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Colombia goes up; Argentina goes down; Venezuela stands still

By Thiago de Aragao.

Ingrid Betancourt's release was South America's greatest political event in July. Not only for the spectacular operation led by the Colombian army, but for all its symbolism. The battle fought between Colombia's government, led by President Álvaro Uribe, and the FARC came to a climax with Ingrid's release. Besides, as far as regional geopolitics is concerned, it came as a victory for the strategy Uribe has pursued since coming to office, against the veiled support given by Venezuelan president Hugo Chávez.

That said, it does not come as a surprise that Chávez is now more 'soft-core' in this period of the year. After successive domestic victories that have helped Uribe reach a 94% approval rate, Chávez would not be such a fool to openly oppose the Colombian. As Chávez is neither a hypocrite to support and join Uribe, he has simply abstained from any controversial statements on the matter.

Chávez knows very well that his continuity in government depends on a good win by his party in November's municipal elections. These elections will be crucial for Chávez's strategy, as they will determine if he will turn 'hard-core' again. When Chávez lost the vote on constitution reform last November, he had been in frequent attrition not only with Uribe, but also with several political groups and figures, such as Spanish King Juan Carlos. That negative moment may have played a role in his not so surprising defeat in the referendum.

Since then, Chávez has mapped the areas where he was defeated and decided to invest in massive gains in November's municipal elections. With a good win in the relevant regions, Chávez may be able to call another referendum to reform the constitution and recover the 4 percentage points that made him lose last year. Therefore, fighting Uribe at this point is not a good idea.

Chávez's 'soft-core' behaviour is not shared by his Ecuadorean counterpart Rafael Correa. The latter decided not to resume diplomatic relations with Colombia. However, unlike Chávez, Correa has high approval rates and achieved an important political victory by having the new Constitution approved by part of the Constitutive Assembly. If his confrontational attitude towards Uribe is generating popular results, Correa will continue using that strategy to make sure the people will endorse the new Constitution. Thus, his grip on power will become more solid, as will a centralization of government activities around his cabinet.

Another important event in July was Cristina Kirchner's defeat in the Argentine Senate. The 'retention' taxes, which sparked a real war between government and farmers, were overruled by the Senate. However, the final blow in Cristina's defeat came from her vice president – and also Senate president – Julio Cobos. After that result, Cristina is now expected to slightly shift her economic strategy. She will be forced to compensate with investment the new wave of exports to be experimented by the country, which will probably cause inflation to rise given the reduced supply of goods for the domestic market. As the inflation figures released by INDEC are seen as under-reported by several economic analysts in the country, Cristina is left with the options of either slowly adjusting the under-reported rate until it matches the real figure, or to concede that the there was an error in arriving at the number – which is highly unlikely.

The deadlock arrived at in Bolivia's recall vote is a new chapter in the endless soap opera which the country's institutional crisis has become. The National Electoral Court says that the consultation complies with the law, but the Constitutional Tribunal wants a judgement on whether it is legal, and a quorum is necessary. There is only one judge available out of five, since four have resigned. There is an impasse when it comes to choosing these four new ministers. The opposition fears that politically motivated nominations may end up bringing judges who support the government, thus harming the progress of the process to grant autonomy to the provinces. Should Evo Morales use this strategy to obtain a legal victory, the country's political and institutional atmosphere will certainly aggravate.

According to direct information provided by the Movimiento Autonómico de la Media Luna, Morales is playing with fire because he feels he is backed by a military cooperation agreement with Venezuela. According to a local source, Morales knows that there will be no comprehensive offensive movements should the Judiciary back the government. However, the autonomy process is clearly gaining more backing and support among the population.

Concerned with domestic elections, Chávez is paying Bolivia much less attention than he used to. Morales, sandwiched between his party and the opposition, has temporarily lost a heavyweight ally to overturn the situation. One wonders how the Judiciary situation will unfold and to what extent rebel provinces will abide by any decisions made. If they don't, chaos is clearly ahead.

Brazil's foreign policy has not had any involvement in that issue. Unless dramatic diplomatic movements are being made on the background, Brazil's foreign policy is not paying due attention to political tensions in Bolivia. In case of a civil conflict in Bolivia, the autonomy movement estimates that approximately 300,000 people would seek refuge in Brazil. In addition, natural gas supply to Brazil would be certainly harmed.

Thiago de Aragão is an analyst at Arko Advice and a researcher at London's Foreign Policy Centre<b/>