Welcome back to Foreign Policy’s Latin America Brief.
The highlights this week: New revelations about the online trolls shaping Latin American politics, Colombia crowns new Women’s World Cup stars, and hawkish central banks fight inflation.
Over the past decade, fact-checkers and newsrooms have stepped up to referee the stream of false information inundating Latin American politics. Far less visible are the creators of this content. But this week, media organizations from 14 different Latin American countries, as well as Spain and the United States, began releasing a set of reports that have lifted the veil on the often unseen actors spreading false digital narratives.
The reports, coordinated by the Latin American Center for Investigative Journalism (CLIP), reveal how disinformation has been deployed across the region in recent years—and that the systems that are supposed to catch it have often failed to do so. Operating on both sides of the political spectrum, many of these so-called digital mercenaries have evaded consequences from social media platforms and government agencies.
In Mexico, according to one report, a marketing group founded by César Hernández Paredes created mock news sites that published stories favorable to his clients around the time of elections. The group also made large numbers of fake social media accounts to spread messages of support. (This was just one of the many troll farms identified in the CLIP reports.) Hernández worked for left-wing politicians, including members of Mexico’s ruling Morena party, as well as former Bolivian President Evo Morales, former Ecuadorian President Rafael Correa, and Venezuelan President Nicolás Maduro. Meta, the parent company of Facebook, took down some of Hernández’s fake accounts in Bolivia, and authorities investigated him for irregularities related to contracts in Bolivia, Ecuador, and Spain, where he worked for the left-wing Podemos party. However, CLIP did not report any court cases against Hernández’s actions in Mexico.
In Chile, the CLIP partners reported that Argentine marketeer Fernando Cerimedo’s company registered the website where a viral lie appeared claiming the country’s 2022 draft constitution would end private homeownership. Although some Chileans denounced the false claim to the organization that administered the web domain, the website only disappeared months later. Some analysts say the broader flood of fake news surrounding the politically progressive draft constitution contributed to it being rejected in a nationwide referendum in September 2022.
In Brazil, however, election authorities have taken a more aggressive stance against disinformation. Cerimedo spread falsehoods in the aftermath of Brazil’s 2022 election, but the country’s electoral court acted quickly to take down the content. For example, after losing the vote, former far-right President Jair Bolsonaro and his supporters claimed without evidence that there was election fraud. When Cerimedo published a video echoing this, the court had it removed within one day. (This, however, hasn’t stopped him from working for far-right Argentine presidential candidate Javier Milei in the current election season.)
Brazil’s approach differs from those used in Mexico and Chile, where election authorities rely on labeling and fact-checking to police disinformation but stop short of ordering publishers to remove the content.
Some critics believe Brazil has given the electoral court too much power over online speech, but its approach was created in response to public concerns that social media platforms were falling short of their own commitments to police content. For instance, independent watchdog Global Witness found that Facebook failed to detect election-related disinformation ads ahead of Brazil’s 2022 election.
Latin America’s political troll farm problem occurs against a backdrop of low trust in political parties and steadily declining trust in news media. Funding for professional journalism is scarce amid a slow post-pandemic recovery, causing many news organizations to downsize. Making matters worse, most outlets in the region lack opinion sections that are fact-checked and well-edited, Venezuelan-American writer and former New York Times en Español opinion editor Boris Muñoz wrote for the Wilson Center this year.
With low trust in the press, it is even more difficult to foster healthy political debate in these countries. But, according to Muñoz, a silver lining of traditional journalism’s slump has been the explosion of new digital news organizations producing high-quality work in Latin America, many of which participated in the CLIP investigation.
It is still very much an open question what long-term policies election regulators or other authorities in the region will establish to safeguard against online disinformation, although proposals on the matter have been floated in Brazil and Chile in recent months. Many experts have argued for better media literacy training and more academic research on disinformation rather than giving governments the power to remove content. In the meantime, CLIP’s reporting provides a valuable look at the shortcomings and successes of the current guardrails.
Tuesday, Aug. 8, to Wednesday, Aug. 9: Brazilian President Luiz Inácio Lula da Silva hosts a regional summit on the Amazon.
Sunday, Aug. 13: Argentina holds mandatory primary elections.
Sunday, Aug. 20: Guatemala holds a presidential runoff election, and Ecuador holds snap general elections.
Argentina’s big borrow. Last Friday, Argentina’s government reached an agreement with the International Monetary Fund (IMF) to avert a potential default on its loan to the Fund, which could have further destabilized the country’s economy ahead of its October election. The fund will lower the amount of foreign currency that it requires Argentina to hold, and Argentina will implement steps to weaken its currency for trade purposes without going through a sharp currency devaluation.
Argentina will draw on credit from China to pay back its outstanding debt, and while it has not announced the interest rate on its yuan loans, economists estimate it will be about 6 percent, the Financial Times reported. Its rate from China is likely well above the rate it gets from the IMF, Economist Intelligence Unit analyst Nicolás Saldías tweeted this week, adding that the arrangement is like “paying off a low-interest debt [with] credit cards.”
Spies in the spotlight. Brazil has denied a U.S. request to extradite Sergey Cherkasov, a Russian man who is serving prison time in Brazil on charges of faking identity documents. Cherkasov had spent time both in the United States and Brazil before he was arrested last year after a tip from the Dutch intelligence agency, which said in a press release that he had long been an undercover spy. Soon after Cherkasov’s arrest, Russia sought to extradite him, and the United States followed suit.
The competing requests put pressure on Brazil amid Russia’s ongoing invasion of Ukraine; though Brazil has voted against Russia in the United Nations, it has otherwise not condemned the country as vocally as many Western countries would like. Brazil is an ally of the United States, but it is also a member of the BRICS grouping with Russia, India, China, and South Africa and heavily relies on Russia for its fertilizer imports. U.S. officials reportedly hoped to swap Cherkasov for one or both of the two Americans currently detained in Russia on espionage charges, former Marine Paul Whelan and Wall Street Journal reporter Evan Gershkovich.
Last week, Brazilian Justice Minister Flávio Dino said Cherkasov would continue to serve his sentence in Brazil, although, separately, a court reduced his sentence from 15 years down to five.
Auf Wiedersehen. Colombian soccer player Linda Caicedo made headlines on Sunday when she maneuvered past three German defenders to score a goal in a game that has been called the biggest upset of the Women’s World Cup so far. Her teammate Manuela Vanegas then headed in another goal in stoppage time for a 2-1 victory. The match contributed to Germany’s elimination from the tournament’s group stage, marking the first time the German team, a favorite to win this year’s cup, has not made it to at least the quarterfinal round of play.
By FIFA’s count, Colombians have watched this year’s tournament in record numbers: The television audience inside the country for Colombia’s opening game against South Korea was the largest-ever for any Women’s World Cup match. The Colombian team now advances from group play to the knockout round, with its next match scheduled for Aug. 8.
Which team will join—and face—Colombia in the round of 16 of the Women’s World Cup?
Another major upset was Jamaica’s 0-0 draw with Brazil on Tuesday, which eliminated Brazil from the tournament.
Central bankers in some of Latin America’s largest economies—Brazil, Colombia, Mexico, and Chile—responded far more aggressively to post-pandemic rises in inflation than their counterparts in the United States and Europe. Even prior to Russia’s invasion of Ukraine and the subsequent rise in global energy prices, they had begun hiking interest rates to levels that currently stand above 10 percent.
The interest rate hikes were designed to push down inflation by slowing down the economy overall. Central banks elsewhere in the world were more cautious about the side effects of interest rate hikes. But for many Latin American central bankers, the hawkish stance appeared to reflect memories of uncontrolled inflation crises in the 1980s.
Efforts to reduce inflation have already started working in several countries: In June, annual inflation was 3.2 percent in Brazil, 5.1 percent in Mexico, and 7.6 percent in Chile. It peaked near or above 10 percent in all of those countries last year. Acknowledging those effects, Brazil’s central bank announced on Aug. 2 that it would lower rates for the first time in three years, following a similar move by Chile the week prior.
While high interest rates have helped curb inflation, they have also created other, less desirable ripple effects. For example, faced with more expensive mortgage rates, many families in the region who were considering buying a home instead held back. In Brazil, the number of people who are currently in default on personal debt remains high—about 67 million as of May. The rates have also constricted companies wanting to invest, prompting not only Brazil’s president but also a federation of industrial firms to publicly call for the central bank to make a rate cut.
Meanwhile, a new weather pattern may make prices even harder to tame: Scientists say there will likely be a moderate El Niño weather cycle on the Pacific coast of South America in the second half of the year. It could exacerbate droughts, cause floods, and spark fresh inflation.