Latin CEO: Executive Strategies for the Americas articles from March 2002

Latin CEO: Executive Strategies for the Americas archives from March 2002

Silver lining. (Letter from the Editor).
March 1, 2002... IN LOOKING OVER THE various stories which we are publishing this month, it does seem that there is a kind of silver lining to current events in Latin America. The biggest positive of all is the simple fact that Brazil is doing well, even...

Back in the fray. (Upfront: Argentina).
March 1, 2002... The Inter-American Development Bank (IDB) became the first major lender to return to Argentina with a US$694 million set of loans to the government. The loans are for "social safety net" structures such as school incentives, infrastructure in...

Bank bailout no. 1. (Upfront: Argentina).
March 1, 2002... The country's largest private bank hopes to ride out the current economic crisis with a bailout plan. Locally owned Banco Galicia will sell US$400 million of its mortgage portfolio to 18 banks with Argentine operations. The government will...

ING insuring Brazil. (Upfront: Brazil).
March 1, 2002... Dutch ING Groep NV has further expanded in Latin America with the purchase of 49 percent of Sul America Cia. Nacional de Seguros, Brazil's No. 2 insurance company ING paid US$160 million in cash and will fold its US$240 million in Brazilian...

Beers in bed. (Upfront: Brazil).
March 1, 2002... Consolidation continues in Brazil's fast-growing beer market. Molson Inc. of Canada has purchased No. 2 brewer Cervejarias Kaiser SA for US$765 million, from a group of investors that included Coca-Cola Co. and bottler Panamerican Beverages....

Government exits CVRD. (Upfront: Brazil).
March 1, 2002... The government raised US$1.6 billion selling the 18-percent of Companhia Vale do Rio Doce's shares that it owned. The sale took place the same day that the massive mining corporation began issuing ADRs on the New York Stock Exchange.

Bigger bank. (Upfront: Brazil).
March 1, 2002... Banco Bradesco SA, the country's largest private bank, has been on an acquisition spree this year. Purchases have included Banco Cidade and its attractive wealthy client base for US$151 million; 89 percent of Banco do Estado do Amazonas SA...

Sweet Chocolate. (Upfront: Brazil).
March 1, 2002... Chocolate maker Nestle AG of Switzerland has agreed to urchase Garoto SA, for an undisclosed purchased price that is rumored to be 565.8 million reals (US$247 million). Antitrust agency CADE has not yet approved the transaction, but will...

Wireless venture revived. (Upfront: Brazil).
March 1, 2002... A private investor has purchased a 7-percent stake in wireless company Telecom Americas Ltd. for US$300 million. Joint venture partners Bell Canada International America Movil and SBC Communications will see their stakes fall to 39 percent,...

Making cement. (Upfront: Dominican Republic).
March 1, 2002... Colombia's Grupo Andino has begun construction of a US$225 million cement complex in the southwestern port of Pedernales. The plant will be at the newly created Cabo Rojo industrial mineral park, which enjoys tax breaks and has top-notch...

Investment grade actions. (Upfront: Mexico).
March 1, 2002... Grupo Televisa has taken advantage of Mexico's Standard & Poor's investment-grade rating (the country now has investment-grade ratings from all three major agencies) to issue US$300 million in bonds. The bonds' 30-year maturity is the longest...

No so sweet. (Upfront: Mexico).
March 1, 2002... The government avoided disputes with soft-drink distributors and US corn syrup producers by dropping its 20-percent tax on non-sugar-sweetened carbonated drinks. The tax was seen as a sweetener for the country's sugar industry.

Telephony consolidation. (Upfront: Mexico).
March 1, 2002... Telefonica Moviles has purchased 65 percent of mobile operator Pegaso for US$70.5 million, plus the assumption of Pegaso debt. TM said it would spend around US$950 million total for the acquisition and integration of Pegaso into its existing...

Baked bread. (Upfront: Mexico).
March 1, 2002... Being the largest baker in 11 countries in Latin America was not enough for Grupo Bimbo The company has purchased the US assets of George Weston Bakeries (based in Canada) for US$160 million. The purchase gives Biaabo bakeries, production...

Electricity float. (Upfront: Peru).
March 1, 2002... The government continued its privatization of electricity distributor Edelnor when privatization agency COPRI sold 9.36 percent of the company on Lima's stock exchange for US$24 million. Enersis of Chile (owned by Spain's Endesa) controls...

PDVSA president out after Chavez disagreement. (Upfront: Venezuela).
March 1, 2002... President President Hugo Chavez has ousted Petroleos de Venezuela SA (PDVSA) president General Guaicaipuro Lameda. Lameda, a longtime Chavezally, had criticized new laws that raised Venezuela's oil royalty payments as high as 30 percent and...

AES gets out. (Upfront: Venezuela).
March 1, 2002... Five months after withdrawing its takeover bid for Compania Anonima Nacional Telefonos de Venezuela (CanTV), US-based AES Corp. (through its Venezuelan unit, Corporacion Electricidad de Caracas) has sold its stake in the telecom company for...

Trade recognition. (Upfront: Regional).
March 1, 2002... The Association of Bi-National Chambers of Commerce has named Inter-American Development Bank president Enrique Iglesias winner of this year's Award for Leadership in Global Trade. Past winners have included former Nicaraguan president...

Exports of Goods in 2001. (Index).
March 1, 2002... Exports of goods in 2001 Export Growth in 2001 (%) Latin America's total exports fell 3 percent in 2001. The largest decline came within the Americas, where exports dropped nearly 4 percent. Exports to the rest of the world...

Stability: country risk ratings 2001-2002. (Index).
March 1, 2002... A country's stability--how well it avoids and/or withstands political, social and economic crises--is a vital measure of attractiveness for investors. The Lehman Brothers Eurasia Group has integrated risk assessment of such areas as...

Educated increase. (Bulletin Board).
March 1, 2002... * Latin American students in higher education 2000: 9.5 million * Higher education students in 1970: 1.6 million * Increase in two decades: 500 percent Source: Inter-American Development Bank

Explosive oil. (Bulletin Board).
March 1, 2002... * Bombings of Colombia's major oil pipeline, the Cano Limon Field, in 2001:170 * Average daily oil production in Colombia in 2001: 603,681 barrels * Average daily production in 2000: 686,001 barrels * Drop in production: 12% ...

Brazil's surprise trade surplus. (Bulletin Board).
March 1, 2002... * Brazil's total exports in 2001: US$58.22 billion * Brazil's total exports in 2000: US$55.09 billion * Brazil's 2001 trade balance: US$2.64 billion surplus * Last time Brazil registered a surplus: 1994 (US$ 0.47 billion surplus)...

Still driving. (Bulletin Board).
March 1, 2002... * Total vehicles produced in Brazil in 2001:1.79 million * Total vehicles produced in 2000:1.68 million * Increase in output: 6.3% * Total vehicles sold domestically in Brazil in 2001:1.59 million * Total vehicles sold...

Unfunded government. (Bulletin Board).
March 1, 2002... * Drop in Argentine tax receipts in January 2001, from January 2000:12% * Drop in Argentine tax receipts in February 2001, from February 2000: 24% * Total taxes collected in February 2001: US$ 1.5 billion Source: Argentine...

In the dollar we trust. (Bulletin Board).
March 1, 2002... * US dollars in Argentina: US$700 per capita * US dollars in Brazil: US$6 per capita * Total US dollars in Argentina: US$25 billion Source: Financial Times, US Treasury Estimates

Bridging the tax gap. (Creative Finance).
March 1, 2002... What do you do if you owe back taxes, but are short on cash? Pay the government with steel bridges. That, at least, is what Sao Paulo-based flat-steel maker Cosipa is doing. To make good on taxes it owes the state government, the company is...

Living room banking. (The New Economy).
March 1, 2002... Okay, so most Argentine bank accounts have been frozen, or seized and converted to bonds, with tight limits on weekly withdrawals. But if DirecTV has its way, it will be easier than ever for Argentines to access information on their bank...

Cheap Internet access? (Telecommunications).
March 1, 2002... One of the great hurdles to Internet penetration in Latin America has been the high cost of access via the phone. Unlike the US, where a basic fee covers all local calls of any length, in Latin America most local calls are billed by the...

Towering ambition: sometimes success is measured a few feet at a time. That is certainly the case for Mexico City's Torre Mayor. When finished in December, it will be the tallest building in Latin America--by one meter. (Strategies).
March 1, 2002... SEVEN MONTHS AFTER the destruction of New York's World Trade Center, one might suspect that flashy, ostentatious office towers which dwarf everything else around them have become about as popular as all-inclusive vacation packages to...

Making pan-regionalism work: cable television programmer Discovery Communications penetrates Latin America, Spain and Portugal with a careful mix of local and regional content. (Strategies).
March 1, 2002... MANY BUSINESS models have collapsed under the weight of the assumption that Latin America is a single market. So Discovery Communications Latin America/Iberia (DLAI), the Miami-based division of cable television network Discovery...

Peru's third mobile wheel. (Strategies).
March 1, 2002... In less than two years, Telecom Italia has gone from non-entity to strong player in Perus mobile phone market. Local CEO Pedro Aguado says its all about freedom -- and marketing pre-paid services to the middle class and youth markets. ...

Big fish, small pond: Panama is not the banking center it once was. But Banistmo's CEO is determined to dominate what's left of the local industry. (Strategies).
March 1, 2002... ALBERTO VALLARINO IS no stranger to volatility When the US invaded Panama in 1989 and Manuel Noriega's regime collapsed, he was a board member of Panama's largest private bank, Banco del Istmo. After the banks manager abandoned his post,...

When one plus one equals three: Colombia's two largest airlines have finally formed a strategic alliance. Call it the silver lining of Sept. 11. Or, perhaps, the year of CEO Juan Posada. (Strategies).
March 1, 2002... ANYONE WHO OPERATES a major airline will tell you bigger is better. Everything from the ability to negotiate fuel purchases to the cost effectiveness of reservation systems s enhanced with scale. That, at least, was the argument put to...

Golden arches over Brazil.
March 1, 2002... Worldwide, few countries rival Brazil's reputation as a consumer of fast foods. So it's no mean feat for McDonald's Brazil CEO Marcel Fleischmann to grab the largest single market share in this highly competitive business. The Golden Arches...

Glass half full? Is it turnaround time at Vitro? Mexico's open markets, as well as past executive blunders, have been tough for the giant glass manufacturer. Does Federico Sada Gonzalez finally have the right formula?
March 1, 2002... GRUPO VITRO, MEXICO'S LARGEST GLASSMAKER, is as much a part of the nation's industrial royalty as the Sada family that founded it 93 years ago. Long before Nafta - when Telefonos de Mexico was a state-owned company, banks had been...

The appetite remains: turmoil in the region? Certainly. But is that any reason for private equity fund managers to shy away from Latin American deals? Apparently not. (Marketplace: Investment Outlook).
March 1, 2002... WITH ARGENTINA'S financial crisis, and turmoil in other countries in the region, it might be tempting to assume that private equity investment in Latin America is dead--or at least in a coma. But a recent survey by accounting firm KPMG LLP...

Bullish on Latin America: despite the slow growth of Brazil, the no-growth of Mexico and the collapse of Argentina, Latin America's Markets will outperform global indexes in 2002. (Marketplace: Equities).
March 1, 2002... THE RETURN PERFORMANCES of emerging equity markets so far this year, versus their developed market peers, has been impressive--up 5.6 percent versus down 4.0 percent for developed markets. That includes Latin America, especially Mexico, our...

Doing business in Argentina. (Marketplace: Country Perspective).
March 1, 2002... Argentina's stunning transformation from economic showcase to basket case caught even the most seasoned observers by surprise. Now the question is how to do business with Latin America's third-largest nation - if at all. "I'VE NEVER SEEN...

Private Banking & Wealth Management Roundtable. (Marketplace).
March 1, 2002... THE PRIVATE BANKING INDUSTRY HAS BEEN undergoing profound changes in recent years, prompted by factors ranging from new regulatory requirements to revolutionary developments in technology More recently, private banking and wealth management...

Gadgets to go: just enjoy. That's the message these gadgets seem to send at first. But don't be fooled--each boasts powerful technology and features. (Style of Life: Gadgets).
March 1, 2002... KODAK EASYSHARE DOCK AND EASYSHARE DX3700 CAMERA Kodak's EasyShare Dock makes transferring photos from digital camera to computer easier than dropping off film at the photo shop. The hard work only has to be done once: installing software...

Latin fashion: the View from New York; a recent exhibition of Latin style at the New York Fashion Institute of Technology shows an influence more profound than the current infatuation. (Style of Life: Fashion).
March 1, 2002... DESIGNERS IN THE U.S. DON'T NEED TO speak Spanish to understand Latin American glamour. In fact, language was not an issue during the New York Fashion Institute of Technology exhibition "Latin American Fashion: Exploring Identities On The NY...

Chilean collector: photographer--and businessman--Don Roberto Edwards started his impressive collection of Latin American masters by making an art out of bartering. (Style of Life: Art).
March 1, 2002... CHILE'S HISTORY RINGS WITH THE NAME EDWARDS. FROM the beginnings of the carbon industry and the building of trains, to the Banco de A. Edwards and the main Chilean newspaper El Mercurio, this rich and famous family has had a hand in nearly...

Sacred Peru: a traveler's experiences among the breathtaking monuments to Peru's ancient Incan culture and the modern, bustling capital city of Lima. (Style of Life: Travel).
March 1, 2002... A TIRED SUN MOVES ACROSS PERU'S Sacred Valley of the Incas while a tour group, along with about 15 locals, gathers in the shadow of the ancient Incan stronghold of Oriente Tambo. The structure, with its steep stairs, is made from giant,...

Property as currency: property possession laws are a cornerstone of successful capitalism. Latin America is finally on its way to developing them. (Final Thoughts).
March 1, 2002... PERUVIAN ECONOMIST HERNANDO DE SOTO, in his book "The Mystery of Capital," calculates that residents of developing countries hold more than US$9.3 trillion in property--but it earns them next to nothing. No laws or institutions exist by which...