Latin America at a glance: May 2017

In this section we provide you a wide overview of Latin American regarding:

Economy, Politics and Business Opportunities… in 2 minutes.

The Latin American Region is expected to have returned to growth in Q1. Uncertainty related to the potential course of U.S. trade policy and to a more challenging external scenario for Latin America has receded somewhat in the past month. Indeed, the perception of a coordinated global growth pickup seems to have gained momentum at the outset of this year. In line with a synchronized recovery in most emerging economies, the signs of recovery that began to show at the beginning of the year have also strengthened in Latin America. Our preliminary Consensus estimate suggests that the aggregate GDP for the region increased 0.2% year-on year in Q1 2017, which, if confirmed, will mark a return to growth in Latin America, following five consecutive quarters of contraction. (FOCUSECONOMICS Consensus Forecast April 2017). Brent Source: FOCUSECONOMICS

• April 27, 2017. “I know all about the lemons,” Trump told reporters when greeting Argentine President Mauricio Macri at the White House on Thursday. “We are reviewing that very seriously. We’re going to be very favorably disposed.” Unblocking the freeze on lemon imports would represent a symbolic victory for Macri, who has pledged to open up Argentina after more than a decade of economic and geopolitical isolationism. Source: Bloomberg
• May 7, 2017. BUENOS AIRES – Argentina and China will sign this month a contract in Beijing for the construction of two new nuclear powered plants, with an investment of US$ 12.5 billion, according to Argentina’s Nuclear energy deputy secretary Julian Gadano. “We still have some details to iron out, but the frame contract will be signed when president Mauricio Macri makes an official visit to China on May 17th,” said Gadano. Atucha III, Argentina’s fourth nuclear plant will be constructed in the province of Buenos Aires, close to Atucha II and will produce 745 MW. Fuel will be natural uranium and heavy water, with works scheduled to begin in 2018. Gadano said the whole construction of the project is estimated in seven years costing 6 billion U.S. dollars. As to the fifth nuclear plant it will have 1150 MW power and will be fueled with enriched uranium and light water. Source: Santiago Times.

• May 10, 2017. RIO DE JANEIRO – Former Brazilian President Luiz Inacio Lula da Silva will face corruption judge for 1st time. He is getting ready to make a first appearance before the federal judge overseeing a probe of billions of dollars in kickbacks to politicians and other officials. Source FoxNews.
• April 27, 2017. SAO PAULO – Seven Latin American countries are asking Brazil to share information on the dozens of plea bargains made by executives of Brazilian construction company Odebrecht (one of the companies at the center of a kickback scheme involving state oil company Petrobras). The head of international cooperation at the attorney general’s office tells The Associated Press that Mexico, Argentina, Venezuela, Colombia, Peru, Ecuador and the Dominican Republic have made 19 requests related to the case so far. Vladimir Aras spoke on Thursday. Source: FoxNews

• May 3, 2017. Ecopetrol today announced a new discovery of natural gas in the Colombian Caribbean. According to the state-controlled oil and gas company, which has a 50% stake in the well, the Gorgon-1 exploratory well has shown the presence of deepwater gas intervals ranging from 80 to 110 meters. “We are pleased to be able to announce this third discovery in the southern Colombian Caribbean,” said Juan Carlos Echeverry, president of Ecopetrol. “The results confirm that Colombia can count on a new area for the production of gas, a clean fuel with growing demand in the international market. This discovery will be important for the future of Colombia’s gas supply. The exploratory successes of the Caribbean are part of Ecopetrol’s strategy that, since 2017, has focused on increasing hydrocarbon reserves.”
• In its 2017 budget, Ecopetrol more than doubled its planned investment in exploration compared to 2016. “Investment in exploration will rise from $280 million USD to $650 million USD, thus increasing offshore wells from two to six and onshore wells from five to 11 from 2016 to 2017,” said Echeverry earlier this year. Source: FinanceColombia
  

• April 27, 2017 , Washington. President Donald Trump told “I decided rather than terminating NAFTA, which would be a pretty big, you know, shock to the system, we will renegotiate,” he told reporters before a meeting with the Argentinian President.  In a description of Trump’s phone calls to Prime Minister Justin Trudeau and President Enrique Peña Nieto, the White House said Trump “agreed not to terminate NAFTA at this time and the leaders agreed to proceed swiftly, according to their required internal procedures, to enable the renegotiation of the NAFTA deal to the benefit of all three countries.” Source: CNN
  
• May 10, 2017. The Italian cable manufacturer Prysmian Group will invested US$ 15 million to produce optic fiber cable in a facility located in the northern state of Durango. According to Jaouad Ben-Hamman, General Director for Prysmian Mexico, the plant will supply 1 million kilometers (621,371 miles) of optic fiber cable to its customers over the first year. But production is expected to reach up to 8 million kilometers over the next years as additional investments are made, totaling US$ 20 million by 2019. Source: MexicoNow
• May 9, 2017. Inflation does not let up in Mexico. The general price index rose in April by 5.82%, slightly above the expectations of the main analysts, and set a new high in almost eight years, according to figures released by the Mexican statistical office.  The underlying index – which does not take into account the price of food or energy products, the most volatile – rose, meanwhile, 4.72% in the fourth month of the year compared to the same period in 2016. It is The highest monthly price hike since May 2009, just after the global financial crisis and at the height of raw materials prices. Source: El país
  
• May 2, 2017. Bosch announced the sale of its division Robert Bosch Starter Motors Generators Holding GmbH, including all subsidiaries, to the purchaser consortium ZMJ (Zhengzhou Coal Mining Machinery Group Co., Ltd.), and CRCI (China Renaissance Capital Investment). The business unit has under 7,000 associates and 16 locations in 14 countries, including Brazil, China, Hungary, India, South Africa, Spain, the United States and Mexico (Toluca). Source: MexicoNow.
• April 25, 2017. Heineken N.V. announced plans to incorporate Mexican beer Tecate to its international portfolio, a measure that will expand the product’s presence from 17 up to more than 70 countries around the world. Tecate will be the second Mexican beer under the Heineken umbrella to reach global status following Sol beer, launched over international markets in 2013. Source: MexicoNow

• Uruguayan pharmacies will start selling cannabis. In 2013 the senate voted to legalise marijuana and regulate its production and sale, making Uruguay the first country to do so. (Canada proposed a bill to legalise cannabis for recreational use on April 13th.) Uruguay’s goal is to stamp out the black market, controlled mainly by Paraguayan smugglers, without encouraging more consumption. Registered Uruguayans (but not visitors) will be able to get the drug in one of three ways. They can grow up to six plants at home; join a club, where 45 members can cultivate as many as 99 plants; or buy it in pharmacies. All consumers are restricted to 40g (1.4 ounces) a month, enough to roll a joint or two a day. About 10% of adults smoke at least once a year. Store-bought marijuana will be cheaper than what is available on the street. The quality will be better, says Milton Romani. Source: The Economist.
  

May 1st,  Venezuelan President Nicolás Maduro announced that he convened a National Constituent Assembly.  A Constituent Assembly aims to “transform the State, create a new legal system and draft a new Constitution.” In addition, the president “can not object to the new Constitution” and “constituted powers can not in any way impede the decisions of the National Constituent Assembly,” says the current charter. Source: CNN 

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