Saturday, November 1, 2008

The Government of Evo Morales and the Fight Against Cocaine

Today at Chimoré, Cochabamba, Evo inspected the troops that have
cleared 5000ha of coca plantations from Bolivian soil this year
and announced he was kicking out the DEA


The US government is trying to paint the Bolivia of Evo Morales as some sort of friend to the Cocaine business and enemy of....well everything, really. So riddle me this one:

Bolivia's Special Force to Fight Cocaine (FELCN) is the body in charge of fighting drug trafficking. Here's a list of its cocaine seizure tonnages for the first 10 months of the years 2005 to 2008:

2005: 11.3 metric tonnes (MT) of cocaine/coca paste seized by FELCN
2006: 14.0 metric tonnes (MT) of cocaine/coca paste seized by FELCN
2007: 14.8 metric tonnes (MT) of cocaine/coca paste seized by FELCN
2008: 25.5 metric tonnes (MT) of cocaine/coca paste seized by FELCN

This isn't some list of made-up numbers. We are talking documented seizures by a bunch of brave police officers that are up against very organized armed gangs.

Next productive acreage:
2000: 14,000 hectares
.
.
2004: 27,700 hectares
2005: 25,400 hectares
2006: 27,500 hectares
2007: 25,000 hectares
2008: 22,000 hectares

These are the official numbers, but it's widely assumed that in Bolivia there are around 5,000 extra hectares to add to each year's total. This means that, according to the International Crisis Group's 2008 report "Latin American Drugs I: Losing the Fight" (a copy available from Otto on request) there is around 100MT of potential cocaine production in Bolivia in 2008, if you subtract the 12,000 hectares of coca that is grown for traditional uses such as chewing, infusions and ceremonies.

This means that, roughly, Bolivia is producing around 100MT of cocaine and 25.5MT of it gets seized, which compares, for example, with Peru's potential production of 300MT, its probable production of 196MT (according to the UN) and its 25MT of cocaine seizures this year. Don't even get me started on the world's number one player Colombia, responsible for over 60% of the world's cocaine (maybe 750 to 800MT right now, of which only a tiny fraction gets seized).

Ready for the big finale? Evo Morales became President of Bolivia on January 22nd 2006. Yep, that's right; since Doctor Morales assumed the presidency cocaine production acreage has dropped by 20% and cocaine seizures have more than doubled. We do hear from the UN that absolute cocaine production rose 5% in Bolivia last year, even though hectares under cultivation dropped. This because the narcos are using more intensive farming techniques and hybrids that produce more alkaloids. However in the same period Colombia's cocaine production rose by no less than 27%! And remember, this is the country that the USA has donated U$6.7Bn to for its "Plan Colombia" war on drugs this decade (Colombia now has 50% more area under cultivation since 2000). But back to Bolivia, and if cocaine production goes up about 5MT in a year and cocaine seizures go up by 10.7MT in the same period, doesn't that mean Evo Morales is winning the war on drugs in his little patch?

No wonder Evo is kicking out the DEA; wherever they go drug production increases, and wherever they leave it goes down. For another example, check out the enormous drop in heroin production in the far eastern golden triangle in the brief period when the Taliban had control, and look at the production figures since the DEA got back into town.

I wonder why...........

People of Spain: Please buy Jose Luis Rodriguez Zapatero a new suit

HAHAHAHAAAAAAAAAAAAAAAAAAAAAAAAA!!!

(click to enlarge and get a better look at my stupid comments)

Otto "WannabePerezHilton" Rock has got his hands on a hi-res version of that silly photo world leaders always do on steps outside conference halls. This one was at the 18th Iberoamerican Summit in El Salvador earlier this week. Click on the photo to see the big version and a few of my silly comments (and note that Evo is the only brown face among them.....let's cut the crap and face facts; it's basically why the North is so scared of him), but the one to zoom in on is the guy on the right.

That picture of elegance is José Luis Rodriguez Zapatero, Prime Minister of Spain. But if we zoom in further........

......we can see that the political head of Spain is wearing a dog's dinner rather than a suit. Jeesh, that thing wouldn't look good on Enrique Iglesias, let alone stick-man Rodriguez. And by zooming in even further....

..... and then twiddling with brightness and contrast (Otto's been having fun with Microsoft Picture Manager this afternoon)......

.........we can see the stitching is coming undone and it's all frayed at the edges. No wonder Kingy banished him to the edge of the photo and refused to stand next to him; I'd choose Michelle Bachelet as a photo-neighbour every time, too.

PEOPLE OF SPAIN....FEEL SHAME!


YOUR GLORIOUS LEADER IS A SARTORIAL WASTELAND!

Are oil companies wealthy, or is South America poor? Or both? Or neither?

Between July 1st and September 30th, combined revenues at Exxon Mobil (XOM), ConocoPhillips (COP) and Chevron (CVX) were U$288Bn.

Between July 1st and September 30th, the estimated* combined GDPs of Argentina, Bolivia, Chile, Colombia, Ecuador, Paraguay, Peru, Uruguay and Venezuela were U$278.7Bn.

Three oil companies generate more wealth than all of Spanish speaking South America. (i.e. the bit without Brazil). To be honest I don't know whether it's good or bad or whatever, but it does give some context. Interesting factoid, no?

3q08 Estimated GDPs (U$Bn)
Argentina 70.2
Venezuela 63.8
Colombia 46.3
Chile 44.2
Peru 29.4
Ecuador 11.9
Uruguay 6.2
Bolivia 3.6
Paraguay 2.9
Total 278.7


3q08 Oil Co. Revs (U$Bn)
CVX 78.9
XOM 137.7
COP 71.4
Total 288.0


*Calculated by taking the IMF official GDP numbers for 2007 (exchange rate) and adding a blanket 8% for average regional growth. This blanket admittedly underestimates some countries (e.g. Peru, Argentina) but overestimates others (e.g. Chile, Ecuador)

Mercado Libre (MELI) is offline...probably not good for business, all things considered

Geddit?

Word reaches slow-off-the-mark Otto that Mercado Libre (MELI) has had an enormous glitch in its operational software for the last three days and the whole site is down. MELI has some kind of "we're doing maintenance work" BS notice up but according to unofficial mails sent out from inside the company the shitstorm is due to head office making a mess of incorporating clients from the recently bought deremate dot com.

From here MELI has two choices:

1) Get the problem sorted out quickly. Three days is far too long already.

2) Pay severe consequences.

As I said just yesterday, the stock is cheap right now but it's not the perfect company. Case in point. Thanks to reader FC for waking me up to this one. I should have known about this earlier, really.......

Good weekend reading from a respected sistasite

This weekend the recommendation is just one site. Memory In Latin America has been on top form all this week so there's not one single post to pick out; the best way to enjoy Lillie's blog is to start right at the top and scroll down. Here's the link to get there.

It really is a top blog, and if you want to do more than just surface-scratch Latin America put it on your list of required reading. Lillie does such a great job in collating and presenting information for the English-speaking world and even though some of the links handed out by her are by necessity in Spanish you will always get good context before you're sent there.

Go read Memory in Latin America this weekend. Bob Marley said it best.

"If you know your history, then you will know where you're coming from."

Otto's weekend freestuff


Here we are, back with the free weekend downloads and interesting stuff for nothing section. There's something for all (ok, most) tastes, so dig in dudettes and dudes.

Free E-Book; Reminiscences of a Stock Operator. I'm putting this link up again because if just one more person out there takes advantage, downloads and reads this it'll be well worth it. The best book on stock investment ever written.

Free White Paper Report; Engaging With The New E-Learning. Adobe (yep, the clever guys who do Acrobat) offers this white paper that gives 12 smart ideas on how to engage and retain learners online. As a secondary reason to get your copy, if you go for this one I get a small commission from the people out there. Help an Otto this weekend? (USA and Canada residents only on this one, I'm afraid).

Amnesty International's report on Colombia named "Leave Us In Peace". If you've ever wondered why people are continually up in arms about so-called human rights abuses in the land of Uribe, read this and you'll extract the "so-called" from that sentence.

Free report on the Commodities sector. Want to read the kind of stuff read by the industry? Here's a report dated 13th October from Macquarie that shows the state of play in the base metals sector, with plenty of data about supply, demand and all that wonky stuff people like me enjoy. At 13 pages it's not too heavy and it's full of useful charts, too.

Free NOBS report on Metanor. Yep, I'm still trying to drum up interest in my online analysis service, and here's the freebie access page again.

Ecuador news roundup

Rafa seen out with Bina last weekend

Let's all feign surprise: The US Central Intelligence Agency had "full knowledge" of the deadly Colombian raid March 1 on a FARC rebel camp inside Ecuador that led to a rupture in ties between Bogota and Quito.

Crisis what crisis? Ecuador's FinMin sez the country will grow 4% to 5% in 2009. Otto sez "believe that one when I see it".

The much delayed mining law is going to the lawmakers next week. Word is that Ecuador is now treating the matter as "a priority", but that word needs more than just a literal translation when transferring it from latino to anglosaxon mentality.

As for the oil sector, Studmuffin keeps on playing the hardball. The latest target is Repsol (REP) of Spain and he says that because REP and Ecuador can't come to an agreement on its local production it's end-of-contract-adios-amigos time.

But I've saved the best til last: Studmuffin got his dos centavos in about the world financial collapse and I agree with everything he said on this one.

"One of the few good things to come out of this crisis is that we don't have to put up with those yuppies of Lehman Brothers, Standard & Poors and JP Morgan. When I was minister, it was unbearable to have a line of those kids asking for an appointment so that I could do their job. They'd ask you for your analysis and then present it in a report as if were their own."

YAY....you still rock, Rafa.