Latin America: Between neoliberal extractivism and resource nationalism

June 12, 2022
The book allows readers to clearly distinguish between the resource nationalism of Pink Tide governments and the extractivist policies of neoliberal states.

Latin American Extractivism: Dependency, Resource Nationalism, and Resistance in Broad Perspectives
Edited by Steve Ellner.
Rowman and Littlefield, 2021.

Latin American Extractivism is a compilation of articles analysing the political economy of resource nationalism and policies of natural resource extraction by left and right-wing governments, with Venezuela-based academic Steve Ellner serving as editor.

It is a well-timed response to the chorus of “neo-extractivist” academics who, for more than a decade, have criticised “Pink Tide” governments across Latin America for allegedly being “rentier states” that continued down the road of their neoliberal predecessors and embraced a socio-economic model that sought industrialisation and economic development over preservation of the environment. 

Ellner’s introduction to the book provides a balanced vision of the topic of neo-extractivism, recognising the limitations of the policies of resources nationalism across the various Pink Tide governments, while acknowledging the dire socio-economic circumstances these governments operated in. It does not shy away from disputing the barrage of criticism directed at these governments by neo-extractivist academics, pointing to their limitations in assessing the economic outcomes of governments of Rafael Correa (Ecuador), Evo Morales (Bolivia), Cristina Fernández de Kirchner (Argentina) and others.

The next three parts of the book provide a sober analysis of the global focus of extractivist policies, as well as a stark comparison between left-wing and right-wing governments in terms of the political economies of resource extraction and subsequent allocation of generated funds.  

Ellner writes: “The resource nationalist policies promoted by Pink Tide governments contrast with those of more conservative ones. Most important, the overriding importance of resource nationalism should not be clouded by the thesis that there was consensus about extractivism’s potential to favour national interests.” 

The other authors follow a similar line of thought.

In the first part, Kyla Sankey provides a clear example of neoliberal extractivism, looking at how Colombia has been effectively transformed into a branch of the transnational corporations, providing ample opportunity for foreign capital to exploit the nation’s fossil fuels and other natural resources. This is contrasted strongly with a balanced analysis of the impact of the natural resources boom in Bolivia and the various institutional and political changes that it produced, as outlined by Alfredo Macías Vásquez and Jorge García-Arias.

The authors recognise that the Morales administration effectively broke with the neoliberal past with regards to the nationalisation of various natural resources industries and the distribution of funds towards public investment and social programs. They also recognise the shortcomings of this economic model, due to both internal and external factors, as evidenced by the difficulties in sustainability experienced during the 2015–19 period.

Finally, Emma Miriam Yin-Hang To’s piece tackles the perceived dilemma of countries such as Venezuela with regards to maintaining favourable trade and investment balances with the People’s Republic of China, while at the same time avoiding the trap of dependency.

Utilising a balanced approach, she recognises the Asian economic giant’s relationship with the Bolivarian republic as that of both cooperation and dependency, as evidenced by key infrastructure projects and technology transfers implemented by the former and the continuous dependency on the oil contracts and petroleum exports by the latter. 

The second part of the book provides a deeper analysis of the individual experiences of nationalisation, environment conservation, respect for indigenous rights, resource redistribution and attempts at systematic changes of the productive models among the various Pink Tide governments.

Luis Angosto-Ferrández's chapter is dedicated to explaining the enduring popularity of the various left-wing political movements that effectively embraced resource nationalism and implemented economic policies that left a lasting impact, while at the same time criticising neo-extractivist academics for ignoring the true origin of environmental destruction (transnational capital) and focusing their criticism squarely on the actions of the Pink Tide.

Angosto-Ferrández provides a further example, often overlooked by the neo-extractivist academia, of a mining community of the indigenous Pemon people in Venezuela’s Gran Sabana and their own balance between resource extraction and the environmental impact.

Maria J Paz and Juan Ramírez-Cendrero go into a more detailed analysis of the first National Development Plan following Morales’ victory, putting a particular emphasis on the way in which the Bolivian state took over one of the country’s key means of production, but also pointing out key shortcomings of that first experience, namely fiscal and financial imbalance and a lack of industrialisation in the gas sector.

Darcy Tetreault’s chapter on Mexico’s state petroleum and oil sector follows a similar pattern, praising the anti-corruption measures undertaken by Andrés Manuel López Obrador’s (AMLO) government, alongside the strengthening of the state planning element and forging of a new relationship with the organised workers in the industry. At the same time, it points out AMLO’s shortcomings, including the continuation of some neoliberal-era practices such as fracking, and a lack of any serious tax reform. 

Among the chapters that stand out the most in this section is Teresa Velásquez’ analysis of Correa’s relationship with the indigenous movement, particularly with regards to the water laws and state control of utilities, as well as a stark contrast between Correa’s approach towards resource nationalism and the crude extractivism practised by his neoliberal successor, Lenín Moreno.

Finally, Amalia Leguizamón deconstructs the primary reasons for the endurance of “soybean hegemony” across Argentina’s political spectrum and the way this has been utilised by former left Peronist President Cristina Kirchner in the implementation of a new export tax policy and the windfall revenue it produced.

The book’s final section allows the reader to clearly distinguish between the political economy of resource nationalism and redistribution of the Pink Tide governments and the extractivist policies of the neoliberal states across Latin America.

Kicking off the section is a comparative study of two Central American countries — El Salvador and Honduras — and their respective government administrations. The Pink Tide-aligned Farabundo Martí National Liberation Front government of El Salvador clearly distinguished itself from its neoliberal neighbour by implementing anti-extractivist policies banning mining and ensured public control over the water supply, even in the face of a major lawsuit by various Canadian transnational corporations.

The Honduran state, long dominated by various strands of neoliberalism (except for the administration of Manuel Zelaya), became a reliable platform for both the country’s business elites that had major investments in mining and other extractivist activities, as well as the foreign governments (such as Canada) that defended the interests of transnational corporations. 

This is followed up by another comparative study by Zaraí Toledo Orozco, focusing on the differences in state policy towards artisanal gold mining between the conservative administrations in Peru and Colombia, and the Morales government in Bolivia.

In the case of the former, the governments largely prioritised the interests of large-scale mining corporations to fulfil their obligations to both domestic and international extractivist capital, at the same time ignoring the demands of various social forces and resorting to repression.

Morales’ approach in Bolivia contrasted strongly, as the new Plurinational State and constitution created a balance of political forces that favoured cooperation rather than the coercion of social forces, and at the same time encouraged the integration of the miners into the policy-making process.

The concluding chapter, written by Castriela Esther Hernández Reyes, dissects the connection between the extractivist policies of neoliberal governments in Colombia and the racial inequality that it exacerbates among Black women, as well as the importance of Black decolonisation and feminism in the process of fighting against extractivism and capitalism. 

Latin American Extractivism creates somewhat of a perfect balance between the achievements of the Pink Tide governments in the use of nationalised natural resources and the policies of resource nationalism, including the contradictions and shortcomings of these processes, and the conservative extractivist policies and state coercion exercised by the neoliberal governments of the region.

The book serves as a strong answer to both the pessimistic approach of the neo-extractivism crowd and its unbalanced criticism of the new left-wing governments around Latin America, as well as those who completely embrace the Pink Tide with no acknowledgment of the contradictions and the mistakes it has committed. 

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