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Facing an Unprecedented Migration Crisis in Latin America and the Caribbean

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The Simón Bolívar International Bridge linking Venezuela and Colombia has long ceased to be a mere bridge. For months, the thousands who cross this bridge daily have transformed it into a symbol of the Venezuelan exodus. Many kilometers to the north of the Latin American region, human caravans from Central America’s Northern Triangle once again placed the spotlight on another longstanding migration issue.

Although they come from different places, those embarking on these journeys face the same situation—they are leaving their homes because of a lack of opportunities, violence, or even food shortages. Occurring at a hitherto unseen speed and magnitude, this phenomenon has created an unprecedented migration crisis for Latin America and the Caribbean. What are the characteristics of each?

Migration from Venezuela involves one of the biggest and most rapid flows of vulnerable persons globally. According to the United Nations Refugee Agency (UNHCR), as of February 2019, the country’s economic and social crisis had led to the exodus of 3.4 million persons. Most have left in the past 12 months and have gone to Colombia, Peru, Ecuador and Chile, the main receiving countries. The magnitude of this crisis makes it the second biggest globally after the Syrian crisis.

The movement of persons from the Northern Triangle to the United States has been taking place for a much longer time. Between 1980 and 2015, the number of migrants from this subregion who were living in the United States increased by an annual average of 8 percent and in 2017, their total number in the United States stood at close to 3 million. Most persons leave because of the shortage of good jobs, high rates of crime and violence, and the desire to be reunited with their families. Remittances to Honduras, Guatemala, and El Salvador, which amounted to almost US$20 billion in 2017, have become one of the main pillars of their economies, accounting for nearly 15 percent of their combined GDPs.

With the movement of persons come challenges and opportunities for both the source and destination areas, as I mentioned last week at the conference “Migration and Cities. The Path to Inclusive Integration,” held in Madrid.

According to a World Bank report published last November, the cost of additional education, health, water, early childhood, humanitarian, employment, and institution building services resulting from migration from Venezuela is estimated at between 0.2 percent and 0.4 percent of Colombia’s GDP, a figure that will certainly increase given the growing number of persons leaving Venezuela. Despite this, the countries of Latin America and the Caribbean have opened their doors to migrants in a gesture of solidarity commensurate with the magnitude of the crisis. In terms of opportunities, migration can create economic growth when it is well managed.

As happens in other regions, Northern Triangle migration breaks family and community ties and disrupts the support networks in the originating countries. It can, however, contribute to poverty reduction, human capital improvement, and greater investment as a result of the transfer of remittances. El Salvador provides the most compelling evidence of this, where it is estimated that in 2014 the poverty rate would have been 12 percent higher without those remittances. Another analysis conducted in Guatemala using data from that same year demonstrated that the likelihood that a family would face food insecurity decreases by 40 percent when it receives remittances.

At the World Bank, we are supporting the region using the experience gained in other areas of the world such as the Horn of Africa or the Middle East.  We are assisting Colombia by analyzing the effects of migration and short- and medium-term response strategies. Similar studies involving Peru and Ecuador are also being carried out. In addition, we recently announced Colombia’s eligibility for funding from the Global Concessional Financing Facility, a platform that supports countries hosting large numbers of refugees. Furthermore, the refugee issue will be one of the main topics discussed at the upcoming Spring Meetings of the World Bank and International Monetary Fund, to take place in less than three weeks. Going forward, we will continue our commitment by providing technical and financial assistance to migrant-receiving countries.

In the Northern Triangle, we are helping to improve access to health and education, boost the competitiveness and productivity of small producers, and enhance food security in areas impacted by drought and climate change such as the Dry Corridor, while at the same time assisting with crime and violence prevention and conducting analyses of key issues such as job creation. The aim of all these activities is to provide persons seeking a brighter future with options other than fleeing to another country.

Our efforts complement the work being done by other development organizations, governments, and civil society, although they will have to be redoubled given the projected continuation of these migration flows. The only way we will be able to tackle what is likely the greatest humanitarian crisis facing Latin America and the Caribbean today is through commitment and genuine solidarity with persons facing the dual vulnerabilities of poverty and migration.

World Bank

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Americas

Leftists make a comeback in Latin America

Mohammad Ghaderi

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In Argentina and Uruguay, leftist candidates won the elections and Evo Morales could maintain his position as the president of Bolivia, but in Chile, people have protested against the U.S.-backed president.

The failure of the U.S.-backed candidate in the Argentinean election in recent days was a sign of the U.S. failure in Latin America. Leftist Alberto Fernandez, an opponent of U.S. interventionist policies, won about 48 percent of the vote in general election and was announced as the new president in the first round.

 This is while countries such as Venezuela and Cuba have maintained their anti-U.S. sentiment. Although the U.S. has made an unceasing effort in the last two years to overthrow the current regime in Venezuela, it has not succeeded. 

The New Left movement in Latin America, which was formed by the late Venezuelan president Hugo Chaves, has put Venezuela in many troubles but reduced U.S. influence in the region to the point that even experts suggested that Washington has lost its backyard.

The New Leftist governments emerged in Latin America in the late 20th century. Leftist leaders have distanced from some of traditional principles, but maintained the fight against American hegemony, just like their predecessors. Latin America, with rich sources of oil, gas, and uranium, as well as great opportunity for investment, has been of particular importance from a geopolitical, geostrategic and geo-economic perspective. The U.S. has put control over Latin America on its agenda since 1823 when then president James Monroe offered his plan known as the “Monroe Doctrine”.

The Monroe Doctrine emphasized that as long as the U.S. had not achieved real power and growth, it cannot be considered as an active element and main actor in world politics, thus it should obtain necessary economic growth in Western Hemisphere. The doctrine also stated that South America and Caribbean are areas with high security priority whose fate is tied to the U.S. fate, and the U.S. must have a strong influence in the region to provide its own growth and development.

In the late 20th and early present century, Latin America has witnessed new developments, including the New Left movement. The New Left in Latin America was founded and developed as leaders such as Chavez in Venezuela, Luiz Inacio Lula da Silva in Brazil, Evo Morales in Bolivia, Rafael Correa in Ecuador, and Daniel Ortega in Nicaragua came to power.

 Opportunities and threats

The U.S. is concerned about the presence of its rivals, especially Russia and China, in Latin America and the cooperation of these two countries with leftist states in the region. To counter China and Russia’s influence, the U.S. has launched various plans to undermine leftist governments through economic crises and put its allied right-wing figures into power.

Washington’s comprehensive effort to topple the Maduro administration in Venezuela is an example. On the other hand, China and Russia’s approach to Latin America and the tendency of New Left countries to ally with Beijing and Moscow can be a major deterrent to the implementation of the U.S. plan in the region.

This is while the Trump administration is trying to redefine U.S. role and position in Latin America. From Trump’s point of view, the wrong policies of previous governments and developments have caused the U.S. to lose its control over Latin America and the Caribbean, and instead increased the influence of U.S. rivals, including China, in the region.

In an interview with Foreign Policy, following his recent visit to Colombia, Air Force Chief of Staff General David Goldfein said that the Trump administration is making a push to strengthen alliances across Latin America as part of an effort to counter rising Chinese and Russian influence in the United States’ backyard.

Goldfein said Colombia and other Latin American countries risked being locked out of U.S. and allied operations if they stopped buying military hardware from the United States and turned to other markets instead.

China has invested heavily in the region to reach Latin America’s oil reserves. Beijing has now become the largest trading partner of some Latin American countries, including Brazil, Chile, Cuba and Uruguay.

Russia also continues to sell billions of dollars in arms to Latin American countries. Unlike China, which seeks to use Latin American natural resources for its economic growth, Russia’s interests in this region are more strategic.

From our partner Tehran Times

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Americas

Democrats take a gamble on Trump’s impeachment

Javad Heirannia

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Despite all ups and downs, Democrats finally brought impeachment inquiry into President Donald Trump to the House of Representatives, a move which made Trump’s prediction come true.

The House of Representatives passed a resolution on Thursday to launch an impeachment inquiry into Trump, thereby making formal investigations against him possible. The resolution was approved by a vote of 232 to 196.

Accordingly, the House of Intelligence Committee carries out the investigations into the impeachment and reports its findings to the Judiciary Committee that comments on the process of impeachment.

Trump has said that the House will get enough votes to impeach him, but he is certain that the Senate will acquit him of charges.

Investigations into Trump’s impeachment began on September 24 following the official order of Speaker of U.S. House of Representatives Nancy Pelosi.

The order came after reports about Trump’s telephone call with Ukrainian president for investigation into his possible rival Joe Biden.

During the conversation Trump asked his Ukrainian counterpart Volodymyr Zelensky for a “favor”. He pressured Zelensky to investigate Joe Biden, his possible Democratic rival for the 2020 presidential election, and his son Hunter Biden who was on the board of a Ukrainian oil and gas factory.  At the time, Trump had suspended $400 million military aid to Ukraine as a quid pro quo.

Why Nancy Pelosi risks?

It should be noted that some Democrats have called for Trump’s impeachment since his first months of his presidency. The impeachment inquiry was popular among Democratic voters, with a recent poll showing that %73 of them favoring the impeachment.

But Republicans are strongly opposed to impeachment, and the country generally relies on Republicans. That is why Nancy Pelosi and other leading Democrats were first reluctant to officially begin an impeachment. Their calculations have so far revealed that impeachment against Trump will not have much effect on the opinion of Republicans and his supporters, a situation which will make it more difficult to remove him from the 2020 election.

Trump has described the impeachment as “fake”.  Pelosi said that Trump has affirmed that he had asked the Ukrainian president to take actions in favor of his political position, claiming the measures of Trump’s administration were undermining U.S. national security.

“The release of the notes of the call by the White House confirms that the president engaged in behavior that undermines the integrity of our elections, the dignity of the office he holds and our national security,” Pelosi said in a statement.

House Intelligence Committee Chairman Adam Schiff also said that the president should prioritize national interests rather than his personal interests. Schiff added that they will study whether Trump has exploited military aid to Ukraine to meet his demands. 

Consequences of Trump’s impeachment

Experts argue that Trump’s impeachment and lack of a decisive leader will make the U.S. more vulnerable to other countries’ plots. As Robert W. Merry recently said in The National Interest magazine, “When the president is weakened at home, then America is weakened abroad.”

However, Washington’s friends and enemies consider U.S. foreign policy insignificant due to political infighting at home. Instead, the great power players are seeking to limit the influence of the country rather than cooperating with it.

The recent accusations against Trump can be easily stated as a national security issue, which needs to be reformed immediately. Theoretically, military aid will be provided only if U.S. officials become convinced that they can achieve main security objectives of Washington. Therefore refusing to provide aid because of political reasons is a serious wrongdoing, showing that the personal interests of the president is superior to U.S. national interests. 

Will the impeachment inquiry get the necessary vote?

Now that the House has launched an impeachment inquiry into the president, the Senate will play an important role in the process. In this case, the Senate will act as a court that decides on Trump’s dismissal or survival.

To oust Trump, the votes of 67 members of the Senate is needed, which would be two-thirds of their population. Currently, there are 53 Republicans and 47 Democrats in the Senate. Therefore, Democrats need the support of 20 Republican senators.

Since the Republicans have not supported Trump’s impeachment, it is highly unlikely that Trump’s impeachment leads to his dismissal.

Impact of the impeachment on the 2020 presidential election

The impact of Trump’s impeachment on the presidential election depends on his defense and the credibility of accusations against him. Democrats are well aware that accusing Trump of corruption and incompetence will not affect American voters. Democrats probably knew that those allegations were not strong enough to undermine Trump, but on the contrary they would undermine their positions.

By stating an issue related to U.S. national security, Democrats took the risk of impeachment. To make the impeachment strategy successful, Democrats should prove that the president has endangered U.S. national security and he may do the same in future. This claim can go beyond party politics and put unbearable pressure on Trump, Republicans and uncertain voters.

From our partner Tehran Times

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Americas

Russian Involvement in Venezuela is Troublesome for Western Hemisphere

Todd Royal

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The U.S. Energy Information Administration (EIA) “projects that natural gas consumption in Asia will continue to outpace supply.” With the future growth of natural gas consumption concentrated in Asia the EIA “expects ‘non-OECD Asia’ to consumer 120 billion cubic feet per day (Bcf/d) by 2050, outpacing regional production by 50 Bcf/d.” China’s natural gas consumption will “triple between 2018-2050.” Most long-term natural gas infrastructure, global liquid natural gas (LNG) terminal(s) import and export, and demand projections are based on Asian growth.

Late October reporting in Russian media confirmed Russian energy conglomerate, Rosneft had plans to consolidate Venezuela’s National Oil Company PDVSA (Petroleos de Venezuela) under Rosneft’s corporate structure in exchange for debt relief. This counters U.S., Canadian and Mexican oil and natural gas firms from satisfying natural gas demand from non-OECD Asia. Additionally, it allows Moscow to use Rosneft acquiring Venezuelan natural gas as a geopolitical, soft power coercion tool by acquiring some of the largest recoverable oil and natural gas reserves in the world.

Venezuelan government sources, Rosneft and the Kremlin all denythe potential for a takeover of PDVSA energy assets to satisfy Russian bank loan requirements to the Madero regime. Russian energy experts have visited PDVSA to analyze the possibility of merging with Rosneft. The Russian energy giant buying out Venezuela’s best source of hard currency and domestic economic driver illustrate the “hard-hitting impact of U.S. sanctions.” The Venezuela regime-based economy predicated on oil and natural gas production is on the verge of collapsing.

Rosneft’s offer is the best way outside of western help for Venezuela to mitigate damaging sanctions, and “debt relief for a country that owes over $156 billion to external parties – and Venezuela’s debt is 740% higher than the value of its exports.” This is four times more than what is typical in emerging markets and economies according to The World Bank.

U.S. Special Envoy for Venezuela Elliot Abrams has pointed to Rosneft having joint projects with PDVSA where it took leading minority stakes, and how these ventures do not “breach” U.S. sanctions. This is positive news for average Venezuelan citizens suffering under economic malaise. Caracas’ debt to Moscow seemingly is being forgiven under the auspices of U.S. blessing. However, the Trump administration has been clear in its maximum pressure “sanctions policy towards Venezuela” that mirrors the sanctions-strategy towards Tehran. Retaliation from the U.S. could be the future of Washington-Moscow-Caracas tri-lateral relations if Rosneft tries to liquidate PDVSA assets, and release thousands of employees to skirt U.S.-led western sanctions.

The Maduro regime will also need to navigate the “$20-$60 billion in debt owed” to China. Will the Chinese have a stake in PDVSA? If so, how does that play into the current U.S.-China trade negotiations? What these geopolitical decisions points towards is a Rosneft-PDVSA merge bringing up more questions than answers.

It makes sense for Russia to be the power broker in Venezuela. This is similar to how Russia is the safe diplomatic choice in the Middle, post-Syrian civil war. According to Foreign Affairs, Russia is now “the Indispensible Nation in the Middle East.” Military troops and hardware were used to save the Assad regime, and now in Venezuela it will be oil, natural gas and petrochemicals that gives Russia a solid foothold in the western hemisphere. PDVSA is one of the “world’s most prolific oil companies” with the largest extractable oil and gas reserves in the world – estimated at 300 billion barrels and PDVSA’s estimated worth is “approximately $186 billion.”

Putting this energy portfolio under Kremlin influence gives Rosneft and other energy firms aligned with Moscow solid footing to control price and supply for global oil and petrochemical markets. The Maduro government wants to stay with previous joint venture contracts between PDVSA and Rosneft, and if the merger takes place, wants to “hand control over to Rosneft without having to go through privatization.” Financial questions arise from this arrangement; who is responsible for terms of debt, how is China able to value the deal, and would equity be defined as a public, private or some form of public-private entity? These are some of the larger issues that would need to be resolved.

Maduro can possibly work around these issues when he took over Venezuela’s Supreme Tribunal of Justice. This allows Maduro to ignore the democratically elected Legislature, the opposition-controlled National Assembly, and its leader, Juan Guaido. Mr. Guaido claims he is the legitimate leader of Venezuela, but likely Rosneft with Moscow’s backing will only negotiate with the Maduro government. The Supreme Tribunal of Justice can overrule the Assembly to assist the merger towards completion. Debt repayment is important to the Maduro regime, and return to financial health.

Citgo, a U.S. based company that is a valued asset for PDVSA is another area of concern for the proposed merger in tandem with U.S. sanctions.

American officials have implemented a freeze on all Venezuelan assets based in the U.S. Washington implemented an executive order coinciding with sanctions protecting “bondholders and other parties” mulling asset sales and seizures for unpaid debts. The international desire among government and financial officials is this move by the Americans facilitate diplomatic solutions over asset seizure. The downside is it strengthens Maduro over the elected Venezuelan legislature and Assembly leader Guaido.

Debt holders who own Citgo then have to negotiate with Venezuela and Rosneft. This will be tough for bondholders to receive repayment, or will it, as this could mean tougher going for international credit markets to lend money for future Rosneft/PDVSA projects. A Moscow-Caracas alliance is something Washington could believe will increase geopolitical tension between all three countries. Debt relief for Caracas, and control over the world’s largest oil reserves are likely to be the final push for Rosneft to acquire PDVSA over escalating tensions between Moscow and Washington with Caracas stuck in the middle.

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