Friday, April 3, 2009

Bloomberg News Wire -- International Relations, G20, Asia, Latin America, Commodoties, Emerging Markets, Equities and the crazy lady in Argentina


April 3 (Bloomberg) -- Global leaders took their biggest steps yet toward a new world order that’s less U.S.-centric with a more heavily regulated financial industry and a greater role for international institutions and emerging markets.

At the end of a summit in London, policy makers from the Group of 20 yesterday delivered a regulatory blueprint that French President Nicholas Sarkozy said turned the page on the Anglo-Saxon model of free markets by placing stricter limits on hedge funds and other financiers. The leaders also pledged to triple the resources of the International Monetary Fund and to hand China and other developing economies a greater say in the management of the world economy.


Emerging-Market Bond Sales Surge to Two-Year High (Update1)

April 3 (Bloomberg) -- Emerging-market governments and companies borrowed more in international bond markets this week than at any time in the past two years as interest costs plunged on optimism the worst of the global recession may be over.


China GDP Growth May Quicken to 10% by Year End, Nomura Says

April 3 (Bloomberg) -- China’s economy may grow as much as 10 percent by the final quarter of this year as the government’s 4 trillion yuan stimulus package ($585 billion) takes effect, Nomura Holdings Inc. said.

“An investment boom led by the government’s stimulus package and a very low growth rate in the fourth quarter of 2008 may push growth to rebound to around 10 percent” by the fourth quarter of 2009, Sun Mingchun, an economist at Nomura in Hong Kong, said yesterday. The economy grew 6.8 percent in the fourth quarter of 2008.


April 2 (Bloomberg) -- Venezuelan President Hugo Chavez said he’ll seek investment agreements this week during a trip to Japan and China to secure financing for oil projects in the South American country.

Chavez is making stops in Asia and the Middle East to deepen economic ties after a plunge in oil prices forced him to cut government spending last month. He met yesterday with Iranian President Mahmoud Ahmadinejad to inaugurate a joint development bank


Kirchner Restates Argentina’s Claim to Falklands, AFP Reports

April 3 (Bloomberg) -- Argentine President Cristina Fernandez de Kirchner reiterated her country’s claim to the Falkland Islands and called on the U.K. to renew talks on their sovereignty, Agence France-Presse rep

... is this woman smoking crack? Didn't Argentina learn that you do not mess with the British, they ruled the friggin world for nearly two centuries.


First Ladies of the G-20 -- Watch out Gentlemen, these ladies don't mess around

First ladies from the countries participating the G20 Summit pose for a photo in London on April 2, 2009. Leaders from the Group of 20 developed and emerging economies are in London discussing global solutions to the financial and economic crisis. (Photo:

Wednesday, April 1, 2009

OZ agrees to sell to Minerals - Reuters Video

Apr 1 - China's state owned Minerals agrees to pay $1.21 billion for most of Australian miner OZ Minerals' assets on Wednesday.

Australian miner OZ Minerals sells most of its assets to Chinese firm Minerals for 1.21 billion dollars as the world's No.3 economy continues its commodities acquisition overseas.

Kitty Bu of Reuters reports

Tuesday, March 31, 2009

Deutsche Bank sees hope in the commodity markets

The global head of Deutsche Bank's commodity unit, David Silbert, announced today the bank (Germany's largest bank by market share) will be expanding its commodity team by roughly 10% this year.

DB will be adding new assets of coal, European natural gas and shipping to its balance sheets.

DB has seen its revenue from commodities quadruple over past two years. The bank seems confident this trend can continue and that as global stimulus packages hit the market and the general global economic outlook improves, commodity demand will once again head north.

“With hope of an economic rebound, crude, base metals prices are going to be higher than now,” said Silbert.

Bloomberg does a pretty good job in this article of contrasting DB's strategy vs tha to Zurich-based UBS AG.

South-South Cooperation: Chile supports India as permanent member of UN Security Council - MercoPress

India and Chile reaffirmed their support for a comprehensive reform of the United Nations including expansion of the Security Council to make the world body more representative, legitimate and effective.

PM Manmohan Singh and visiting Chilean President Michelle Bachelet stressed and acknowledged the need for continued efforts by member states to ensure "meaningful and result-oriented intergovernmental negotiations".

Chilean President Michelle Bachelet with PM Manmohan Singh

The joint statement issued after the meeting said that Chile reiterated its support for India's permanent membership on an expanded UN Security Council. It also confirmed their reciprocal support for each other's candidature for non-permanent membership of the UN Security Council for 2011-12 (India) and 2014-15 (Chile).

Click here to access the complete article from MercoPress

South America - Arab League meet world at annual summit - MercoPress

The Arab League and South American countries will open Tuesday, their second summit with the purpose of boosting trade and cooperation. The idea of regular meetings between the 22 members of the Arab League and 12 South American countries was born in Brasilia in 2005, sponsored by Brazilian president Lula da Silva.

Although geographically very distant the two regions have long historic links in such areas as oil production (Venezuela and Saudi Arabia were five of the founding members of OPEC) and even migration: there’s a strong component of Arab descendants in South America. Sao Paulo for example is considered the second Syrian city of the world behind Damascus.

The purpose of the regular summits which includes government officials and business representatives is not only closer trade links, possibly some form of association, but also political, with strong cooperation in the international arena, according to Brazilian sources.

Click here to access the complete article from MercoPress

China's Minmetals makes a new offer for Australian miner OZ Minerals -- Reuters Video

Mar 31 - China's state-owned Minmetals made new offer for Australian miner OZ Minerals, as the world's No.3 economy continues its push for resource acquisitions.

China makes a new offer for Australian miner OZ Minerals excludes Prominent Hill while OZ hopes to seal debt extension by early Wednesday.

Kitty Bu of Reuters reports

Monday, March 30, 2009

Vice Prez, Joe Biden says "US moving towards new day in Latin America

La Nacion, a Buenos Aires based newspaper published a interesting op-ed piece today, which the Latin American Herald (access their article here).

Biden stressed the importance of the Progressive Governance conference which he is currently attending in Chile.

Joe Biden with a few South American heads of state

Biden also had the guts to acknowledge much like Hillary Clinton did in Mexico the other day that the United States must “do more” to reduce the demand for illegal drugs and stop the arms trade."

He congratulated “Mexico’s brave stand” against drug cartels and the “efforts” of Colombia to combat drugs, but warned that these “will have the secondary effect of pushing traffickers towards Central America.”

“The world economic crisis has affected almost everyone. Citizens of all countries are looking for answers, looking for hope, and for that they turn to their leaders. It is our duty, as partners, to listen to their plea and together forge the solution to a shared problem, explained Biden.”

China and Argentina Agree on Currency Swap --Update from IDB annual meeting in Colombia

March 30 (Bloomberg) -- The central banks of China and Argentina reached an agreement for a three-year, 70 billion yuan ($10 billion) currency swap, Chinese Central Bank Governor Zhou Xiaochuan told reporters in Medellin, Colombia, today.

It’s the first such accord between the world’s third- biggest economy and a Latin American nation. The move follows swap accords between China and Indonesia, South Korea, Hong Kong, Malaysia and Belarus.

The agreement broadens Argentina’s access to foreign- currency reserves and may ease concerns about the country’s ability to control the peso amid uncertainty over a conflict with farmers over export taxes and legislative elections scheduled for June 28. Argentina wasn’t part of a swap facility program created by the U.S. Federal Reserve for emerging markets, including Brazil and Mexico, last year.

Click here to access this full article from Bloomberg

Venezuela and Iran meet to discuss joint projects

The higher-ups of Venezuela and Iran's respective governments met in Caracas to go over a handful of planned joint-projects. The meeting was headed by the foreign ministers of Iran and Venezuela, Manouchehr Mottaki and Nicolás Maduro according to this report from the Latin American Herald.

Another issue which was discussed was the potential of the creation of a Venezuelan-Iranian Investment Fund. The ultimate goal of a such would be to promote the exchange of raw material for technology, technology projects, the construction of a cement factory, projects in the energy sphere and the construction of machinery plants which would produce tractor and other auto parts."

Chavez went one step further and explained “I’m going to Iran to continue fortifying relations with Iran, because among other things we’re installing the Iranian-Venezuelan bank."

For a country like Iran this sounds like a pretty sweet deal. After years of relative isolation from the global community and market place Iran has become pretty good at producing a variety of goods domestically. Exchanging the skills Iran developed over the years for economic and technological benefits from Venezuela is a great way to exploit your skills and services that are otherwise unwanted anywhere in the world outside of lawless Iraq.

For Venezuela on the other hand, increasing levels of economic, technological or political cooperation with a country like Iran can yield no net benefit. The world will only further ostracize Venezuela and demonize Hugo Chavez for this.

I feel for the innocent Venezuelans who where simply fun loving, baseball playing, oil exporting Latino's a few years back... Now Venezuelan friends of mine are canceling weddings and family reunions here in New York City because of either

a) their families have suddenly been denied visas or,

b) the new rules which limit the amount of cash Venezuelan's can take out of the country just SLIGHTLY hinder a expensive life event like a wedding.

For Venezuelan's this must hurt, especially considering until a decade ago securing a U.S visa for a Venezuelan was far easier than for a Peruvian, Ecuadorian Mexican or Salvadorian.

Green investment in Chile -- Irish firm to invest $1 billion in wind farms

Ireland's Mainstream Renewable Power has just announced plans to invest more than $1 billion in Chile over the next five years in the construction of wind farms, according to company CEO, Eddie O'Conner.

Mainstream Renewable Power will partner up with Andes Energy, Chilean energy company in order to lay the foundation for a system which will generate more than 400 MW of electricity.

O'Conner presented a report to the Chilean Energy Minister Marcelo Tokman this past Tuesday outlining how if certain strategies are implemented correctly it would be possible for Chile to achieve energy independence.

“Our research shows that Chile has the natural resources to develop 44,000 megawatts of wind energy and another 37,000 of solar energy. Renewable energy resources alone can turn Chile into an exporter of clean energies.” O’Connor said.

Latin America hopeful for more Chinese investment

The Governor of the People's Bank of China, Zhou Xiaochuan was in Colombia this weekend rubbing shoulders with the head honchos of Latin America's governments, intellectuals and business leaders.

Chinese Central Bank Governor Zhou Xiaochuan
attends the Inter-American Development Bank (IDB)
meeting in Medellin, Colombia, March 28, 2009.
(Xinhua/David De La Paz)

Most major media outlets from North America and Europe picked up Zhou's pledge that China would actively support the International Monetary Fund (IMF) and other multilateral lending organizations such as the Inter-American Development Bank (IDB).

This naturally means China will want a legitimate voice in these institutions. Hopefully a Chinese voice will be for the better, not worse. Giving the Chinese a shot after all the foul-ups with U.S led efforts in the IMF shouldn't be too much to ask.

After reading through comments and quotes from various media reports on Zhou's speech, the consensus is clear. China plans on continuing the promotion of South-South Cooperation between developing nations—and is particularity optimistic about the prospects which lie ahead in regard to Sino-Latin American cooperation..

“South-South cooperation is all the more important amid the current financial crisis, and China will expand its trade with and increase its investment in Latin American countries after it joined the IDB, he said.”

"We see huge potential for economic ties and trade between Latin America and China," he said, noting that China has a free-trade pact with Chile, has concluded negotiations for such a pact with Peru and could have one with Costa Rica.

"The potential for China to make foreign direct investment in the region is huge," he said, adding that some sectors of special interest are in pharmaceuticals, computer software, aeronautics and biological products.

Trade between China and the greater Latin American region has been growing at an average rate of 40% in recent years and hit a record high of $143.3 billion in 2008 according to Xinhua News Media.

Zhou was in Colombia attending the 50th annual meeting of the IDB, which it joined in January this year.

Reuters Business Feed

It was a good while it lasted... Copper falls from 5 month high

Copper prices rose to their highest in nearly five months on Friday, but slipped as doubts grew about the strength of real demand from manufacturers, particularly in China. Three-month copper on the London Metal Exchange traded at $3,995 a tonne in official rings, down from an earlier $4,168, the highest since Nov. 10. The metal used in power and construction closed at $4,085 a tonne on Thursday.

A major reason behind the price rise is the flow of copper to China, the world's largest consumer, in recent months. But analysts say most of it is heading for consumer or government stockpiles and does not mean real demand is picking up.

"We're still seeing Chinese buying...I'm assuming most of this buying is going into stockpiles at the moment," David Wilson, analyst at Societe Generale, said.

Click here to access this article in its entirety

Qatar Airways considering flights South America

The Gulf Times, one of the better English publications from the region in my opinion reported that Qatar Airways had expressed a "keen interest" in flying to a South American city. Emirates already flies to Sao Paulo, so Qatar Airways would be the second major carrier from the region to establish this new, strategic route.

Ibrahim Mohie El-Din a representative of the League of Arab States at the second Arab – South American Business Forum in Doha, explained that direct air links between the regions would boost bilateral trade. Easing visa restrictions would also enable businessmen and tourists to fly between these emerging blocks frequently.

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Sunday, March 29, 2009

Taiwan loosing ground in Latin America

The election of left-leaning Mauricio Funes in El Salvador is not about to cause the country to dismantle private property laws, retreat on free trade or any of the other major fears associated with left-wing politics.

Funes will however finally move El Salvador from Taiwan's speed-dial to that of the People's Republic of China (the Mainland).

Taiwan maintains official diplomatic relations with roughly 23 countries around the world, a good handful of which are in Central and South America. Taiwan has typically been able to maintain these relations thanks to "money diplomacy."

China may be a huge economy, but by and large it is still relatively poor and filling the void of billions of Taiwanese aid $'s hasn't been on the top of China's agenda, especially for the countries that have bananas to offer in terms of commodities (instead of metals or energy).

Experts seem to think Taiwan's best bet is to attempt to achieve some type of "dual recognition," meaning acknowledging the coexistence of both the PRC and the Republic of China on Taiwan. Making for "two Chinas" or "one China, one Taiwan" stance.

Hey Taiwan! I love you and think your country is a wonderful place and you have all the right to fight for what you believe... but common' get real.

As you can see in this previous post, when the PRC visits leaders in Africa and Latin America one of the first courteous gestures is to emphasize the given countries dedication to support the the PRC's "one China" policy.