Mexico and the World: “Uncertainty, the New Norm”

Antonio Garza (Mexico, 2002-2009)

This past year has proven to be an interesting time to watch the political and economic dynamics across the Western Hemisphere. Elections have reshaped political realities, with new presidents and outlooks for Mexico and Brazil, and a new majority in the U.S. House of Representatives.

Throughout the region, other countries have systematically dismantled their democracies, with Daniel Ortega in Nicaragua continuing to crack down on the political opposition, Nicolás Maduro in Venezuela deepening his stronghold on power, and Juan Orlando Hernández in Honduras entering office this past January among allegations of electoral fraud. As these countries’ economic fortunes have plummeted and political risk levels spiked, millions of their citizens have fled into surrounding countries and north to the United States—creating another series of tensions that have dominated the news for much of the past few months.

Looking out to 2019, the region and the world don’t look any more stable, with many of the same challenges expected to continue.  Trade skirmishes, market volatility, and serious security issues are also likely to persist. While in the United States, President Donald Trump faces 17 investigations and a new head of the House Committee on Oversight and Government Reform is gearing up to shift the political status quo. And during the past year, the United States has continued to step away from any significant regional or global engagement and other non-regional actors will increasingly be all too happy to fill the void.

From a Cult of Safety to Wise Society, Maybe

Richard Holwill (Ecuador, 1988-1999)

Cross posted from Holwill & Company

Jonathan Haidt’s book “The Righteous Mind” is among the most important books that I’ve read in the past 20 years. It caused me to rethink political debates and to change my approach to most discussions. That is a high bar and, while “Coddling of the American Mind” doesn’t reach it, it is certainly worth reading. My problem with the book is not that I disagreed with it. Rather, I agreed with so much of the first two parts that I almost stopped reading. That would have been a serious mistake.

To write this book, Haidt teamed up with Greg Lukianoff, head of the Foundation for Individual Rights in Education (FIRE) a group that I respect and have previously supported financially. (Note to self: don’t forget to write a check to FIRE this year). The narrative recounts the movements on college campuses to suppress speech that does not conform to an approved agenda. The authors further explain how we got here and suggest that, left unchecked, this trend could contribute to the erosion of democracy.

It is this portion of the book that I found to be fascinating. Haidt and Lukianoff don’t just bemoan the polarization in society, they identify six threads that have driven the phenomenon. Among those, two stand out in my mind.

The first is the developmental distortions that flow from “paranoid parenting,” which results in emotionally fragile children. Although I had never thought much about how I grew up, I assumed that children today had experiences that did not differ greatly from my own. In today’s environment, my parents might have been arrested for allowing me to roam the streets with a group of friends and, heaven forbid, take a gun into the woods alone to hunt squirrels and other small creatures.

USMCA, just don’t call it NAFTA

Antonio Garza (Mexico, 2002-2009)

Cross posted from Ambassador Garza’s website

It’s been thirteen months, nine official rounds of negotiations, countless side meetings, and a brief period where Canada’s participation appeared precarious, but this past Sunday night, the U.S., Mexican, and Canadian negotiators finally announced a new regional trade agreement. The United States-Mexico-Canada Agreement (USMCA) builds on the old NAFTA and pulls in much of the modernization that had been outlined in the previous Trans-Pacific Partnership (TPP) negotiations. In fact, the similarities are so strong, that the agreement has been deemed more of a rebranding than a trade revolution. However, there are some notable changes to the deal’s content, the tone of the negotiating process, and the agreement’s potential long-term regional effects.

In the new agreement, the United States coaxed modest concessions from Canada and Mexico, as both countries staked out positions that generally sought to protect the status quo. The biggest trade shift was in the regional content requirements for automobiles, which would be slated to rise from 62.5 to 75 percent by 2020. Additionally, by that same year, 40 percent of car value would have to be produced in factories that pay their workers at least a $16 an hour wage. These measures clearly aim to keep manufacturing jobs in the United States and Canada. However, time will tell if they have the intended effect or if companies find it cheaper to forego the tariff exemptions altogether rather than comply.

Is Venezuela Facing a Foreign Military Intervention?

John Maisto (Organization of American States, 2003-2007; Venezuela, 1997-2000; Nicaragua, 1993-1996)

In the Latin America Advisor, Ambassador John Maisto responded to this question: Organization of American States Secretary General Luis Almagro this month said that a “military intervention to overthrow” Venezuelan President Nicolas Madura shouldn’t be ruled out. Almagro’s comments echoed remarks a year ago by U.S. President Donald Trump that he wouldn’t take a “military option” in Venezuela off the table. How likely is a foreign military intervention in Venezuela? How would it take shape, and who would orchestrate it? Would such an action be justified, and what would be the most likely outcome and consequences of foreign troops in Venezuela?

UNIFIL Mandate Renewed Amid Continuing Concerns and Qualified Support from Security Council

Photo: Dutch UNIFIL base, 1981

Edward M. Gabriel (Morocco, 1997-2001) and Jean AbiNader

On August 30th the UN Security Council renewed the mandate of the UN Interim Force In Lebanon (UNIFIL) for a year. UN Security Council members expressed serious concerns, according to VOANews.com, “that violations of the cease-fire agreement between Lebanon and Israel could lead to a new conflict and urged international support for Lebanon’s armed forces and their stepped up deployment in the south and at sea.”

Rodney Hunter, the USUN Mission’s political coordinator, told the UN Security Council during its meeting that twelve years after the council imposed an arms embargo “it is unacceptable that Hezbollah continues to flout this embargo, Lebanon’s sovereignty, and the will of the majority of Lebanese people.”

The centerpiece of UNIFIL’s mandate is UNSC Resolution 1701, which limits the flow of arms into the southern region of Lebanon, provides for routine meetings between the Israeli Defense Forces and the Lebanese Armed Forces (LAF) brokered by UNIFIL (the only direct contact between Lebanon and Israel), calls for disarming the area south of the Litani River, and assists the LAF forces in providing security throughout south Lebanon.

China is stealing American intellectual property. Trump’s tariffs are a chance to stop it

Curtis S. Chin (Asian Development Bank, 2007-2010) and Charlene L. Fu

Cross posted from Los Angeles Times

A U.S.-China tariff war is sure to produce very real economic consequences, and political fallout, in both nations. It also presents an opportunity to reexamine the trade relationship between the world’s two largest economies and perhaps set a new course that would address some of the elephant-in-the-room issues of China’s trade practices.

Whatever else one might think of President Trump’s actions, he is confronting China about its unfair trade practices and theft of American intellectual property when too many others shy away from the truth for fear of Chinese reprisal.

This summer Trump imposed 25% tariffs on a total of $50 billion worth of Chinese goods, and Beijing retaliated. Trump is now considering adding more Chinese products — at least $200 billion worth — to that list. The response in the U.S. has been stock market volatility and hand-wringing about rising manufacturing costs and consumer prices.

Asia’s Polluted Skies: from Challenge to Opportunity

Curtis S. Chin (Asian Development Bank, 2007-2010)

Cross posted from LinkedIn

BANGKOK – Every year and throughout the year, pollution increasingly takes its toll across Asia. But there is also hope and opportunity as evolving Asian consumer behavior and activism further encourages the transition away from a focus on “development at any cost.” As the Milken Institute Asia Summit #MIGlobal 2018 convenes in Singapore, this trend should be front and center.

Governments and businesses must recognize that there are ways to better align short-term economic interests with the longer-term goal of ending the rampant pollution that too much of the increasingly urbanized Indo-Pacific region is known for.

I see this in my own work with impact investors and start-ups, including through serving on the advisory board of Equator Pure Nature, a Thailand-based “cleantech” company that produces, markets and sells a line of natural, environment-friendly, biodegradable household cleaning products under the brand name Pipper Standard.

With growing numbers of consumers in Asia concerned about the impact of polluted skies and water on them and their children, the trend toward healthier products that began in Europe and the United States has come to the Indo-Pacific region. It is time for all Asia to transition to a more sustainable approach to development—and put an end to the rampant pollution that all too often helps ensure hashtags #smogageddon and #airpocalypse end up trending on social media each year.

Uganda’s Bobi Wine Brings Attention to Museveni’s Repressive Politics

Michelle Gavin (Botswana, 2011-2014)

Cross posted from Council on Foreign Relations

Recent events have shone an international spotlight on Uganda, where the government’s treatment of parliamentarian and musician Robert Kyagulanyi, better known by his stage name, Bobi Wine, is bringing new attention to the repressive nature of Ugandan politics, and new energy to those resisting the status quo. He recently arrived in the United States to seek medical treatment for injuries allegedly sustained while in government custody.

A by-election held on August 15 in volatile northwestern Uganda to replace a member of parliament who had been assassinated in June triggered the current crisis. Campaigning had been contentious, and Ugandan authorities deployed a heavy security presence to the area in the immediate preelection period. President Museveni traveled to the region to support the ruling party candidate, while Kyagulanyi and others were in the area to stump for their preferred choices. On August 13, rock-throwing demonstrators triggered a violent reaction from security forces, leading to beatings, the fatal shooting of Kyagulanyi’s driver, and the arrest of Kyagulanyi and other opposition figures.

Thus far, the case does not inspire great confidence in the Ugandan judicial system. First, Kyagulanyi and others were charged by a military tribunal with illegal possession of weapons. Their court appearances have been harrowing, as many appear to have been mistreated in detention, a charge the government denies. When the military charges were dropped, they were immediately replaced by charges of treason in civilian court. Within Uganda, demonstrations and riots erupted in protest, and journalists covering them have been beaten along with participants. While Kyagulanyi and others were granted bail on August 27, they remain in legal jeopardy.

Oh, Canada!

Antonio Garza (Mexico, 2002-2009)

Cross posted from Ambassador Garza’s website

On Monday—just over one year since Mexico, Canada, and the United States officially began the NAFTA renegotiations—President Donald Trump announced the “The United States – Mexico Trade Agreement.”

During an impromptu press conference in the Oval Office, Mexican and U.S. officials declared that they had finally moved beyond the thorniest issues including auto content and Mexico’s energy sector and come to a “trade understanding”. It is undoubtedly a leap forward in the negotiations, but it might be wise to hold off on any immediate celebrations.

The most pressing challenge is now Canada’s participation. The Monday press conference had a solidly bilateral focus, with Canada almost completely absent from the festivities. Worse, when the country made an appearance, it was as part of a U.S. threat to push for separate deals. Mexico, on the other hand, sent mixed messages on Canada’s involvement. Mexican President Enrique Peña Nieto repeatedly called for Canada to be re-incorporated into the negotiations, but Foreign Minister Luis Videgaray simultaneously suggested that Mexico may be willing to move forward alone.

Thailand’s Cryptocurrency Scandal must not Derail Fintech Momentum

Curtis S. Chin (Asian Development Bank, 2007-2010)

Cross posted from The Nation

The daily media headlines covering the latest Bitcoin scandal to hit Southeast Asia read like a Hollywood script. Indeed a local actor nicknamed “Boom” is now part of the mix. As this story unfolds and governments respond, it is important that the further development and application of financial innovations in the region not be unintentionally undercut.

This time, Asean’s second biggest nation as measured by GDP, Thailand, unfortunately plays a starring role in the latest cryptocurrency scandal.

According to local media reports, an investor in the Stock Exchange of Thailand and staff at up to three Thai banks may well have been complicit in a US$24-million scandal involving a businessman from Finland, a Macau casino and a cryptocurrency called Dragon Coin.

Described by media as an early investor in Bitcoin who made millions from his ventures, the Finnish national Aarni Otava Saarimaa is said to have lost more than 5,500 bitcoins in a well-orchestrated scam. The crypto-millionaire has told Thailand investigators that he was duped into sending bitcoin to Thai nationals for reinvestment, to include purchase of Dragon Coin, a cryptocurrency that would be used at a casino in Macau – a special administrative region of China.