Fausta's Blog

The big news of the week was yesterday’s Peruvian election of Ollanta Humala as their next president:

Financial markets, which have been riding a roller coaster during the long campaign, are sure to take a win by Mr. Humala badly, analysts said. Investors viewed Ms. Fujimori as the candidate who would maintain the policies of openness toward foreign investment and trade, which helped Peru grow by 9% last year. Mr. Humala, who has made sharply contradictory statements on economic policy, would face pressure to immediately send signals to the market by revealing who would serve in key positions, such as Prime Minister and Economy Minister.

BRAZIL
Lagarde, on Visit to Brazil, Vows Speedy IMF Reform

Dilma’s first big test
The political wounding of Antonio Palocci, the president’s right-hand man, comes at an awkward time, when the battle to cool the economy has only just begun

CHILE
Video: Michelle Bachelet on UN Women

Volcano erupts in Chile

COLOMBIA
Colombia kills FARC commander
Colombian authorities said they killed the top-ranking security chief of the rebel group FARC, Alirio Rojas Bocanegra, known as “El Abuelo,” member of the FARC Central Command.

CUBA
Fábrica de españoles

GUATEMALA
Ethics and politics get divorced

ECUADOR
Congressman McGovern visits Ecuador

SUMMARY: Congressman James McGovern traveled in Ecuador from November 13 to 18, to visit sites at issue in the Chevron-Texaco oil pollution case, and Ecuadorian border communities affected by refugees and other aspects of the violence in Colombia. Congressman McGovern met with Government of Ecuador (GOE) Ministers and President Correa, and while taking no position on the unresolved Chevron-Texaco suit, expressed concern about the humanitarian, health and environmental impacts of oil contamination on local affected communities and the humanitarian situation on the border, and pledged to draw greater attention to the plight of refugees. Foreign Minister Salvador and Vice Defense Minister Miguel Carvajal asked McGovern for the U.S. Congress to investigate the March 1 Colombian attack against a FARC camp in Angostura, along the northern border of Ecuador, which McGovern did not agree to.

HAITI
New Study Questions Quake Toll In Haiti

MEXICO
Mexico City Retailers Pause

Retailers have put expansion plans on hold in the Mexican capital after the megacity’s government enacted a virtual three-year moratorium on openings of grocers, convenience stores and hypermarkets in an effort to shield traditional markets and small family-run bodegas from corporate competition.

Soul-searching amid the debris
Mexican individualism and violence

PARAGUAY
Police in Paraguay Seize 2.1 Tonnes of Cocaine Adulterate

PERU
Today’s video: Toss up

PUERTO RICO
A pun gone wrong: Coors Light “Emboricuate” Ads Brews Outrage Among Puerto Ricans

VENEZUELA
Venezuela: The Brazil connection

Why I am not blogging much lately: the “gimme!” culture of Venezuela. Venezuela’s not alone.

The Perverse Gasoline Subsidy in Petrostates

The week’s posts,
Venezuela: Welcome to Club Hugo
Ollanta Humala’s shell game
The short answer is, No

At Real Clear World,
Bolivia Invites, Then Disinvites, Accused Iranian Terrorist

While we’re wallowing in disastrous economic policy, Chile is flourishing. Why is that?

How Chile Got Rich

Wealth: Chile is expected to win entry to OECD’s club of developed countries by Dec. 15 — a great affirmation for a once-poor nation that pulled itself up by trusting markets. One thing that stands out here is free trade.

At a summit of Latin American countries last week in Portugal, Chilean President Michelle Bachelet suddenly became the center of attention — and rightly so. She announced that her country was expected to win membership in the Organization of Economic Cooperation and Development, an exclusive club of the richest and most economically credible nations.

Chile is the first country in South America to win the honor, and in a symbolic way its OECD membership card seals its exit from the ranks of the Third World to the First.

For the rest of us, it’s a stunning example of how embracing free markets and free trade brings prosperity.

How?

Embracing markets has made it one of the most open economies in the world, ranking third on Cato’s index, just behind Hong Kong and Singapore. Per capita GDP has soared to $15,000.

Besides its embrace of free trade, other reforms — including pension privatization, tax cuts, respect for property rights and cutting of red tape helped the country grow not only richer but more democratic, says Cato Institute trade expert Daniel Griswold.

But the main thing, Griswold says, is that the country didn’t shift course. “Chile’s economy is set apart from its neighbors, because they have pursued market policies consistently over a long period,” he said. “Free trade has been a central part of Chile’s success.”

Chile has signed no fewer than 20 trade pacts with 56 countries, giving its 19 million citizens access to more than 3 billion customers worldwide. When no pact was in force, Griswold notes, Chile unilaterally dropped tariffs. This paid off handsomely.

You’ve heard of flat taxes? Chile has a flat tariff — only 5% on any item not exempted by a free-trade treaty, Griswold points out. But almost nobody has signed off on free-trade treaties like Chile.

Go read it all.

Estonia, Israel, Russia and Slovenia are also in the process of applying to the OECD.

Congratulations to Chile on this outstanding achievement. May it continue in this track.

The DVDs with the trouser-in-socks moment; the Daniel Hannan speech at the EU Parliament; Lula’s spicy “white people with blue eyes” comment; all in Gordon Brown’s tour in preparation to the upcoming G20.

And now this (h/t the Baron):
Chile leader to Brown – we saved in the good times

Gordon Brown was embarrassed for the second time in as many days on his tour of South America today as his Chilean host explained how the country was able to protect is economy because it had saved cash in case of a downturn.

In words that could have been scripted by David Cameron, Chile’s president, Michelle Bachelet, said the country was in a position to fund further tax cuts if necessary.

“I would say that because of the decisions we took during the good times, we were able to save some money for the bad times. And I would say that today that policy is producing results,” he said.

President Bachelet was speaking at a joint press conference with Mr Brown on the last leg of his six-day world tour ahead of next week’s G20 summit in London which started with a call for the “biggest fiscal stimulus the world has ever seen.”

But the Prime Minister had to signal a retreat from a further Budget giveaway in the UK after the Bank of England voiced concern over Britain’s record debt.

Brown’s heading to Argentina next. At least Brown and Fernandez agreed ahead of time that sovereignty over the Falklands Islands will not be up for discussion when Gordon Brown holds talks with Argentine President Cristina Fernandez. Let’s hope Fernandez sticks to that agreement.

UPDATE
Commenter Sheila adds a YouTube of Brown being castigated by yet another Brit,

UDPATE
Brown snubbed over tax
Germans wreck ‘global new deal’

“Who knows what evil lurks in the hearts of men? The Shadow knows!“

In today’s Granma:

I wonder what Brian would say.

Related post and podcast.

Share on Facebook

In today’s podcast at 11AM Eastern:

Chilean President goes to Cuba and gets her picture taken with Fidel Castro, who’s still wearing Adidas.

“He is in very good condition,” Bachelet told reporters in Havana, saying Castro was “very agile” and “active.”

Let’s hope the Chilean economy remains more “agile and active” than Fidel.

UPDATE
Snapped Shot is wondering if those photos are fake.

Chat’s open at 10:45AM and the podcast’s archived for your listening convenience.

Related links:
Chile’s Bachelet Visits Cuba
Chilean President criticizes anti-Cuban economic embargo
At Granma, the offical organ of the Cuban Communist party, Chilean President in Cuba

Castro, who the US-born Catholic priest anti-Semite and former Sandinista UN General Assembly President Miguel D’Escoto calls a a saint, has some odd theories about Rahm Emanuel

Share on Facebook