On residential streets of Caracas with little traffic it is possible to see cars that have been abandoned by their owners for years. They probably migrated from Venezuela or cannot afford to repair and sell their vehicles. CREDIT: Humberto Márquez / IPS

By Humberto Márquez
CARACAS, Oct 23 2023 (IPS)

Diego has just enrolled to study journalism at a university in the Venezuelan capital and, with 2,000 dollars that his family members managed to gather, has bought his first car, a small 2007 Ford that can take him to class from his home in the neighboring Caribbean port city of La Guaira.

Tomás, an experienced physiotherapist who sold Diego the car, is leaving for Spain where a job awaits him without delay, “so I’m quickly selling off things that will give me money to settle there, such as furniture, household goods and appliances, but for now I sold only one of my two cars,” he told IPS."The vehicle fleet in Venezuela - a country that now has 28 million inhabitants - is about 4.1 million vehicles, with an average age of 22 years, and 25 percent of them are out of service. The loss of purchasing power of the owners has caused most of them to delay the maintenance of their vehicles and the replacement of the spare parts that suffer wear and tear, such as tires, brakes, shock absorbers and oil." -- Omar Bautista

“This Ford Fiesta was my first car, I loved it very much, but it doesn’t make sense for me to hold on to two vehicles. I’m keeping a 2011 pickup truck that is in good condition, just in case I don’t do well and I have to return,” added the professional who, like other sources who spoke to IPS, asked not to disclose his last name “for safety reasons.”

The migration of almost eight million Venezuelans in the last 10 years, and the general impoverishment of the population, have led to the deterioration of what was once a shiny fleet of vehicles, with one out of every four vehicles left standing now due to lack of maintenance and leaving much of the rest aging and on the way to the junkyards.

In the basements of parking lots, and in the streets of towns and cities, thousands and thousands of vehicles are permanently parked under layers of dust and oblivion, because their owners have left or because they do not have the money to buy spare parts and pay the costs of repairs.

Along the streets of any Venezuelan city can be seen old rundown vehicles with no sign that the necessary repairs will be made. The impoverishment of the population is at the root of this decline. CREDIT: RrSs

Aging vehicle fleet

Omar Bautista, president of the Chamber of Venezuelan Automotive Manufacturers, told IPS that “the vehicle fleet in Venezuela – a country that now has 28 million inhabitants – is about 4.1 million vehicles, with an average age of 22 years, and 25 percent of them are out of service.”

“The loss of purchasing power of the owners has caused most of them to delay the maintenance of their vehicles and the replacement of the spare parts that suffer wear and tear, such as tires, brakes, shock absorbers and oil,” Bautista said.

Moreover, in contrast to the immense oil wealth in its subsoil, gasoline in Venezuela is scarce and, after more than half a century being the cheapest in the world, it is now sold at half a dollar per liter, a cost difficult to afford for most owners of private vehicles or public transportation.

The country needs some 300,000 barrels of fuel per day and for several years it has had less than 160,000 barrels, according to oil economist Rafael Quiroz, who added that interruptions in the work of Venezuela’s refineries are frequent.

There is almost no residential building that does not have at least one vehicle in storage waiting for its owners to return from abroad. They are part of the 1.5 million vehicles that are permanently parked in the country. CREDIT: Humberto Márquez / IPS

Not enough money

The minimum wage in Venezuela is four dollars a month. Most workers receive up to 50 dollars in non-wage compensation for food, and the average income according to consulting firms is around 130 dollars a month.

Luisa Hernández, a retired teacher, earns a little more giving private English classes, but “the situation at home is very difficult. I can’t afford to pay for the repair of my Toyota Corolla, but a mechanic friend agreed to do the work, and I can pay him in installments,” she told IPS.

Mechanics have their finger on the pulse of the situation. “People leave and the cars often sit idle for years, and then the owners end up selling them, from abroad. Quite a few of those I have gone to pick up and have fixed them, to sell them,” Daniel, who runs a garage in the capital’s middle-class east side, told IPS.

He said that “many people do not sell their cars before leaving the country, thinking that they’re just going abroad to ‘see how it goes’. But they stay there and then decide to sell their vehicle before it further deteriorates and depreciates.”

Another mechanic, Eduardo González, told IPS that “There are people who go away and leave their cars in storage and from abroad they contact us so that from time to time we can check them and do some maintenance. Or they entrust their vehicle to a relative. There are people who travel and come back, but most of them end up selling.”

This situation “has favored buyers, who can get cars at a low price. But the problems come later, because that very used car will require spare parts and maintenance, and that is expensive and often the parts are difficult to get,” added González.

The same difficulty is also a concern for owners of cabs, buses and private vans that transport passengers, as well as cargo trucks.

“At least half of the truck fleet in the region is affected by the shortage and scarcity of spare parts,” said Jonathan Durrelle, president of the Chamber of Cargo Transportation of Carabobo, an industrial state in the center of the country.

Large and small buses for passenger transport in Venezuelan cities, including Caracas, as well as cargo vehicles, also suffer from the lack of sufficient revenue, as well as spare parts, to keep them in proper working condition. CREDIT: Humberto Márquez / IPS

Industries have closed down

Elías Besis, from the Chamber of Spare Parts Importers, attributed this to the closure of companies that “years ago manufactured 62 percent of the spare parts needed in the country, and now that production has plunged to two percent.”

Thousands of manufacturing companies closed down in Venezuela during the eight years (2013-2020) in which the country was in deep recession, suffering a loss of four-fifths of its GDP according to economic consulting firms.

Financial and banking activity has also declined, as has the vehicle loan portfolio, which peaked at 2.3 billion dollars in 2008 and plummeted to just 227,000 dollars by late 2022, according to economist Manuel Sutherland.

Vehicle assembly plants, of which there were a dozen until recently, also closed their doors. In addition to selling to hundreds of dealerships, they used to export vehicles to the Andean and Caribbean markets.

Their production peaks were recorded in 1978, with 182,000 new vehicles – Venezuela then had 14 million inhabitants and 2.5 million vehicles – and in 2007, when 172,000 cars were assembled.

In 2022 only 75 vehicles – trucks and buses – were assembled, and in the first six months of this year just 22.

Newer vans and cars drive through middle and upper class neighborhoods, but are part of the “bubble,” the small segment of the population less impacted by the deep economic crisis that Venezuela has suffered over the last decade. CREDIT: Motorpasión

Farewell to the bonanza

The result of this scenario is the aging and non-renewal of the vehicles circulating on Venezuela’s roads.

The new ones, Daniel pointed out, “are SUVs, crossovers and off-road vehicles that cost a lot of money and can only be bought by those who live in the bubble,” the term popularly used to refer to the segment of high-level officials and businesspersons whose finances are still booming in the midst of the crisis.

In addition, in view of the almost total closure of automotive plants, individuals are opting to import new vehicles directly from the United States, favored by the elimination of tariffs for the importation of most models.

For that reason, said Bautista, “there is no shortage of new vehicles, what there is is a shortage of consumers with the necessary purchasing power and conditions to buy new vehicles.”

These consumers were part of the hard-hit middle class – nine out of 10 families in that socioeconomic category had fallen below the middle class by 2020 according to the consulting firm Anova – and they no longer buy new or newer cars because they have swelled the legion of migrants, selling or leaving behind their main assets.

Since the days of the oil boom (1950-1980), Venezuelans developed a sort of sentimental relationship with their vehicles, associating them with comfort and enjoyment that favored cheap gasoline and a network of paved roads that made it easier to travel to places of recreation.

In middle class and even lower middle class families, it was quite common to change cars every two years and to give one to their children when they turned 18. They were helped by credit facilities, and were encouraged to buy cars in cities where public transportation has always fallen short.

They have had to say goodbye to their easy past on wheels, like migrants have said farewell to their country and homeland. Or at least “see you later”.

A view of Caracas from the south side of the narrow valley where it sits, dotted with houses and residential buildings where full occupancy was the norm until a few years ago. As a result of the massive migration of young people and adults, more and more homes are left unoccupied or inhabited only by the elderly and young children. CREDIT: Humberto Márquez / IPS

By Humberto Márquez
CARACAS, Oct 4 2023 (IPS)

Gladys swore she would not cry in front of her small children, but she still had to wipe away a couple of tears when she turned her head and looked, perhaps for the last time, at her dream house on Margarita Island in Venezuela, from where she migrated, driven by a lack of income and by fear.

“It hurts to leave your own home, the most precious material asset for a family like ours (she works in administration, her husband is a mechanic, and they have two boys), but we lost our jobs and were robbed in broad daylight in the middle of the city. That led us to decide to emigrate,” she told IPS from Miami, Florida in the U.S.

Due to the economic, social and political crisis, which gave rise to a complex humanitarian emergency, 7.7 million Venezuelans, according to United Nations agencies, have migrated from this country, the vast majority in the last decade, and the flow is not slowing down, especially to other countries in the region."It hurts to leave your own home, the most precious material asset for a family like ours, but we lost our jobs and were robbed in broad daylight in the middle of the city. That led us to decide to emigrate." -- Gladys

The family of Gladys, who like other people who talked to IPS preferred not to give her last name, tried their luck in Colombia, Panama and Spain, before finally settling in the United States, “and the worry about the house followed us like a shadow, but fortunately we made a deal with an enterprising young man who takes care of it, improves it and pays a modest rent.”

There are thousands like her. Migrants try not to leave their homes empty and abandoned, because they could lose them. For this reason, since most migrants are adults in their most productive age and young people, relatives of other ages remain in the homes, giving Venezuela the appearance of being a country of elderly people and children.

“I have to close up my home,” said Juan Manuel Flores, from San Antonio de Los Altos, a satellite city of Caracas with many middle class houses. “The neighbors will take care of it. It took us more than five years to build it and it cost between 150,000 and 200,000 dollars. Now I can’t get more than 60,000 dollars for it. We are not just going to give it away for that price.”

Flores, a teacher at a school where he earns less than 200 dollars a month, is preparing to travel to Spain, where his wife and adult daughters have gone ahead of him. “I will return to Venezuela when the country and its economy improve, and housing prices will rise again,” he told IPS, although without much conviction.

Solitude eats away at houses and buildings even in sought-after areas of the residential and commercial municipality of Chacao, in eastern Caracas. The real estate and construction market is suffering in Venezuela from the general economic crisis and in particular from the oversupply of housing created by those leaving the country. CREDIT: Humberto Márquez / IPS

Why not rent out their house? “Because the laws and the authorities always favor the tenant, and if they have children it is impossible to get them out when the lease is up, whether they pay the rent or not, and they end up staying in the house for years,” said Nancy, a pastry chef, also from San Antonio, who left a niece in charge of her apartment when she moved to Brazil last year.

A survey of migrants in Colombia, Ecuador and Peru, released in October 2022 by the Interagency Coordination Platform for Refugees and Migrants in Venezuela (R4V), led by United Nations agencies, showed that only 23 percent considered the homes they left behind in their country to be safe.

Selling is also not an option in most cases, because the magnitude of the exodus over the last decade has so depressed demand that the most that can be obtained for a property is 15 or 20 percent of the value it had 15 years ago, if you are lucky. So selling a home even if you want to is a long, difficult process that provides meager results.

Those who have no other choice say that they are not selling their home but “giving it away” for whatever they can get, with great regret, mostly to internal migrants from other parts of the country, who “take refuge” in Caracas because outside the capital there are recurrent power outages, and scarcity of water and fuel, in addition to other shortages.

“Real estate deteriorates, ceases to serve those who need it and remains an important asset that produces nothing for the owner, for example a migrant who needs to pay rent as soon as they arrive in another country,” Roberto Orta, president of the Venezuelan Real Estate Chamber, told IPS.

The businessman said “this is an issue that, we have proposed, should be addressed with political will in order to reform the laws that constrain the real estate market, to benefit both landlords and tenants. Up to 250,000 homes could be freed up in five years.”

A view of the working-class neighborhood of 23 de Enero on the west side of Caracas. In low-income barrios, closed, empty houses are almost non-existent, as those who decide to emigrate look for relatives to move in, to avoid the risk of the homes being invaded or robbed. CREDIT: Humberto Márquez / IPS

A trade is born

In the residential buildings located in Caracas and other cities, closing up an apartment and moving outside the country is not the same as leaving a house abandoned to solitude and neglect, because the neighbors, for their own safety and in order to pay the common expenses, keep watch and take care to prevent strangers from occupying the empty apartments.

But houses, especially middle-class homes, are an attractive and easy target for crime and even for people who want to occupy them by de facto means. That is why a new profession has appeared: the home caretaker.

“I have taken care of three houses in housing developments in the southeast (of Caracas), it’s the way I make ends meet,” said Daniel, who also works as a self-employed gardener. “I would go to one house twice a week, three times a week to another, and every day to another.”

He explains that in the last house “the owners were Portuguese business owners who went away and left three dogs. I would go to a pet food store to pick up the food, feed the dogs, check around the house and that was it.”

Family friends of the owners have now taken charge of the dogs and Daniel no longer receives payment for taking care of them. “I don’t have an account in dollars, I was paid through a restaurant friend of the owners, who does have an offshore account,” he said.

To pay for caretakers from abroad, intermediaries are indispensable, since in Venezuela, whose currency has been made nearly worthless by the economic crisis, there is a de facto dollarization, without agreement from the U.S. authorities, who also use sanctions to block the transactions of government bodies.

Daniel is saving up to join one of the groups forming in Antímano, the working-class neighborhood where he lives in the southwest of the capital, to migrate as well. He said that “I didn’t leave a few weeks ago because I hadn’t sold my motorcycle yet, otherwise right now I would be in the Darien,” the dangerous jungle between Colombia and Panama that thousands of migrants cross every day.

A more successful caretaker is Arturo, who is in charge of two houses with large living rooms, corridors, yards, a swimming pool and parking area. He is paid a modest fee to care for and maintain the homes, but is authorized to rent them out for social gatherings and parties.

“In both cases the owners are people with good incomes, they left with their children to study abroad and plan to return in a few years if conditions in the country change. They would like to find their homes as they left them,” he said.

When he rents out the property for a day or a night, guests can use the yards, swimming pool and even awnings, tables and chairs. But Arturo closes off access to the more private parts of the house and hires assistants to watch out for damages or disturbances. “I live well, I keep up the houses and each one brings me about 3,000 dollars in profits per month,” Arturo said.

President Nicolás Maduro delivers a batch of houses in the northwestern state of Falcón, which form part of the 4.6 million homes that the government claims to have built and provided to Venezuelan families since 2013. The figure is questioned by organizations dedicated to monitoring economic and social rights. CREDIT: Minhvi

No empty houses in the shantytowns

In the shantytowns of the cities and towns of this country – which has a population of 33.7 million according to government figures and 28 million according to university studies – the situation is different and there are hardly any empty or unoccupied houses.

“In the shantytowns, no house is left empty. The very next day someone can invade it, occupy it, or take what is left inside by those who left, furniture or household goods. Someone stays in charge, the grandfather or in-laws, a trusted neighbor, or a relative is brought from the interior of the country,” explained Alejandra, from the Gramoven area.

She lives in a shantytown of informally constructed dwellings in the northwest of Caracas, similar to the ones that cover most of the many hills and hollows occupied by the capital’s most disadvantaged inhabitants.

“Many people leave, the young people emigrate, my children want to leave through the Darien jungle. But nobody leaves their house empty. If you do, you lose it,” Alejandra said.

In Santa Bárbara del Zulia, on the hot plains south of western Lake Maracaibo, “the situation is the same,” Julio, a bricklayer who migrated to Colombia for four years and has returned to care for his elderly parents, told IPS.

“You can’t leave your house alone in these towns,” said Julio. “When my parents went to Maracaibo and Caracas for medical treatment, they went and came back quickly, because the Community Council warned them not to leave their house empty for too long, because they would not be able to ward off people who wanted to occupy it.”

The Community Councils are committees set up by the government to represent and manage community affairs – such as the distribution of bags of subsidized food to poor families – and they channel decisions by the government.

“But people are leaving anyway. It’s something that won’t stop as long as people here earn only a pittance and can’t even eat properly (the minimum wage and official pensions in Venezuela are equivalent to four dollars a month). People care about their houses, but food has to come first,” said Julio.

View of a row of houses practically abandoned by most of their inhabitants in a town in eastern Venezuela. Migration from the countryside and small towns to large cities and oil producing areas marked the 20th century in Venezuela. And today, migration from this country mainly to other Latin American nations has become a regional crisis. CREDIT: VV

A matter for the government and the business community

While the plight of people leaving their homes continues to drag on, the government of President Nicolás Maduro announces more or less twice a year the construction of hundreds of thousands of new homes, in a program initiated by his late predecessor Hugo Chávez (1999-2013), called “Venezuela’s Great Housing Mission”.

According to official figures, since 2011, 4.6 million homes have been built and delivered by the Mission, mostly residential complexes to which the president goes to personally hand over the keys of one or more houses to their new inhabitants.

In accordance with the Mission, the occupants are tenants, not owners, so they cannot sell the homes. If they leave, the home can be reassigned to new tenants. To avoid this, those who choose to move to another city or country first look for relatives who can move into the house, and thus keep it.

However, the official figures on the number of homes built is not borne out by anecdotal evidence, to judge by the myriad of informal self-built houses still occupied in the slums, and by reports from business and civil society organizations.

The Chamber of Construction reports that the sector has decreased 96 percent in the last 10 years, and that its members employ 20,000 workers, down from 1.2 million in better times, while cement companies are working at 10 percent of their capacity and the steel industry at seven percent.

The civil society organization Provea, which specializes in the study of economic, social and cultural rights, has compared and contrasted the figures of the Housing Mission – which have not been audited, according to Provea – with independent studies, and reached the conclusion that the government has built and delivered only 130,856 housing units in 10 years.

In 1955 the Venezuelan writer Miguel Otero Silva (1908-1985) published his famous novel “Casas Muertas” (Dead Houses), describing the decline of Ortiz, a town in the central plains, caused by the loss of its population due to malaria and emigration to the big cities and oil production centers.

The flow of Venezuelan emigration in this century has not been enough to turn this into a country of dead houses. But its many closed doors bear witness to a collapse that has pushed millions of its inhabitants abroad, as do the small number of lights that are lit at night in the buildings of Caracas and other cities.

The carts of “cartoneros” or garbage pickers stand in front of a merchandise purchase warehouse in the La Paternal neighborhood in the city of Buenos Aires. CREDIT: Daniel Gutman/IPS

By Daniel Gutman
BUENOS AIRES, Apr 6 2023 (IPS)

It’s a Monday morning in April on Florida, a pedestrian street in the heart of the Argentine capital, and a small crowd gathers outside the window of an electronic appliance store to watch a violent scene on a TV screen. But it is not part of any movie or series.

The scene, broadcast live, is happening a few kilometers away, in a poor suburb of Buenos Aires: colleagues of a city bus driver who was murdered during a robbery throw stones and fists at the Minister of Security of the province of Buenos Aires, Sergio Berni, who had come to talk and offer the government’s condolences in front of the cameras.

No one seems surprised among the office employees watching the scene on TV, and several make no effort to hide a certain sense of satisfaction that other ordinary people have decided to take action against a representative of the political leadership, the target of widespread discontent, as reflected by the opinion polls.“There is growing social polarization in Argentina, with an increasingly weak middle class. Each crisis leaves another part of society outside the system.” -- Agustín Salvia

“This was bound to happen sometime, if the politicians earn a fortune for doing nothing and we work all day to earn a pittance… And on top of that you go out on the street and they kill you just to rob you,” comments one of the viewers, as the rest listen approvingly.

The scene reflects the climate of tension and the sense of being fed-up that is felt in large swathes of Argentine society, in the midst of a long, deep economic crisis, which in the last five years has constantly chipped away at the purchasing power of wages, due to inflation that occasionally stops growing for a couple of months, only to surge again with greater force.

If there was room for modest optimism in 2022, as the result of a recovery in economic activity after the peak of the COVID-19 pandemic, it seems distant today, since the beginning of this year brought news that reflects the magnitude of the breakdown of the social fabric in this Southern Cone country.

On Mar. 31, the official poverty rate for the second half of 2022 was announced: 39.2 percent of the population, or 18.1 million people in this South American country of 46 million, according to the most up-to-date figures.

Since 2021 ended with a poverty rate of 37.3 percent, this means that in one year a million people were thrown into poverty, despite the fact that the economy, thanks to the rebound in post-pandemic activity, grew 4.9 percent, above the average for the region, according to the Economic Commission for Latin America and the Caribbean (ECLAC).

But these data are already old and the figures for 2023 will be worse due to the acceleration of inflation, which is surprising even by the standards of Argentina, a country all too accustomed to this problem.

The price rise in February reached 6.6 percent, exceeding the 100 percent year-on-year rate (from March 2022 to February 2023) for the first time since 1991.

When you look a little closer, perhaps the worst aspect is that prices grew much more than the average, 9.8 percent, for food, the biggest expense for the lowest-income segments of society.

To this picture must be added an extreme drought that has affected the harvest of soybeans and other grains, which are the largest generator of foreign exchange in Argentina. The estimates of different public and private organizations on how much money the country will lose this year in exports range between 10 and 20 billion dollars.

This is one of the reasons why the World Bank, which had forecast two percent growth for the Argentine economy this year, revised its estimates at the beginning of April and concluded that there will be no economic growth in 2023.

Luis Ángel Gómez sits in the soup kitchen that he runs in the municipality of San Martín, one of the most densely populated areas in Greater Buenos Aires. For the past 10 years, he has been serving lunch and afternoon snacks to about 70 children, but lately he has also been helping their parents and grandparents. CREDIT: Daniel Gutman/IPS

Soup kitchens

About 15 kilometers from the center of Buenos Aires, in the Loyola neighborhood, the cold statistics on the economy translate into ramshackle homes separated by narrow alleyways, with piles of garbage at the corners and skinny dogs wandering among the children playing in the street.

In a truck trailer that carries advertising for a campaigning politician, a dentist extracts teeth free of charge for local residents, who have increasing problems accessing health services.

The neighborhood is in San Martín, one of the municipalities on the outskirts of Buenos Aires. Eleven million people live in these working-class suburbs (almost a quarter of the country’s total population), where the poverty rate is 45 percent, higher than the national average.

“I have never before seen what is happening today. Before, only men went out to pick through the garbage (for recyclable materials to sell), because the idea was that the streets weren’t for women. But today the women also go out,” Luis Ángel Gómez, 58, born and raised in the neighborhood, who does building work and other odd jobs, told IPS.

Indeed, the carts of the “cartoneros” or garbage pickers, which used to be seen only in the most densely populated working-class neighborhoods of Buenos Aires after sunset, when the building managers take out the garbage, are now seen throughout the city and at all hours.

A market selling clothes at low prices in Parque Centenario, one of the best-known markets in Buenos Aires, located in Caballito, a traditional upper middle-class neighborhood of Buenos Aires. This type of street fair has mushroomed in Argentina in the face of persistent inflation that is destroying the purchasing power of wages. CREDIT: Daniel Gutman/IPS

Gómez has been running a soup kitchen in Loyola for 10 years, where he provides lunch three times a week and afternoon snacks twice a week to more than 70 children and adolescents. It is in a room with a tin roof, a couple of gas stoves and photos of smiling boys and girls as decoration.

“The municipality gives me some merchandise: 20 kilos of ground meat and two boxes of chicken per month. Besides that, I cook with donations,” said Gómez. “This box was given to me by the company that collects garbage in the municipality,” he added, pointing to cartons of long-life milk.

But the soup kitchen cannot meet all the needs of the local residents, said Gómez. “My concern was to give the kids a better future and I fed them until they were 14 or 15 years old. Today I also have to help their parents and grandparents.”

The carts of “cartoneros” or garbage pickers, which until a few years ago were only seen after sunset in the most densely populated low-income neighborhoods, today have become a common image in every part of Buenos Aires at all times of the day. One is seen here in the neighborhood of Flores. CREDIT: Daniel Gutman/IPS

The middle class on the slide

The crisis has picked up speed since 2018 and deepened with the pandemic, but Argentina is going through a period of stagnation, with low economic growth and very little formal private sector job creation for more than a decade.

A study recently presented by the Pontifical Catholic University of Argentina (UCA) shows that since 2010 access to food, healthcare, employment and social security have steadily worsened, despite social assistance, affecting five million households out of a total of 12 million.

“There is growing social polarization in Argentina, with an increasingly weak middle class. Each crisis leaves another part of society outside the system,” sociologist Agustín Salvia, director of the UCA’s Social Observatory on Argentine Social Debt, which is considered a chief reference point in the country, told IPS.

Salvia explained that the improvement in economic activity after the peak of the COVID-19 pandemic drove the creation of new jobs until the third quarter of last year, although poverty grew just the same because they were almost all precarious low-wage jobs.

“The post-pandemic recovery cycle is over. Since the last quarter of 2022 there has been no more job creation, which added to inflation will cause poverty to grow in 2023,” added Salvia.

The expert said structural or chronic poverty used to be 25 or 30 percent in Argentina, but has now held steady at 40 or 45 percent, with a deterioration marked by the stagnation of quality employment, which has pushed many formerly middle-class families into poverty.

A group of Farmacoop workers stand in the courtyard of their plant in Buenos Aires. Members of the Argentine cooperative proudly say that theirs is the first laboratory in the world to be recovered by its workers. CREDIT: Courtesy of Pedro Pérez/Tiempo Argentino.

By Daniel Gutman
BUENOS AIRES, May 24 2022 (IPS)

“All we ever wanted was to keep working. And although we have not gotten to where we would like to be, we know that we can,” says Edith Pereira, a short energetic woman, as she walks through the corridors of Farmacoop, in the south of the Argentine capital. She proudly says it is “the first pharmaceutical laboratory in the world recovered by its workers.”

Pereira began to work in what used to be the Roux Ocefa laboratory in Buenos Aires in 1983. At its height it had more than 400 employees working two nine-hour shifts, as she recalls in a conversation with IPS.

But in 2016 the laboratory fell into a crisis that first manifested itself in delays in the payment of wages and a short time later led to the owners removing the machinery, and emptying and abandoning the company.

The workers faced up to the disaster with a struggle that included taking over the plant for several months and culminated in 2019 with the creation of Farmacoop, a cooperative of more than 100 members, which today is getting the laboratory back on its feet.

In fact, during the worst period of the pandemic, Farmacoop developed rapid antigen tests to detect COVID-19, in partnership with scientists from the government’s National Council for Scientific and Technical Research (Conicet), the leading organization in the sector.

Farmacoop is part of a powerful movement in Argentina, as recognized by the government, which earlier this month launched the first National Registry of Recovered Companies (ReNacER), with the aim of gaining detailed knowledge of a sector that, according to official estimates, comprises more than 400 companies and some 18,000 jobs.

The presentation of the new Registry took place at an oil cooperative that processes soybeans and sunflower seeds on the outskirts of Buenos Aires, built on what was left of a company that filed for bankruptcy in 2016 and laid off its 126 workers without severance pay.

Edith Pereira (seated) and Blácida Benitez, two of the members of Farmacoop, a laboratory recovered by its workers in Buenos Aires, are seen here in the production area. This is the former Roux Ocefa laboratory, which went bankrupt in the capital of Argentina and was left owing a large amount of back wages to its workers. CREDIT: Daniel Gutman/IPS

The event was led by President Alberto Fernández, who said that he intends to “convince Argentina that the popular economy exists, that it is here to stay, that it is valuable and that it must be given the tools to continue growing.”

Fernández said on that occasion that the movement of worker-recuperated companies was born in the country in 2001, as a result of the brutal economic and social crisis that toppled the presidency of Fernando de la Rúa.

“One out of four Argentines was out of work, poverty had reached 60 percent and one of the difficulties was that companies were collapsing, the owners disappeared and the people working in those companies wanted to continue producing,” he said.

“That’s when the cooperatives began to emerge, so that those who were becoming unemployed could get together and continue working, sometimes in the companies abandoned by their owners, sometimes on the street,” the president added.

Two technicians package products at the Farmacoop laboratory, a cooperative with which some of the workers of the former bankrupt company undertook its recovery through self-management, a formula that is growing in Argentina in the face of company closures during successive economic crises. CREDIT: Courtesy of Farmacoop

A complex social reality

More than 20 years later, this South American country of 45 million people finds itself once again in a social situation as severe or even more so than back then.

The new century began with a decade of growth, but today Argentines have experienced more than 10 years of economic stagnation, which has left its mark.

Poverty, according to official data, stands at 37 percent of the population, in a context of 60 percent annual inflation, which is steadily undermining people’s incomes and hitting the most vulnerable especially hard.

The latest statistics from the Ministry of Labor, Employment and Social Security indicate that 12.43 million people are formally employed, which in real terms – due to the increase of the population – is less than the 12.37 million jobs that were formally registered in January 2018.

“I would say that in Argentina we have been seeing the destruction of employment and industry for 40 years, regardless of the orientation of the governments. That is why we understand that worker-recovered companies, as a mechanism for defending jobs, will continue to exist,” says Bruno Di Mauro, the president of the Farmacoop cooperative.

“It is a form of resistance in the face of the condemnation of exclusion from the labor system that we workers suffer,” he adds to IPS.

“He who abandons gets no prize” reads the banner with which part of the members of the Farmacoop cooperative were demonstrating in the Plaza de Mayo in downtown Buenos Aires, during the long labor dispute with the former owners who drove the pharmaceutical company into bankruptcy. The workers managed to recover it in 2019. CREDIT: Courtesy of Bruno Di Mauro/Farmacoop.

Today Farmacoop has three active production lines, including Aqualane brand moisturizing cream, used for decades by Argentines for sunburn. The cooperative is currently in the cumbersome process of seeking authorizations from the health authority for other products.

“When I look back, I think that we decided to form the cooperative and recover the company without really understanding what we were getting into. It was a very difficult process, in which we had colleagues who fell into depression, who saw pre-existing illnesses worsen and who died,” Di Mauro says.

“But we learned that we workers can take charge of any company, no matter how difficult the challenge. We are not incapable just because we are part of the working class,” he adds.

Farmacoop’s workers currently receive a “social wage” paid by the State, which also provided subsidies for the purchase of machinery.

The plant, now under self-management, is a gigantic old 8,000-square-meter building with meeting rooms, laboratories and warehouse areas where about 40 people work today, but which was the workplace of several hundred workers in its heyday.

It is located between the neighborhoods of Villa Lugano and Mataderos, in an area of factories and low-income housing mixed with old housing projects, where the rigors of the successive economic crises can be felt on almost every street, with waste pickers trying to eke out a living.

Edith Pereira shows the Aqualane brand moisturizing cream, well known in Argentina, that today is produced by the workers of the Farmacoop cooperative, which has two industrial plants in Buenos Aires, recovered and managed by the workers. CREDIT: Daniel Gutman/IPS

“When we entered the plant in 2019, everything was destroyed. There were only cardboard and paper that we sold to earn our first pesos,” says Blácida Martínez.

She used to work in the reception and security section of the company and has found a spot in the cooperative for her 24-year-old son, who is about to graduate as a laboratory technician and works in product quality control.

A new law is needed

Silvia Ayala is the president of the Mielcitas Argentinas cooperative, which brings together 88 workers, mostly women, who run a candy and sweets factory on the outskirts of Buenos Aires, where they lost their jobs in mid-2019.

“Today we are grateful that thanks to the cooperative we can put food on our families’ tables,” she says. “There was no other option but to resist, because reinserting ourselves in the labor market is very difficult. Every time a job is offered in Argentina, you see lines of hundreds of people.”

Ayala is also one of the leaders of the National Movement of Recovered Companies, active throughout the country, which is promoting a bill in Congress to regulate employee-run companies, presented in April by the governing Frente de Todos.

“A law would be very important, because when owners abandon their companies we need the recovery to be fast, and we need the collaboration of the State; this is a reality that is here to stay,” says Ayala.

Argentine President Alberto Fernández stands with workers of the Cooperativa Aceitera La Matanza on May 5, when the government presented the Registry of Recovered Companies, which aims to formalize worker-run companies. CREDIT: Casa Rosada

The Ministry of Social Development states that the creation of the Registry is aimed at designing specific public policies and tools to strengthen the production and commercialization of the sector, as well as to formalize workers.

The government defines “recovered” companies as those economic, productive or service units that were originally privately managed and are currently run collectively by their former employees.

Although the presentation was made this month, the Registry began operating in March and has already listed 103 recovered companies, of which 64 belong to the production sector and 35 to the services sector.

The first data provide an indication of the diversity of the companies in terms of size, with the smallest having six workers and the largest 177.

By Fernando J. Cardim de Carvalho
RIO DE JANEIRO, Dec 30 2015 (IPS)

As 2015 approaches its end, Brazilians live a period of extraordinary uncertainty. The recession seems to get worse by the day. Inflation is high and shows unexpected resistance to tight monetary policies applied by the Central Bank. The sluggish international economy has largely neutralized incentive and the strong devaluation of the domestic currency could represent a reality to exporters and to producers who compete with now more expensive imports. After an initial resistance, employment levels began to fall.

Fernando J. Cardim de Carvalho

Any subset of that list of events would be enough to generate widespread instability. All of them put together created a hitherto unheard of situation of political and economic crisis of which one has to make extraordinary efforts to see any way out.

Impeachment procedures against the president did not come out of the blue. The revelation of the Petrobras scandal has brewed rumors and suspicions, if not against the president herself, certainly against many of those who surround, or have surrounded, her (she is a former minister of energy in Lula’s government and a former chairman of the administration council of Petrobras.) So far, however, no accusations or evidence emerged against Rousseff. In fact, she does not even seem to be a major target of investigators, who seem to be zeroing in on Lula (and his immediate family.) The piece of accusation justifying the opening of impeachment proceedings relies on the use of accounting artifices to violate the constraints on public expenditure imposed by the Fiscal Responsibility Act, which a majority of opinion makers seem to consider too weak a case to sustain an impeachment. What makes the whole process more menacing is in fact her acute political fragility. Rousseff is universally seen as Lula’s creation, but never really relinquished his power over the party and the coalition it led.

Soon after Rousseff was reelected in November 2014, she announced a radical change of orientation in her administration’s economic policies. Austerity policies, cutting expenditures and raising taxes, seemed to be unavoidable in the face of the increased federal expenditure made to ensure her victory in the presidential elections.

The incumbent president repeatedly stated during the campaign that she rejected those policies, only to announce their implementation a few days after the result of the popular vote became known. Despite the apparent support of Lula, the change in orientation was badly received by the official Workers Party (PT), which grudgingly announced support for her, but conditioning it to a change in macroeconomic policies.

The party seemed to ignore the fact that during 2014, the increase in fiscal deficits failed to have any expansionary impact on the economy, which did not grow at all. The perception that the president had no political support of her own, however, stimulated her adversaries to aggressively advance proposals for her impeachment, based on whatever reason one could find, or the annulment of the election itself, or if nothing else worked, to force her to resign. With an aggressive opposition and unable to count on a supporting political base, the government was paralyzed for the whole year.

No relevant austerity measure has obtained Congress’ approval. Despite the effort of leftist parties to blame the pro-austerity Finance Minister Joaquim Levy for the contraction of the economy, it is impossible to ignore the fact that the failed attempts to get the proposed policies approved by Congress just made explicit the lack of political power that characterized Rousseff’s position. The impasse created by the inexistence of an effective government in the face of an aggressive opposition led decision-makers to postpone any but the most immediate decisions. Investment has fallen, workers have been fired in increasing numbers, consumption has been negatively impacted, etc.

The political crisis has transformed an expected recession into something that threatens to become a major depression, both in depth and duration. The situation is made more difficult by the difficulty to visualize any sustainable solution for the crises in the mediate horizon, let alone the coming months. If the impeachment process prospers, one could expect for sure increased political instability as a result, on the one hand, of attempts by PT and the social movements that are close to it to react somehow, and, on the other, by the fact that there is no organized opposition ready to take the place of the current administration. If the impeachment initiative is defeated, the problem remains that the president does not have any vision or power and it is overwhelmingly difficult to imagine how she could recover enough initiative to last the three remaining years of her term in office.

Paraphrasing the late historian Eric Hobsbawn, who observed that the Twentieth Century had been very short (beginning in 1914 and ending in 1991), 2015 may be a long year for Brazilians. The incompressible minimal duration of an impeachment process will take it to 2016, when the social situation may be more tense than it is now, with high inflation and increasing unemployment. If a national agreement of some sort, be it in terms of allowing Rousseff’s government to work or by removing it altogether, is not reached to avoid the worse, 2015 can last even longer. The country may dive into an unknown abyss of a combination of economic, political and social crises of which it is hard to see how, when and in what conditions it will recover.

(End)

Excerpt:

By Guillermo Medina
MADRID, Dec 22 2014 (IPS)

Political and institutional corruption has become the main concern of Spanish citizens after unemployment and the dramatic social consequences of the economic crisis, according to opinion polls.

The systemic nature of corruption – recognised by most analysts but denied by Prime Minister Mariano Rajoy of the right-wing People’s Party (PP) – is coinciding exasperatingly with the impoverishment of most of society and the enrichment of a few of its members, leading to a rejection of current politics and institutions that verges on social rebellion.

In the 2011 municipal elections, 39 percent of candidates under investigation for corruption throughout Spain were re-elected, according to a report by the Politico analytical group. Some notoriously corrupt officials even claimed that the “favourable judgment of the electorate” was a kind of absolution.“The systemic nature of corruption is coinciding exasperatingly with the impoverishment of most of society and the enrichment of a few of its members, leading to a rejection of current politics and institutions that verges on social rebellion”

But indifference towards corruption was transformed into intolerance when the crisis arrived and scandals began to emerge.

In October 2004, a poll by the Centre for Sociological Research (CIS) found that only 0.6 percent of respondents mentioned corruption among their main concerns; by October 2014, according to the same source, 42.3 percent were naming it as their second-highest concern.

Citizens have now made a direct connection between corruption and the crisis, profligacy, unemployment, impoverishment, inequality and a political style. Irritated and provoked by their observation of the obscene ostentation and impunity of the corrupt, many have reached the conclusion that it will not be possible to eradicate corruption without profound change.

In the view of many Spanish citizens, corruption has its origins in a model of party politics that reduces democracy to a mere mechanism for deciding – every four years – which party will occupy the seats of power, with no substantial change for the people.

The meteoric rise of Podemos (“We Can”), the movement and political party proposing radical change, is therefore not surprising. Founded in January this year, Podemos secured 25 percent of voter intentions in a survey published on Dec. 7 by the newspaper ‘El País’.

Due to deficiencies in the electoral law and certain flaws in their original make-up, the other parties have thwarted the wishes of the electorate and have created a crisis of representation.

Frequently, lax laws, long criminal proceedings, short statutes of limitations and the most varied tricks of judicial ingenuity conspire to grant impunity to conduct that is harmful to the common interest and causes public scandals.

No wonder Carlos Lesmes, president of the General Council of the Judiciary, said recently: “We have a criminal system devised to penalise the petty thief, but not the large fraudster; it does not work in cases such as we are seeing now, in which there is so much corruption.”

People today are aware of the relationship between politics and corruption. One of the most pernicious effects of this omnipresent phenomenon is that it monopolises and conditions political debate, weakening institutions like Congress and the government itself, which should be focusing their attention on solving the country’s crucial problems.

Politics are deadlocked. Accords have become unviable because the country is divided by two contrary and reactive forces, between those who are enraged at the “caste” and are seeking a radical alternative, and those who are frightened by what they rightly consider to be a threat to their interests and prioritise attacking their rivals, while trying to convince us that they are fighting corruption.

At this point, the corruption and disrepute of the political class has resulted not only in the growth of Podemos, but is perceived as a curse even by the business community, which sees it as a hindrance to economic recovery.

A survey among the 500 participants at the recent National Congress of Family Business awarded only 1.08 out of 9 points to the political situation. Last year the result was 1.66 out of 9.

Democracy does not create corrupt people, but corrupt people end up corrupting democracy, and then corruption becomes a structural, systemic problem. Multiple abscesses turn into gangrene and after that, ending corruption means cleansing the entire system.

Fighting corruption is only possible in the broader context of political and institutional regeneration. So it seems to those who demand regeneration, and because they feel that the established parties are lacking in political will, they state their intention to vote for Podemos.

The anti-corruption measures proposed so far by the government are uninspiring and lack depth because they do not make the necessary connection between corruption and political regeneration. The opposition Spanish Socialist Workers’ Party (PSOE) goes further than the PP although its proposals are also inadequate and somewhat vague.

It is impossible to fight corruption effectively without reforming the bipartisan model, introducing internal democracy and carrying out a thorough reform of the system of justice to guarantee the independence of the judiciary, as judges and magistrates are demanding.

Political corruption goes hand-in-hand with the exercise of power, whether in Andalusia (PSOE), Catalonia (Convergence and Union), Valencia (PP) or Spain as a whole (PP). Therefore the existence of regulatory institutions, a real separation of powers, and free and independent media are essential for combating it.

Even if it is accepted that ending poverty and unemployment is more important than regeneration, I do not see how the former can be achieved without the latter.

The idea that the economic crisis has generated a political crisis is widespread, but the reverse is equally true, so we are up against the question of which came first, the chicken or the egg.

For a time, the Spanish government has tried to face the economic crisis, leaving aside the political crisis, with dire consequences. Unfortunately the Prime Minister does not take this view and believes instead that the long-heralded economic recovery will be the panacea for all ills. The results are clear for all to see. (END/IPS COLUMNIST SERVICE)

(Edited by Phil Harris)

The views expressed in this article are those of the author and do not necessarily represent the views of, and should not be attributed to, IPS – Inter Press Service. 

Excerpt:

“It’s like putting explosive, gasoline and matches all in one shed. These are things that should be stored in separated places.”

Giuseppe Giorgioli, an inhabitant of the Tor Sapienza district of Rome and a member of the Tor Sapienza Committee, was explaining the mid-November outburst in the district against a reception centre for asylum seekers and refugees, in which dozens of paper bombs were thrown.

The Tor Sapienza district, situated in the east side of the Italian capital, is home to almost 13 thousands citizens and, according to Giorgioli, is treated as a “second class quarter” by the Rome administration because of its relatively small dimensions.Episodes like the attack on a reception centre for asylum seekers and refugees “are being worsened by a growing poverty that now affects 13 million people in Italy, with 42 percent of young people unemployed” – Monsignor Giancarlo Perego

“For the last 10 to 15 years there has been a progressive phenomenon of disruption-parking in our suburb. This is how we ended up hosting four reception centres for migrants and two gypsy camps, while other districts in the city have none,” Giorgioli complained.

The residents’ uprising followed an alleged attempt of rape by a Romanian citizen against a local resident and a series of attempted robberies in apartments in the neighbourhood.

The Tor Sapienza Committee had organised a demonstration to ask the Rome Town Council to act against the urban decay the neighbourhood is suffering but once the march was over, a group of people – about one hundred according to witnesses – gathered in front of the building where the ‘Il Sorriso’ cooperative manages different services, including a reception centre for asylum seekers and refugees and three structures hosting foreign unaccompanied minors.

“When I arrived in the centre the following morning, I found huge pieces of asphalt, broken glass and people – both adults and minors – suffering from panic attacks,” recalls Alessia Armini of Italy’s System of Protection for Asylum Seekers and Refugees (SPRAR), who is coordinator of the cooperative. “Let’s not forget the kind of vulnerable guests we have in such centres,” she adds.

While no one denies the critical conditions suffered by many suburbs in Rome, with cuts in transport services, council houses not having been refurbished for decades and inefficient garbage collection among others, the explanations for such a violent outburst vary widely.

“People are not racists, they are exasperated. Rome is just the tip of the iceberg, but this is about the whole country,” Paolo Grimoldi, MP for right-wing Northern League party, told IPS. “When you receive 150 thousand migrants – we say illegal, the government says refugees – in one year who are given a house, money and are taken care of by the State, this inevitably destabilises our social fabric.”

However, according to Monsignor Giancarlo Perego who runs Migrantes, the foundation of the Italian Episcopal Conference (CEI) for migrants, the numbers tell a different story: “Migrants are abandoning our country because it no longer represents an economic opportunity for many of them,” he told IPS.

“The reasons must be found in a management of the suburbs that looked at the interests of building speculators rather than guaranteeing common assets such as meeting places that are necessary to build a feeling of safety within a territory.”

In addition, the economic crisis also plays an important role also in this context. “Episodes [like the Tor Sapienza] incident are being worsened by a growing poverty that now affects 13 million people in Italy, with 42 percent of young people unemployed,” said Perego.

“But such a difficult situation does not exempt us from the need of building relationships, delivering correct information and managing the places where people live in order to encourage encounters and not social clashes.”

For their part, the citizens of Tor Sapienza firmly reject any accusation of racism. “We welcome everybody and we’ve been welcoming everybody for twenty years,” Giorgioli told IPS.

“You don’t become racist in four days. But there are rules that need to be respected and services that the town council needs to provide. If such services are not provided, unfortunately someone with less patience begins to see red.”

In the days that followed the attack on the reception centre, both local and national politicians visited the neighbourhood, provoking strong criticism – and not only from angry citizens – that they were using the situation for instrumental reasons.

“I think that any form of manipulation, whether from left or right, is a serious aspect to be avoided. Politicians must govern a city, not pour in new reasons for social clashes,” Perego said.

Meanwhile, the violent episode in Tor Sapienza and signs of social unrest in other Italian neighbourhoods that have sparked debate and drawn attention to the migrant issue are not to be underestimated.

“In these suburbs, the level of social distress is extremely high, but all that hate, taking a symbol and pouring everything out on it … it’s frightening,” said Armini. “We heard people [outside the centre] screaming ‘let’s burn them all, let’s make soap out of them’. This issue brought out the worst in people.”

While condemning the recent violence, Giorgioli of the Tor Sapienza Committee is not sure that such situations will not be repeated

“I have reasons to fear that the same people who have already shown that they are capable of violent actions will repeat them if there are no signs of change. They could feel disrespected, as if the institutions were making a fool of them.”

(Edited by Phil Harris)

Yomara receives tutoring in the Portada Alta school in Málaga, Spain. Credit: Inés Benítez/IPS

By Inés Benítez
MÁLAGA, Spain , Dec 11 2012 (IPS)

Daniel introduces himself as a “gypsy and guitarist,” Francisco José wants to become a doctor, Yomara timidly says she likes to cook, and María has no idea what she wants to study.

The 12 to 17-year-old students at this school in the southern Spanish city of Málaga belong to the Roma or gypsy community, which is marked by high dropout and truancy rates.

Despite “noteworthy progress” in educational coverage among this ethnic group in the last 30 years, only 20 percent of youngsters who start secondary school – the first four years of which are compulsory, from ages 12 to 16 – go on to graduate, Humberto García, with the Gypsy Secretariat Foundation (FSG), told IPS.

And he added that not all Roma children enrol in secondary school.

The Council of Europe estimates that the Roma number 725,000 in Spain – 1.57 percent of the population of 46 million.

Although members of this ethic group can be found in every trade and profession, many work as street vendors in markets or as waste pickers of scrap metal and cardboard, which they sell for recycling.

“I didn’t go to high school and I don’t want my kids to be like me; I want them to be able to relate to others and become something in life,” 44-year-old Antonia Martín told IPS.

She is the mother of Yomara (16), José (15) and Jesús (24). She also has a two-year-old grandson.

At her side, her husband Antonio Campos, whose parents were basket-makers and who has worked at a golf course on the Málaga coast since he was 17, says “the gypsy mentality has to change. They think they have to live like our grandparents did. But today there are more opportunities, and we can live better, with more education, and receiving more respect.

“Being a waste picker, junk collector or street vendor is not a good life – it’s feast today, famine tomorrow,” said Campos, who called for “breaking down the barriers” imposed by the traditional lifestyle of Spain’s gypsies, or calós.

Caló is the language of Spain’s gypsies, who gradually lost their Romani language. It is also another name for the Roma community in this country.

In Spain, the term gitano or gypsy is not considered derogatory, although that does not mean that this country is free of the discrimination suffered by the Roma, Europe’s largest ethnic minority.

Until the end of General Francisco Franco’s dictatorship in 1975 and the adoption of a new constitution in 1978, the Roma people did not have the same rights as the rest of the population.

But since then, school enrolment has climbed from extremely low levels to 93 percent today.

“Education and employment are two essential factors for the integration of the gypsy community,” said the FSG’s García, whose Promociona (Promote) programme works with students, families and schools to lower dropout and repetition rates.

The programme is active in 300 schools in 27 towns and cities around Spain. In Málaga the programme has a staff of four women who work with around 50 students and their families and teachers.

The four workers arrange home visits with the parents and tutoring workshops in the classroom, like the one that brings together Daniel, Yomara, María, Francisco José and other students in the Portada Alta school in Málaga every Tuesday.

“We are focused on fighting truancy and getting the families involved, because they don’t see the importance of education,” biology teacher Isabel Passas, from the Guadalmedina school, where 80 percent of the students are Roma, told IPS.

Passas lamented that a majority of the girls drop out by the age of 14, when they are married off in arranged marriages and start having children of their own.

Martín doesn’t want her 16-year-old daughter Yomara to get married yet. “I won’t let her get married so young, and she doesn’t want to either. It’s really backwards to get married and have children so young; there’s time enough for that,” she said.

When she was little, Martín, who comes from a family of 10 children, used to help her mother sell fruit and clothing on the streets.

Many parents depend on their children’s help in street vending, and pull them out of school early, the vice principal of the Portada Alta school, María Victoria Toscazo, told IPS.

The economic crisis that is rocking Spain has also hurt the traditional open-air markets.

According to Campos, who has relatives who work as market vendors, “people are hardly selling anything, and competition (from immigrants) is really tough.”

The study “Gypsy population, employment and social inclusion”, published this year by the FSG, reported that unemployment among the Roma in Spain grew nearly threefold between 2005 and 2011, to 36.4 percent.

And while unemployment among the Roma was five percentage points above the overall unemployment rate in 2005, today the difference is 14 percentage points.

“The crisis has affected everyone, but it has had a more severe impact on the most vulnerable,” said García.

Moreover, “society still has a really negative view of us, and social rejection is strong,” he added.

It is hard to encourage Roma youngsters to continue studying when they are aware that discrimination will likely make it difficult for them to find a job.

Language and literature teacher Antonio Blanco, who has spent four years teaching Roma children at the Guadalmedina school, stressed the importance of forging emotional ties and creating a pleasant environment, to keep children in school.

Nevertheless, the Roma in Spain are better off than in the rest of the European Union.

“There are problems, but not as many as in France, Romania or Portugal,” a source at the FSG told IPS.

Like the rest of the population, Spain’s Roma people are covered by the universal public healthcare system and have access to affordable housing programmes for low-income families.

Most Roma live in working-class neighbourhoods, and only a small proportion actually live in slums. But the stereotype of the wandering, thieving gypsy lingers.

The question is how far to integrate in a society that discriminates against them. Martín’s relatives say she and her family are “apayaos” (roughly meaning assimilated to the “payo” or non-gypsy culture).

Her husband argues that “gypsies should not be all bunched together, but spread around, to adapt to another way of life.”

Thirty people eat lunch every day at the Emaús soup kitchen in Torremolinos, on the outskirts of Málaga. Credit: Inés Benítez/IPS

By Inés Benítez
MÁLAGA, Spain , Nov 14 2012 (IPS)

A huge pot of rice steams on the stove at the soup kitchen run by Emaús in the municipality of Torremolinos, on the outskirts of this southern Spanish city. This morning, like every other, Pepi, Adriana and Diego are cooking for over a hundred people who can no longer afford to feed themselves.

As the already record-high unemployment rate climbs and growing numbers of people are evicted from their homes because they cannot keep up on their mortgage or rent payments, the economic crisis in Spain has also led to an upsurge in the number of people depending on soup kitchens, most of which are run by non-profit organisations or private foundations that receive government funding.

“My mother is out of work and she has three children,” Dominican immigrant Dariana, 18, tells IPS while stopping by the Emaús soup kitchen at noon to pick up servings of rice, salad, sandwiches, bread and fruit for the four members of her family.

Emaús, a Catholic humanitarian organisation with six employees and numerous volunteers, delivers meals to the homes of sick and elderly people as well as distributing food at its headquarters in Torremolinos. At around 12:30 every day, people begin to queue up, waiting to take away bags of food. An hour later, others will sit down to eat lunch in a dining hall with room for 30.

“I never imagined that I would have to come here and ask for food,” remarked Jessica, 29, holding her two-year-old daughter Janira’s hand. She lives in her mother-in-law’s house, but has been coming to Emaús for two months because she and her husband have both lost their jobs and have no income anymore, “and there are four mouths to feed,” she told IPS.

In the past few years, poverty has become “more extensive, intensive and chronic” in Spain, according to a recent report by the Spanish branch of Caritas, another Catholic organisation. Food is one of the “basic needs in highest demand” in Spain, followed by housing and employment, the report says.

More than 21 percent of the population of 47 million is living below the poverty line this year, according to the Economically Active Population Survey conducted by the National Institute of Statistics (INE). The survey also found that 12.7 percent of households have difficulty making ends meet at the end of the month, and 7.4 percent are behind on the payment of housing-related costs.

The poverty line is currently set by the INE at 7,355 euro (9,339 dollars) for a one-person household.

“There are more and more people asking for food. It’s overwhelming,” Pepi comments to IPS while stirring the rice. “Most of the people we help have homes, but they can no longer afford to buy food.”

Working alongside Pepi is Diego, who is unemployed and has volunteered at Emaús since July. He is putting the finishing touches on the salad, while Adriana, who came to Spain from Uruguay in search of a better life, is busy chopping Swiss chard that will later be stored in freezers.

The president of Emaús, Antonio Abril, told IPS that the profile of people who use soup kitchens has changed since the global crisis that erupted in 2008 in the United States spread to Spain and other countries of the European Union.

In the past, the organisation almost exclusively served the elderly. But today its clientele has expanded to include “younger people who live on the street or are squatters or have been evicted.”

To eat at Emaús, “the only requirement is to be poor,” said Abril.

The people who come to the organisation for help are referred by the Málaga city government’s social services and must be registered residents of the municipality, Luis Romero told IPS. Romero, a retired teacher, was one of the three founders of Emaús in Torremolinos 16 years ago. The organisation also runs soup kitchens in Estepona, in the province of Málaga, and in Guadix and Baza, in neighbouring Granada.

Every day, two Emaús workers head out in a van to pick up donations of fruit, vegetables and other food products from the Málaga food bank, private businesses and charitable foundations whose contributions make it possible to prepare free meals from Monday to Saturday.

At 1:30 in the afternoon, the dining hall at Emaús headquarters in Torremolinos is ready for 30 diners. The tables are covered in pink tablecloths and set with plates and cutlery. The walls are decorated with religious-themed paintings, crowned by a large wooden cross and two cages with bright yellow birds.

“Thank goodness we are here and we can survive,” Marco comments to IPS while eating rice. Originally from Poland, Marco lost his construction job four years ago, and has been eating at the Emaús dining hall for the past year. He lives with his sister and niece, who are also unemployed, and is six months behind on his housing payments.

Due to the rise in unemployment, which is over 25 percent – the highest rate in the EU – a growing number of people can no longer meet their mortgage payments and are consequently evicted. But even when they end up on the street, they still owe the bank the pending payments.

Sitting at the table with Marco is Halina, a Belarusian woman with short curly hair. After she arrived in Spain in 2003, she found work in the hotel industry. But she lost her job, her welfare benefits ran out, and now she has “nowhere to sleep.”

The oldest of the diners is 94-year-old Encarnación, who has put on bright red lipstick for her visit to Emaús. She comments that “lately a lot of young people have been coming here to eat because there’s no work.” Romero adds that, normally, there are more men than women at the lunch tables, and regulars include immigrants, people who sleep in cars and doorways, and a few mentally ill people.

“There has been a remarkable increase in middle-class people who have found themselves forced to ask for food,” volunteer Felisa Castro, one of the founders of Ángeles Malagueños de la Noche (Málaga Angels of the Night), told IPS.

Founded three years ago, this non-profit organisation runs on donations and the work of volunteers who deliver hundreds of breakfasts, lunches and dinners daily. The meals are prepared in a small house in a central neighbourhood of Málaga, this southern Spanish city that for many years was a popular destination for immigrants seeking a better life.

Nyan Tuch in her temporary home in a camp outside of Aweil where she is living until the government provides her family with land. Credit: Jared Ferrie/IPS

By Jared Ferrie
JUBA, Jul 9 2012 (IPS)

The streets have been swept clean and lined with flags to mark the first anniversary of South Sudan’s independence. But cosmetic changes in the capital, Juba, mask deep concerns about the future of the world’s newest nation.

South Sudan’s first year of independence has been marred by violent clashes, food shortages, a refugee crisis and a faltering economy that threatens to halt development. As the nation celebrates its liberation from Sudan after a civil war that killed an estimated two million people, messages from the international community were decidedly muted.

“Looking back, the last year has clearly been a difficult one for the people of South Sudan,” Hilde Johnson, the United Nations secretary general’s special representative, told reporters in Juba on Friday, Jul. 6. “It’s been a tough start.”

In a strongly-worded statement read out at the United States embassy’s July 4 celebrations, Secretary of State Hillary Clinton warned that the country faces “significant challenges that threaten stability and prosperity.”

“Conflict and unresolved issues with Sudan and domestic inter-ethnic tensions have led to increased fighting and economic hardship, which threatens to compromise the very foundations upon which South Sudan’s future was to be built,” she said.

Much of South Sudan’s future was tied to oil. The country inherited three quarters of Sudan’s reserves when it separated, but the pipelines and processing facilities remain north of the border, along with the port that South Sudan needs to use to get its oil to market.

It was thought that the countries’ mutual interest in oil revenue would help foster a working relationship between the former civil war foes. But it has not worked out that way. Talks since independence have failed to yield an agreement on how much South Sudan should pay to ship its oil through Sudan. In late January, South Sudan shut down oil production after Sudan confiscated 815 million dollars worth of Southern crude, which it claimed was in lieu of unpaid fees.

South Sudan said it had no choice but to halt production because Sudan was “stealing” its oil. But in doing so, the government deprived itself of 98 percent of its revenue. Already greatly dependent on the international community for aid, donors are now concerned that South Sudan will now be unable to fund any development programmes or even pay public sector salaries, which could lead to civil unrest.

“We must not allow the large investments in agriculture, water, education and other services to be undone by the economic crisis and increase in conflict,” said Helen McElhinney, a policy advisor with Oxfam International. “The longer this crisis drags on, the greater the risk South Sudan’s development will slip backwards, and its vast potential will be unrealised.”

Alfred Lokuji, dean of Juba University’s Community and Rural Development Studies department, said an agreement to restart oil production would not solve South Sudan’s problems.

“Even if the oil were flowing, the fundamental problem remains – how to manage it, how to manage those resources,” he said.

Lokuji pointed out that South Sudan and Sudan split oil revenues 50-50 in the five years leading up to independence, but southerners have seen very little development. Instead, oil wealth has been squandered and stolen.

On May 3, President Salva Kiir wrote a letter to 75 former and current “senior” government officials asking them to return stolen public funds. He said that four billion dollars had been looted.

Lokuji said that the letter was unlikely to succeed in convincing people to return money lost to corruption, or to prevent officials from stealing more. He criticised the government for failing to bring charges against corrupt officials during South Sudan’s first year of independence.

“I’d say it has been a failure, a failure because we have been unable to get a hold of corruption, unable to put things in order, put institutions in order and get going,” he said.

Even as the economy stagnates after the loss of oil revenue, humanitarian needs are increasing. The number of people requiring food aid in 2012 doubled from the previous year to 2.4 million, according to the U.N. Some of those are people displaced by ethnic violence that is most pronounced in Jonglei, an eastern state bordering Ethiopia.

More than 1,000 people died in fighting between the Murle and Lou Nuer ethnic groups in Jonglei in 2011. At least 900 more died in clashes that began in late December and stretched to February, according to a May 25 report by the U.N. peacekeeping mission.

The report noted that U.N. surveillance flights had reported around 8,000 Lou Nuer marching toward Murle communities in the weeks leading up the December attacks. Despite advanced warning, “the government was slow to respond in any robust way.”

“Actions taken came too late and insufficient troops were deployed at the critical time,” the report said.

South Sudan is also struggling to cope with close to 200,000 refugees that have crossed the border from Sudan’s Blue Nile and Southern Kordofan states where the Khartoum government is fighting an insurgency. On Jul. 4, U.N. High Commissioner for Refugees Antonio Guterres warned that people are arriving “dangerously malnourished” to camps where “the threat from water born disease is high.”

In addition to refugees, about 375,000 southerners have returned from Sudan since October 2010, according to the International Organization for Migration. The government has promised to provide land to them but many remain in temporary camps.

In one camp outside of Aweil, the capital of Bahr El Ghazal state, 50-year-old Nyan Tuch has been waiting almost 20 months for the government to give her family a plot of land. She lived for four decades in Sudan where she and her husband were both employed and owned a house. As the referendum on whether the south would separate loomed, tensions increased and they decided to return to their homeland.

Tuch and her husband now live in a thatched hut with a tarpaulin roof and they farm vegetables to survive. But she said she has no regrets about returning.

“I am filled with joy at one year independence it is now a country of our own,” she said. “What we are looking for is for the government to allocate our land. And we are hoping the place we have will be better than the place we left in the north because this is our place, we are proud of it.”

A nurse attends to an expectant mother at Walgak Primary Health Care Centre in South Sudan's Jonglei State. Credit: Charlton Doki/IPS

By Charlton Doki
JUBA, Jul 9 2012 (IPS)

One year after the formation of South Sudan, the country’s women say that independence has not resulted in the positive political, economic and social changes that they had hoped for.

Women activists worry that even after separation from Sudan on Jul. 9, 2011, when South Sudan became the world’s newest country and Africa’s 54th nation, the government has not done enough to improve the lives of its women.

But as people across the country celebrate the first anniversary of independence from Sudan, after a 21-year civil war, the year has been fraught with crises.

The country is in the midst of an economic crisis after South Sudan’s decision in January to shut down oil production, which accounts for 98 percent of the its revenue, following a dispute with Sudan over fees charged to use its pipelines.

There is also dire food insecurity here. In June, the United Nations World Food Programme said that more than half of the country’s 8.2 million people would need food aid by the end of the year.

In the country’s Upper Nile state, the Jamam refugee camp is on the verge of a humanitarian crisis. The camp is home to some of the 200,000 refugees who, according to the U.N., have fled the conflict in Sudan’s Blue state.

However, Médecins Sans Frontières has warned that the mortality rate among children at the camp was 2.8 per 10,000 per day. This figure is above the emergency threshold of two per 10,000.

Amidst all of this both women leaders and activists admit that they had high expectations of the country’s first year. Some feel that the reality of independence has failed to live up to the hype and euphoria.

“We had high expectations, but I think they are not unrealistic and should not be pushed aside. Women are doing badly politically, economically, socially and education wise. The government needs to take measures to address the challenges facing women so that they can truly enjoy life in their new independent country,” Lorna Merekaje, of the South Sudan Domestic Election Monitoring and Observation Programme, told IPS.

Others disagree.

The Central Equatoria state Governor’s advisor on conflict resolution, Helen Murshali Boro, said that women’s concerns would be addressed.

“There is freedom of speech to allow women to express themselves and this means women’s concerns will not go off the radar until they are addressed in the coming years of our country’s independence,” she said.

Though the reality still remains far different.

“Like in the past when South Sudan was still part of Sudan, today women live in poverty,” said Lona James Elia, executive director of a local women’s rights agency, Voice For Change.

The National Baseline Household Survey (NBHS), conducted in 2009 and released in June 2012, indicates that over half of South Sudan’s 8.2 million people live below the poverty line on less than a dollar a day. The majority of the poor are women.

Elia added that South Sudan is still unable to provide maternal health services to the country’s women, especially in rural areas.

According to the U.N. Children’s Fund only 19 percent of births are attended by a skilled health worker. According to the NBHS, 30 percent of the population has no access to basic health services.

The few available health facilities lack supplies and qualified personnel to provide the required services. And in some rural areas women cannot receive maternal and antenatal care because they live too far from the nearest maternity clinic. Thirty-seven percent of poor households have to travel for more than an hour to reach their nearest most-used health facility, according to the NBHS.

“Women are still dying while giving birth. They are still not accessing maternal health services. A woman is not supposed to die because she is giving birth to a new life, a new baby. This is not acceptable,” Elia told IPS.

According to the National Bureau of Statistics, in 2011 the country recorded that 2,054 out of every 100,000 women died during childbirth. The high mortality rate has not changed much a year later, according to the U.N. Population Fund (UNFPA).

In June, Kate Gilmore, assistant secretary-general and deputy executive director (Programme) of the UNFPA, told reporters in Juba that maternal mortality rates in South Sudan remained the worst in the world.

“The latest evidence that we have is that using standard figures in every 100,000 births there are over two thousand women who die from preventable causes in South Sudan. In Afghanistan, which surely is one of the most troubled countries in the world, it is half that. Across Africa it is five hundred,” she had said.

Elia said the government needed to invest in maternal health services to ensure that women could participate in developing the country.

“A mother should not have to travel all the way from Gondokoro to Juba to deliver a baby because there is no hospital in her home city,” Elia said. Gondokoro is about 20 km from Juba and also within Central Equatoria state. She added that because the nearest health care centre was too far, some women died along the way.

However, government spokesman Barnaba Marial Benjamin said that the government had worked hard to improve living standards.
“We have initiated projects, including building schools and health centres, which will benefit all South Sudanese citizens, including women,” he told IPS.

In addition, the government has implement an affirmative action policy that ensures 25 percent women’s representation in all government jobs at national, state and county levels.

“You see after independence the president appointed six women to the cabinet and about nine to 10 assistant ministers. I think with about 16 women in the national government, the government has responded positively,” said Boro.

Currently there are four female ministers out of a total of 29, and eight female assistant ministers from a total of 27.

However, activists say that this has not directly affected the lives of the country’s women.

“When you look at the middle-class women and those at the grassroots they are still not in positions where they can make decisions that benefit women,” Merekaje told IPS.

Boro admitted that women still occupy low entry positions in the work field.

“Although these days you see more women coming to work in the morning, at the end of the day they go home with peanuts because they work in the less-paid, low positions,” Boro said.

Elia said that women were unable to find employment because the majority are illiterate and do not have the vocational skills required by employers. According to the National Bureau of Statistics, 88 percent of South Sudanese women are illiterate. In addition, the U.N. says that only one percent of girls complete primary school.

“Women are the most illiterate and because, despite the independence of our country, women at the grassroots level still remain the most underprivileged segment of society as they have to depend on men for survival,” Elia told IPS.

Jerisa Yide is one such example. The 65-year-old grandmother earns a living breaking stones and rocks into gravel, which she sells to builders.

“I used to crash stones before independence to enable me to pay my grandchildren’s school fees. We are now independent, but we are even paying more fees for our children to go to school,” said Yide.

Primary and secondary school education are not free in South Sudan. And as a result of the shut down on oil production, the government introduced an austerity budget in January where it scrapped free university education.

Yide said that when she voted for independence she expected the government to provide better services, including education and health.

Selina Modong agreed that not much had changed. She said that the cost of living in Juba had increased since independence. As a result of the economic crisis, inflation has soared to a staggering 80 percent in May.

“I was eating one meal per day before independence. Today I still eat one meal per day and sometimes we hardly eat good food these days,” Modong said.

“I think independence has not changed anything for us poor people,” Modong concluded.

Elia said that everyone should participate in ensuring that the women’s agenda is addressed.

“If you want this independence to benefit everyone, the issue of women should not be for women alone. It should be for everybody. Let us ensure that our daughters have a bright future. That they will get the education they want, that they will get the employment they want and that they will get the health services they deserve to build healthy families for themselves,” said Elia.

By Mathilde Bagneres
UNITED NATIONS, Feb 22 2012 (IPS)

The phrase “financing for gender equality” may sound dry, but it lies at the heart of some of the most intractable problems faced by women around the world today – and whether the political will exists to allocate real resources to solving them or simply pay lip service.

Beginning next week, from Feb. 27 to Mar. 9, ministers and civil society delegates will meet at the United Nations for the 56th session of the Commission on the Status of Women (CSW).

This year’s meeting is especially critical because it will assess how governments have made good on promises at the 52nd session in 2008 to boost financing for gender equality and the empowerment of women.

Stephanie Seguino. Credit: Courtesy of Stephanie Seguino

The topic covers everything from broader macroeconomic policies, to public finance and gender responsive budgeting, the mobilisation of international resources and aid, and finding new and innovative sources of funding.

Stephanie Seguino, an economics professor at the University of Vermont in the United States, will take part in the CSW discussions as a member of a panel on “national experiences in implementing the agreed conclusions of CSW 2008”.

IPS Correspondent Mathilde Bagneres talked with Seguino about how women are particularly affected by the current economic crisis, and the role of government in crafting policies that promote not only women’s equality but sustainable development for society as a whole. Excerpts from the interview follow.

Q: Low wages and underemployment of women have been a persistent problem around the world, long before the latest financial crisis. How can financing for gender equality address these issues?

A: Some of the problems of women’s lower wages and underemployment can be addressed through gender-aware targeting of public expenditures as well as anti-discrimination policies. Clearly, policies to promote girls’ education, including publicly funded education, are key.

However, more than that, policies to reduce women’s care burden and policies to promote men’s participation in unpaid caring labour – such as paternity leave – free up women’s time to engage in paid work.

Also, public investment in infrastructure that improves women’s access to health care – rural health clinics, skilled health personnel – and reduces the time they spend fetching water and fuel, or moving goods to market helps them engage in productive activities.

Training programmes that target women, especially for non-traditional “male” jobs, are important. In agricultural economies, governments can offer loan guarantees where women lack title to land in order to leverage their access to credit.

(But) even these steps will be insufficient to undermine pay inequality. Governments need to assertively develop and enforce anti-discrimination legislation, AND affirmative action programmes. Governments can serve as role models by ensuring that some minimum level of leadership positions is filled by women – 30 percent or more.

Q: The 2008 CSW Declaration expressed concern about “the growing feminisation of poverty”. Is this a trend that is likely to continue in the near future?

A: The forces of globalisation continue to push down the wages of workers, and result in a squeeze on public sector budgets (because of the declining corporate tax burden and reductions in tariff revenues).

As a result, women are likely to fare poorly, especially in the context of high unemployment. This is because men tend to be seen as more deserving of jobs when jobs are scarce.

Until we resolve these negative macroeconomic pressures that result in slow growth, job shortages, and growing inequality, it will be difficult to resolve the problem of women’s poverty and that of the children they care for.

Q: You have written that “This crisis provides the opportunity to rethink the role of government in the economy”. Can you briefly elaborate on that idea?

A: This crisis has its roots in the global deregulation of economies, leading to market failures, the growth of inequality, along with increased economic insecurity.

Firms have pursued profits often at the expense of broadly shared well-being. This is not to condemn corporations for their behaviour. Firms seek to maximise their profits in the context of societal rules that regulate their actions.

This poses two challenges for governments. First, they must identify and enforce a set of rules and regulations that are sufficiently flexible to permit firms to innovate while also requiring firms to align their profit motives with social well-being. To give an example, firms try to reduce their costs to raise profits.

They can do this by lowering wages or by innovating and thus raising their productivity. Their choice about which path to cost reduction to take will depend on the set of incentives that governments set.

If a government sets and enforces a minimum wage, firms will be constrained to innovate as a way to compete, which is a good thing for the firm, workers, and society as a whole.

Second, governments have an important role to play in investing in key areas to “crowd in” private investment. For example, investment in infrastructure and education is good for business because it reduces their costs. It is also good for citizens as a whole. The challenge is to carefully target those expenditures so that they do succeed in stimulating business investment that leads to higher incomes.

A related challenge is to identify gender-enabling investments. As I noted above, some public spending that had previously been thought of as social welfare is in reality social infrastructure investment – e.g., education, health, and conditional cash transfer programmes.

They are investments because they improve the productive capacity of the economy, yielding a stream of benefits into the future, which can be used to pay down the debt incurred to finance these expenditures.

The concept of social infrastructure is not well developed. It is an important one, and is an important avenue for promoting gender equality in ways that are financially sustainable.

Excerpt:

The flood of economic woes devastating Greece and Portugal are evidence that the German prescription imposed by a troika of multilateral creditors is not working, and that both countries are heading into a blind alley, says economics professor Mario Olivares.

“National debt and fiscal deficit problems can only be overcome by economic growth,” Olivares, a Portuguese academic, told IPS.

The harsh austerity programmes prescribed by the International Monetary Fund (IMF), the European Union and the European Central Bank (ECB) are dragging Greece and Portugal into a downward economic spiral.

In these two southern European countries, and more recently in Spain and Italy as well, “growth and investment are being sacrificed, creating an alarming increase in unemployment,” said Olivares, head of the economics department at the School of Economics and Management (ISEG) of the Technical University of Lisbon.

“There is colossal pressure on the Greek economy, which has already seen a fall in GDP far greater than forecast, due to an adjustment model that isn’t working because, in spite of wage cuts, exports are not increasing,” he said.

The crisis in Spain, Portugal and Greece, “with cuts in consumption and public spending, as well as slower growth in Germany, the Netherlands, France and Belgium, change the scenario, because the expected increase in exports is not happening,” Olivares stressed.

In the case of Portugal, public accounts are being regulated with iron discipline in order to meet the fiscal deficit goals demanded by German Chancellor Angela Merkel, whom Olivares describes as “master of the EU” in contrast with the weakness of the European Commission, the bloc’s executive arm.

Economic analysts agree that the wage cuts, longer working hours, cancellation of several public holidays and tax hikes have led people in Portugal to spend less and save more, not to create a solid foundation for stability, but to sink further into poverty.

The recession deepened in the last quarter of 2011 because of contraction in household consumption and only modest investment, factors that brought about a 2.7 percent fall in GDP that quarter, and an annual average shrinkage of 1.5 percent of GDP with respect to 2010, according to the National Institute of Statistics (INE).

The INE report predicted that “acceleration of the recession in the last three months of 2011 will set a trend that will also blight 2012, during which we expect a new fall in private consumption.”

The most recent estimates forecast a three percent drop in Portugal’s GDP this year.

A crucial factor is that Portugal’s 20 largest companies invested 23 percent less in 2011 than in 2010, which severely affected economic growth and produced drastic job losses.

In its report released Feb. 15, INE said unemployment in the fourth quarter of 2011 reached 14 percent, the highest jobless rate in Portugal since records began to be kept. Youth unemployment is even worse, at 35.4 percent.

But the situation is much worse than the official figures suggest, as INE recognises only 770,000 unemployed persons within an economically active population of nearly 5.6 million – a figure that only includes unemployed persons who were available for work, and actively seeking work, during the survey period.

It does not include those who have given up looking for a job, nor people with part-time jobs.

Thus, the real number is almost 1.3 million people out of work, which gives an estimated unemployment rate of 22.6 percent.

Given the fear of contagion of the crisis in the rest of the EU and other parts of the world, IPS consulted Professor Andrés Malamud, who holds a doctorate in social and political sciences and is a research fellow at the Institute of Social Sciences of the University of Lisbon. Like Olivares, Malamud is not at all optimistic about the future.

“In the best-case scenario, the European economy is going to stagnate for several years. The most probable outlook is simply recession, accompanied by social unrest, political radicalisation and institutional fragmentation, with some countries leaving the eurozone and even the EU itself,” said Malamud.

Asked what repercussions such a situation might have in Latin America, he said it would depend on “how far the European economy falls, and whether China has a soft or a hard landing (gentler or more abrupt deceleration of growth).”

Malamud contrasted Brazil, the largest economy in Latin America, “which is adjusting quickly and preparing itself for the shake-up, with  Argentina, which is making tardy, inept adjustments that are unacknowledged in official discourse, as the government talks of ‘fine tuning’ the economy, not ‘adjustment.'”

Olivares, for his part, told IPS that “the European economy is feeling the effects of austerity, with several countries in recession, subjected to concrete austerity plans by the troika or of their own free will, because of higher interest rates on sovereign debt bonds.”

Credit rating agencies “are continuing to lower their ratings of countries and companies, which can be interpreted as a lack of confidence in the fundamental solution for the debt problem in countries in southern Europe, but also as a sign of sluggish economies.”

The repercussions that will be felt in the global economy and particularly in Latin America “have been, so far, a contribution to increased turmoil in financial markets, which in any case have benefited by speculation on sovereign debt bonds,” he said.
Latin America “is at a unique juncture since the 2009 crisis, as the region has gradually shifted its trade towards the Asia Pacific area.”

The region has plumped “primarily for China, its top trading partner at the moment, and has also received enormous amounts of investment from the Asian giant, so that the impact of a European recession can be faced with greater peace of mind,” Olivares concluded.