Category Archives: Latin America and the Caribbean

Why Free Enterprise Matters for Democracy in Venezuela

By Gustavo Guerrero and Laura Boyette

The economic and political climate in Venezuela today has grown to crisis levels as the government consolidates power and limits the freedoms of entrepreneurs and the private sector through harmful legislation and the nationalization of private businesses. In the face of these challenges, the Federation of Chambers and Associations of Commerce and Production (FEDECAMARAS) continues working hard to advocate for policies that will grow the Venezuelan economy and provide more opportunities to young entrepreneurs, both of which are essential to creating a brighter future for Venezuela. In May Jorge Roig, President of FEDECAMARAS, sat down for an interview with CIPE and discussed the role of the private sector and its advocates in Venezuela.

Roig stressed the importance of cooperation between business, society, and government, saying that without engaging these groups in dialogue, substantive change will not occur. In recent years, the Chávez and Maduro governments have depicted the private sector and organizations such as FEDECAMARAS as the source of Venezuela’s economic problems, claiming they have political aspirations. However, Roig defined the role of FEDECAMARAS very clearly – not to be a political power, but rather to influence it on behalf of entrepreneurs. Furthermore, organizations such as FEDECAMARAS not only protect free enterprise, but also support democratic values and act in the best interests of the society as a whole.

Read More…

Implementation Gaps and Public Information in Argentina

grafico-1

In every country, sound laws are a key foundation of democratic governance and economic development. Crafting such laws, however, is only part of the path to success. The other half is making sure that the laws are properly implemented – which is often more challenging.

When laws and regulations are not properly adopted, such discrepancy creates an implementation gap – the difference between laws on the books and how they function in practice. This gap can have negative consequences for democratic governance and the economic prospects of countries and communities. Failing to fully implement laws undermines the credibility of government officials, fuels corruption, and presents serious challenges for business, which in turn hampers economic growth.

To help better understand why implementation gaps happen and how they can be addressed, CIPE and Global Integrity published Improving Public Governance: Closing the Implementation Gap Between Law and Practice. This guidebook offers starting points for identifying implementation gaps in various laws and regulations, asking why these laws and regulations are not fully adopted or practiced.

Based on the suggestions from the guidebook, the Center for the Implementation of Public Policies Promoting Equity and Growth (CIPPEC) researched whether Argentina’s access to information law is implemented by public entities, particularly by state-owned enterprise. The latest Economic Reform Feature Service article summarizes CIPPEC’s key findings from the research and policy reform suggestions needed to overcome the implementation gap.

Maiko Nakagaki is a Program Officer for Global Programs at CIPE.

No Laughing Matter: Press Freedom in Latin America Takes a Hit

bonil-cartoon

“Police and prosecutors search the home of Fernando Villavicencio and take documentation of corruption.” – Cartoon by Xavier Bonilla, published in El Universo on December 28, 2013.

Read about CIPE’s 2014 Global Editorial Cartoon Competition.

In recent years, Latin America has seen an overall shift away from media independence and freedom of the press – only one in 50 Latin Americans live in free media environments, according to Freedom House, even though the majority of Latin American countries are still democracies. The biggest drop — 15 points in the last five years — was in Ecuador, a clear illustration of the problems that can occur when democratically elected leaders curtail media freedom.

After Rafael Correa took office on a wave of populist charisma in 2007, the Ecuadorian media began to realize that they needed to watch themselves due to various acts against independent media that alleged corruption in the Correa family or the Correa administration. These attacks against press freedom were formally legalized with the Organic Law on Communications, passed in 2012 without open debate in the National Assembly or among civil society.

This law, which Correa lauded as a step toward the democratization of media and a strengthening of freedom of expression as it broke up a near-monopoly of news sources owned by a single family, also opened the door to greater state intervention in the media.

The major concern for media outlets is that many aspects of the law were left ambiguous, allowing for broad interpretation and arbitrary application. For instance, Article 26 of the law prohibits “media lynching” and allows public officials being investigated for corruption by the media to sue the journalist or the newspaper doing the investigating. Article 71 of the law defines information as a “public good” equal to water quality and electricity, and therefore subject to increased regulation by the state.

The most recent case of the Correa administration battling perceived defamation in the media is that of Xavier Bonilla, a political cartoonist known by the pen name Bonil.

Read More…

Venezuela’s Steady Decline

store-empty-shelves

To anyone who has traveled frequently to Venezuela, the deterioration of the country is palpable. By day, people fear driving and getting stuck in traffic because motorcycle thugs will tap on their window, show a gun, and demand the handover of cell phones and cash. By night it is worse: going out on the town could involve robbery, kidnapping, and risk of death, so the streets are empty on Friday and Saturday nights in a city that previously boasted an active nightlife.

Shopping is another sad tale — commercial malls show a lack of maintenance, and stores have little merchandise. The common refrain you hear everywhere is “no hay,” or “there aren’t any.” You hear that when asking for anything from cell phones to toilet paper. You hear it in restaurants, too, where chefs somehow manage to figure out how to cook without basic staples such as cooking oil or flour.

If you can even get an airline ticket to Venezuela—international carriers are prevented from taking their profits out of the country, so they are curtailing flights—you will find prices depend entirely on the exchange rate you are able to obtain. If you change money at official rates you will pay $25 for a sandwich and a cup of coffee. If you are lucky enough to obtain the parallel exchange rate—which is running upwards of 10 ten times the official rate—the same meal will cost you $2.50.

How do Venezuelans cope with living this way? There are significant segments of society that still support the government of Nicolás Maduro despite its inability or unwillingness to tackle the huge economic problems the country faces, and which they have mostly caused.  As the economy worsens, however, it seems unlikely that even the poorest segments of Venezuelan society who supported Hugo Chavez and now Maduro will continue to provide that support.

Read More…

Democracy and Economic Freedom in Venezuela

Recent developments concerning property rights violations and popular riots in Venezuela remind us that democratic and economic development is not always a gradual forward-looking process but instead is characterized by periods of progress as well as setbacks. Separation of powers, property rights, the rule of law, the respect of human rights and the rights of minorities are essential components of a functioning democratic and free market system.

Reflecting on the challenging situation in Venezuela and the business community’s experience of threats to private property rights, Jorge Roig, President of the Venezuelan Federation of Chambers of Commerce FEDECAMARAS, was invited by the Free Enterprise and Democracy Network to share his views in the latest Economic Reform Feature Service article

Read More…

Welcoming Future Business Association and Chamber Leaders

dc chamberlinks participants

Washington, DC area ChamberLINKS participants (from left to right): Frida Mbugua (Kenya), Mariana Araujo (Venezuela), and Nini Panjikidze (Georgia).

This week five young professionals from different countries arrived to the U.S. to partake in CIPE’s ChamberLINKS program. The program, which is taking place for the fifth year, matches rising young stars from chambers of commerce and business associations around the world with similar organizations in the U.S.

This year’s participants and placements include:

For the following six weeks, these participants will shadow senior staff of their host organizations to observe and take part in the daily operations of successful associations.

Through the ChamberLINKS experience, the participants will gain valuable skills such as advocacy, membership development, and events management. At the same time, these international participants will provide their U.S. hosts with intercultural understandings such as insights into how associations operate in other nations.

The program also has a long-term impact because the participants bring back what they learned from their experiences to their home organizations after the program ends. For instance, Kipson Gundani, a 2012 ChamberLINKS program participant, raised funds and created momentum to start several new initiatives at the Zimbabwe National Chamber of Commerce (ZNCC) based on his experience at the Ponca City Chamber of Commerce in Oklahoma. This included internship programs connecting 50 university students with ZNCC members, evening networking events for ZNCC members, and improving the Chamber’s governance systems by making the board selection process more transparent.

Everyone involved in the program –the international participants, the host organizations, and CIPE – are excited to see what the participants will learn from the next six weeks.

Maiko Nakagaki is a Program Officer for Global Programs at CIPE.

Open Government and Public Enterprises in Argentina

Argentina's state oil company, Yacimientos Petrolíferos Fiscales, was privatized in 1993 but partially re-nationalized in 2012.

Argentina’s state oil company, Yacimientos Petrolíferos Fiscales, was privatized in 1993 but partially re-nationalized in 2012.

Access to information is an integral part of an open democracy. The UNDP defines access to information as encompassing the core principles of democratic governance: participation, transparency, and accountability. And the promotion and protection of both access to information itself and flows of information that exists between constituents, government, civil society organizations and the private sector are of equal importance. Yet, in many countries around the world, transparency or access to information laws are not properly enforced.

Argentina is a good example of this. The Access to Information Decree 1172/03, obliges “the bodies, entities, enterprise, companies, dependencies and all other entity that work under the jurisdiction of the National Executive Branch” to provide public information. The Decree defines private organizations as those either receiving subsidies or contributions from the national government. This definition is particularly important because the percentage of the national budget devoted to public enterprises in Argentina has been increasing – in 2006 it was 2 percent and it rose up to 8 percent by 2012. But are these state-owned enterprises abiding by Decree 1172/03?

Read More…