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Annual Report on Latin America and the Caribbean (2017-2018)

Autor:Yuan Dongzhen, Vice-president of ILAS CASS  Fecha:2018-08-20

 Preface

 

In the past year or so, the world has undergone important changes that cannot be ignored and there are some political and economic phenomena that warrant attention. In the economic field, there are more favorable and stable factors. In 2017, international trade resumed growth, international investment rebounded, global industrial production increased, and the scope of economic recovery expanded. The economic performance in more and more countries was better than expected. Driven by these favorable factors, the world economy has reversed from the downward trend and gone out of the low-growth situation that began from 2010, and it is expected to achieve a growth rate of 3.6% in 2017. Developed economies generally witnessed a faster economic growth: the growth rate rose from 1.6% in 2016 to above 2% in 2017. At the same time, the unemployment rate in developed economies decreased. For example, in the U.S. this indicator fell to about 4.3%, in Japan to a historically low of only 2.8%, in the EU to 7.7%, and in the euro zone it also reached the lowest level since 2009. The growth rate of emerging economies in 2017 was over 4.6%, higher than that of developed economies. As the largest developing economy, China has maintained a stable economic growth. Driven by the Chinese economy and the booming demand from developed countries, the growth rate of Asian developing countries exceeded 5% in 2017. Africa’s economy, though faced with many risks, has also accelerated its recovery. Latin America and the Caribbean (LAC) achieved a slight increase in 2017 after a two-year contraction. The once-widened gap of economic growth between Northern and Southern countries began to narrow.

In the field of international politics and diplomacy, anti-globalization trends have intensified with the Brexit and Donald Trump coming into power in the U.S.. Trump’s "America First" policy has added uncertainties to the development of Latin America and the world. The global political and security situation is still grim and complex. Numerous issues, old and new, are intertwined. Old contradictions have not been completely resolved while new challenges have emerged. However, the practice of globalization and regionalization has been substantially promoted at the same time. Since 2017, the European Union has reached a framework of free trade agreement (FTA) with Japan and Canada; the United States has renegotiated on the amendment of the North American Free Trade Agreement (NAFTA) with Canada and Mexico, and revised the FTA with South Korea; the Pacific Alliance countries have explored the way to establish new free trade areas and sent invitations to some countries outside the region; after the United States withdrew from the Trans-Pacific Partnership Agreement (TPP), the remaining 11 member countries announced that they would sign a new free trade agreement. Many international organizations and financial institutions have also called for opposition to trade protectionism and support for multilateral trade. It is worth noting that developing countries and emerging market countries have increasingly become important players in global governance and continued to promote reform of the unreasonable international economic and political order. The world's political and economic landscape is expected to undergo significant reform.

Against the background of major changes in the world economy and international politics, a series of new changes have taken place, or are taking place, in Latin America’s economic realm, political ecology, and social environment. Some countries in the region have adopted or are seeking political reform corresponding to the new changes in their external environment, since they face mounting pressure for adjustment to both domestic and foreign policies. China-LAC relations have ushered in new opportunities of development, while some new problems and challenges emerged as well. This year’s “Annual Report of Latin America and the Caribbean” (hereafter referred to “annual report” for short) seeks to analyze the economic, political, social and diplomatic situations in Latin America since 2017, as well as to forecast the new trends in China-LAC relations, and analyze the commonalities and characteristics of the development of major Latin American countries.

First, the “Belt and Road” (B&R) Initiative will create a new situation for China-LAC cooperation.

After the “Belt and Road” Initiative was proposed, many Latin American countries responded positively. Countries like Uruguay, Chile, Mexico, Costa Rica, Suriname, Trinidad and Tobago, Cuba and Venezuela all expressed their interest in this initiative. The Chinese government has confirmed that Latin America is an indispensable and important party in the construction of the OBOR Initiative. In particular, since President Xi Jinping proposed that China and Latin America should jointly build the B&R, Latin American countries realized the significance of the B&R in promoting China-LAC cooperation and the development of Latin America. Many Latin American countries showed their willingness to participate in the B&R Initiative since it will provide new ideas for China-Latin America's all-round partnership, inject new vitality and promise new prospects. Latin American countries mostly agree with new ideas and concepts that China has put forward under this initiative and believe that it will provide new opportunities for the prosperity and development of Latin America. They also showed their willingness of making joint efforts to promote the upgrading of China-LAC cooperation under the B&R Initiative, and to create a new situation in China-LAC cooperation with wider fields, better structure, stronger motivation and higher quality. The B&R has also become a “keyword” for China-LAC cooperation.

One of the main themes of this annual report is the B&R Initiative and the alignment of development strategies of China and Latin America, and published two articles centering around this subject. The article “To Usher in the New Era of Sino-Latin American Relations by Jointly Building the ‘Belt and Road’,” or the main report, conducted a preliminary study on China-LAC cooperation under the B&R framework, and provided some thoughtful insights into how to reach a consensus on jointly building B&R  and promoting the development strategies of both parties. According to the proposal in this report, Latin America should correctly understand China’s economic development strategy in the new era, promote the B&R construction and international cooperation at the domestic, sub-regional, and intercontinental levels; China-LAC overall cooperation should be analyzed from the B&R perspective and should learn from those successful experiences; the two sides should work together to explore a feasible mechanism for interconnectivity and cooperation of market, capital and infrastructure; seek ideological consensus on the dialectical relationship between labor and capital, between government and market, between nation and the world; consolidate developmental consensus by reducing or eliminating structural imbalances in Latin American countries. The article "On the Feasibility of Connecting ‘Belt and Road’ Initiative to Latin America", a special report in this annual report, explores the feasibility of aligning B&R with Latin America and possible challenges on the basis of analysis from historical, political and realistic dimensions. The author argues that the linkage between China and Latin America under the B&R framework has historical, policy, and realistic foundations; China-Latin American trade has the historical experience of the “Pacific Silk Road”; the B&R Initiative and the China-LAC cooperation have a high degree of compatibility in terms of goals, principles, and content; China and Latin America face similar realistic challenges; both sides have already started cooperation in certain fields and accumulated initial experiences.

Second, China-LAC cooperation faces new opportunities for transformation and upgrading.

Against the background of the ever-changing international situation, the profound adjustment of the international pattern, the fragile recovery of the world economy, and Latin American countries’ active promotion of pluralistic diplomacy, the consensus between China and Latin America on deepening mutually beneficial cooperation and seeking common development has been further enhanced. On the basis of the 13 key cooperation areas and related measures illustrated in the “China-Latin America and the Caribbean Cooperation Program (2015-2019)”, the second ministerial meeting of the “China-Latin America Forum” in January 2018 formulated specific initiatives in key cooperation areas such as security, trade, investment, finance, infrastructure, and transportation, opened new cooperation areas such as anti-corruption, anti-drug, and anti-cyber crime, highlighted new ideas such as innovation-driven development, green and sustainable development, and the UN's 2030 sustainable development goals. The objectives of China-LAC cooperation are more accurate, the increasingly pragmatic cooperation methods are more suited to the actual needs of Latin American countries, and more conducive to better and faster cooperation between China and Latin America. To effectively implement the above-mentioned consensus and goals, and to lift China-LAC all-round cooperative partnership to a new level, China and Latin America should continuously make joint efforts to overcome institutional constraints and policy barriers, eliminate or reduce difficulties in practice, and cope with new challenges on the basis of equality, mutual benefit, and common development.

This annual report focuses on China-Latin America cooperation with several special reports, which analyze issues related to China-LAC cooperation from different perspectives, respectively. One special report titled “Strategic Positioning of China-Latin America Relations amid Dual Economic and Diplomatic Transformation” pointed out that currently both China and Latin America are faced with the task of “double transformation” of economy and diplomacy, and China-LAC relations have the feasibility of continuing the period of “strategic opportunities”. In China's "double transformation", the strategic positioning of Latin America mainly focuses on areas such as market capacity, capacity cooperation space, and global governance cooperation in the region. In the “double transformation” phase of Latin America, China’s importance is more reflected in market demand, investment supply, and diplomatic diversification options. The author emphasizes that important changes have taken place in the internal momentum of China-LAC relations: China's policy towards Latin America embodies greater planning and becomes more diversified; at the same time, Latin America’s initiative in cooperation with China has significantly increased. The author suggests that the next phase of China’s policy toward Latin America needs to effectively coordinate the overall cooperation with bilateral cooperation, make economic cooperation a priority of policy goal, and plan a strategic layout for key countries and important areas. The special report titled “The Building of the China-LAC Community of Shared Future: The Perspective of Cultural Exchanges” points out that the construction of the China-LAC Community of Shared Future has become the logical starting point and the basic goal of the current development cooperation between China and Latin America, wherein the cultural factor is of vital importance to ensure its success. The author argues that the basic approaches of constructing the community of shared destiny from cultural aspects include language, culture, academia and the media, and that it is urgent for both sides to co-establish mechanisms of cultural exchange and cultural industry cooperation so as to achieve sustainable cultural exchanges with compounding effects.

Third, the economic, political and social ecology in Latin America continues to undergo new changes.

In 2017, the economic, political and social ecology in Latin America undergone new changes. The regional economy has reemerged from the declining situation for two consecutive years and achieved low-speed growth; foreign trade has shown signs of recovery, ending the continuous decline of export commodity prices and the slow growth of export volume for five consecutive years. As the "pink tide" that lasted for more than a decade continues to fade, even the left-wing governments remaining in power have also accelerated its reforms and adopted policies that are more moderate and practical. The factors conducive to the stability in Latin America have further increased. However, there are still some destabilizing factors. In particular, the negative impact of the political crisis in Venezuela has brought serious challenges to regional solidarity and cooperation. Besides these, many Latin American countries have strengthened anti-corruption efforts and made new progress in the fight against corruption.

With regard to these new changes and new trends in the political economy and social ecology in Latin America, three reports titled respectively “Latin America Economic Situation”, “Latin America Political Situation” and “Latin America Social Situation”, provide detailed analysis of regional situation from three different perspectives. The report “The Economic Situation in Latin America” pointed out that the Latin America region has ended its two-year recession, the economy of which has regained growth, and major basic indicators such as inflation and international balance of payments have also shown some improvements. In the context of macroeconomic improvements, the fiscal policy of Latin American countries aimed at ensuring fiscal stability, while many regional countries strived to increase revenue and reduce expenditure. However, the economic growth rate in Latin America is relatively low compared with the international level, and the risk of being marginalized is increasing. Due to the increase of external uncertainties, it is difficult for the regional economy to achieve a strong rebound in the short-to-medium term, and the internal growth disparities among regional countries will continue. According to the report “The Political Situation in Latin America”, the political situation in Latin America has remained basically stable, but a few countries experienced political instability and tension, and some countries were even bothered by serious political conflicts. The illusions of the public over traditional parties and politicians are further shattered, and the support rate for the ruling parties has generally declined. Traditional political parties have lost the upper hand and some political leaders have been trapped in corruption scandal. This has created new opportunities for the rise of anti-establishment forces or “political outsiders”, bringing intensified uncertainties to the 2018 election year. According to the report “The Social Situation in Latin America”, the poverty rate in Latin America has not decreased significantly, with poverty reduction polices confronted with “bottlenecks”. The risk of returning to poverty among the middle and low-income groups has increased, and the impetus for a continued poverty reduction is seriously insufficient. Although the actual wage level has risen slightly, the slow economic recovery has not had a positive impact on employment. Unemployment rate has risen and employment quality further declined. There has been no remarkable improvement in social inequality without significant increase in social spending by governments of regional countries. To make things worse, the effect of income redistribution on poverty reduction is gradually disappearing. Although Latin American countries’ social reforms have made uneven progress, they all have encountered varying degrees of social protests, reflecting the gap between the government's objectives and people's expectations.

Fourth, there are important changes in the external environment of Latin American countries.

While the economic, political, and social ecology in Latin America has undergone rapid changes, its external environment has also gone through significant changes, which has brought certain impact on Latin American countries’ foreign policy and international relations. The most significant change in the external environment stems from the fact that President Trump has pursued the "America First" philosophy and drastically adjusted the policy toward Latin America since he took office. The United States has strengthened trade protectionism policies against Latin American countries, withdrew from the TPP, renegotiated the NAFTA, expelled illegal immigrants from Latin America, narrowed its policy toward Cuba comprehensively, and increased pressure on left-wing governments such as that of Venezuela. Trump's policy readjustment toward Latin America has increased the worries of regional countries, especially Mexico and Central American countries, which have close economic ties with the U.S.. Trump’s policy has worsened the plight of the left-wing government in Latin America, increased contradictions among regional countries to some extent, and intensified the uncertainty of the region’s external development environment. Concerning the political crisis in Venezuela, differences among Latin American countries have become more pronounced, and even serious opposition has occurred.

According to the report “The Situation of Latin America’s International Relations”, the theme of diplomacy for regional countries is still how to adapt to the changes in the global order and power structure, how to act in the whirlpool formed by the intertwining general trend of globalization and backlash against it; how to put forward timely contingency strategies and policies to solve a series of diplomatic problems facing the regional countries amid the "uncertainties" brought by their ever changing economic situation and political ecology. The author emphasizes that the diplomatic problems of Latin American countries not only originate from the changes in the international situation and the accompanying series of challenges, but are also rooted in many historical disputes that have long plagued the regional countries and re-fermented under new conditions and pressures. Latin American countries are mulling over new policies toward North America, Europe, and the Asia-Pacific region, and constructing new models for handling relations among regional countries, indicating new changes in Latin America’s foreign policy in the coming years.

Fifth, the influence of differences among Latin American countries continues to ferment.

The differences among Latin American countries in economic, political and social aspects still exist, therefore relevant pressures on these governments are different. The difference among Latin American countries is first manifested in varied speeds of economic growth, due to the different growth dynamics of countries and sub-regions. South American countries, which mainly produce and export primary products such as oil, minerals and food, have showed strong momentum after two consecutive years of negative growth. The economic growth in Central American countries is the strongest, and in the Caribbean countries relatively low due to natural disasters. The growth rates of major economies in Latin America, including Brazil, Argentina, Mexico, Chile, and Venezuela, also differ greatly. The differences are also significant in social and political realms, and are reflected in many aspects such as employment pressure and intensity of social conflicts. Due to the different situations and pressures, the prospects for the ruling parties in various countries are mixed. Regarding the differences in the political, economic, and social fields of Latin American countries and their consequences, this annual report incorporates 20 country reports, including that of Brazil, Mexico, Venezuela, Colombia, Chile, Peru, and Cuba, etc. These country reports provide a reference for understanding the specificities of and differences among Latin American countries.

In conclusion, reform and development, changes and adjustments, opportunities and challenges, uncertainties and differences are key words and important features of the political, economic, and social development in Latin America at present, and will remain so in the future.

 

March 2018

 

1.

To Usher in the New Era of Sino-Latin American Relations by Jointly Building the "Belt and Road"

Xie Wenze 

Abstract: In 2017, Latin America started the process of aligning with the "Belt and Road" initiative. In January 2018, President Xi Jinping proposed the initiative of jointly building the "Belt and Road" between China and Latin America. Against the backdrop, this article proposes some suggestions for accelerating the process and achieving "the consensus of jointly building the initiative". First, Latin America should correctly understand China's economic development strategy in the new era and China's implementation of the “Belt and Road” initiative. China's economic development strategy in the new era can be interpreted as a strategic coordinate, which reflects its open, inclusive and sharing natures. With itself as the fulcrum, China has been promoting the building and international cooperation of “One Belt, One Road” at the domestic, sub-regional, and intercontinental levels. Second, it is necessary to comb the Sino-Latin American overall cooperation from the perspective of “One Belt , One Road”, to sum up the experiences of successful cases such as China-Chile free trade and production-capacity cooperation, and the Phase I of Brazilian Belo Monte energy transmission line. Third, efforts should be made to explore the alignment and cooperative mechanisms for market, capital, and infrastructure. The infrastructure interconnection in the Latin American region can be a priority for jointly building “Belt and Road”. Fourth, it is important to achieve the "thinking consensus" by focusing on the dialectical relationships between labor and capital, government and market, and the state and the world, and fifth, to achieve the “development consensus” by focusing on how to reduce or eliminate structural imbalances in Latin American countries.

Keywords: Jointly Building; "Belt and Road"; Sino-Latin American Relations; The New Era

 

2.

Latin America Political Situation in 2017-2018: Embracing the Election Year

Yang Jianmin

Abstract: In 2017-2018, the political situation in the region is basically stable and the transition of the government is within the framework of the law, but instability and tension have continued in Venezuela and other countries. The legitimacy of the general election in Honduras has been seriously questioned and serious political clashes have taken place. The public's illusions about the leaders of the traditional political parties have been further dashed, as reflected in the ultra-low support ratings of the current leaders of several major countries. The holding of general elections in the context of weak traditional political parties and the corruption of political leaders is bound to create new opportunities for the rise of rebels or "political laymen". In addition, the 2018 elections in Latin America will be held in the fury of public discontent, and corruption cases across the region will bring uncertainties to the election year.

Keywords: General Election Year; Political Division; Political Corruption; Anti-establishment Faction

 

3.

Latin American Economic Situation 2017-2018: Weak Recovery and Increasing Marginalization Risks

Yue Yunxai

 

Abstract: In 2017, thanks to the steady recovery of the world economy, global trade and investment expansion, as well as commodity price rebound, Latin America and the Caribbean ended its recession in the past two years. The regional economy recovered and major macro indicators like inflation and international payments turned better. The three major regional economies showed different economic performance. The differences in regional growth converged, yet at the expense of the consecutive slowdown in Central America. Against the background of macroeconomic improvement, fiscal policy of all countries in the region targeted fiscal stability. Increasing income and throttling expenditure have become the choice of regional policies. Meanwhile, the elasticity and space of monetary policy grew a little bit, playing a certain role in providing incentives for economic growth. However, in view of international comparison, the rate of regional growth is still low, and the risk of being marginalized is increasing. Looking forward to the future, the regional economy is expected to continue its growth in 2018 under the favorable external circumstances. However, due to the increase of external uncertainties, the regional economy is difficult to achieve a strong rebound in the middle and short term, and the differences in internal growth will continue.

Keywords: Latin American Economy; the Caribbean Economy; Recovery; Outlook

 

4.

Latin America Social Situation in 2017-2018: Bottlenecks in Development, Difficulties in Reforms

Lin Hua 

Abstract: In 2017, social poverty in Latin America did not change much. Poverty reduction fell into a bottleneck, low- and middle-income groups were at risk of returning to poverty, and there was not enough driving force behind poverty reduction. The slow recovery of Latin American economies did not have a positive impact on employment. Employment difficulties and a decline in the quality of employment were aggravated, but the real wage level rose slightly. Despite the recovery of the regional economy, social spending maintained a moderately tight trend. The problem of social inequality did not improve significantly, and the effect of income distribution on poverty reduction in Latin American countries was gradually disappearing. Remittances hit a record high, mainly due to the steady growth of the U.S. economy and the improvement of the labor market. The corruption was aggravated and became a cancer that eroded the social ethos. Despite the uneven progress of social reforms, they encountered widespread social protests, which reflected the contradictions between the goals of Latin American governments and the expectations of the people.

Keywords: Latin America; Social Situation; Poverty; Employment; Social Reform; Remittances

 

5.

Latin America International Relations in 2017-2018: Adaptation in Tumultuous Times

Zhang Fan

 

Abstract: The main themes of international relations in Latin America from 2017 to 2018 have remained how the countries in the region accommodate themselves to the changes in the global order and in the international distribution of power, especially in the swirl resulting from the interaction between the globalization process and the anti-globalization waves, so that they can more readily manage and solve the problems in their external affairs and on the regional stage, including the relationship with extra-regional powers and the solutions to regional hot issues. In the past year several important bilateral relations between the US and Latin American countries such as those with Mexico, Cuba and Venezuela, and some issues on the regional agenda concerning trade, migration and drugs, as well as the presence in the region of Europe, Russia and China, have all but shown distinct trajectories and characteristics, while at the same time appeared to return to certain traditional patterns of regional international relations. The occurrences in the past year seemed indicative of future developments for the region fermenting new policy trends towards North America, Europe and the Asia-Pacific region, as well as pressing new intra-regional arrangements.

Keywords: Latin America; International Relations; Foreign Policy; the United States; China; Venezuela

 

6.

Strategic Positioning of China-Latin America Relations amid Dual Economic and Diplomatic Transformation

Zhou Zhiwei, Qi Chuanjun

 

Abstract: China and Latin America are currently facing the dual economic and diplomatic transformation. Based on the policy adjustments, Sino-Latin American relations have the feasibility of extending the “strategic opportunity period”. In China’s economic and diplomatic transformations, China’s policy toward Latin America mainly focuses on the regional market capacity, potential of productivity cooperation, and global governance cooperation. Meanwhile, the importance of China in the Latin American dual-transformation is reflected in its market demand, investment supply and diplomatic diversification. Therefore, the internal drive of Sino-Latin American relations has undergone important changes. China’s policy toward Latin America embodies greater planning, and its policy instruments are more diversified. At the same time, the initiative of Latin America to cooperate with China has been significantly enhanced. Under such new circumstance, China should deal well with bilateral and multilateral dimensions of cooperation, prioritize economic cooperation, and strategically plan regarding specific country and the economic sector.

Keywords: China; Latin America; Dual Transformation; Strategic Orientation; Community of Shared Future

 

7.

The Building of the China-LAC Community of Shared Future: The Perspective of Cultural Exchanges

Guo Cunhai

 

Abstract: At present, the building of the China-LAC Community of Shared Future is increasingly becoming the foothold and fundamental goal of China-LAC developmental cooperation. Cultural building matters much for the China-LAC Community of Shared Future because the former works well as a great sustainer of the latter. Culturally, the building of the Community involves four basic ways, i.e., language learning, cultural promotion, academic exchange and media cooperation. The author also holds it is necessary to promote the building of the China-LAC Mechanisms of Cultural Exchange and Cultural Industrial Cooperation in the long run.

Keywords: China, Latin America, Community of Shared Future, Cultural Building

 

8.

On the Feasibility of Connecting “Belt and Road” Initiative to Latin America: Based on the Analysis of Historical, Policy and Reality Dimensions

Zhang Qing

Abstract: Entitled as one of the top national strategies, the “Belt and Road” Initiative and Latin America are connected thanks to historical, policy and reality bases. Historically, Sino-Latin American trade created the “Pacific Silk Road”; in terms of policy, the “Belt and Road” initiative and Sino-Latin American cooperation are facilitated by compatibility in objectives, principles and content; in reality, they have kicked off connection and cooperation in certain fields, and both of them are confronted with similar challenges.

Keywords: “Belt and Road d” Initiative; Sino-Latin American Cooperation; Feasibility

 

9.

Brazil: Economy Recovers Steadily, yet Political and Economic Challenges Remain

Zhang Yong

 

Abstract: Since Michel Temer officially became the president of Brazil in 2016, his ruling journey hasn’t been smoothly as expected. In 2017, although Temer weathered corruption allegations, he hit another new low in polls. Driven by private consumption and exports, Brazil’s economy witnessed a stable recovery with three consecutive quarters of growth. But in the medium term, the economic growth has still been constrained by fiscal deficits and political uncertainties. Corruption investigations have caused political crises continuously, which will delay the reform of the pension system. The two-year economic recession has resulted in a rebound in poverty and unemployment, which couldn’t be changed easily in the short term. With protectionism revival in the US and Europe and globalization suffering setbacks, promoting the diversification of foreign relations is still a priority for the Temer government. Party politics has entered another round of differentiation and re-organization in the coming 2018 presidential election of Brazil. The political struggle will be inevitable.

Keywords: Michel Temer, Economic Recovery, Corruption, 2018 President Election

 

10.

Mexico: Presidential Elections to Proceed amid Domestic and Foreign Challenges

Yang Zhimin

 

Abstract: President Enrique Peña Nieto's low approval ratings have reflected the perception that his government will remain weak during the remainder of his term; and presidential elections in July 2018 will dominate politics. It is estimated that its GDP growth rate was 2.2% in 2017, which is higher that the regional average level but lower than that in previous year. A lack of momentum in the economy has brought uncertainties to NAFTA’s renegotiation. Due to the complicated situation both internally and externally, the Left-wing populism has regained ground. Severe corruption and high rates of crime and violence have posed preeminent challenges. Although two large earthquakes hit Mexico in the year, it is assumed that the broader economic impact will be relatively contained. Under the pressure of the US’s protectionism, Mexico has positively diversified its foreign strategy.

Keywords: Mexico; Presidential and Congressional Elections; Left-wing; Corruption; Foreign Strategy

 

11.

Argentina: Ruling Party Established its Position, Economy Recovered

Lin Hua

 

Abstract: In 2017, the center-right governing coalition, Cambiemos, won a victory in October's mid-term legislative elections. Argentine political right-wing forces continued to rise. Due to the combined effects of internal and external factors, the economic recovery in Argentina was obvious. The government continued to carry out structural reforms. However, all walks of life had mixed opinions on the reform. While the tax reform was generally recognized, the labor reform was highly controversial. The economic recovery led to some improvements in social indicators, but as the inflation rate remained at a high level and the structural reforms of the government affected people's welfare, social discontentment was still on the rise. Argentina continued to pursue pluralistic diplomacy, pragmatic diplomacy and summit diplomacy, actively developed bilateral relations and sought to enhance its position and role within the framework of multilateral cooperation, showing its confidence and determination to integrate into the world and participate in international affairs.

Key words: Argentina; Macri; Mid-term Elections, Structural Reform; Diversified Diplomacy

 

12.

Cuba: Struggling in the Face of Internal and External Problems

Fan Lei

 

Abstract: In 2017, Cuba started the electoral process of the 9th Legislature National Assembly of People's Power. Despite the consequence of hurricanes, droughts, the United States’ blockade policy, the deteriorating situation in Venezuela and other internal and external factors, the Cuban economy was improving slowly with the distinguished performance of the tourism sector. The Cuban government continued pushing forward the reform of state-owned enterprises, the standardization of non-state economy and the attraction of foreign investments. The government also paid attention to health and education, as well as the improvement of communication services and passenger transportation services. However, the shortage of commodity and low income level still affected social stability, and the problem of population aging remained prominent. The relation with the United States tended to be tense, that with the EU advanced steadily, and the ties with traditional friend countries were well maintained.

Key words: 2017; Cuba; Election; Cuba-US Relations

 

13.

Venezuela: Economic Risks Remain a Major Challenge

Wang Peng

 

Abstract: Venezuela saw its GDP shrink for the fourth year running in 2017 and the inflation skyrocketed remarkably due to expansionary monetary policies. Although there was a large increase of oil prices, crude oil outputs in the country continued to drop and failed to improve the economy. Venezuela is expected to contract consecutively in 2018. There were three major elections in 2017, including the constituent assembly, the regional and the municipal elections, which contributed to restoring political stability temporarily in the country. The ruling United Socialist Party of Venezuela (PSUV) witnessed intensified internal conflicts. The upcoming presidential election is to be a major challenge confronting the country in 2018. As an effort to combat the effects of inflation, the government raised the minimum wage three times in the year. Despite financial pressure, it still gave priority to advancing the Gran Misión Vivienda (GMVV) to improve people’s housing conditions. As a result of rising domestic conflicts, Venezuela faced  rising diplomatic pressure from regional countries.

Keywords: Constituent Assembly; Economic Recession; GMVV; Sanctions

 

14.

Chile: Smooth Change of Regime

Lu Siheng

 

Abstract: In 2017, the centre-right candidate Piñera won Chile's presidential election, and the transfer of government from left-wing to right-wing was smooth. The new political power began to rise. The economy was characterized by a deficient aggregate demand and a weak growth, and the government resorted to an expansionary policy. The expansion of investments, promotion of growth expectations, and an economic stimulus will become a priority agenda of the new right-wing government for the next four years. A new round of census started, and the world's largest mining strike broke out. China and Chile signed a bilateral deal on upgrading the FTA. Bachelet expected that Chile will build a bridge between China and Latin America with the Belt and Road framework.

Keywords: Chile; Presidential Election; Sebastián Piñera; Economic Stimulus; China-Chile FTA

 

15.

Colombia: Peace Agreement Made Slow Progress

Chen Yuanting

 

Abstract: In 2017, the government declared the conflict officially over, and the Santos administration strived to implement peace accords with the former FARC rebels before his term ends. Progress will then hinge on the outcome of the 2018 legislative and presidential elections. The economic slowdown might have bottomed out, the structural deficit target set under the fiscal rule for the central government was achieved, the deficit on current account shrank, and inflationary pressures eased. The economy is expected to make a gradual recovery in 2018. In social terms, violence occurred frequently, poverty remained the major challenge, and protests exerted pressure on the government. In foreign relations, President Santos maintained a cooperative relationship with the Trump administration; ties with Venezuela were strained by border security disputes.

KeywordsColombia; Peace Agreement; General Election; Pacific Alliance; Border security

 

16.

Peru: Anti-Corruption Triggered President Impeachment

Tan Daoming

 

Abstract: The keyword in Peru’s politics of 2017 is anti-corruption. The anti-corruption drama extended from the central government to local government, from the opposition to the ruling party, from ex-presidents to the current president. It was reported that Pedro Pablo Kuczynski granted the medical pardon to the jailed former authoritarian leader Alberto Fujimori, in exchange of not being impeached by Peru’s opposition controlled congress. However, after the scandal of the political deal was exposed, PPK finally was forced to resign. The economic growth continued, but slower than the previous year. Social governance was to be challenged on the issues of poverty reductions and anti-drug plans. The government continued to promote regional integration with expanding FTAs, and kept positive ties with China.

Keywords: Peru; PPK’s Administration; Anti-corruption; President Impeachment

 

17.

Bolivia: Morales Sought the 4th Term after 12 Years in Office

Song Xia

 

Abstract: Evo Morales has accepted his ruling party Movimiento al Socialismo’s nomination as candidate for the 2019 presidential election after 12 years in office, although this runs counter to the 2009 constitution as voters rejected the government’s bid to extend presidential term limits in a referendum in February 2016. The economic growth slowed down in 2017, yet still kept positive growth. Morales’ reforms failed to satisfy the demands of diverse social groups and continued to provoke various social unrests and protests. Morales’ foreign policy focused on cultivating stronger relations with non-traditional partners such as China, Iran and Russia, and sought to pluralize foreign relationships with the aim to combine domestic development needs with foreign strategies.

Keywords: Fourth Term; Slowdown; Pluralization; Non-traditional

 

18.

Ecuador: The Economy Restored Gradually, the Ruling Party Divided

Fang Xufei

 

Abstract: In 2017, the presidential and parliamentary elections were held in Ecuador, the candidate for the ruling party, Lenín Moreno, was elected president. But soon the ruling party divided, the main reasons were the divergence of political and economic policies and the growing contradiction between Moreno and former president Correa. The annual growth rate of GDP was 1% in 2017, which showed that the economy had a restorative growth. The rapid growth of public debt has caused great challenges to fiscal policy. The unemployment rate is low, but the under-employment rate is high, and the labor market needs to be further improved. In terms of foreign relations, the Moreno administration hopes to improve the relationship with the United States and change the hostile attitude of the former government towards the United States.

Key Words: Ecuador; General Election; Lenín Moreno; Correa

 

19.

Uruguay: Corruption Scandal Ended, Economic Growth Accelerated

He Luyang

 

Abstract: In 2017, Uruguay’s Sendic made way for the first female vice-president. The former resigned to pay for his irregularities. Pension reform and UPM negotiations became the major challenges for FA coalition. The most notable characteristics of the Uruguayan economy in 2017 were an acceleration of economic growth, a high and persistent fiscal deficit, and a historically low rate of inflation. The security situation was grim. The tensions among the government, trade unions and the business community became the major sources of social conflicts. In 2017, Uruguay had diplomatic frictions with Brazil and Venezuela.

Keywords: Uruguay; Corruption; Pension Reform; Uruguay-Brazil Relations

 

20.

Paraguay: Parties Preparing for Presidential Election 

Li Hui

 

Abstract: After the failure of President Carter to seek re-election, the division within the Partido Colorado deepened. There are two presidential candidates from this party, representing different political factions. The oppositions are preparing for the election and choosing their own candidates. However, candidates of Patido Colorado are likely to win. Paraguay's economy steadily increased in 2017, higher than the average growth rate in Latin America. Constant social unrest, frequent attacks, cross-border violent crimes expose the most serious national security precautions. Diplomatically, the Carter administration has actively consolidated its relations with Latin American countries and sought trade and investment cooperation outside the region.

Key Words: Paraguay; Partido Colorado; Election; External Relations

 

21.

Costa Rica: Political Landscape Remained Fragmented, Fiscal and Tax Reform Stuck in the Mire

Lou Yu

 

Abstract: 2017 is the final year of President Solís’ four-year term. Legislative fragmentation stalled further breakthrough in reform programs. In the economy arena, the situation of low-speed growth continued. The inflation rate hit the target range set by the central bank for the first time in more than two years. The fiscal deficit, the public debt ratio and the high unemployment rate were still the three major problems facing the Costa Rican economy. In the social area, the poverty rate and the Gini coefficient dropped again, but the public security situation did not improve. The homicide rate reached the standard of rampant violence for three consecutive years. In terms of external relations, Costa Rica actively participated in global and regional integration, and continued exploring how to deepen its relations with countries in the Asia-Pacific region. The establishment of diplomatic relations between China and Costa Rica entered the tenth year, and the relations between the two countries continued to improve.

Keywords: Costa Rica; Political Fragmentation; Fiscal Reform; Unemployment

 

22.

Nicaragua: Politics Under the Control of FSLN, Economy Continued to Grow

Li Han

 

Abstract: The ruling political party of Nicaragua, the National Liberation Sandinista Front, swept the 2017 municipal elections and President Ortega is still the most popular political figure. The economy continued its strong performance with the second-highest GDP growth among Latin American countries. The anti-poverty programs run by the government made great progress in the past ten years. Nicaragua is the 6th most gender equal country in the world and leads the regional rankings. The political and economic relationship with Venezuela was uncertain, and ties with the US were strained. Its relations with Taiwan and Russia became increasingly closer.

Keywords: Ortega; FSLN; Municipal Elections in 2017; Anti-poverty Programs

 

23.

Honduras: Presidential Election Made Politics Confusing

Han Han

 

Abstract: In 2017, both the economic and social policy promoted Honduras’ national development. With the strict macro-economic policy, Honduras ranked top among Latin-American countries because of the continuous economic growth. Some of the economic indicators were relatively higher than the region’s average. Both the crime rate and the homicide rate dropped. Because candidates were controversy about the count of votes, the country was caught in political divisions and social unrest. Honduras maintained close relations with the United States, participated actively in Central-American issues, and made efforts to improve its regional influence.

Keywords:  Honduras; Presidential Election; Demonstration; Honduras-US Relations

 

24.

El Salvador: Ruling Party Powerless to Turn Things Around

Liu Fanping

 

Abstract: In 2017, the political situation in El Salvador was stable and the ruling party suffered from low popularity and a weak position in the Legislative Assembly. Corruption was rampant in municipal governments, the Legislative Assembly and the judiciary branch. Nayib Bukele, mayor of San Salvador, broke with the ruling FMLN. The economy was in stagnation and trade deficit widened, but the inflow of remittances showed a robust trend. The homicide rate dropped slightly. After the abolition of the Amnesty Law, the government proceeded to investigate human rights violations that took place during the civil war. The pension reform came into effect. Salvadorians in the US are facing an increasing pressure of deportation.

Keywords: Weak Government; Corruption; Weak Economy; Homicide Rate; Pension Reform; Immigration Policy

 

25.

Guatemala: President in Governance Crisis

Wang Fei 

Abstract:  In 2017, the president of Guatemala, Jimmy Morales, suffered a crisis in power for corruption scandals and the expulsion of United Nations anti-corruption officials. Under the influence of the crisis, the economic growth of Guatemala slowed last year, the fiscal revenue declined, and the confidence of private investment was damaged. The fiscal tightening policy was successful for two years consecutively, but the financial space was still limited. The rate of inflation was always within the target range, and there was a certain space for monetary policy. The crisis triggered a number of demonstrations, the public's dissatisfaction with the government spread and social instability increased. The expulsion of United Nations officials also damaged the international reputation of Guatemala. Guatemala actively expanded its economic and trade relations with China, which was a highlight in the field of foreign relations in the year of 2017.

Keywords: Guatemala; Governance Crisis; Corruption; Trump Policy

 

26.

Panama: Diplomatic Relations with China Brings New Opportunities

Wang Shuai

 

Abstract: The arrest of Former President Martinelli was a key political event for Panama in 2017, mirroring the two major threads of the corruption scandal and the power struggle in Panama’s politics. All of these are aimed at the 2019 general elections. The economic performance was outstanding with potential vitality unleashed, mainly due to the increase of infrastructure construction and the navigation competitiveness of the newly-expanded Panama Canal. Public security was the biggest concern for the Panamanians. The government increased efforts of rectification and sought international cooperation. The establishment of diplomatic relations between China and Panama made history, providing new and important opportunities for Panama’s faster economic development.

Keywords: Corruption Scandal; Infrastructure; Panama Canal; Security; Establishment of China-Panama Diplomatic Relations

 

27.

Dominican Republic: Economy Grew Steadily, Political Uncertainties Loomed

Shi Peiran

 

Abstract: 2017 is the second year of President Danilo Medina’s second term. Even though Dr. Medina himself, as well as the PLD, emphasized several times that he would not run for the 2020 Presidential Election, Ruling party PLD raised the Open Primaries Initiative, which led to a deepened controversy between PLD and PRM. In terms of economic situation, Dominican Republic remained one of most rapidly developing countries in LAC. The excepted GDP growth, GDP per capita growth and ratio of fiscal deficit to GDP were 5.1%, 3.8% and -2.4%, respectively. CPI was lower than the target rate, the balance of trade deficit was lower than previous year, and the interest rate and foreign exchange rate were all steady. On the social aspect, corruption was the most serious social problem, causing several demonstrations within the year. However, the employment was further improved. Hurricane Irma brought significant damages to the country, yet the death rate was much lower than expected. In the aspect of foreign policy, newly-elected President of Haiti visited Dominican Republic in January and both countries reset bilateral relations in May. In September and December, International mediations to resume on Venezuelan crisis were held in Dominican Republic.

Keywords: Dominican Republic; Open Primaries; Economic Stability; Crisis Meditations

 

28.

Haiti: Domestic Political Situation Gradually Stabilized

Zhao Chongyang

 

Abstract: In 2017, after two years of electoral process, Haiti finally elected a new president and formed a new government. The political situation gradually stabilized. The economic situation kept steady due to the negative effects of the 2016 hurricane "Matthew" and the positive impact of the 2017 agricultural harvest. The overall security situation was stable, but there were hidden destabilizing factors. Haiti’s relations with the UN and the United States were changed with the withdrawal of MINUSTAH from Haiti and the appointment of Donald Trump as U.S. president.

Keywords: Haiti; Political Stability; Steady Economic Situation; MINUSTAH; Haiti–US Relations

 

29.

Caribbean Area: Economy Reviving Slowly, Social Problems Severe

Cao Meng

 

Abstract: In 2017, the Caribbean area seized the opportunities for development and made progress. However, the sustainable development still faces challenges. The political situation was stable, and some general elections have been held successfully. Against the background of world economic recovery, the Caribbean economy also developed. But problems such as serious debt burden and lack of innovation ability still existed. Severe social problems such as crime, unemployment and aging cannot be ignored, and the hurricane disaster made a lot of damage. The Caribbean has made great progress in diplomacy. Regional integration was enhanced, and international organizations provided aid to the Caribbean in many aspects. At the same time, the partnership with China is getting closer, and it is to be sure that the cooperation will be deepened in the future.

Keywords: the Caribbean; Economic Recovery; Social Problems; Regional Integration