Published On: Mon, May 4th, 2015

Fault lines

Jacob Gelt DekkerNew fault lines are tearing through Latin American and Caribbean land- and seascapes, announcing earth shattering new economic and social realities.

The deepest crack in the traditional and conservative crust runs north-south, separating Pacific from Atlantic LATAM-nations.
Colombia, for 50 years pinned down by civil wars, seems to be leading the Chili-Peru-Ecuador pack with an upward push; Venezuela, with a reactionary 19th- century central command economy, continues to lead a sink down with the rest. Even Brazil, only a few years ago the brightest rising star on the sky, has fallen by the wayside. Most of the Caribbean appears to be in the wake of Venezuela’s rapid demise. Cuba, once part of the Caribbean plate, seems to be breaking away and drifting toward the North American platform.

There is little one can do to change the course of unstoppable forces, especially with Atlantic-LATAM systems, frozen in post-colonial reactionary socialism and nationalism, and suffering from a century of intellectual isolationism. Corruption and crime are now so deeply entrenched in every level of these societies, that weeding out this pest is equal to suicide. Although the traditional social fabric may be eroding, the suffocating grip of the closed elite on society and economy may relax a little but is far from gone.

In global economies internationalism of manufacturing and trade prevails. Panama is preparing for the opening of its new mega-containership canal, in 2016, enabling Asia to reach East Coast-USA-harbors, effectively cutting out transshipment facilities in the Caribbean. The fast growing Indian, cheap labor, production markets will inevitably engage in a fierce competition battle for the same US-markets, via the Suez Canal route, also cutting out the Caribbean.

The long-term continuation by China, South East Asia and India of extremely low profit margin manufacturing remains another issue of wide speculation and debate.

Reorganizing energy markets create new realities faster than any other force. Almost over night, the USA has become world’s largest producer of oil and natural gas, discouraging massive transport from elsewhere. The once invincible largest reserves in the world of the Orinoco region, now turned into heavy tar surplus, are being sold off at deep discounts as a consequence.

Wishful thinking by Caribbean micro island nations point out the economic need for more sophistication and production of high value oil products, therewith promoting the rebirth of their aging refineries.

Alternative and renewable energy technologies are lurking in the fringes and will soon seriously challenge LATAM-energy markets.
So the fault lines are set, waiting for the inevitable earthquake and being ready for the shakeout is a most essential matter of survival.

By Jacob Gelt Dekker, opinion columnist for Curaçao Chronicle.

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