Latin America

Viscount Montgomery of Alamein Excerpts

Thursday 24th June 2010 Lords Chamber

Moved By

[Viscount Montgomery of Alamein]

To call attention to recent developments in Latin America; and to move for Papers.

[Viscount Montgomery of Alamein]

My Lords, we now turn to more interesting and international affairs. My thanks are due to the Convenor, my noble friend Lady D’Souza, for allocating me time for this debate. It is four years since our previous debate on Latin America and a great deal has happened since then.

Although retired from all business activity for 10 years, I remain a vice-president of Canning House, the Latin American focal point in London. I am glad that two of my fellow vice-presidents—the noble Lord, Lord Garel-Jones, and the noble Baroness, Lady Hooper—will speak. The president of Canning House, the noble Lord, Lord Brennan, is unfortunately away, so we will miss him.

We welcome today the maiden speech of the noble Lord, Lord Liddle. He comes from a think tank background, and will add a great deal to our deliberations. I hope that I can recruit him to the Latin American cause, which needs a lot more members whenever we can get them. Whether we will agree entirely on the method of achieving this is another matter.

It is just over 55 years since I first went to live and work in Latin America, and I have been continuously involved, in a variety of capacities, ever since—especially after I returned to live here in 1962. During this time, there have been huge changes and I will highlight a few. Fortunately, with the number of speakers we have today, we should be able to cover most aspects in the time allocated.

Latin America is a vast geographical area, growing in importance, with the mainland stretching from the US border with Mexico to Cape Horn. It contains over 500 million people, spread across 20 republics. Brazil, the largest country—slightly bigger than the USA—has 200 million people alone. It plays a leading role, which is an added responsibility. Brazil, Mexico and Argentina are all G20 member states. The GDP of Brazil is greater than that of India. The combined GDP of Mexico and Argentina equals that of India. The combined GDP of Latin America is equal to China. Given that China and India have populations in excess of 1 billion, one can see that individual purchasing power—GDP per capita—is much greater in Latin America, making its countries significant markets to which we should pay attention.

In April last year, President Obama made a powerful speech at the Summit of the Americas in Trinidad. He engendered a great deal of enthusiasm and there was much optimism that the US would start to take its southern neighbours seriously after many years of neglect. The continent was expecting some rapprochement with Cuba, and President Chavez of Venezuela even shook President Obama’s hand warmly. Sadly, nothing happened subsequently.

The same malaise has been the norm in this country. Sadly, the Labour Government never took Latin America seriously. They closed embassies, downgraded others, and the region ceased to be a priority area while we slavishly followed the US into eastern wars. I like to think—indeed, hope—that the new coalition will turn over a new leaf and take a different line; in other words, they might like to turn the Foreign Office back into the policy-making department that it once was. That would be valuable, instead of having policy decided in No. 10 Downing Street.

I turn now to a few ideas by way of encouragement. In the debate four years ago, I suggested that UKTI should be closed and the promotion of trade overseas done by commercial officers in British embassies, who would be involved in what was happening on the ground and therefore able to offer practical advice to businessmen. Unfortunately, this proposal fell on stony ground. In parallel, DfID, which has a ring-fenced budget, could be transferred back under the Foreign Office. It would be much better able to identify technical assistance projects overseas from on the ground, and stop spending funds through international organisations, which is extremely wasteful. This is very important in these hard-pressed times. Indeed, one wonders whether—with such a huge national debt—charity should not begin at home. Under current rules, most Latin American countries are middle-income countries and not aid recipients. However, there is a case for aid in certain countries, where microfinance would be highly productive in starting new small businesses in an extremely entrepreneurial environment. I appreciate that the suggestion I have just made is highly controversial. It fell on stony ground four years ago. It is now even more worth while, hence my recycling of it today.

I turn now to Latin America itself. When I first went there to live, it was mainly run by military Governments, with central planning, multiple exchange rates, import restrictions and inflation. Gradually, nearly all the countries returned to democracy, with market economics, huge investments and rapid development. Sadly, poverty, which is prevalent in the region, has not yet been eradicated and is still a major challenge. However, perhaps the most significant development of recent years has been the development of what is known as ALBA—the Alianza Bolivariana para los Pueblos de Nuestra América, which translates as the Bolivarian Alliance for the Peoples of our America. This is the brainchild of President Chavez of Venezuela. It originally had two member states, namely Cuba and Venezuela, and was based on an exchange of Venezuelan oil for medical staff and teachers from Cuba. Subsequently, Bolivia joined, followed by Nicaragua and Ecuador. Some smaller Caribbean states also joined.

Essentially, the aim of ALBA was an alternative to the US-led free trade area of the Americas known as LAFTA. Oddly, the Venezuelan wealth which is dispensed and accounts for the country’s dominance of ALBA is almost entirely derived from oil exports to the USA. This form of authoritarian socialism—which is how I loosely describe it—involves the nationalisation of companies, the loss of independent media, manipulation of the constitution to provide continuous re-election of the President and the intimidation of opponents. Argentina is not a member of ALBA, but the Kirchner husband and wife team—who seem to alternate in power—follow the same precepts and policies as Chavez. Like it or not, ALBA is a reality. We need to understand it in this country, come to terms with it and work out how we can relate sensibly to it and do business there.

Fortunately, there are plenty of bright spots to compensate for the rather gloomy picture that I have painted. We have a strong relationship with Brazil, where President Lula will stand down in October after a most successful presidency, which included an important visit to Britain. As and when the UN is reorganised, surely Brazil should be one of the permanent members of the Security Council. I wonder when this will happen. Chile is a great success story, as is Peru. Colombia has just elected a new President in a huge turnout, with a massive majority in the second round. President Santos is no stranger to this country, where he lived for many years. I am sure our relations with Colombia will continue to prosper.

Mexico, the second most important Latin American country, is in a strong economic situation, but has major security problems due to infighting by the warring drug cartels. Central America is also extremely interesting as it is developing an integration process called Sistema de la Integración Centroamericana, or SICA for short, with a rotating presidency every six months. Currently, this is Panama, which will be succeeded by Belize on 1 July. In this country we have an all-party group which reflects this arrangement, which is very satisfactory.

I would like to go on, but wish to make one last general point. This year, 2010, is the bicentenary of the start of the independence movement in Latin America in 1810, in which Britain played a major role. Both Simón Bolívar in the north and San Martín in the south derived their philosophical ideas from the French revolution and their political support from Britain. With the exception of Portuguese-speaking Brazil, which did not become a republic until the late 1880s, all countries in Latin America are holding commemorative celebrations at various times, as are the Latin American embassies in London and the various bilateral Anglo societies.

The dream of Bolívar was of one great united Spanish-speaking region. It remains a dream and is, indeed, the aspiration of President Chavez of Venezuela. However, I contend that it will never be achieved through the imposition of authoritarian socialism. It may come eventually when all the Americas, north and south, unite in a common cause freely given. It also remains my dream, but I doubt that it will happen in my lifetime although it is a very worthwhile aspiration.

In my short speech I have tried to touch on a few aspects of this huge and fascinating subject—rather controversially, I fear, but that is the norm given my position in this House. I am happy to stand corrected by others who have different views. I will listen with very great interest to all that follows. I beg to move.

--- Later in debate ---

[Viscount Montgomery of Alamein]

As two noble Lords have withdrawn there are theoretically a few more minutes for me to sum up, but I do not propose to take many of them. Fortunately, the noble Lord, Lord Howell, has summarised everybody’s speeches succinctly, so I do not have to.

We have this afternoon had an amazing range of opinion and views. I cannot fail to mention the maiden speech of the noble Lord, Lord Liddle, with which I agreed almost entirely. He will be a valuable asset not only to this House but to the cause of Latin America. His policy review organisation will no doubt produce many interesting papers of value on the subject.

The themes that came though in this debate were, obviously, human rights and environmental concerns, which were mentioned by so many. The one thing that I thought was particularly striking was the idea of unity—the noble Lord, Lord Hannay of Chiswick, expressed this—in Europe and Latin America; in other words, the dream of Bolivar. There are obviously a lot of differences of opinion and different ideas about how to achieve unity in these two great continents that must work together. In coming back to that in other debates, as the noble Baroness, Lady Hooper, said, we may need to address many aspects of this immense problem.

I am extremely grateful to all those who have taken part. I have learnt an enormous amount from this debate. One never stops learning. Even though I have been at it for many years, every day I learn something new. Today has been no exception. I beg leave to withdraw the Motion.

Motion withdrawn.