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1,400 | <s>[INST] Already, many external Mercosur tariffs, which [/INST] average 14%, are lower than they were before the group's creation. </s> |
1,401 | <s>[INST] And the entire hemisphere, except Cuba, agreed [/INST] in 1994 to negotiate a Free Trade Area of the Americas by 2005. </s> |
1,402 | <s>[INST] "We knew when we joined Mercosur that we'd have [/INST] to buy more expensive refrigerators coming from Brazil than ones coming from the U.S.," the diplomat says. </s> |
1,403 | <s>[INST] "But in the medium term [/INST] I think Mercosur will be more open". </s> |
1,404 | <s>[INST] (See related letter: "Letters to the Editor: [/INST] Brazil Isn't to Blame For High Auto Tariffs" -- WSJ Nov. </s> |
1,405 | <s>[INST] ___ Document 167 of 400 Gestures against reform [/INST] Author: Anonymous Publication info: The Economist 341.7994 (Nov 30, 1996): 19-21; UK 25-29. </s> |
1,406 | <s>[INST] accountid=28034 Abstract: The rise of the People's Revolutionay Army in Mexico [/INST] is a small but worrying part of wider regional reaction against the new generation of free market refomers in Latin America. </s> |
1,407 | <s>[INST] The great expectations that accompanied [/INST] their bold reforms have come crashing down. </s> |
1,408 | <s>[INST] Unemployed and angry voters have looked to [/INST] populists only to find the easy solutions they offered also disappear. </s> |
1,409 | <s>[INST] The resulting disgust with all politics is [/INST] coinciding with rising violence of all kinds, from guerrilla action to crime. </s> |
1,410 | <s>[INST] This rising discontent represents the [/INST] greatest challenge yet faced by the continent's reformers. </s> |
1,411 | <s>[INST] They are looking for new ways to [/INST] encourage growth and speed up the delivery of its social benefits. </s> |
1,412 | <s>[INST] Full text: Headnote In dribs and drabs, a populist reaction is gathering pace against [/INST] the bold freemarket reforms of Latin America BEFORE Eastern Europe, Latin America was the region that first saw the ascendancy of free-market democrats over authoritarian protectionists. </s> |
1,413 | <s>[INST] In just a decade, well-educated, market-minded civilians arrived in [/INST] power everywhere (bar Cuba), shoving aside the protectionists and brass-hats who had long run the place. </s> |
1,414 | <s>[INST] In some countries radical free-marketeers have been in [/INST] charge (Argentina, Mexico); others have been run by more gradualist reformers (Brazil, recently Chile). </s> |
1,415 | <s>[INST] But everywhere, the direction of policy [/INST] has been the same: to chop back the over-mighty state. </s> |
1,416 | <s>[INST] And everywhere, the results have been [/INST] similar: inflation is down; foreign investment is up; dictatorships are out. </s> |
1,417 | <s>[INST] Yet (as in much of [/INST] Eastern Europe) the liberal ascendancy stopped short of triumph. </s> |
1,418 | <s>[INST] From the rugged sierras outside the Mexican resort of Acapulco, [/INST] the People's Revolutionary Army (EPR) has been running a vicious bombing campaign in half a dozen states. </s> |
1,419 | <s>[INST] Maximo Gomez, the priest of Atoyac de Alvarez, [/INST] a scrubby town in rebel country, thinks that "go% support the guerrillas in their heart. </s> |
1,420 | <s>[INST] if the government does [/INST] not act soon, this place will explode". </s> |
1,421 | <s>[INST] The rise of the EPR is a small [/INST] but worrying part of wider regional reaction against the new generation of free-market reformers. </s> |
1,422 | <s>[INST] The great expectations that accompanied [/INST] their bold reforms have come crashing down. </s> |
1,423 | <s>[INST] Unemployed and angry voters have looked [/INST] to populists-only to find the easy solutions they profferred also disappear. </s> |
1,424 | <s>[INST] The resulting disgust with all politics is [/INST] coinciding with rising violence of all kinds, from guerrilla action to crime. </s> |
1,425 | <s>[INST] This rising discontent represents the [/INST] greatest challenge yet faced by the continent's reformers. </s> |
1,426 | <s>[INST] Earlier this month, he got the annual summit meeting [/INST] of Latin American and Iberian leaders to focus on "governability for efficient and participatory democracy". </s> |
1,427 | <s>[INST] In plain English, rulers too [/INST] are frustrated by the pace of reform. </s> |
1,428 | <s>[INST] They are looking for new ways to [/INST] encourage growth and speed up the delivery of its social benefits. </s> |
1,429 | <s>[INST] Given the sweeping nature [/INST] of the reforms, that is hardly surprising. </s> |
1,430 | <s>[INST] For decades, Latin America was [/INST] mired in state controls, bouts of hyperinflation and slump. </s> |
1,431 | <s>[INST] Hope dawned in the late 1986s, when a new generation of brash, foreigneducated leaders embraced the [/INST] so-called "Washington consensus", a heady mix of privatisation, financial liberalisation and trade reform which sought to balance the books and end the power of a corrupt and paternalistic state. </s> |
1,432 | <s>[INST] Despite bumps along the way-most notably [/INST] Mexico's currency and banking troubles of 1994-95-the gains are undeniable. </s> |
1,433 | <s>[INST] One is the slaying of inflation, that most insidious of [/INST] taxes on the poor, which fell from a regional mean of 196% in 1991 to just 19% last year. </s> |
1,434 | <s>[INST] Fiscal discipline has slashed the average budget [/INST] deficit by twothirds, from 5.5% of GDP in 1988 to 1.8% in 1995. </s> |
1,435 | <s>[INST] Protectionist barriers have tumbled unilaterally or as part [/INST] of accords which doubled intra-regional exports to $32 billion in the five years to 1994. </s> |
1,436 | <s>[INST] NAFTA, the North American Free-Trade Agreement, [/INST] has linked Mexico with the giants to its north. </s> |
1,437 | <s>[INST] In South America, Mercosur is [/INST] edging Argentina, Uruguay, Paraguay and Brazil the same way. </s> |
1,438 | <s>[INST] In December 1994, Latin leaders pushed the United [/INST] States and Canada to agree to negotiate a Free-Trade Area of the Americas by 2005. </s> |
1,439 | <s>[INST] The opening of the region's economies has spurred exports; [/INST] they grew 6% a year during the early 199os, up from 1.8% a year during the mid-198os. </s> |
1,440 | <s>[INST] This first wave of [/INST] reform was popular, as liberalisation boosted growth. </s> |
1,441 | <s>[INST] Along came an expansion of credit and a flood of [/INST] cheap imports, which pleased consumers, and propelled reformers such as Peru's Alberto Fujimori and Argentina's Carlos Menem to re-election. </s> |
1,442 | <s>[INST] They were liked not because they laid a foundation [/INST] for a far brighter future than had seemed possible during the "lost decade" of the 198os. </s> |
1,443 | <s>[INST] Rather, voters liked reform because [/INST] it was accompanied by spurts of growth. </s> |
1,444 | <s>[INST] Alas, these boomlets were not "the pay-off [/INST] for reform", as Ricardo Hausmann of the Inter-American Development Bank (IDB) argues. </s> |
1,445 | <s>[INST] Rather, many of them were fuelled partly [/INST] or largely by one-off inflows that resulted from the return of stability. </s> |
1,446 | <s>[INST] In Mexico and Venezuela short-lived booms ended in banking crises; [/INST] Brazil's boom escaped that, but not by much; Argentina's was killed by sudden monetary contraction after the Mexican crisis. </s> |
1,447 | <s>[INST] What they see is that the [/INST] region's traditionally wide gap between incomes is widening further. </s> |
1,448 | <s>[INST] The reforms of the early 1990s did reduce the percentage [/INST] in poverty, but population growth ensured that the absolute number soared (see chart i on previous page). </s> |
1,449 | <s>[INST] The reforms have not yet delivered [/INST] the kind of sustained growth needed to wipe out poverty. </s> |
1,450 | <s>[INST] True, the region's GDP grew [/INST] 3.5% in 1991 after the reforms started. </s> |
1,451 | <s>[INST] From about 3% this [/INST] year, it may reach 4% next year. </s> |
1,452 | <s>[INST] Many economists reckon growth of 6% [/INST] will be needed to reduce poverty as populations continue to rise. </s> |
1,453 | <s>[INST] A year ago, Shahid Burki, until recently the [/INST] World Bank's top Latin America man, thought regional growth might reach 6% soon. </s> |
1,454 | <s>[INST] In a candid and controversial assessment, he argued that [/INST] the ripple effects of the Mexican crisis have exposed the fragility of banks from Mexico to Argentina. </s> |
1,455 | <s>[INST] He worries that it will take another [/INST] decade to achieve a stable growth rate of 6% or so. </s> |
1,456 | <s>[INST] In recent months, the golden boys [/INST] of reform-Messrs Menem and Fujimori-have seen their popularity plummet. </s> |
1,457 | <s>[INST] Everywhere, polls show citizens have an [/INST] exceptionally low opinion of politicians and parties (see chart 2). </s> |
1,458 | <s>[INST] What seems to be happening is [/INST] that middle-class folk are joining the backlash of the poor. </s> |
1,459 | <s>[INST] A remarkable revolt took place at a recent assembly of [/INST] Mexico's ever-ruling Institutional Revolutionary Party (PRI) Furious that unpopular market reforms had resulted in electoral defeats, hardliners rebelied. </s> |
1,460 | <s>[INST] rang the cries as they voted [/INST] to stop privatisation and ban technocrats from high office. </s> |
1,461 | <s>[INST] Middle-class anger at cuts in utility and [/INST] energy subsidies helped drive Venezuela's Carlos Andres Perez from office in 1993. </s> |
1,462 | <s>[INST] And Nicaraguans were so disgusted with six years of IMF-encou [/INST] raged reform that nearly 40% (on the official count) voted for the ex-Marxist Sandinists in the recent election. </s> |
1,463 | <s>[INST] The Sandinists did not win [/INST] the election, but the warning was plain. </s> |
1,464 | <s>[INST] In Mexico, the reaction against reform was led by the dinosaurs of the PRI, who, [/INST] if their record in office in the 1960s and 1970s is any guide, are more likely to stuff their pockets once in power than to help the poor. </s> |
1,465 | <s>[INST] In more pluralistic countries, the backlash [/INST] is no more likely to lead to leftward policy shifts. </s> |
1,466 | <s>[INST] Alvaro Vargas Llosa, the son of Mario Vargas Llosa, a Peruvian [/INST] writer and defeated presidential candidate in 1990, explains why in a controversial book, "The Idiot's Guide to Latin America". </s> |
1,467 | <s>[INST] The left, he says, blames the [/INST] CIA, multinational companies and the IMF for the revion's woes. </s> |
1,468 | <s>[INST] Leftist leaders have not come up [/INST] with any coherent alternative to the prevailing free-market agenda. </s> |
1,469 | <s>[INST] Old-style populists are no better [/INST] at defusing voters' discontent, though for a different reason. </s> |
1,470 | <s>[INST] Venezuela's Rafael Caldera portrayed himself as [/INST] an outsider who would end unpopular reforms; he won in 1993. </s> |
1,471 | <s>[INST] In Ecuador, the populist to end all populists, Abdala [/INST] Bucaram, swept into of fice last July with a campaign featuring rock CDs, strippers and pork-barrel politics. </s> |
1,472 | <s>[INST] Mr Caldera is now implementing IMF-style reforms, while [/INST] Mr Bucaram has taken advice from Domingo Cavallo, the architect of Argentina's reforms. </s> |
1,473 | <s>[INST] Enter the caveman The resulting victory [/INST] of sound policies over populism is good news for the economy. </s> |
1,474 | <s>[INST] It may give the policy [/INST] reforms a little more time to work. </s> |
1,475 | <s>[INST] But if so, the extra time [/INST] may be bought at the expense of further political disillusion. </s> |
1,476 | <s>[INST] Guerrilla insurgencies, which many thought would subside [/INST] with the Central American civil wars of the 1980s, are back. </s> |
1,477 | <s>[INST] Colombia, where peace had seemed not far out of reach a year ago, has seen guerrillas [/INST] unleash attacks of such fury that some compare the past few months to the early days of la violencia, the terrible civil war of the 1950s which claimed nearly 300,ooo lives. </s> |
1,478 | <s>[INST] Peru's Shining Path has shown, through recent horrific attacks, [/INST] that the capture of Abimael Guzman, its mastermind, has not dealt it a death blow. </s> |
1,479 | <s>[INST] Mexico has both the telegenic masked Zapatists and the EPR [/INST] the "cavemen of the left", as Denise Dresser, a Mexican political scientist calls them, roaming the countryside. </s> |
1,480 | <s>[INST] It is easy to dismiss this-as [/INST] some officials do-as merely a tale of bandits in remote regions. </s> |
1,481 | <s>[INST] Certainly, guerrilla violence is nothing like [/INST] as bad as it was in the 1960s and 1970s. </s> |
1,482 | <s>[INST] Nor are guerrillas any longer the [/INST] proxy warriors of a cold war fought in Uncle Sam's backyard. </s> |
1,483 | <s>[INST] Yet if their ideology does not [/INST] amount to much, their willingness to resort to violence does. </s> |
1,484 | <s>[INST] For guerrilla activity is just [/INST] part of a much broader escalation of violence. </s> |
1,485 | <s>[INST] Nearly every city in Latin America is [/INST] more dangerous today than it was ten years ago, before the reforms began. </s> |
1,486 | <s>[INST] The region's murder rate, already six [/INST] times the world average, is surging (see chart 3). </s> |
1,487 | <s>[INST] Kidnappings are rife; half of all the world's abductions take place [/INST] in Colombia, where rich and poor pay a combined total ransom of $100m a year to get their loved ones back. </s> |
1,488 | <s>[INST] The root causes of violence are complex, ranging from [/INST] drug trafficking and consumption to income inequality, mega-cities without services, and corrupt police and courts. </s> |
1,489 | <s>[INST] But, according to Luis Ratinoffofthe IDB, discontent [/INST] with the political order has contributed to the recent spurt in violence. </s> |
1,490 | <s>[INST] He thinks that the demise of traditional purveyors of hope-from radical [/INST] clergymen to Utopian parties and trade unionsmeans that those frustrated by the reforms may be more willing to resort to violence. </s> |
1,491 | <s>[INST] Even in Mexico, traditionally one of the region's more peaceful countries, [/INST] a poll by a daily newspaper, Reforma, showed that nearly a third of the population believes armed violence is justified. </s> |
1,492 | <s>[INST] Institutional breakdown Contributing to this strain [/INST] on the rule of law is the weakness of institutions. </s> |
1,493 | <s>[INST] With few exceptions, courts are inefficient and [/INST] corrupt; in many countries, policemen and former policemen engage in murder. </s> |
1,494 | <s>[INST] The spiral of violence has produced a spiral of [/INST] spending on private security, which often contributes to more crime, as private armies turn into paramilitary squads. </s> |
1,495 | <s>[INST] All told, the region spends an [/INST] astonishing 13-15% of GDP on security expenses (both private and public). </s> |
1,496 | <s>[INST] The rich and the middle [/INST] classes maybe able to afford this for a while. </s> |
1,497 | <s>[INST] In the past few months, there have [/INST] been televised lynchings of suspected criminals by villagers in Ecuador, Mexico and Guatemala. </s> |
1,498 | <s>[INST] The army has been [/INST] given special powers in chunks of Colombia. </s> |
1,499 | <s>[INST] Over a dozen of Peru's [/INST] departments have been under army rule for years. </s> |
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