Left-moving Latin America seen as vocal backlash at U.S.

Reuters, 05.22.03, 4:32 PM ET By Alistair Scrutton

BUENOS AIRES, Argentina (Reuters) - Latin America's political shift to the left after a decade embracing U.S.-promoted market reform may be more strident reaction than a serious policy move, analysts say, highlighting the lack of viable alternatives.

The rise to power of another left-leaning government in South America, with Argentina's President-elect Nestor Kirchner promising to be more independent of Washington when he takes over on Sunday, appears to confirm a voter backlash against U.S. influence in the region after years of economic woes.

Center-left Kirchner joins Brazil's President Luiz Inacio Lula da Silva and Venezuela's populist President Hugo Chavez as leaders openly critical of U.S. policies such as free trade, market reforms, the Cuba embargo or the Iraq war.

Suffering from economic downturn, many of Latin America's 500 million people are tired of the "Washington consensus" of market reforms, unfettered investments and diplomatic closeness in the 1990s -- when Argentina sent troops to the Gulf War.

But the rhetoric seems to be louder than the action, especially over the economy where budget austerity and free trade are still at the forefront of policies -- if only for want of an alternative.

"In Latin America, the issue is not security or geo-political strategy but economic, and on economic policy little has changed," a Western diplomat said.

Ricardo Israel, head of the Political Sciences Institute of the University of Chile, said: "Leaders may blame globalization but they have very little alternatives to offer."

Latin Americans feel poorer as economies have struggled, highlighted by riots in Peru and Paraguay and financial crises in Argentina, Brazil and Uruguay over the last year.

Argentina's crisis gave rise to the IMF moniker International "Misery" Fund and Lula was hailed as a victory for the excluded in the region's biggest economy.

Washington has struggled to win Latin American support to condemn Cuban human rights violations. Chavez, a close ally of Cuban President Fidel Castro, is one of the most vocal leaders against what he calls U.S. "imperialism." Even Mexico and Chile, traditional allies, did not back the invasion of Iraq.

LET'S NOT PICK A FIGHT

"There's a degree of resentment against the U.S. not seen for a while due to its unilateralism. On the other hand there's a very heavy dose of pragmatism -- not wanting to pick a fight," said Peter Hakim of Inter-American Dialogue, a Washington think-tank.

Kirchner criticizes IMF austerity plans and wants an alliance with Brazil before agreeing to a U.S.-promoted Free Trade Area of the Americas, a contrast to the 1990s when Argentina was a key U.S. ally that pegged its currency to the dollar.

But with a weak mandate at home, Kirchner needs foreign support, especially the IMF, to win back investor confidence. "U.S. relations will be just a little more formal, they won't be so openly friendly " said political analyst Manuel Mora y Araujo.

Brazil is key for progress on the free trade agreement by 2005, the world's largest free trade zone covering the Western Hemisphere. Lula calls the free trade agreement a U.S. attempt to "annex" Latin America, "There's been a more confrontational stance on free trade," said Joao Teixeira, of the Prospectiva consultancy in Brazil. "But Brazil does not have many instruments to put rhetoric into action," he added.

"Rather than a move to the left, it's more a move toward caution," said Nicolas Shumway, head of Latin American studies at the University of Texas in Austin.