AFP this morning looks at a new report from the Brazil-China Business Council demonstrating, once again, just how significant China’s economic relations with Brazil have become. The Business Council points out that China has surpassed the US as both Brazil’s largest investor and trade partner. The magnitude of those changes over the last decade is worth highlighting:
Brazilian exports to China have skyrocketed from just $1 billion in 2000 to $30.7 billion last year.
Brazilian imports from China, mostly manufactured products, have similarly risen, from $1.2 billion in 2000 to $25.5 billion in 2010, leaving Brazil with an estimated trade surplus of just over $5 billion.
Meanwhile, Chinese firms recently announced investments that total nearly $30 billion in South America’s largest economy. Approx. $8.6 billion of those investments are currently under negotiation as Brazilian President Dilma Rousseff prepares for a five-day trip to China beginning April 10.
The report notes that China’s objective in Brazil, and elsewhere, is to secure “a base for supplies of natural resources.” Nearly 90% of the $30 billion in investment, according to the Business Council, is directed toward Brazil’s energy and mining sectors. But interestingly, Brazil-China investment relations have, at least until recently, been on relatively equal terms. Until 2009, Brazil actually had more investments in China than China in Brazil, the head of trade promotion at the Brazilian Foreign Ministry tells AFP.
According to Blooomberg, that may be changing. Imports from China to Brazil have accelerated significantly of late, climbing 47 percent in the first two months of this year to $4.7 billion – almost 16 percent of all Brazil’s purchases compared with 14 percent in the same period last year. James Bacchus, a former US congressman from Florida who now acts as Brazil’s legal counsel on international trade disputes at the WTO, said those numbers have some in Brazil worried about de-industrialization, meaning re-balancing the “composition” of China-Brazil trade, along with currency issues, will likely be a high priority as Dilma prepares to visit Beijing.
For its part China recently announced that its $300 billion sovereign wealth fund is preparing to invest more in Latin America. The chairman of the China Investment Corp. supervisory board just completed a three-country tour through the region, visiting Brazil, China, and Chile at a time when the former, Brazil, has moved to limit the amount of land foreigners can own in the country. That measure has been widely interpreted as a response to China’s agricultural land grabs which have sparked new concerns in Brazil about food security. In an interview with Financial Times, Brazil’s agriculture minister Wagner Rossi said the issue was to begin “distinguishing properly” between “speculators and sovereign funds,” on the one hand and “foreign investors who come with good project” on the other.
Adding to a changing world economy, news this week that Brazil may follow China in helping to bail out Portugal in what would be a notable reversal of former colony-metropole relations. Portugal has rejected a bailout from the EU and former and present Brazilian leaders Lula da Silva and Dilma Rousseff encouraged Portugal to make the same move with respect to the IMF this week.
Other opinions on Brazil and Latin America on the international stage: IPS on Latin America’s eastward gaze. Gabriel Elizondo at Al-Jazeera suggests Brazil’s regional economic hegemony has triggered the formation of a new Chile-Peru-Colombia-Mexico economic bloc. Mexico’s announcement yesterday that it is interested in joining UNASUR may complicate that logic a bit. And Greg Grandin, also at Al-Jazeera, on the US portfolio within Brazil’s increasingly global agenda. According to Grandin, US-Brazil relations are riddled with greater tensions and differences than reporting on Obama’s visit last week may have suggested.
Today’s bullet points:
· In Colombia today, Venezuelan President Hugo Chavez will meet with Colombian President Juan Manuel Santos. El Universal says bilateral trade issues are on the agenda, but, according to El Tiempo, the possible extradition of Venezuelan drug lord Walid Makled back to Venezuela looms largest. Colombia’s Supreme Court opened the door for that extradition to occur last week, but the decision has, in many ways, become a rallying point for the forces of anti-chavismo. Congressman Connie Mack (R-FL) has led the charge. He was joined by Diego Arria, Venezuela’s representative to the UN in the early 1990s, who wrote to Juan Manuel Santos this week, urging Colombia not to go through with Makled’s extradition to Venezuela. Roger Noriega, meanwhile, tells the Nuevo Herald that Makled’s network has connections to Hezbollah and thus should be brought to the US. Joel Hirst at the Council on Foreign Relations offers similar arguments at the Huffington Post. More reporting on the matter from the Wall Street Journal.
· In Mexico, a different Chavez, Attorney General Arturo Chavez Chavez, announced his resignation Thursday, citing “personal reasons.” On the job for the last 18 months, Chavez has been in charge of efforts to reform the countries justice system while simultaneously leading efforts against the country’s drug cartels. BBC says Chavez will be replaced by investigative prosecutor Marisela Morales, who will become Mexico's first female attorney general if her nomination is approved by Mexico’s Senate.
· Also on Mexico, BBC Mundo reports that a UN working group on Forced and Involuntary Disappearances issued a report to the Mexican government this week following a two-week mission to the country. Among the UN’s notable recommendations: the suggestion that the military be removed from Mexico’s streets. The Washington Post with an interesting look at how the collapse of La Familia’s power in Michoacan and the arrest of several other major capos (20 of Mexico’s 37 most wanted traffickers, according to Mexican officials) has done little, if anything, to change local conditions or perceptions about cartel power and activities. The Post: “At a storefront drug treatment center [in Apatzingan, the city where La Familia was founded] filled with toothless, tattooed men lounging on bunk beds, director Ulises Silva said that in the three months after [La Familia founder Nazario]Moreno’s killing, “nothing has changed” in Apatzingan. ‘The narcos will never go away,’ [Silva] said. ‘The truth is that the people like the narcos more than the government.’” And Laura Carlsen on both “why Mexico’s war on drugs is unwinnable” and why that does not mean Mexico has to resign itself to the “unbridled power of the drug cartels.”
· On the US side of the drug wars, video and testimony yesterday from Rep. Michael McCaul’s House hearing on US Homeland Security’s “Role in the Mexican war on drug cartels.” In the Washington Post, Clint McDonald, sheriff of Terrell County, Texas, on the “spillover effects” of drug violence in Mexico and his criticisms of the current border security strategy of Homeland Security.
· Insight Crime highlights Southcom commander Gen. Douglas Fraser’s statement this week that the “Northern Triangle” (Guatemala, El Salvador, and Honduras) may now be be the deadliest region on earth, outside of active war zones. A full wrap-up of the Fraser briefing from Southcom. Insight also looks at what impact the recently announced $200 million in new security aid for the sub-region might mean for El Salvador.
· In Honduras, AP reports on the on-going teacher protests – what the news agency calls a “catalyst for a wider political movement against the government, and to demand the return from exile of ousted former President Manuel Zelaya.” Human Rights Watch, meanwhile, has issued a new statement demanding allegations of excessive use of force against protestors be investigated by Honduran officials. HRW cites three specific cases – among them the death of Ilse Velázquez Rodríguez on March 18. And from the Aguan Valley, Real News looks at parallel land struggles which continue to be led by campesino groups there.
· A new Human Rights Watch statement also criticizes President Rafael Correa’s recent decision to file a criminal libel suit against Ecuadorean journalist, Emilio Palacio, and three members of the board of directors of the Guayaquil-based newspaper El Universo.
· In Venezuela, Dow Jones reports that a process of disbanding potentially corrupt police departments in the country began this week. The Caracas Metropolitan Police will be dismantled within the next 90 days, according the government’s Official Gazette.
· In Peru, La Republica reports that Ollanta Humala has publicly asked Venezuelan President Hugo Chavez to refrain from inserting himself into Peru’s electoral campaign. The AP and the Economist with more on the campaign and Humala.
· And finally, the AP reports that a former army general was sentenced to life in prison for murders committed under the banner of Operation Condor at the infamous Automotores Orletti torture center. Three ex-state agents were also sentenced to 20+ years in prison alongside Gen. Eduardo Cabanillas.