Lula 3.0 Takes Shape

Welcome back to Foreign Policy’s Latin America Brief.

The highlights this week: Lula begins his third term as Brazil’s president, Ecuador and China reach a trade agreement, and a detention in Bolivia yields disruptive protests.

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Leftist Luiz Inácio Lula da Silva was sworn in as Brazil’s president for the third time on Sunday. His right-wing predecessor Jair Bolsonaro flew to Florida rather than hand over the presidential sash, so a group representing the Brazilian people—including a garbage collector, a 10-year-old boy, and an Indigenous leader—presented it to Lula instead.

On the campaign trail, Lula sought to attract a wide coalition of voters ranging from center-right to far-left and thus tended toward broad rather than specific statements about his policy plans. In recent weeks, as he tapped his ministers—and they began making public statements and staffing announcements—Lula’s priorities have come into better focus.

Of Lula’s 37 ministers, only 27 percent hail from his Workers’ Party (PT), a smaller share than in his previous cabinets named in 2003 and 2007. Instead, many ministers are independents or members of catch-all and center-left parties that joined the PT to form majority coalitions in both houses of Brazil’s National Congress. Lula’s cabinet sets important diversity records: 30 percent of ministers are women, and 27 percent self-identify as brown or Black, according to the news site Alma Preta. It also includes the first-ever Indigenous minister, who heads the newly created Ministry of Indigenous Peoples.

Lula has repeatedly said he would govern for all Brazilians, including those who voted for Bolsonaro—a vow he repeated in his two inaugural addresses on Sunday. Still, one question that has hung over the presidential transition is how officials in the new administration will treat hardcore Bolsonaro supporters who have been accused of planning political violence and breaking other laws in the wake of last October’s election.

Bolsonaro has been linked to election-related wrongdoing in both official inquiries and media reports. Electoral authorities are probing the former president for his unsubstantiated attacks on electronic voting machines, and O Globo’s Lauro Jardim wrote that Bolsonaro’s office hosted a meeting that planned police blitzes in pro-Lula areas on election day.

While some observers argue that potential criminal charges against Bolsonaro could shore up Brazil’s democracy, they could also give Bolsonaro fuel to claim he is being politically persecuted. The debates about how Brazil’s institutions should respond to Bolsonaro have broad parallels to those about whether to prosecute former U.S. President Donald Trump for his role in the U.S. Capitol insurrection on Jan. 6, 2021.

Lula and his justice minister, Flávio Dino, have made comments in recent days suggesting they plan to follow in the steps of the Brazilian Supreme Federal Court’s no-tolerance approach to insurrectionism. In the wake of the Oct. 30, 2022, runoff, Justice Alexandre de Moraes approved fines for election-denying protesters who blocked Brazilian highways and issued more than 100 search warrants and at least 11 arrest warrants related to the protests.

Dino said in an interview on the television show Roda Viva on Dec. 19 that he would take a similarly robust approach, adding that punishment for anti-democratic acts “is not a political decision. It is an obligation.” On Sunday, Lula echoed the message in an inaugural address to Congress, saying that “those who made mistakes will respond for their errors, with a broad right to defense, according to proper legal procedure.”

Bolsonaro’s tight margin in the presidential election and success electing allies to Congress left him in a strong position immediately after the vote. But the swift measures from Moraes and early signaling from the Lula administration appear to have contributed to the outgoing president’s departure from the country. (It is unclear how long Bolsonaro plans to stay in Florida.) Bolsonaro is far from completely deflated—and Lula’s new defense minister struck a more conciliatory tone toward the recent protests than did Dino—but he is politically weaker than he was two months ago.

A second major question about Lula’s new government is how seriously it will handle environmental policy. At the United Nations Climate Change Conference in Egypt last November, Lula framed Brazil’s environmental commitments as the source of legitimacy with which the country would reinsert itself into global affairs. But Lula’s own record on this front contains ambiguities: In his last administration, renowned environmentalist Marina Silva resigned as environment minister amid policy differences over mega-dam construction and problems enforcing rainforest protection measures.

Last week, Lula announced Silva’s return as environment minister. Her swearing-in ceremony on Wednesday revealed that Lula gave her a commitment she had sought from him, but did not always receive, during the 2000s: that environmental concerns be considered in the design of all public policies. “Marina, you can count on us,” Lula’s chief of staff, Rui Costa, said in a speech at the Wednesday event, adding that “the environment ministry will be invited, called to participate, from at the beginning of the design” of public policies rather than at the end.

Lula, meanwhile, spent Monday—his first full day in office—in a series of bilateral meetings with South American leaders. There, he pitched the idea of a regional summit on Amazon rainforest protection in the first half of this year­, suggesting that environmentalism will be a focus of his foreign policy.

Ministerial speeches this week offered a glimpse into the new government’s economic priorities, too. Vice President Geraldo Alckmin will also serve in the key economic post of minister of development, industry, trade, and services. Though Alckmin has been described as one of the more pro-market figures on Lula’s economic team, he spoke at length in his swearing-in ceremony about the need for policies that promote a green reindustrialization of Brazil.

It’s the same goal the Biden administration is addressing in the United States through its own green industrial policy package, the Inflation Reduction Act. The landmark bill included around $370 billion for clean energy and is even inspiring a similar plan in France. Brazil, however, is aiming to cut its budget rather than expand it. If Lula and Alckmin manage to boost the country’s manufacturing sector at the same time, it could be a breakthrough and a potential template for other middle-income economies.

Friday, Jan. 6: Brazilian prosecutors reportedly plan to reinstate a fraud case against George Santos, a newly elected member of the U.S. House of Representatives who was probed by Brazilian courts in 2011.

Friday, Jan. 6, to Tuesday, Jan. 10: Japan’s foreign minister visits Ecuador, Brazil, and Argentina.

Monday, Jan 9, to Tuesday, Jan. 10: U.S. President Joe Biden and Canadian Prime Minister Justin Trudeau visit Mexico for the North American Leaders’ Summit.

Wednesday, Jan. 11: The U.N. Security Council holds a briefing on Colombia.

China-Ecuador deal. Ecuadorian President Guillermo Lasso said on Tuesday that he had reached a free trade deal with China after 11 months of negotiation. The full details of the agreement have not been made public, though Ecuador’s production ministry said the deal would improve the financial terms for 99 percent of Ecuadorian exports to China. Joint trade between the two countries is worth an estimated $10 billion per year, and China was Ecuador’s main non-oil trade partner in the first half of 2022.

Once signed, the deal would make Ecuador the fourth Latin American country to have a free trade agreement with China. Though Chinese development banks paused new lending to Latin American countries over the past three years, Latin America’s trade with China hit a record $450 billion in 2021, Felipe Larraín and Pepe Zhang wrote in Americas Quarterly.

Venezuelan opposition leader Juan Guaidó waves while leaving a demonstration to demand a date for presidential elections in Caracas on Oct. 27, 2022.FEDERICO PARRA/AFP via Getty Images

Guaidó goes. Venezuela’s opposition removed Juan Guaidó as the leader of its shadow government in a vote last week. Guaidó was the figurehead of a failed 2019 effort to oust President Nicolás Maduro and was backed by the United States as well as many South American and European countries.

The vote came as the opposition prepares for a new phase of negotiations with Maduro in the coming months, in which they aim to receive guarantees on conditions for Venezuela’s 2024 presidential election. On Wednesday, a White House spokesperson shied away from answering questions about whether Washington still recognized Guaidó as Venezuela’s rightful president. Many governments that formerly recognized him, such as the European Union, have since dropped their recognition.

A new top justice in Mexico. Mexico elected its first female Supreme Court chief justice this week. As a judge on the 11-person court, Norma Lucía Piña had challenged President Andrés Manuel López Obrador’s efforts to increase state control over the energy grid by arguing that parts of those efforts clashed with Mexico’s constitutional obligation to cut emissions. Piña won the court’s own internal election against Yasmin Esquivel, who was backed by López Obrador.

Mexico’s Supreme Court has made a handful of progressive decisions in recent years, including 2021 rulings that recreational cannabis use and abortion should be decriminalized.

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Supporters of Santa Cruz Gov. Luis Fernando Camacho hold a demonstration outside the provincial police command to demand his release in Santa Cruz, Bolivia, on Jan. 2.RODRIGO URZAGASTI/AFP via Getty Images

Peru is not the only South American country where street protests have blocked traffic in recent weeks. In Bolivia, the Dec. 28 arrest of Luis Fernando Camacho, the right-wing governor of Santa Cruz province, prompted demonstrators to put up road blockades. Multiple demonstrators were wounded in recent days amid a police crackdown on the marches, which are ongoing.

Camacho’s detention was part of authorities’ investigations into the events surrounding former President Evo Morales’s departure from office in 2019. After a disputed election, followed by nationwide protests and a request from Bolivia’s military chief for him to step down, Morales fled to Mexico. In 2020, another member of Morales’s party, Luis Arce, won the presidential election, and Arce’s government has overseen investigations that claim the 2019 events amounted to a coup.

Many of the protesters objected to the fact that Camacho was detained under broad anti-terrorism legislation and voiced concerns that he was not receiving due process.

“The crime of terrorism has been used by left- and right-wing opponents in Bolivia as an instrument to persecute opponents,” Human Rights Watch’s César Muñoz told Reuters.

Last year, the World Justice Project ranked Bolivia 130 out of 140 countries for the integrity of its judicial system. As of January 2020, around 65 percent of Bolivian prisoners were estimated to be in pre-trial detention; tellingly, one of Camacho’s political allies has been jailed for a year without trial as part of the same investigation for which Camacho was detained.

At present, the events surrounding Camacho’s arrest “far from weakening the far right, strengthened it,” the environmentalist and former diplomat Pablo Solón wrote in a blog post.

The U.S. Justice Department is also investigating events related to Bolivia’s conservative interim government that replaced Morales in 2019. On Wednesday, a federal court in Florida announced a six-year sentence on charges of bribery for former Bolivian interior minister Arturo Murillo, who served in the short-lived interim government.