Friday, July 4, 2008

Fake 'Che' Shirts fool the FARC!!!! HA! Ironic, no?

`Che' Shirts, Fake Rebels, Acting Class Helped Free Betancourt

Bloomberg LP - click above to access article direct or click on Bloomberg's link and go to the Latin America section. Experts copy and pasted below.

By Helen Murphy

July 4 (Bloomberg) -- The T-shirts with images of Ernesto ``Che'' Guevara convinced Ingrid Betancourt. She assumed the men with the iconic revolutionary on their chests were ushering her into the helicopter for transfer to yet another rebel camp.

Instead, Betancourt, along with 14 other hostages, was taking her first steps toward freedom after six years of captivity at the hands of the Revolutionary Armed Forces of Colombia. Less than 24 hours later, she would be reunited with the two children she hadn't seen since her capture.

The white helicopter Betancourt climbed into was piloted by Colombian troops, and the six men wearing Che shirts were soldiers who tricked the rebels into following ``orders'' to move the prisoners. Colombian intelligence had infiltrated the group, known as the FARC, and started planning the rescue mission as long as a year ago.


The day of her release, Betancourt awoke as usual at 4 a.m. to listen to a radio program that broadcasts news and messages from family members to the FARC's more than 700 captives. She and her fellow hostages were told by their guards an international aid helicopter would come and take them to the encampment of Alfonso Cano, the drug-funded group's leader.


``The helicopters arrived, and these absolutely surreal characters came out,'' said Betancourt, gripping rosary beads after she landed at Bogota's military airport. ``They were wearing Che Guevara shirts and I thought, it's the FARC.''

The captives were handcuffed and manhandled onto the aircraft by the undercover agents. ``It was very humiliating,'' she said.

After the unmarked helicopter flew over the jungle and out of range of the FARC camp, the hostages saw the men in Che T- shirts spring on their captor. Gerardo Antonio Aguilar Ramirez, known by his alias as Cesar, was tied up, stripped and blindfolded. Then the Colombian troops revealed their identity.

``We are the national army, you are free!'' the agents told them. ``The helicopter almost fell out of the sky because we jumped and screamed, we hugged and cried,'' Betancourt said.


Colombian intelligence officials were able to plan the rescue, code-named Operation Check for the end-game chess move, with information from John Frank Pinchao, a police official who escaped in April last year and helped pinpoint the FARC camps. ``This was a movie-style rescue that freed 15 people who had been tortured for so many years,'' Defense Minister Juan Manuel Santos told reporters.

A sustained barrage of air and ground attacks on the FARC has weakened the group, and local commanders have largely lost contact with the senior leadership, ex-guerrillas say.

The military placed covert operatives inside the camp holding Betancourt about six months ago. They started to gain the trust of the commander Cesar, according to General Freddy Padilla, chief of the armed forces.

With help from a FARC leader who hasn't been identified, the military was able to con Cesar into thinking he'd been given the mission of transporting three groups of prisoners to Cano, who replaced the FARC's founder Manuel Marulanda in May after his death of a heart attack. Those who arrived in the helicopter were given acting lessons to pretend to be aid agency personnel, said General Mario Montoya, the army's top officer.

``I never expected to get out alive,'' said Betancourt, who thanked the military for its ``impeccable'' mission.

Plan B

The military had a Plan B. Some 30 helicopters and 58 men surrounded the camp, ready to strike or offer payments to the captors if the covert plan failed, Padilla said.


``In all these years, I thought that as long as I was alive, as long as I continued to breathe, I must continue to hope,'' she said.

To contact the reporter on this story: Helen Murphy in Bogota at
Last Updated: July 4, 2008 00:01 EDT

Thursday, July 3, 2008

Oil and Gas in focus: PDVSA Q1 profit rises 80% to usd $3.5 billion

PDVSA 1st quarter net profit shot up 80%, to usd $3.5 billion, up from usd $ 1.92 billion in the same quarter of 2007.

Although PDVSA's actual real performance might be difficult to predict due to various news agencies and the respective bias they carry when reporting on anything Venezuelan, PDVSA hard figures suggest some hope that Chavez is re-building Venezuela's delapidated and crumbling oil sector.

I am not down on the ground in Venezuela, but from the different Venezuelan-American's i've met, most claim any news they hear from their family and friends in Venezuela is highly bais depending on the individuals political ideology (pro-Chavez or anti-Chavez).

With this in mind I will include te major figures released by PDVSA today, and reported by Business News Americas (BNAmericas). To access the full article from BNAmericas click here.

-- Net profit: rose 80% ---> usd $3.5 billion from 1.92 bilion in 1Q07
-- Total revenue: rose 52% ---> usd $31.4 billion from 20.7 billion in 1Q07
-- Ebitda: rose 85% ---> usd $ 33.3 billion from 19.7 billion in 1Q07

-- Total costs: rose 38% to usd $24.3 billion from 17.6 billion in 1Q07

-- Revenues dedicated to social spending: up a whopping 376% to usd $2.68 billion from $565 million in 1Q07
-- PDVSA total contribtion to Venezuelan state: rose 112% to usd $7.39 billion from 3.48 billion in 1Q07

-- PDVSA oil production: rose 2% to 3.21 mb/d compared with 3.11 mb/d in 1Q07
-- PDVSA natural gas production: fell by 5% to 6.41Bf3/ d (181mm3/ d) compared with 6.73Bf3/ d in 1Q07

***NOTE *** the International Energy Association estimates Venezuela's production is actually close to 2.5 mb/d. Chavez did fire large numbers of workers in the oil sector whom he felt where not supporting his "Boliviaran Revolution." He also soon came to see them as a potential threat, lush with power and money from working in the oil sector, international connections, etc. He fired them all when he took a tough position during the country wide protests which paralyzed the country for about a year. When it was over, 1000's of PDVSA and other workers from the oil the sector found their traditional economic and political power was not able to dictate terms in Venezuela, and as they continued to push they found themselves jobless. 100's of Venezuelan's left to Texas, Miami, the Middle East in search of work in the oil sector abroad.

-- PSVSA recieved an average of usd $87.89/ barrel for exported crude, up 81% from $48.65/ barrel in 1Q07

-- PDVSA exploraton activities: focused on 23 exploration projects with the principle objective of investigation and confirming new reserves.

Colombian presidential candidate- Ingrid Betancourt. Kidnapped in 2002 is rescued from the FARC with 14 others

Betancourt is freed in Colombia --

Reuters update 1

"Betancourt was among 15 captives rescued from leftist guerrillas by Colombian troops posing as aid workers. A pale, but smiling Betancourt landed at Catan military base outside Bogota. Dressed in black pants and a camouflage vest, she descended the stairs of hte plane and hugged her mother, Yoland Pulecio who was waiting on the runway"

Reuters update 2

"The children of released hostage Ingrid Betancourt prepare to meet their mother after receiving news of her release."

"After talking to the media at the Elysee Palace in Paris with French President Nicolas Sarkozy, the children headed to an army airport with Foreign Affairs Minister Bernard Kouchner. "

Tuesday, July 1, 2008

Will the global credit crisis, surging commodity prices and a year many natural disasters... stop or slow the Chinese economy?

2008 was supposed to be a good year for China... supposed to be is key here. The Chinese had hoped the 2008 Olympic games, coupled with the incredible growth of Beijing would shock and awe the world.

Instead, the China has:

a) Been plagued by natural disasters this entire year. Snow, Earthquakes and now continued flooding (see Reuters video below).

b) Had to cope with protests over Tibet and efforts by some to convince the world to "boycott" the Olympic games.

c) Financial markets, including the Shanghai, Shenzhen and Hong Kong stock exchanges have retreated about 50% from their highs back in fall of 2007.

It will take time for the Chinese economy to recover, but the games offer some hope... The question will be whether or not the US economy more importantly, and Europe which is on the verge of a similar economic contagion, can recover.

North America and Western Europe still lead the emerging world in global economic influence. Even if China achieves a growth rate of 8-9%, which is very likely even in the wake of all these problems, in the long term China and other emerging markets will need to see the US and Europe recover.

Monday, June 30, 2008

Peruvian miners begin nation wide strike June 30---- Petrobas to set Orinco Policy---- Brazil and Venezuela hold fourth bilateral meeting

Apologies work and assignments have kept me busy today. Little time or brain power to give you my analysis today of articles I think relevant to discuss. I will however include some pieces which grabbed my attention from the news I read through today.

Peru Mine Workers Begin National Strike for More Pay (Update2)
-- Bloomberg LP

By Alex Emery

June 30 (Bloomberg) -- Peruvian mine workers began their third national strike for better pay and benefits in less than 14 months, adding to protests from Mexico to Chile that have disrupted copper supplies and sent prices to records this year.

Miners walked off the job at more than a dozen sites to pressure Congress to pass laws to increase their share of profit and improve pensions, said Luis Castillo, general secretary of the Mining Federation. The group represents about 28,000 mine workers and 70 unions.

``The strike is on across the country and will take several days to solve,'' Castillo said today in an interview from Lima. ``Talks with the congressional committee should get under way tomorrow.''

Strikes have cut copper output in Peru, Chile and Mexico, helping fuel a 28 percent rally in the price of the metal this year. Copper has climbed fivefold in the past five years as rising demand outpaced production, eroding global stockpiles. Peru is the world's largest silver producer and the third-biggest source of copper, zinc and tin.

Also joining the strike were unions representing workers at mines run by Barrick Gold Corp., Southern Copper Corp., Renco Group Inc.'s Doe Run Peru unit, Shougang Corp.'s Hierroperu iron unit, Cia. de Minas Buenaventura SA, Cia. Minera Antamina and Volcan Cia. Minera SA, the Mining Federation said.

``The strike has had a visible impact at the mine,'' Shougang Deputy Manager Raul Vera said in a telephone interview. ``But the strike isn't 100 percent, as some employees have gone to work.''


Southern Copper's Ilo smelter and Cuajone mine are operating with subcontracted workers and have not had any ``significant'' output losses, Southern Copper spokesman Alberto Giles said in an e-mail. Toquepala mine workers didn't join the strike, he said.

Doe Run Peru's La Oroya zinc and lead smelter is operating normally, spokesman Victor Belaunde said in by telephone. Employees at Barrick's Alto Chicama and Pierina gold mines also turned up to work ``as normal,'' spokesman Vincent Borg said in a telephone interview.

Antamina spokesman Jose Salazar declined to comment.

Congress will vote this week on a law that seeks to eliminate a ceiling on workers' share of profit, Peru's Labor Minister Mario Pasco said. Workers' bonuses based on profit currently can't exceed 18 times their monthly salary.

``There's no reason for this strike,'' Pasco told reporters in Lima today. ``In a week, more or less, this law will pass.''


Copper futures for September delivery rose 0.45 cent, or 0.1 percent, to $3.8825 a pound on the Comex division of the New York Mercantile Exchange.

Gold futures for August delivery fell $3, or 0.3 percent, to $928.30 an ounce, while zinc rose $2, or 0.1 percent, to $1,932 a metric ton on the London Metal Exchange.

Peru's Mining Federation held five-day national strikes in November and May of last year. In Chile, contract workers on May 5 called off an almost three-week strike that cost Codelco, the world's biggest producer, an estimated $400 million in lost output and damages.

Mexico's largest mining union is scheduled to vote today on whether to strike to protest the labor secretary's refusal to recognize the re-election of Napoleon Gomez Urrutia as the group's general secretary.

A strike has shut down Grupo Mexico's Cananea copper mine in Mexico since July 30. Grupo Mexico is seeking to buy the workers out and reopen the mine in 2009.

Government Solution

Congress, not the companies, will have to act to solve the dispute in Peru, Buenaventura Chief Financial Officer Carlos Galvez said.

``This is a political issue that has made the federation more visible,'' Galvez said in a telephone interview. ``It's likely there will be more mining operations on strike this time than last year.''

Peruvian lawmakers have been debating legislation since 2006 that would boost profit-sharing and pensions for miners. Peruvian President Alan Garcia last week enacted a law granting more rights to employees of contractors.

To contact the reporter on the story: Alex Emery in Lima at

Last Updated: June 30, 2008 17:23 EDT


Petrobras to set Orinoco policy in September - Brazil, Venezuela

Click here to view full article -- BNAmericas

Brazil's federal energy company Petrobras (NYSE: PBR) will define its role in Venezuela's Orinoco heavy crude belt at the September meeting between the two countries, Venezuela's state oil company PDVSA said in a statement.

Brazil's President Luiz Inacio Lula da Silva met his Venezuelan counterpart Hugo Chávez in June in Caracas for the fourth bilateral meeting.

Lula said that both PDVSA and Petrobras would take their time to cement any joint participation.

"These are both large and very powerful oil companies that are currently establishing common denominators that will guarantee a strong participation between the two companies," Lula said.

"The more oil we find, the more powerful we will become," he said in the statement.

Sunday, June 29, 2008

ING Launches Latin American Equity fund for Indian Investors -- Opened on June 19th and will remain open for potential buyers for about 1 month

China-Peru begin 4th Round of Negotiations for a Free Trade Agreement

China - Peru, 4th Round of Negotiations for a Free Trade Agreement between China and Peru began yesterday, June 28th in Lima, Peru according to Andina, a leading Peruvian news agency.

Topics on the agenda in this round include:

- Access to the Market,
- Rules of Origin,
- Trade Defense,
- Services,
- Investments,
- Sanitary and Fitosanitary Measures;
- Technical Obstacle to Trade,
- Solutions of Controversies,
- Customs Procedures
- Institutional Affairs.

Updates and developments to come. It seems both China and Peru are eager to sign this agreement. It would make it China's second in South America, Chile having already sealed a FTA with China back in 2005. (Click here to read the article published by the China-Daily, back in 2005)

Peru and Chile are attractive countries for China because of a variety of reasons. First, Peru and Chile are the world's leading copper producers. In 2004, the two nations, together mined nearly 6.4 million tonnes of copper; equal to 44% of global copper production. Together, the two countries accounted for 50% of China's total copper imports from abroad (International Copper - World Copper Study Group; 2007). Chinese copper demand is unlikely to shrink any time soon, granted the fact copper is used in the production of semi-conductors, automobiles, infrastructure, IT hardware, and in the construction industry (Trinh; 2006).

Second, macroeconomic and political stability and impressive growth makes Peru and Chile ideal entrance gates for Chinese investments, exports and imports to and from Latin America. Chinese ambassador to Peru, Gao Zhengyue, stated this year at a conference on pacific cooperation hosted in Lima; “one of the advantages that Peru (and Chile) offers to China as economic partners is its strategic economic convergence of complimentary economic structures. Derived from its geographical position in the continent, as a bridge between Asia and South America and the Atlantic Ocean through the bio-oceanic corridor. Peru is also important due to its projection towards a sub regional extended market through the Andean Community (CAN) and Mercosur. (China-Peru Free Trade Agreement Joint Feasibility Study; 2005-06).”

It would be nice is China and Peru could get this deal sealed and further increase trade with one another. It will be to the benefit of both countries. Reported on Chinese Governments homepage of the Ministry of Commerce, Vice Minister of Commerce Yi Xiaozhun stated:

"Peru is now China’s important trade and investment partner in Latin America. The China-Peru bilateral trade surged by 49.59% year on year to US$6.014 billion, out of which China’s export hit US$1.678 billion, up by 66.43%, and China’s import hit US$4.336 billion, up by 49.03%. The cooperation on mutual investment, contract projects and labor cooperation, etc., between the two countries also enjoys relatively quick development."

Many would agree other countries are equally or of greater significance to China... Such as the closest competitor to Peruvian copper--Chile. Perhaps Brazil, which China has become increasingly dependent upon for foodstuffs and is has also heavily invested in infrastructure, iron ore and energy projects throughout Brazil.

No less, Chinese rhetoric however exaggerated, does offer some evidence to suggest the agreement will pass and be speedily implemented. China can be very respectful, gracious and giving when they want something to move ahead. Whether Peru is truly emerging as China's most "important" partner in Latin America is questionable, but China's and the Peruvian governments efforts to move this foward, show both parties feelthe FTA would be beneficial.

ProInversion board to okay Pisco-Lurin pipline contract -- investment opportunities in Peru!

BNAmerica's reports ProInversion, Peru's state agency for promoting private investment is due to release purchasable contracts to private investors willing to buy them.

Grana y Montero, a local Peruvian company and Oiltanking, a German firm will construct a 300km from the province of Pisco to a dispatch plant in Lurin, which is within the district of Lima. Construction of the pipeline will take approximately 30 months once all financing is approved.

I learned today through researching this particular "investment," ProInversion allows private investors to invest in numerous infrastructure and state projects of the Peruvian state. Although the English site is a little vague on how the investment works, it is interesting to see such a site exists and that the Peruvian state has managed to package the debt of such products into purchasable and tradable forms.

Investors, seeking a alternative avenue to diversify their investment should consider such investments. ETF's and mutual funds, or even direct purchase of equity is risky considering the current state of the global economy and the world's financial markets.

I am sure many situations from the past can be pointed out by others who are aware of them of times when Latin American government have issues similar "bonds" or purchasable equity to finance their own projects... only to never pay their investors back. People have good reason to be worried, but ask yourself... in today's market, what investment comes with "no worries?"

Video -- Investing in Peru

Flooding continues in Southern China as new tropical storm hits South China

Local residents are trapped in floods in Heyuan city, south China's Guangdong province, June 27, 2008. (Xinhua Photo)

Armed police transfer trapped residents in Heyuan city, south China's Guangdong province, June 27, 2008. Affected by Typhoon Fengshen, heavy rainfall hit Heyuan on Thursday and Friday, flooding some roads and houses. Over 2,000 local residents have been transferred to safe places by the armed police.(Xinhua Photo)

Reuters Video Footage - China Flooded by tropical storm

The Shanghai Stock Exchange unveil's new rules intended to prevent investor fraud and manipulation of securities

New rules unveiled by the Shanghai Stock Exchange summarized below... Or view the full story on Xinhua's website, accessible here.

Proceeds from initial public offerings (IPO), private placements and bond sales should be put in an account opened by the board of directors, the rules said.

Listed firms should notify underwriters if they want to cash in more than 50 million yuan (7.3 million U.S. dollars), or at least 20 percent of the proceeds, from an account, the bourse said.

The proceeds should not be used to buy tradable financial assets or lent to others. It is also banned from being invested in stock funds or in companies mainly engaging in buying and selling securities.