Latin CEO: Executive Strategies for the Americas articles from November 2001

Latin CEO: Executive Strategies for the Americas archives from November 2001

Moving forward. (Letter from the Editor).
November 1, 2001... WE ARE NOW into the third month after the terrorist attacks in New York and Washington, and sadly enough, the world is still reeling. Despite the relatively small amount of physical damage done--in global terms--the psychological impact...

Auto Industry Props. (Upfront: Argentina).
November 1, 2001... Despite a 41.5 percent drop in auto sales this year, multinationals have spent some US$790 million to keep their Argentine plants open. Cash infusions to the subsidiaries, which expect to lose US$500 million this year and are running at 30...

Auction off. (Upfront: Brazil).
November 1, 2001... All bidders have dropped out of the auction for Parana state utility Companhia Paranaenses de Energia (Copel), leading to further postponement of its sale. Belgium's Tractabel, Companhia Vale do Rio Doce (CVRD) and Votorantim Energia were the...

A monopoly is born. (Upfront: Brazil).
November 1, 2001... CVRD has partnered with Japan's Mitsui & Co. to purchase iron ore producer Caemi, giving CVRD control of every iron ore exporter in Brazil. The European Union approved the deal on condition that Caemi sell its 50-percent share in Canada's...

Power up. (Upfront: Brazil).
November 1, 2001... Heavy rains, energy savings, slower economic growth and mobile emergency generators have led to reductions in power rationing as of December 1 in all regions except the Northeast. The government will begin authorizing additional energy use...

Fiesta for Ford? (Upfront: Brazil).
November 1, 2001... US-based Ford Motor Co. has opened a US$1.2 billion, 700,000-square-foot plant near Salvador, despite the fact that recession has slowed vehicle sales in the country and led to 40 percent excess production capacity for the industry. The plant...

Thermo electricity. (Upfront: Brazil).
November 1, 2001... Alstom Power of France will supply the Temorio thermoelectricity project (owned by P115, Petroleos Brasileros, and US-based NRG Energy) with US$542 million of turbines and equipment. Alstom has also sold US$45 million of gas turbines to the...

Electricity of our own. (Upfront: Brazil).
November 1, 2001... Facing production cuts from energy rationing, and consequent drops in exports (some US$310 million lost as of 3Q 2001), aluminum companies have decided to increase their investments in self-generation energy projects--for up to 50 percent of...

Next-generation mobile. (Upfront: Chile).
November 1, 2001... With its launch of 2.5G telephony in metropolitan Santiago, Entel PCS has become the first company in Latin America to offer high-speed Internet services via mobile phones (at speeds up to 114 kilobits per second.) The company has spent US$20...

Coker cooking. (Upfront: Chile).
November 1, 2001... Ferrostaal of Germany and Foster Wheeler of the US have agreed to build a delayed coker for Empresa Nacional de Petroleo (ENAP), at an expected cost of US$300 million. Construction at Enap's RPC refinery in Concon will begin in late 2002,...

Suit settled. (Upfront: Mexico).
November 1, 2001... The government has paid US-based Metalciad just over US$16 million to settle a NAFTA claim that Mexico expropriated the company's hazardous waste facility in San Luis Potosi. Mexico had agreed to settle the 1996 case in June 2001, but never...

Texcoco landing. (Upfront: Mexico).
November 1, 2001... The government has chosen a site in Texcoco for a new international airport, instead of one in the state of Hidalgo. The airport will take five years to build and cost US$2 billion, 75 percent of it privately financed. It will handle 1.1...

Pet project. (Upfront: Mexico).
November 1, 2001... Italy's Gruppo Mossi & Ghisolfi has announced construction of a US$200 million polyethylene terephthalate (PET) plastics plant in Altamfra, betting that 2000's 15-percent growth in Mexico' PET industry will continue. The new plant will more...

Bank to Bank. (Upfront: Mexico).
November 1, 2001... In a reversal of sorts, Banca Serfin (owned by Banco Santander Central Hispano) has lent Instituto de Proteccion al Ahorro Bancario (IPAB) US$1.063 billion at an interest rate that is 0.25 percent above the interbank rate, with a 10year term....

Tools from Texas. (Upfront: Mexico).
November 1, 2001... The US governments Export-Import Bank of the US has guaranteed US$300 million in long-term loans for US$335.3 million worth of exports for Petroleos Mexicanos' Cantarell Oil Field project in the Bay of Campeche. The exporters include Texas'...

Mortgage market creator. (Upfront: Mexico).
November 1, 2001... The government has created Sociedad Hipotecaria Federal, a mortgage agency specifically directed at middleand low-income families that will also help create a secondary market for mortgages in the country. The new agency will replace Fovi,...

Railroad works. (Upfront: Venezuela).
November 1, 2001... Odebrecht of Brazil and Vinccler of Venezuela have won a US$208 million construction contract for the 9.5 kilometer Los Teques to Las Adjuntas light railroad in the province of Miranda. The project is expected to employ 2,650 people during...

Mandated microloans. (Upfront: Venezuela).
November 1, 2001... President Hugo Chavez has signed a new banking law that requires private banks to set aside a portion of capital for loans to low-income citizens. Such micro-loans must represent at least 3 percent of the banks' loan portfolios.

Wireless subscribers in Latin America, 2001.
November 1, 2001... Wireless Subscribers in Latin America, 2001 (million of subscribers) Mexico 19,761 Ecuador 607 Colombia 3,059 Venezuela 6,529 Peru 1,847 Bolivia 818 Paraguay 829 Brazil 29,731...

Post-9.11 forecast changes.
November 1, 2001... Post-9.11 Forecast Changes Sept. 11 changed everything, not only in the US but in Latin America. Here we look at how Dresdner Bank Lateinamerika changed its GDP and inflation growth forecasts for the region--after the terrorist...

Colombian banking conundrum. (Bulletin Board).
November 1, 2001... * Profits of Colombian banks, January-August 2001: US$120 million * Losses, January-August 2000: US$621 million * Money lent to banks by Colombia's deposit guarantee agency since a bailout began in 1999: US$2.98 billion Source:...

Material minded. (Bulletin Board).
November 1, 2001... * Sales at Argentina's first Armani store during its three-day opening period in October: US$100,000 * Increase in Venezuelan retail sales, January-August 2001, compared with 2000 sales: 34% * Increase in Chilean retail sales,...

Put it on the card. (Bulletin Board).
November 1, 2001... * Internet users in Brazil who have a "major concern" about credit card security on the Internet: 51% (No. 4 worldwide) * Internet users in Brazil who buy online: 10% * Internet purchases paid for by credit card during 2000: 74% ...

Korean cuts. (Bulletin Board).
November 1, 2001... * Total employment at Mexico's eight largest Korean-owned factories, September 2001:11,210 * Total employment in 2000:13,050 * Decrease: 14% Source: The Wall Street Journal, Korean Maquiladora Association, company reports

Well-paid in Peru. (Bulletin Board).
November 1, 2001... * Monthly pay of Peruvian president Alejandro Toledo: US$18,000 * Monthly pay of Mexico's Vicente Fox: US$11,700 * Monthly pay of Colombia's Andres Pastrana: US$6,650 * Monthly pay of Argentina's Fernando de la Rua: US$3,500 ...

Low-cost pulp. (Bulletin Board).
November 1, 2001... * Average production cost of a ton of hardwood pulp in Brazil: US$165 * Average cost in Indonesia: US$169 * Average cost in North America and Europe: US$272 to US$325 Source: Financial Times

Big burn. (Bulletin Board).
November 1, 2001... * World's largest single incineration of illegal narcotics: 140 tons * Location: Cubato, Brazil, at the Companhia Siderurgica Paulista (Cosipa) blast furnace plant Source: AP Worldstream

Aerolineas Argentinas. (Investments, IPO's and M&A's).
November 1, 2001... The Spanish government has sold troubled Aerolineas Argentinas to a group led by Spanish travel company Grupo Marsans. The buyers will assume half of the airline's US$1.2 billion of debt and promise to recapitalize the company with US$50...

Dutch financial group ING. (Investments, IPO's and M&A's).
November 1, 2001... Dutch financial group ING announced the sale of its Argentine health care group, Aetna AMSA, to Argentine insurer SPM. If approved by regulators, the merger would create the largest health care provider in the nation. Terms of the deal were...

Cemig. (Investments, IPO's and M&A's).
November 1, 2001... Cemig, Brazil's largest utility company, plans to issue US$225 million of bonds in November that will mature in eight and 10 years and yield about 12 percent annually above the IGPM inflation index.

Eletrobras. (Investments, IPO's and M&A's).
November 1, 2001... Brazil's largest power generator, Eletrobras says it plans to raise US$960 million in loans and locally-issued debt instruments, to finance construction of power plants and transmission lines.

US Securities and Exchange Commission. (Investments, IPO's and M&A's).
November 1, 2001... Chile's government has filed with the US Securities and Exchange Commission for permission to sell US$2 billion of debt securities and warrants in the US. The money will be used to pay for general expenditures, including the repurchase or...

Chilean. (Investments, IPO's and M&A's).
November 1, 2001... Chilean banking and securities regulators approved the merger of Banco de Chile and Banco de A. Edwards, which would create the nation's largest bank, with US$12 billion of assets. Both banks are owned by Chile's Luksic family.

Chile. (Investments, IPO's and M&A's).
November 1, 2001... The government of Chile will sell an estimated US$737 million of water utility assets, including a 20 percent stake in Essbio and holdings in Emos and Esval.

Cemex. (Investments, IPO's and M&A's).
November 1, 2001... Cemex's US$300 million bid to acquire 73 percent of Thailand's TPI Polene is still in play. An agreement signed by the companies bars TPI from negotiating with other bidders until February 2003. The Thai government is keen to close the deal...

Grupo Prisa. (Investments, IPO's and M&A's).
November 1, 2001... Grupo Prisa, Spain's largest media group, says it will pay US$50 million for a 50 percent stake in Mexican radio network Sistema Radiopolis, which is owned by Grupo Televisa. Prisa announced it will also invest an additional US$10 million in...

Spain's Banco Santander Central Hispano SA. (Investments, IPO's and M&A's).
November 1, 2001... Spain's Banco Santander Central Hispano SA will merge its two Venezuelan units by first quarter 2002. The merger of Banco de Venezuela SA and Banco Caracas SA will create the nation's largest bank with US$5 billion of assets.

CMS. (Investments, IPO's and M&A's).
November 1, 2001... US-based power company CMS plans to sell, by the second half of 2002, all US$415 million of its assets in Brazil, Argentina, Venezuela and Jamaica.

CANTV shareholders win, AES loses. (Deals Spotlight).
November 1, 2001... * The four-month attempt by US-based power company AES Corp. to take control of phone giant Compania Nacional Telefonos de Venezuela (CANTV) has taken another setback. Venezuelan regulators approved a share buy-back plan proposed by CANTV...

No break for Argentina. (Deals Spotlight).
November 1, 2001... * International lenders have all but shut the door on the Argentine government and its ability to raise new funds on the capital markets. But now even a restructuring of existing debt is creating flak. The government announced a sweeping plan...

Taking a shine to copper. (Resources).
November 1, 2001... Anyone familiar with mining in Latin America knows that copper is one of the top metals in the region. Chile alone produces one third of all the copper mined in the world, and extensive copper mines can also be found in Peru and Mexico. The...

3,000 leagues under the sea. (Energy).
November 1, 2001... Petrobras is already acknowledged as the world's leading oil company when it comes to drilling in ultra-deep waters. Now Brazil's state oil company wants to take it deeper. Petrobras president Henri Philippe Reichstul recently revealed the...

University airwaves. (Education).
November 1, 2001... SOMETIMES IT JUST DOESN'T PAY TO rip up the ground for fiber optic cable. Not when you can connect everybody with Vsats--very small aperture satellite dishes. That logic seems apparent to the academicians at Colombia's Universidad Pedagogica...

Bigger planes, smaller market. (Strategies).
November 1, 2001... A worldwide slump in sales has given aircraft manufacturers a headache in recent months. All the more reason for CEO Mauricio Botelho to roll out a new line of aircraft at Brazil's Embraer--even as he slashes the payroll. PART OF THE...

Borderline business: Martel's CEO is talking tough in an effort to combat contraband goods flowing across Paraguay's border. (Strategies).
November 1, 2001... THE BEST BUSINESS in Paraguay, Rolando Niella resignedly sighs, seems to be illicit trade. "Contraband, piracy and the counterfeiting of goods are the only prosperous activities," says Niella, CEO and owner of clothing manufacturer Fenix SA,...

Phone fundamentals: this month, the Bolivian telecom industry opens up. But can newcomer AES grab market share from state-owned incumbent Entel? AESs top Bolivian executive believes she can. (Strategies).
November 1, 2001... ON NOV. 27, MOUNTAINous, landlocked Bolivia--one of Latin America's poorest nations--will throw its telecom sector wide open to competition in a dramatic effort to improve quality, bring down prices and jump-start a crumbling economy. ...

Is Pemex going private? The Mexican government is testing the waters by allowing state-run oil giant Pemex to court private investors--sort of. (Strategies).
November 1, 2001... MEXICANS HAVE long considered the nation's oil reserves to be part of the national patrimony, a belief that borders on religious conviction. For that reason, the government has steadfastly resisted any attempt to privatize the sector, while...

Transmission mission: Globecast CEO Robert Behar always knew satellite broadcasting had a major future in the region. Now, in the post 9-11 world, his company is reaping even greater rewards. (Strategies).
November 1, 2001... ROBERT BEHAR HAS 16 televisions on shelves in his Miami-area office, plus one large, flat High-Definition TV hanging on the wall. Each plays a different television network. All are clients of broadcast services provider Globecast Americas,...

Top ten Foreign Banks in Miami.
November 1, 2001... Top Ten Foreign Banks in Miami (assets as of June 30, 2001 in millions of US$) Home Type of Florida Bank Name Country Office Assets Lloyds TSB Bank plc...

Money at the crossroads: starting with a small group of banks in the 1970s, Miami has become a major international banking center serving the Americas. (Introduction).
November 1, 2001... FOR DECADES, INTERNATIONAL BANKING was overshadowed by tourism, trade and other pillars of the Greater Miami economy But the local business that began with a tiny handful of international banks is now led by a blend of giant multinational...

Counting the money: private banks have long ruled the domain of money handling for the ultra-rich But the game has changed as the Brickell Avenue financial district embraces new products and encounters new challenges. (Private Banking).
November 1, 2001... WHEN CITIBANK VETERAN THOMAS NOONAN was offered a transfer from New York to run the bank's Latin America operations in Miami 16 years ago, he had reservations. After all, for many, New York was the financial capital of the world. Why leave?...

Point of departure: with millions of dollars flowing through the city daily, Miami has become a one-stop shop for those looking to finance trade in the Americas. Now trade financiers face the fallout of a stubborn recession. (Trade Finance).
November 1, 2001... INCREASINGLY, MIAMI HAS BECOME A LINE of demarcation for many in the banking industry With its population representing more Latin American nations than any other spot in the US, and its trade with the region second-to-none in the States, the...

Which way up? International banks are trying to chart a course through the murky waters of recession, regulation and consolidation. But whatever direction the industry is headed, Miami is in good position to benefit from it. (Industry Trends).
November 1, 2001... TRYING TO PIN DOWN WHAT DIRECTION international banking is headed in Miami is like trying to hit a moving target. But one thing is certain: The industry must quickly adapt to a changing regulatory environment and conservative consumer...

Banking connections: from institutions with a pan-regional presence in the Americas, to those specializing in particular countries, this directory of international banks covers the local landscape.
November 1, 2001... ABN AMRO Bank, NV Home Country: Netherlands Assets: US$707,745,000 Address: 5301 Blue Lagoon Dr., Suite 390, Miami, FL 33126 Telephone: 1-305-925-8786 Fax: 1-305-577-8483 www: abnamro.com Type of Office: Agency...

Salinas sallies forth. Again.
November 1, 2001... He came close in 1997 with a US$700 million offer for Telemundo. Last year the bet was with US station operator Harry Pappas. Now he is going it alone. Does Ricardo Salinas Pliego finally have the right formula to break into the lucrative US...

Bitter brew: Mexico's government comes to the rescue of struggling coffee farmers. But will financial aid be enough to turn the tide for an industry facing a worldwide glut and increased competition? (Commodities).
November 1, 2001... CAN THE COFFEE CRISIS get any worse? Not from the point of view of the Mexican farmer. With prices suffering 35-year lows, masses of coffee growers have been forced to abandon their farms in search of work, cutting Mexico's 2000-2001 harvest...

More aftermath: reports are beginning to trickle in that analyze the impact the Sept. 11 terrorist attacks have had on Latin America's economic outlook for the rest of the year and into 2002. In a nutshell, the outlook isn't good. (Equities).
November 1, 2001... ECONOMIC GROWTH in Latin America had already begun to slow earlier this year, well before terrorists struck in New York and Washington, DC. Now, growth is down to a crawl, with nearly every sector of the economy showing signs of weakness....

Colombia's cultural cartel; Bogota's spectacular art museums show a side of Colombia not familiar to many people outside the nation: testimony to a culture that persists, even flourishes, amidst a less sanguine reality. (Art).
November 1, 2001... THE RENOWNED COLOMBIAN ARTIST Fernando Botero has recounted, in numerous interviews, how frustrating it was for him as a young man conducting his early studies of art without access to the original works of legendary painters. Botero, like...

Cultural capital: the city of Sao Paulo is huge, with seemingly endless avenues of concrete. Once you get past this psychological barrier, however, the city reveals itself as the cultural capital of Brazil, and perhaps of all South America. (Travel).
November 1, 2001... AT FACE VALUE, SAO PAULO CAN SEEM A bit characterless in comparison with the charms of competing tourist destinations such as Rio de Janeiro--with its famous Christ the Redeemer statue perched atop Corcovado Mountain--and Salvador, the...

Focus on a partner.
November 1, 2001... Jacky Delmar, President of Brascan Inmobiliaria, one of Brazil's largest antimost important developers, has been a long-standing fan of Inter-Continental[R] Hotels. "I've been conducting business in Latin America since the 1960s," says...

Bahia rhapsody; Bahia offers the tropical and folkloric elements that many foreigners associate associate with Brazil: large, uninhabited beaches, coconut palms, near year-round sunshine, colorful crafts and friendly inhabitants. (Travel).
November 1, 2001... EUROPEANS HAVE LONG BEEN THE MOST frequent visitors to Bahia, including the very first ones. Portuguese explorer Pedro Alvares Cabral, who discovered Brazil in 1500, arrived on the southern shore of Bahia and named it Porto Seguro--safe...

Giving good gift. (Gadgets).
November 1, 2001... The holiday season is upon us again, and with it comes the difficult task of finding the right gifts -- items that will do more than take up space on a desk or in a closet, yet have an air of frivolity to them. Maybe no one needs these...

The de-listing of Latin America: globalization has been a mixed blessing for Latin American companies in search of capital. It may be time for them to look homeward. (Final Thoughts).
November 1, 2001... FOR COMPANIES WITH A GLOBAL VISION, and the resources to make it a reality, the decline of barriers to trade and investment has allowed them to penetrate distant markets, extend their reach through acquisitions, enhance their competitiveness...