World Bank discusses investing in Africa with China Investment Fund

BEIJING -- World Bank President Robert Zoellick said he is talking to Chinese government officials about cooperating on investments in Africa, which he said could help boost the continent's economic growth.

Mr. Zoellick told reporters Wednesday during a visit to the Chinese capital that China Investment Corp., the nation's sovereign-wealth fund, has expressed interest in investing in the World Bank's recently launched asset management company, which invests private-sector funds into places like sub-Saharan Africa and Latin America.

World Bank President Robert Zoellick
On Wed, stated he will press Group of 20
for more aid to developing countries [WSJ]

"CIC expressed interest in this as a commercial investment vehicle, but obviously there is no decision yet on their part," Mr. Zoellick said. Other sovereign-wealth funds and pension funds are also interested in the new investment vehicle, he said, which manages some $4 billion in funds.

Click here to read J.R. Wu and Andrew Batson's complete article at the WSJ

Argentina could potentially attract $10 billion to its stock market if restrictions are lifted, reports Bloomberg

Argentina’s stock exchange called on the government to lift capital controls that caused it to become the only major Latin America market classified as “frontier,” adding the move may help lure $10 billion in foreign investment.

A requirement for international investors to deposit 30 percent of what they put in Argentina with the central bank for a year “have stopped making sense,” Adelmo Gabbi, the Buenos Aires stock exchange’s chairman, said yesterday in a speech.

Capital controls prompted MSCI Inc. to remove Argentina from its benchmark emerging-market index in June, assigning it the so-called frontier status along with the world’s least developed markets. The controls have helped Argentina avoid volatility, said President Cristina Fernandez de Kirchner.

Argentina's stock exchange, Buenos Aires
Image courtesy of Business Week

“We have to seek a rule so that the inflow of funds won’t be speculative,” she said, without elaborating.

...

“The deposit requirement was imposed in 2005 and was one of the forces that allowed us to confront the brutal volatility of the markets during the crisis,” Fernandez responded yesterday in a speech at the Buenos Aires stock exchange.

Fernandez’s husband and predecessor Nestor Kirchner imposed deposit requirement in order to discourage speculators from investing in local markets after the country restructured about $104 billion in bonds...

Click here to access the full article from Bloomberg

China becomes L America's privileged partner: ECLAC official

Xinhua news reports,

China has become a "privileged partner of Latin America," and the region needs to define a joint strategy to develop its ties with China, an official of the Economic Commission for Latin America and the Caribbean (ECLAC) said Wednesday.

The "post- (economic) crisis will find a bigger and more important China than the one it has been in the world economy," said Osvaldo Rosales, ECLAC's director for international trade and integration.

Citing the World Trade Organization's report on Tuesday that China had displaced Germany in the first half of 2009 as a leading exporter, Rosales observed that "this has been reflected in its (China's) growing relative presence in the world's trade, mainly in Latin America."
"The numbers of destinations and exporters show that China has become a privileged partner of Latin America," Rosales told Xinhua in an interview.

This was because the Chinese government had "already defined the strategy for Latin America in its white book," Rosales explained, adding that the region needed to do the same.

Regarding bilateral trade relations, Rosales worried about Latin America's export structure, which focused on a few products and natural resources. He called for a diversification of the export basket.

"Latin America is in some ways linked with China, the world economy's engine of the 21st century, but it is doing that with an export structure from the 20th century," Rosales observed.

Click here to read the full story from Xinhua

Argentina-Uruguay friendly goes bad...

South-South Cooperation at its umm... worst

Newswire: Latin America

Latinamerica foreign trade forecasted to contract 9 to 11% in 2009
The main impact for Latinamerica of the global financial crisis and economic slowdown has been the contraction of trade, so far in the range of 9 to 11%, revealed Alicia Bárcena, Executive Secretary of the UN Economic Commission for Latinamerica and the Caribbean, Cepal.

“The strongest impact we are seeing in the region is the fall in trade volumes. I believe that the “shock” of the contraction of global demand for our goods and services is our most relevant issue”, said Bárcena in an interview with the Cuban daily Granma.

She recalled that when the last big crisis Latinamerica’s foreign debt was equivalent to 24% of GDP, while in 2008 it had dropped to 8%.


Latinamerican Liberals hold congress in “Bolivarian” Venezuela
Liberal political parties and thinkers from Latinamerica are holding their annual congress this week in the Venezuelan capital Caracas. The event is in the framework of the 25th anniversary of the local branch Cedice-Libertad and will promote debates on liberal policies to address poverty and the current global slowdown.

...

The congress is bound to spark some reaction among President Chavez followers since his Bolivarian revolution and XXIst Socialism stand at the opposite end of the political spectrum from the Liberals and the concept of individual freedom.

The two events will be taking place during a particularly sensitive week since President Chavez has ordered the nationalization of oil industry subcontractors, banks, steel industry, food processors and farm land considered idle.


Foreign direct investment to Latam reached 139 billion USD in 2008
Direct foreign investments in Latinamerica and the Caribbean are showing a significant resistance to the global crisis and in 2008 reached a record 139 billion US dollars, up 9.4% from the previous year according the United Nations Conference on Trade and Development.


Latinamerica’s bicentennial independence festivities begin in Bolivia
Bolivia’s commemoration on Monday May 25th of the 200th anniversary of the first uprising in Latinamerica against the Spanish colonial empire will also mark the beginning of similar independence celebrations along the continent which will peak in 2010.


Third re-election running “inappropriate” admits Colombia’s Uribe
Colombia’s President Alvaro Uribe says it would be “inappropriate” for him to seek a third consecutive term. His statement comes two days after the Senate approved a referendum that would ask voters to permit him to run again. Uribe did not, however, clearly rule out a re-election bid.

Latin American fence mending - Reuters Video

Apr. 13 (Reuters) - President Obama heads south as part of an effort to establish a new relationship with Latin America.

Cuba's welcomes talk with U.S. -- Reuters Video

Apr 7 - Fidel Castro praises U.S. efforts to normalize relations, as U.S. politicians continue their visit to the island.

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.

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.

Good weekend reading: South-South Cooperation in Latin America and the Caribbean, ways ahead following Accra

This 6-page Spanish document aims to analyze the opportunities and challenges of South-South cooperation in Latin America and the Caribbean.

South-South Cooperation in Latin America and the Caribbean: Ways Ahead from Accra

Below I have copy and pasted the opening of the document. Click the link above to download the PDF to your desktop. It's only 6 pages and not a bad read. Enjoy.

South-South cooperation has gained prominence in global development policies as a result of its inclusion in the Accra Agenda for Action, the September 2008 agreement which reinforces the aid effectiveness principles of the Paris Declaration. This opens up an important forum for encouraging South-South cooperation as a mechanism for horizontal learning and for promoting the development of national capacities. However, strengthening South-South cooperation at the conceptual and operational levels still poses major challenges, as does improving the measurement of its scale and impact.

Looking to the new task team on South-South Cooperation within the Working Group on Aid Effectiveness (WP-EFF), the following pages aim to analyze the opportunities and challenges of South-South cooperation in Latin America and the Caribbean. As a region containing countries with numerous similarities in their political and institutional history and patterns of social and economic development, Latin America and the Caribbean constitutes a privileged environment where a number of shared agendas are already evolving. However, the operationalisation of South-South cooperation within the framework of the Accra Agenda for Action and the Paris Declaration also faces a series of specific circumstances1 that future political decisions and analytical work need to address in concrete ways.

The ideas expressed in this document stem from the joint reflections of two researchers from the Colombian organization Enlaza and the European think tank FRIDE, respectively. The analysis has benefit ted particularly from bilateral talks with Latin American and European experts over the past three months, on the one hand, and a workshop held on 6 March 2009 in Bogota, on the other. Both authors wish to express their deep gratitude to all interviewees for sharing their vision on South-South cooperation, which is increasingly important to Latin America and the Caribbean.

María Clara Sanín Betancourt, Nils-Sjard Schulz of FRIDA
-- Fundación para las Relaciones Internacionales y el Diálogo Exterior

About FRIDE
FRIDE is a think tank based in Madrid that aims to provide the best and most innovative thinking on Europe’s role in the international arena. It strives to break new ground in its core research interests of peace and security, human rights, democracy promotion, and development and humanitarian aid, and mould debate in governmental and non-governmental bodies through rigorous analysis, rooted in the values of justice, equality and democracy.

FRIDE seeks to provide fresh and innovative thinking on Europe’s role on the international stage. As a prominent European think tank, FRIDE benefits from political independence, diversity of views and the intellectual background of its international staff.

The Latin American zinc association (Latiza)

I didn't even realize this organization existed until I stumbled upon a interesting "in depth" piece that BNAmerica's did on it.

The Latin American Zinc Association (Latiza) is a regional branch of the International Zinc Association, which comprises both zinc producers, miners and refiners. Latin America, if you did not know produces roughly 23% of the global output of zinc, a very commonly used base metal.

If you're interested in learning more about Latiza and can read Spanish you should definitely check out their home page at:

http://www.latiza.com/primero.html

What the news is reporting on Obama lifting some travel restrictions to Cuba

New US law eases Cuba sanctions -- BBC

Cuban-Americans will be allowed to travel to the island once a year and send more money to relatives there.

Curbs on sending medicines and food have also been eased.

The legislation was earlier approved by the Senate after clearing the House of Representatives last month.

The legislation overturns rules imposed by the Bush administration which limited travel to just two weeks every three years, and confined visits to immediate family members.

Havana, Cuba

U.S. loosens restrictions regarding Cuba -- CNN International

Cubans applaud U.S. bill easing trade, travel -- Reuters

Cuba travel moves fall short of Obama pledge: group -- Reuters

Despite bill, Cuba trade rules mostly unchanged: Geithner -- AP

Showdown on U.S.-Cuba policy not over yet -- Miami Herald

Geithner Pledges Limits on Expansion of Cuba Travel (Update1) -- Bloomberg

Venezuela Launches Joint Venture to Develop Offshore Gas Fields

CARACAS – Venezuelan state energy company PDVSA announced the signing of a multi-billion-dollar joint venture with Portuguese, Argentine, U.S. and Japanese firms to develop massive offshore natural gas fields.

The venture, in which PDVSA will have a majority stake, will design, build and operate two liquefaction plants at the Gran Mariscal de Ayacucho gas industrial complex in the northeastern state of Sucre, as well as pipelines to transport the fuel to those facilities.

Click here to access this full article from the Latin American Herald

Chinese leaders' Latin American tours boost bilateral strategic co-op

BUENOS AIRES, March 6 (Xinhua) -- Some Latin American diplomats and scholars have spoken highly of Chinese leaders' recent tour of the region, saying their visits will boost the strategic cooperation between China and the Latin American countries.

Chinese Vice President Xi Jinping and Vice Premier Hui Liangyu paid separate official visits to Latin America countries in February, the beginning of the Chinese lunar new year.

China Town, Buenos Aires

The Chinese leaders' visits to the region are of great significance to promote China-Latin America relations, said Gustavo Gerardo, chairman of the Asia-Argentina Association.

As a major trade and investment power, China is playing an increasingly important role in the global economy, he said.

The Chinese and Latin American economies are highly complementary to each other. Primary products produced by Latin American countries for export to China help maintain China's economic stability and growth. Meanwhile, China's investment and commodities have strong appeal to Latin American countries, he added.

Click here to access more on this topic from Xinhua News Agency

South-South Cooperation in focus: Chinese Vice President: Sino-Latin American Cooperation Shows Promising Future

Visiting Chinese Vice President Xi Jinping says cooperation between China and Latin America has a promising future and both sides will step up further cooperation.

Xi Jinping made the statements during his visit to Brazil.

"As the world's largest developing country, China will step-up all-round and mutually beneficial cooperation with Latin America, the most important developing region, to a higher level. Sino-Latin American cooperation has a promising future."

Xi Jinping notes that his Latin America tour has been fruitful.

"During these Latin America visits, I've held talks with some leaders on how to enhance our cooperation and bilateral relations under a new international situation. We have also attended various signing ceremonies on a range of cooperation projects."

During his visit to Brazil, Xi Jinping met with Brazilian president Luiz Inacio Lula da Silva and Foreign Minister Celso Amorim about deepening strategic partnerships.

Click here to listen to Xi Jinping's statement

China-South America -- China pursues Latin America ties -- BBC Article

Two top Chinese officials have started visits to Latin America as part of an intensified effort to strengthen ties with the region.

Chinese Vice-Premier Hui Liangyu is to visit Argentina, Ecuador, Barbados and the Bahamas.

Vice-President Xi Jinping is visiting Jamaica, Colombia, Venezuela and China's two biggest trading partners in the region, Brazil and Mexico.

Click here to access the full article from BBC

Official foreign tours by China's top leaders to Africa, Middle East, Latin America and Europe highlight “confidence, friendship and cooperation.”

Top officials from the Chinese government have been busy visiting or preparing for trips to Africa, the Middle East, Latin America and Europe.

Premier Wen Jiaobao latest European trip has boosted confidence in the two regions joint efforts at tackling the global financial crisis, reported Xinhua today.

Chinese Preisdent Hu Jintao will visit Saudi Arabia, Mali, Senegal, Tanzania and Mautitius from Feb 10th to Feb 17th.

Vice President Xi Jinping left yesterday on Sunday to meet Vice Premier Hui Liangyu (below) for his own official visits to Mexico, Jamaica, Colombia, Venezuela, Brazil and Malta.

Chinese Vice Premier Hui Liangyu (2nd L) is greeted upon his arrival in
Buenos Aires, Argentina, on Feb. 8, 2009.(Xinhua/Martin Zabala)

Jia Qingguo, associate dean of the School of International Studies at Peking University, told the Beijing-based Global Times newspaper that “the international community expects China's greater involvement in international affairs and a greater international responsibility for China.”

On the other hand, "it signifies that China is placing a greater emphasis on cooperation with the rest of the world, which has an important bearing on our own interests," Jia said.

Chinese Vice Premier Hui Liangyu (L) is greeted upon his arrival in
Buenos Aires, Argentina, on Feb. 8, 2009. (Xinhua/Martin Zabala)

Emerging Markets' Presence Grows at Davos Economic Forum -- Bloomberg

Jan. 29 (Bloomberg) -- Emerging markets are gaining attention at the
World Economic Forum in Davos, Switzerland, as developed nations flounder and seek a solution to the global financial crisis.

The financial meltdown has undermined western-style capitalism as an economic model, leading some to question whether emerging markets are willing to listen follow western advice for their economic development as they did in the 1990s. (Source: Bloomberg)

For more Bloombergcoverage from Davos see http://www.bloomberg.com

FT Commentary -- How are frozen credit markets and the global slowdown being felt down in South America?

Stephen Fidler put together a great piece on January 8th where he presents various perspectives and analysis from South America on how the global crisis is affecting the region.

Across the continent, the crisis has brought about a large-scale destruction of wealth. Claudio Loser, a former western hemisphere chief at the International Monetary Fund, calculates that 40 per cent of Latin America’s financial wealth was wiped out in the first 11 months of 2008 through falls in stock and other asset markets and currency depreciation. That $2,200bn (£1,440bn, €1,610bn) loss alone could cut domestic spending by 5 per cent next year, he estimates.

On top of that, flows of credit from abroad have contracted sharply and the region, much of which depends on exporting raw materials, has been pummeled by a collapse in commodities prices. The deterioration in Latin America’s terms of trade – the price of exports divided by the price of imports – could hit even harder than the credit crisis, says Mr Loser, now with the Inter-American Dialogue, a Washington think-tank. “The fact that the terms of trade have gone so far against the Latin American economies in terms of agriculture, minerals and petroleum is really going to hit the region very hard,” he says.

Click here to access the full article from the Financial Times

South America News in Focus -- Brazil, Ecuador and Chile

Articles collected from Bloomberg LP

Brazil --

Lula May Increase Brazil's Oil Take as Tupi Spurs Rules Review
By Jeb Blount

July 9 (Bloomberg) -- Brazilian President Luiz Inacio Lula da Silva (photo on the right) may boost the government's stake in oil fields after the largest discovery in the Americas since 1976 prompted a review of rules for how petroleum deposits are developed.

Lula is examining how Brazil and producers will share revenue from offshore deposits that may hold more than $6 trillion of oil at current prices. Lula said the Tupi discovery and nearby prospects will at least triple Brazil's crude reserves, and he wants the wealth to be shared nationwide.

``This oil is ours, it belongs to the people, not Petrobras or Shell,'' Lula said in a June 26 interview in Brasilia, referring to state-controlled Petroleo Brasileiro SA and Royal Dutch Shell Plc of The Hague. ``The wealth is not for the few, it's for the many.'' ....................

Click here to read the full story at Bloomberg LP


Brazil May Take Other Measures to Curb Inflation (Update1)
By Adriana Brasileiro and Carla Simoes

July 9 (Bloomberg) -- Brazil will take ``all necessary measures'' to curb inflation that's accelerating faster than the government forecast, Planning and Budget Minister Paulo Bernardo said.

``Saying that nobody in the government is worried about inflation is an exaggeration,'' Bernardo said in a Bloomberg Television interview in Brasilia today. ``But we don't see any reason for panic. The government has

..........................

Inflation as measured by the IPCA-15 index accelerated to 0.9 percent increase in the month through June 15, the fastest in four years, from a 0.56 percent rise in the previous month. The increase exceeded all estimates in a Bloomberg survey that forecast a 0.78 percent rise.......................

Click here to read the full story at Bloomberg LP


Ecuador --

Ecuador's Dollar Bonds Rebound as Salgado Eases Default Concern
By Lester Pimentel

July 9 (Bloomberg) -- Ecuador's bonds rose, rebounding from their biggest rout in almost a year, after new Finance Minister Wilma Salgado said the government will keep paying its debt.

The extra yield investors demand to own Ecuador's debt rather than U.S. Treasuries narrowed 12 basis points, or 0.12 percentage point, to 6.53 percentage points at 10:04 a.m. in New York, according to JPMorgan Chase & Co.'s EMBI Plus index. The so-called spread surged 54 basis points yesterday, the most since Aug. 16. ........................

..................

The yield on Ecuador's 10 percent bonds maturing in 2030 fell 13 basis points to 10.71 percent, according to JPMorgan. The bond's price gained 1 cent to 94 cents on the dollar.

Click here to read the full story at Bloomberg LP

Chile --

Chile Economists Lift 2008 Inflation Forecast to 7.5% (Update1) By Sebastian Boyd

July 9 (Bloomberg) -- Chilean economists raised their inflation forecast for this year by 2 percentage points, a central bank survey of economists showed.

Consumer prices will rise 7.5 percent this year, according to the median estimate of 36 economists in a survey carried out between July 2 and July 8. Economists had expected 5.5 percent inflation in last month's survey.

.....................

Chile's central bank aims for inflation expectations inside its target range of between 2 percent and 4 percent over a two- year horizon. The median estimate of 31 economists in this month's survey was for inflation of 3.8 percent in June 2009. ..........................

Click here to read the full story on Bloomberg LP