Monday, September 2, 2013

Embassy Threatens US Development Aid Again, This Time over Salvadoran Judicial Conflict
 For the last two weeks, US Ambassador Mari Carmen Aponte has yet again threatened to deny El Salvador $300 million in Millennium Challenge Corporation (MCC) development funds, this time over a conflict between two Chambers of the nation’s Supreme Court. [[[[Over the last year, MCC funding has proven an effective instrument of US intervention, with Aponte publicly ransoming its approval on numerous occasions for the passage of the US-backed privatization legislation, the Public-Private Partnership (P3) Law. ]]]]]“The generation of a stable investment climate that brings sustainable economic development for the country is one of our priorities… The rule of law and the strength of institutions are among the criteria that the MCC observes to make the important decisions in making a new pact,” Aponte warned Salvadoran media in a press conference on Wednesday, August 21. The dispute began when the controversial “Fantastic Four” magistrates of the Supreme Court’s Constitutional Chamber ordered the Administrative Disputes Chamber to reject a suit that challenged the legality of the four magistrates’ own appointments to the bench. The Administrative Disputes Chamber accepted the case and denounced the “Fantastic Four” for overstepping their legal jurisdiction. As in the past, the US has defended the polemic actions of the Constitutional Chamber. “We have been clear that the Constitutional Chamber’s decisions must be respected for the good of the country’s institutionality,” said Aponte. Indeed, in July 2012, two US Senators threatened MCC funds to El Salvador over a conflict between the Constitutional Chamber and the National Legislative Assembly instigated by the Salvadoran right-wing as part of an ongoing strategy to destabilize the current government. President Funes, however, denied the Ambassador’s claims that the $300 million MCC grant was in danger, saying that as of last week, negotiations between the two countries were progressing smoothly towards a final decision in September. Magistrate Evelyn Nuñez of the Court’s Administrative Disputes Chamber also dismissed Aponte’s remarks, saying the conflict was overblown: “She represents her country’s interests, and if she sees it as a problem, well that would be a shame, but really it’s not an issue.” Nevertheless, the Ambassador’s threats have been amplified in headlines across the nation’s right-wing media. With the 2014 presidential elections on the horizon, the right-wing Nationalist Republican Alliance (ARENA) party and the Catholic Church took the opportunity to defend the “Fantastic Four” and accuse the governing leftist Farabundo Martí National Liberation Front (FMLN) party of both instigating the conflict and being unfit to manage it. ARENA presidential candidate Norman Quijano deemed the situation “serious,” saying that, “this has been the norm under the FMLN government, this political instability and legal instability that has harmed us so much.”
El Salvador Faces New World Bank Lawsuit over Public Electric Company, Ex-president Implicated in Corrupt Deal
On August 13, Italian energy company Enel Green Power filed a claim against the government of El Salvador in the International Center for the Settlement of Investment Disputes (ICSID) for the right to buy out the public geothermal energy company, LaGeo. [[[[[The move is the latest in the ongoing legal battle over LaGeo, a transnational public-private partnership (P3) gone wrong that has invigorated the debate around the recently-approved P3 Law, which currently faces controversial proposed reforms]]]]]]] The ICSID, the same World Bank tribunal that Pacific Rim and Commerce Group, based respectively in British Columbia and Wisconsin, used to sue El Salvador, unsuccessfully, for denying their gold mining permits, has not yet announced if it will take up the case.Meanwhile, last week the legislative commission convened to investigate the LaGeo P3 contract between the state and Enel released its findings, recommending that former right-wing Nationalist Republican Alliance (ARENA) President Francisco Flores and several other key actors in the deal be investigated by the Salvadoran Attorney General for corruption and acting against the interest of the state. These recommendations now face scrutiny and debate in the Legislative Assembly. If approved by a simple majority of 43 votes, Attorney General Luis Martínez will take up the case. “For the first time in the country’s history we would be prosecuting a former President, and that implies that we are advancing in this democratic process that demands transparency,” said the commission’s president, FMLN legislator Jaime Valdez. Valdez was cautiously optimistic that, despite Martínez’s history working in the previous ARENA administration of Tony Saca, Martínez would duly proceed with the investigation should the recommendations be approved, noting that “Francisco Flores is already being questioned at the request of President Mauricio Funes, who called for an investigation in this same case.”Indeed, calling the LaGeo P3 a “disguised privatization,” Funes has echoed the social movement’s outrage and vowed to do all in his power “not to turn over the patrimony of Salvadorans to foreign hands.” The President’s vehement and outspoken defense of LaGeo draws a strange and stark contrast to his equally outspoken advocacy for the P3 Law—legislation that Jaime Rivera, a LaGeo employee and Organizing Secretary for the Electrical Workers Union (STSEL), warned in January would see that “we as a country would lose the opportunity to own companies that generate resources for social investment.”

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