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LATIN AMERICA ADVISOR a DAILY PUBLICATION of the DIALOGUE Friday, June 1, 2018 LATIN AMERICA ADVISOR A DAILY PUBLICATION OF THE DIALOGUE www.thedialogue.org Friday, June 1, 2018 BOARD OF ADVISORS FEATURED Q&A TODAY’S NEWS Diego Arria Director, Columbus Group ECONOMIC Devry Boughner Vorwerk Corporate VP, Global Corporate Affairs Is Bolsonaro the Trump Slaps Cargill Joyce Chang Tariffs on Mexico, Global Head of Research, Candidate to Canada, E.U. JPMorgan Chase & Co. Dirk Donath U.S. President Donald Trump’s Senior Partner, administration removed exemp- Catterton Aimara Beat in Brazil? tions for Mexico, Canada and the Marlene Fernández European Union that had shielded Corporate Vice President for them from steel and aluminum Government Relations, Arcos Dorados tariffs. Officials in the countries affected vowed to retaliate. Peter Hakim President Emeritus, Page 2 Inter-American Dialogue Donna Hrinak BUSINESS President, Boeing Latin America Jon Huenemann Colombia Vice President, U.S. & Int’l Affairs, Philip Morris International Investigating Top James R. Jones Ecopetrol Officials Chairman, Monarch Global Strategies Colombian prosecutors are investigating the CEO and other Craig A. Kelly Right-wing candidate Jair Bolsonaro has been topping opinion polls ahead of Brazil’s presiden- Director, Americas International tial race. // File Photo: Bolsonaro Campaign. top officials of state oil company Gov’t Relations, Exxon Mobil Ecopetrol on allegations of John Maisto neglect following an oil spill last Director, U.S. Education Brazilian President Michel Temer on May 22 withdrew from March. Finance Group the country’s presidential race and endorsed his former fi- Page 3 Nicolás Mariscal Chairman, nance minister, Henrique Meirelles. Recent polls show right- Grupo Marhnos Q wing candidate Jair Bolsonaro in the lead with 18.3 percent POLITICAL Thomas F. McLarty III Chairman, support, and environmentalist Marina Silva and leftist Ciro Gomes Assange Can Stay McLarty Associates battling for second place with 11.2 percent and 9 percent, respectively. Carl Meacham in Embassy With Associate VP for Latin America Former president Luiz Inácio Lula da Silva has been the race’s front-run- Rules: Moreno Int’l Advocacy Division, PhRMA ner, but he was jailed in April and has been all but formally barred from Carlos Paz-Soldan Ecuadorean President Lenín Partner, running. With four months until election day on Oct. 7, how is Brazil’s Moreno said WikiLeaks founder DTB Associates, LLP presidential race shaping up? Will Bolsonaro maintain his lead? Which Julian Assange can remain in the Beatrice Rangel factors will most affect the race between now and October? country’s embassy in London as Director, long as he adheres to the condi- AMLA Consulting LLC tions of his asylum. Gustavo Roosen Page 2 Chairman of the Board, Peter Hakim, member of the Advisor board and president Envases Venezolanos emeritus of the Inter-American Dialogue: “The truckers’ Andrés Rozental President, Rozental & strike, the government’s inept response and the public Asociados and Senior reaction to both have increased the prospect that extreme Policy Advisor, Chatham House A right-wing populist Jair Bolsonaro will be Brazil’s next president. Once Roberto Sifon-Arevalo Managing Director, Americas again, Brazilians are showing how little they trust the country’s leadership. Sovereign & Public Finance Ratings, Standard & Poor’s Despite its brutal economic damage and disruption, polls report that nine in 10 Brazilians think the strike is justified. The same percentage feel the official response was bungled. The now frighteningly commonplace calls for military intervention also points to the mounting scorn for politics and politicians. Brazil’s political center continues to shrink. The center’s prime representative in this October’s election, former São Paulo Governor Ger- Assange // File Photo: Ecuadorean aldo Alckmin, is the preferred candidate of only 5 to 8 percent of voters in Government. Continued on page 2 COPYRIGHT © 2018, INTER-AMERICAN DIALOGUE PAGE 1 LATIN AMERICA ADVISOR Friday, June 1, 2018 ECONOMIC NEWS with their own tariffs on U.S. products includ- NEWS BRIEFS ing pork bellies, grapes, apples and flat steel, Trump Slaps Tariffs Reuters reported. Canada’s list of countermea- Strikes by Brazilian sures would include tariffs on U.S. metals and Oil Workers, Truckers food products such as yogurt, pizza and cu- on Mexico, Canada, Wind Down European Union After 11 days of paralyzing transportation blockades and fresh oil worker strikes this Effective today, the administration of U.S. Pres- week, Brazil showed signs of returning to ident Donald Trump has removed an exemption normal on Thursday, Reuters reported. The oil that had shielded allies Canada, Mexico and workers union, FUP, unexpectedly called off the European Union from 25 percent tariffs on a 72-hour strike it began on Wednesday after steel imports and 10 percent tariffs on alumi- defying a court order against it. Meanwhile, num imports, the Associated Press reported. Brazil’s minister of institutional security, U.S. Commerce Secretary Wilbur Ross, who as Trump // File Photo: White House. Sérgio Etchegoyen, said all roadblocks put up a businessman in the early 2000s purchased by truckers seeking lower diesel fuel prices and then sold distressed U.S. steel companies, cumbers, as well as household products such from the government had been removed. Only said the United States will place quotas or vol- as mattresses and refrigerators. The United isolated groups of truckers were still causing ume limits instead of tariffs on other countries States argues that protecting the steel industry problems, according to the report. such as Argentina, Australia, Brazil and South is in the country’s national security interest, a Korea, CNBC reported. As the peso fell to its classification that World Trade Organization lowest level in almost 15 months Thursday on rules allow member countries to determine the news, Mexican officials vowed to retaliate for themselves. “The WTO language is pretty Thousands Still Without Power in Puerto Rico as FEATURED Q&A / Continued from page 1 Hurricane Season Begins recent polls, compared to nearly 20 percent upend Brazil’s political system. This is what Hurricane season begins today, and more than for Bolsonaro. Alckmin’s badly divided party Bolsonaro represents. This is his declared 11,000 people are still without power in Puerto has been shamed by revelations of exten- ambition—an ambition which Brazilians Rico, more than eight months after Hurricane sive corruption, just like most other parties. these days are demonstrating an escalating Maria pummeled the U.S. territory, CBS News Another centrist candidate is Henrique readiness to support.” reported. It could still take another two months Meirelles, who until last month served as before electricity is completely restored, Brazil’s very capable finance minister and is João Feres Júnior, director according to the Puerto Rico Electric Power Au- trying to run on his record. But the econom- of the Institute of Social and thority. In the municipality of Yabucoa, where ic continuity is not an attractive electoral Political Studies (IESP) of the Maria made landfall, 38 percent of residents platform these days. Without currently jailed State University of Rio de Janei- A still remain without electricity. Luiz Inácio Lula da Silva, who will almost ro: “This election so far has been the most certainly be declared ineligible to run, Bol- unpredictable in the last four decades. This sonaro leads in every poll, but Marina Silva is mostly due to the devaluation of politics and Ciro Gomes are within striking distance. and political institutions produced by their Expelled Venezuelan Both are experienced in politics. They have unrelenting association with corruption. Diplomat Still in U.S. each held high office and have sought the Brazilian big media has played a major role presidency before, although neither has won in this process, lambasting the elected A career Venezuelan diplomat who was enough votes to participate in the runoff powers (legislative and executive) while expelled last week from the United States fol- stage. Their political parties are small and glorifying the judicial branches of govern- lowing Venezuelan President Nicolás Maduro’s weak, although Ciro is in position to gain ment (judiciary and prosecutor general). As move to expel the top U.S. diplomat in Caracas Lula’s support, which could give him a po- a result, established parties and politicians is still in the United States even though he had tentially important boost. The major liability are having trouble increasing their electoral been given 48 hours to leave, the Associated of both Marina and Ciro, however, is that base for the presidential race. In this sce- Press reported. Jarlet Sánchez, who had been Brazilian voters are unlikely to see either as nario, candidates who present themselves Venezuela’s deputy consul general in Houston, having the capacity or will to challenge and as outsiders have an advantage. This is is attempting to seek legal permanent residen- cy under a provision that some Eastern Bloc Continued on page 4 diplomats used during the Cold War to defect. COPYRIGHT © 2018, INTER-AMERICAN DIALOGUE PAGE 2 LATIN AMERICA ADVISOR Friday, June 1, 2018 clear that on issues of national security; it’s A year ago, Swedish prosecutors dropped their ANH, over a March oil spill, El Tiempo reported. up to each member to decide,” former General investigation into rape allegations against More than 500 barrels of oil spilled into local Electric trade attorney R. Michael Gadbaw told Assange; however, he would still likely be rivers from the Lizama field in Barrancaberme- NPR this week. Other countries affected said arrested if he leaves the embassy and could be ja, polluting 24 kilometers of waterways, dis- Thursday they are planning retaliatory tariffs on extradited to the United States to face charges placing 23 families and killing 2,000 animals. U.S. goods, as well. over the release of classified documents Felipe Bayón Pardo, who has been Ecopetrol’s through WikiLeaks. top executive since last September, and his predecessor, Juan Carlos Echeverry, are among POLITICAL NEWS the 12 under investigation.
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