Crisis Hits Oil Industry and Energy Transition Alike

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Energy

Mexico's state-run oil giant Pemex faces a difficult outlook due to the fall in international oil prices and the crisis resulting from the coronavirus pandemic, which threatens its production and finances, in a situation analysed during the 29th La Jolla Energy Conference, organised online by the Institute of the Americas. CREDIT: Emilio Godoy/IPS

Mexico’s state-run oil giant Pemex faces a difficult outlook due to the fall in international oil prices and the crisis resulting from the coronavirus pandemic, which threatens its production and finances, in a situation analysed during the 29th La Jolla Energy Conference, organised online by the Institute of the Americas. CREDIT: Emilio Godoy/IPS

MEXICO CITY, May 22 2020 (IPS) – While it attempts to cushion the effects of the coronavirus pandemic, the Latin American and Caribbean region also faces concerns about the future of the energy transition and state-owned oil companies.


These questions were discussed at the 29th La Jolla Energy Conference, organised by the Institute of the Americas. It was held online May 18-22, rather than bringing together more than 50 speakers at the institute’s headquarters in the coastal district of San Diego, in the U.S. state of California, in the midst of the COVID-19 pandemic.

Alfonso Blanco of Uruguay, executive secretary of the Latin American Energy Organisation (OLADE), said during a session on global trends and the regional energy industry that the changes seen during the pandemic will spread after the crisis and will be long-lasting.

“There will be structural transformations and we are convinced that most consumer behaviors will change after the pandemic. Demand will vary due to changes in the main areas of transportation and other energy areas. The effects on fossil fuel consumption will be strong and there will be a greater impact on renewable energies,” he said.

OLADE, a 27-member regional intergovernmental organisation for energy coordination, estimates that electricity demand has fallen by 29 percent in Bolivia compared to 2019, as a result of the severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2), which causes COVID-19, and by 26 percent in Argentina, 22 percent in Brazil and 11 percent in Chile.

“There will be structural transformations and we are convinced that most consumer behaviors will change after the pandemic. Demand will vary due to changes in the main areas of transportation and other energy areas. The effects on fossil fuel consumption will be strong and there will be a greater impact on renewable energies.” — Alfonso Blanco

Likewise, final energy demand plummeted 14 percent in Brazil compared to 2019, 11 percent in both the Andean and Southern Cone regions, nine percent in Mexico, seven percent in Central America and five percent in the Caribbean.

As countries went into lockdown to curb the spread of COVID-19, electricity consumption by businesses and factories declined, due to the suspension of activities.

Leonardo Sempertegui, legal advisor to the Organisation of Petroleum Exporting Countries (OPEC), said the pandemic may be a wake-up call for countries lagging behind in the energy transition.

“This may be the new normal. The structure and governance of the energy architecture to cope with the next phase are changing dramatically. Energy poverty and the energy transition cannot be solved regardless of who controls a resource; these challenges cannot wait,” he said in the same session.

In Latin America, nations like Argentina, Bolivia, the Dominican Republic, Ecuador, Honduras and Uruguay have made progress in the energy transition since 2015, while Brazil has slid backwards and countries like Mexico are stuck in the same place, according to the World Economic Forum’s Energy Transition Index, released May 13.

As the region heads into the fourth month of the pandemic, countries are assessing their electricity markets, which have been shaken by the crisis.

Nations like Argentina, Chile, Colombia and Peru have resorted to long-term electricity auctions, which have generated low prices for renewables, while Mexico suspended such schemes in 2019.

In Argentina, as Andrés Chambouleyron, a non-resident fellow at the Institute of the Americas, explained, industrial consumption fell by 50 percent and electricity distributors have not been able to obtain sufficient revenues to cover fixed costs or electricity purchases.

The government has thus provided financing to Cammesa – the electricity wholesale market administration company – to pay the generators, since it is bound by contracts to buy the energy.

“There will be a permanent change in electricity consumption in Argentina. We have cheaper gas than before; the models say that you have to use more gas because it is cheaper than other sources. We won’t see much change in Argentina’s energy mix, and that could extend to all of Latin America,” said Chambouleyron, who warned of breach of and renegotiation of contracts for energy purchases.

Low oil prices threaten to slow down the energy transition in Latin America, although renewable energies already compete with the costs of fossil fuels, agreed experts at the 29th La Jolla Energy Conference, organised online by the Institute of the Americas. The photo shows solar panels on a house in Ajijic, in the western Mexican state of Jalisco. CREDIT: Emilio Godoy/IPS

Low oil prices threaten to slow down the energy transition in Latin America, although renewable energies already compete with the costs of fossil fuels, agreed experts at the 29th La Jolla Energy Conference, organised online by the Institute of the Americas. The photo shows solar panels on a house in Ajijic, in the western Mexican state of Jalisco. CREDIT: Emilio Godoy/IPS

While renewables are already competing in price with conventional sources, low oil and gas prices undermine their expansion, a predicament that alternative energy sources have been facing in recent years.

In addition, the rise in the cost of international credit and the fluctuations of the dollar against local currencies may make generation more expensive.

In another session on the outlook for state-owned oil companies, Marta Jara, former president of Uruguay’s public oil company ANCAP, said the current crisis could accelerate the transition, but called it a “major challenge”.

“The temptation is to be opportunistic and forget the roadmap of the energy transition. We must invest in sustainable energy systems, decarbonise transport. It is important to secure funding and create jobs. I hope the crisis opens the door to be more innovative,” she said.

Viable or not?

The plunge in fossil fuel prices is damaging the finances of the region’s oil producing countries, such as Argentina, Bolivia, Brazil, Colombia, Ecuador, Mexico, Peru and Venezuela, and state companies in the sector are facing problems with regard to planning and operations.

But it benefits net importers, like the countries of Central America or Chile, whose oil bills have shrunk, while for consumers in both oil producing and importing countries the cost of electricity could go down.

“The most competitive will be the countries with lower oil extraction costs. Some projects will not be economically viable. We will see greater economic problems than in 2019,” predicted Lisa Viscidi, director of the Energy, Climate Change and Extractive Industries Programme at the non-governmental Inter-American Dialogue, during a panel on the situation in several Caribbean nations.

The pandemic and a rise in Saudi production announced on Mar. 10 led to a collapse in oil prices and the consequent risk of bankruptcies in the industry. State-owned oil companies have fared better than others so far in the crisis.

In another session on the outlook for state-owned oil companies, John Padilla, managing director of the private consulting firm IPD Latin America, stated that “it will take time to get out of this situation, with effects for the region, and the need for great efficiency.

“Most nations have been exporters, efficiency will be the key. What has not been done is to cultivate domestic and regional markets, state enterprises are not going to play the same role as they always have,” he said.

Public companies such as Brazil’s Petrobras and Colombia’s Ecopetrol entered the crisis in a better position than Mexico’s Pemex, Venezuela’s PDVSA and Argentina’s YPF, according to experts.

“These are difficult times, even for the best prepared. We can hope that if the country and its company are in trouble, if governments need money, they can get more out of the companies,” said Francisco Monaldi, interim director of the Baker Institute for Public Policy’s Latin America Initiative at the private Rice University in the U.S. state of Texas.

In his view, “Mexico is in better fiscal conditions, it should not be a problem. But Pemex can drag Mexico down. If the government doesn’t change direction, it could become a serious problem,” he said as an example.

Although Pemex will increase its investment in 2020, the oil company reported losses of 20 billion dollars in the first quarter of this year. Due to the crisis, Petrobras limited its investment to 3.5 billion dollars and its daily production to 200,000 barrels, and postponed the sale of eight refineries.

For Lucas Aristizábal, a senior director in Fitch Ratings’ Latin American corporates group, some state-owned oil companies are viable and others are not.

“In 2021, the financial contribution of oil will be lower for governments. If they want the companies to play a key role, they will put more pressure on their financial structure. The current situation illustrates the economics of these corporations,” he said during the forum.

Pemex and YPF were already losing money per barrel in 2019, while Petrobras has more balanced production costs.

On the oil horizon, and in the midst of the COVID-19 crisis, Guyana has become the rising star, although there is still political uncertainty, as the result of the Mar. 2 presidential elections is still unclear.

“It’s hard to predict what will happen. There is a risk of U.S. sanctions that would not affect investment in the sector, but would pose a political risk to the country,” said Thomas Singh, in the Department of Economics at the public University of Guyana.

The country expects to extract 600,000 barrels per day by 2024 and take in revenues of five billion dollars, with reserves exceeding five billion barrels.

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Mexico’s Development Banks Fuel the Fossil Energy Trade

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Energy

Demonstrators demand clarification of the murder of land rights activist Samir Flores and the shutdown of a thermoelectric plant in the state of Morelos, in central Mexico, in a February 2019 protest on Mexico City's emblematic Paseo Reforma. CREDIT: Emilio Godoy/IPS

Demonstrators demand clarification of the murder of land rights activist Samir Flores and the shutdown of a thermoelectric plant in the state of Morelos, in central Mexico, in a February 2019 protest on Mexico City’s emblematic Paseo Reforma. CREDIT: Emilio Godoy/IPS

MEXICO CITY, May 20 2020 (IPS) – Since 2012, Teresa Castellanos has fought the construction of a gas-fired power plant in Huexca, in the central Mexican state of Morelos, adjacent to the country’s capital.


“We don’t want the power plant to operate, because it will cause irreparable damage, polluting the water and air. This project was imposed on us; we have to defend the water and the land. This is not an industrial zone,” the activist, coordinator of the Huexca Resistance Committee, told IPS.

During the tests, the constant noise of the turbines also altered the life of this small community of just over 1,000 people, mostly farmers, near the Cuautla River, within the rural municipality of Yecapixtla.

“Development banks must have safeguards and principles for sustainable investment. National regulations are needed, which define climate finance and green finance, what principles govern them, what are the climate risks. The trend should be to increasingly finance green projects and less and less hydrocarbons.” — Liliana Estrada

The Central Combined Cycle Plant, located in Huexca and with a capacity of 620 megawatts based on gas and steam, is part of the Morelos Integral Project (PIM), developed by the state Federal Electricity Commission (CFE). It also consists of an aqueduct and a gas pipeline that crosses the states of Morelos, Puebla and Tlaxcala.

The People’s Front in Defence of Land and Water of Morelos, Puebla and Tlaxcala and its ally, the Permanent Assembly of the People of Morelos, have managed to get several court orders that have blocked the operation of the plant, the 12-km aqueduct and the 171-km gas pipeline since 2015.

Castellanos, who has won an international and a national award for her activism, has been involved in the battle against the plant from the very start, which has earned her persecution and threats.

The opposition to the power plant by local communities that depend on planting corn, beans, squash and tomatoes and raising cattle and pigs, focuses on the lack of consultation, the threat to their agricultural activity, due to the extraction of water from the rivers, and the discharge of liquid waste.

In February 2019, a public consultation that did not meet international standards supported the completion of the project.

A few days earlier, activist Samir Flores had been murdered, a crime that remains unsolved – just one more instance of violence against environmentalists in Mexico. Despite Flores’ murder, the government of leftist President Andrés Manuel López Obrador went ahead with the referendum and upheld the result.

Public funds have fuelled the conflict, as the state-owned National Bank of Public Works and Services (Banobras) lent some 55 million dollars for the pipeline.

As in the case of other projects, development banks have become a financial pillar for the oil industry in Latin America’s second-largest nation, population 130 million.

The National Bank of Foreign Trade (Bancomext), Banobras and Nacional Financiera (Nafin) have funneled millions of dollars into building pipelines and oil and gas facilities in recent years, even though the climate change crisis makes it necessary to abandon such investments.

They have also financed renewable energy projects, but in much smaller amounts than fossil fuels.

The construction and operation of the Central Combined Cycle Plant, of the state Federal Electricity Commission, financed with public funds, unleashed a conflict with residents of Huexca, a small community in the central Mexican state of Morelos, which has brought the operation of the thermoelectric plant to a halt. CREDIT: Emilio Godoy/IPS

The construction and operation of the Central Combined Cycle Plant, of the state Federal Electricity Commission, financed with public funds, unleashed a conflict with residents of Huexca, a small community in the central Mexican state of Morelos, which has brought the operation of the thermoelectric plant to a halt. CREDIT: Emilio Godoy/IPS

Energy reform pillar

The energy reform that then conservative president Enrique Peña Nieto (2012-2018) enacted in 2013 opened the sector to private capital, broke the monopoly of the state-owned Petroleos Mexicanos (Pemex) oil giant and CFE, and made Mexico an attractive market for international investment in the sector.

To support this transformation, the state development banks also opened their coffers.´

Since 2012, Banobras, which finances infrastructure and public works and services, has lent at least 721 million dollars for the construction of gas pipelines, 10.2 billion dollars for oil and gas projects, 251 million dollars for electrical cogeneration, from steam generated in hydrocarbon plants, and eight million dollars for the construction of a thermoelectric plant that will burn fuel oil in the northwestern state of Baja California Sur.

Bancomext, which provides financing to exporters, importers and nine strategic sectors, has delivered some 500,000 dollars to oil companies in the eastern state of Tamaulipas and another 446 million dollars in Mexico City. It has also provided 65.4 million dollars to gas initiatives in the northern state of Nuevo Leon and 626.7 million dollars in Mexico City.

In addition, it has contributed 1.5 billion dollars for the supply of gas through pipelines to the final consumer; 324 million dollars for the extraction of oil and gas; 216 million dollars for the construction of public works for oil and gas; 126 million dollars for the manufacture of products derived from oil and coal; nearly seven million dollars for oil refining; 0.65 million dollars for the commercialisation of fuels; 0.25 million dollars for the drilling and maintenance of hydrocarbon wells; as well as 0.25 million dollars for oil platform maintenance and services.

In February, Bancomext granted a loan of 7.1 million dollars to Grupo Diarqco, in what it presented as the first credit to a private Mexican company in the industry, to exploit an oil field in the southeastern state of Tabasco.

Nafin, which grants credits and guarantees to public and private projects, created in 2014 the Energy Impulse Programme for these initiatives, endowed with more than a billion dollars.

It also manages, along with the economy ministry, the Public Trust to Promote the Development of Energy Industry National Suppliers and Contractors, designed for the industrial promotion of local production chains and direct investment in the energy industry, which this year has a fund of some 41 million dollars.

Missing: social and environmental safeguards

As in the case of the Morelos Integral Project, the gas pipelines have been a source of conflict with local communities, arising from the lack of socio-environmental safeguards and standards to guarantee that a project and its financing will respect the human rights of potentially affected communities.

Nafin and Banobras lack such safeguards, while Bacomext has had an “Environmental and Social Risk Management System Guide” since 2017, with no evidence of whether and how it has been applied to energy projects financed since then.

Since 2003, three platforms of international standards have emerged, to which Mexico’s development banks have not adhered, on human rights; social and environmental assessments and impacts; the application of safeguards; stakeholder participation; complaint resolution; and transparency.

The planet needs 80 percent of the global hydrocarbon reserves to stay underground in order for the temperature increase to remain at 1.5 degrees Celsius, as set out in the Paris Agreement on climate change.

The treaty, signed by 196 countries and territories in 2015, will enter into force at year-end and is considered indispensable to avoid irreversible climate disasters and human catastrophes.

Liliana Estrada, a researcher with the Climate Finance Group of Latin America and the Caribbean, told IPS that most investment in energy still goes to fossil fuels.

“After the reform, they have to enter into strategic projects and follow the guidelines of the government; they cannot go against these strategic lines. The gas and gas pipelines became strategic,” with the boost to the megaprojects of the López Obrador administration, said the representative of this coalition of non-governmental organisations and academics.

These credits are part of the fossil fuel subsidies that Mexico has pledged, to several international bodies, to eliminate.

The Mexican energy industry has also attracted international private banks, which have lent 55.95 billion dollars to 12 corporations, according to “Banking on Climate Change: Fossil Fuel Finance Report 2020”, released in March by six international environmental organisations.

The CFE received some 5.4 billion dollars from 12 banks between 2016 and 2019, and Pemex received 48.3 billion dollars from 20 foreign banks.

Based on Huexca’s experience, Castellanos demanded that these investments be stopped.

“If it’s our company, as the government says, then we can close it down. We have to defend the space in which we live, because we only have one planet and it belongs to all of us, it belongs to every living being, and it is our obligation to contribute something to this planet, because we are only here for a short while, we are guests of the earth”, she said.

Estrada called for sustainable financing regulations and questioned the lack of government leadership in this regard.

“Development banks must have safeguards and principles for sustainable investment,” she said. “National regulations are needed, which define climate finance and green finance, what principles govern them, what are the climate risks. The trend should be to increasingly finance green projects and less and less hydrocarbons.”

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Coronavirus Hasn´t Slowed Down Ecological Women Farmers in Peru’s Andes Highlands

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Women & Economy

Quechua indigenous farmers from the town of Huasao, in the Andes highlands of Peru, cut insect repellent plants in front of Juana Gallegos' house, while others prepare the biol mixture, a liquid organic fertiliser that they use on their vegetable crops. CREDIT: Mariela Jara/IPS

Quechua indigenous farmers from the town of Huasao, in the Andes highlands of Peru, cut insect repellent plants in front of Juana Gallegos’ house, while others prepare the biol mixture, a liquid organic fertiliser that they use on their vegetable crops. CREDIT: Mariela Jara/IPS

HUASAO, Peru, May 6 2020 (IPS) – It’s eight o’clock in the morning and Pascuala Ninantay is carrying two large containers of water in her wheelbarrow to prepare with neighbouring women farmers 200 litres of organic fertiliser, which will then be distributed to fertilise their crops, in this town in the Andes highlands of Peru.


“We grow healthy, nutritious food without chemicals,” she tells IPS, describing the sustainable agriculture she practices in Huasao, a town of about 1,500 people in Quispicanchi province, 3,300 metres above sea level, in the department of Cuzco in south-central Peru.

It will take them four hours to prepare the “biol”, a liquid fertiliser composed of natural inputs contributed by the local farmers as part of a collective work tradition of the Quechua indigenous people, to which most of the inhabitants of Huasao and neighbouring highlands villages in the area belong.

“Between all of us we bring the different ingredients, but we were short on water so I went to the spring to fill my ‘galoneras’ (multi-gallon containers),” explains Ninantay.

The women, gathered at the home of Juana Gallegos, work in community. While some gather insect repellent plants like nettles and muña (Minthostachys mollis, an Andes highlands plant), others prepare the huge plastic drum where they will make the mixture that includes ash and fresh cattle dung.

They keep working until the container is filled with 200 litres of the fertiliser which, after two months of fermentation in the sealed drum, will be distributed among them equally.

Making organic fertiliser is one of the agro-ecological practices that Ninantay and 15 of her neighbours have adopted to produce food that is both beneficial to health and adapted to climate change.

They are just a few of the almost 700,000 women who, according to official figures, are engaged in agricultural activities in Peru, and who play a key role in the food security and sovereignty of their communities, despite the fact that they do so under unequal conditions because they have less access to land, water management and credit than men.

That is the view of Elena Villanueva, a sociologist with the Flora Tristán Centre for Peruvian Women, a non-governmental organisation that for the past two years has been promoting women’s rights and technical training among small-scale women farmers in Huasao and six other areas of the region, with support from two institutions in Spain’s Basque Country: the Basque Development Cooperation agency and the non-governmental Mugen Gainetik.

“During this time we have seen how much power the 80 women we have supported have gained as a result of their awareness of their rights and their use of agro-ecological techniques. In a context of marked machismo (sexism), they are gaining recognition for their work, which was previously invisible,” she told IPS.

A group of women farmers are ready to head out to the plots they farm on the community lands outside of Huasao, a rural town in Peru's Andes highlands department of Cuzco. They are wearing masks to prevent the spread of COVID-19, because they depend on their production for food and income from the sale of the surplus, to cover their household expenses. CREDIT: Nayda Quispe/IPS

A group of women farmers are ready to head out to the plots they farm on the community lands outside of Huasao, a rural town in Peru’s Andes highlands department of Cuzco. They are wearing masks to prevent the spread of COVID-19, because they depend on their production for food and income from the sale of the surplus, to cover their household expenses. CREDIT: Nayda Quispe/IPS

This group of women farmers is convinced of the need for nutritious food that does not harm people’s health or nature, and they are happy to do their small part to make that happen.

“We want to have a variety of food constantly available, but taking care of our soil, water, plants, trees and air,” says Ninantay.

“We no longer use chemicals,” says Gallegos. “Thanks to the training we have received, we understood how the soil and our crops had become so dependent on those substances, we thought that only by using them would we have a good yield. But no, with our own fertilisers we grow lettuce, tomatoes, chard, artichokes, radishes and all our big, beautiful, tasty vegetables. Everything is organic.”

Once they were producing their fresh produce using agro-ecological techniques, the women decided to also begin growing their staple crops of potatoes and corn organically. “I see that the plants are happier and the leaves are greener now that I fertilise them naturally,” says Ninantay.

Villanueva says these decisions on what to plant and how to do it contribute to new forms of agricultural production that meet the food needs of the women and their families while also contributing to the sustainable development of their communities.

“With agro-ecology they enrich their knowledge about the resistance of crops to climate change, they carry out integrated management of pests and diseases, and they have tools to improve their production planning,” she explains.

And even more important, “this process raises their self-esteem and strengthens their sense of being productive citizens because they are aware that they are taking care of biodiversity, diversifying their crops and increasing their yields,” she adds.

Thanks to this, these peasant women are obtaining surpluses that they now market.

Three times a week, Ninantay and the other women set up their stall in Huasao’s main square where they sell their products to the local population and to tourists who come in search of local healers, famous for their fortune telling and cures, which draw on traditional rituals and ceremonies.

The agro-ecological women farmers set up their stall three times a week in the main square of the rural municipality of Huasao to sell lettuce, tomatoes, Chinese onions, radish and other fresh produce. They are now marketing their wares in compliance with the health regulations put in place in response to the coronavirus pandemic, for which they have received training from the municipal authorities. CREDIT: Nayda Quispe/IPS

The agro-ecological women farmers set up their stall three times a week in the main square of the rural municipality of Huasao to sell lettuce, tomatoes, Chinese onions, radish and other fresh produce. They are now marketing their wares in compliance with the health regulations put in place in response to the coronavirus pandemic, for which they have received training from the municipal authorities. CREDIT: Nayda Quispe/IPS

Coronavirus alters local dynamics

However, the measures implemented by the central government on Mar. 15 to curb the spread of the COVID-19 pandemic have reduced trade, by not allowing outsiders to visit Huasao, known locally as “the village of the witchdoctors” because of its healers.

But the work in the fields has not stopped; on the contrary, the women are working harder than ever.

“We used to have the income of my husband who worked in the city, but because of the state of emergency he can no longer leave,” says Ninantay. “My fellow women farmers are in the same boat, so we continue to harvest and sell in the square and what we earn goes to buying medicines, masks, bleach and other things for the home.”

Initially, she says, the husbands didn’t want their wives to participate in the project and stay overnight away from home to attend the training workshops. But after they saw the money they were saving on food and the income the women were earning, “they now recognise that our work is important.”

Their husbands, like most Huasao men, do not work in the fields. They work in construction or services in the city of Cuzco, about 20 km away, or migrate seasonally to mining regions in search of a better income.

So the community lands, where each family has usufruct rights on three-hectare plots, were left in the hands of women, even though the title is usually held by the men. With the opportunity offered by the Flora Tristán project, they have increased their harvests and are no longer merely subsistence farmers but earn an income as well.

Despite the pandemic, the women obtained permission from the authorities and received training on the care and prevention measures to be followed in order to market their products under conditions that are safe for them and their customers.

Their stall at the open-air market in the town’s main square is already known for offering healthy food, and on Mondays, Tuesdays and Thursdays they run out of vegetables and other products they offer. They also sell their wares in other fairs and markets.

Their stall in the municipal market is also seen as an alternative to return to more natural foods in the face of the increasing change in eating patterns in rural areas.

“Many people don’t want to eat quinoa or ‘oca’ (Oxalis tuberosa, an Andean tuber), they prefer noodles or rice,” says Ninantay. “Children fill up on sweets and junk food and they are not getting good nutrition, and that’s not right. We have to educate people about healthy eating if we want strong new generations.”

She stresses the importance of people understanding that nature, “Mother Earth”, must be respected.

“We have to recover the wisdom of our ancestors, of our grandmothers, to take care of everything that we need to live,” she warns. “If we do not do this, our grandchildren and their children will not have water to drink, seeds to plant, or food to eat.”

Flora Tristán’s Villanueva announced that the 80 women farmers in the programme would participate in initiatives for the recovery of agricultural and water harvesting practices based on forestation and infiltration ditches, using native trees known as chachacomas (Escallonia resinosa) and queñuas (Polylepis).

The women hope that their experience and knowledge will be extended on a large scale, because although they share with their families, neighbours and relatives what they are learning, they believe that the authorities should help expand these practices.

“We would like not only Huasao, but all of Cuzco to be an agro-ecological region, so that we can help nature and guarantee healthy food for the families of the countryside and the city,” says Gallegos, convinced that if they could do it, everyone can.

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Coronavirus, New Threat for Mexican Migrant Workers in the U.S.

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Migration & Refugees

Considered essential to the U.S. economy, as Donald Trump himself now acknowledges, Mexico's seasonal farmworkers are exposed to the coronavirus pandemic as they work in U.S. fields, which exacerbates violations of their rights, such as wage theft, fraud, and other abuses. CREDIT: Courtesy of MHP Salud

Considered essential to the U.S. economy, as Donald Trump himself now acknowledges, Mexico’s seasonal farmworkers are exposed to the coronavirus pandemic as they work in U.S. fields, which exacerbates violations of their rights, such as wage theft, fraud, and other abuses. CREDIT: Courtesy of MHP Salud

MEXICO CITY, Apr 21 2020 (IPS) – As the high season for agricultural labour in the United States approaches, tens of thousands of migrant workers from Mexico are getting ready to head to the fields in their northern neighbour to carry out the work that ensures that food makes it to people’s tables.


But the SARS-CoV-2 (COVID-19) pandemic, of which the U.S. has become the world’s largest source of infection, threatens to worsen the already precarious conditions in which these workers plant, harvest, process and move fruits and vegetables in the U.S.

Exposed to illegal charges for visa, transport and accommodation costs, labour exploitation, lack of access to basic services and unhealthy housing, Mexican seasonal workers driven from their homes by poverty must also now brave the risk of contagion.

Evy Peña, director of communications and development at the non-governmental Centro de los Derechos del Migrante (Migrant Rights Centre – CDM), told IPS from the city of Monterrey that the COVID-19 pandemic is exacerbating violations of the rights of migrant workers.

“Temporary visa programmes are rife with abuse, from the moment workers are recruited in their communities. They suffer fraud, they are offered jobs that don’t even exist in the United States. It’s a perverse system in which recruiters and employers have all the control. There are systemic flaws that will become more evident now,” the activist said.

In 1943, the United States created H2 visas for unskilled foreign workers, and in the 1980s it established H-2A categories for farm workers and H-2B categories for other work, such as landscaping, construction and hotel staff.

In 2019, Washington, which had already declared them “essential” to the economy, granted 191,171 H-2A and 73,557 H-2B visas to Mexican workers, and by January and February of this year had issued 27, 058 and 6,238, respectively.

Two emergencies converge

Now, the two countries are negotiating to send thousands of farmworkers within or outside of the H2 programme, starting this month, to ensure this year’s harvest in the U.S. The Mexican government has polled experts to determine the viability of the plan, IPS learned.

The migrant workers would come from Michoacan, Oaxaca, Zacatecas and the border states. The plan would put leftist President Andres Manuel López Obrador in good standing with his right-wing counterpart, Donald Trump; generate employment for rural workers in the midst of an economic crisis; and boost remittances to rural areas.

For his part, Trump, forced by a greater need for rural workers in the face of the pandemic and under pressure from agriculture, abandoned his anti-immigrant policy and on Apr. 1 even issued a call for the arrival of Mexican migrant workers.

“We want them to come in,” he said. “They’ve been there for years and years, and I’ve given the commitment to the farmers: They’re going to continue to come.”

U.S. authorities can extend H-2A visas for up to one year and the maximum period of stay is three years. After that, the holder must remain outside U.S. territory for at least three months to qualify for re-entry with the same permit.

On Apr. 15, Washington announced temporary changes allowing workers to switch employers and to stay longer than three years.

A Mexican migrant worker works at a vineyard in California, one of the U.S. states most dependent on seasonal labour from Mexico in agriculture, and which has now urged President Donald Trump to facilitate the arrival of guest workers from that country so crops are not lost. CREDIT: Kau Sirenio/En el Camino

A Mexican migrant worker works at a vineyard in California, one of the U.S. states most dependent on seasonal labour from Mexico in agriculture, and which has now urged President Donald Trump to facilitate the arrival of guest workers from that country so crops are not lost. CREDIT: Kau Sirenio/En el Camino

The most numerous jobs are in fruit harvesting, general agricultural work such as planting and harvesting, and on tobacco plantations, according to the U.S. Department of Labor.

Migrant workers traditionally come from Mexican agricultural and border states and their main destinations are agricultural areas where there is a temporary or permanent shortage of labourers.

Jeremy McLean, policy and advocacy manager for the New York-based non-governmental organisation Justice in Motion, expressed concern about the conditions in which migrants work.

The way the system works, “it’s not going to be easy to follow recommendations for social distancing. Hundreds of thousands of people are going to come and won’t be able to follow these recommendations, and they will put themselves at risk. It could spell another wave of infection and transmission,” he warned IPS.

“This population group has no health services and no medical insurance. If they fall ill in a remote area, what help can they get?” he said from New York.

On Mar. 26, the U.S. Embassy in Mexico reported that it would process without a personal interview the applications of those whose visas had expired in the previous two years or who had not received them in that time, under pressure from U.S. agribusiness.

Trapped with no way out

The migrant workers’ odyssey begins in Mexico, where they are recruited by individual contractors – workers or former workers of a U.S. employer, fellow workers, relatives or friends, in their hometowns – or by private U.S. agencies.

Although article 28 of Mexico’s Federal Labour Law, in force since 1970 and overhauled in 2019, regulates the provision of services by workers hired within Mexico for work abroad, it is not enforced.

It requires that contracts be registered with the labour authorities and that a bond be deposited to guarantee compliance. It also holds the foreign contractor responsible for the costs of transport, repatriation, food for the worker and immigration, as well as the payment of full wages, compensation for occupational hazards and access to adequate housing.

In addition, it states that Mexican workers are entitled to social security benefits for foreigners in the country where they are offering their services.

Although the Mexican government could enforce article 28 of the law in order to safeguard the rights of migrant workers who enter and leave the United States under the visa programme, it has failed to do so.

In its recent report “Ripe for Reform: Abuse of Agricultural Workers in the H-2A Visa Program”, the bi-national CDM organisation reveals that migrant workers experience wage theft, health and safety violations, discrimination, and harassment as part of a human trafficking system.

Recruitment without oversight

For Mayela Blanco, a researcher at the non-governmental Centre for Studies in International Cooperation and Public Management, the problem is the lack of monitoring or inspections of recruiters and agencies.

“In Mexico there are still many gaps in the mechanisms for monitoring and inspecting recruitment. There is still fraud,” she told IPS. “How often do they inspect? How do they guarantee that things are working the way they’re supposed to?”

There are 433 registered placement agencies in the country, distributed in different states, according to data from the National Employment Service. For the transfer of labour abroad, there are nine – a small number considering the tens of thousands of visas issued in 2019.

For its part, the U.S. Department of Labor reports 239 licenced recruiters in that nation working for a handful of U.S. companies.

Data obtained by IPS indicates that Mexico’s Ministry of Labour only conducted 91 inspections in nine states from 2009 to 2019 and imposed 12 fines for a total of around 153,000 dollars. Some states with high levels of migrant workers were never visited by inspectors.

Furthermore, the records of the federal labour board do not contain any reports of violations of article 28.

Mexico is a party to the Fee-Charging Employment Agencies Convention 96 of the International Labour Organisation (ILO), which it violates due to non-compliance with the rights of temporary workers.

Peña stressed that there is still a gap between the U.S. and Mexico in labour protection and said workers are being left behind because of that gap.

“Countries like Mexico see temporary visas as a solution to labour migration and allow the exploitation of their citizens. The H2 programme is about labour migration and governments forget that bilateral solutions are needed,” she said.

In response to the pandemic and its risks, 37 organisations called on the U.S. government on Mar. 25 for adequate housing with quarantine facilities, safe transportation, testing for workers before they arrive in the United States, physical distancing on farms and paid treatment for those infected with COVID-19.

Blanco emphasised the lack of justice and reparation mechanisms. “The more visas issued, the greater the need for oversight. Mexico is perceived as a country of return or transit of migrants, but it should be recognised as a place of origin of temporary workers. And that is why it must comply with international labour laws,” she said.

McLean raised the need for a new U.S. law to guarantee the rights of migrant workers, who are essential to the economy, as underscored by the demand reinforced by the impact of COVID-19.

“We pushed for a law to cover all temporary visa programmes so that there would be more information, to avoid fraud and wage theft. But it is very difficult to get a commitment to immigration dialogue in the United States today,” he said.

But the ordeal that migrant workers face will not end with their work in the U.S. fields, because in October they will have to return to their hometowns, which will be even more impoverished due to the consequences of the health crisis, and with COVID-19 in all likelihood still posing a threat.

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Young People Bring Solar Energy to Schools in the Argentine Capital

Civil Society, Development & Aid, Editors’ Choice, Education, Energy, Environment, Featured, Headlines, Integration and Development Brazilian-style, Latin America & the Caribbean, Population, Projects, Regional Categories, Special Report, TerraViva United Nations

Energy

Sebastián Ieraci (L), a member of the group of students who in 2014 pushed for the switch to solar energy at the Antonio Devoto High School, stands next to the school's principal Marcelo Mazzeo on the rooftop of the educational institution located in the Buenos Aires neighbourhood of Villa Devoto. Credit: Daniel Gutman/IPS

Sebastián Ieraci (L), a member of the group of students who in 2014 pushed for the switch to solar energy at the Antonio Devoto High School, stands next to the school’s principal Marcelo Mazzeo on the rooftop of the educational institution located in the Buenos Aires neighbourhood of Villa Devoto. Credit: Daniel Gutman/IPS

BUENOS AIRES , Mar 19 2020 (IPS) – “The idea came to a group of schoolmates and me in 2014, but we never thought it could become a reality,” says Sebastián Ieraci, 23, as he points to a multitude of photovoltaic solar panels shining on the roof of the Antonio Devoto High School in the Argentine capital.


The secondary school is one of the first public centres in Buenos Aires that has managed, since last November, to cover 100 percent of its electricity needs from renewable energy generated in the building itself.

Although today only seven of the city’s public schools have solar panels, the authorities have identified another 140 school buildings with the conditions to generate solar energy, and the plan is to gradually equip all of them with solar panels.

But perhaps the most interesting aspect of this case is that it was the students’ own enthusiasm for clean energy and community involvement that allowed the school to be chosen for an experiment that is new to Buenos Aires.

“Now they come to see us from schools in different parts of the country, to see what we have done and to try to replicate it.” — Marcelo Mazzeo

Ieraci, who arrives in a hurry at his former school after his workday at a paint factory, was in his last year of high school in 2014, when law teachers suggested to him and his classmates that they come up with a project for the programme The Legislature and Schools.

The programme, carried out for over 20 years, invites final-year high school students to submit proposals to the Buenos Aires city legislature, in the areas of environment, public spaces, traffic and transport and security.

Once they do so, the students sit on the city legislature for an afternoon to discuss their proposals with students from other schools.

“We came up with the idea of installing solar panels because we knew that the school’s rooftop was not being used for anything and that doing so could be doubly beneficial, both environmentally and economically, since the school could generate its own energy,” says Ieraci during IPS’s visit to his former school.

Aerial view of the rooftops of the primary and secondary schools located across from the main square in Villa Devoto, a residential neighborhood in the Argentine capital. The adjacent schools now have 200 solar panels with an installed capacity of 70 kilowatts, and the surplus is injected into the Buenos Aires electricity grid. Credit: Courtesy of Buenos Aires city government

Aerial view of the rooftops of the primary and secondary schools located across from the main square in Villa Devoto, a residential neighborhood in the Argentine capital. The adjacent schools now have 200 solar panels with an installed capacity of 70 kilowatts, and the surplus is injected into the Buenos Aires electricity grid. Credit: Courtesy of Buenos Aires city government

“Then we started looking for information, and after a month we presented the project. Back then it was a utopia and today seeing these panels makes me very proud, because this is a school that generates a sense of belonging,” he explains.

The school is located in a large two-storey building that preserves the style of the old manor house that Italian immigrant Antonio Devoto had built there at the beginning of the 20th century. Devoto is considered the founder of the middle-class residential neighbourhood that today bears his name.

The school is located across from the main square of Devoto, in an area with many old trees and few tall buildings, full of bars and restaurants, and bursting with vitality far from the centre of Buenos Aires.

The Devoto teenagers’ solar panel project was the winner among more than 70 initiatives that students presented in 2014 to the local legislature, and in 2016 the Buenos Aires city government launched it. The first step was to start feasibility studies in more than 600 school buildings.

But it was in 2017 that the school received the definitive push to move towards solar energy, when it once again presented the project in a competition, this time in BA Elige (Buenos Aires Chooses), a citizen participation programme in which the more than three million inhabitants of Buenos Aires proper vote on the projects they want to see carried out.

On that occasion, the residents of Devoto expressed their opinions online, supporting the installation of solar panels in the neighbourhood schools and thus enabling the authorities to allocate budget funds.

The installation of the solar panels began in August 2019 and took three months. Since November, 87 two-by-one meter solar panels have been in operation on the rooftop of the Antonio Devoto High School.

The primary school next door was soon incorporated into the programme, and since January 113 solar panels have been operating, bringing the total to 200 panels on the adjacent rooftops of the two schools that serve a combined total of 500 students.

Solar panels nearly cover the entire rooftop of the Antonio Devoto High School in Buenos Aires. Until last year the rooftop area was not put to any use. The idea of using that space to generate renewable energy came from students in their final year in 2014, who presented a project to the Buenos Aires city legislature. Credit: Daniel Gutman/IPS

Solar panels nearly cover the entire rooftop of the Antonio Devoto High School in Buenos Aires. Until last year the rooftop area was not put to any use. The idea of using that space to generate renewable energy came from students in their final year in 2014, who presented a project to the Buenos Aires city legislature. Credit: Daniel Gutman/IPS

“In secondary schools, the panels have 30 kilowatts (kW) of installed capacity, and in primary schools, 40. But the most interesting thing is that the primary school injects its surplus energy into the city’s electricity grid, generating credit with the power company,” engineer Andrés Valdivia, head of climate action in the city government’s Ministry of Education, told IPS.

The Ministry reports that the 140 school rooftops declared suitable for the installation of solar panels – because there are few high buildings surrounding them and they receive good solar radiation – have a combined surface area of 145,000 square meters and could have a total installed capacity of 13 megawatts (MW).

Renewable energies – basically, solar and wind – have experienced major growth in Argentina since a fund was created by law in September 2015 to finance the construction of facilities and to guarantee the purchase of the energy generated.

By late 2019, nearly eight percent of the electricity produced in the country came from renewable sources, up from just 2.2 percent in early 2016, according to official statistics.

However, that growth will not continue because the recession and the devaluation of the local currency in Argentina mean that almost no new projects will be launched, say industry analysts.

View of the front of the Antonio Devoto High School, which was built in an old manor house belonging to the Italian immigrant recognised as the founder of the Villa Devoto neighbourhood in Buenos Aires, the capital of Argentina. Credit: Courtesy of Marcelo Mazzeo

View of the front of the Antonio Devoto High School, which was built in an old manor house belonging to the Italian immigrant recognised as the founder of the Villa Devoto neighbourhood in Buenos Aires, the capital of Argentina. Credit: Courtesy of Marcelo Mazzeo

“Ours is not a technical school; we have an orientation in economics and administration. But the kids’ interest in the energy transition surprised us and led us to gather a lot of information together about the subject,” said Marcelo Mazzeo, the principal of the Antonio Devoto High School.

“Now they come to see us from schools in different parts of the country, to see what we have done and to try to replicate it,” he told IPS.

Félix Aban, one of the law teachers who worked with the students on the project and is now the school’s vice-principal, said that “one of the most interesting things was that in 2014 the kids suggested that the surplus energy generated by their schools could be injected into the power grid, when that possibility was not even being discussed in Argentina.”

In fact, the law on distributed (or decentralised) energy was not approved by Congress until 2017, under the official name “Regime to foment distributed renewable energy generation integrated into the public electricity grid”.

“They investigated and found that in other countries individual generators fed power into the grid. So we can say that the kids at this school were really ahead of the game,” said Aban.

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Could the Coronavirus Pandemic have been Avoided if the World Listened to Indigenous Leaders?

Active Citizens, Climate Change, Editors’ Choice, Environment, Featured, Global, Headlines, IPS UN: Inside the Glasshouse, Regional Categories, TerraViva United Nations

Climate Change

William Clark Enoch of Queensland. Aboriginal and Torres Strait Islander people, who comprise only 2.5 percent of Australia’s nearly 24 million population, are part of the oldest continuing culture in the world. At a Covering Climate Now panel in New York on Friday, indigenous leaders reiterated the need for the world to listen to them in addressing climate concerns. Credit: Neena Bhandari/IPS

UNITED NATIONS, Mar 19 2020 (IPS) Mina Setra remembers the story clearly. As a Dayak Pompakng indigenous person from Indonesia, when  visitors from the city who came into her community; brought bottled water with them because they were worried about the water not being suitable for drinking. 

Setra, who is the deputy secretary-general of the Indigenous Peoples’ Alliance of the Archipelago (AMAN), recalls one of the elders telling the visitors, “This is the problem of you city people: You eat and drink all the dead things. Like the water that is already in a bottle? It is dead water. The vegetables that you buy from the freezer in the supermarket, they’re all dead plants.”

The anecdote sums up a much bigger conversation that is relevant today: how climate change is linked to coronavirus, and why it’s important to listen to indigenous leaders on the matter.

Setra shared the story with IPS when asked about links between climate change and coronavirus, during a panel talk by Covering Climate Now in New York on Friday, where indigenous leaders reiterated the need for the world to listen to them in addressing climate concerns — and reminding them how climate change can lead to or exacerbate a global health crisis as grave as the current virus. 

The talk took place as global communities scrambled to take effective measures against the deadly virus, and just as the U.S. announced a global emergency while struggling to contain its coronavirus cases. More than two months since the world became aware of coronavirus — and increasingly learned of its alarming implicants — the pandemic has globally claimed 8,810 lives, with more than 218,800, cases. 

While global conversations have mainly focused on the issue of death rate, or the racism attached to the virus, or different countries’ isolation methods (or lack thereof), little has been said about the link to climate change.

This remains a much bigger conversation that indigenous leaders want people to be aware of: how climate change can exacerbate the dangers of something like the coronavirus, and why the world should’ve been listening to indigenous leaders to avoid such a catastrophic spread.  While many believe that coronavirus started with a bat, experts argue it’s not so black and white. A February report established what the leaders discussed at the talk: how deforestation can lead to a loss of habitat for many wild animals and species. As a result, they move to habitat that brings them to closer proximity to humans which can lead to repeated contact between them.  

“The inequilibrium of our planet is not just about climate change, but it’s also about the global economy,” Levi Sucre Romero, a member of the BriBri indigenous community from Costa Rica, told IPS at the panel talk. “So coronavirus is now telling the world what we have been saying for thousands of years: that if we do not help protect biodiversity and nature, that we will face this and worse future threats.”

Romero, a coordinator of the Mesoamerican Alliance of Peoples and Forests, further highlighted a United Nations’ statement for why it’s important for global communities to work with indigenous leaders and learn from their knowledge. United Nations for Indigenous Peoples did not respond to the IPS’ request for comments. 

While wild animals and species are forced to find a home in close proximity to humans as a result of deforestation, another crucial concern is the treatment of animals by people from commercial hubs and cities that can act as a catalyst for such a global crisis.

“Our animals are not contaminated by themselves. They get contaminated by people,” Tuxá said in response to IPS’ question about the link between coronavirus and climate change. “And the proof is that these viruses start in the commercial centres of the world. There is a direct correlation between this and coronavirus and other pandemics that are to come.”

Tuxá added the next pandemic’s cure can be found in the diversity of indigenous peoples’ lands. 

“That’s why it’s really important to demarcate and recognise our lands, to protect our lands and our biodiversity because future life depends on it,” he said.

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