A specific city in Oregon has seen a huge amount of growth in the Hispanic community.
It’s almost 7 o’clock at night and Rosa Ramirez has had a fruitful day. Today her sales were good, but Ramirez says it isn’t always this way.
Rosa Ramirez moved to Oregon from El Salvador.
She sells pupusas that she makes at a market in Hillsboro, Oregon. It’s a traditional dish from her home country of El Salvador.
Ramirez says she was pregnant when she almost died at a shooting during the civil war in her country.
Her unborn child did not survive. Heartbroken, she left El Salvador in 1992. Oregon has been her home for the last 30 years.
“When I came here there was almost no one who spoke Spanish. Only English, and it was difficult for me because I was a nanny, and I was working for people who only spoke English and then I started fighting with the language,” said Ramirez.
She is one of the almost 600,000 Latinos living in the state.
According to the 2020 Census, Oregon’s Latino population grew by more than 30% in the last ten years.
Latinos are now the largest minority group in the state and their numbers have grown faster than the national rate in each of the last three decades.
Maria Caballero Rubio is the executive director of Centro Cultural in Washington County.
“That just shows that we are making a mark and we are growing. And I think people are acknowledging that we are a growing population,” said Rubio.
She has seen steady growth since her farmworker family settled in Washington County in 1969. They migrated from Durango, Mexico.
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“Maybe eight years ago, the only flags we had up here were the Mexican flag, because a lot of people were from, [or] have their ethnicity from Mexico. And then we had the American flag. But then the more that we started having visitors, they would say to me, you know, ‘where’s my flag?’ so, we decided that we would bring in the flag for people who’ve come to visit,” said Rubio.
Caballero says that the thriving Latino population is starting to rise out of the fields and into professional jobs.
“We had jobs in farm work or we had farms, jobs in in landscaping and those kinds of things. But more and more, as our communities have stayed here and the next generations have grown up and they become educated, they are coming back as professionals,” she continued.
More than half of Oregon’s Latino population is in three counties: Multnomah, Washington and Marion. There the Latino communities grew by at least 25% in the last decades.
“We are becoming more visible now, I have to say. Ten years ago, you couldn’t find an elected official here in Washington County or the Portland metro area that was Latino,” said Rubio.
In fact, Carmen Rubio became Portland’s first Latino city commissioner in 2020. She is Maria’s daughter.
Maria says the younger population may cause a shift in politics as more become eligible to vote when they turn 18.
NEWSY’S AXEL TURCIOS: There’s more representation in the Latino community, in the state legislature, city councils, more Latinos getting into office, representing these growing communities across the state. Will this last?
MARIA CABALLERO RUBIO: I think so. I think it will last. We’re going to move forward and we’re going to continue making change, you know, social and systems changes that need to happen because of the historic disenfranchisement of people of color.
The state once legally banned Black people.
“But, you know, department heads and managers and, you know, police chiefs and all of those. I think that they have not — they have not taken steps to be more inclusive in terms of recruiting and making it more more available to people of color to apply it. That’s an area that we still lack,” said Rubio.
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The increase in the Latino population here in Oregon has also been propelled by new waves of migrants. One of those waves is Venezuelan migration, fleeing poverty and the government in their country. According to the American Community Survey, there are more than 1,400 Venezuelans living in the state of Oregon.
Giselle Rincon is the president and co-founder of Venezuela’s Voice in Oregon.
“Everybody’s struggling to find food, medical supplies or jobs, especially safety,” said Rincon. She says the new Venezuelan migrants are facing new challenges.
“Mostly access to education, how to find a job, how to navigate the system, where to apply. Most of the Venezuelans are professionals and they want to help prosper the economy of Oregon.”
“I think our new generations are becoming more involved. They are, you know, getting an education,” said Jaime Miranda, the owner of M&M Marketplace.
Back at the Hillsboro market, Miranda says he was one of only a few Mexican immigrants in his neighborhood when he moved from Chihuahua, Mexico in 1985. He was 10 years old.
He went to college and has owned this Latino market for 22 years. He started it with only 12 vendors and now the establishment has 66.
TURCIOS: How do you think the new generations of Latinos are shifting culture here in Oregon?
JAIME MIRANDA: You know, from migrant workers to people who are starting their businesses, own their homes, they are getting a career, an education. So, we are definitely shifting to that second generation where they are integrated, and they understand how to navigate the system and be part of the community as a whole.
“Now you see more Hispanics than before. Before, you didn’t see any Hispanics. Hispanics were very rare to find here in Oregon,” said Ramirez.
As for Rosa, she says she carries El Salvador in her heart, but she’s beyond grateful to the United States, a nation that gave her a new life and optimism about the next generation.
Legions of Naasón Joaquín García’s followers remain loyal to him, viewing his imprisonment as a challenge that will strengthen their church.
Their spiritual leader is behind bars in California after pleading guilty to sexually abusing minors. Yet legions of followers of Naasón Joaquín García in his home base in Mexico remain fervently loyal to him, viewing his imprisonment as a challenge that will strengthen their church, La Luz del Mundo (The Light of the World), rather than weaken it.
His continued hold on his flock was evident recently at the Christian church’s main temple in Guadalajara, as thousands gathered to pray for their absent leader during their Holy Supper, the most sacred festivity for La Luz del Mundo. To gasps of surprise, Joaquín García addressed the congregation by telephone from his Los Angeles prison, where he is serving a 16-year sentence.
“I do not see the bars that separate me from you,” he told his followers. “I see your beautiful faces … because you are the children of God.”
Even outside the temple, the sound of his voice stirred emotions among dozens of devotees guarding entries to the sanctuary. Nearly all closed their eyes. Many lifted their fists. Some knelt and wept.
Near the end of the call, Joaquín García asked his followers to raise their hands and their voices to God and repeat after him: “I promise you, Lord, that whatever the suffering, I will never abandon you.”
It seems clear that many members of the church, founded in Mexico in 1926 and now active in many countries, aren’t ready to abandon Joaquín García as their “apostle” — the term used for the church’s leader. Many believe he was sent by God to preach to them and are convinced he is innocent, despite his guilty plea.
“The apostle always shows determination to move forward,” said Phares Ruiz, who traveled from El Salvador to attend the Holy Supper. “He’s firm in his convictions, and the church is firm as well in its purpose of moving forward.”
Ruiz told The Associated Press that his family has belonged to La Luz del Mundo for three generations.
Joaquín García, 53, was arrested in 2019 in California. He initially faced more than 20 charges, but most were dismissed after a plea deal with prosecutors. The church contended that prosecutors withheld or doctored evidence, and said Joaquín García pleaded guilty because he didn’t think he could get a fair trial.
“The Apostle of Jesus Christ has had no choice but to accept with much pain that the agreement presented is the best way forward to protect the church and his family,” the church said.
The home base of the church is the Guadalajara neighborhood of Hermosa Provincia, Spanish for “beautiful province.” Jericho, Bethlehem and Nazareth are among the names of roads converging on the white temple that locals call “the cake,” for its white tiers that diminish in size as they rise upward.
Congregation members in the neighborhood call each other “brother” and “sister” and take pride in helping one another. The church’s media relations office claims there is no crime in the area.
The neighborhood has cafeterias, clinics, a recreation center and a store that sells Bibles and religious-themed games for children. From the walls hang photographs of Joaquín García, smiling and wearing a tuxedo. Spanning the main street is a sculpture spelling “innocent” in Spanish.
Sara Pozos, 49, is among many in the neighborhood who believe their leader’s imprisonment has strengthened the church.
“I think it changed for the better in the sense that now we feel more united, and we feel more empowered,” she said.
“It has been a very difficult issue, of course, for him and for us,” she added. “We all suffer something in life, but one learns to know those moments where you see that God is doing something to help you, to get ahead, not to let you fall.”
Another neighborhood resident, Sailem Castillo, also said she was upbeat despite Joaquín García’s imprisonment.
“For us everything is very nice, everything continues to work,” she said. “Ministers, pastors and deacons have their same duties. They bless the bread, the wine, and do other things as if he were here, although physically he is not.”
The jailed leader is the grandson of La Luz del Mundo’s founder: Eusebio Joaquín González, a member of the military who began preaching in 1926. He’s known to church members as Aarón — a result, he said, of God asking him to change his name.
Aarón’s wife was the church’s first member. Today it claims a membership of more than 5 million in some 50 nations.
La Luz del Mundo is sometimes described as evangelical, but its members do not embrace this term. The church’s doctrine is learned from the cradle. Parents give biblical names to their children and take them to the temple at 40 days old to promise they will guide them to follow their path.
Most teachings translate into something quotidian. During services, the women sit to the right and men to the left. In some cities, people tithe more than 10% of their monthly income to the church. Biblical verses are cited to explain behavior.
Castillo, a recently married woman of 25, told AP the church advises members how “to lead a decent life,” in which women may not drink alcohol or go out on frequent dates. Like other women in Hermosa Provincia, she wears dresses and skirts that are not form-fitting, eschews makeup and earrings and wears her hair long.
The religion is “very demanding,” said Arlene M. Sánchez-Walsh, a professor of religious studies at Azusa Pacific University, a Christian institution near Los Angeles.
“It is not sufficient to say ‘I have converted’ or “I have baptized'” she said. “You have to follow certain steps to prove your loyalty.”
For some young people, these steps include memorizing songs honoring the apostle, reading the Bible before bed and not marrying someone from outside the church.
“All this goes to show that although you are part of this world, you have accepted a very particular way of life because you are Christian,” Sánchez-Walsh said.
Those born in the community are baptized at 14 because, according to the church, that lets them decide whether to reaffirm or leave the faith. Nevertheless, there are former members who say their ceremony was not optional.
Ahead of the baptism, in a ritual known as “the revivals,” children undergo days of prayer and fasting inside a temple. The revival consists of repeating “Glory to Christ” nonstop until the youths are heard speaking in tongues to testify that the Holy Spirit has entered them.
For Raquel Haifa, 43, fulfilling the revivals was a traumatizing experience that she considers abusive, because minors are not able to decline to take part.
“I did cry, because I was saying, ‘God, deliver me from this, make this time pass quickly,'” Haifa said from Texas.
Currently, journalists are not allowed to attend services or take photographs inside the church’s temples. Since Joaquín García’s arrest, La Luz del Mundo’s media relations team says it cannot make official statements on his case because litigation is ongoing.
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On Sept. 8 a lawsuit was filed in California against Joaquín García and four church members alleged to be complicit in the sex abuse. The suit was filed by five women who — under the pseudonym Jane Doe — were identified as victims in the original criminal charges against him.
It accuses Joaquín García of conditioning victims, under the guise of religion, to serve him above all else, ultimately resulting in the sexual abuse over the course of several years.
The lawsuit includes detailed accounts from the five plaintiffs alleging that they were pressured by Joaquín García and his associates into performing for pornographic photo shoots, and were forced to engage in sex acts with him.
“The church weaponized the faith of their most vulnerable members,” said Jonati Joey Yedidsion, one of the lawyers handling the lawsuit. “Instead of protecting those innocent women, Naasón and the church fostered and then brutally preyed on their blind trust and allegiance in the ‘Apostle'”.
The case has been difficult for some former members who have distanced themselves from the church.
Speaking on a podcast called “I Left a Sect,” Lo-ami Salazar said Hermosa Provincia used to be her “happy place.”
“Knowing that these abuses took place there, in my happy place, in my safe place, is horrible,” she said.
The CBP said U.S. crews rescued 37 others from the river and detained 16 more, while Mexican officials took 39 migrants into custody.
Officials on both sides of the U.S.-Mexico border searched for more victims Saturday after at least nine migrants died while trying to cross the rain-swollen Rio Grande river, a dangerous border-crossing attempt in an area where the water level had risen by more than 2 feet in a single day.
U.S. Customs and Border Protection and Mexican officials discovered the victims near Eagle Pass, Texas, on Thursday, following days of heavy rains. U.S. officials recovered six bodies, while Mexican teams recovered three, according to a CBP statement. It is one of the deadliest drownings on the U.S.-Mexico border in recent history.
The river, which was a little more than 3 feet deep at the start of the week, reached more than 5 feet on Thursday, and the water was flowing five times faster than usual, according to the National Weather Service.
“There was much more water in the river after that rain, and there was more rain upstream, which adds to the flow,” said NWS meteorologist Bob Fogarty.
The CBP said U.S. crews rescued 37 others from the river and detained 16 more, while Mexican officials took 39 migrants into custody.
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CBP did not say what country or countries the migrants were from and did not provide any additional information on rescue and search operations. Local agencies in Texas that were involved have not responded to requests for information.
The Border Patrol’s Del Rio sector, which includes Eagle Pass, is fast becoming the busiest corridor for illegal crossings. Agents stopped migrants nearly 50,000 times in the sector in July, with Rio Grande Valley a distant second at about 35,000. Eagle Pass is about 140 miles southwest of San Antonio.
The area draws migrants from dozens of countries, many of them families with young children. About six of 10 stops in the Del Rio sector in July were migrants from Venezuela, Cuba or Nicaragua.
The sector, which extends 245 miles along the Río Grande, has been especially dangerous because river currents can be deceptively fast and change quickly. Crossing the river can be challenging even for strong swimmers.
In a news release last month, CBP said it had discovered bodies of more than 200 dead migrants in the sector from October through July.
This year is on track to break last year’s record for the most deaths on the U.S.-Mexico border since 2014, when the U.N. International Organization for Migration began keeping track. The organization has tallied more than 4,000 deaths on the border since 2014, based on news reports and other sources, including 728 last year and 412 during the first seven months of this year, often from dehydration or drowning. June was the fourth-deadliest month on record, with 138 fatalities.
The Border Patrol has not released official tallies since 2020.
In June, 53 migrants were found dead or dying in a tractor-trailer on a back road in San Antonio in the deadliest documented tragedy to claim the lives of migrants smuggled across the border from Mexico.
Some of the busiest crossings on the border — including Eagle Pass and Yuma, Arizona — were relatively quiet two years ago and now largely draw migrants from outside Mexico and Central America’s ‘Northern Triangle’ countries of Guatemala, Honduras and El Salvador. Mexico has agreed to take migrants from the ‘Northern Triangle’ countries, as well as its own nationals, if they are expelled from the United States under Title 42, the pandemic rule in effect since March 2020 that denies rights to seek asylum on grounds of preventing the spread of COVID-19.
People from other countries are likely to be released into the United States on humanitarian parole or with notices to appear in immigration court because the U.S. has difficulty flying them home due to costs, strained diplomatic relations or other considerations. In the Border Patrol’s Del Rio sector, which includes Eagle Pass, only one of every four stops in July were processed under the pandemic rule, compared to about half across the rest of the border, according to government figures.
Venezuelans were by far the most common nationality encountered by Border Patrol agents in the Del Rio sector in July, accounting for 14,120 of 49,563 stops, or nearly three in 10. They were followed by Cubans, who were stopped 10,275 times, and then by Mexicans, Hondurans, Nicaraguans and Colombians, in that order.
As more people crossed into South Texas in the 2010s, Brooks County became a death trap for many migrants who tried walking around a Border Patrol highway checkpoint in the town of Falfurrias, about 70 miles north of the border. Smugglers dropped them off before the checkpoint and made arrangements to pick them up on the other side, but some perished on the way from dehydration.
The Baboquivari Mountains in Arizona and ranches in Texas’ Brooks County still draw Border Patrol agents and grief-stricken families hoping to rescue migrants or, if not, find corpses, but the deceptively strong currents around the Texas towns of Eagle Pass and Del Rio have become increasingly dangerous as the area has become one of the most popular spots to enter the United States illegally.
Not all victims are migrants. In April this year, the body of a Texas guardsman was recovered from the Rio Grande. He had jumped in to try to help a migrant who was struggling in the water.
A movement called “The Green Wave” has pushed the success of the reproductive rights movement in three of Latin America’s most populous countries.
When the Supreme Court overturned Roe v. Wade, the United States became one of only four countries that have rolled back abortion rights since the mid-90s, joining Poland and two Latin American countries: El Salvador and Nicaragua.
But elsewhere in Latin America, there’s been momentum building in the opposite direction.
A widespread, grassroots movement known as “The Green Wave” has been gaining ground for reproductive rights in the region, winning major legal victories in the last couple of years. That’s in Latin America’s three most populous countries.
In December 2020, lawmakers in Argentina passed a law allowing abortion within the first 14 weeks of pregnancy. Less than a year later, in September 2021, Mexico’s Supreme Court decriminalized abortion through a unanimous decision. Then in February of this year, Colombia’s highest court legalized abortion during the first 24 weeks of pregnancy. Coming up in September, voters in Chile will decide whether to ratify a new constitution that would protect the right to abortion.
These changes are a huge deal for countries that are predominantly Catholic and historically very conservative with abortion rights.
Argentina is the birthplace of Pope Francis, who made last-minute appeals against both an unsuccessful bill in 2018 and the bill that was passed in 2020. Meanwhile Chile, another historically very Catholic country, had a total abortion ban until as late as 2017.
So, what exactly is this movement, and how did it achieve such huge victories against the odds?
The Green Wave began in Argentina. Organizers took inspiration from the “Mothers of the Plaza de Mayo:” a group of women who protested against the ruling military junta in the late 70s. The women, protesting the thousands of civilian killings ordered by the mIlitary, famously wore white scarves on their heads.
Fast forward a couple of decades, two women decided to pay homage to the protesters without reusing the color white. The original organizers brainstormed together and settled on the color green to symbolize life and growth.
The green bandanas made their debut in 2018 to support a bill to decriminalize abortion. Though the law didn’t pass then, the image of the waves of green stuck – and the movement began in earnest.
It’s worth noting: The region is still one of the most restrictive in the world when it comes to reproductive health laws. As of 2021, abortion is entirely banned in Nicaragua, Honduras, El Salvador, Haiti, Jamaica, the Dominican Republic and Suriname.
But, the recent wave of victories seems to be changing public opinion. For example, one poll in Mexico showed support for abortion access jumped dramatically from 29 to 48%. That poll was taken just as Argentina was passings its laws, and Mexico would follow nine months later.
This shift correlates with another important shift in the region: Some surveys indicate a decline in Catholicism among most Latin American countries. Argentina had one of the biggest drops in this regional survey, from 76% to 49% reporting they identified as Catholic.
That begs the question: What effect from this might be seen in the U.S.? The green symbolism has already made its way stateside, and some elected officials like Rep. Alexandria Ocasio-Cortez wore a green bandana on the steps of the Supreme Court after the ruling.
Still, the question still remains of how the U.S. might translate this symbolism into real, legislative action seen in Colombia, Mexico and Argentina.
CBP estimates show one in four people agents encountered in May were caught crossing the border more than once.
2022 has been a record year along the U.S.-Mexico border. U.S. Customs Border and Protection data shows monthly encounters have nearly doubled month to month from last year.
In 2021, there were a total of 1.7 million migrants. CBP has already seen more than 1.5 million encounters this fiscal year.
For over two years, border agents have sent millions of people back from the border under Title 42.
The health policy allows officials to turn away asylum seekers under the justification that there is “serious danger of the introduction of disease into the United States.”
Officials say this has led to repeat crossers.
CBP estimates show one in four people agents encountered in May were caught crossing the border more than once.
Title 42 is tied up in the courts as the Biden administration seeks to end the order.
A second Trump administration immigration policy may soon come to an end.
The Supreme Court in late June sided with the Biden White House in its effort to end the “Remain in Mexico” policy.
The rule required migrants from a third country to wait in Mexico while their asylum application moves through the courts.
Politicians, like Republican governor Greg Abbott of Texas, point the blame of the ongoing surge at the Biden administration.
Most migrants illegally crossing the border have landed in Texas. Agents say the influx has left them overburdened.
The Biden administration says it has maintained its message that the border is not open.
Vice president Kamala Harris, who is tapped to lead the white house’s response to border challenges, says more needs to be done to address the root causes as to why so many migrants are arriving at the border.
Pew Research Center findings show most migrants are coming from countries other than Mexico, predominantly from the northern triangle countries of El Salvador, Guatemala, and Honduras.
According to the Council on Foreign Relations, high rates of domestic violence, poverty and gang activity have contributed to more families fleeing north.
The passage is risky. More than 50 migrants died inside an overheated semi truck in San Antonio.
And the Missing Migrants Project recorded more than 1,200 migrants who went missing or died along the U.S.-Mexico border in 2021.
The White House says it is focusing efforts on its new anti-smuggling campaign.
The president says officials have made over 2,400 arrests in the three months since its creation.
In Washington, Democrats and Republicans agree action is needed. But there is no agreement on what needs to change.
Democrats are split on Title 42, with some wanting the policy to stay in place until there is a full plan to deal with increased activity at the border. Republicans want the policy intact, and construction on president Trump’s border wall to resume to stem the flow of people heading north.
But as both sides look for answers, the surge in migration shows no signs of ending soon.
Homero Zamorano Jr. and Christian Martinez both face up to life in prison for the deaths while attempting to illegally smuggle migrants.
Two men were indicted Wednesday in the case of a hot, airless tractor-trailer rig found last month with 53 dead or dying migrants in San Antonio, officials said.
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A federal grand jury in San Antonio indicted Homero Zamorano Jr., 46, and Christian Martinez, 28, both of Pasadena, Texas, on counts of transporting and conspiring to transport migrants illegally resulting in death; and transporting and conspiring to transport migrants illegally resulting in serious injury.
Both remain in federal custody without bond pending trial. Martinez’s attorney, David Shearer of San Antonio, declined to comment on the indictments. A message to Zamorano’s attorney was not immediately returned.
Conviction on the death counts could result in life sentences, but the Attorney General’s Office could authorize prosecutors to seek death penalties. The serious bodily injury counts carry sentences of up to 20 years in prison.
It was the deadliest tragedy to claim the lives of migrants smuggled across the border from Mexico. The truck had been packed with 67 people, and the dead included 27 from Mexico, 14 from Honduras, seven from Guatemala and two from El Salvador, said Francisco Garduño, chief of Mexico’s National Immigration Institute.
The incident happened on a remote San Antonio back road on June 27. Arriving police officers detained Zamorano after spotting him hiding in some nearby brush, according to a statement from the U.S. Attorney’s Office. A search of Zamorano’s cellphone revealed calls with Martinez concerning the smuggling run.
Surveillance video of the 18-wheeler passing through a Border Patrol checkpoint showed the driver matched Zamorano’s description, according to the indictment. One survivor of the journey, a 20-year-old from Guatemala, told The Associated Press that smugglers had covered the trailer’s floor with what she believes was powdered chicken bouillon, apparently to throw off any dogs at the checkpoint.
The tragedy occurred at a time when huge numbers of migrants have been coming to the U.S., many of them taking perilous risks to cross swift rivers and canals and scorching desert landscapes. Migrants were stopped nearly 240,000 times in May, up by one-third from a year ago.
Of the 73 people in the truck, those who died included people from the Mexican states of Guanajuato, Veracruz, Oaxaca, Mexico, Zacatecas, Queretaro, Morelos and Mexico City. Migrants from Honduras and Guatemala also were among those who died in the deadliest known smuggling attempt in the United States.
In 2017, 10 people died after being trapped inside a truck parked at a San Antonio Walmart. In 2003, the bodies of 19 migrants were found in a sweltering truck southeast of the city.
LONDON, July 15 (Reuters) – Traditional debt crisis signs of crashing currencies, 1,000 basis point bond spreads and burned FX reserves point to a record number of developing nations now in trouble.
Lebanon, Sri Lanka, Russia, Suriname and Zambia are already in default, Belarus is on the brink and at least another dozen are in the danger zone as rising borrowing costs, inflation and debt all stoke fears of economic collapse.
Totting up the cost is eyewatering. Using 1,000 basis point bond spreads as a pain threshold, analysts calculate $400 billion of debt is in play. Argentina has by far the most at over $150 billion, while the next in line are Ecuador and Egypt with $40 billion-$45 billion.
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Crisis veterans hope many can still dodge default, especially if global markets calm and the IMF rows in with support, but these are the countries at risk.
The sovereign default world record holder looks likely to add to its tally. The peso now trades at a near 50% discount in the black market, reserves are critically low and bonds trade at just 20 cents in the dollar – less than half of what they were after the country’s 2020 debt restructuring.
The government doesn’t have any substantial debt to service until 2024, but it ramps up after that and concerns have crept in that powerful vice president Cristina Fernandez de Kirchner may push to renege on the International Monetary Fund. read more
Russia’s invasion means Ukraine will almost certainly have to restructure its $20 billion plus of debt, heavyweight investors such as Morgan Stanley and Amundi warn.
The crunch comes in September when $1.2 billion of bond payments are due. Aid money and reserves mean Kyiv could potentially pay. But with state-run Naftogaz this week asking for a two-year debt freeze, investors suspect the government will follow suit. read more
Africa has a cluster of countries going to the IMF but Tunisia looks one of the most at risk. read more
A near 10% budget deficit, one of the highest public sector wage bills in the world and there are concerns that securing, or a least sticking to, an IMF programme may be tough due to President Kais Saied’s push to strengthen his grip on power and the country’s powerful, incalcitrant labour union.
Tunisian bond spreads – the premium investors demand to buy the debt rather than U.S. bonds – have risen to over 2,800 basis points and along with Ukraine and El Salvador, Tunisia is on Morgan Stanley’s top three list of likely defaulters. “A deal with the International Monetary Fund becomes imperative,” Tunisia’s central bank chief Marouan Abassi has said. read more
Furious borrowing has seen Ghana’s debt-to-GDP ratio soar to almost 85%. Its currency, the cedi, has lost nearly a quarter of its value this year and it was already spending over half of tax revenues on debt interest payments. Inflation is also getting close to 30%.
Egypt has a near 95% debt-to-GDP ratio and has seen one of the biggest exoduses of international cash this year – some $11 billion according to JPMorgan.
Fund firm FIM Partners estimates Egypt has $100 billion of hard currency debt to pay over the next five years, including a meaty $3.3 billion bond in 2024.
Cairo devalued the pound 15% and asked the IMF for help in March but bond spreads are now over 1,200 basis points and credit default swaps (CDS) – an investor tool to hedge risk – price in a 55% chance it fails on a payment. read more
Francesc Balcells, CIO of EM debt at FIM Partners, estimates though that roughly half the $100 billion Egypt needs to pay by 2027 is to the IMF or bilateral, mainly in the Gulf. “Under normal conditions, Egypt should be able to pay,” Balcells said.
Kenya spends roughly 30% of revenues on interest payments. Its bonds have lost almost half their value and it currently has no access to capital markets – a problem with a $2 billion dollar bond coming due in 2024.
On Kenya, Egypt, Tunisia and Ghana, Moody’s David Rogovic said: “These countries are the most vulnerable just because of the amount of debt coming due relative to reserves, and the fiscal challenges in terms of stabilising debt burdens.”
Addis Ababa plans to be one of the first countries to get debt relief under the G20 Common Framework programme. Progress has been held up by the country’s ongoing civil war though in the meantime it continues to service its sole $1 billion international bond. read more
Making bitcoin legal tender all but closed the door to IMF hopes. Trust has fallen to the point where an $800 million bond maturing in six months trades at a 30% discount and longer-term ones at a 70% discount.
Pakistan struck a crucial IMF deal this week. read more The breakthrough could not be more timely, with high energy import prices pushing the country to the brink of a balance of payments crisis.
Foreign currency reserves have fallen to as low as $9.8 billion, hardly enough for five weeks of imports. The Pakistani rupee has weakened to record lows. The new government needs to cut spending rapidly now as it spends 40% of its revenues on interest payments.
Western sanctions wrestled Russia into default last month read more and Belarus now facing the same tough treatment having stood with Moscow in the Ukraine campaign.
The Latin American country only defaulted two years ago but it has been rocked back into crisis by violent protests and an attempt to oust President Guillermo Lasso. read more
It has lots of debt and with the government subsidising fuel and food JPMorgan has ratcheted up its public sector fiscal deficit forecast to 2.4% of GDP this year and 2.1% next year. Bond spreads have topped 1,500 bps.
Bond spreads are just over 1,000 bps but Nigeria’s next $500 million bond payment in a year’s time should easily be covered by reserves which have been steadily improving since June. It does though spend almost 30% of government revenues paying interest on its debt.
“I think the market is overpricing a lot of these risks,” investment firm abrdn’s head of emerging market debt, Brett Diment, said.
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Reporting by Marc Jones; Additional Reporting by Rachel Savage in London and Rodrigo Campos in New York; Editing by Susan Fenton
Our Standards: The Thomson Reuters Trust Principles.
This past week brought home the magnitude of the overlapping crises assailing the global economy, intensifying fears of recession, job losses, hunger and a plunge on stock markets.
At the root of this torment is a force so elemental that it has almost ceased to warrant mention — the pandemic. That force is far from spent, confronting policymakers with grave uncertainty. Their policy tools are better suited for more typical downturns, not a rare combination of diminishing economic growth and soaring prices.
Major economies including the United States and France reported their latest data on inflation, revealing that prices on a vast range of goods rose faster in June than anytime in four decades.
China reported that its economy, the world’s second-largest, expanded by a mere 0.4 percent from April through June compared with the same period last year. That performance — astonishingly anemic by the standards of recent decades — endangered prospects for scores of countries that trade heavily with China, including the United States. It reinforced the realization that the global economy has lost a vital engine.
The specter of slowing economic growth combined with rising prices has even revived a dreaded word that was a regular part of the vernacular in the 1970s, the last time the world suffered similar problems: stagflation.
Most of the challenges tearing at the global economy were set in motion by the world’s reaction to the spread of Covid-19 and its attendant economic shock, even as they have been worsened by the latest upheaval — Russia’s disastrous attack on Ukraine, which has diminished the supply of food, fertilizer and energy.
“The pandemic itself disrupted not only the production and transportation of goods, which was the original front of inflation, but also how and where we work, how and where we educate our children, global migration patterns,” said Julia Coronado, an economist at the University of Texas at Austin, speaking this past week during a discussion convened by the Brookings Institution in Washington. “Pretty much everything in our lives has been disrupted by the pandemic, and then we layer on to that a war in Ukraine.”
Great Supply Chain Disruption.
meat production to shipping exploited their market dominance to rack up record profits.
The pandemic prompted governments from the United States to Europe to unleash trillions of dollars in emergency spending to limit joblessness and bankruptcy. Many economists now argue that they did too much, stimulating spending power to the point of stoking inflation, while the Federal Reserve waited too long to raise interest rates.
8 Signs That the Economy Is Losing Steam
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Worrying outlook. Amid persistently high inflation, rising consumer prices and declining spending, the American economy is showing clear signs of slowing down, fueling concerns about a potential recession. Here are other eight measures signaling trouble ahead:
Consumer confidence. In June, the University of Michigan’s survey of consumer sentiment hit its lowest level in its 70-year history, with nearly half of respondents saying inflation is eroding their standard of living.
The housing market. Demand for real estate has decreased, and construction of new homes is slowing. These trends could continue as interest rates rise, and real estate companies, including Compass and Redfin, have laid off employees in anticipation of a downturn in the housing market.
Copper. A commodity seen by analysts as a measure of sentiment about the global economy — because of its widespread use in buildings, cars and other products — copper is down more than 20 percent since January, hitting a 17-month low on July 1.
Oil. Crude prices are up this year, in part because of supply constraints resulting from Russia’s invasion of Ukraine, but they have recently started to waver as investors worry about growth.
The bond market. Long-term interest rates in government bonds have fallen below short-term rates, an unusual occurrence that traders call a yield-curve inversion. It suggests that bond investors are expecting an economic slowdown.
Now playing catch-up, central banks like the Fed have moved assertively, lifting rates at a rapid clip to try to snuff out inflation, even while fueling worries that they could set off a recession.
Given the mishmash of conflicting indicators found in the American economy, the severity of any slowdown is difficult to predict. The unemployment rate — 3.6 percent in June — is at its lowest point in almost half a century.
American consumers have enhanced fears of a downturn. This past week, the International Monetary Fund cited weaker consumer spending in slashing expectations for economic growth this year in the United States, from 2.9 percent to 2.3 percent. Avoiding recession will be “increasingly challenging,” the fund warned.
Orwellian lockdowns that have constrained business and life in general. The government expresses resolve in maintaining lockdowns, now affecting 247 million people in 31 cities that collectively produce $4.3 trillion in annual economic activity, according to a recent estimate from Nomura, the Japanese securities firm.
But the endurance of Beijing’s stance — its willingness to continue riding out the economic damage and public anger — constitutes one of the more consequential variables in a world brimming with uncertainty.
sanctions have restricted sales of Russia’s enormous stocks of oil and natural gas in an effort to pressure the country’s strongman leader, Vladimir V. Putin, to relent. The resulting hit to the global supply has sent energy prices soaring.
The price of a barrel of Brent crude oil rose by nearly a third in the first three months after the invasion, though recent weeks have seen a reversal on the assumption that weaker economic growth will translate into less demand.
major pipeline carrying gas from Russia to Germany cut the supply sharply last month, that heightened fears that Berlin could soon ration energy consumption. That would have a chilling effect on German industry just as it contends with supply chain problems and the loss of exports to China.
euro, which has surrendered more than 10 percent of its value against the dollar this year. That has increased the cost of Europe’s imports, another driver of inflation.
ports from the United States to Europe to China.
“Everyone following the economic situation right now, including central banks, we do not have a clear answer on how to deal with this situation,” said Kjersti Haugland, chief economist at DNB Markets, an investment bank in Norway. “You have a lot of things going on at the same time.”
Understand Inflation and How It Impacts You
The most profound danger is bearing down on poor and middle-income countries, especially those grappling with large debt burdens, like Pakistan, Ghana and El Salvador.
As central banks have tightened credit in wealthy nations, they have spurred investors to abandon developing countries, where risks are greater, instead taking refuge in rock-solid assets like U.S. and German government bonds, now paying slightly higher rates of interest.
This exodus of cash has increased borrowing costs for countries from sub-Saharan Africa to South Asia. Their governments face pressure to cut spending as they send debt payments to creditors in New York, London and Beijing — even as poverty increases.
U.N. World Food Program declared this month.
Among the biggest variables that will determine what comes next is the one that started all the trouble — the pandemic.
The return of colder weather in northern countries could bring another wave of contagion, especially given the lopsided distribution of Covid vaccines, which has left much of humanity vulnerable, risking the emergence of new variants.
So long as Covid-19 remains a threat, it will discourage some people from working in offices and dining in nearby restaurants. It will dissuade some from getting on airplanes, sleeping in hotel rooms, or sitting in theaters.
Since the world was first seized by the public health catastrophe more than two years ago, it has been a truism that the ultimate threat to the economy is the pandemic itself. Even as policymakers now focus on inflation, malnutrition, recession and a war with no end in sight, that observation retains currency.
“We are still struggling with the pandemic,” said Ms. Haugland, the DNB Markets economist. “We cannot afford to just look away from that being a risk factor.”
Square, another payments company, bought $50 million of Bitcoin and changed its name to Block, in part to signify its work with blockchain technology. Tesla bought $1.5 billion of it. The venture capital firm Andreessen Horowitz raised $4.5 billion for a fourth cryptocurrency-focused fund, doubling its previous one.
Excitement hit a peak in April last year when Coinbase, a cryptocurrency exchange, went public at an $85 billion valuation, a coming-out party for the industry. Bitcoin topped $60,000 for the first time.
Last summer, El Salvador announced that it would become the first country to classify Bitcoin as legal tender, alongside the U.S. dollar. The country’s president updated his Twitter profile picture to include laser eyes, a calling card of Bitcoin believers. The value of El Salvador’s $105 million investment in Bitcoin has been slashed in half as the price has fallen.
Senators and mayors around the United States began touting cryptocurrency, as the industry spent heavily on lobbying. Mayor Eric Adams of New York, who was elected in November, said he would take his first three paychecks in Bitcoin. Senators Cynthia Lummis, Republican of Wyoming, and Kirsten Gillibrand, Democrat of New York, proposed legislation that would create a regulatory framework for the industry, giving more authority to the Commodity Futures Trading Commission, an agency that crypto companies have openly courted.
Through the frenzy, celebrities fueled the fear of missing out, flogging their NFTs on talk shows and talking up blockchain projects on social media. This year, the Super Bowl featured four ads for crypto companies, including Matt Damon warning viewers that “fortune favors the brave.”
That swaggering optimism faltered this spring as the stock market plummeted, inflation soared and layoffs hit the tech sector. Investors began losing confidence in their crypto investments, moving money to less risky assets. Several high-profile projects crashed amid withdrawals. TerraForm Labs, which created TerraUSD, a so-called stablecoin, and Celsius, an experimental crypto bank, both collapsed, wiping out billions in value and sending the broader market into a tailspin.
SAN ANTONIO HUISTA, Guatemala — An American contractor went to a small town in the Guatemalan mountains with an ambitious goal: to ignite the local economy, and hopefully even persuade people not to migrate north to the United States.
Half an hour into his meeting with coffee growers, the contractor excitedly revealed the tool he had brought to change their lives: a pamphlet inviting the farmers to download an app to check coffee prices and “be a part of modern agriculture.”
Pedro Aguilar, a coffee farmer who hadn’t asked for the training and didn’t see how it would keep anyone from heading for the border, looked confused. Eyeing the U.S. government logo on the pamphlet, he began waving it around, asking if anyone had a phone number to call the Americans “and tell them what our needs really are.”
soared in 2019 and is on the upswing once more.
have risen, malnutrition has become a national crisis, corruption is unbridled and the country is sending more unaccompanied children to the United States than anywhere else in the world.
That is the stark reality facing Ms. Harris as she assumes responsibility for expanding the same kind of aid programs that have struggled to stem migration in the past. It is a challenge that initially frustrated her top political aides, some of whom viewed the assignment from Mr. Biden as one that would inevitably set her up for failure in the first months of her tenure.
Her allies worried that she would be expected to solve the entire immigration crisis, irked that the early reports of her new duties appeared to hold her responsible for juggling the recent surge of children crossing the border without adults.
linked to drug traffickers and accused of embezzling American aid money, the leader of El Salvador has been denounced for trampling democratic norms and the government of Guatemala has been criticized for persecuting officials fighting corruption.
Even so, Ms. Harris and her advisers have warmed to the task, according to several people familiar with her thinking in the White House. They say it will give her a chance to dive squarely into foreign policy and prove that she can pass the commander-in-chief test, negotiating with world leaders on a global stage to confront one of America’s most intractable issues.
critics denounced as unlawful and inhumane. Moreover, members of the current administration contend that Mr. Trump’s decision to freeze a portion of the aid to the region in 2019 ended up blunting the impact of the work being done to improve conditions there.
But experts say the reasons that years of aid have not curbed migration run far deeper than that. In particular, they note that much of the money is handed over to American companies, which swallow a lot of it for salaries, expenses and profits, often before any services are delivered.
Record numbers of Central American children and families were crossing, fleeing gang violence and widespread hunger.
independent studies have found.
“All activities funded with U.S.A.I.D.’s foreign assistance benefit countries and people overseas, even if managed through agreements with U.S.-based organizations,” said Mileydi Guilarte, a deputy assistant administrator at U.S.A.I.D. working on Latin America funding.
But the government’s own assessments don’t always agree. After evaluating five years of aid spending in Central America, the Government Accountability Office rendered a blunt assessment in 2019: “Limited information is available about how U.S. assistance improved prosperity, governance, and security.”
One U.S.A.I.D. evaluation of programs intended to help Guatemalan farmers found that from 2006 to 2011, incomes rose less in the places that benefited from U.S. aid than in similar areas where there was no intervention.
Mexico has pushed for a more radical approach, urging the United States to give cash directly to Central Americans affected by two brutal hurricanes last year. But there’s also a clear possibility — that some may simply use the money to pay a smuggler for the trip across the border.
The farmers of San Antonio Huista say they know quite well what will keep their children from migrating. Right now, the vast majority of people here make their money by selling green, unprocessed coffee beans to a few giant Guatemalan companies. This is a fine way to put food on the table — assuming the weather cooperates — but it doesn’t offer much more than subsistence living.
Farmers here have long dreamed of escaping that cycle by roasting their own coffee and selling brown beans in bags to American businesses and consumers, which brings in more money.
“Instead of sending my brother, my father, my son to the United States, why not send my coffee there, and get paid in dollars?” said Esteban Lara, the leader of a local coffee cooperative.
But when they begged a U.S. government program for funding to help develop such a business, Ms. Monzón said, they were told “the money is not designed to be invested in projects like that.”
These days, groups of her neighbors are leaving for the United States every month or two. So many workers have abandoned this town that farmers are scrambling to find laborers to harvest their coffee.
One of Ms. Monzón’s oldest employees, Javier López Pérez, left with his 14-year-old son in 2019, during the last big wave of Central American migration to the United States. Mr. López said he was scaling the border wall with his son when he fell and broke his ankle.
“My son screamed, ‘Papi, no!’ and I said to him, ‘Keep going, my son,’” Mr. López said. He said his son made it to the United States, while he returned to San Antonio Huista alone.
His family was then kicked out of their home, which Mr. López had given as collateral to the person who smuggled him to the border. The house they moved into was destroyed by the two hurricanes that hit Guatemala late last year.
Ms. Monzón put Mr. López in one of her relatives’ houses, then got the community to cobble together money to pay for enough cinder blocks to build the family a place to live.
While mixing cement to bind the blocks together, one of Mr. López’s sons, Vidal, 19, confessed that he had been talking to a smuggler about making the same journey that felled his father, who was realistic at the prospect.
“I told him, ‘Son, we suffered hunger and thirst along the way, and then look at what happened to me, look at what I lost,’” Mr. López said, touching his still-mangled ankle. “But I can’t tell him what to do with his life — he’s a man now.”