"The Fifth Summit of the Americas: Return of the Good Neighbor Policy?"
By Ray Walser
The Heritage Foundation
April 21, 2009

The Fifth Summit of the America's was characterized by feel-good rhetoric and the resurrection of FDR's Good Neighbor Policy. However, the real impact of the summit--if there is to be one--will not be clear until the Administration addresses four basic challenges.

...|See complete report

"State’s Shannon Reviews U.S. Policy in the Americas"
By Tom Shannon, Assistant Secretary of State for Western Hemisphere Affairs
U.S. Department of State
January 23, 2008

(...) The principle themes or pillars of our America’s policy are consolidating democracy and promoting prosperity, investing in people and protecting the security of a democratic state.(...)

(...) And in regard to Argentina, our relationship with Argentina is an important one for us. Historically, it’s been a very strong relationship. I believe it still is a strong relationship. And it’s our intent to make sure that we stay focused on the fundamental interests that join us as nations and as members of a democratic and free America, and do everything we can to strengthen that relationship.

(...) From our point of view, 2007 really did represent a year of engagement, as we have called it, not only at the presidential level, but at the cabinet level.(...) And as we look to 2008, we really hope to make this a year of partnership. We hope this to be a year in which we consolidate what we achieved through our engagement in 2007, but also to highlight the sustainability of our policy, to highlight the bipartisan nature of it and to show that the United States understands that in order to maintain influence in the region, it has to be present and that we have to be present in a way which is helpful to the governments of the region.(...)

...|See complete article

"Argentina: Forecast"
The Economist
April 13, 2009

Outlook for 2009-10

- The president, Cristina Fernandez de Kirchner, faces mounting challenges as tensions rise with the farming community, alliances with state governors weaken and policy improvisation exacerbates the economic deterioration.
- The outcome of the mid-term October 2009 congressional poll is expected to leave Ms Fernandez a lame duck until the 2011 general elections; as tensions mount, there is a significant risk that she will be unable to see out her term.
- Given quickly declining business and consumer confidence, the government's fiscal stimulus measures will have a limited effect and we expect the economy to contract by 2.8% in 2009 before only a mild recovery in 2010.
- Although the government will be able to remain current on most of its obligations in the approach to the October elections, the outlook for the public finances will darken in 2010, raising the risk of a sovereign default.
- Weaker agricultural export earnings and the recession will hit the public finances, narrowing the primary surplus to 1.5% of GDP in 2009, leading to an overall budget deficit of 0.8% in 2009 with a further deterioration in 2010.
- Unofficially measured inflation will ease to 10-15% in 2009 as private demand falls. The official rate will end 2009 at 7.1%, easing slightly in 2010.
- The peso will weaken significantly in 2009 owing to weaker foreign exchange inflows, before the pace of depreciation slows in 2010. The current-account will swing into deficit in 2009-10, after large annual surpluses since 2002.

Monthly review

- In February Mauricio Macri, the mayor of Buenos Aires city and leader of the centre-right Pro, and two dissident peronist congressmen, Felipe Sola and Francisco de Narvaez, announced an alliance to oppose the Kirchners.
- The Kirchners have lost key allies ahead of the October elections, including a senator, Carlos Reutemann, over the conflict with farmers. Mr Kirchner may stand as a candidate to try to bolster the presidential couple's power.
- The deceleration in tax revenue observed in the fourth quarter of 2008 continued in January, narrowing the primary surplus to Ps2bn in that month.
- The government is threatening to nationalise the grains market in order to try to force farmers to ship grains held in storage to boost fiscal revenue.
- The government swapped Ps19bn of bonds maturing in 2009-11 yielding debt-service savings of US$2bn in 2009, but debt-sustainability concerns persist.
- GDP grew by 4.8% in the fourth quarter, according to official data. But private estimates point to a contraction, raising concerns that the government is meddling with the national accounts data.


...|Accede to the forecast of The Economist