Dark Matter Politics a blog discussing the unseen forces influencing culture and politics in the Americas.

Lights Out! Natural gas crisis in Chile

 

Chile receives 70 percent of Argentina's natural gas exports, which go to electrical plants, and cover 37 percent of the country's electricity demand. On April 1, 2007 Argentina decided to reduce its supply of natural gas to Chile by 14 percent - around 2.3 million cubic meters daily. The cut seriously affected the Antofagasta and Atacama regions in the north of the country, which do not have hydroelectric energy sources. The cuts disrupted the regions large mining base, including Chiquicamata, the world’s largest open copper mine. The national copper corporation, Codelco Chile announced they would use diesel to alleviate the natural gas deficit.

The flow of natural gas from Argentina in 1997 came as a blessing for Chile as wholesale prices where considerably lower than other energy sources. However with supply lines being threatened the Chilean government has to seriously examine its energy policy as a net importer of energy.

For decades the Chilean government has realized the importance of energy to support economic growth. In 1997 the Gas Andes pipeline was completed, connecting Argentina's Neuquina basin with Santiago. In 1999, two gas pipelines, the Gas Atacama and the NorAndino pipelines, were completed linking Argentina's Northwest basin to the mining regions in the north of Chile. Although progress has been made by various administrations most notably in the development of hydropower, Chile is now at a cross roads with its energy policy.

History teaches us long term social progress in Chile need to be aligned with long term energy sustainability. How can the Chilean government aim to alleviate poverty without securing the energy to mobilize its industries - which in turn generate employment and exports to fund expenditures in social programs? History also teaches us politicians grapple with decisions that do not provide tangible results during the tenure of their administration. The Chilean government could for example allocate a portion of the surplus from copper exports to fund new energy initiatives. While this might not be a popular decision in the short term it could ensure the long term energy security of the country.

Intertwined with economic and social factors is the issue of environmental protection; making a viable energy policy challenging for any administration. According to forecasts by the International Energy Agency, Latin America will need $1.3 billion in new investments in the energy sector by 2030 in order to deal with increased demand. The reality is that the large majority of that investment will be privately funded.

While Chile can develop a sound energy policy it is impacted by the decisions of its neighbors. Case in point, in May 2005, Bolivia’s Congress approved a new Hydrocarbons Law that levies an additional 32 percent tax on oil and gas production at the wellhead, on top of the existing 18 percent royalty. This has been a controversial decision that divides public opinion. Is the protection of a nations’ natural resources comprise its potential net benefit by disincentivising investment aimed at increasing capacity, efficiency and distribution?   

While hydroelectric and gas provide the large majority of Chile’s energy supply, there is significant opportunity for the development of wind, solar, biomass, agro-fuel, wave and geothermal based energy. 

Wind.  There is only one wind energy plant is in operation in Chile. “Alto Baguales” owned by Empresa Electrica de Aysen is situated in the South of Chile, provides 19,000 families with energy. Companies including Pacific Hydro (Australia) and Meridian Gold (Canada) are proposing projects totalling US$678 million.

Solar. While the north of Chile is probably one of the most suitable places for the exploitation of solar energy applications, it’s use in Chile is restricted to local applications because of the high cost associated with this technology.

Biomass.  Biogas projects in Chile have been associated to landfill operations whereby the biogas is extracted from their sites, processed and sold in portable tanks. The use of bio-digesters has been extensively used in swine farms to lower methane emission, re-use the methane and generate carbon credits sold on the international CER (Certified Emission Reductions) market.

Agro-fuel. The Chilean government’s Innovation Agriculture Fund (FIA) will assign US$1 million to agro-fuel investigation and to develop/adapt technologies to produce agro-fuels in Chile. However the logistics of implementing sustainable afro-fuel are considerable. In order to produce the 300,000 cubic meters of ethanol required to replace 10% of gasoline, Chile requires to cultivate an additional 62,500 hectares of corn (now, 100,000 hectares are cultivated for human consumption and animal feed).

Wave.  Chile’s 4, 200 kilometers of coastline and geography offers a perfect setting for tidal and wave technologies. Despite these conditions, any efforts to develop this technology have been limited by the lack of incentives and regulations to encourage its development.

Geothermal.  Geothermal capacity in Chile is outstanding but drilling and prospecting costs are high. Law 19, 657 of the Ministry of Mines and Energy regulates the concession process.

Military Expenditure in Chile

In response to feedback from our article Evo Morales "Gas War" in Bolivia: Implications for South America we have taken a closer look at the "military and nuclear card" in South America and its role once the "age of cheap energy" is over.

Based on figures from the CEPAL and the IMF military expenditure per capita in South America (Brazil, Argentina, Chile,  Peru, Bolivia, Venezuela and Colombia) is an average of USD $77. This compares to a per capita military expenditure of $1,884 by the United States. Chile leads the  per capita defence expenditures in all of Latin America, at USD $214 per  inhabitant.

Country	Military Expenditure	Total Inhabitants	Military Expenditure   per Capita	GBP per Capita
United States	$518,100,000,000	275,000,000	$1,884	$39,496
Chile	$3,420,000,000	15,980,912	$214	$10,904
Argentina	$4,300,000,000	39,537,943	$109	$12,794
Colombia	$3,300,000,000	42,954,279	$77	$6,962
Venezuela	$1,687,000,000	25,375,281	$66	$5,571
Brazil	$11,000,000,000	186,112,794	$59	$8,029
Ecuador	$655,000,000	13,363,593	$49	$4,083
Peru	$829,300,000	27,925,628	$30	$5,556
Bolivia	$132,000,000	8,857,870	$15	$2,710

Part of the reason why the Chilean military receives extensive funding is because it has a large budget, which it obtains partly because of Chile’s copper exports (the armed forces are mandated to receive 10% of the total of all copper exports, a provision in effect since the late 1950's and which remained so during the Eduardo Frei and Salvador Allende administrations until the present time). While Chile leads the region in military expenditure Brazil holds the nuclear card. 

For decades Brazil has been developing what is now a $1 billion nuclear energy industry - driven by its extensive energy requirements and uranium reserves (Brazil has the world's sixth-largest uranium reserves). Already Latin America's biggest nuclear power provider, Brazil plans up to seven new atomic plants to reduce its dependence on oil and hydroelectric power and plans to export enriched uranium to provide energy for other countries. This extensive nuclear program complements Brazil's successful fuel alcohol technology. Brazil's nuclear energy program will be accelerated given the countries fragile relationship with 
Bolivia and their decision to nationalise their gas industry. It seems the future question is undoubtatly about what will happen once the "age of cheap energy" is over. More concerning is the challenge we are facing today - the "age of access to cheap energy".

Brazil's evolution from a nuclear energy producer to a nuclear weapon country  cannot be discounted. However it is very far from being a reality. Brazil's new nuclear plant will be capable of enriching natural uranium to less than 5% uranium-235, an isotope needed to fuel its two reactors. Warheads need more that has been enriched to 95 percent uranium-235, a material Brazil claims "it can't and won't produce".

However Brazil is and will become a key provider of nuclear raw materials - given  their extensive uranium reserves. Its biggest customers will be China, Pakistan and India. Although China recently signed an agreement with Australia to buy 20,000 metric tons of uranium to China each year beginning in 2010, Brazil will become a key exporter of uranium to China. 

It is interesting Iran and Brazil have both recently announced they have enriched uranium for the purpose of energy generation. Far more interesting is the lack of attention Brazil's enrichment program has received from the media, the European Union and the United States. Is there a double standard and should different rules apply? Without a doubt the international community believes so. In an interview 
with the International Herald Tribune, James Goodby, a former arms control negotiator in the Clinton administration stated: "Similar programs in Libya, Iraq, Iran, and North Korea have rightly been seen as either direct or indirect threats to international peace and security. Unlike Brazil, they harbour hostile intent toward the United States." This double standard can also be explained by the fact the United States is trying to generate support for their Free Trade Area of the Americas (FTAA) among key South American nations including Brazil.

So would Chile and Brazil use their respective military and nuclear capabilities to advance their national interests within South America (the same way Bolivia is using gas and Venezuela oil)? Unlikely under the current administrations of Lula and Bachellete. However, nobody can predict the outcome beyond the present administrations. 

The only way military and nuclear proliferation programs will not become an issue in South America is if the region develops close internal economic and political ties. It would be a Matter of Dark Politics if South American countries weighted gas, military capabilities and nuclear programs against each other to advance their national interests.

nuclear Energy military brazil Americas Bolivia evo morales EVO chile uranium nuclear energy electricity

500 days of "Pinochet in Suburbia"

As portrayed in the BBC series Pinochet in Suburbia, General Augusto Pinochet arrived to England in early October, 1998 for a back operation (he had surgery for a herniated disc at the London Bridge Hospital) – 500 days later, the British High Court granted Pinochet immunity from prosecution as a former Head of State. In late October 1998, when Pinochet was taken into custody, the Metropolitan Police said they where acting on a warrant from Spain where Pinochet was investigated over the deaths of Spanish citizens during the period of 1973 and 1990.

The 500 days Pinochet remained under house arrest in England are a riddle of diplomatic and political manoeuvring. It was also one of the most expensive extradition cases ever – Dark Matter Politics can report the Pinochet case cost British taxpayers a staggering £2,204,595 - prosecuting barristers on the case alone were paid £425,077. (complementing source: BBC News)

The political manoeuvring began shortly after the arrest, when Eduardo Frei, Chile’s president, announced a suspension of all official visits and meetings with UK ministers, an end to all flights to the Falkland Islands and the governments’ intent to fight a legal battle to ensure the release of Pinochet. Frei’s reaction was not surprising as it was a decision that appeased key elements of the Chilean military as well as powerful and influential supporters of Pinochet.

More importantly, the decision was driven by the belief of self-determination and the sovereignty of the Chilean people to decide the fate of one of its' citizens. As Colonel Alfredo Ewing stated "As a result, the task of defending what the president (Eduardo Frei) has called a question of principle and what the President of the Supreme Court has said amounts to stamping on our sovereignty is incomplete." However, the choice of Chile’s courts and citizens is limited by the fact that Pinochet provided himself and other members of the Army with immunity from prosecution (based on an amnesty law passed in 1978) as well as naming himself as senator-for-life, as part of the 1980 constitution he pushed forward while in control of the country. Although the1980 constitution was approved by 75% of people, it was regarded as a highly irregular plebiscite and process - there was no constituent assembly or public debate on its contents.

Furthermore, the question of sovereignty clashes with the principle of universal jurisdiction; which has been applied to this case. Wikipedia defines universal jurisdiction for Dark Matter Politics as “a controversial principle in international law whereby states claim criminal jurisdiction over persons whose alleged crimes were committed outside the boundaries of the prosecuting state, regardless of nationality, country of residence, or any other relation with the prosecuting country.” 

The process of establishing a legal course of action for Pinochet in Chile has been slow – although some eighty Pinochet-era officers have been indicted in recent years, including former CNI (secret police) agents who were given life sentences for political murders committed in 1986. In  August 11th, 2000, Chile's Supreme Court announced that they had voted to strip Pinochet of his senatorial immunity. The ruling fell short of requesting medical examinations to establish whether the former military dictator will stand trial. This decision was followed by a ruling the 10th of January, 2006 which strips Pinochet of his legal immunity against trial for the killing of two bodyguards of Salvador Allende. Although unlikely, this ruling might see Pinochet prosecuted by local courts and its fellow citizens in the near future (on other charges related to possible cases of tax evasion and embezzlement).

It is clear no conditions can be placed on obtaining justice for those who suffered most during Pinochet’s rule, however, the fate of Pinochet should lie with the Chilean people and Chilean legal institutions. Without a doubt,  it will be a slow and politically charged process; one of continued painful introspection; but one that is absolutely necessary to ensure Chile continues to establish a shared historical conscious that focuses on truth and social economic development for all. (darkmatterpolitics.com, March 2006).

pinochet, pinochet, politica

The Morning After Pill Debate in Chile

One of Michelle Bachelet, Chile’s latest president who took office in March of this year, key health initiatives was the universal distribution of the “morning after pill” to every woman in Chile that required it. Currently, the “morning after pill” is available under prescription and medical advice for around GBP £12 (11,000 Chilean pesos). Obviously the price places it out of the reach of many women in Chile. The new minister of health, Salud, Soledad Barría, stated during an interview to La Tercera, a leading Chilean newspaper, that the plan for the universal distribution of the pill would occur, but not in the short term, as the government was focused on more pressing health issues.

The Chilean Catholic Church strongly opposes the open distribution of the pill, claiming the universal distribution plan is purely based on social economic criteria that do not account for the “dignity of the individual” or the “potential of life”. 

Many senators and political figures within Chile have already been expressing their views. A leading senator stated he believed the issue was not one of “morality but of hygiene and well being”. It is interesting to see how perspectives are slowly changing in a very traditional Catholic country like Chile - the “moral value” of actions is no longer the only factor being considered when discussing issues such as abortion and sex. However it is clear, the government is seen as an important influence in matters regarding abortion and sex - calls for a government sponsored campaign to educate young people about sex and the alternatives to abortion - are still strong across all groups. What if instead of spending millions on an advertising campaign, the government set-up local programs for the professional and social development of high risk women in Chile?

More importantly, in a country like Chile, the issue of universal distribution of the “morning after pill”, comes down to trying to put an end to one of highest rates of illegal abortions in the continent. It is officially estimated close to 400,000 illegal abortions are performed in Chile, a country with a population of 15 million people – compared to between 1.2 to 1.5 million in the United States with a population of 275 million – a rate five to six times that of the United States.

Lets hope the debate of universal distribution of the “morning after pill” does not become a subject of Dark Matter Politics and that president Michelle Bachelet, as she has proved so far, can go against the status quo to ensure open choice for Chilean women.

chile, morning after pill, Michelle Bachelet

Women, Abortion, Divorce and the Chilean Catholic Church

It is often said that if the Vatican ever had to go into exile again, rather than Avignon, the place of choice would be Santiago de Chile.

Chile has traditionally been a bastion of Catholicism. The strong influence of the Catholic Church is a direct result of the Spanish crown, and the “patronato real”, an agreement that gave the Spanish throne and, by extension, the colonial authorities significant powers in church affairs (for example  appointments of clergy and bishops required the approval of civil authorities). This relationship was cemented in the 1833 constitution, which made Roman Catholicism the established church of the new Chilean republic.

The 1992 census showed that 77% of the population fourteen years of age and older declared itself Catholic, while 13% percent declared itself either Evangelical (the term Evangelical in the country is used to refer to all non-Catholic Christian churches with the exception of the Orthodox, the Church of Jesus Christ of Latter-Day Saints, Seventh-Day Adventists, and Jehovah's Witnesses) or Protestant. Chile’s cultural conservativeness (a direct result of the strong Catholic tradition) has lead to one of the world's most restrictive laws on abortion and divorce. 

Abortion has constituted a crime in Chile. The 1874 penal code prohibits abortion in all cases. In 1931, the Codigo Sanitario (national health law) gave doctors the possibility to provide abortions, without criminal penalties for the doctor or the woman, where necessary to safe the pregnant woman's health or life (so-called "therapeutic abortion.") According to this law, a woman needed the consent of two doctors to obtain a non-punishable abortion. In 1989, President Pinochet annulled this statutory exception to the general illegality of abortion as one of his last acts in office. The national health law now prohibits abortion in all circumstances. However things are beginning to change - in late 2005, the Chilean Supreme Court of Justice authorised the sale of Postinor II, a "morning after pill," which is sold in some pharmacies against medical prescriptions that are retained on file.

Chile didn't legalize divorce until the 11th of March 2004, in great part due to the influence of the Church which effectively blocked the law for over nine years. Chile had been one of the last countries in the world, where divorce is legally forbidden (the law forbidding divorce was passed in 1884). The Church tried to kill the law by creating moral pressure on Parliament members. In an aggressive television advertising campaign, the Church claimed the law would strain the institution of family ("Chile wants a united family. Let's not divide it" was the main claim of the campaign), even threatening ex-communication to Catholic parliamentarians who voted in its favour.

Discussions on the morality of these laws and events will continue for a very long time. However, a central question and matter of Dark Matter Politics is the role and influence of the Chilean church in the advancement of women’s interests in the country.

The Tainted Legacy of Former Chilean President Ricardo Lagos

Before addressing the Dark Matter Politics that have shadowed the government of Ricardo Lagos – who presided as leader of Chile from 2000 to early 2006, it is important to review the historical context leading to his administration.

Chile’s reintegration into the democratic world officially began in 1988 following a national plebiscite. The plebiscite provided Chileans with two choices – SI (yes) to have August Pinochet become president of Chile and NO (no) to have open general elections to elect a new democratic government. The Chilean people opted for general elections – with 53.2% of registered voters voting for open general elections. The NO campaign was led by a coalition of political entities and individuals known as the “Concertacion de Partidos por el No”. Following the call for general elections the organisation regrouped as the Concertación de Partidos por la Democracia, putting forward their Cristian Democrat candidate Patricio Aylwin. Aylwin contended with Hernan Buchi, the candidate of the right centre coalition – the former Minster of Finance from 1985-1989 during the Augusto Pinochet rule.

Aylwin became president of Chile on March 11th 1990 ruling until 1994. Aylwin lead a conservative transition government focused on the readjustment and strengthening of its democratic institutions. Case in point, one of Aylwin's first acts as president was the creation of the National Truth and Reconciliation Commission – an eight-member commission mandated "to clarify the truth on the violations of human rights" during the military rule.

The Aylwin administration was followed by Eduardo Frei, another Christian Democrat part of the Concertación de Partidos por la Democracia who presided from 1994 to 2000 – gaining 57.9% of the national vote. Interestingly, Eduardo Frei’s father Eduardo Frei Montalva was founder for the National Falange, an independent party based on progressive Christian principles, which in 1957 became the core of the new Christian Democratic party. Eduardo Frei’s administration was characterised by strong international relations and strong investment in social and education programs. The Frei administration was followed by Ricardo Lagos. Lagos became the first socialist president since Salvador Allende was deposed by Pinochet in 1973. 

Ricardo Lagos served as public works minister in the government of president Eduardo Frei from 1994 to 1998. In this role, he developed an innovating system of road concessions, integrated the private sector in the construction of works and its later operation. Since 2002 his government faced suspicions of political corruption due to the prosecution of one of his ministers and of other employees of the Public Works Ministry, in what has been coined as the “MOP-GATE” case. A comitee investigating the accusations, discovered that ministers, and other officials of exclusive confidence of the President, received additional payments to their regular remuneration: the so-called "extra payments". This irregularity was acknowledged by Lagos, who specified that the practice had also developed during the governments of Frei Ruiz-Tagle and Aylwin. During his administration Lagos experienced increased public questioning of contracts between his friends, relatives and state institutions. Furthermore, a complex fraud scheme involving government deposits was uncovered accidentally in February 2004, when Central Bank President Carlos Massad’s secretary was caught sending sensitive financial information to an accomplice in a major investment company, giving the impression that local bond and exchange markets were rigged. Tentative losses to the state treasury where estimated at nearly US$100 million, and the scandal briefly threatened to undermine local capital markets. Massad was forced to resign from the Central Bank on April 1 for negligence.

At the moment when his administration faced increased pressure, a government spokesman, made an astonishing request, stating “Lets not damage Chile's image.”

So what where the forces exerting their influence on the Lagos administration and responsible for increased levels of corruption? The first factor is what we define as the “trafficking of influences”, a common practice in Latin America where power and influence is used to advance personal objectives. The second factor is the closer relationship between business and politics – with some politicians preferring to be “business politicians” as opposed to “public servants”. The third factor is the “prolonged single party rule” - the Lagos administration was the third consecutive presidency of Concertación de Partidos por la Democracia, leading to increased status quo within the political system (on the other hand it could be argued as a positive situation ensuring the continuity of policies and initiatives).

It is unfortunate the legacy of the Lagos administration, which was responsible for some very positive initiatives including the the creation of an unemployment insurance; the AUGE health program guaranteeing coverage for a number of medical conditions; extending compulsory schooling to 12 years and the approval of the first divorce law in Chile; has been tainted by claims of corruption and misuse of power.

ricardo lagos, chile , santiago, MOP-GATE