What's New
Hola Business News - January 2010
Scores of 2009 and Promises of 2010 for business with Latin America...
India's biggest sugar refiner Shree Renuka Sugars Ltd has signed a definitive agreement for a 51 percent stake in Brazil's Equipav SA Acucar e Alcool for $329 million. The Brazilian firm, which holds the sugar and alcohol assets of Equipav Group, owns two large sugar mills with integrated co-generation facilities, in southeastern Brazil. The sugar mills have a combined annual cane-crushing capacity of 10.5 million tonnes, co-generation capacity of 203 MW and 115000 hectares of cane growing land..The Indian firm will expand the co-generation capacity to 295 MW and cane-crushing capacity to 12 million tonnes annually with additional capital expenditure.
In November 2009, Renuka had acquired sugar and ethanol producer Vale Do Ivai S.A. Acucar E Alcool for $240 million.
With these Brazilian acquisitions, Renuka has become the third biggest sugar company in the world, the number one sugar firm in India and among the top five in Brazil.
Strides Arcolab acquires pharma assets of Aspen in Brazil for $ 75 million - March 2010
Strides Arcolab has bought Aspen's ( south african company ) facility in Campos, Brazil, with related products and intellectual properties for about $75 million. It is an all-cash acquisition.
The facility makes Penems and Penicillins and has annual turnover of $40 million.
Strides Arcolabs is already
operating in Brazil as Cellofarm with a manufacturing unit in the port city of Vitoria near Rio de Janeiro.
Strides has a manufacturing facility in Mexico City in the name of Solara and has a
marketing & trading operation in Venezuela as Sumifarma.
Latin America will grow by 4.3 % in 2010
This good news comes from ECLAC ( Economic Commission for Latin America and Caribbean- which is part of the United Nations) in their 10 December 2009 report.
The GDP of the region which fell by 1.8% in 2009 due to the global crisis will resume growth in 2010 with 4.3 %. The region had an annual average growth of 4.8% in the period 2003-2008. In this period, the region enjoyed a current account surplus as well as primary surplus, accumulated foreign exchange reserves, reduced external debts, booming exports and strong macroeconomic fundamentals. This is the strength which helped the region to withstand the global crisis in 2008-9 with only moderate adverse impact and bounce back in 2010.
The 4.3% growth of Latin America in 2010 is higher than the growth projected for developing countries ( 4%) except China and India.
Brazil will be the 2010 champion of the region with the highest growth of 6%. Ooops... I do not recall Brazil topping the growth chart of the region in recent times. Uruguay and Peru will be runners-up with 5% each.
Mexico, the second largest economy which suffered the worst GDP contraction of the region in 2009 with 6.7% will grow by 3.5%. Argentina, the third largest market will grow by 4%.
It is no surprise that the least growth in 2010 in the region will be in Honduras, which is in a political crisis.
While South America is expected to grow by 4.7% in 2010, the Caribbean and Central America are projected to grow by around 2%.
Inflation in the region in 2009 is estimated to have declined to 4.5% from 8.3% in 2008.
India´s trade with Latin America in 2009
India´s exports to the region went down by about 30 percent in 2009 in comparison to 2008. This was expected, after the global crisis and local import restrictions by the governments which wanted to protect domestic industries and minimise outflow of foreign exchange.
Below are the trade figures in Million US dollars:
|
India’s exports |
India’s imports |
2009 |
2008 |
2009 |
2008 |
Brazil
jan-nov
|
1906 |
3337 |
2920 |
948 |
Mexico
Jan-oct |
785 |
1254 |
935 |
1305 |
Argentina
Jan-Dec |
342 |
492 |
876 |
836 |
Colombia
Jan-Oct |
412 |
430 |
292 |
14 |
Chile
Jan-Nov |
251 |
428 |
858 |
1693 |
Peru
Jan-Oct |
273 |
470 |
72 |
303 |
Uruguay
Jan-Dec |
42 |
47 |
11 |
9 |
Paraguay
Jan-Dec |
51 |
40 |
59 |
38 |
Indian IT company Global Sourcing Solutions (Flatworld Solutions) has opened a Centre in Buenos Aires in January 2010
Flatworld solutions has started off with 100 staff and has plans to expand. The company specialises in mobile software and operates call centres and BPOs. They have operations in Peru, Colombia, Paraguay and Bolivia in Latin America. Their website http://www.flatworldsolutions.com/
Devaluation of Venezuelan currency Bolivar – 8 January 2010
This was announced by the President of Venezuela on 8 January. Besides devaluation, the President also introduced a two tier exchange rate system. The bolivar will now have two government-set rates: 2.6 to the dollar for transactions deemed priorities by the government, and 4.3 to the dollar for other transactions.
The priority exchange rate of 2.6 Bolivar for a dollar will apply to imports of priority items such as food, machinery and equipment for economic development, health care items and books and supplies for schools, family and pensioner remittances as well as public sector imports. For all other imports and non essential items the exchange rate of 4.3 will apply.
Before this devaluation, the official exchange rate had been held by the government at 2.15 bolivars to the dollar after the last devaluation in March 2005. President Chavez imposed exchange controls in 2003 after the coup attempt against him. At that time the exchange rate was 1600 Bolivars to a dollar. In February 2004 the rate was changed to 1920 Bs for a dollar and later in 2005 it was further devalued to 2150 Bs to a dollar. In January 2008, the government changed the currency to a a strong Bolivar ( Bolivar Fuerte) and fixed the new rate at 2.15 to a dollar, eliminating three zeros from the old currency.
The black market rate in January 2010 is 6.25 Bs to a dollar. Because of the foreign exchange restrictions and complicated procedures to get foreign exchange, there has been a thriving black market in foreign exchange transactions since 2003.
4TH INDIA- LATIN AMERICA AND CARIBBEAN CONCLAVE 29-30 April 2010 at Taj Palace Hotel, New Delhi
The Confederation of Indian Industry (CII) is organizing the 4th India-Latin America and Caribbean Conclave: Enhancing Business Partnerships
4th in the series, the Conclave will discuss business opportunities and project partnerships between India and the LAC region in Agriculture, Agri-business and Food Processing, Irrigation, Telecommunications, Energy including Renewable Energy, Infrastructure, Software Services, Drugs & Pharmaceutical Products, Biotechnology, Chemicals including Agro-Chemicals, FMCG goods, Transportation & Logistics, Media & Entertainment, Tourism & Hospitality and Healthcare.
The Conclave will feature sessions devoted to sectoral business presentations followed by B2B meetings on each day. More details of the programme are being worked out and would be forwarded later.
CII would partially offset the cost of travel to India of these business participants from the LAC countries. This would be on first-come-first-served basis for business participants travelling to India to participate in the Conclave series for the first time and would be limited to one representative from one company.
India- LAC Business Summit - March 30-31, 2010 - New Delhi
FICCI (Federation of Indian Chambers of Industry and Commerce) is organizing a Summit to bring Indian industry, investment promotion organisations, financial institutions and decision makers and their counterparts in Latin American countries together.
The event will focus on the following sectors: agriculture and food processing, pharma, biotech, IT, chemicals and fertilisers, machinery, automotives and transportation, energy, mining, jems and jewellery, textiles, garments, leather goods, wood and wood products and tourism.
More information: www.ficci.com