LATIN AMERICA ADVISOR A DAILY PUBLICATION OF THE DIALOGUE www.thedialogue.org Tuesday, November 17, 2020 BOARD OF ADVISORS FEATURED Q&A TODAY’S NEWS Diego Arria Director, Columbus Group POLITICAL Devry Boughner Vorwerk What Path Lies Peru’s Congress CEO, DevryBV Sustainable Strategies Selects Sagasti as Joyce Chang Global Head of Research, Ahead for Peru’s Interim President JPMorgan Chase & Co. Peru’s Congress selected centrist Paula Cifuentes lawmaker Francisco Sagasti Director of Economic & Fiscal Affairs, Latest President? as the country’s new president, Latin America & Canada, Philip Morris International Peru’s third in a week. Sagasti is Marlene Fernández to serve until next July. Corporate Vice President for Page 2 Government Relations, Arcos Dorados (McDonald’s) Peter Hakim BUSINESS President Emeritus, Inter-American Dialogue WhatsApp to Donna Hrinak ‘Soon’ Launch Senior VP, Corporate Affairs, Royal Caribbean Group Payments Jon E. Huenemann Service in Brazil Former Corporate and Government Senior Executive WhatsApp will “soon” be able to James R. Jones Lawmaker Francisco Sagasti was selected Monday as Peru’s new interim president. His prede- launch its payments service in Chairman, cessor lasted just five days in office. // Photo: Agencia Andina. Brazil, said central bank chief Monarch Global Strategies Roberto Campos Neto. WhatsApp Craig A. Kelly Peru’s Congress on Monday selected centrist lawmaker originally rolled out the service in Senior Director, Americas Brazil last June, but the central Int’l Gov’t Relations, Exxon Mobil Francisco Sagasti as Peru’s new interim president—the bank and antitrust regulator shut John Maisto country’s third in a week. Legislators selected Sagasti, an Director, U.S. Education it down, pending a review. Finance Group Q engineer from the centrist Purple Party, following Sunday’s Page 2 Nicolás Mariscal resignation of interim President Manuel Merino, who stepped down Chairman, Grupo Marhnos amid violent protests after just five days in office. Merino had replaced POLITICAL Thomas F. McLarty III President Martín Vizcarra, whom Congress removed from office on Nov. Hurricane Iota Chairman, 9. Legislators had declared Vizcarra “morally unfit” for office over his McLarty Associates Slams Nicaragua handling of the Covid-19 pandemic and allegations of corruption, which Beatrice Rangel Hurricane Iota pummeled the Director, he has denied. Newspapers and analysts have called Vizcarra’s ouster AMLA Consulting LLC coast of Nicaragua Monday night as a strong Category 4 storm. The Jaana Remes a “coup,” and the protests it sparked left at least two dead and were the Partner, largest in Peru in two decades. What is at the root of Peru’s political hurricane is hitting the same area McKinsey Global Institute that was devastated by Hurricane Ernesto Revilla instability, and to what extent are protests likely to continue and intensi- Eta less than two weeks ago. Head of Latin American fy? What will the next five months hold for Peru ahead of the scheduled Page 2 Economics, Citi April 2021 elections? What implications will the crisis have for the Gustavo Roosen Chairman of the Board, country’s already hard-hit economy and investment climate? Envases Venezolanos Andrés Rozental President, Rozental & Cynthia McClintock, professor of political science and inter- Asociados national affairs at The George Washington University: “The Shelly Shetty Managing Director, Sovereigns root cause of the impeachment was elites’ pushback against Fitch Ratings A Vizcarra’s anti-corruption reforms. Vizcarra championed the prosecution of under-the-table payments by companies to politicians—a practice, entrenched for centuries, that had catalyzed the prosecution of all four presidents elected since 2001 and scores of additional authorities. Many legislators feared an end to their own immunity from prosecution. Other legislators have personal stakes in for-profit univer- Iota made landfall Monday night. // Image: U.S. Nat’l Hurricane Center. Continued on page 3 COPYRIGHT © 2020, INTER-AMERICAN DIALOGUE PAGE 1 LATIN AMERICA ADVISOR Tuesday, November 17, 2020 POLITICAL NEWS before he resigned amid deadly protests. The NEWS BRIEFS protests, in which as least two people have Hurricane Iota been killed, erupted after lawmakers swiftly At Least 13 Killed in removed President Martín Vizcarra from Tanker Truck Explosion Slams Nicaragua as office on Nov. 9. Sagasti was sworn in as the president of Congress and shortly afterwards, in Mexico’s Nayarit State Category 4 Storm he reached the required majority vote in order A double-tanker truck transporting liquefied to become president, leading to applause in cooking gas on Monday flipped on a highway in Hurricane Iota has made landfall in Nicaragua, the chamber, the Associated Press reported. the state of Nayarit in western Mexico, caught just miles away from where Hurricane Eta Sagasti won the votes of 97 lawmakers, with fire and exploded, killing at least 13 people, au- hit less than two weeks ago, with possible just 26 voting against him, CNN reported. “We thorities said, the Associated Press reported. “life-threatening” flooding, catastrophic winds will do everything possible to return hope to The victims were found still in their vehicles, and mudslides, CNN reported. The hurricane is the people and show them they can trust in burned beyond recognition. The truck driver expected to be felt throughout Central America us,” Sagasti said, the AP reported. Sagasti and appears to be among those killed. Similar and Mexico’s Yucatán Peninsula, as well as members of his Purple Party bloc were among incidents involving double-trailer freight trucks Jamaica and as far south as Colombia. The only 19 of 130 legislators who voted against have occurred in Mexico in recent years. storm hit in the town of Haulover in Nicaragua removing Vizcarra from office last week. And at 10:40 p.m. Eastern Time as a Category 4 unlike Vizcarra, Sagasti has a party in Congress hurricane with maximum sustained winds near to represent him. A year ago, when Sagasti 155 miles per hour, according to the National was a candidate for a seat in Congress, he Leftist Argentine Senators Hurricane Center. Haulover is just 15 miles told the Advisor that the “main contribution” of Demand Concessions south of where Eta had struck, potentially members of Congress “is to behave decently From Int’l Monetary Fund leaving some of the country’s most vulnerable and begin the process of restoring public A group of leftist Argentine senators loyal to areas devastated for years to come, according trust in politics.” Sagasti is to serve as interim Cristina Fernández de Kirchner, a former pres- to the report. [Editor’s note: See Q&A in Mon- president until next July when a new president, ident and current vice president, sent a letter day’s issue of the Advisor.] elected in April, takes office. Peru has been to the International Monetary Fund, demanding hard-hit by the Covid-19 pandemic, with among that the lender refrain from attaching condi- the world’s highest per-capita death tolls from tions to a new loan program and also publicly Peru’s Congress the disease, Bloomberg News reported. Its acknowledge its part of the responsibility for economy contracted 30 percent in the second Selects Sagasti as the country’s ongoing economic problems, the quarter, the Financial Times reported. The Inter- Financial Times reported. The senators also Interim President national Monetary Fund expects the economy pushed for the country to receive a five-year to contract 13.9 percent this year. grace period before repaying a $44 billion loan, Peru’s Congress on Monday chose Francisco as well as lower interest rates and a repayment Sagasti, a centrist lawmaker and technocrat, schedule spread over decades. as the country’s new interim president. A BUSINESS NEWS 76-year-old former World Bank official, Sagasti is the country’s third president in a week, following Sunday’s resignation of Manuel WhatsApp Will ‘Soon’ Suriname Asks Creditors Merino, whose presidency lasted just five days Launch Payments in for Bond Payment Deferral CORRECTION Brazil: Campos Neto Suriname’s government has asked creditors to allow a payment deferral on its two bonds, A news article in Monday’s Advisor which amount to $675 million, in what analysts incorrectly said Reina Mejía, who was Facebook’s WhatsApp messaging platform will say could be a preview of a broader debt approved as executive vice president of “soon” be able to offer peer-to-peer electronic restructuring, Reuters reported Monday. In a the Inter-American Development Bank, is payments in Brazil, the country’s central bank statement on Saturday, the government of new the highest-ranking woman ever to serve chief, Roberto Campos Neto, said Monday, President Chan Santokhi, who took office in the institution. In fact, other women have Reuters reported. “WhatsApp will start doing July, announced the launch of a consent solic- served in that role, but Mejía is the high- P2P soon. I have talked a lot with their CEO, itation for its 2023 and 2026 bonds. The con- est-ranking woman from Latin America to we are making good progress. He has told me sent solicitation expires on Nov. 23. [Editor’s serve in that position. that the process [with us] was faster than in note: See related Q&A in the Aug. 5 Advisor.] COPYRIGHT © 2020, INTER-AMERICAN DIALOGUE PAGE 2 LATIN AMERICA ADVISOR Tuesday, November 17, 2020 other countries,” said Campos Neto. “Our only FEATURED Q&A / Continued from page 1 concern is that we must go through all the approval criteria and that we have a system sities, which are threatened by new, higher unrestrained power to congressional major- that fosters competition.” The central bank standards. Another cause of the impeach- ities, which is problematic when checks and chief made the remarks at the launch of the ment was legislators’ political ambitions. balances are fragile, as in Peru.