First published June 2012 in Fight Racism! Fight Imperialism! 227
In the context of deepening economic crisis, the US and Europe are losing their grip on Latin America as Cuba and Venezuela strengthen regional ties.
Bullies, blunders and prostitutes
The Organisation of American States (OAS) was founded in 1948 on lofty-sounding ideals including non-interference in the internal affairs of other member states. In reality, it acts as a cover for US imperialist interests in Latin America. The OAS summit held in Cartagena, Colombia, in April reflected this, as the United States once again vetoed Cuba’s attendance. Leader after leader condemned the US veto and Rafael Correa of Ecuador boycotted the meeting in protest. Even staunch US allies Mexico and Colombia demanded Cuba’s inclusion. Countries belonging to the Bolivarian Alliance for the Americas (ALBA) made it clear that without a radical change in the nature of the summits, they would not attend the OAS again. Before President Obama even arrived, his bully boy Secret Service agents were setting the imperialist tone as they were caught taking prostitutes back to their hotel, flaunting their ID cards in an arrogant attempt to get past the reception desk.
The summit ended without a final declaration. Argentina’s Cristina Fernandez and Bolivia’s Evo Morales abandoned the summit early after the United States refused to recognise or even discuss Argentina’s claim over the Malvinas – which Obama in any case confused with the Maldives. Hopefully this catalogue of errors sounds the death knell for the infamous OAS and signifies the decline of US influence in the region.
European interests in Latin America have not escaped unscathed. On 1 May, to commemorate International Workers’ Day, Bolivian President Evo Morales seized the local assets of Spanish power grid operator Red Eléctrica Corp and ordered the armed forces to take over its installations. This came days after Argentina’s move to seize a 51% majority stake in Argentine oil company YPF from Spanish oil major Repsol YPF SA, which had held a 57.4% stake (see article on this page).
The rise and rise of ALBA
The real summit for co-operation and organisation between American states took place in February in Caracas as ALBA marked seven years of mutual development and regional integration. Created in 2004 by Venezuela and Cuba as a direct alternative to the OAS-driven Free Trade Area of the Americas, ALBA is currently made up of Bolivia, Antigua and Barbuda, Dominica, Ecuador, Nicaragua and Saint Vincent & the Grenadines. Honduras was a member until the 2009 US-backed coup. Providing a concrete alternative to over a century of US exploitation and plunder, ALBA is a political and economic alliance based on the principles of self-determination, solidarity, social justice and complementary economic planning for sustained integration. Using the human resources of socialist Cuba and nationalised oil revenues from Venezuela, ALBA has eradicated illiteracy in Venezuela, Bolivia, Nicaragua and Ecuador, provided free eye surgery for over 17 million people and set up free health care in six of the affiliated countries. The alliance has created its own bank which finances local development and social projects without imposing conditions – unlike the predatory loans pushed by the IMF and World Bank. It has developed the SUCRE, a virtual currency that allows countries to trade without reliance on the US dollar. In 2011 a total of 431 SUCRE transactions were carried out between ALBA countries, amounting to over $216 million worth of trade.
ALBA set to grow in the Caribbean
ALBA is also challenging the US in the Caribbean. In 2006, 13 of the 15 countries in the Caribbean Community and Common Market (CARICOM) signed up to PetroCaribe, a Venezuelan initiative that provides discounted oil and social investment. Born out of the 2004 trade agreement whereby Cuba (excluded from CARICOM) provided health and education workers to Venezuela in return for subsidised oil, PetroCaribe requires contracting countries to only pay a percentage of the market price, with the remaining cost converted into long-term, low-interest loans which can be paid back in goods and services to Venezuela. Dominica joined ALBA in 2008 and since then has received $44 million for projects in housing, infrastructure, security and agriculture. Antigua, a member since June 2009, has received assistance to refurbish the VC Bird International Airport, and $8 million to finance a major water infrastructure project. In addition, during 2011 Antigua and Barbuda had 125 students on scholarship in Cuba. Saint Vincent & the Grenadines also joined ALBA in 2009 and have been granted over $10 million by Venezuela to finance housing for low-income families, in addition to grants for rural development projects. Today PetroCaribe includes 18 countries with only Trinidad and Tobago, and Barbados, close allies of the US, remaining outside the project.
In stark contrast to centuries of colonialism followed by US-backed coups and exploitation, ALBA has been a beacon of solidarity in Haiti, playing a vital role following the devastating earthquake in 2010. Cuban medical brigades have been working in Haiti since Hurricane George in 1998 and Haitian medical students have been studying on scholarships in Havana’s Latin American School of Medicine since 1999. By 2007, Cuba was providing 75% of Haiti’s health care: infant mortality dropped from 80 per 1,000 live births to 33 and life expectancy increased from 54 to 61 years. In 2007 Venezuela funded agreements including $80 million for an oil refinery, $56 million for three electricity plants, $4 million for a liquid gas plant, and $3 million for a waste collection programme. Following the earthquake Venezuela cancelled all of Haiti’s $400 million debt with PetroCaribe and pledged $2.4 billion in reconstruction and relief aid. Furthermore, the February 2012 ALBA summit produced a ‘roadmap’ for sustainable reconstruction focusing on building infrastructure and increasing independence in energy, agriculture, health care and education in Haiti.
The distinction couldn’t be clearer. On the one hand we have US-led initiatives in the region, pushing free trade, monopoly capitalism, military bases and sweatshops whilst paying lip-service to development, freedom and democracy. On the other, ALBA and the recently created Community for Latin American and Caribbean States (CELAC) have already demonstrated their outstanding commitment to meeting the needs of people south of the US border. It is little wonder that in the last few months, St Lucia and Suriname have begun the political process towards joining ALBA and Haiti has formally become a permanent observer. The remaining countries still in the pocket of the US are finding themselves more and more isolated in a sea of anti-imperialist solidarity, pioneered by the example of socialist Cuba.
The increasing importance of China
Latin American countries struggling against US economic domination of the region are increasingly beneficiaries of China’s developing drive to secure new markets and resources at the expense of the US. China is displacing the European Union as the second-largest trade partner of countries in Latin America and the Caribbean and is rapidly becoming the region’s third-largest investor. In 2011 China’s trade with Latin American and Caribbean countries exceeded $245 billion, up by 32% on 2010. Non-ALBA members Brazil, Chile and Argentina account for 77% of Latin American exports to China, but agreements with Venezuela and Cuba are also becoming significant. The China-Venezuela Fund created in 2007 now contains $32 billion and funds 160 socio-productive projects in Venezuela – the highest amount of Chinese financing in any Latin American country. Exports of Venezuelan oil to China have increased from 45,000 barrels per day (BPD) in 2005 to 410,000 bpd in 2011 with plans to increase this to one million in the next few years. Trade between the countries is now worth $17 billion per year. In 2011 China signed accords to invest $500 million in Cuba’s nickel industry and is Cuba’s third largest trading partner, with Cuba providing half of China’s nickel. On 13 May China signed a $3 million agreement with the Bolivian armed forces to develop communication equipment.