently includes many Greeks, ceding national sovereignty to foreign lenders may be worse than economic chaos. As Mr. Varoufakis wrote, “I salute the Argentinian people for having toppled a regime, and more than one government, that tried so desperately to sacrifice a proud people on the altar of I.M.F.-led austerity.”
People in countries like Venezuela and Cuba have tolerated failed economies and low standards of living for years, and the Russians seem all too willing to follow President Vladimir Putin into recession. “Populism and nationalism,” Mr. Porzecanski said, “are still potent forces.”
3. KRUGMAN CRITICIZED BY BIGGEST BANK IN BALTICS FOR ARGENTINA JIBE (Bloomberg News)
By Amanda Billner and Niklas Magnusson
June 25, 2015
The biggest bank in the Baltic region criticized Paul Krugman for comparing Latvia with Argentina at the height of the global financial crisis in 2008.
The Nobel laureate’s predictions failed to take a number of key differences between the two countries into account, including its membership in the European Union and NATO, as well as its debt laws, Swedbank AB Chief Executive Officer Michael Wolf said.
“The analysis was appallingly poor,” Wolf said in an interview in Stockholm earlier this month.
Krugman’s comments in late 2008 did a lot of damage, because they “influenced the whole sentiment,” according to Wolf. He became CEO a few months later, when the Swedish bank was struggling to stem losses brought on by a credit-fueled housing bubble in the former Soviet region.
“Perception can be created by people like Paul Krugman,” Wolf said. “That makes the less informed part of the population make the wrong decisions.”
Krugman didn’t respond to an e-mailed request sent June 24 seeking comment.
In opinion pieces published in the New York Times in December 2008, Krugman said Latvia was the new Argentina, comparing the Baltic nation’s economic crisis with the South American country, which defaulted in 2001.
“The most acute problems are on Europe’s periphery, where many smaller economies are experiencing crises strongly reminiscent of past crises in Latin America and Asia: Latvia is the new Argentina; Ukraine is the new Indonesia,” he wrote.
Latvia applied for a bailout from the International Monetary Fund and the EU in 2008 after its second-biggest bank collapsed when its housing bubble burst. The events triggered a recession that culminated in Latvian gross domestic product contracting 14 percent in 2009.
Latvia resisted calls from economists including Nouriel Roubini and Krugman to abandon its currency peg. It opted instead for austerity measures totaling more than 11 percent of GDP in 2009, an unprecedented adjustment in a single year, according to the IMF.
Latvia’s budget cuts during the darkest hours of the financial crisis “saved” its Baltic neighbors, Andrius Kubilius, who was the prime minister of neighboring Lithuania at the time, said in 2010.
Wolf said Swedbank dealt with the panic surrounding the Baltic crisis by publishing stress test results. “At least when we said something, you’d get data that was there for everyone to look at,” he said. “Step by step, we were able to change the picture.”
There’s no question Latvia was in “a very difficult situation,” Wolf said. But its determination to become an integrated member of the EU, and subsequently the euro zone, “is something that you can’t put into Paul Krugman’s models,” he said.
Latvia never defaulted, and has enjoyed seven consecutive quarters of economic growth. Its unemployment rate was 8.6 percent in May, compared with a high of more than 17 percent in March 2010.
It’s not the first time a high-ranking Swede has criticized Krugman. Riksbank Deputy Governor Per Jansson faulted the Nobel laureate for being way off in his characterization of the Swedish central bank as a “sadomonetarist” institution. Krugman has argued the Riksbank’s crisis policies were too tight given the outlook for inflation and unemployment. The Riksbank has responded that the data show a more nuanced picture, given an overheated housing market and strong economic growth.
4. EVERYONE WHO WAS HOPING THAT ARGENTINA’S BALONEY WOULD END NEXT YEAR JUST GOT HOSED (Businessinsider)
By Linette Lopez
June 25, 2015
It’s almost silly that we thought it would be so easy.
Argentina watchers hoping that the country would repay its debts and come out of default once Cristina Fernandez de Kirchner left the presidency in 2016 just had their hopes dashed.
Buenos Aires Gov. Daniel Scioli, Fernandez’s chosen successor and frontrunner in this year’s presidential election, lashed out at opposition politicians in a speech on Wednesday.
He nailed them for seeking to pay the “vulture funds,” a group of hedge funds that bought Argentine debt for cents on the dollar after it defaulted in 2001.
The lawsuit that the hedge funds brought — because Argentina’s government refused to pay them — pushed the country into default last year, but no one in the ruling party seems to mind anymore.
“Just a few hours ago, they said that we needed to run out and pay the vulture funds,” Scioli said.
He added that supporting payment would lead to more debt and destruction for the Argentine economy.
So yeah, it doesn’t sound like he wants to pay anyone.
Argentina has been refusing to pay these hedge funds, known collectively as NML, since then. Its intransigence has become an ideological issue for the government; and unfortunately it’s also one that has made Argentina a pariah of international markets and kicked it into default last summer.
Another sign? Scioli chose Fernandez’s legal secretary, Carlos Zannini, as his running mate. Zannini was the brains behind the forced privatization of YPF, an oil company that the country seized from Spanish oil company Repsol in 2012.
Zannini is the man behind Argentina’s attempt to skirt a US Supreme Court’s ruling that it could not pay other bondholders while refusing to pay the “vultures.”
So yeah, he’s not going to pay anyone either.
Last year about this time, Scioli, considered a moderate member of Fernandez’s camp by Argentine standards, was singing a different tune.
“I am confident that a solution can be found and that we can normalize our relationship with the international markets, defending our country, but defending it intelligently,” he said then.
Of course that was right before Argentina missed the payment that sent it into default again.
What it all means is what many Argentines were considering a lost year waiting for Fernandez’s exit, could turn into a lost who-knows-how-long.
Refusing to pay the “vultures” has become a part of the national project, a pillar of party ideology. There’s still a chance that Scioli could lose to an opposition candidate of course. And there’s also the hope that he’ll change course once he’s in office.
But it’s not looking good, people.
Oh, and after Scioli is done with his term, Fernandez can run again. At least that’s the talk in Argentina.
5. ARGENTINA: CURRENCY FORECAST (Economist Intelligence Unit – ViewsWire)
24 June 2015
COUNTRY BRIEFING FROM THE ECONOMIST INTELLIGENCE UNIT
These forecasts were prepared on March 5, 2015
2011 2012 2013 2014 2015
Ps:US$ (av) 4.1 4.5 5.5 8.1 9.5
Nominal appreciation of Ps (%) -5.2 -9.4 -16.9 -32.4 -15.2
Real appreciation of Ps (%) 14.9 10.8 -2.5 -9.6 5.5
Ps:US$ (end period) 4.3 4.9 6.5 8.5 10.9
2011 2012 2013 2014 2015
Ps:€ (av) 5.7 5.8 7.3 10. 7 10.2
Nominal appreciation of Ps (%) -9.6 -1.9 -19.6 -32.4 4.9
Real appreciation of Ps (%) 9.5 19.9 -4.2 -7.4 34.0
Ps:€ (end period) 5.5 6.5 9.0 10.3 10.7
2011 2012 2013 2014 2015
Ps:¥100 (av) 3.8 4.2 5.2 7.7 9.2
Nominal appreciation of Ps (%) -11.1 -10.4 -18.1 -33.0 -16.0
Real appreciation of Ps (%) 10.7 12.0 -1.8 -8.6 6.2
Ps:¥100 (end period) 3.9 4.6 6.2 8.1 10.5
2011 2012 2013 2014 2015
Real effective exchange rate (1997=100) 51.1 48.8 50.0 49.8 49.1
PREVIOUS AVAILABLE SIX MONTHS
Nov Dec Jan Feb Mar Apr
Ps:US$ (av) 8.46 8.51 8.56 8.64 8.74 8.82
Persistent pressure on the black-market exchange rate highlights the large and growing risks to our benign baseline assumption that the process of peso adjustment will be managed without provoking an abrupt, uncontrolled devaluation.
The peso remained stable in the immediate aftermath of Argentina’s default on July 30th, based partly on the assumption that Argentina would come to a relatively quick agreement with the holdouts and exit default once the Rufo clause expires at the end of 2014. However, subsequent signs that the government is in fact in no hurry to come to an agreement with holdouts (as evidenced by its decision to press forward with a swap of exchange bonds to evade its troublesome US court ruling), combined with local data showing an increased fiscal deficit and a pick-up in inflation have heightened market nervousness and produced renewed devaluation pressure.
Direct intervention in the foreign-exchange market limited the weakening of the peso in the official market to 5% between late August and late September, but the value of the black-market rate has fallen much more substantially, producing a black-market premium that is now approaching 90%. Our benign baseline forecast assumes that after depreciating by close to 35% in 2014, continued adjustment under the heavily managed float will involve a still-substantial depreciation of around 20% per year in 2015-16 and around 10% per year in 2017-19.
This would reverse the accumulated real appreciation of the peso in the past five years that has eroded export competitiveness, and bring the real trade-weighted exchange rate back to around 2008 levels. However, in light of continued uncertainty over the direction of policy in the remainder of the Fernández government’s term, we continue to believe that there are substantial risks to our forecast, and a strong chance of a steep, uncontrolled devaluation at some point in the forecast period.
GLOBAL EXCHANGE RATE ASSUMPTIONS – 16 Jun 2015
2011 2012 2013 2014 2015
¥:US$ (av) 79.7 79.8 97.6 105.9 121.7
US$:€ (av) 1.39 1.29 1.33 1.33 1.07
¥:€ (av) 110.9 102.6 129.6 140.7 130.7
ARGENTINA NEEDS MORE FOREIGN CAPITAL FOR VACA MUERTA: SAGGESE (Platts Commodity News)
By Charles Newbery
24 June 2015
Neuquen, Argentina (Platts)–24Jun2015/820 pm EDT/020 GMT
* Drilling costs must come down to attract capital
* Limited acreage still available, so partnerships good for new entrants
* But license law change means no rush to bring partners on board
The dozen or so companies with acreage in Vaca Muerta, the biggest shale play in Argentina, will need more foreign capital to shift into development after pilot testing, an industry leader said Wednesday.
“We need more companies and more investment,” said Alberto Saggese, president of Gas y Petroleo del Neuquen (GyP), the state oil company of the southwestern province of Neuquen, home to most of Vaca Muerta.
State-run YPF was the first to put the play into mass production in a partnership with Chevron. They are producing 43,000 b/d of oil equivalent, mostly of light crude.
Of the other players with acreage in the play, four have recently entered pilot production, led separately by ExxonMobil, Shell, Total and Wintershall.
“If the pilots work and they have to do mass development, they are going to have to find partners,” Saggese said on the sidelines of the World Shale Oil & Gas Latin America Summit in Neuquen City. “It is too much money for any of them to go it alone.”
Most estimates suggest that between $5 billion and $12 billion a year must be invested to put Vaca Muerta into mass production, helping to turn around a 20% decline in national oil and gas production over the past decade that has led to shortages and a rise in imports.
However, Saggese said that for foreign companies to bet on Vaca Muerta, drilling costs must come down to attract capital at a time when low global oil prices are shrinking investment budgets.
The goal is to reach the cost levels of $4 million-$5 million/well seen in shale plays in the US, Saggese said.
YPF is drilling vertical wells at $7 million/well, down from $11 million in 2013.
To continue cutting costs, what is needed most is foreign capital to ramp up drilling and improve operational efficiency with new technology and techniques like slim-hole drilling, Saggese said.
YPF has gone out to look for partners, entering joint ventures with Chevron and Malaysia’s state-owned Petronas for Vaca Muerta, and Dow Chemical for a tight-gas development in another play. Gazprom has expressed interest in partnering with YPF, while Canada’s Madalena Energy, Shell and others have announced plans to look for partners in Vaca Muerta.
Saggese said such partnerships are one of the few remaining entry points for new players in Vaca Muerta.
“There is little acreage still available, and it is marginal,” he said. “The acreage still available is in the foothills [of the Andes mountains] and the dry gas window.”
Of Vaca Muerta’s total acreage, YPF has a 36% share, followed by GyP with 11%, Wintershall and Total each with 6%, YPF’s Y-SUR unit with 5% and Petrobras. Andes Energia, ExxonMobil, Pluspetrol and a few other companies hold smaller percentages.
Saggese said he doesn’t expect companies to rush out in search of partners.
This is because a reform of the national hydrocarbon law last year means that the companies have 35-year concessions for their acreage. So whereas before the reform, companies would have to demonstrate their exploration and production advances on the blocks as a requirement of their licenses, now the threat of invest or lose the license is no longer there, he added.
Bonafini: ‘Scioli will be surrounded by VP, Congress’
- 6 min read
Bedrock Arguments on Why Diplomacy Matters!
3. HEAD OF ARGENTINA’S ARMY, CESAR MILANI, STEPS DOWN; LONG ACCUSED OF HUMAN RIGHTS VIOLATIONS (Fox News)5. BUENOS AIRES MOTOR SHOW 2015: MERCEDES ADDS VITO, CHERY INTRODUCES NEW MODELS (IHS Global Insight Daily Analysis)By Benedict Mander in Buenos AiresJune 23, 2015While Buenos Aires sleeps, La Salada roars to life. By 3am, shoppers are chaotically barging their way through the narrow passageways of Latin America’s largest informal market, hauling sacks bulging with anything from fake branded clothing to pirate DVDs.“Look at this, just 135 pesos!” exclaims a satisfied Rodrigo Vega as he brandishes a pair of jeans, explaining that the price, about $15 at the overvalued official exchange rate, is at least a fifth of what they might cost in a more upmarket Argentine shopping centre.For Mr Vega, like many other Argentines struggling to get by on wages sapped by double-digit inflation and a flatlining economy, it was worth the seven-hour bus ride from the interior to get to La Salada, which has annual revenues of at least $3bn, according to organisers. Others come from as far afield as Paraguay and Brazil to join the hundreds of thousands that on market days scour as many as 40,000 wire-mesh stalls jammed into warehouses on the banks of a putrid river in the rundown outskirts of Buenos Aires.Its popularity first exploded during the country’s economic collapse at the start of this century as bargain-hunting Argentines were drawn in by rock-bottom prices of textiles made in local sweatshops. But La Salada is booming once again, its popularity an ironic bookmark to nearly 13 years of presidential rule by Cristina Fernández and her deceased husband, Néstor Kirchner, who came to power in 2003 after Argentina’s 2001 default and subsequent devaluation.“During the bad times, La Salada took off, but when things got better [during the commodity boom] people had got used to coming here so it kept growing,” said Jorge Castillo, the public face of La Salada and the administrator of its biggest warehouse. He says the market sells at least $20m of merchandise on open days, with annual sales rivalling those of all of Argentine e-commerce of about $4.4bn.“Now things are bad again, people keep on buying more and more here. Many can’t make it to the end of the month,” added Mr Castillo, complaining of Argentina’s stagnating economy.Now things are bad again, people keep on buying more and more here. Many can’t make it to the end of the month– Jorge Castillo, administrator of La Salada’s biggest warehouseTweet this quoteAlthough Ms Fernández claimed during a trip last week to Europe that less than 5 per cent of Argentines live in poverty — after the government stopped publishing its much-questioned poverty statistics in 2013 — independent groups estimate that more than 25 per cent of the population had been pushed under the poverty line by last year when prices rose as much as 40 per cent.As Ms Fernández reaches the end of her presidency, with elections due in October that are expected to produce a more market-friendly administration, she is fiercely defending her political record. It is part of an effort to shore up support among her largely poor power base in order to maintain some influence once she leaves office.Although La Salada has been blacklisted by the Office of the US Trade Representative because of its counterfeit produce — the logos of brands like Adidas, Nike or Lacoste catch the eye at every turn — its popularity has protected it from the kind of heavy-handed government intervention that is normal elsewhere in the country.In fact, the government has even invited representatives of La Salada on trade missions to countries like Angola and Vietnam in an effort to export its business model, which reduces costs by cutting out the middle man.“Now it is a place of progress, not just of survival,” says Sebastián Hacher, the author of a book on La Salada who highlights its “brutal contradictions”, at once epitomising Argentina’s darker side and its flair for creativity in the face of adversity.It all started in 1991 when a group of Bolivian immigrants first set up stalls at La Salada to sell their manufactured wares directly to consumers. Local merchants were struggling to compete with cheap imports in the early years of the presidency of free marketeer Carlos Menem, who had just slashed trade barriers and pegged the peso to the dollar.Shortly afterwards, Mr Castillo bought up land at La Salada, so called because it was formerly a saltwater spa that had been spoiled by industrial pollution. It was a canny investment that allowed him to transform from a small-time shoemaker into a powerful business magnate and local political boss.Mr Castillo dismisses accusations of tax evasion as bad-mouthing by Argentina’s “bloodthirsty” traditional business elites who are simply afraid of losing out on juicy profits. “Argentine businessmen don’t know how to compete. They don’t want to pay taxes, they want easy credit, they want cheap dollars. They want paradise, to live like kings,” he says.Now, Mr Castillo is hoping to give US businesses a run for their money too, with plans to open a version of the fair in Miami.By Camila RussoJune 23, 2015Argentina’s peso fell to a four-month low in the illegal street market on speculation the successor to President Cristina Fernandez de Kirchner will retain currency controls.After about three months of the black-market peso hovering around 12.6 per dollar, it climbed almost 3 percent in the past week as Daniel Scioli, the Buenos Aires provincial governor who is running for president with the ruling party, gained in polls and appointed a running mate loyal to Fernandez. Illegal exchange houses face increased police raids, drying up liquidity and contributing to the plunge, according to Gustavo Quintana, a trader at Rabello & Cia. in Buenos Aires.“The political climate is making people nervous and driving them to the dollar,” Quintana said by phone from Buenos Aires. “The controls make it worse. They exacerbate the move.”The black-market peso, known as the blue, plunged 1.5 percent to 13.24 per dollar Tuesday as of 2:22 p.m. New York, the weakest level since Feb. 5. The official peso, subject to daily intervention by the central bank, was little changed at 9.06.Fernandez has banned most foreign-exchange transactions since her 2011 re-election to curb capital outflows, causing the illegal currency market to flourish.The gap between the official and black-market rate narrowed since the illegal currency touched a record 15.95 per dollar in September on speculation whoever is elected in October will dismantle currency controls.Midyear bonuses increased pesos circulating in the market, adding to dollar demand, Quintana said.3. HEAD OF ARGENTINA’S ARMY, CESAR MILANI, STEPS DOWN; LONG ACCUSED OF HUMAN RIGHTS VIOLATIONS (Fox News)June 23, 2015BUENOS AIRES, Argentina – The head of Argentina’s army, long accused of human rights violations, has resigned.A brief army statement issued Tuesday says Maj. Gen. Cesar Milani submitted his resignation for personal reasons.The 60-year-old Milani has been charged in the disappearance of soldier Alberto Ledo in 1976 in the northern province of Tucuman and with torturing two members of the same family in the northeastern province of La Rioja. The cases have yet to be tried in court. Milani denies the allegations.President Cristina Fernandez’s decision in 2013 to name him head of the army was sharply criticized by human rights groups.Thousands of people were killed or disappeared during the South American nation’s military dictatorship between 1976 and 1983. In the late 1970s, Milani was a lieutenant and intelligence expert.By Fabiana Frayssinet23 June 2015BUENOS AIRES, Jun. 23, 2015 (IPS/GIN) – Until not too long ago, young people in Argentina faced a choice: whether to study or drop out and go to work. But now most adolescents in Argentina who work also continue to study – a change that poses new challenges for combating school dropout, repetition and truancy, as well as the circle of poverty.The change is revealing, according to Néstor López at the United Nations Educational, Scientific and Cultural Organisation’s International Institute for Education Planning (IIEP UNESCO), which together with the International Labour Organisation (ILO) produced the report “Trabajo infantil y trayectorias escolares protegidas en Argentina” on child labour and education, launched this month, which discusses the new situation.“When you analysed what was happening with teenagers 20 years ago, you saw two different situations,” López said in an interview with IPS. “There were adolescents in school and adolescents who worked.”“But what you see now is that school enrollment rates have gone up significantly, which has meant to some extent a reduction in their rates of participation in the labour market, but has also meant an increase in the proportion of adolescents who both study and work,” he said.In 2013, practically all children in Argentina between the ages of five and 14 and 84 percent of adolescents between 15 and 17 were in school, the study says.Gustavo Ponce, an ILO expert in prevention and eradication of child labour, said measures like the 2006 National Education Law, which made education obligatory until the last year of secondary school (17 or 18 years of age), contributed to the new trend of adolescents working and studying at the same time.“Progress has also been made in terms of legislation and regulations, with a law that raised the minimum working age to 16, which included the question of protection of adolescent workers aged 16 and 17,” Ponce told IPS.He was referring to a law that protects young people from heavy or dangerous work, or work that makes it impossible for them to attend school or endangers their health.He was also referring to the 2013 reform of the penal code, which made child labour a crime.In their report, the ILO and UNESCO mentioned these measures as well as others, such as the Universal Child Allowance cash transfer programme, which have helped discourage child labour by boosting the incomes of poor families.“Yes, you could say there has been a policy to eradicate child labour,” said Ponce.López said that what is needed now is to continue improving school enrollment and attendance among adolescents. According to the new study, of the children between the ages of five and 13 who both work and attend school, approximately one-third repeat the year, compared to 13 percent of children who do not work.With regard to truancy, the report cites statistics from a Labour Ministry survey of activities among children and adolescents, pointing out that 20 percent of those who both work and study frequently miss school, compared to 10 percent of those who only attend school.And in the case of adolescents who work, 26 percent do not go to school, and 43 percent of those who do attend school are held back. Among those who only study, 27 percent repeat the year.“It’s better than if they were just working,” said López. “It’s good for kids who are working to also be studying, preparing for their future. You could say it’s a positive thing if the kids who have to work can also go to school.”Overall, though, “it’s negative because what the statistics, studies and common sense show is that these kids have a lower quality educational experience, because they don’t have time to do their homework, they don’t have time to study, they go to school tired, they miss school more, and they get less out of the educational experience for different reasons,” he added.According to the Labour Ministry, child labour was reduced 66 percent from 2004 to 2012 – from 450,000 children working in 2004 to 180,000 in 2012.But another concern are less visible forms of child labour, such as unpaid housework and caregiving, which especially affect girls and young women, including caring for younger siblings, cleaning the house, fixing meals, and taking care of small barnyard animals.“Educational level is one of the main mechanisms used by the labour market to select workers. Access or lack of access to formal education is one of the aspects most heavily associated with the process of intergenerational accumulation of social disadvantage,” says the report.Among the measures to encourage school attendance, the ILO proposes improving the network of free public services that support caregivers, including childcare centres, preschools, and double shifts in schools. In Argentina, schoolchildren attend either the morning or the afternoon shift. But full-day schools are becoming more common in low-income areas, enabling mothers to work.The ILO also proposes campaigns to combat certain beliefs or customs, especially in rural areas.“When we interview parents, for example, it’s clear that they think it’s normal to feed and milk the livestock before going to school, as if it were a way to help out at home and a positive learning experience rather than work that children do at home,” the report says.The trade unions, meanwhile, say the concept of eradicating child labour should also be included in the educational curriculum.Hernán Rugirello, with the Confederación General del Trabajo central trade union’s social research centre, told IPS about an initiative carried out by the union in Mar del Plata, a city 400 km south of Buenos Aires. With the help of the teachers’ union, the issues surrounding child labour have begun to be taught in schools there.“It’s important to put this problem on the agenda, so that young people will also start understanding it and will become agents of transmission of knowledge, bringing the issues home with them,” he said.5. BUENOS AIRES MOTOR SHOW 2015: MERCEDES ADDS VITO, CHERY INTRODUCES NEW MODELS (IHS Global Insight Daily Analysis)By Stephanie Brinley23 June 2015The seventh annual Buenos Aires International Motor show happens this week. Mercedes-Benz will announce sales and production of the mid-size commercial van, Vito, for Argentina. The Vito will be produced in Argentina beginning in June 2015, and will be exported to other countries in the region. The rollout of the Vito is part of a larger “Mercedes-Benz Vans goes global” push, and follows introduction of the Vito in the US market (badged as the Metris). Chery displayed the T21 and M16, which are due to be launched in Argentina in 2016. In a statement, the company called them its “major strategic models.” Chery already offers the QQ, Fulwin and Tiggo in the market. Renault also made news at the show with the Duster Oroch pick-up and Sandero RS (see Argentina: 9 June 2015: ).Significance: Argentina’s automotive market is currently under a tremendous amount of stress (see Argentina: 9 June 2015: ), with sales having fallen nearly 28% in 2014 and down 21.9% through May 2015. IHS forecasts sales will slip another 27% in 2015, not returning to growth until 2017. There is expectation for growth, however. Chery’s presence in the Argentine market is still a young one, although we forecast sales of 3,000 units for the company in 2015. We forecast that sales of the Vito will reach 2,800 units in 2017 and exceed 3,200 units in 2019 – about 28% of the brand’s sales in the country. Renault has also been hit notably hard by the downturn, with sales down 32.6% year on year through May 2015. Delivering positive product activity in an overall negative market, for all of these companies, can be a show of strength and commitment to the market, which could pay off as recovery begins.THURSDAY, June 25th
Bedrock Arguments on Why Diplomacy Matters!
2. OUTLOOK FOR ARGENTINA’S OCTOBER ELECTION BECOMING CLEARER, WITH KIRCHNERISTS LIKELY TO REMAIN INFLUENTIAL IN NEXT GOVERNMENT (IHS Global Insight Daily Analysis)1. SCIOLI SCOLDS ARGENTINE OPPONENTS FOR SEEKING TO PAY ‘VULTURES’ (Bloomberg News)By Charlie DevereuxJune 24, 2015Argentine presidential candidate Daniel Scioli criticized rivals seeking to succeed President Cristina Fernandez de Kirchner in October’s election, saying they want to pay “vulture funds” that sued the government for full payment from the 2001 default.In a speech to open a bank workers conference Wednesday, the current governor of Buenos Aires province also said his opponents would mete out neo-liberal “adjustment” measures that would hurt the poor and revive policies that had only racked up debt and led to the financial crisis of 2001-2002.“Just a few hours ago, they said that we needed to run out and pay the vulture funds,” Scioli, the front-runner in presidential polls, said. The opposition is a “new version of an alliance of adjustment and indebtedness that damaged the policies of the workers and society.”Scioli roiled markets last week by naming Legal Secretary Carlos Zannini, one of Fernandez’s closest confidantes, as his running mate. Zannini has been instrumental in crafting up some of Fernandez’s most controversial policies, such as the nationalization of the country’s pension funds and oil company YPF SA. He was also behind legislation that aimed to bypass a New York court ruling ordering the government to pay holdouts from Argentina’s 2001 default when making payments to holders of restructured bonds.Gabriela Michetti, opposition presidential candidate Mauricio Macri’s running mate, said this week that while Argentina should put up a fight against the litigants led by Paul Singer’s Elliott Management, it should ultimately abide by the law and obey the ruling.Fernandez’s refusal to observe the court order resulted in a second default in 13 years in 2014 for Argentina after a New York judge blocked payments on restructured bonds.“Our project is about productivity, social inclusion, of policies of integration,” Scioli said Wednesday. “ I believe in that. There are strategic areas where the state can’t delegate to the market.”2. OUTLOOK FOR ARGENTINA’S OCTOBER ELECTION BECOMING CLEARER, WITH KIRCHNERISTS LIKELY TO REMAIN INFLUENTIAL IN NEXT GOVERNMENT (IHS Global Insight Daily Analysis)By Carlos Caicedo24 June 2015Pro-government candidate Daniel Scioli continues to lead in opinion polls and an endorsement by President Cristina Fernández de Kirchner has boosted his presidential chances.IHS perspectiveSignificanceThe official register of presidential candidates, declared on 22 June, clarifies Argentina’s presidential race in October.ImplicationsPro-government candidate Daniel Scioli and opposition contender Mauricio Macri have emerged as the two frontrunners, with Scioli having the edge thanks to the support of incumbent president Cristina Fernández de Kirchner.OutlookScioli is best placed to succeed Fernández, but his ability to implement pro-business policies would require him to confront Kirchnerists – including his running mate – who will remain influential in Congress and the cabinet.Buenos Aires governor Daniel Scioli greets Argentina’s President Cristina Fernández de Kirchner, as Minister of Economy Axel Kicillof watches, during a signing ceremony in Buenos Aires, on 30 January 2015.PA.22096744Argentina’s political parties registered their presidential candidates with the president and parliament on 22 June. Candidates will compete in primaries on 9 August, the winners of which will compete in the general election on 25 October. The roster of presidential candidates, their running mates, and political alliances is now clear. The field is centred around two frontrunners: Governor of Buenos Aires Daniel Scioli for the ruling party Victory Front (Frente para la Victoria: FpV) and Mauricio Macri, the current mayor of the city of Buenos Aires, from a coalition of three parties – his own Republican Proposal (Propuesta Republicana: PRO), the Radical Civic Union (Unión Cívica Radical: UCR), and the Civic Coalition (Coalición Cívica: CC).Scioli’s chances have been strengthened by the endorsement of President Cristina Fernández de Kirchner. However, to secure the endorsement he has been forced to choose Carlos Zannini, a staunch Kirchnerist, as his running mate. Zannini was a close confidant of late president Néstor Kirchner and currently serves as Fernández’s legal adviser and key strategist. Zannini’s inclusion on Scioli’s ticket will guarantee the support of the influential Kirchnerist faction La Cámpora, the political vehicle led by Fernández’s son Máximo Kirchner, labour unions, and other militant movements. In addition, Fernández ordered Florencio Randazzo, Minister of the Interior and Transport, to step down as a challenger to Scioli in the August primaries.Macri, meanwhile, has selected Senator Gabriela Michetti of the PRO as his vice-presidential nominee. By choosing a running mate from his own party, Macri has risked limiting alliances with other parties. However, he has concluded that the country wants change – opinion polls show 60% of Argentines are against the re-election of a government led by the FpV. Based on this, Macri has decided to polarise the election, instead of forging an alliance with dissident Peronists who are former government allies, such as Sergio Massa of the Renewal Front (Frente Renovador: FR) alliance.Massa, the third contender, is the mayor of Tigre municipality in Buenos Aires province and came to national attention in 2013 when he unexpectedly became the main winner of the mid-term elections. Since then he has been campaigning nationally and building an electoral base. Massa offered Macri an electoral alliance, which would have required the two to face each other in the primaries, but Macri rejected the offer. Support for Massa has been dwindling rapidly since early 2015 as the electorate and mid-ranking party leaders focus on Scioli and Macri.Outlook and implicationsThe political rearrangements post-22 June have put the FpV’s Scioli as the best-placed candidate for the October presidential election. He has long been a strong candidate with a good track record as governor of Buenos Aires province. His main weakness until last week was uncertainty over whether President Fernández would support him. Both Scioli and Fernández come from the Peronist party, but have significant differences over policy-making. Scioli has a good rapport with the private sector and has long acknowledged that Argentina needs a major shift in economic policy in order to restore credibility and normalise relations with international creditors. However, he is aware that without Fernández’s support his chances of winning office would diminish significantly. This strategy, however, entails the danger of Fernández’s clout in Congress tying his hands and preventing him from delivering any meaningful change, resulting in a status quo with only superficial changes.A victory by Macri currently appears unlikely, given his strategy of shunning an agreement with Massa, which would have widened his appeal and national reach. He hopes that Scioli’s close association with the Fernández government would cost him the support of independent voters. Macri is market friendly and has promised to restore investors’ confidence quickly if he is elected. He has said he will immediately lift currency controls and is widely perceived to be best placed to negotiate an agreement with the “hold-outs”, the minority bondholders who rejected the debt restructuring that followed Argentina’s debt default in 2002 (see Argentina: 5 January 2015: Argentine government unlikely to make improved offer to hold-out creditors as RUFO clause expires).Scioli is expected to reach out to the hold-outs too, but this is likely to be hampered by strong objections from Fernández and her followers. The Kirchnerists have control of key government agencies, and are likely to retain a strong presence in the cabinet and Congress, from which they can exert significant influence. This means negotiations with the hold-outs under Scioli, although feasible, would be protracted due to his need to accommodate Kirchnerist support. However, the presidential office is exceptionally powerful in Argentina and Scioli is expected to make use of the special powers it would provide him. He is likely to distance himself gradually from Fernández’s hostile policies towards foreign investors, but this would be a very slow process and is only likely to bear fruit by 2017. Scioli is also expected to engage the agribusiness sector, leading to a reduction in export taxes and export controls, as well as prioritise foreign investment in the energy sector by supporting joint ventures undertaken by state-run oil company YPF.3. ARGENTINA RESID IMPORTS VANISH AS POWER SECTOR TURNS TO OTHER SOURCES (Platts Commodity News)By Josh Pherigo24 June 2015Houston (Platts)–24Jun2015/1151 am EDT/1551 GMT Fuel oil imports to Argentina, which typically buys millions of barrels of foreign residual fuel for winter power generation, have all but dried up this year as import flows have switched to high sulfur diesel.One month into winter, Argentina’s state-run electricity producer Cammesa has yet to import a single cargo of fuel oil and has instead turned to cargoes of high sulfur diesel and locally produced fuel oil, market sources said.By this time last year, YPF, the government-owned oil company, had purchased 11 fuel oil cargoes totaling 550,000 mt, equivalent to about 3.5 million barrels, according to tender reports. Since January, no Argentina-bound residual fuel fixtures have been seen, according to market sources.Argentina imported more than 12 fuel oil cargoes last year, including a few from the US and at least three others from the Caribbean, where the fuel oil is made by blending Colombian fuel with US Gulf Coast materials, a source said. Brazil is also a large exporter to Argentina due to their proximity, and a source said they exported at least five cargoes to Argentina last year.Petrobras, Vitol and Glencore are among the companies that typically supply residual fuel cargoes to YPF. Between January and July last year, Vitol exported 2.5 million barrels of 1%S max fuel oil to Argentina, according to tender reports.Vitol does not expect to fix any fuel oil cargoes in Argentina this season, a source familiar with the company’s operations said.“Fuel oil intake has been very low, and industry consumption has been very low. There has been more self-generation for electricity,” the source said.HSD IMPORTS, DOMESTIC FUEL OIL PRODUCTION RISESCammesa, which operates the country’s power plants and electricity grid, has replaced imports of fuel oil with a combination of domestically produced residual fuel barrels and imported distillates, which have increased over their year-ago levels, sources said.Fuel oil production was up 1.4% in the first quarter of the year, rising to 1.184 million barrels, according to government data.“There have been no fuel imports because the fuel is being produced locally,” a source said.Cammesa has also drawn fuel oil away from the marine fuel market, one Argentina bunker trader said.RMG 380 bunker prices in Buenos Aires have shot up in recent weeks, with HS bunkers hovering around $80/b in June, while Brent crude has averaged about $64/b, putting the marine fuel at a $16/b premium to the global crude benchmark. A year ago, the positions were reversed with bunker fuel in Buenos Aires at a $16/b discount to crude.“Cammesa is paying higher prices for the fuel oil, which is squeezing bunker supplies,” the trader said.Additionally, YPF has been importing about one cargo per week of 0.15%S high sulfur diesel, which one trade source said “is too much” and has replaced fuel oil consumption in Argentina.“Apparently they are using HSD instead of fuel oil,” one Latin America source said.So far this year YPF has imported 1.45 million cu m of high sulfur diesel, or about 9.12 million barrels. Cammesa last week issued a tender for an additional six cargoes of high sulfur diesel fuel totaling 500,000 mt, equivalent to 1.9 million barrels.Last year YPF had imported 1.25 million cu m, or 7.86 million barrels, of HSD for delivery between April and July, and no tenders of HSD were heard to be awarded after May 30, 2014.Tender data shows that YPF imported 32 cargoes of HSD in 2014 and have already imported 26 so far this year, not including the six cargoes that have not been awarded yet.Noble, Trafigura, Lukoil and Glencore have been awarded most of the HSD tenders to Argentina so far this year, while Cargill, Shell and Gunvor have each won one.High sulfur heating oil in the Gulf Coast is typically 0.2%S, and Latin sources said Argentina typically imports HSD from Europe.“I know diesel is more expensive than fuel oil, so it should not make sense, but it looks like they are replacing fuel oil by HSD,” a source said.WARMER WEATHERTraders have pointed to a number of factors, including warmer weather, as likely causes for the fuel oil import slowdown.Temperatures in Argentina were unseasonably warm through the fall and have persisted through the first month of winter — the season when utility-grade fuel oil is typically in its greatest demand. Average temperatures from March through May throughout the country were 1-3 degrees C higher than normal, equivalent to about 2-5 degrees F higher, according to the Servicio Meteorologico Nacional, Argentina’s federal weather tracking agency. Forecasters are predicting the warm weather to continue through winter, which runs June-September in the southern hemisphere.One source based in Latin America said the milder temperatures may be contributing to the decline in fuel oil imports.Residual fuel is a sought-after fuel source for power generation during winter, when electricity producers require a cheap alternative fuel for times of peak demand.4. ARGENTINA PAYS TRIBUTE TO CARLOS GARDEL ON 80TH ANNIVERSARY OF HIS DEATH (Fox News)June 24, 2015The grave of Carlos Gardel in this capital on Wednesday was the scene of a gathering by tango lovers to honor him on the 80th anniversary of his death in a plane crash in the Colombian city of Medellin.Starting early in the morning, people began showing up at the Chacarita cemetery in Buenos Aires, which on Wednesday was the site of numerous events to remember the world’s best-known tango performer.The tributes took many different forms, from photographic exhibits and informative talks to the release of an album with versions of Gardel’s classic songs.One of the main commemorative events was scheduled for Wednesday afternoon at the gravesite of the singer and composer, organized by the Gardeliano Studies Center.Later, the Carlos Gardel Home and Museum, which is supported by the Buenos Aires Culture Ministry, will present the album “Morocho,” a tribute to the tango great on which local musicians perform his classic numbers.In addition, Buenos Aires is offering talks, film screenings and expositions reviewing Gardel’s life.Since June 17, a special Gardel exhibit has been open in the capital, featuring gigantic murals, never-before-released material produced by the singer and photographs from the National Archives.In addition, more photos, shoes, letters, hats and even one of Gardel’s suits are on display at the National Historical Museum.Gardel died on June 24, 1935, in Medellin, Colombia, when the aircraft he was traveling on collided with another plane while taking off.
Too Quick on the Draw: Militarism and the Malpractice of Diplomacy in America —
Bedrock Arguments on Why Diplomacy Matters!
By Debora Rey and Peter PrengamanJune 23, 2015BUENOS AIRES, Argentina — Pope Francis’ homeland of Argentina is not on the itinerary for his South American tour in July.The pontiff hasn’t been back since he became pope more than two years ago, and the Vatican says he doesn’t want to influence October’s presidential election by visiting now. Francis has complained in recent months that he has felt “used” by Argentine politicians who take their picture with him in Rome.Instead, the pontiff will tour Ecuador and two countries that border Argentina: Bolivia and Paraguay.Although he will stay away, Francis nevertheless intensely follows what happens where he was born and spent most of his life before becoming world leader of the Roman Catholic Church, according to local journalists who have covered him for years, friends in the country and Vatican officials.“This is a pope who is very interested in politics and has considerable political sensibility,” said Mariano De Vedia, political editor for the Argentine newspaper La Nacion and author of “In the Name of the Father,” a book that examines Francis’ rocky relationship with President Cristina Fernandez and her predecessor and late husband, Nestor Kirchner.Much of what Francis says and does has an impact in Argentina, a majority Catholic nation of 41 million people where the church wields great influence.He has promised to open church files from Argentina’s 1976-1983 military dictatorship — a potential Pandora’s box that could spark more lawsuits and arrests related to the estimated 30,000 people killed or disappeared during the “dirty war.”Francis made headlines early this year by lamenting that a growing drug trade in Argentina could lead to a “Mexicanization” of the country. Many interpreted those comments as a scathing critique of Fernandez and her party, which has held power since 2003.Earlier this month, he received Fernandez at the Vatican for the fourth time, drawing the ire of some opposition leaders.“Don’t disappointment me, Francisco!” Elisa Carrio, an opposition congresswoman and aspiring presidential contender, posted to her Facebook page during his last meeting with Fernandez. “Make good on your promise not to get involved in politics.”The Vatican defended the meeting by saying that Fernandez, constitutionally barred from running for a third term, was not a candidate. Guillermo Karcher, the Vatican’s protocol chief and a fellow Argentine, told local media that the nearly two-hour meeting focused on Argentina but did not touch on the August primaries leading up to the October general vote.“The pope follows very closely and with much affection” what happens in his homeland, Karcher told Argentine radio station MDZ, adding that he and Fernandez “would certainly have talked about Argentina.”While many of Fernandez’s social welfare policies no doubt resonate with Francis, he had a frosty relationship with her when he was archbishop of Buenos Aires. The biggest fights were over social issues, such as a 2010 law that recognized civil unions of gay couples, and moves to expand sex education in schools. As a result, many interpret the pope’s meetings with Fernandez as attempts to influence her policies.Many Argentines are disappointed that he won’t be visiting.“He’s abandoned Argentina” since becoming pope, Norma Roch, 66, said after praying at Santa Catalina de Siena, a downtown Buenos Aires church where Francis would sometimes celebrate Mass when he was still Archbishop Jorge Mario Bergoglio. “He needs to come home and spend some time with us.”But others say they understand.“He is making the right decision,” said Jorge Corna, 82, cutting Roch off. “The pope isn’t stupid. Politicians here would try to use him.”Francis clearly embraces his Argentine identity. He’s a self-proclaimed fan of the country’s San Lorenzo soccer team as well as its traditional tango dancing and milonga music. After being elected pope, one of the first things he asked to be sent from the Buenos Aires rectory was his agenda with cellphone numbers of bishops and priests in the diocese, said De Vedia. He remains in frequent communication with Argentines from all walks of life.Gustavo Vera, a Buenos Aires community organizer, periodically hears from the pope, and received a letter expressing his condolences when a sweatshop fire killed two boys in April.“What occurred caused me much pain,” wrote Francis. “I’m with you all and I ask for the Lord’s help so that these kinds of things don’t keep happening.”Massimo Faggioli, a Rome-based church historian, said Francis’ relationship with his homeland differs from those the previous two popes had with theirs. John Paul II often talked about his native Poland, but unlike Francis visited his homeland soon after becoming pope. Benedict XVI rarely mentioned his native Germany, where he hadn’t lived for nearly three decades.“Not being European gives Francis more freedom” to decide how to relate to home, said Faggioli. “In not visiting now, he sends a message that he is pope for everybody and that Argentines should not feel any special rights.”By Benedict Mander in Buenos AiresJune 22, 2015Investors have long awaited the moment when Cristina Fernández will vacate Argentina’s presidential palace in December. After eight years in power, and unable to run for a third term, many assumed her departure would inevitably herald a rosy new era for the country, free of anti-imperialist rhetoric and populist economic policies.Now they are no longer so sure. Argentine assets, after a year-long rally, tumbled last week when Daniel Scioli, the leading candidate ahead of October’s presidential election, announced that one of Ms Fernández’s closest advisers would run as his vice-president.The appointment of Carlos Zannini, Ms Fernández’s legal adviser, is widely seen as an attempt by the president to exercise power after she leaves office in return for her political support. She confirmed on Saturday that she will not run for another elected office as a legislator in the upcoming elections.The move has also left many wondering whether the election will represent another retreat of the “pink tide” of leftwing governments which rose across Latin America and are now struggling in countries like Brazil and Venezuela.The two strongest candidates to be Argentina’s next president are Mr Scioli, the 58-year old governor of Buenos Aires province, who preaches continuity with Ms Fernández’s party, and Mauricio Macri, the 56-year old centre-right mayor of Buenos Aires, who has pitched himself as a turnround candidate, representing change.“It is a completely open race, which has polarised strongly around these two candidates. Both have solid chances,” said Carlos Germano, a political analyst. Polls show them running nearly neck-and-neck with about 30 per cent each, although Mr Scioli has a slight edge.On the face of it, the two men represent diametrically opposed visions of where Argentina should go.Mr Scioli, who lost his right arm in a speedboat accident in 1989, has admitted the need to reactivate Argentina’s flatlining economy. His economic advisers also accept the need to fix its tangle of currency and trade controls, and to cut double-digit inflation by restraining fiscal spending — although any changes will probably be gradual.But the appointment of Mr Zannini now “bodes poorly for the post-election policy outlook as it will limit Scioli’s ability to make serious changes,” commented Eurasia Group, the risk consultancy.In a further downbeat development for investors hoping that the election would bring an end to Argentina’s long-running dispute with hedge fund holdout creditors, led by billionaire Paul Singer, Mr Scioli has even “been hinting that he would keep [current] Economy Minister Axel Kicillof in his post,” Eurasia added.In contrast Mr Macri, the former president of top Argentine football club Boca Juniors, aims for what economic adviser Federico Sturzenegger describes as a “credibility shock”. This would open the floodgates to much-needed foreign investment and would involve sending “a strong signal” that the judiciary is independent and “stopping lying about everything” such as statistics, he said.The question playing on investors’ minds now is just how much change could come in a government led by Mr Scioli even if he wanted to introduce reforms, given Mr Zannini’s appointment.One influential figure close to him recommended “not paying too much attention to what we say in public” because of Mr Scioli’s need to keep onside Ms Fernández, and also the votes she can deliver from the electorate and in Congress. She enjoys high approval ratings of around 50 per cent, despite a mixed record in power.Another argued that the differences between the economic policy proposals of the two main candidates are “not that striking”, and are mostly to do with the speed of implementation. Furthermore, as the vice presidency is largely a ceremonial role, Mr Zannini would have little real power.“There is no time bomb waiting to explode like some in the opposition say. There are macroeconomic imbalances, yes, but it’s all manageable,” said the source. “You will not gain credibility if you promise things immediately that you won’t be able to do,” he added, arguing that whoever wins the presidency will start off weak and need to build up support over time.One factor affecting the eventual outcome is the third trailing candidate in the polls, Sergio Massa, a 43-year old former cabinet chief in Ms Fernández’s government who turned against her; he could lend his support to either of the two leading candidates.In the meantime, investors are watching closely. Daniel Freifeld, principal of Callaway Capital Management, an investment firm, says that Argentina’s next president would be “foolish” not to take the economic measures needed to boost investor confidence and entice much-needed foreign investment. “There are massive amounts of money waiting on the side lines,” he said.By Katia PorzecanskiJune 22, 2015Argentine bonds rallied after President Cristina Fernandez de Kirchner’s ruling alliance lost in Mendoza province, handing the opposition its first victory in regional elections this year.Dollar-denominated securities due 2024 gained 1.1 cents on the dollar to 95.57 cents. The rally helped pare last week’s losses of 4 cents, which were triggered after Daniel Scioli, the frontrunner for October’s presidential elections, named one of Fernandez’s closest aides as his candidate for vice president.Opposition candidate Alfredo Cornejo ended eight years of Peronist rule in Mendoza, Argentina’s fifth-largest constituency by population best known for its Malbec wine, in elections on Sunday. The victory shows that a change in Argentine leadership may still be possible, said Hernan Yellati, head of research at brokerage BancTrust & Co. Cornejo, who won 46 percent of votes, was backed by both main opposition candidates for presidency, Mauricio Macri and Sergio Massa.“The opposition is still alive,” Yellati said by phone.Additionally, elections in Tierra del Fuego went to a second round as the candidate from the ruling Victory Front alliance failed to get 50 percent of the votes needed to win. In Santa Fe province, a recount is ongoing after the vote was split three ways.Scioli would obtain 34 percent of intended votes compared with 27 percent for Macri for the Oct. 25 elections, according to a Poliarquia poll of 1,000 people taken during the first two weeks of May with a margin of error of 3.2 percentage points.By Merilyn Jackson23 June 2015Would you know the moment when you must flee your homeland? Where do you think is the safest place to go? What do you do once you find it isn’t a welcoming haven? How do you navigate the roadblocks of immigration, citizenship, language?These are questions choreographer Silvana Cardell and artist/sculptor Jennifer Baker asked themselves and their collaborators a year ago when they began work on Supper, People on the Move. The multimedia project runs Thursday through Sunday in Crane Arts’ Icebox space, with a free simulcast Friday evening on Independence Mall.Cardell has her own immigrant story. In the mid-1980s when she left Argentina for Philadelphia, she was not fleeing persecution or seeking asylum; she came to study dance at the University of the Arts, and returned to Buenos Aires to direct Armar Danza Teatro and her own company, S. Cardell Danza. Then, in 2002, she and her architect husband, Pablo Meninato, and their two children moved permanently to the Philadelphia area. With a master’s degree in choreography from Temple, she now directs Cardell Dance Theater and the dance program at Georgian Court University in Lakewood, Ocean County.In her sunny Fairmount living room, she talked over a carafe of strong coffee about her family’s experience. Her children “had visitors’ visas until we had a green card in 2007,” she said of their long path to citizenship. “Pablo, Lorenzo, and I became citizens in 2013. Paula is still on a green card.” (Both children are now in college.)But the family’s journey, though lengthy, did not involve the crushing hardships many endure in order to get to the United States and make their way in their new home. Contemplating those stories is what planted the seed for Cardell’s ambitious performance piece – specifically, an invitation to speak at her own citizenship ceremony.“I looked at all those faces yearning to be made Americans, and the enormity of it all finally hit me. I’m interested in performance theory and how you create social art, so I talked with [choreographer] Merian Soto, who has done a lot in that field, and invited her to be in the piece as a guest artist.”Cardell is a collaborative artist. At UArts, she wrote her thesis with feminist cultural critic Camille Paglia and studied with other humanities professors because “I didn’t want to just study dance or choreography. I wanted to learn about philosophy and analysis of art and criticism. I did a lot of arts research, for example, on installation art.”Jennifer Baker, Supper’s visual artist, has worked with Cardell before, most remarkably in NOW!, in which she drew life-size impressions of its cast in real time as they danced. She is designing the “Supper Table” and the costumes, and curating Portraits of People on the Move, a companion exhibition displaying individual photos and stories of immigrants in the Philadelphia region based on her interviews with 52 people.“The shortest time I spent with anyone was an hour and a half,” Baker said. “I was so focused on how they wanted to tell their own stories. All of them will be on the blog [supperdance/supper-blog] and portfolio, and 14 will be in the exhibit. I took 11 of the portraits, but mostly used photos they sent me, because it’s not an exhibit of my photographs, but how these people want to be seen.”It was sometimes difficult to get people to talk, she said. “For many, it was very painful to revisit their experience. Some came forward only at the last minute.”Their stories, told with wonderful candor, range from an Ecuadoran woman’s description of her harrowing, months-long odyssey to a Canadian’s conflicted feelings about living in the U.S.; from accounts of being driven from home by fear and misery (Nigeria, Albania) to tales of domestic and economic woes at this end – or, just as often, hard-won success and satisfaction.For a soundscape, Cardell sought a composer who could work with the resonant qualities of the echoing Icebox Project Space and create the right sonic atmosphere. A Pew funder suggested Nick Zammuto, founder and onetime half of the band the Books, an inventive duo invested in found sounds and folk melodies. Now based in Vermont, he creates dada energy, international vibes, and contemporary incisiveness with his eponymous band, Zammuto. In Supper, you’ll hear sounds like the creaking of a ship’s hull.“He came to Philadelphia to investigate the acoustics of the IceBox space,” said Cardell. “I gave him a Bach partita we’d been working with, just to give him an idea of the tempo and beat we wanted. I love what he’s created, especially the sonic imagery of the heartbeat during the duet” with Bethany Formica and William Robinson.At a recent rehearsal, the hour-long work brought to mind the body formations of Bella Lewitsky’s work, once described as “docu-dance.” Clusters of dancers crash together, uplift and crawl over one another, then explode away from the group as individuals – the dynamics of the dance mirroring the dynamics of immigration.“I was looking for an essence,” Cardell said, her hand groping the air. “I didn’t want to use texts.” But she does use a number of props, including eight large and dangerous-looking folding tables. “The objects that I use have to be super emblematic. I have to find objects that can be many things. There is nothing in the performance that is not used more than once. I have to figure it out why it is there and use it until I have no more use for it.”Because food is a major component of the immigrant experience – the lack of it, memories of family meals, elaborate farewell dinners – it’s a component of Supper, as well.During the performance, at the supper table – a place of solace and community – the bodies twist away from one another. But at the end of the journey, the dancers and Merian Soto, who holds together the space that everyone else has left, will distribute supper – empanadas and burritos – to members of the audience, inviting them to share a meal. And, perhaps, a story.DANCESupper, People on the Move8 p.m. Thursday-Sunday at Icebox Project Space at Crane Arts, 1400 N. American St. (free simulcast Friday on Independence Mall).Tickets: $15-$20.Information: supperdance.com.
MONDAY, JUNE 22ND
8. IT’S PATAGOMANIA ; AN END OF THE WORLD WITH ITS OWN FLORA AND (WOOLLY) FAUNA, POPULAR WITH ADVENTURERS FOR ITS GRANITE TOWERS, GLACIERS, AND HUGE ICE FIELD (The Boston Globe)9. ICE, ARGENTINE OFFICIALS TRAIN TO COMBAT SEXUAL EXPLOITATION OF CHILDREN (Imperialvalleynews.com)
June 21, 2015BUENOS AIRES, Argentina — President Cristina Fernandez of Argentina won’t seek another office when her second term ends Dec. 10, defying recent speculation she might run for congress.With the passage of the filing deadline at midnight Saturday, Fernandez’s name did not appear on any list of candidates. She is barred by Argentina’s constitution from seeking a third presidential term.Expectations had been rising that Fernandez might not be willing to leave government completely after holding public offices for more than two decades and many speculated she could decide to lead the congressional slate in Buenos Aires province.Her son Maximo Kirchner, however, is seeking a seat in the House of Deputies for Santa Cruz province. He is the son of Fernandez and the late Nestor Kirchner, who preceded his wife as president.Fernandez still is expected to remain an influence in the left-of-center Front for Victory coalition that has supported her policies of government intervention in the economy.By Camila Russo and Andrey BiryukovJune 19, 2015Argentina’s Economy Minister Axel Kicillof said the government is considering selling more dollar bonds this year amid strong investor demand for the nation’s debt.“I have seen the spectacular response of the market when we went with our new bonds so I think that this is a possibility,” Kicillof said in an interview in St. Petersburg, Russia, when asked about issuing more dollar debt in 2015.The 43-year-old minister said any new debt should be used to finance development projects like infrastructure and that Argentina wants to have capital market access to solve “real economic problems.”In April, Argentina sold an additional $1.4 billion of its 2024 bonds, triple the amount originally offered. The sale was done in the local market as a legal dispute with holders of defaulted bonds from Argentina’s 2001 economic crisis is preventing the country from raising funds in the international market. The government has $6.26 billion of bonds coming due in October and an attempt to swap part of those notes for longer dated maturities in December was largely unsuccessful.The so-called Bonar 2024 bonds fell 1.2 cent to 94.65 cents on the dollar at 2:24 p.m. in Buenos Aires, according to data compiled by Bloomberg. The yield rose 0.22 percentage point to 9.86 percent, the highest since Dec. 17.Kicillof said Argentina is ready to resume talks with holdout creditors led by billionaire Paul Singer’s NML Capital as long as the litigating hedge funds don’t insist on getting “scandalous returns.” The last time Argentina met with holders of defaulted debt who were awarded full payment in a U.S. court was last July, he said.“It’s not fair to bondholders that entered in our restructuring processes,” Kicillof said. “We want a solution for 100 percent of the bondholders. We give them messages that we are ready to discuss, but in rational terms. Without extortion.”By Hugh BronsteinJune 21, 2015Argentina’s Cristina Fernandez will step down as president in December, but her influence may remain strong enough to impede investment-friendly reforms in Congress if her ruling party wins legislative elections in October.Ending speculation she might run for Congress herself, the outgoing two-term president is letting her economy minister, the architect of her interventionist policies, lead the Front for Victory party’s fight to retain control of the House and Senate.“The candidate is the project,” Economy Minister Axel Kicillof told local radio on Sunday, following the deadline for candidates to register ahead of the August party primaries.“Those of us who represent the Front for Victory will be there to carry on and deepen a project that is now 12 years old,” he said, referring to Fernandez’s eight years in power and the four-year presidency of her predecessor and late husband Nestor Kirchner.Argentines will go to the polls on Oct. 25 to elect a new Congress and president. If Fernandez’s allies keep control of both legislative chambers, it may slow any market-friendly reform efforts by the next president, who is scheduled to take office on Dec. 10.The government’s fiscal accounts have deteriorated under Fernandez, who is barred from seeking a third consecutive term in October but may run for the presidency again in four years, while heavy-handed trade and currency controls have slowed the economy to a crawl.Fernandez’s son Maximo Kirchner, leader of his mother’s “La Campora” activist youth organization, is running to represent the southern province of Santa Cruz in Congress.Front-running presidential candidate Daniel Scioli, who is a member of Fernandez’s party but favors a more pro-market approach to policy, has named Fernandez’s top legal advisor, Carlos Zannini, as his running mate.“Zannini’s nomination together with the packing of Front for Victory legislative tickets with ‘Cristinista’ hard-liners will affect investors’ perceptions about policy change,” said Ignacio Labaqui, an analyst with Medley Global Advisors.“Scioli’s ability to make a clean break from Cristina might be negatively affected by her influence after the end of her presidential term,” Labaqui said.A Congress loyal to Fernandez could also hamper her successor’s efforts to put the country’s 2002 sovereign debt default behind it. The country is in a protracted legal battle with bondholders who rejected the roughly 70 percent reduction in payment terms offered by Argentina’s 2005 and 2010 debt restructurings.Argentina defaulted again last year when a U.S. judge barred it from paying restructured bonds without settling with the “holdout” investors.By Hugh BronsteinJune 19, 2015Argentina’s presidential contender Mauricio Macri on Friday picked a business-friendly senator with middle class appeal as his running mate, reinforcing his center-right challenge to the ruling party’s ticket.Senator Gabriela Michetti will join Macri in his campaign against front-runner Daniel Scioli, governor of Buenos Aires province. Scioli is allied with outgoing leader Cristina Fernandez, whose heavy-handed trade and currency controls have slowed Latin America’s No. 3 economy to a crawl.By picking Michetti, Macri confirmed his image as the candidate most likely to break with Fernandez’s policies, which have scared off investment in Argentina’s vast but barely developed shale oil fields. Scioli had already picked one of Fernandez’s closest advisors as his vice presidential candidate.The senator got her start in politics in 2003, years after being left in a wheelchair by an auto accident. A charismatic campaigner, the 50-year-old Michetti is popular among middle class voters and may attract support from outside Macri’s urban professional base.Michetti has been a stalwart of Macri’s Republican Proposal (PRO) party during her 12 years in politics.“Gabriela loyally represents all the values we have fought for,” Macri said.Her candidacy might also help him with voters offended by comments he made last year that were criticized as being sexist.In a radio show on the issue of catcalling, Macri defended the practice, saying “deep down all women like compliments.”“Some say ‘no, that’s offensive’, but I don’t believe any of that … Even if you say something rude, like ‘What a cute ass you have’… it’s all good,” Macri said.Fernandez is constitutionally barred from running for a third consecutive term in October. She is expected to try to remain influential after leaving the presidency in December, and may even run for the top job again in four years.Scioli is from Fernandez’s Front for Victory party, although he has positioned himself as more orthodox than her on economic matters. Scioli’s choice of the president’s key legal advisor Carlos Zannini as his running mate was panned by markets as a sign that his investment-friendly leanings may be constrained by Fernandez.Argentine bond prices fell on the announcement of Zannini’s candidacy for the vice presidency.“Argentina is headed towards a challenging and difficult transition,” said Eurasia Group analyst Daniel Kerner, adding that Scioli is likely to resist pressure from Fernandez to continue her policies and would be better positioned than Macri to manage the shift to a new government.“The risk that he fails, however, is not trivial,” Kerner said.The Michetti announcement was widely expected by markets and did not move bond prices on Friday.June 21, 2015Argentine President Cristina Fernandez will not run for any office in this year’s elections, but she has set up supporters in key candidacies for the primaries in which 13 presidential hopefuls are participating.The president’s decision not to run for any office was a big surprise when the registration deadline passed at midnight on Saturday, given that many in the local press had speculated that she would run for at least a Mercosur parliamentary seat with an eye toward obtaining legislative exemption and other benefits.Fernandez, who will leave the presidency on Dec. 10 when her second term ends, however, has put several of her ministers and influential La Campora leaders, including the founder of that group, her own son Maximo Kirchner, into candidacies of their own.La Campora is a political youth organization that supports Fernandez and the agenda of her late husband and predecessor Nestor Kirchner.“If and when the judicial situation and that of her entourage doesn’t substantially worsen, the president probably will seek seclusion starting in December at El Calafate, her ‘place in the world.’ Perhaps she will also devote herself to making international speeches – something that fascinates her,” analyst Patricio Giusto, the director of the Diagnostico Politico consulting firm, said Sunday.The president also has seen to it that the governing Front for Victory’s sole candidate for president in the Aug. 9 primaries, Buenos Aires Gov. Daniel Scioli, is a close confidant of hers and will guarantee the continuity of the Kirchnerist political movement if he wins the election in October.Carlos Zannini, the legal and technical secretary to the presidency since May 2003, when Kirchner became president, will be Scioli’s running mate.Although Fernandez will not be running, she will pull in votes if she involves herself actively in the campaign, said analyst Rosendo Frage, with the Nueva Mayoria consulting outfit.Maximo Kirchner, 38, will head the governing party’s list of parliamentary candidates for Santa Cruz province, the cradle of Kirchnerism.“If Scioli loses, … at least the continuity of Kirchnerism is guaranteed via the significant legislative representation it will have,” said Giusto, adding that Fernandez “leaves the presidency looking toward 2019, whoever wins this year.”Voter surveys agree at present that Scioli is favored by a plurality of between 30 percent and 35 percentBy Charles Newbery19 June 2015Buenos Aires (Platts)–19Jun2015/1131 am EDT/1531 GMT Argentina’s state-run energy company YPF is looking at a potential partnership with Russia’s state-owned Gazprom for developing the country’s large unconventional resources, CEO Miguel Galuccio said Friday.The joint venture would be “to find niches where we can complement each other,” Galuccio said at the St. Petersburg International Economic Forum, according to a statement by the Argentine Economy Ministry.“Russia today has the resources and scale that Argentina does not have, and this could enhance the development of our fields,” Galuccio said. “Russia has know-how and the service companies, such as in seismic and directional drilling.”This is the latest move toward a partnership between the companies, which has been in the cards since shortly after YPF came under state control in 2012.Argentina has turned to Russian banks and state companies for investment in building hydroelectric and nuclear power plants, as well as for oil services. A next step would be for Gazprom to start working in the upstream sector, in particular for drilling for natural gas resources.Argentina is running a 30% gas deficit, which it is plugging with costlier supplies from Bolivia and the global market, a drain on its tight dollar reserves. While domestic gas prices range from $3.70-$7.50/MMBtu, it is paying $8-$12/MMBtu for imported supplies.Argentinian President Cristina Fernandez de Kirchner has set as a goal to return the country to the energy self-sufficiency of the late 1990s and early 2000s. YPF is investing $7 billion/year to rebuild oil and gas production after a decade of decline, including by wringing more out of maturing reserves and putting into production giant resources in shale and tight plays including Vaca Muerta, among the largest in the world.Since coming under state control, YPF has increased gas production by 25% and oil by 10%, Galuccio said.“We foresee good prospects for future production,” Galuccio said. “We have the resources and we are able to exploit them.”To put more of the shale and tight resources into production, Galuccio said YPF needs more partners.It has already teamed with Chevron, and they are producing about 42,000 b/d of oil equivalent from Vaca Muerta, the first shale oil produced outside of North America. Another partnership for shale oil started this year with Malaysia’s Petronas, while ventures with Dow Chemical and Argentina’s Petrolera Pampa are producing tight gas.“We are producing 3% of the Vaca Muerta play, and we are looking for partners to come to Argentina and invest with us,” Galuccio said. “This would give Argentina a scale that would make it possible to reduce costs.”By Will Greenberg22 June 2015The “Safety Truck” is a Samsung creation that equips trucks with front-facing cameras that display to screens in the rear.In Argentina, traffic accidents are one of the leading causes of death but a new creation of Samsung’s is hoping to change that.The “Safety Truck” is a Samsung creation that equips trucks with front-facing cameras that display to screens in the rear that show trailing drivers what’s coming ahead. With extra visibility, drivers looking to pass the truck would no longer need to drive into the opposite lane to see if another vehicle is oncoming.A recent blog from Samsung Tomorrow noted the need for increased safety on Argentina’s roads and said their new trucks intend to “save lives.” The blog also features a video demonstrating how drivers interact with the truck. In it, Samsung notes Argentina’s high rate of traffic accidents, attributing it to the country’s many two-lane roads.The camera is equipped with night vision and should also help drivers be more prepared in the event of a sudden stop if, say, an animal jumps out in front of a truck. The company said the technology is proven to work.The blog post said the prototype truck was developed by a “local B2B client” but that it is no longer operational. The company said its next step is to work with NGOs and local government to “perform the corresponding tests in order to comply with the existing national protocols and obtain the necessary permits and approvals.”While the idea has the potential to increase road safety, it’s unclear how soon before anyone will see a Safety Truck on the road. Cost-efficiency could be an issue as the screens necessary for driver viewing are expensive, The Verge reported.Other recent advances in truck-related technology also include automated driving. Daimler Trucks North America unveiled their self-driving trucks in May in Nevada. However, much like the Samsung trucks, they will need national regulations changed before they are widely used.8. IT’S PATAGOMANIA ; AN END OF THE WORLD WITH ITS OWN FLORA AND (WOOLLY) FAUNA, POPULAR WITH ADVENTURERS FOR ITS GRANITE TOWERS, GLACIERS, AND HUGE ICE FIELD (The Boston Globe)By Rick Warner21 June 2015LOS GLACIARES NATIONAL PARK, Argentina — Following a brisk hike on the Perito Moreno Glacier, my wife and I shared a toast with our fellow trekkers, raising glasses of whiskey sprinkled with crushed ice from the frozen water beneath our crampon-strapped boots. We dubbed it Scotch on the glacial rocks.The celebration occurred in Los Glaciares National Park, part of a natural wonderland in southern Argentina known as Patagonia. Split between Chile and Argentina, it’s a South American version of Alaska with snow-capped mountains, blue-tinged glaciers, pristine waterfalls, and a cornucopia of plants and wildlife.To most Americans, Patagonia is a company that makes trendy outdoor clothing. It was also one of the South American hideouts used by Butch Cassidy and the Sundance Kid before they were gunned down by Bolivian soldiers in a shootout immortalized in the 1969 movie starring Paul Newman and Robert Redford.Today, it’s a mecca for hikers, campers, climbers, and other outdoor enthusiasts from all over the world, a booming tourist area where backpacks are as common as empanadas.After flying from New York to Santiago, we spent three days in the Chilean capital before flying to Punta Arenas, a scenic city near the country’s southern tip.As part of our tour package, we were picked up at the airport and driven to our hotel in Torres del Paine National Park, a five-hour trip on a highway known as Fin del Mundo, or “end of the world” in Spanish, a fitting description for a remote region that has Antarctica for a neighbor.About halfway between Punta Arenas and Torres del Paine, we stopped for lunch at the Cerro Negro ranch, which is owned by the descendants of a Croatian immigrant who came to Patagonia in the early 1900s. (The family also owns Las Torres, the hotel we stayed at in Torres del Paine.) The ranch has 1,600 sheep and 300 cows, along with horses, goats, ostriches, and guanacos, speedy llama- like creatures prevalent in Patagonia.It was the start of sheep-shearing season — the animals are bathed and sheared once a year — so we got to see the process in person.The shearers work at a frenetic pace, trimming hundreds of sheep per day. A ranch hand told us the wool was headed for China, the world’s largest wool market.When we finally arrived at the entrance to Torres del Paine, several vehicles were stopped near a bridge where a puma was prowling. There are only 50 to 75 pumas in the 600,000-acre park, and they are are easily camouflaged, so sightings are relatively rare. By the time we got to the bridge, the puma was gone.Our rustic hotel was surrounded by frosted mountains and set in the middle of a working ranch, where beret-wearing gauchos herded horses outside our window every morning.The park is teeming with guanacos, a staple of the puma’s diet. We saw hundreds of skeletons, especially near fences, where pumas stalk guanacos that stumble while trying to leap over the barriers. We didn’t see any pumas until our third and final day in Torres del Paine, when my wife spotted a bobbing head in the distance.Pumas and guanacos are part of the park’s diverse fauna, which includes dozens of mammals and more than 100 bird species. We saw condors, eagles, vultures, rheas (flightless birds related to the ostrich), hares, foxes, and even pink flamingos. There are also 250 kinds of plants, including the calafate, a thorny bush that produces bright yellow flowers and dark berries.It’s almost always cold in Patagonia, regardless of the time of year, and the whipping winds don’t help. We were there in October, and the only jacket I brought was a light windbreaker. Big mistake. If you’re planning to go, pack as if you’re going on a ski trip, even during the summer.The park’s mountain range is marked by a trio of jagged granite peaks known as the Three Towers, ranging in height from 7,400 to 8,200 feet. Adventurous mountaineers regularly scale the peaks, though it requires a special permit and lot of climbing experience. I’m a daredevil who has skydived, paraglided, and bungy jumped, but my wife persuaded me that if I tried to climb one of the towers, it would be a one-way trip.From Torres del Paine we traveled to El Calafate, the closest town to Los Glaciares National Park. The trip took longer than scheduled because we got stopped at the Chile-Argentina border for two hours as guards questioned our driver about his license and passenger list. The guards let us through only because phone problems prevented them from finding another driver.The following day, we traveled by bus and boat to Perito Moreno Glacier, named after Patagonia explorer Francisco Moreno. After docking, we walked a short distance, stopped to put on crampons, and began our trek on the famous glacier that is part of the Southern Patagonian Ice Field, the world’s third-largest behind Antarctica and Greenland.Perito Moreno is one of the few glaciers in the world that is growing, not shrinking. Scientists have offered various explanations, but nobody is really sure why. Even so, we saw large chunks of ice splitting off into the water, a natural process known as calving that can produce huge waves and a loud cracking or booming sound.When we returned to El Calafate, a thriving tourist town that serves as the gateway to Los Glaciares, we visited an ice bar that’s attached to a futuristic glacier museum. Almost everything inside is made of ice, including the glasses and tables. Everyone is given an insulated silver jacket to wear, and you can only stay for 20 minutes. The $16 admission price includes all you can drink before your lips go numb.9. ICE, ARGENTINE OFFICIALS TRAIN TO COMBAT SEXUAL EXPLOITATION OF CHILDREN (Imperialvalleynews.com)June 19, 2015Buenos Aires, Argentina – U.S. Ambassador to Argentina Noah B. Mamet and Buenos Aires State Attorney Martin Ocampo welcomed more than 150 law enforcement officials from throughout Argentina Monday for a one-day international training focused on combatting the online sexual exploitation of children.U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Southern Cone of the Americas Attaché Office co-hosted the event with the Buenos Aires Ministerio Publico Fiscal’s investigative unit known as Red 24/7.Law enforcement experts from the United States and Argentina traveled to Buenos Aires to partake in the training. Judges, prosecutors and investigators, representing various states throughout Argentina, participated.Experts from the International Center for Missing & Exploited Children (ICMEC), the National Center for Missing and Exploited Children (NCMEC) and the International Association of Internet Hotlines (INHOPE) provided numerous training sessions and presentations discussing cutting-edge technology in the fight against the sexual exploitation of children.Ambassador Mamet said, “The United States and Argentina stand united as we tell child predators that they will be brought to justice. We are here to send the message that we will work together to find them, arrest them and ensure they never hurt another child.”“Protecting children from online sexual predators is paramount,” said Buenos Aires State Attorney Ocampo. “Last year alone, we tragically saw a 125 percent increase in these types of cases. Thus far this year, we’re approaching 800 cases. Trainings such as these are critical in helping us build the networks we need to operate quickly.”“When it comes to protecting children, there are no barriers or borders to stop us,” said HSI’s Southern Cone of the America’s Attaché Eddie Agrait. “We are committed to working with our Argentine counterparts in this important global fight.”HSI encourages the public to report suspected child predators and any suspicious activity through its toll-free Tip Line at 1-866-DHS-2-ICE or international number at 802-872-6199.For additional information about wanted suspected child predators, download HSI’s Operation Predator smartphone app or visit the online suspect alerts page.HSI is a founding member and current chair of the Virtual Global Taskforce, an international alliance of law enforcement agencies and private industry sector partners working together to prevent and deter online child sexual abuse.
8. OFFICIAL ARGENTINE INFLATION FIGURES POINT TO SLIGHT DECELERATION IN MAY (IHS Global Insight Daily Analysis)By Benedict Mander, Buenos AiresJune 17, 2015President Cristina Fernández de Kirchner has dashed investor hopes of a radical change in Argentine economic policy when she steps down after elections this year by imposing one of her most radical advisers as the running mate of the lead candidate Daniel Scioli.Mr Scioli, the 58-year old governor of Buenos Aires province, late on Tuesday named Carlos Zannini as his vice-president and running mate. Analysts said the choice was made for him by Ms Fernández in return for her endorsement, which he needs to win the close-run election.“We expected [the president] to name someone that would allow her to constrain Scioli. But this was beyond our expectations,” commented Eurasia Group, the risk consultancy. Mr Zannini, the president’s legal secretary, is known in Buenos Aires as “el chino” because of his interest in Maoist philosophy.Argentine markets — from stocks and bonds to the currency — fell on Wednesday on the news. Investors have bid up Argentine assets on the hope that the end of Ms Fernandez’s presidency increased the probability of a deal with holdout hedge fund creditors, and so reopen Argentina to international capital markets.While Mr Scioli has campaigned on a ticket of broad continuity, amid promises to make some necessary adjustments to boost Argentina’s struggling economy, his main opponent, the mayor of Buenos Aires city, Mauricio Macri, has run his campaign on a message of wholesale change.“The formula of Daniel Scioli and Carlos Zannini represents the continuity of the most successful political project in the history of Argentine democracy,” tweeted Santiago Montoya, a close ally of Mr Scioli and president of Grupo Provincia, a financial corporation.However in the camp of the centre-right Mr Macri, the news was welcomed as evidence that Mr Scioli was just a pawn of the outgoing leftist president, and that a stronger association with Ms Fernández would cost him support among wavering voters in the centre. Some 65 per cent of the population favours political change, according to the opposition.The polarisation of the election campaign, which earlier this year was seen as a three-way race, has resulted in votes migrating away from third place candidate Sergio Massa, a former cabinet secretary who has attempted to position himself in the middle ground.If Mr Scioli wins the elections, the appointment of Mr Zannini, who has been a close adviser to Ms Fernández and her late husband and predecessor Néstor Kirchner since the 1980s, bodes poorly for the post-election policy outlook, said Daniel Kerner at Eurasia Group.Limiting Mr Scioli’s ability to break away from government policy, Mr Zannini could hamper a resolution with Argentina’s so-called “holdout” creditors, whose victory in a long-running legal battle in the US is blocking the country’s access to international markets.“As economic constraints become more acute, Scioli will be forced to make more serious changes. But the transition will be difficult and slower than investors anticipate,” said Mr Kerner.By Daniel CancelJune 18, 2015Argentina’s Daniel Scioli will be the only presidential candidate from the ruling Victory Front alliance after his rival Florencio Randazzo pulled out of contention, a government official said.Randazzo “bowed out as presidential candidate and doesn’t want to run for governor of Buenos Aires province,” Cabinet Chief Anibal Fernandez told reporters this morning. “He’ll remain in the cabinet” as Transport Minister.Scioli, the 58-year-old governor of Buenos Aires province, announced Carlos Zannini as his running mate on Tuesday, upending the internal battle to succeed President Cristina Fernandez de Kirchner. Zannini, who has been Legal Secretary and a close adviser to Fernandez and her husband and predecessor Nestor Kirchner for three decades, assures the continuity of the political model, Scioli said.Trailing in polls to Scioli, Randazzo campaigned on fixing railway infrastructure and replacing outdated train cars. While he said he was the preferred candidate of the president, Fernandez never explicitly endorsed either. The naming of Zannini as Scioli’s vice president was an inexplicit endorsement, according to Eurasia Group.Scioli either leads or is in a technical tie in opinion polls against main opposition candidate Mauricio Macri. The general election will be Oct. 25 followed by a second round Nov. 22 if needed. The new government will be sworn in on Dec. 10.By Pablo Rosendo Gonzalez and Daniel CancelJune 17, 2015Daniel Scioli, the favorite to win Argentina’s presidential election in October, chose a close aide to President Cristina Fernandez de Kirchner as his running mate, triggering a dive in bonds.Scioli, the 58-year-old governor of Buenos Aires province, named Carlos Zannini as his vice president candidate, saying he represented continuity of the political project led by Fernandez and her predecessor and husband Nestor Kirchner, who have ruled Argentina since 2003.Zannini, a 60-year-old lawyer from Cordoba province, has been Legal Secretary for the government for 12 years.“I consulted the president on this issue,” Scioli, a member of the ruling Victory Front alliance, said in an interview with the C5N television network. “Picking Zannini, a founding member of this movement with a history of proximity to Nestor and Cristina, gives certainty.”The appointment tightens Scioli’s links with Fernandez and strengthens his chances of winning in the first round of voting on Oct. 25, according to Eurasia Group. Even as Argentina’s economy has stagnated amid annual inflation of about 25 percent, Scioli has widened his lead in recent opinion polls as he promises to maintain spending on welfare programs that benefit a quarter of the population.Government notes due 2024 fell 2.28 cents to 95.8 cents on the dollar, the lowest level since Dec. 18. The extra yield investors demand to hold Argentine debt over U.S. Treasuries widened 0.25 percentage point to 6.13 points at 4:34 pm in New York. On average, the yield spread in emerging markets fell 0.01 percentage point, according to JPMorgan Chase & Co.Zannini said that after speaking with Fernandez he had accepted Scioli’s offer.“It’s the continuation of a path,” he told reporters in Buenos Aires.Kirchner DynastyFernandez’s influence will become even clearer on Saturday when the deadline ends for parties to nominate candidates for president and vice president as well as congressional offices and the Mercosur parliament. Fernandez and her son, Maximo Kirchner, may choose to run as lawmakers for the province of Buenos Aires.“Now the focus will shift to what role will CFK play in the elections, and if she will run for an elective position,” Citibank analyst Fernando Jorge Diaz wrote in a note to clients.Zannini, who rarely speaks in public, has been central in drafting legislation for both Kirchners and appeared in Congress last year to defend projects to compensate Spain’s Repsol SA for a 2012 seizure of assets by the state.‘Legal Architect’“He has been the legal architect and brain behind many controversial measures and policies of CFK,” Daniel Chodos, a strategist at Credit Suisse Group AG, said in an e-mailed response to questions. “The market is taking this negatively because this appointment reduces the chances of a change of the current model under a new government.”Having Zannini as vice president could signal policy continuity on the government’s position with holdout creditors demanding payment on defaulted debt, according to Eurasia.“While the vice president is not a particularly powerful figure, having a true CFK loyalist will increase the costs for Scioli of taking measures that CFK opposes,” Daniel Kerner, a Eurasia analyst wrote in a report. “This bodes particularly poorly for a deal with holdout creditors.”Opposition presidential candidate Mauricio Macri said Zannini was imposed on Scioli by Fernandez.“It’s coherent with everything they’ve been doing,” Macri said in comments broadcast on TN. “We are also going to be coherent in pushing for the change that Argentina needs.”Rally EndsZannini, who was a member of the Communist party, was jailed during the 1976-1983 military dictatorship. After the return of democracy, he moved to Santa Cruz province in Patagonia, where he met the Kirchners and worked with them as an adviser as they climbed their way up in national politics.Zannini didn’t reply to a telephone call seeking comment.Primary elections will be held Aug. 9, followed by a general nationwide vote Oct. 25. If needed, a second round will be held Nov. 22 before the new government is sworn in Dec. 10.Macri and Sergio Massa, the leading opposition candidates, have yet to announce their running mates.Argentine government bonds have rallied 13 percent this year compared with a 1.05 percent gain on average in emerging markets, according to JPMorgan Chase & Co. indexes. A Scioli government with key figures from Fernandez’s administration like Zannini however, is bad news for investors, according to brokerage BancTrust & Co.“The presumption that Daniel Scioli will have a much more market friendly posture can be questioned due to the naming of a person with such a Kirchnerism mind toward the market,” BancTrust said in a report.By Camila RussoJune 17, 2015Argentina’s stocks and bonds tumbled after presidential candidate Daniel Scioli’s selection of a close aide to President Cristina Fernandez de Kirchner as his running mate added to concern that she will remain influential and delay changes favorable to investors.Barclays Plc lowered the nation’s debt to neutral, saying in an e-mailed research report that the selection of Carlos Zannini would constrain Scioli, the governor of the Buenos Aires province and the favorite in polls to win the October presidential election. Scioli said Tuesday that Zannini, who has served as legal secretary for 12 years, represents continuity with Fernandez and her predecessor and late husband, Nestor Kirchner.“The market is pricing in that all the imbalances Argentina has to fix — related to the fiscal deficit, excessive subsidies, the overpriced peso and other issues — will be delayed,” said Juan Manuel Vazquez, the head of equity research at Buenos Aires brokerage Puente. “The market was expecting a quick change, and now we’re seeing that the imprint of Kirchnerism is sticking around longer.”Argentina’s benchmark 2033 bonds plunged 2 cents to 98.96 cents on the dollar, the biggest decline since December. The extra yield investors demand to own Argentine bonds over U.S. Treasuries widened the most in major emerging markets, according to JPMorgan Chase & Co.’s EMBIG Diversified indexes. The Merval, the country’s benchmark stock index, slid 1.5 percent, with 9 of its 11 members down.The nation’s American depositary receipts tumbled, with Grupo Financiero Galicia SA falling 6.5 percent, Empresa Distribuidora y Comercializadora Norte down 5.6 percent and Cresud SACIF slumping 4.1 percent.Stocks still have room to fall as much as 20 percent if Fernandez has a strong pull on the new government, Raymond James said in a research note.‘Kirchnerist Influence’“A strong Kirchnerist influence — and the appointment of Zannini could be the first sign of this — would reduce the new president’s room for maneuver, thus hindering the introduction of the corrective measures required to resume economic growth,” Raymond James analysts Federico Rey Marino, Santiago Wesenack and Fernando Suarez wrote.The appointment tightens Scioli’s links with Fernandez and strengthens his chances of winning in the first round of voting Oct. 25, according to Eurasia Group.Zannini, who was a member of the Communist party, was jailed during the 1976-1983 military dictatorship. After the return of democracy, he moved to the Santa Cruz province in Patagonia, where he met the Kirchners and worked with them as an adviser as they rose to power. Zannini didn’t reply to a telephone call seeking comment.By Hugh BronsteinJune 17, 2015(Reuters) – Argentine bonds weakened on Wednesday after presidential front-runner Daniel Scioli chose a loyalist of the current government as his running mate for the October election, a choice that may signal a continuation of policies that have deterred investment.Markets had hoped that Buenos Aires Governor Scioli would use his choice of a running mate to distance himself from the interventionist policies of outgoing President Cristina Fernandez.Instead, he said late on Tuesday that he had chosen Fernandez loyalist and legal advisor Carlos Zannini to run as his vice presidential candidate. Zannini said on Wednesday he had accepted the offer. He said Scioli’s ticket represented “the continuity of a path”.Fernandez, who is constitutionally barred from seeking a third consecutive term, has established a web of currency and trade controls that have frightened off investors who would otherwise be interested in Argentina’s promising shale oil and gas fields, as well as it already powerful grains sector.Argentine over-the-counter discount bonds closed 3.1 percent lower on Wednesday, market sources said.Argentina’s hard currency credits were by far the worst performers on Wednesday, according to the JPMorgan Emerging Markets Bond Index Plus (EMBI+). The yield spread of Argentine dollar-denominated bonds versus comparable U.S. Treasuries widened by 25 basis points. The index as a whole tightened 2 basis points.Scioli is from Fernandez’s Victory Front party, but is considered more in favor of open markets. Scioli has billed himself as the candidate of “gradual change” against the backdrop of a stagnant economy with double-digit inflation and limited access to global credit markets.Eurasia Group analyst Daniel Kerner said Zannini was imposed on Scioli by Fernandez, “given that Scioli needed her full support and endorsement to win the elections.”“We expected her to name someone that would allow her to constrain Scioli, but this was beyond our expectations,” Kerner said. “Zannini is one of her most important and influential advisors.”Whether Scioli as president could or would even want to marginalize Zannini and the Fernandez camp once in power remained an open question.Fernandez is faulted by Wall Street for inaccurate inflation reporting and her failure to put the country’s 2002 sovereign bond default to rest by reaching a deal with holders who rejected the steep cut in repayment terms offered by the country’s 2005 and 2010 debt restructurings.Argentina defaulted again last year after a judge ordered it to halt payment on restructured bonds until a deal was struck with a group of “holdout” investors who had resorted to the U.S. federal courts in their push for full repayment.Barclays downgraded Argentine bonds to neutral on Wednesday. It previously had an overweight recommendation, in part thanks to optimism about a possible settlement with holdout investors in 2016.“But it seems that her political strength has proven high enough to direct, to some extent, the potential next presidency. This leads us to change our stance to neutral,” Barclays said in a note to clients.June 17, 2015Daniel Scioli, the front-running candidate for the ruling Justicialist Party in Argentina’s presidential election, said Tuesday that he wanted Carlos Zannini, an adviser from President Cristina Fernandez’s inner circle, on his ticket as vice president.Scioli, currently the governor of Buenos Aires province, has billed himself as the candidate of “gradual change” against the backdrop of a stagnant economy with double-digit inflation and limited access to global credit markets.Yet his choice of running mate for the October presidential elections suggests he might steer a course more in line with Fernandez’s unorthodox policies than many supporters had hoped.Some analysts said it could just be a strategic ploy to win over Fernandez loyalists.Zannini, legal and technical secretary to the president, rarely makes public appearances but has been broadly described in local media as Fernandez’s right-hand man. Fernandez herself is constitutionally barred from a third consecutive term.The 60-year-old lawyer was nominated in 2003 by Fernandez’s predecessor and late husband, Nestor Kirchner.“I spoke with Cristina and gave her my point of view. I had said I wanted someone who would complement me in experience,” Scioli told TV broadcaster C5N.Candidates are required to list running mates when they register for the August primary by midnight Saturday.“[This choice] could cast doubts about Scioli’s willingness or ability to change the current economic policy,” said Ignacio Labaqui, who analyzes Argentina for emerging markets consultancy Medley Global Advisors.Argentine equity and bond markets have rallied in recent months on the expectation of such change.Scioli, who has pulled ahead of his two main rivals in recent polls, is walking a tightrope in order to win the support of both Fernandez loyalists and undecided voters demanding change.A moderate within the broad Peronist movement that has ruled Argentina for all but eight years since the return of democracy in 1983, Scioli is more pragmatic and pro-market than Fernandez and says policy changes are needed to get the economy moving.But the jury is out on how much change he would truly bring about. He has mostly been vague about specific policies.Argentina’s next president will inherit a broken economy by most standards: inflation running at 20 to 25 percent, low foreign reserves, a gaping fiscal deficit fueled by hefty subsidies, negative real interest rates and a debt default.Alejo Czerwonko, emerging markets economist at UBS Wealth Management, said Scioli’s choice of running mate made sense politically because he needed Fernandez’s endorsement. He also said the choice did not necessarily reflect Scioli’s future policies.Scioli’s behavior, “if and when he sets himself free” from Fernandez and controls government resources himself, “remains anyone’s guess,” Czerwonko said.By Dimitra DeFotisJune 17, 2015As the ballot for president in Argentina is taking shape, outgoing President Cristina Fernandez de Kirchner may hold most of the cards.Getty ImagesArgentina’s main presidential candidate from the incumbent party, Frente para la Victoria or VpV, announced a candidate Tuesday who is — according to “local consensus” — imposed by President Fernandez de Kirchner, according to Citi’s Latin America economics desk.Daniel Scioli, the main presidential candidate for the incumbent party, announced that Carlos “el Chino” Zannini will be his vice-presidential running mate. Citi writes:“Zannini is part of CFK’s [Cristina Fernandez de Kirchner’s] small inner cycle, together with her son Máximo Kirchner and Eduardo “Wado” de Pedro. Moreover, he has been close to the Kirchner family since its political beginnings in the Province of Santa Cruz in the 1980s. It is hard to imagine a “Kirchnerista” more “Kirchnerista” than him … He is also said to be one of the biggest supporters of La Cámpora, the political youth organization that has gathered significant influence during CFK’s tenure … In sum, yesterday’s news lowers the likelihood of a substantial change under a Scioli administration significantly, we believe. On the contrary, it shows that the Kirchnerism aims at keeping as much influence as possible … With the deadline to set the candidates coming closer (June 20), now the focus will shift to what role will CFK play in the elections, and if she will run for an elective position.”8. OFFICIAL ARGENTINE INFLATION FIGURES POINT TO SLIGHT DECELERATION IN MAY (IHS Global Insight Daily Analysis)By Paula Diosquez-Rice, Mario Guillen17 June 2015According to Argentina’s National Statistical Office (Instituto Nacional de Estadística y Censos: INDEC), consumer inflation was at 1.0% month on month (m/m) and 15.3% year on year (y/y) in May.The fastest increase in prices was observed in the clothing category, up 2.0% m/m, followed by household and basic services, up 1.6% m/m, and education, up 1.3% m/m. The leisure category posted a fall of 0.3% m/m. Meanwhile, producer inflation rose 1.4% m/m and 13.5% y/y.The inflation figures presented by the opposition in Congress point to higher levels, with prices in May rising 2.0% m/m and 28.76% y/y. Meanwhile, Torcuato di Tella University reports that inflation expectations for the next 12 months posted a slight reduction, standing at 28%, while average expected inflation in annual terms will fall to 27.5%, the lowest level since 2008.Relative stability in the foreign-exchange market and the perceived deceleration of inflation have improved expectations for short-term price trends, but uncertainty remains a key issue deterring investment from rising in the country. Such decisions are likely to remain on hold until after the presidential election in October.Debate over economic policy remains heated as talk points to a gradual dismantling of macroeconomic distortions rather than shock therapy, but increased spending before the election is likely to worsen the country’s already high deficit and increase the risk of drastic corrections.An easing of Argentina’s economic woes through a positive external shock remains unlikely, as the region continues to show lacklustre growth and commodity prices remain low. Although enthusiasm persists over the country’s natural resources and their economic potential, they should not be a substitute for much-needed structural economic reform.By Joseph CotterillJune 18, 2015The governments change, the debts change. The rhetoric, on the other hand…In light of the Greek prime minister’s recent ‘humiliation’ speech and the rather heated reaction it’s had among official creditors (and private bondholders) – we thought we heard some historical echoes. So we took a quick look through the archives.1) The anti-imperialist/romanticBut here we are, we suffer a circumstance, a reality, to which… we are going to give an adequate response, a realistic response… in which we pledge our moral, physical, historical presence… to what we owe to the western banks, and how we confront the IMF.So we will pay, but under what conditions we are going to do this, that depends on our anti-imperialist capacity not to be subjugated by the bad creditors…We want to clarify, properly and definitively, what that means… all servicing of external debt, including to financial institutions and countries, and commercial banks, will not take up more than 10 per cent of our total exports… paying 10 per cent means changing the terms, paying 10 per cent means varying the interest rates, paying 10 per cent means regaining independence and sovereignty. So far we have been ruled from without; now we begin to rule for ourselves.– Alan Garcia, President of Peru, speech to the United Nations general assembly, September 19852) The legalistic/pedanticI do not feel it is fair to define the so-called external debt of Argentina as indebtedness contracted by the Argentine state to external creditors, deserving of defining our position with the phrase: we should honour the assumed commitments. I feel that things are not so.We cannot forget that what some crudely call the so-called external debt, at least partially, is the greatest economic fraud ever seen in the history of Argentina (applause)…Let me be very clear; Argentina’s external debt has been paid without complying with the constitutional requirement that says it is given to Congress to regulate the payment of the nation’s external and internal debt (applause)…Let’s take the bull by the horns, let’s talk about the external debt. First I declare that the Argentine state will suspend paying the external debt (prolonged applause and shouts of Argentina, Argentina). This does not mean a repudiation of the external debt, it does not signify a fundamentalist attitude. Quite on the contrary, it is the first act of a government that has a rational stature in giving the issue of the external debt its proper treatment…Transparency is done, it is not proclaimed. Gentlemen, the books will be opened to you (applause).All monies that are provided in the budget for paying the external debt, while payments are suspended, will be used without hesitation and without exception, in plans of job creation and social progress (applause)…– Adolfo Rodriguez Saa, President of Argentina, speech to the Argentine congress, December 20013) The paranoid/messianicThe institutions’ persistence that we follow a program of austerity that has obviously failed, and their insistence on measures that they know we won’t accept cannot simply be a mistake, or a result of overzealousness.Chances are, their insistence serves political motives, as well as a political plan to humiliate not only the Greek government but also, our country…If the objective is to continue with an IMF-inspired program–widely acknowledged as having failed–and without addressing the debt, then we are left with no choice.We are obliged to not capitulate…It should be noted that the IMF, as well, bears criminal responsibility for Greece’s current state of affairs.After all, it was the IMF that erred on the multipliers, in its calculations on the recession.And while the IMF has apologized, this has done little to help those who lost their jobs to live a life with dignity, nor did it feed the thousands of poor and socially excluded.It did not increase pensions nor did it reopen small businesses that had gone under.The apology was merely a cynical confession made by technocrats that had no consequences.The time has come for the IMF’s proposals to be judged. And to be judged publicly.Not by us, but by Europe itself.The time has come for Europe to seriously discuss Greece’s future—and the future of the Eurozone itself.Does it want, by insisting on its stance, to lead a country and its people to humiliation and impoverishment or does it want to reach an agreement and to further democracy and solidarity?..– Alexis Tsipras, Prime Minister of Greece, speech to the Syriza parliamentary group, June 2015The difference, of course, is that Greece hasn’t actually defaulted yet, unlike in the Peruvian and Argentine examples. In Peru’s case, that default included IMF loans.On the other hand, if the Greek default announcement comes — the IMF and its fellow creditors will know what to look for.
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.
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.
3. ARGENTINA ECONOMY: QUICK VIEW – TRAIN NETWORK NATIONALISED (Economist Intelligence Unit – ViewsWire)By Charlie DevereuxMay 26, 2015Daniel Scioli’s grip on the candidacy for Argentina’s ruling party in October’s presidential elections may be weakening, according to an opinion poll, leading him to make concessions to President Cristina Fernandez de Kirchner.Interior Minister Florencio Randazzo, a Fernandez loyalist, would win 42.5 percent of votes in the August primary if he is backed by the president, according to an OPSM poll published Monday. Scioli, the governor of Buenos Aires province and a former vice president, is backed by 51.5 percent.The day before the poll was released, Scioli told Pagina 12 that Economy Minister Axel Kicillof, who Fernandez described last week as her right hand and closest adviser, would be a part of his government. The concession may have been triggered by Randazzo’s rising popularity, said Jorge Piedrahita, chief executive officer at Torino Capital LLC in New York.“Scioli in his speeches is talking to Cristina,” Piedrahita said by phone from New York. “His aim is to win Cristina’s support as soon as possible. Without her support he can’t win the elections.”Scioli’s spokesman Jorge Telerman didn’t immediately respond to a request for comment from Bloomberg News.‘One-Armed’Randazzo has criticized Scioli for hiding his true intentions and for his ties to corporations. The primary campaign has proved antagonistic at times. Last week, Randazzo had to issue a public apology after saying he chose to compete for the nomination because he feared Fernandez’s political project would be left “one-armed.” That was interpreted by many Argentines as a reference to Scioli, a former speedboat world champion, who lost his right arm when his boat flipped during a race in 1989.Scioli has been conspicuous by his absence at victory celebrations that Randazzo attended in provincial elections in Salta and Chaco, Piedrahita said.OPSM’s nationwide poll of 1,200 people interviewed between May 8-22 had a margin of error of plus or minus 2.5 percentage points. The same poll gave Scioli 32.2 percent of intended votes against 29.9 percent for Buenos Aires Mayor Mauricio Macri of the opposition Pro party in an eventual first-round election on Oct. 25.By Charlie DevereuxMay 26, 2015The baroque opera that is Argentine presidential politics is about to open a new act with two main characters — a one-time kidnap hostage calling for economic shock therapy and a one-armed speedboat champion who says to take it slowly.For the past dozen years, the inhabitant of the pink presidential palace has been named Kirchner, first Nestor, who died in 2010 from a heart attack, and then his widow Cristina Fernandez de Kirchner, both in the Peronist protectionist tradition.In October, voters will weigh in and polls show a tight race for a job not everyone would relish — leading a country mired in default, hemmed in by litigating hedge funds and ravaged by economic stagnation.Mauricio Macri, 56, the former hostage and current mayor of Buenos Aires, has cast himself as the change agent. He pledges to end currency controls, import restrictions and export tariffs to bring in investment and offset outflows forecast at half the central bank’s reserves.Markets would react to a Macri victory with euphoria, according to Siobhan Morden, head of Latin American fixed income strategy at Jefferies Group LLC in New York, but that may underestimate how difficult the controls are to dismantle.Polls show Macri about even with his main competitor, Daniel Scioli, the governor of Buenos Aires province and former world speedboat champion who belongs to the ruling Victory Front alliance.Boom, BustWhile agreeing that change is needed, Scioli says it should come only gradually.Whoever wins, the next government will need to ween Argentines off costly subsidies and price controls without putting hundreds of thousands out of work and slashing living standards.It has been a wild ride in recent years with benchmark bond prices swinging from 50 to 103 cents on the dollar and analysts are divided on the best path to stability. The economy went from collapse and default in 2001 to a boom that tripled income per capita in the nine years to 2012 and then back to stagnation and default.A U.S. judge is blocking payments on some foreign debt until the government settles with a group of hedge funds suing for better terms. Macri has said the ruling should be respected while the government vilifies the judge as a “vulture.”“Change through shock policies could result in an abrupt and perhaps counterproductive normalization,” Mauro Roca, senior economist at Goldman Sachs & Co., said by phone from New York. “On the other hand, if you go very gradually you’ll reach a point where other issues take priority and you don’t see the fruits of any changes.”Statistical TieA poll by OPSM showed Scioli and Macri about even — 32.2 percent for Scioli and 29.9 percent for Macri with a margin of error of 2.5 percentage points. Sergio Massa, who also vows to eliminate currency controls and lower taxes on grain exports, got 13.6 percent. The nationwide house-to-house poll canvassed 1,200 intended voters between May 8 and May 22.Scioli and Macri — both of whom declined to be interviewed for this article — came to politics indirectly. Macri, a civil engineer, worked for his father’s construction company and briefly as a credit analyst at the local unit of Citibank.Boca JuniorsHe got his first real taste of the spotlight when as president of Boca Juniors Football Club for 12 years, he modernized Argentina’s biggest soccer club. He refurbished the ‘Bombonera’ stadium and signed stars such as Diego Maradona, Juan Roman Riquelme and Carlos Tevez, paving the way for a golden age for the club which won 16 trophies.Macri said his interest in politics dates from his 1991 kidnapping. Ambushed outside his home, he was forced into a coffin in a Volkswagen van, La Nacion reported in 2001, citing court documents. For 12 days, he was chained to a basement floor blocks from his current city hall office before his father paid $6 million for his release. Macri rarely talks publicly about what happened.After two years as a lawmaker, Macri was elected mayor of Buenos Aires in 2007, winning re-election in 2011.Scioli’s family owned an electrical appliance business and he made his name as an offshore powerboat racer. Early in his racing career, in 1989 on Argentina’s Parana river, his boat hit a wave and flipped. He lost his right arm. Fitted with a prosthetic arm, he was back in a speedboat a year later and went on to win several world championships before retiring in 1997.Less DramaticAt the same time he won the concession to be distributor for Electrolux, the Swedish household appliance maker. Scioli, 58, was vice president under Nestor Kirchner for four years.Married, divorced, then back together with the same woman, Karina Rabolini, a former model with her own underwear and cosmetics line, Scioli is often seen campaigning alongside her.Scioli’s economic plans are less dramatic than Macri’s. In contrast to the mayor, he’s been supportive of the decision to default on the nation’s debt rather than comply with a court ruling and pay the litigating holdouts. He says he wouldn’t devalue the peso.Mocked for speeches that are often bland and substance-free, Scioli may actually be closer in outlook to Macri than at first appears, according to Jose Octavio Bordon, a former diplomat and presidential candidate. “At root his ideas aren’t all that different,” he said.‘Two Sciolis’While Macri may be the market favorite, Scioli’s track record in the province, which accounts for half of the country’s gross domestic product and where he changed the tax code, has impressed economists. In 2014, the province posted a budget surplus for the second straight year.It’s difficult to predict whether Scioli will be able to step out from Fernandez’s shadow to be able to implement changes, said Javier Kulesz, an analyst at Nomura Securities International Inc.“There are potentially two Sciolis the market should contemplate, one advocating policy continuity and another one policy change,” Kulesz said. “Instead of having three presidential candidates with a shot at becoming president, we practically have four.”3. ARGENTINA ECONOMY: QUICK VIEW – TRAIN NETWORK NATIONALISED (Economist Intelligence Unit – ViewsWire)26 May 2015EventThe president, Cristina Fernández de Kirchner, has enacted a law nationalising Argentina’s entire train network, the latest in a series of nationalisations by her political movement in the past decade.AnalysisThe bill nationalising Argentina’s entire passenger and cargo train network had been approved by Congress last month. The government had already been sporadically nationalising some services; updating lines and stations; and purchasing new Chinese carriages after several high-profile accidents, including one involving a commuter train in Buenos Aires, the capital, in 2012 that killed 51 people. This crash brought under scrutiny, even from some of its supporters, the government’s long-standing policy of heavily subsidising private companies who invested little in the lines.A new state train company, Ferrocarriles Argentinos Sociedad del Estado, will now oversee all of the country’s train lines. Even as the fiscal deficit widens, Ms Fernández said in her speech that state investment in lines and trains would cost a total of US$3bn. The government has already spent more than US$1bn on the new Chinese carriages. As it seeks to define a clear legacy of infrastructure improvements before the presidential election in October, the government has placed these purchases from China in the spotlight, drawing attention to them in Ms Fernández’s national broadcasts.The nationalisation plays to Ms Fernández’s supporters, and the tenor of her comments has been true to her populist style, recalling, for instance, the nationalisation of Argentina’s trains in the 1940s by a former president, Juan Domingo Perón. But the timing of the move points to a wider trend of her government stepping in only when the situation becomes dire. This was perceived to be the case, for example, with the nationalisation of Aerolíneas Argentinas (the state-run airline) in 2008.By Sarah Marsh26 May 2015BUENOS AIRES, May 26 (Reuters) – Argentina said economic activity grew a stronger-than-expected 2.0 percent in March, which private economists put down to a pickup in consumption and a bumper soy harvest, although they cautioned the data may be overly optimistic.Analysts polled by Reuters had expected a 0.8 percent rise in the monthly EMAE economic activity index, which is a close proxy for gross domestic product, in part due to a weak performance in the same month last year.Official data, especially for inflation that is running in double digits, has lost much credibility since President Cristina Fernandez took office in 2007.The government does not publish a breakdown of its economic activity index or any explanation. Analysts say it is likely skewed because it uses official inflation data.Still, strategist Alejo Costa at local investment bank Puente said early economic indicators for sectors like construction and retail suggested there was a slight uptick in Latin America’s third largest economy.Supermarket sales were up 7.2 percent on the month in March after falling in the previous two months, while the construction sector grew 1.6 percent in seasonally adjusted terms.“The economy seems to be picking up slightly but we don’t believe this will be enough for it to have sizeable growth this year,” said Costa. “It’s hard to know what is behind this figure.”Puente forecasts Argentina’s economy will contract 0.4 percent this year, returning to growth in 2016 with a 2.6 percent expansion on the back of government policy changes following presidential elections in October. Fernandez is constitutionally barred from a third consecutive term.Fausto Spotorno, an economist at local consultancy Orlando Ferreres and Associates said a record soybean crop likely also boosted economic activity figures in the grains powerhouse.Still, his consultancy estimated economic activity shrank 1 percent in March and forecasts a 1.6 percent contraction for the year.Separately, official data on Tuesday showed Argentina’s industrial output contracting 1.5 percent in the twelve months to April, marking the 21st consecutive monthly decline on the previous year.The figure was better than the median forecast in a Reuters poll of six analysts for a 1.9 percent fall.A steep economic downturn in key trading partner Brazil has hurt demand for Argentine automobiles while import restrictions introduced to protect Argentina’s low foreign reserves are also hurting manufacturers reliant on parts from abroad.26 May 2015BUENOS AIRES, May 26 (Reuters) – A group of crushers on strike for the past three weeks in Argentina’s main grains export hub said on Tuesday that the government had rebuffed a pay increase deal with employers.Soy trading in Rosario, which handles about 80 percent of Argentina’s grains exports, was virtually paralyzed for a sixth consecutive session as most exporters refrained from purchases to pressure the government to resolve the labor dispute.“We’ve reached a deal, the thing is the government won’t accept it,” Daniel Yofra, secretary general of the opposition-allied Industrial Oilseed Complex Workers Federation, said in an interview.Yofra said employers had agreed to a 36 percent salary increase to counter one of the world’s highest rates of inflation, significantly above the 27 percent raise ministers agreed to with two powerful pro-government unions last week. The crushers initially sought 42 percent.Argentina’s “paritaria” talks are negotiated between trade unions and private employers, with the government acting as a mediator with significant leverage over the outcome of discussions.“The problem is the government won’t allow that we close this deal here in the Labor Ministry. And the companies aren’t prepared to sign outside of the ministry,” said Yofra.Yofra’s union represents about 20 percent of crushers nationwide, and who mostly work in Rosario’s southern districts, where the dispute has slowed the loading of vessels.They have taken their protests to Rosario’s northern San Lorenzo district, blocking access to milling plants owned by companies such as Cargill and Louis Dreyfus Commodities BV.Even so, ports operated by the agribusiness companies have continued operating and the crushers’ industrial action has so far only had a marginal impact on international prices.Argentina is the world’s leading exporter of soyoil and soymeal and the fourth biggest corn exporter.By Fabiana Frayssinet26 May 2015BUENOS AIRES, May 23, 2015 (IPS/GIN) – In Argentina, where millions of families have unmet dietary needs despite the country’s vast expanse of fertile land, the Huerta Niño project promotes organic gardens in rural primary schools, to teach children healthy eating habits and show them that they can grow their own food to fight hunger.Of the 105 students who board Monday through Friday at the La Divina Pastora rural school in Mar del Sur in the municipality of General Alvarado, 80 percent come from poor families.“Ten percent have nutritional deficiencies, from their first year of life, even from the period of breastfeeding or even the pregnancy itself. We see calcium deficiency, which can lead to cavities and affects growth,” the school principal, Rita Darrechon, told Tierramérica.The privately run public school, located 500 km southwest of the capital, serves children between the ages of six and 14, and a few older children who have repeated grades.The children live in rural or semi-urban areas in the eastern province of Buenos Aires. But most of them were raised without any farming culture or knowledge about or tools for agriculture.“In places that were historically farming areas, kids do not know what to do with the land,” the general coordinator of the Huerta Niño Foundation, Bárbara Kuss, told Tierramérica. “They don’t know that if they’re hungry, the seeds in their hand can feed them.”The aim of the non-profit institution founded in 1999 by businessman Federico Lobert is to help reduce hunger among students in rural schools.The initiative first began to take shape when Lobert, during a trip as a young man, heard a rural schoolteacher say “the kids couldn’t study because they hadn’t eaten anything except orange tree leaves to calm their stomachaches.”He described this as a “sad paradox” in a country “that produces so much food for millions of people around the world.”The gardens benefit 20,000 children in 270 rural schools in low-income areas, like La Divina Pastora. The vegetables and fruit they grow are eaten by the students in the school lunchroom.“It seems like a really good opportunity to promote, together, a healthy diet, using natural resources that are within their reach,” said Darrechon.According to the National Survey on Nutrition and Health, 35 percent of children in Argentina live in households with “unmet basic needs”. Of that proportion, only 53 percent receive food assistance from different social programmes.The regions with the highest percentages of children living below the poverty line are the northeast (77 percent) and the northwest (75.7 percent).Children with serious malnutrition are more vulnerable to falling ill, and they suffer from stunted growth, with lifelong consequences, Kuss said.Huerta Niño seeks to address these nutritional deficiencies, under the slogan “it’s not about giving people food, but about teaching them to produce their own.”The foundation’s involvement in each school lasts approximately a year, but the impact, Kuss said, “lasts a lifetime.”The first step is putting up a fence around a half-hectare plot of land.“We teach them why they have to keep the fence in good repair, why it can be bad for our health if dogs or other animals get into the garden; they are taught that manure is a fertiliser but that dog feces aren’t,” she added.Meetings are held with the students, parents and teachers to determine what is needed, depending on the climate, the quality of the soil, and the access to water.The next step is to prepare the soil, and the students are taught how to plant and harvest, and they learn the complete cycle in both planting seasons – autumn-winter and spring-summer.“We explain what to do step by step, because it’s really nice when the tomatoes turn red and the lettuce sprouts, but what do you do later with the lettuce? Do you just pick the leaves? Or do you pull it up by the roots? Do you plant again or do you wait till the next season?” Kuss said.Huerta Niño has backing from the Education Ministry and receives technical support and seeds from Pro Huerta, an agroecological community programme run by the government’s National Agricultural Technology Institute.With donations from individuals, companies and organisations, it spends some 4,500 dollars on each school garden, providing tools adapted to children, agricultural supplies and inputs, and special expenses for windmills or specific irrigation systems.According to Kuss, community participation is essential for the project to be sustainable.“A garden needs attention. If you don’t control the pests, you don’t irrigate, you don’t weed, you don’t rotate the crops, it dies,” she said.“That would be a failure for the kids, which is the last thing they need, with the problems they already have,” she stressed.The initiative promotes agroecological practices that use organic fertilisers and pesticides. For example, aromatic flowers are planted to ward off insects.Chemical pesticides are not used, although surrounding fields are often sprayed.“We teach them that the tomato that grows in their garden might not be as big as the ones in the supermarket, but it will be red and tasty,” Kuss said.The garden forms part of the educational curriculum: from math (measuring the borders of the garden) to natural sciences and reading and writing (using instructional booklets).“It’s like an open-air laboratory. Learning through hands-on experience is much easier than learning by reading a book,” Darrechon said.Sometimes the students make their own gardens in their homes or communities, and some former students of La Divina Pastora have gone on to secondary school studies in agriculture.The initiative also teaches healthy eating habits – but not without running into certain difficulties.“The radishes were so nice and red, but when the kids bit into them they would throw them away,” Darrechon said. “We had to disguise them or process other vegetables like chard in tarts or pies, mixed with ground beef to hide the taste, because they come from a culture of junk food or meat and potatoes.”In schools in poor outlying semi-urban areas in Buenos Aires, some gardens have also helped combat violence and school dropout “by keeping kids in school with something interesting that keeps them off the streets,” said Kuss.The representative in Argentina of the United Nations Food and Agriculture Organisation (FAO), Valdir Welte, told Tierramérica that school gardens are playing an “extremely important” role in improving diets and eating habits and fighting hunger.He also said they are “an educational tool that strengthens the learning process and foments values such as solidarity, cooperation and collective work.”“Children don’t only need to eat well; they must also learn about a healthy diet and learn how to grow their own food in case they need to,” said Welte.He also said gardens “can be educational and training spaces for the entire community, where heads of households acquire the necessary skills for producing their own foods.”Kuss said these benefits from the gardens are as tangible as the fruit and vegetables produced.“We don’t only give them food,” she said. “We’re offering them different values they can touch with their hands. Helping them, and telling them: you can do it.”This story was originally published by Latin American newspapers that are part of the Tierramérica network.May 26, 2015Statement of Food & Water Watch Executive Director Wenonah HauterWashington, D.C.—“As has become a common practice by the Obama administration, the USDA’s Animal and Plant Health Inspection Service (APHIS) transmitted to the White House Office of Management and Budget over a federal holiday weekend two major final rules that would open up imports of fresh beef products from Brazil and Argentina, hoping that no one was paying attention.These final rules were sent to OMB on Friday, May 22 but not posted on its website until Saturday, May 23.“What is significant about these two final rules is that they would relax a longstanding ban by APHIS from allowing fresh beef imports from countries that have a history of foot and mouth disease (FMD) in their animal herds. The U.S. has not had a case of FMD in cattle since 1929. Food & Water Watch and number of livestock groups have already expressed their opposition to this relaxation of the FMD policy.“In addition, Brazil and Argentina have a checkered food safety history with the meat products that they are already eligible to export to the U.S. USDA has been forced to suspend imports from these two countries over the past decade for food safety violations and for violating inspection standards.“These new final rules come on the heels of the World Trade Organization ruling that found USDA‘s country of origin labeling regulations to be impediments to free trade. Consequently, consumers may not know at the meat counter whether the products they buy come from countries that have had a history of animal health and, or food safety problems.“Food & Water Watch will continue to express its opposition to these final rules at OMB.”By Erol Ersoy and Charles NewberyMay 27, 2015– Exporters losing $25,000 per boat for every day of delay, according to one estimateBUENOS AIRES, Argentina – More than 80 boats are delayed on the Parana River in Argentina, snarling agriculture exports Tuesday as vegetable oil workers strike for higher wages and navigation channels run shallow.The Federation of Oilseed Workers is demanding 36 percent increases in salaries this year to keep ahead of inflation running at 30 percent annual. They have been on strike since May 4.The government, however, wants to limit the hikes, warning that increases of more than 25 percent could stir faster inflation, slowing the economy even further.“The pressure is very heavy for the increase to not surpass 27 percent,” Adrian Davalos, secretary general of the union, told Radio 2 in Rosario, a port city on the Parana River.Inflation has come down from 40 percent in 2014, in part because a contracting economy is cooling consumer demand. But economists say it will probably continue to run at 30 percent for the rest of the year.The boats unable to load are in ports in Rosario, located up river from Buenos Aires and where much of the country’s soybean and products are shipped for export. Argentina is a major exporter of corn, soy and related products like soy oil.The delayed vessels are due to ship soybean and flour as well as fertilizers, wheat and iron to Algeria, Brazil, China, Vietnam and elsewhere, according to the Chamber of Port and Maritime Activities.The chamber said 33 boats have been affected by the strike, while another 54 have been detained because of shallow waters in navigation channels on the river that has led to a series of groundings in the past few weeks, it said.Exporters are losing about $25,000 per boat for every day of delay, according to the chamber.This is the latest strike to hit Argentina this year, with bankers conducting a two-day strike beginning Tuesday.On June 9, a faction of the General Labor Confederation, the biggest union umbrella group in the country, will join transport workers in a national strike.