#3: Falling in Love with Foz do Iguacu, Al Qaeda in the South American Jungle & Other Crazy Tales
JapanTown, Sao Paulo.
8 Jan 2002
After a nice, relaxed stay in sunny but humid Rio – where I tried my best to forget the English weather and survived the legendary crime rates – I hopped across southern Brazil to Sao Paulo, South America's largest city and one of the world's largest. There I had an interesting walk across Liberdade, the Japan Town of Brazil – spiritual heart of the nation's 1 million Japanese. There I had an interesting conversation with a local Chinese about the 200,000 Chinese in Brazil.
And then a 1000km, 14-hour journey over to Foz do Iguacu on the border of Brazil, Argentina and Paraguay. This is the southwest of Brazil, land of the gauchos, or cowboys. The inhabitants of this land are descendants of German and Austrian farmers. Almost entirely white, apart from some Japanese who also settled in this land of fertile red soil to run farms, plus Arabs who run the local retail trade.
The latter came into international attention recently when Brazilian authorities arrested 55 members of the Al Qaeda here. This border region has always been porous, and the free-trade regime adopted by the three countries here has allowed all sorts of less-than-legal things to go on. On top of these are the Chinese and Koreans as well, who compete with the Arabs. The net result is an amazing cosmopolitan tri-national piece of territory in the middle of the South American jungle, far away from the oceans where one would normally expect such a cosmopolitan mix. Few! Other places in South America have as many Arab, Chinese, Japanese and Korean restaurants.
Iguacu Falls.
Foz do Iguacu itself has always attracted tourists – this is the site of the famous Iguacu Falls. The Rio Iguacu, receiving water from more than 30 rivers, falls over a 60m-cliffside more than 4km-wide here, creating one of the most magnificent natural wonders of the world. Niagara Falls is no match at all, so much so that Eleanor Roosevelt remarked "Poor Niagara" on seeing the Iguacu Falls.
Together with a crazy bunch of people I met at the pension (run by a friendly lady of Bulgarian origin and exaggerated hand movements) – two Swedes (who between themselves had been to Central Asia, Russia, Abkhazia and many parts of Africa) and an Israeli army officer who had just completed his national service, I explored the Brazilian side of the Falls. An unbelievably amazing sight, so much so that I almost thought that the Argentine side was no big deal. I was wrong – it was the Argentine site that brought one into the very power and magnificence of the wonder, and that was something we discovered the following day on a day trip across the border.
The Falls aside, the Argentine side of the national park is an interesting insight into the trouble Argentina is facing today. Despite the announcement by the provisional Argentine president that the peso would be devalued, and that the money market has already treated the peso as 30% to 40% less than the official value, the park authorities continue to treat the peso as equal to the dollar. Any change to payments in the dollar is made in peso on a 1:1 basis. And the prices of everything on sale this side of the border is several times that of the Brazilian side.
I remembered how expensive things were when I last visited Argentina in 2000; a simple meal can be more expensive than one in Europe, where the GDP per capita is nowhere as near. The country hedges itself to the dollar when it operates in a different economic tier; no wonder Argentina cannot compete in the international markets. Its government continues to borrow aggressively (and greedy bankers continue to lend them money, building up a pyramid of dreams). Even at this stage, the ridiculous system is being sustained at this remote national park – of course, they are well aware of the price inelasticity of tourists like us...
Both Brazil and Argentina, with their large populations and enormous mineral and agricultural resources as well as industrial output capability, have always been seen as countries with limitless potential. Both, however, have also failed all predictions repeatedly, and go through drastic cycles of bust and boom. Brazil has held out well for the moment. It will be interesting to see whether it is able to continue to implement policies to remain competitive using its managed float exchange rate system, as well as transforming itself from a commodity-based economy into a world-class industrial power. Perhaps the old predictions of progress and development will come true after all.
And so with the Falls done, I am leaving Brazil and preparing myself for Paraguay, my first country in Spanish America on this trip. Brazil is a wonderful country. Pity I am only spending a week here, especially given that it is half of South America in surface area and population. That, however, leaves an excuse to return sometime in the future. Already on the agenda for my future trip to Brazil are Manaus, Northeast, Salvador-Bahia and Brasilia.
OK, next you will hear from me in Paraguay.