Regional Pulse: 30 July 2024
Southern Pulse’s weekly review of need-to-know events curated for people who work in Latin America.
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KEY DEVELOPMENTS
ARGENTINA
Milei boosts National Intelligence System budget by USD100 million via decree
Peronist leaders convene to forge new economic plan
Milei's approval rating declines in Buenos Aires’ poorer areas
BRAZIL
Lula considers joining China’s Belt and Road Initiative
Bill would grant more power to Brazil’s municipal guard
CHILE
Right-wing party president resigns amid family controversy
Chilean lawmakers visit China to discuss bilateral relations, AI, and electromobility
Nine arrested in La Araucanía region during massive police raid
COLOMBIA
National Intelligence Agency director resigns amid corruption case
Army officials detain convoy transporting Estado Mayor Central members
ECUADOR
Central Bank forecasts an economic rebound, but local analysts remain skeptical
Ecuador’s highest court sentences drug boss’ lover for bribery
IDB approves USD600 million loan for electricity projects
MEXICO
US apprehends Sinaloa Cartel leaders ‘Mayo’ Zambada and El Chapo’s son
Hundreds flee to Guatemala to escape organized crime violence
Elon Musk halts construction of Nuevo León Tesla plant
PERU
NGO alleges that new congressional president has illegal mining ties
Protesters descend on Lima during Boluarte’s Independence Day address
VENEZUELA
Opposition leaders claim fraud as Maduro wins third presidential election
KEY DEVELOPMENTS IN FULL
ARGENTINA
Milei boosts National Intelligence System budget by USD100 million via decree
On 15 July 2024, the Argentine government significantly increased the National Intelligence System budget by USD100 million via decree. This financial boost aims to reorganize and support the operations of various intelligence agencies, including the Argentine Intelligence Service and the Cybersecurity Agency. This funding comes after the Milei administration dissolved the previous Federal Intelligence Agency, which was previously criticized for allegedly carrying out unjustified political espionage activities and other abuses. The government argues that restructuring the intelligence operations aims to restore democratic integrity, although the specific allocation of funds remains undisclosed. Opposition members criticize the decree, alleging it is politically motivated and provides financial funding for social media influencers to attack opposition voices. Opposition deputies led by former senator Miguel Pichetto intend to overturn the decree.
Peronist leaders convene to forge new economic plan
On 25 July 2024, former commerce secretary Guillermo Moreno hosted a meeting between high-profile Peronist economists in Buenos Aires. This meeting aimed to shape new economic policy guidelines for the Peronists, the largest opposition party. Participants included appointees from diverse Peronist sectors associated with Buenos Aires Province Governor Axel Kicillof, lawmaker Máximo Kirchner, and former finance minister Sergio Massa. They emphasized efforts to unify a fragmented opposition movement under a comprehensive economic strategy. The discussions focused on a reindustrialization plan expected to form the foundation of the Peronists’ new economic agenda. Moreno hopes to be the Peronist candidate in the 2025 legislative elections. He believes the party should return to embracing the economic philosophy of Juan Domingo Perón, who served as Argentina’s president for three terms between the 1940s and the 1970s.
Milei's approval rating declines in Buenos Aires’ poorer areas
On 25 July 2024, polling firm CB Consultora Opinión Pública released a survey detailing a notable decrease in President Javier Milei's approval ratings throughout the Greater Buenos Aires area, particularly in its poorer and most populated districts. The survey encompassed feedback from 24 municipalities, revealing that Milei’s popularity had decreased in 18 of these areas. Milei maintains relatively high approval ratings in economically affluent northern municipalities outside the capital such as San Isidro, where he has a 52.5% positive rating. Conversely, Milei's approval ratings significantly dropped in working-class southern districts traditionally more aligned with Peronism. La Matanza municipality, the largest district countrywide with 1.8 million residents, reported a 63.4% disapproval rating for Milei. Local analyst Nicolás Baccaro noted that the ongoing recession might be hurting Milei’s support in the poorest districts.
BRAZIL
Lula considers joining China’s Belt and Road Initiative
On 25 July 2024, Chinese Foreign Ministry spokesperson Mao Ning stated that China is seeking to align its Belt and Road Initiative (BRI) with Brazil’s reindustrialization plans. On 22 July 2024, President Luiz Inácio Lula da Silva stated he is considering joining the BRI to deepen the countries’ bilateral strategic partnership to foster commodities exports and cooperation in technology and science. Despite China being Brazil’s biggest commercial partner since 2009, Brazil is among the few Latin American countries that have not agreed to join China’s BRI. Established in 2013, China’s global infrastructure development strategy has participation from 150 countries. BRI projects have garnered USD1 trillion in Chinese investments worldwide, mostly for transportation infrastructure.
Bill would grant more power to Brazil’s municipal guard
On 22 July 2024, news outlet Folha reported that a congressional caucus is sponsoring a bill that would assign more power to Brazil’s municipal guard forces across the country. The bill has support from 325 of the lower chamber’s 513 representatives. The municipal guard was originally formed to protect municipal property. But through the years, its members have gained powers once reserved for military police, such as permission to carry firearms. The bill, currently under analysis by the Chamber of Deputies, would change the force’s official name to Municipal Police and allow its members to collaborate with other police forces and receive federal funding. Proponents of the bill on both the left and right argue that it is necessary to fight crime. In contrast, public safety expert Luís Flávio Sapori argues that the amendment will stray the force away from its purpose of providing preventative policing.
CHILE
Right-wing party president resigns amid family controversy
On 23 July 2024, the right-wing Unión Demócrata Independiente (UDI) President Javier Macaya resigned following intense political scrutiny after defending his father Eduardo Macaya Zentilli, who was sentenced to six years in prison for sexually abusing minors. His resignation ended his three-year tenure, leaving the party in turmoil just days before it had to submit its candidate list for the October 2024 municipal election.
Chilean lawmakers visit China to discuss bilateral relations, AI, and electromobility
On 23 July 2024, media outlet El Siglo reported that a delegation from Chile's Chamber of Deputies led by speaker Karol Cariola concluded a three-day official visit to China to strengthen bilateral relations and discuss key topics such as lithium, artificial intelligence, and electromobility. Diario Financiero reported that Chinese officials wanted Tianqi, a Chinese multinational and shareholder in Chilean mining and petrochemical company SQM, to be allowed to participate in SQM’s lithium projects. SQM has reached a deal with the copper giant Codelco to mine lithium as part of the government-sponsored National Lithium Strategy. Chilean lawmakers also visited Huawei’s headquarters in Shenzhen to learn about AI solutions for city governments.
Nine arrested in La Araucanía region during massive police raid
On 26 July 2024, BioBio reported that nine foreign nationals were arrested in a large-scale operation by Chile's Investigative Police (PDI) force. Authorities also seized ammunition and drugs during the raid in the municipality of Angol, located in the La Araucanía region. The anti-drug operation involved more than 300 detectives from several regions and targeted 24 residences. The detainees included eight Colombians and one Bolivian, with seven having outstanding judicial warrants and two caught possessing drugs. The raid was part of a long-term investigation coordinated by Angol’s Anti-Narcotics and Organized Crime Brigade and the local prosecutor’s office.
COLOMBIA
National Intelligence Agency director resigns amid corruption case
On 26 July 2024, President Gustavo Petro accepted Carlos Ramón González’s resignation as director of the National Intelligence Agency (DNI) following his alleged involvement in the National Unit for Disaster Risk Management (UNGRD) corruption scandal. Investigators suspect that González used his government position to divert UNGRD contracts to corrupt contractors. UNGRD is a government agency whose projects focus on mitigating the effects of natural disasters. González previously led DAPRE, an administrative entity that oversees government programs and manages the president’s relationships with Congress and the judicial branch. El Pais reported that González was one of Petro’s closest cabinet members. González’s resignation has been followed by a chain of allegations made by former UNGRD director Olmedo López, who is currently cooperating with the Attorney General’s Office.
Army officials detain convoy transporting Estado Mayor Central members
On 23 July 2024, Colombian Army officials detained a convoy of seven SUV trucks transporting 34 members of the FARC dissident group Estado Mayor Central (EMC) with arrest warrants in the department of Antioquia. The EMC convoy traveled in official law enforcement vehicles for more than 600 kilometers from Norte de Santander Department until stopping at an Army roadblock. The guerrilla members, including three leaders and a minor, argued that they should be allowed to pass because EMC is engaged in peace talks with the government. They were finally detained after nine hours. On 24 July 2024, the Attorney General’s Office released Erlinson Echavarría Escobar (aka “Ramiro”), an EMC leader detained the previous day.
ECUADOR
Central Bank forecasts an economic rebound, but local analysts remain skeptical
On 22 July 2024, the central bank released a report forecasting a rebound in the overall economic activity (GDP) for Q3 2024. Central Bank Manager Guillermo Avellán said that after two consecutive quarters of recession, the economy now has push factors such as loans from multilateral banks, rising public investment, growing exports, and governments decreasing vendor payment delays. However, Primicias reported that skeptical analysts are not fully convinced of the renowned vigor of Ecuador’s economy, pointing to sluggish retail sales and household consumption. Economist Diego Borja told El País that President Daniel Noboa’s policies of cutting government spending and raising VAT tax will further hurt economic growth.
Ecuador’s highest court sentences drug boss’ lover for bribery
On 24 July 2024, Ecuador’s highest court sentenced Mayra Salazar to 15 months in prison on organized crime charges. Salazar, the former lover of drug boss Leandro Norero, signed a leniency clause with the Attorney General’s Office that reduced her prison time from 10 years. Salazar led public relations for the Guayas Provincial Court. She was tried for using her position to develop Norero’s illicit commercial interests in Guayas, Ecuador’s richest province. That included bribing local judges not to prosecute Norero and his family members. Norero was killed in a prison riot in 2022. Salazar is one of the 49 people prosecuted in the Metástasis case unveiled in December 2023, which revealed corruption between elected officials, judges, state prosecutors, police officers, and drug traffickers. Norero was a leading figure in Ecuador’s criminal underworld, financially backing three of the country’s largest gangs — Los Lobos, Los Tiguerones, and Los Chone Killers.
IDB approves USD600 million loan for electricity projects
On 24 July 2024, the Inter-American Development Bank (IDB) approved a USD600 million loan to Ecuador for electricity transition and housing projects. The projects aim to improve electricity access for 80,000 houses countrywide, and will also focus on helping shrimp companies transition from fossil fuels to renewable energies, Primicias reported. Loans from multilateral banks became Ecuador’s main source of government financing since President Daniel Noboa took office in December 2023. Noboa previously agreed to a USD4 billion loan disbursement from the International Monetary Fund (IMF) on 31 May 2024 and to receive USD483 million from the Development Bank of Latin America and the Caribbean (CAF) on 18 July 2024.
MEXICO
US apprehends Sinaloa Cartel leaders ‘Mayo’ Zambada and El Chapo’s son
On 28 July 2024, US security authorities apprehended Sinaloa Cartel leaders Ismael Mario Zambada (aka “Mayo” Zambada) and Joaquín Guzmán López (aka “El Güero”), the latter of whom is the son of drug lord Joaquín Guzmán Loera (aka “El Chapo”). According to the US Department of Justice (DOJ), both criminals were arrested at an airport in El Paso, Texas for alleged drug trafficking. Zambada co-founded the Sinaloa Cartel with El Chapo in the 1980s, but El Chapo’s 2016 arrest made Zambada the highest-ranking leader of the criminal organization. Public Security Secretary Rosa Icela Rodríguez announced that Zambada and Guzmán voluntarily surrendered to US authorities and said the Mexican government was not involved in the apprehension. President Andrés Manuel López Obrador asked the US government to share an official report about the case to resolve “all the loose ends,” but did not say which specific information he sought. Unusually, no reports of blockades or armed mobilizations have emerged since Zambada’s apprehension. Security analysts argue the incident could generate violence between members seeking the cartel’s leadership, particularly in the states of Sinaloa, Durango, and Baja California.
Hundreds flee to Guatemala to escape organized crime violence
On 24 July 2024, Guatemalan president Bernardo Arévalo said that violence linked to criminal organizations prompted nearly 600 people to flee from southern Chiapas state to Guatemala by crossing the Usumacinta River. Chiapas officials said they are not aware of people being displaced into Guatemalan territory. Forced displacement has been ongoing in Chiapas since 2021, when a drug lord associated with the Sinaloa Cartel was assassinated by rival organization Jalisco New Generation Cartel (CJNG). President Andrés Manuel López Obrador thanked Guatemalan authorities for the support but denied that this situation signifies a failure of his administration's security strategy.
Elon Musk halts construction of Nuevo León Tesla plant
On 23 July 2024, Tesla CEO Elon Musk announced during a conference call with analysts and media that he would halt construction of a planned Tesla vehicle assembly plant in northern Nuevo León state. Musk said he will wait for the outcome of the US elections in November to decide whether to continue construction. He explained that if Republican candidate Donald Trump gets elected, new tariffs on cars manufactured in Mexico would likely follow suit and be detrimental to the plant’s production. Tesla plans to begin construction on the USD5 billion facility in 2026. Nuevo León Governor Samuel García said his administration has not been officially informed of any changes to the plant’s construction schedule.
PERU
NGO alleges that new congressional president has illegal mining ties
On 26 July 2024, Eduardo Salhuana was elected as congressional president for the 2024-2025 period, with 95 of 120 lawmakers in favor of his appointment. Salhuana is an ally of President Dina Boluarte and a leading figure in the center-right party Alianza Para el Progreso (APP). Salhuana allegedly has ties to illegal mining networks in the Madre de Dios region, RPP reported. NGO Transparencia Perú spoke out against Salhuana’s appointment, claiming that the congressman has promoted legislation favoring illegal mining.
Protesters descend on Lima during Boluarte’s Independence Day address
On 28 July 2024, President Dina Boluarte was met by protesters in Lima as she gave a speech commemorating Peru's Independence Day. Family members of protesters killed in 2022 and 2023 called for countrywide demonstrations during the weekend of 27-29 July 2024, when Peru celebrated its 203rd anniversary of independence from Spain. Peruvian National Police (PNP) officers clashed with protesters in downtown Lima during Boluarte's speech.
VENEZUELA
Opposition leaders claim fraud as Maduro wins third presidential election
On 28 July 2024, Venezuelans took to the polls in large numbers to vote in a widely publicized presidential election. In the early hours of 29 July 2024, the National Electoral Council (CNE), controlled by the current President Nicolás Maduro, announced that Maduro had won the election with 51% of the vote to opposition candidate Edmundo González Urrutia’s 44%. The opposition coalition responded immediately after, indicating that votes were still being tabulated. They said that based on the tally sheets they had received, González Urrutia was the clear winner. The CNE confirmed Maduro as the winner but refused to share the official tally, and protests broke out organically. On the evening of 29 July 2024, opposition leaders María Corina Machado and González Urrutia held a press conference in Caracas to demonstrate what they say is clear evidence that Maduro committed fraud and stole the election. The opposition politicians unveiled a website showing the results of 73.2% of polling stations countrywide, which they tabulated via a massive network of electoral witnesses. The official tally sheets held by these witnesses showed that the opposition had won by more than 4 million votes. Machado (who had been banned from running) and González Urrutia called for peaceful demonstrations on 30 July 2024, asking Venezuelan citizens and the international community to demand that the CNE release transparent results. Organic protests have turned violent in some cases, and there are at least four citizens reported dead at the time of publication. Internationally, Cuba, Honduras, Nicaragua, China, and Russia quickly congratulated Maduro on his reelection. Meanwhile, more than 10 other countries including Argentina, Chile, and Italy did not recognize the result. The US, Brazil, Colombia, and Mexico have called on the CNE to release detailed polling results. The situation remains ongoing.
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