LATIN AMERICA ADVISOR A DAILY PUBLICATION OF THE DIALOGUE www.thedialogue.org Friday, May 3, 2019 BOARD OF ADVISORS FEATURED Q&A TODAY’S NEWS Diego Arria Director, Columbus Group ECONOMIC Devry Boughner Vorwerk Will U.S. Sanctions First Lawsuits Corporate VP, Global Corporate Affairs Cargill Filed Over Seized Joyce Chang Global Head of Research, Force Ortega From Property in Cuba JPMorgan Chase & Co. The first of many lawsuits Marlene Fernández expected by U.S. citizens over Corporate Vice President for Power in Nicaragua? property confiscated during the Government Relations, Arcos Dorados Cuban Revolution were filed in a Peter Hakim U.S. court. President Emeritus, Page 2 Inter-American Dialogue Donna Hrinak President, Boeing Latin America BUSINESS Jon Huenemann Heineken Acquires Retired VP, U.S. & Int’l Affairs, Philip Morris International Majority Stake James R. Jones Chairman, in Ecuador’s Monarch Global Strategies Biela y Bebidas Craig A. Kelly The Dutch brewer acquired the Director, Americas International Large-scale anti-government demonstrations began more than a year ago in Nicaragua. A Gov’t Relations, Exxon Mobil stake in the Ecuadorean company demonstration last August is pictured above. // File Photo: Civic Alliance for Justice and John Maisto Democracy. from a group of investors. The Director, U.S. Education country’s economic growth and Finance Group Protesters in Nicaragua recently marked the one-year demographics led to the purchase, Nicolás Mariscal anniversary of large-scale demonstrations against the gov- a company executive said. Chairman, Page 2 Grupo Marhnos ernment of President Daniel Ortega. The administration of Thomas F. McLarty III Q U.S. President Donald Trump has imposed multiple rounds Chairman, POLITICAL McLarty Associates of sanctions against Ortega’s government, and U.S. National Security Carlos Paz-Soldan Advisor John Bolton included Nicaragua, along with Cuba and Venezue- Maduro Gov’t Partner, DTB Associates, LLP la, as part of what he calls the “troika of tyranny.” To what extent will the Begins Pursuing Beatrice Rangel U.S. sanctions succeed in forcing Ortega from power? What is the Trump Opponents Director, AMLA Consulting LLC administration’s strategy in applying the sanctions against the Ortega Venezuelan President Nicolás Maduro’s government began Jaana Remes government? What do the actions mean for investment in Nicaragua Partner, pursuing opposition leaders, in- McKinsey Global Institute and businesses operating there? What unintended consequences could cluding Leopoldo López, who were Ernesto Revilla result from the sanctions, and how might the United States need to shift involved in this week’s violent Head of Latin American its approach as circumstances change? protests. Economics, Citi Page 2 Gustavo Roosen Chairman of the Board, Envases Venezolanos Marion Smith, executive director of the Victims of Com- Andrés Rozental munism Memorial Foundation in Washington: “The Ortega President, Rozental & Asociados and Senior regime has been using false promises of electoral reform, di- Policy Advisor, Chatham House alogue, the release of political prisoners and the pretense of Shelly Shetty A negotiations to manipulate the opposition and the international communi- Head of Sovereign Ratings, Latin America, Fitch ty. We were concerned when the United States gave Ortega an ultimatum Roberto Sifon-Arevalo and froze the sanctions for some months to promote the failed dialogue. Managing Director, Americas Sovereign & Public Finance Ratings, Since the regime has ignored this opportunity, continued the repression Standard & Poor’s and failed to start Nicaragua’s return to democracy, it is appropriate for the U.S. government to issue new sanctions. The United States has added Laureano Ortega Murillo, the son of Daniel Ortega and Rosario Murillo, to the list of sanctioned individuals. The sanctions also included a continu- Maduro // File Photo: Venezuelan Government. Continued on page 3 COPYRIGHT © 2019, INTER-AMERICAN DIALOGUE PAGE 1 LATIN AMERICA ADVISOR Friday, May 3, 2019 POLITICAL NEWS on Wednesday Maduro said his government NEWS BRIEFS would pursue those who participated in what Venezuela’s Maduro he has called an attempted coup. “Justice is HSBC Reports Higher looking for them, and sooner or later they will Revenues From Latin Pursues Opposition pay in prison for their treason and crime,” he said. Among those marching alongside Maduro America, Beats Estimates Following Protests on Thursday was Defense Minister Vladimir Global banking giant HSBC reported first-quar- Padrino, who reiterated his loyalty to Maduro. ter earnings today that beat market expecta- Venezuelan President Nicolás Maduro’s govern- Venezuela’s opposition and U.S. officials have tions, in part due to increased revenues from ment on Thursday began pursuing opposition said Padrino participated in secret discussions Latin America, CNBC reported. The bank said leaders involved in this week’s violent protests earlier in the week on ousting Maduro. Howev- its profit before tax in the first quarter was and calls for the military to overthrow his er, an unnamed person familiar with the talks $6.21 billion overall, a 30.7 percent jump government, The Wall Street Journal reported. told The Wall Street Journal that Padrino ap- from last year’s $4.75 billion. Adjusted profit A court in Caracas ordered the jailing of oppo- peared to remain loyal to Maduro and informed from Latin America rose to $387 million in the sition leader Leopoldo López, who appeared him about the talks. [Editor’s note: See related quarter ending March 31, up from $148 million early Tuesday morning alongside National Q&A in the Feb. 21 issue of the Advisor.] the quarter before, which was helped from a Assembly President Juan Guaidó at an air disposal gain of $24 million in the region. base, and joined Guaidó in calling for a military uprising. López, whom the court ordered to be ECONOMIC NEWS locked up in Venezuela’s Ramo Verde prison, had been on house arrest for two years and Heineken Acquires said Tuesday that sympathetic members of the First Lawsuits Filed Majority Stake in country’s intelligence services had freed him. Over Expropriated Ecuador’s Biela y Bebidas López had previously been imprisoned in Ramo Amsterdam-based Heineken said Thursday Verde for three and a half years. On Tuesday, Property in Cuba it had acquired a majority stake in Guaya- López took refuge in the Spanish Embassy in quil-based brewer Biela y Bebidas del Ecuador Caracas. Spain’s government said Thursday The first of an expected avalanche of lawsuits from a group of mainly local investors. In a that it will not allow Venezuelan authorities to from U.S. citizens against companies doing statement, Heineken’s president for the Amer- enter the embassy to arrest López, BBC News business in Cuba was filed Thursday, as a new icas, Marc Busain, said Ecuador’s favorable reported. At the embassy, López told reporters, U.S. policy took effect allowing claims on prop- demographics and economic growth pros- “This dictatorship is going to end,” The Wall erty confiscated by the Castro regime, The Wall pects led the company to make the purchase. Street Journal reported. He added, “We can’t Street Journal reported. The filings in the U.S. Ecuador’s beer market currently has a relatively lose hope. That is what the dictatorship wants.” District Court in Miami targeted cruise ship low consumption per capita of 39 liters when Hours after López was ordered to be jailed, operator Carnival Corp. Javier Garcia-Bengo- compared to other South American countries, Venezuela’s chief prosecutor filed criminal chea, of Jacksonville, Fla., is seeking redress according to Busain. The companies did not charges against National Assembly Vice Presi- for his family’s 82.5 percent stake in commer- disclose financial terms of the deal. dent Edgar Zambrano, accusing him of treason, cial waterfront property in the port of Santi- conspiracy and insurrection, among other ago de Cuba, which the Cuban government crimes. The whereabouts of Guaidó, whom confiscated in 1960, and Mickael Behn, based dozens of countries recognize as Venezuela’s in Lexington, Ky., filed his suit over property he Brazil’s Azul Registers legitimate interim president, were unclear on said Castro expropriated and Carnival used for for Avianca Brasil’s Thursday. It was also unclear where several embarking and disembarking its passengers in Bankruptcy Auction of Guaidó’s top aides were located. Nearly a Havana, according to the report. Last month, dozen aides to Guaidó, including his chief of U.S. President Donald Trump followed through Azul Linhas Aéreas Brasileiras has registered staff, have been jailed in recent months. In a on pledges to end a two-decade-old waiver on to participate in an auction that will result in march that was billed as a display of loyalty, provisions of the 1996 Helms-Burton Act, in the distribution of assets of Avianca Brasil, Re- Maduro on Thursday strode with military offi- a bid to add more economic pressure on the uters reported Thursday. The auction is sched- cers at the main Caracas military base. At the struggling Communist island, which has been uled for next week, and Azul previously said it march, Maduro called on Venezuelans to fight seeking billions of dollars in foreign invest- would not participate. Avianca Brasil filed for and defeat “coup plotters who sell themselves ment. The Justice Department has certified bankruptcy protection in December and said it to Washington’s dollars.” In a televised address nearly 6,000 claims for property confiscated in would auction some of the slots that allow it to operate flights from crowded airports. COPYRIGHT © 2019, INTER-AMERICAN DIALOGUE PAGE 2 LATIN AMERICA ADVISOR Friday, May 3, 2019 Cuba holding a value, with interest, of roughly FEATURED Q&A / Continued from page 1 $8 billion. Officials in the European Union and Canada vowed to oppose the change in U.S. ation of the July 5 sanction against the cor- productive infrastructure and help reduce policy, potentially through the World Trade Or- rupt Venezuela-Nicaragua business Albanisa poverty.