From Volume 7, Issue 18 of EIR Online, Published Apr. 29, 2008

Ibero-American News Digest

Bank of the South Back on the Agenda

April 23 (EIRNS)—Discussions between Ecuador's President Rafael Correa and Argentina's President Cristina Fernández de Kirchner, during the latter's 24-hour visit to Quito on April 21, mark the first high-level discussion of the Bank of the South and transcontinental integration since the British blew up the political alignment of the continent, using their FARC narcoterrorist asset, immediately after the Bank of the South was founded on Dec. 9, 2007, at Fernández de Kirchner's inauguration.

The two Presidents reported nothing from their 40-minute private meeting, but their remarks at various public events centered on the imperative for regional integration, to solidify the break with globalization's "neoliberalism." Correa centered his official speech for the visit on the urgency of creating a "new financial architecture" around the Bank of the South, to permit sovereign development, unbeholden to "crumbs from what is euphemistically called international capital."

Reference was made by both Presidents, to the need for common action in the face of the world food crisis, although details on this aspect are not yet available.

The occasion for the state visit was the launching of work on the long-planned Coca Codo Sinclair dam, which, when completed, will be the largest hydroelectric project in Ecuador. Argentina will provide 30% of the financing in this joint venture between Argentina's state company Enarsa, and Ecuador's state-run Termopichincha. Fernández hailed the project as exemplary of the concrete actions that must be taken in order to advance the process of integration.

Among the other projects discussed and/or signed during the visit, were the modernization of Ecuador's railroads and waterways, and the recently concluded Argentine-Ecuadorian study on the navigability of Ecuador's Napo River, and its potential to provide transcontinental transport between Manta, Ecuador, on the Pacific, and Brazil's Manaus port on the Amazon River, which provides access to the Atlantic.

Ibero-American Leaders Urge Emergency Action on Famine

April 24 (EIRNS)—As details emerge about the desperate food crisis in Central America, where famine is about to become a reality, Ibero-American Presidents are meeting on an emergency basis, to forge a common strategy to address the region's need for greater quantities of cheap food.

In an April 23 interview with Venezuelan TV, Ecuadorian President Rafael Correa announced that he has discussed this issue with Argentine President Cristina Fernández and also with Venezuelan Foreign Minister Nicolás Maduro. "The key is to have adequate control of the inventory to address the region's food shortage," Correa said, "because we fear that we're facing a world food crisis."

On the same day, Venezuelan President Hugo Chávez met in Caracas with leaders from Cuba, Bolivia, and Nicaragua—all members of the Bolivarian Alternative for Latin America (ALBA)—to set up a $100 million program to combat rising food prices, as well as to create agro-industrial programs to produce grains, beef, and milk.

The crisis in Central America is dire, with famine threatened in several nations whose food-producing capabilities have been decimated by years of globalization and free trade. The case of Guatemala, a country targetted for big biofuels production today, is exemplary. Ten years ago, it was self-sufficient in food production. But over time, this capability was replaced by huge projects to produce sugar cane and African palm oil for export, which had no need for the rural labor force, which subsequently migrated to the cities to live in slums. Sugar-cane production increased by 99% between 1990 and 2005, while production of beans, corn, and wheat—staples in Guatemala's diet—declined dramatically during the same time frame: beans by 26%, corn by 22%, and wheat by 99%!

Today, one-half of Central America's malnourished population—3 million people—are Guatemalan, the majority of whom are children under the age of five. This pattern is repeated throughout the region.

Central American agriculture ministers are scheduled to meet in emergency session on April 25 in Panama, and again in Managua on April 26, where they will present details of the dire regional situation to representatives of the ALBA. The agenda for both meetings is focussed on increasing production of basic grains, and creating "new financial instruments" to pay for this. According to Nicaragua's agriculture minister, all agree that increased food production must be marketed, at fair prices, first to the countries in the region.

Central American heads-of-state will then meet on May 7, possibly with Presidents of ALBA countries, to announce specific proposals.

Argentine Finance Minister Ousted for Pushing IMF Policy

April 25 (EIRNS)—Argentina's Finance Minister, Martín Lousteau, resigned yesterday, after it became clear that President Cristina Fernández de Kirchner had no intention of accepting his proposals to "cool off" the economy, as recommended by the International Monetary Fund. Upon returning from the IMF/World Bank meeting in Washington two weeks ago, Lousteau proposed that the President adopt standard IMF prescriptions to "fight inflation" by raising utility rates, restricting public spending, and improving the "investment climate" to attract foreign investors.

Lousteau hadn't received any official reply to his recommendations, as of yesterday. But the rousing afternoon speech by former President Néstor Kirchner, in his capacity as the new president of the Justicialista (Peronist) Party, made clear what Lousteau could expect, and he handed in his resignation later that evening. His replacement is Carlos Fernández, former head of the Federal Public Revenue Administration (AFIP), who is considered to be an experienced and "tested" official trusted by the current and former Presidents.

In his speech, Néstor Kirchner attacked those "economists who want to cool off the economy, so that we don't consume, and everything is exported abroad." Remember the situation in 2003, he warned, when the country was "under assault by the IMF." The policies that led to frozen bank accounts and speculative schemes will not be imposed on the country again, he said.

The former President went further, attacking as coup-plotters the leaders of the 21-day agricultural producers' strike that occurred in March. In a reference to the British-loving oligarchs of the Rural Society which led the strike, Kirchner charged that there is a "historical continuity" between those who organized the coups of 1955 (which overthrew Juan Perón), and 1976 (which overthrew Isabel Perón), and the leaders of last month's strike.

"It's always the same people," he said. "They don't care about the stomachs or pocketbooks of Argentines." They blocked the roads, and "food prices rose due to scarcity ... [they sought] to destroy the internal market and consumption.... They want to export everything, taking advantage of the high prices in the international market."

The Malthusians of the Rural Society think the ideal size of Argentina's population is one man to every four cows. "They think that there are only 300,000 or 400,000 people in Argentina," Kirchner said. But they should know that we are 40 million Argentines who want to live, and have the possibility of living." He made clear he would lead "the thousands, the millions of Argentines to support our President with all our strength."

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