Exclusive outtakes from industry leaders
The Latin America Investment Summit, which will take place this week in over 16 cities in Latin America, the United States and Europe, will generate a series of exclusive interviews and articles from our team of expert reporters, as well as regular blog postings and online video, which will be immediately available only to Reuters clients during each summit.
As a region that can fuel millions of cars around the globe not only with its oil, but also with its crops, Latin America hosts two of the ten world’s biggest economies and moves billions of dollars every day in the equities, bonds and commodities markets.
In a continent where politics and business walk hand in hand, investors and entrepreneurs need to be updated on a wide range of topics.
Reuters will host over 60 executives from top Latin American companies, as well as central bank governors, ministers and regulators, to discuss the challenges of a buoyant region that is enjoying its best economic growth in 30 years, but fearing the impact of a recession in the United States.
Latin America is enjoying the benefits of a boom in commodities — pushing the price of everything from steel to oil to record levels.
Analysts point that, compared to 10 years ago, today many of the Latin American economies have better cash reserves, lower inflation and better growth. By how long will the party last?
Mining companies flush with cash from a commodities boom could emerge as the driving force in consolidation of the metals industry — not the metals companies themselves — Ian Christmas, secretary general of the IISI steel industry association, told Reuters journalists in London. “I’m not surprised that CVRD bought Inco last year. They had the cash. I wouldn’t be at all surprised to find the mining companies as the successful purchasers of Alcoa,” he said. Alcoa has made a $28 billion hostile bid for Canadian rival Alcan in what could be a defensive move to avoid being bought itself, while Brazilian mining group CVRD bought Canadian nickel miner Inco last year in a deal worth a total of $17.6 billion.
Telmex, Mexico’s leading fixed-line operator, is ready to add television services to its existing phone and Internet packages as it prepares to enter the triple-play market.
Carlos Slim, the world’s third-richest man and majority owner of Telmex, told Reuters Latin American Investment Summit how Televisa and TV Azteca, Mexico’s only private national broadcasters, are likely to become the company’s content providers.
The fight against Mexico’s drug lords comes at a price. President Felipe Calderon and his family have received threats for launching a war against the country’s main cartels.
Calderon, who spoke to Reuters Latin American Investment Summit this week, has sent thousands of troops to fight feuding gangs and has extradited Osiel Cardenas, head of the infamous Gulf Cartel, to face trial in the United States.
Soriana, Mexico’s No. 2 retailer, will focus on domestic consolidation in the next few years but starting 2010 it could explore opportunities to expand into the United States looking at both, the Hispanic and English-speaking markets.
Chief Executive Ricardo Martin Bringas told Reuters Latin American Investment Summit about the expansion possibilities north of the border.
For the past few years, America Movil embarked on a shopping spree that helped it consolidate its position as the No. 1 cellular phone service provider across Latin America. With over 125 million clients extending from the United States to Argentina, the company will now focus on boosting profit margins this year.
But the few countries in the region where it still does not have a presence — Panama, Bolivia, Venezuela and other small Caribbean nations — will remain in the company’s radar for when an acquisition opportunity surfaces, America Movil’s Chief Financial Officer Carlos Garcia Moreno told Reuters Latin American Investment Summit.
A proposal to overhaul one of the government’s pension systems was cleared by congressional committees this week in a rare agreement between Mexico’s top political parties. The legislation introduces private retirement accounts for public-sector workers but still needs approval from the Congress lower chamber and Senate.
If passed, the new pension system could push the government to take extra debt but would bolster public finances in the long term.
In order to boost Mexico’s economy and stop relying heavily on oil revenue, congressmen will have to pass a long awaited fiscal reform. The sooner, the better.
Deputy Finance Minister Alejandro Werner told Reuters Latin American Investment Summit that the reform could get the go-ahead by September, although the proposal might face tough negotiations in Congress.
From swanky lofts in the capital to modest houses for families all across the country, Mexico’s home building industry had never seen such a bonanza before. Thanks to a government program to spread the reach of mortgages to low-income earners and banks granting 30-year loans for the middle class to buy houses, the building sector is not likely to ease its thriving pace soon.
Homex, one of Mexico’s largest homebuilders, plans to sell around 16 percent more homes in 2007 as it bets on the ongoing strength of the mortgage market, the company’s Chief Executive David Sanchez-Tembleque told Reuters Latin American Investment Summit.