Canning Insights

First steps by the Alfonso Prat-Gay team

Threats turn to action as Brazil begins impeachment process

After months of tortuous political uncertainty, an impeachment process will begin against Brazil’s President Dilma Rousseff. Eduardo Cunha, the speaker of the federal lower chamber of congress and fierce opponent of Rousseff, finally took the plunge on 2 December and went ahead with what he has long threatened. What appears to have pushed Cunha over the edge is the increased likelihood that he himself will be stripped of his post for lying to congress. On the face of it, the impeachment process is unlikely to succeed, but whatever the ultimate outcome the proceedings mean congress will be focused more on Brazil’s political crisis than on its increasingly disastrous economic performance.

Macri triumph heralds biggest regional power shift in a decade

Mauricio Macri will become president of Argentina on 10 December ending 12 years of Kirchnerismo. The economic, political and social implications of Macri’s run-off victory against Daniel Scioli on 22 November are enormous. Macri is promising a profound economic reform, the removal of exchange rate controls, and the restoration of credible institutions. Move too fast and he will face social unrest; too slow and he will face political discontent. The scale of the economic challenge will be all the greater because of the political challenge confronting Macri. The big power shift in Argentina was only at the executive level. Even if he succeeds in keeping his loose Cambiemos coalition together, Macri will have a minority in both chambers of congress where a hostile Kirchnerismo will remain the dominant force.

One to watch: the dollar on 10 December

Ecuador’s Correa turns protests on their head

Ecuador’s President Rafael Correa dropped a bombshell this week by suggesting that the constitutional reform to allow indefinite presidential and legislative re-election which is about to be debated by the national assembly could include a special provision barring him from running again in February 2017. Correa made the announcement against the backdrop of national protests, the sixth against his government so far this year, and with the prospect of at least two more to come, including a general strike, before the year is out. There is no shortage of detractors convinced that this is a tactical move by Correa calculated to distract attention from and undercut support for the disparate protest movement (the unifying theme behind which is opposition to re-election reform). But Correa could be prepared to take a brief break from politics and return in 2021 when the global economic scenario is more favourable.

Mexico: marijuana, Castro and the US

It is not very long ago that the US federal administration would have expressed displeasure at two significant developments south of the Rio Grande this week. On 4 November Mexico’s supreme court of justice [SCJN] handed down a landmark ruling that paves the way for the legalisation of marijuana; the very next day Mexico’s President Enrique Peña Nieto received his Cuban peer Raúl Castro for a three-day official visit, his first since taking over from his brother Fidel in 2006, and proceeded to heap praise on the Cuban government’s achievements while making no reference to anti-democratic and human rights concerns. It would be a mistake to view either development entirely through the prism of US-Mexico relations, but there is no doubt that the legalisation of marijuana in certain US states and the US rapprochement with Cuba played a part.