Saturday, June 28, 2014

VOXXI: Chilean President Bachelet visits Washington

"Chilean President Bachelet visits Washington"
W. Alejandro Sanchez
June 28, 2014
Originally published:

Chilean President Michelle Bachelet will meet with President Barack Obama on Monday, June 30th, as part of her brief visit to Washington. She will also speak at several organizations while in the U.S. capital.
Consolidating Washington-Santiago relations will apparently be a priority for President Bachelet during her second presidential term. The two governments certainly have plenty of issues that can bring them together.

Points of discussion

One way to view the upcoming encounter is by briefly looking at how the event has been reported in both countries.
On the one hand, the White House released a (very) brief press release on May 8. The document explains how Presidents Bachelet and Obama will discuss “[United Nations] Security Council matters, other multilateral and regional issues, and ongoing negotiations on the Trans-Pacific Partnership.” Apart from the UNSC and the TPP negotiations, the press release is vague about specific topics as it simply mentions global security, social inclusion and free trade.
On the other hand, the Chilean media has gone to greater lengths to stress the importance of this meeting and the possible conversation points. A June 26 commentary in the Chilean daily El Mercurio explains that the meeting will allow President Bachelet to discuss her vision of Chile’s future foreign policy, broadly speaking. The commentary also examines the Trans Pacific Partnership, which will “strengthen [Chile’s] relations with Asia on the long term.” Moreover, El Mercurio highlights how, in order to decrease its oil-dependency, Chile aspires to increase import shale gas from the U.S.
Apart from her meeting with President Obama, President Bachelet will have a busy time in Washington.
On Monday, she will appear at the Brookings Institution, a major DC think tank.  The following day, in a keynote presentation at the U.S. Chamber of Commerce, she will discuss “current changes in Chile’s economic policies,” as well as Chile-U.S. commercial relations. Additionally, the Organization of American States will host a Protocol Session in its DC headquarters in her honor – she will likely meet with the OAS Secretary General Jose Miguel Insulza, also a Chilean national.

Interests and counter interests

President Bachelet’s visit to Washington occurs at an interesting time. At the foreign policy level, Chile could become Washington’s new best friend in South America (Colombia notwithstanding), considering Washington’s tense relations with Brazil since the 2013 NSA revelations.
The Chilean leader recently attended a fairly successful summit of the Pacific Alliance, a group of Latin America’s most vibrant economies. By following up her trip to Mexico with another to Washington, Chile’s international pedigree will only grow.
However, while the U.S. is focused on Russia and the destabilization of Iraq, it would be shortsighted to assume that Washington does not have its own interests to bring up regarding Chile’s role in the global arena.
Chile is a non-permanent member of the UNSC until December 2015 and hence, should the U.S. want to push for a resolution within the next year and a half (i.e. regarding Syria, Iraq, or Ukraine), it would be helpful for Washington to have several UNSC members, like Santiago, on its side.
Additionally, while Chile is interested in the TPP, Santiago has resisted some of Washington’s requirements. Specifically, Chile is concerned about the TPP’s stance on copyright, patents, and intellectual property ownership. The Chilean media speculate that the TPP in its current form could mean more expensive imports of U.S. medicines.
When asked by the Washington Post about her stance on the TPP, the Chilean head of state remarked, “we don’t have much information on the process regarding the scope and limitations of the TPP…. We will protect all the agreements we already have established with the U.S.”, reflecting a diplomatically neutral answer.
Timing is not on the side of the White House as mid-term elections are set to occur this November. It would be ideal for the Obama administration to send a TPP agreement to Congress before then. In other words, President Obama will likely pressure the South American leader to support the TPP when they meet on Monday.
Finally, it will be interesting if President Bachelet discusses more sensitive issues during her time in Washington, besides U.S.-Chile relations. These include ongoing protests from the Mapuches, an indigenous group of Chile, the territorial dispute with Bolivia, or the situation in Venezuela.

Lots of praise

President Bachelet will receive a VIP treatment during her upcoming trip to Washington, including a meeting with President Obama, numerous engagements and a reception at the OAS.
Moreover, there is a positive attitude towards Chile’s current situation. For example, the Center for Strategic and International Studies explains, “Chile is one of two Latin American countries in the Organization for Economic Co-operation and Development and is poised to become the first developed nation in South America.”
With this ideal momentum, President’s Bachelet trip to Washington will hopefully conclude with some positive agreement. Bolstering her country’s image is always beneficial, but it is not necessarily enough.

Monday, June 23, 2014

Blouin Beat: Politics - Big sanctions delisting sign of moribund Cali Cartel?

"Big Sanctions delisting Sign of Moribund Cali Cartel?"
W. Alejandro Sanchez
Blouin Beat: Politics
June 23, 2014
Originally published:

On June 19 the U.S. Department of the Treasury announced that it had removed 308 “individuals and entities from the Specially Designated Nationals and Blocked Persons list (SDN List)” – people and groups that were regarded as affiliated with the Cali Cartel, a Colombian drug trafficking organization. This is the largest single delisting (as Treasury’s release points out) in the history of the Treasury Department’s sanctions programs.
The reason for the delisting? According to Treasury, the Cali Cartel has suffered a financial collapse.
A quick overview of this world-famous criminal entity is in order. The cartel emerged during the 1980s, obtaining its name due to its origins in Cali, a city in Western Colombia. At the height of its power, the syndicate was a strong opponent to the Medellin Cartel, led by the infamous Pablo Escobar. (See this August 1988 report from El Pais). Print media from the late 1980s and early 1990s also recount the influence of this dangerous organization. In 1995, the U.S. government declared that the Cali Cartel was responsible for 80% of the cocaine being trafficked into the country.
But over the next decade, the Cali Cartel suffered various defeats, both at the hands of rival criminal groups and operations by the U.S.-backed Colombian security agencies. Extradition hurt the group as well: in December 2004, Cartel boss Gilberto Rodriguez Orejuela (AKA “The Chess Player”) was extradited to the U.S. This was a significant development: Orejuela was the biggest Colombian drug player extradited up until that point in time — he was wanted by the U.S. on charges of cocaine trafficking and money laundering. In 2006, Gilberto and his brother Miguel, who had also been extradited, declared themselves guilty of trafficking cocaine in a Miami court. They were sentenced to 30 years in prison. (I would recommend reading Los Rodriguez Orejuela: El Cartel de Cali y Sus Amigos for more information about the life and crimes of the Orejuela family and the Cali Cartel).
The Colombian media has been quick to report the decision of the Office of Foreign Assets Control (OFAC) to remove the 308 names from its sanctions list. The renowned Colombian magazine Semana has extensively discussed the cartel’s historical influence in the South American country. It explains that the cartel had a “spider web” of enterprises under its control, such as investment firms and a chain of drug stores called Drogas La Rebaja. Even more, the popular Colombian football team America de Cali was also placed in OFAC’s list of sanctions in 1997, when U.S. officials demonstrated that the club was a conduit in the cartel’s money laundering operations — it was controlled by the aforementioned Miguel Rodriguez Orejuela, who had purchased the team in the early 1980s. The club spent 16 years on OFAC’s list and was finally removed in 2013.
It is important to note how the removal of these 308 names from OFAC’s list is being reported. Understandably, the Treasury press release has an optimistic tone, arguing “the primary goal for sanctions is behavioral change; the people and entities delisted today credibly showed that they have stopped engaging in sanctionable activities.” On the other hand, a Semana commentary is more ironic, stating that the “paradox” of the end of the Cali Cartel is that while Miguel and Gilberto Rodriguez Orejuela, along with five of their children, are now in prison, the enterprises that were founded with drug-money and utilized for criminal ventures “are now in ‘liberty.’”
Ultimately, the legacy of the apparently defunct cartel will be one of violence. A December 2013 report in El Pais discusses the scars that that city of Cali still has to live with due to the cartel wars in the 1980s and 1990s. Namely, the article mentions the explosion of a car bomb in Cali on May 13, 1990, allegedly carried out by the Medellin Cartel during its turf war with the Cali Cartel. The attack killed nine and injury 45 people.
It is debatable to what extent OFAC is correct in removing those 308 names from its list of sanctioned entities and persons, particularly as the Colombian media hints that they profited from drug-money. We will have to trust that the OFAC’s sources are reliable and those involved are no longer associated with illicit activities. Stranger things have happened.

Sunday, June 22, 2014

Quoted in: From Mexico to Brazil, climate change threatens coffee growers in Latin America

"From Mexico to Brazil, climate change threatens coffee growers in Latin America"
By: Diego Cupolo
June 3, 2014

Coffee, like gold, sugar and oil, has long been one of Latin America’s major exports, sustaining everyone from independent farmers in mountain regions to corporate bankers in capital cities, all while keeping weary minds alert throughout the world.

Yet over the last decade, changing climate patterns have intensified droughts and plagues in the region, creating conditions less suitable for coffee production and wreaking havoc on the industry that came to define, even shape, many hillsides in rural Central and South America. Today, as coffee growers struggle to recover from a string of weather-related events, some industry analysts have already foreseen a major shift in coffee production towards Asia and away from Latin America.

The long series of problems came to a peak this spring, when coffee prices doubled after a severe drought stunted the growing season in Brazil, the world’s top coffee exporter. The extent of the damage remains unknown, but the price hike arrived at the same time that many other Latin American nations underwent a record-breaking epidemic of coffee rust, or “roya” in Spanish, a fungus known to suffocate coffee trees and lower bean yields.

The rust outbreak began in 2012 and has since affected nations spanning from Mexico to Peru, with countries in Central America experiencing the highest levels of crop loss, said Monika Firl, social projects manager at Cooperative Coffees, a Montreal-based sourcing co-op that imports specialty coffee.

“In Nicaragua in particular, farmer groups have been really hit hard,” Firl said. “Some groups that we are working with might have 20 percent of their total harvest. There are other farmers we are working with in El Salvador that will have 5 or 10 percent of their usual harvest, so for a farmer that’s already living on the edge, this is disastrous.”

The outbreak is just one of three major epidemics to hit Latin American coffee growers in the last six years. There was also a coffee rust outbreak in Colombia from 2008-2011, where nearly a third of the nation’s harvest was lost to the fungus. Along with this year’s drought in Brazil, the three events were caused by erratic climate patterns, said Peter Baker a senior scientist specializing in commodities and climate change at the Centre for Agricultural Bioscience International.

“It’s difficult to point the finger directly and say it’s because of climate change, but it’s consistent with more chaotic weather patterns which I think we’re seeing globally,” Baker said during a phone interview in May 2014.

Aside from higher prices and lower quality brews for consumers worldwide, the wave of agricultural catastrophes threatens the economic foundation of coffee growing nations in Latin America, where total coffee production has dropped about 20 percent since 2011, an estimated loss of more than $1 billion. In Central America alone, about 5 million people get their livelihood, directly or indirectly, from the coffee and their future remains uncertain.

The latest report from the Intergovernmental Panel on Climate Change (IPCC) states “the suitability for coffee crops in Costa Rica, Nicaragua and El Salvador will be reduced by 40 percent” with increasing of temperatures. Regarding Brazil, the report says warmer summers could make coffee crop unfeasible in Minas Gerais and São Paulo, the nation’s major coffee growing states.

Meanwhile, countries like Vietnam, Indonesia and China are stepping up their coffee production to fill global demand as many Latin American coffee growers face a 2-3 year recovery period before they can return to pre-plague harvest figures. Baker said mitigation efforts are often slowed and complicated by their costs, as they require significant investments and adaptations, which most independent farmers cannot afford without government assistance.

If current trends continue, rural areas from Mexico to Brazil, many of which are already afflicted with poverty and malnutrition, are bound to experience higher unemployment rates, increasing hunger and, eventually, mass migration.

“If the problem persists, employment and stability in the region could be compromised,” Mark Feierstein, administrator of the United States Agency for International Development (USAID), told the International Business Times. “It could affect migration patterns and prompt an increase of immigration to the U.S.”

Deep Roots of a Plague
While speaking of the many causes behind the current rust outbreak, W. Alejandro Sanchez, a senior research fellow at the Council on Hemispheric Affairs (COHA), pointed out the fragility of commodity-based economies in Latin America.

“Countries like Peru, Mexico and Colombia are regarded as the ‘pumas of Latin America’ just like the tiger economies in Asia,” Sanchez said. “As much as some of our economies are thriving, we are still economies based on basic commodities: oil, gas, lithium, potatoes, rice, beans and coffee. That means we are at the mercy of the environment.”

From the environment to farming practices, the recent outbreaks were created by a myriad of conditions, which scientists are still trying to define. While there hasn’t been conclusive research on the subject, the main causes for rust seem to correlate with rising heat and humidity.

“Warming temperatures at higher altitudes and the resulting shifts in moisture accumulation are likely allowing the rust to thrive in areas previously uninhabitable,” wrote Emma Bladyka, coffee science manager for the Specialty Coffee Association of America (SCAA). “Disruptions in the typical dry season can create an environment more habitable for rust outbreaks. Smaller and more frequent rainfall in the region likely contributed to the perfect fungal habitat.”

Many other factors are also exacerbating the rust outbreak, including land use methods, degradation of soil quality, use and misuse of fertilizers or fungicides and a general shift towards high-density monoculture farming that allows easier disease transmission between plants.

“Roya is a fungus that is always present in coffee,” said Firl of Cooperative Coffees. “When the fields become out of balance or the trees become very vulnerable and climatic spore infestations occur, that’s when you get this epidemic proportion. Once it starts multiplying, it just takes over.”

In Colombia and Guatemala, governments have responded by assisting farmers in planting rust-resistant varieties of coffee, which have proven effective in some short-term case studies, but are not popular among specialty roasters who claim engineered coffees have inferior cup quality.

The US government has also announced a $5 million partnership with Texas A&M University’s World Coffee Research center to create stronger strains of coffee that will fight off future pests and plagues. Yet due to fast evolving and fluid outbreaks, “the science is always three years behind,” Firl said. There are many varieties of coffee rust along with other coffee diseases and researchers often struggle to make hybrids resistant to multiple conditions.

“Clever as we think we are, the natural cycles are much quicker” Firl said. “The insects, the illnesses, the plagues become much more resilient and then you’re back at the laboratory, trying to come up with a more resistant new breed [of coffee] to combat the now more resistant strands of fungus. So it’s great for the labs, but it’s not good for farmers.”

The Orphan Commodity

Fungicides, insecticides, fertilizers and even pruning equipment all require significant investment. Even if governments were to provide subsidies to coffee farmers for such products, large-scale education programs would be needed to teach growers about rust-prevention techniques and planting methods, Baker said.

Fighting region-wide epidemics requires massive, multi-national campaign efforts, which can be difficult to organize due to the fact that coffee is an “orphan commodity,” or a crop without a global institution to direct and oversee development trends.

“Unlike the CIMMYT international corn and wheat center in Mexico or the IRRI rice center in the Philippines, there is no equivalent organization for coffee,” Baker said.
Few crops are in the world are grown like coffee. The results create not only a decentralized, country-by-country response to disaster relief, but also a global deficit in research and development on coffee production. Speaking at the Let’s Talk About Roya conference in El Salvador last fall, Baker said worldwide investment in R&D for coffee totaled about $100 million per year.

“The full value of the coffee industry is a $100 billion a year, so [research and development is] 0.1 or 0.2 percent the total value spent on production and that’s crazy,” Baker said. “It’s completely crazy. Expenditure is completely inconsistent with the risk levels.”

Normally, Baker said industries spend between 2 and 10 percent of their total production value on R&D. He also pointed out the research conducted on coffee is more often focused on its health effects for consumers than on improving growing conditions in the fields.

For these reasons, even the root causes of coffee rust remain unclear to many scientists studying the epidemic. To obscure matters further, there are no official figures on how many crops are lost to disease or how much land is used to grow coffee worldwide. All we know is how much coffee reaches the market, Baker said, a method of commerce that disregards the supply chain and strictly values the end product.

“Instead of developing technology to continue on the same footprint, globally the coffee industry continues, I think, to be a deeply exploitive and extractive industry,” Baker said at the conference. “It moves on, it burns out land, moves on to other areas.”
Other areas like Vietnam, Indonesia, Laos, Myanmar and China where much of the rising coffee production is driving deforestation. While sustainable and fair-trade coffee certifications have made significant impacts on the industry over the last decade, Baker said they haven’t done enough to curb destructive land use practices.

"That’s a principle problem, that you have a lot of new coffee coming onto the market every year and most of that, I think, is coming from deforestation so this is something the coffee industry doesn’t really want to talk about, but it’s happening,” Baker said, citing studies by David Gaveau of the Center for International Forestry Research, that link coffee price fluctuations to deforestation rates in Sumatra.

The globalized production of coffee has kept crop prices relatively stable. New exports from Asia replace crop losses in Latin America and, until recently, consumers have remained unaffected.
“What the last years have told us is we lose millions of sacks of coffees because of rust and yet the price goes down,” Baker said. “So roya is a sort of earthquake that reminds us that we’re sitting on top of a fault and the fault is that the global market doesn’t work for agriculture in general.”

Adding to the long list of sustainability problems, Baker said coffee production has become dangerously concentrated over the years, with just four countries exporting 2/3 of the world supply. If one nation undergoes a climate-related event and production is affected, such as the drought in Brazil, the impact that single event can be amplified through the industry worldwide.

“Increasingly, in the future, I think we’re going to get more climate shocks and it will be like playing one of those [slot] machines,” Baker said. “One year, two or three climate shocks will come up together and we’ll have a real shortage of coffee.“

“Locally, on the farm level you’ve got some really nicely run farms, on a micro-level, but globally I think coffee is actually becoming less sustainable,” Baker continued. “I think its carbon footprint must be going up, biodiversity is going down and you’re getting this concentration [of production] and it’s risky to have all your eggs in a few baskets.”

The Future in the Past
In 1870, Sri Lanka was the largest coffee producer in the world. At the time, it was a British colony known as Ceylon and the small island supplied Europe with much of its coffee until the first signs of a rust outbreak appeared in 1875. The fungus spread quickly and the colonizers failed to slow infection rates, resulting in the loss of 95 percent of the coffee harvest in less than 20 years.

With a once thriving industry decimated, local coffee growers began planting tea. Today, many argue the Ceylon coffee rust outbreak of 1875 is the primary reason behind the British addiction to tea. They were forced to adapt to new circumstances.
It’s too early to tell whether the same fate awaits Central and South America, but the prospects are worrisome, Firl said.

“The position rust puts farmers in is so challenging,” Firl said. “Most of the support going out to farmers, I feel, is misguided. It’s pushing them towards chemical solutions, it’s a lot of talk and a lot of showcasing, grandstanding new policies, grandiose summits and very little is going to farmers to help them get through what’s a very horrific plague.”
Most efforts to combat the outbreak have been centered on developing new fungicides and fungus-resistant coffee trees, Firl said. Yet these remedies have proven to be problematic in Honduras, where 50 percent of coffee plants were rust-resistant varieties and the nation still suffered a 28 percent loss of coffee yields during the most recent outbreak.
Firl said chemicals and laboratory solutions alone cannot stop the spread of rust. Organic fertilizers, soil quality and field management are all important components in combating the plague.

“In Marcala, Honduras, we have one organic farmer who is using different kinds of compost, frequent applications, spraying, cultivating micro-organisms that are natural inoculants, adding that back into coffee fields, spraying the soil and spraying the foliage,” Firl said. “He’s doing all of that and this guy is getting 50 quintales of good quality, organic coffee while his neighbors will have scattered berries on their bushes.”

Image: Coffee fields in Costa Rica (Diego Cupolo).
“It takes a lot of work and investment,” Firl continued. “He was already doing this before the plague. Out of conviction, not reaction. He had the resources available that a lot of farmers don’t, to hire extra hands, to do the pruning and the composting, but not all coffee farmers are in that luxurious position of having profits [from their harvests.]”

In response to the Ceylon rust outbreak, growers in Southeast Asia and Africa also replaced much of their Arabica coffee trees, the rich-flavored variety preferred by specialty brewers, with the more bland, but more resilient Robusta coffee trees. Today, Latin America still produces most of the world’s Arabica coffee beans, but if the problems persist more coffee growers are bound switch to Robusta, Baker said.

“Big coffee roasters, in their standard supermarket blends are putting in a bit more Robusta so, yes, the taste and quality, I think, will tend to slip,” Baker said. “Whereas twenty years ago, 30 percent of coffee worldwide was Robusta, now it’s up to about 40 percent and I think that’s going to carry on.”

Taste aside, larger coffee distributors will adapt to changing climate patterns by finding substitute suppliers, Firl said. Global demand for coffee is rising and consumers will likely remain largely unaffected as the production landscape is rearranged throughout the world.
“A year ago, roya was in the news for two or three weeks, and my theory is that once the industry recognized that supply wouldn’t be effected, that they’d just have to move production elsewhere, the issue just completely dropped of the map,” Firl said.

“For us, it’s a little more difficult because we have a really long term relationship with a lot of coffee-growing organizations and we want them to be there three years in, once they recover from [coffee rust], so we’re looking for different ways around this, as we speak,” she continued. “The growers in El Salvador, for example, we won’t be buying coffee from them in the next two years and I keep asking them ‘What are you going to do?’ The only concrete response I’ve heard so far is ‘plant corn.’”

From infrastructure to popular culture, coffee has shaped much of Latin America’s identity. Its importance is hard to overstate as we are constantly reminded of its status by songs like Juan Luis Guerra’s “Ojalá que llueva café” or “Let us hope it rains coffee.”
In times when there have been few alternatives, coffee has sustained families in rural regions throughout Latin America. The present epidemics have dealt significant blows to coffee growers in the region. While some farmers will continue to thrive, others may not, but all will be forced to adapt in the face of global climate change.

Diego Cupolo is an independent journalist, photographer and author of Seven Syrians: War Accounts From Syrian Refugeesreleased January, 2014, by 8th House Publishing. He serves as Latin America regional editor for Global South Development Magazine. See more of his work at