Latin American Program in the News: Latin America 2013: Political Outlook

BY JOACHIM BAMRUD, LATINVEX

Jan 03, 2013

Although Latin America will only hold four presidential elections this year, politics play a big role in the region this year.

“The electoral cycle will drive some of the region’s major political stories,” says Cynthia J. Arnson, Director of the Latin American Program at the Woodrow Wilson International Center for Scholars.

From February to December, voters in Ecuador, Paraguay, Honduras and Chile will elect their next president. “With presidential elections coming up in three politically troubled countries - Ecuador, Paraguay, and Honduras - the outlook is complicated,” says Michael Shifter, president of the Inter-American Dialogue.

Meanwhile, major political issues will be playing a central role in Argentina, Bolivia, Colombia, Mexico and Venezuela.

The deteriorated health of Venezuelan president Hugo Chavez – and resulting question marks about what will happen if and when he dies -- creates uncertainty not only in his country but also throughout Latin America, especially countries like Cuba and Nicaragua that depend heavily on Venezuelan aid.

Mexico’s new president Enrique Peña Nieto – who assumed office on December 1 last year – will see his first year in office amidst high expectations of reforms and reduced drug violence. “The good news story in 2013 may be Mexico, provided that Peña Nieto and his team are able to show that the PRI has modernized and is in sync with an increasingly open and democratic Mexican society,” Shifter says.

Growing unrest in Argentina is likely to further weaken President Cristina Fernandez as the country prepares for congressional elections in October.

And Colombia’s government continues with peace talks with guerrilla group FARC. “The development with the greatest potential to affect politics in the region may well take place in Colombia, tied to the success or failure of the peace process between the Santos government and the FARC guerrillas,” Arnson says.

VENEZUELA: THE CHAVEZ FACTOR

January 2013 was supposed to mark the start of a new six-year term for President Hugo Chavez, who was re-elected in October. Instead, his health is now leading to speculation about the political future of not only Venezuela, but also Chavez-instigated political and economic alliances throughout Latin America.

“There appears to be little doubt that he is extremely ill,” Shifter says. “His poor health was evident in the recent presidential campaign and already hampered his ability to maintain his customary frenetic political activity in the region.”

Chavez and Venezuelan officials have refused to provide details about his cancer, which was announced in June 2011. Last month, Chavez returned to Cuba for his fourth operation related to the illness and there is growing speculation that he may die within months and even before the scheduled January 10 inauguration of his new term.

Even if Chavez recovers and is able to carry out his functions as president, deepening problems in Venezuela - particularly the economy and crime - will require him and his government to focus more on the national agenda, he points out.

“He will have fewer resources at his disposal to assist allied countries and Petrocaribe members,” Shifter says. “Chavez's political support in the region, which was never as strong as was commonly assumed, will weaken, as each country pursues its own course.”

If Chavez dies before his new term ends, new elections will have to be held. “The holding of constitutionally-mandated elections should he die in the first two years of his new term offers a new set of possibilities to the opposition,” says Arnson.

Vice president Nicolas Maduro was singled out by Chavez as his potential successor and would likely face off in elections with opposition leader Henrique Capriles, who lost the October elections to Chavez.

In any case, uncertainty has been heightened as the Chavez drama continues,” Shifter says.

ARGENTINA: WEAKER PRESIDENT

President Fernandez, who won re-election in October 2011, is now facing a wave of protests over her policies.

“Cristina Fernandez de Kirchner is on shaky ground,” says Riordan Roett, Professor and Director, Latin American Studies Program, Western Hemisphere Studies, SAIS-Johns Hopkins University.

In November a large crowd – up to 500,000 according to one estimate – took to the streets of Buenos Aires to protest rising insecurity and the government’s currency controls and false inflation data.

“Street demonstrations in Buenos Aires are never a good sign,” Roett says. “Middle class opposition is growing. Inflation, crime [and] controls on currency movements are all unpopular.”

Also in November, the top union CGT organized a strike against the government that paralyzed much of Buenos Aires.

And in December, a wave of looting took place in several cities, bringing recollections of the social unrest that plagued Argentina in 2000 and 2001.

Meanwhile, Fernandez has suffered from several legal setbacks related to a new law aimed at breaking up the Clarin media group, which has been a leading critic of her policies.

On December 6, 2012, the constitutional branch of the Supreme Court granted Clarin a reprieve over an anti-monopoly law that would have forced the media group to divest assets by December 7. “The ruling …shows that the judiciary still enjoys independence despite the government's efforts to exert control over the top judges,” Carlos Caicedo, the head of the Latin America division at UK-based Exclusive Analysis, said in a commentary. “This is an indicator of Cristina Fernandez' gradual loss of political control.”

On December 27, the government suffered another setback when the Supreme Court rejected a petition to get involved in the case instead of a lower court.

“Confrontation is likely to build in coming months,” Arnson predicts. “The country’s economic situation will continue to worsen as a result of high inflation, shortages of foreign capital, and falling energy production.”

Part of the problem is also Fernandez’ intransigence, experts say.

“She is not likely to adopt a set of policies that will put the country on a more productive and sustainable economic path and overcome the sharp political polarization,” Shifter says. “To be sure, she has been underestimated before and could get lucky - and the opposition remains highly fragmented and weak - but there are significant risks of unrest and tough times ahead.”

BOLIVIA

Bolivia is also facing a wave of social and political unrest, but President Evo Morales seems firmly in control, experts say.

“Although president Morales will face mounting pressures and challenges from his own constituency, he is still in a relatively strong political position, thanks chiefly to the economy,” Shifter says. “The Morales government will probably be able to manage and successfully contain the continued social and political unrest.”

Arnson points to an October 2012 Ipsos-Apoyo poll that showed Morales’ approval ratings at 59 percent, an improvement of 11 percent over the prior six-month period. At the same time, his disapproval ratings fell by an even larger 13 percent, from 46 to 33 percent. The numbers continue to show important disparities by level of income and between rural and urban areas, but overall, his position—and that of Vice President Alvaro Garcia Linera—has strengthened, she points out.

CHILE

Chile is scheduled to hold presidential and congressional elections on November 17, with a second round held on December 15 if no candidate wins more than 50 percent of the vote.

Polls show that former president Michelle Bachelet from the left-of-center Concertacion alliance is the favorite, although she has not yet officially announced her intention to run.

The right-of center government Coalicion por el Cambio coalition plans to hold its primary in June to choose between former mining and public works minister Laurence Golborne or former defense minister Andres Allamand as its presidential candidate.

“The Concertacion is favored to stage a comeback in Chile, especially if former president Michelle Bachelet re-enters the race,” Arnson says.

Compared to the rest of Latin America, the differences between the major Chilean parties are relatively small, with broad consensus on market-oriented economic policies.

COLOMBIA

In November, the government of President Juan Manuel Santos started formal negotiations with guerrilla group FARC aimed at reaching a peace agreement.

FARC has political roots, but is now considered more of a criminal organization. Experts say it is the world’s largest drug cartel. Officials also say it is experts say it is but is now the main group behind kidnappings in Colombia. It now has less than 8,000 members compared to 20,000 in 2000, according to government data.

Santos says he expects to have a peace agreement in place by November this year, although polls show many Colombians are skeptical about success.

“Santos' timeframe for a November 2013 resolution to the conflict remains highly optimistic, given that a fundamental difference still exists between the two sides over the political model that the country should follow,” IHS Global Insight analyst Robert Munks said in a recent commentary.

The next presidential elections are scheduled to take place in May next year and the talks or any eventual agreement’s success or failure will likely be a major issue. Santos’ predecessor Alvaro Uribe has criticized the talks for legitimizing a terrorist group. Polls show that a 75 percent of Colombians support the talks but that only 45 percent actually think they will be successful.

The talks come as insecurity has grown in Colombia. Meanwhile, social conflicts and tensions associated with extractive industries will pose continuing challenges for the Santos government, Shifter says.

ECUADOR

Ecuador is scheduled to hold presidential and congressional elections on February 17, with a second round held on April 7 if no candidate wins more than 50 percent of the first round vote. President Rafael Correa, who has held office since January 2007, is running for a new four-year term.

“Correa is expected to handily win,” says Arnson, pointing to a Cedatos poll that gave him a 32-point lead over his strongest opponent, Guayaquil banker Guillermo Lasso.

“Ecuador is a much smaller oil producer than Venezuela, but like Chavez, Correa has used commodity income from oil to vastly expand social expenditures, including subsidies that are wildly popular with the poor,” she says.

Shifter agrees. “He benefits from a reasonably strong economy … which has resulted in ramped-up government spending on roads, schools and hospitals in recent years,” he says about Correa.

The result of a Correa victory? “We can expect continued erratic, populist leadership from a deeply insecure individual who may take the election to further deepen his commitment to more statist policies,” says Roett.

Correa has been masterful at the 'permanent campaign' and is a superb communicator, Shifter points out. “He is adept at confrontational politics that still works very well with many Ecuadoreans,” he says. “And the opposition remains weak and fragmented. If oil prices remain high and the opposition continues to be unable to modernize, unify, and get some traction, Correa will still be in a strong political position in his next term and is expected to pursue the policies - sometimes radical, sometimes not, depending on the circumstances -- that have enabled him to perpetuate power and carry out his agenda. That means even weaker constraints on his authority and notably arbitrary rule.”

HONDURAS

Honduras is scheduled to hold presidential and congressional elections on November 10. The top three contenders are Juan Orlando Hernandez from the ruling National Party, Mauricio Bermudez Villeda from the Liberal Party and Xiomara Castro from the Libre party.

“The third-party candidacy of Xiomara Castro de Zelaya, wife of ousted Honduran president Manuel Zelaya, challenges the hold of the long-dominant Liberal and National parties,” says Arnson.

Zelaya was ousted by Honduras’ military acting on behalf of congress in June 2009 but allowed to return in May 2011.

“Libre will be a major actor in the elections, but is unlikely to win the presidency,” predicts IHS Global Insight analyst Laurence Allan.

However, it is doubtful that the elections in Honduras - which is experiencing spreading chaos and crime - will do much to settle the political situation, Shifter warns.

IHS Global Insight says the situation may even worsen should Libre gain strength while espousing radical policies. “If Libre … party gains strength and adopts radical positions moving towards the presidential election in November 2013, the political tensions already bubbling could ignite significant political instability,” the consultancy said in its overview of Honduras’ political risk. “Given current security challenges it could conceivably push Honduras towards becoming a failing state.”

PARAGUAY

Paraguay is scheduled to hold presidential and congressional elections on April 21. The two top contenders are businessman Horacio Cartes from the opposition Colorado party and Efrain Alegre from the ruling PLRA party.

At stake in the election in Paraguay is more than who will govern the country the next five years. The elections in Paraguay will likely lead to an end to the country’s international isolation following the June 2012 ouster of then-president Fernando Lugo by congress.

Mercosur (the South American common market), expelled Paraguay in August and Unasur (the Union of South American nations) did so in June.

“Paraguay should be restored to full membership in Mercosur if the elections are judged to be transparent,” Roett says.

Once new elections take place, it will be difficult to invoke the democracy clauses of both organizations to justify Paraguay’s continued exclusion, says Arnson.

“The Paraguay case has not exactly been the high point for Mercosur and Unasur,” says Shifter. “The situation was more complicated than was suggested by the way it was handled by both regional groupings. True, the ouster of President Lugo lacked due process and was a setback for democracy. But his removal led to a similarly rushed decision to suspend Paraguay from both organizations. It would make sense that April's presidential elections would be sufficient to justify Paraguay's return to both Mercosur and Unasur, but it's certainly possible that this situation will still be mismanaged. Unfortunately, political criteria too often influence such decisions. It would be a pity if Paraguay continued to be punished and excluded from Mercosur, particularly if April's electoral process is deemed free and fair.”

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