From Volume 4, Issue Number 28 of EIR Online, Published July 12, 2005

Ibero-American News Digest

LaRouche's Historic June 16 Speech on Dominican Television

Nearly the entirety of Lyndon LaRouche's opening remarks from his June 16 international webcast were broadcast on the TV program "Cara a Cara" (Face to Face), on cable television's Channel 10, a nationwide cable station in the Dominican Republic—once on July 2, twice on the 3rd, with a final airing on July 5. To maximize viewership of the show, Telecable took out an ad in the July 2 edition of the daily Hoy, which listed the times of all the broadcasts, included a picture of LaRouche, and announced: "Attention. A 'Cara a Cara' Extra. LaRouche Speaks: Globalization Fails. He Says that the World Is Endangered by the Policies of George Bush."

Drive To Privatize Mexico's PEMEX Wins a Round

On June 28, the Mexican Chamber of Deputies voted 330-131 to progressively reduce the amount of oil revenues which the state oil company, Pemex, passes on to the Federal government in the form of taxes—purportedly to increase funds available to Pemex for "investment." This has been a longstanding goal of the international financial community, which would:

1) dramatically cut government income (since about 40% of the budget today comes from oil revenues), and thereby force the government to impose parallel drastic cuts in spending;

2) create an income stream for Pemex, not for "investment" or technological upgrading, but to directly service old debt and new, which the bankers intend to pile on Pemex. In fact, there is already discussion of Pemex issuing new bonds, which would be linked to these new revenues.

This is all a foot-in-the-door for the privatization of Pemex, which is otherwise explicitly outlawed by the Mexican Constitution. As the scuzzy director of Pemex, Luis Ramirez Corso, told the press happily after the Congressional vote: "A good step was taken in Congress for Pemex, but we have to recognize that it is a transitional regime that, in the future, will allow us to achieve management autonomy and a corporative government."

Cardenas Withdraws Bid for PRD Presidential Candidacy

In a July 5 open letter, Democratic Revolutionary Party (PRD) founder and three-time Presidential candidate Cuauhtemoc Cardenas announced that he would not compete against Mexico City Mayor Andres Manuel Lopez Obrador for nomination as the PRD's candidate in the 2006 Presidential elections. Without ever mentioning Lopez Obrador by name, Cardenas attacked the "lack of debate" on policy issues within the PRD, and its "ideologically contradictory electoral alliances."

A week earlier, in a private meeting with 60 top politicians, government officials, and intellectuals, Cardenas had sharply attacked Lopez Obrador, this time by name. "We have totally different visions of how to lead the country," he said, criticizing Lopez Obrador for offering handouts to the poor, rather than investment and job creation to eliminate poverty; for proposing to "isolate" Mexico from the world; and for seeking to strengthen the Executive Branch, "rather than democratizing" and setting up a semi-parliamentary system. Significantly, Cardenas also attacked Lopez Obrador's longstanding alliance with Manuel Camacho Solis, an asset of speculator George Soros.

Cardenas has not, by any means, ruled out running for the Presidency as a fourth candidate against those of the PAN (expected to be Santiago Creel), the PRI (most likely, Roberto Madrazo), and the PRD (Lopez Obrador). But for the moment he is only stating that he is building a "fourth option" for the country, which "transcends parties," and which will focus on the program needed to build "a Mexico for all."

Argentines in No Rush To Negotiate with IMF

"If, in a country where 40% of the population is poor, we direct all of our surplus to debt payment, we'll delay the infrastructure projects we need to keep growing, and meeting the population's needs will be more difficult," said Argentine Chief of Staff Alberto Fernandez. He was speaking in response to the IMF's imperious demand, in its latest "Article IV" review of the country's economy, that the Kirchner government impose deeper austerity. It is "irrational," he said, to demand a primary budget surplus of 4.5% of GDP. Argentina needs to move forward with development, and not postpone the "multiple needs" it has to guarantee that development.

Finance Minister Roberto Lavagna told a radio audience on June 27 that Argentina is in no hurry to sign an agreement with the IMF, and that the Fund's defense of the bondholder "hold-outs" (who didn't join the restructuring) is "inexplicable." The markets "have spoken; [the Fund] should at least keep quiet and not obstruct Argentina's debt restructuring process," he said.

Petrocaribe Formed by Venezuela's Chavez

Venezuela's President Hugo Chavez organized a summit of 16 Caribbean nations on June 28-30, to present heads of state and government representatives with his proposal to help those nations with their oil bills. Fourteen of the 16 nations signed only with "qualifications," and Trinidad y Tobago and Barbados abstained. The reason was that Cuba's Fidel Castro made a last-minute appearance, in spite of the Venezuelan government's assurances that he was unlikely to be there.

Petrocaribe is meant to expand into the Caribbean nations the existing agreement under which Venezuela helps finance the oil bills of the Central American nations. It would also upgrade the agreement into the form of a state company, Petrocaribe, as part of Petrosur and other plans for energy integration in the region. The agreement gives those buyers of Venezuelan oil larger breaks on payments schedules when the price rises to over $50 a barrel, and allows them to pay "in kind" with "goods and services" from their countries—as Cuba is doing already, with doctors, teachers, and sports trainers working in Venezuela on Cuban pay, in exchange for the oil. Venezuela has similar barter agreements with Argentina and Uruguay.

Chavez had originally conceived of the gathering as a next-day continuation of his planned meeting with Brazil's President Lula da Silva and Argentina's Nestor Kirchner, scheduled for June 27. But that summit was cancelled after Lula announced he could not go because of the political turmoil within Brazil. Chavez planned to officially make a big stance with Petrosur, and then connect it to Petrocaribe.

Ecuador Looking to China for Trade and Aid

Ecuador's government is discussing oil deals and financial aid with China, Finance Minister Rafael Correa told the Financial Times of June 29. President Alfredo Palacio had been engaged in discussions with China even prior to becoming head of state, Correa reported, and sought long-term oil sales contracts as well as investment in two multimillion-dollar oil refinery projects. Warning that banks associated with ousted President Lucio Gutierrez may refuse to roll over government bonds, Correa said the government is seeking alternate sources of financing from "friendly" nations, such as China, Brazil, and Venezuela.

Ecuador Protests U.S. Financial Warfare Threats

In a speech to the nation June 22, Ecuadoran President Alfredo Palacio warned the U.S. to back off its threats of financial warfare against Ecuador. In response to a U.S. Embassy spokesman's threat that U.S. financial aid to Ecuador will depend on U.S. military personnel there being granted immunity from prosecution before the International Criminal Court, Palacio responded: "Absolutely no one is going to make me afraid. This is a question of sovereignty, of juridical control. The United States has the right to make legal statements, and we are going to respect them, but Ecuador too has the right to assert its legal foundations and to be respected."

The Ecuadoran government is also sticking to its guns on its "people first" policy on the debt. On June 24, the IMF issued a statement expressing "certain concerns" regarding the Ecuadoran government's new Law of Fiscal Responsibility, which dramatically reduced the portion of oil profits previously allocated for debt buyback, redistributing it instead to education and health needs. IMF spokesman Thomas Dawson expressed "concern" that Ecuador might not be able to pay its debt, and promised imperially that the country's use of its oil income "would be reviewed" in the IMF's next quarterly review of the Ecuadoran economy. Economic Under Secretary Luis Rosero Mallea responded with an official statement declaring that "Ecuador wants to meet its international obligations, but in a way that is not onerous for the country." Ecuador is asking the Club of Paris to forgive a "substantial portion" of the country's foreign debt, which it is unable to pay, and to renegotiate the rest.

Chile Turns to Russia for Nuclear Power

The Chilean and Russian governments have signed an agreement to cooperate on the non-military use of nuclear power. The agreement was signed during a meeting of the Russian-Chilean intergovernmental commission on Trade and Economic Cooperation in Moscow at the end of June, attended by Chile's Mining and Energy Minister Alfonso Dulanto, and Alexander Rumyantsev of Russia's Federal Atomic Energy Agency. Chile does not currently have a nuclear plant, but Rumyantsev told reporters that it is considering the possibility of building one, and is interested in working with Russian experts on such a project. Earlier this year, President Ricardo Lagos said that Chile will have to consider the use of nuclear energy, among other sources, to resolve its serious energy crisis.

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