Simón Bolívar’s legacy in Latin America
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To do business in Latin America often means having to contend with protectionist trade policies, and why this is so has been unexpectedly answered in an unlikely quarter.
Netflix’s lavish new 60-episode historical drama, Bolívar, traverses the peripatetic life, loves and
Bolívar was the richest man in Venezuela after inheriting thousands of slaves, gold and silver mines and sugar and cacao plantations at the age of 13.
foremost heroes, General Simón Bolívar – still called “El Libertador” (The Liberator) for leading the “Patriotic Army” that wrested independence from Spain in the early 1800s.
The impeccably-researched series accurately depicts the harsh iniquity of life in Spain’s American colonies, with its extortionate taxation, African slave trade and the Encomienda system (which obliged indigenous peoples to provide free labour to landowners). It also depicts the measures Bolívar and his associates took to enhance the region’s economic prospects.
Bolívar was the richest man in Venezuela after inheriting thousands of slaves, gold and silver mines and sugar and cacao plantations at the age of 13.
Profoundly influenced in his teenage years by a humanist teacher, and after two visits to France where he met Napoleon Bonaparte and the revolutionaries who had overthrown the Bourbon monarchy, Bolívar joined the republican cause.
After riding 123,000km on horseback (according to Wikipedia, twice as far as Alexander the Great), fighting 472 battles and exhausting his fortune financing the revolution, Bolívar succumbed to tuberculosis and died penniless aged 47 in 1830.
Protectionism
In just over 20 years Bolívar liberated an enormous territory that encompassed the modern nations of Bolivia (which is named after him), Colombia, Ecuador, Guyana, Panama, Peru and Venezuela. And as President of the new nations, he played a large part in shaping the constitutional frameworks, legal systems and closed markets which largely still apply in those nations today.
Eduardo Galeano’s acclaimed book, Open Veins of Latin America: Five Centuries of the Pillage of
a Continent, best and chillingly explains why trade protectionism has been the norm in the region since Bolívar’s day.
Galeano sheds light on how the equivalent of trillions of dollars
in precious metals and Latin America’s unique horticultural products were cheaply produced on the backs of slaves and systematically shipped to Spain (and Portugal in Brazil’s case), and how the rapacious colonial powers beggared the region to such an extent it has yet to fully recover.
US pressure
After the Spanish left, the
US posed a new threat with
its “Munroe Doctrine”, which unashamedly sought to limit European influence in Latin America so they could more freely exploit it themselves.
The first gambit was in 1826 when the US asked Bolívar to grant them a concession to build a canal across the Isthmus of Panama.
Bolívar refused, as he feared US influence, which 75 years later proved to be remarkably prescient when, with US military backing, Panama split from present-day Colombia in 1903 and ended up as a de facto US colony.
The price of US military backing was its long-sought Panama Canal concession which, while incredibly lucrative for its US owners, provided little benefit to the impoverished population until 1999. At that
There are many salutary examples of how exploitative US companies have dominated many Latin American markets, but one that really stands out is the United Fruit Corporation (known as El Pulpo – The Octopus).
United Fruit, in cahoots with local oligarchs and US-sponsored dictators, made billions throughout the 20th Century by practically enslaving the indigenous peoples of Costa Rica, Guatemala and Honduras to produce bananas (giving birth to the term “Banana Republic”).
Another stand-out has been voracious US oil companies, again in cahoots with local oligarchs and corrupt presidents, which ran Venezuela as a corporate fiefdom from 1914 until their assets were nationalised in 1976 (when a period of prosperity ensued, which has now sadly been lost to a home-grown gang of thieves).
Engagement widening
The existence of modern institutions to regulate trade (WTO and GATT), plus development banks (IMF, the World Bank and IADB) and the rise
of neoliberal economics, have seen Latin America lessen its market protections.
Those mechanisms have also encouraged the formation of regional free trade blocs such as Mercosur and the Pacific Alliance, and further afield including with New Zealand through the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), and in other individual free trade agreements.
Source: Thomas Manning is governing director of Manning Group Limited and a former vice-president of the Latin America NZ Business Council.
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