Publish in Trade Talk - Wednesday, May 21, 2014
Brazil's construction and renovations of soccer stadiums have been delayed and faced cost overruns. Here Maracana in Rio de Janeiro. (Photo: Erica Ramalho/Copa2014)
World Cup, Happiness, Asia demand for perishables, Argentine issue.
BY LATINVEX STAFF
Latin America has become less competitive, according to the latest World Competitiveness Yearbook from Switzerland-based business school IMD.
The yearbook, which will be published at the end of June, measures how well countries manage all their resources and competencies to increase their prosperity. The overall ranking of 60 countries reflects more than 300 criteria, two-thirds of which are based on statistical indicators and one-third on an exclusive IMD survey of 4,300 international executives.
Brazil, Chile, Colombia, Mexico and Peru all fell on the ranking. Venezuela kept its dismal ranking (the world’s worst), while Argentina gained slightly.
Brazil, which saw its rank fall from 51 to 54th place, suffers from inefficient labor markets and ineffective business management, IMD says.
Mexico surprisingly fell from 32nd to 41st place despite the recent energy and telecommunications reforms. That means that Mexico lags countries like Russia in competitiveness, IMD says.
Chile, the most competitive country in Latin America, ranks in the bottom half at 31st place. Argentina went from 59th place last year to 58th place. That means it still ranks among the three worst countries worldwide, according to the 2014 World Competitiveness Yearbook
WORLD CUP: SUCCESS OR FAILURE?
It wasn’t supposed to be this way. When Brazil secured the rights to host the 2014 World Cup in soccer seven years ago, there was widespread joy both in Brazil and Latin America. However, the event is now marred by delays, cost overruns and growing protests.
"No country has been so far behind in preparations since I have been at FIFA even though it is the only host nation which has had so much time - seven years - in which to prepare,” Sepp Blatter, president of International Federation of Football Associations (FIFA), said earlier this year.
Even venerable Pele, Brazil’s soccer legend, has criticized the way the government has prepared for the World Cup. "It's clear that politically speaking, the money spent to build the stadiums was a lot, and in some cases was more than it should have been," Pele said, according to AFP. He said "some of this money could have been invested in schools, in hospitals.... Brazil needs it. That's clear. On that point, I agree (with the protests).”
Brazil's World Cup protests threaten the country's economy and its image, Reuters reports. Meanwhile, Brazilian police joined Sao Paulo bus drivers in work stoppages Wednesday, leaving commuters stranded in South America's largest city and crimes unreported before the World Cup starts on June 12, Bloomberg reports. The World Cup setbacks echo the obstacles that prevent Brazil from fulfilling its considerable economic potential, argues former Pimco CEO Mohamed El-Erian in a commentary for Bloomberg.
A HAPPY REGION
Latin America is the happiest region in the world,
according to Gallup. Of the 11 happiest countries in the world, ten are from
Latin America (the other one is Denmark). Of those ten, five are from Central
Gallup asked people in 138 countries worldwide whether they experienced lots of enjoyment, laughing or smiling a lot, feeling well-rested, and being treated with respect and learned or did something interesting the day before. It then compiled the "yes" results into a Positive Experience Index score for each country.
Paraguay tops the list, with a score of 87, followed by Panama (86), Guatemala , Nicaragua and Ecuador (83 each ).
Mexico has a score of 76, the same as Austria, China and France. Brazil’s score of 74 was the same as Germany.
Both Mexico and Brazil lagged the United States, with a score of 78.
The worst country in Latin America and the Caribbean? Haiti, with a score of 58. That ranked it among the 23 worst countries in the world. People in Haiti are less happy than people in Iraq and Ethiopia, Gallup found.
DHL SEES RECORD DEMAND FROM ASIA FOR LATIN AMERICA PERISHABLES
DHL Global Forwarding, the air and ocean freight specialist within Deutsche Post DHL, announced it has set a record number of charters in 2013 transporting perishables from South America, primarily Chile to Asia and Argentina to the U.S. market
For StarBroker, DHL Global Forwarding’s
in-house air freight carrier and charter broker, this season’s record charters
on their MD11F flights from Santiago, Chile to Miami, Fla. resulted in close to
30 flights, a large percentage of the carried fruits are destined to various
locations in Asia.
“Starting in 2012, for the first time in DHL Global Forwarding’s history, flights were sent directly from Chile to South Korea and then distributed to various locations in Asia,” DHL said. “The Chilean blueberries and cherries are meeting an increasing need for these fruits in China, Hong Kong, Kuala Lumpur, Japan, South Korea and Singapore, among other markets. “
In 2006, the China-Chile Free Trade Agreement
(FTA) went into effect. “This agreement as well as a growing market potential
for high quality fruit in China has been a key driver for Latin American
blueberry business,” DHL said.
ADVANCED HELPS GRIMOLDI ISSUE
With the help of investment bank Advanced Capital Securities, Argentina’s Grimoldi returned to the capital
market with the issuance of Series III Notes in the amount of 50 million pesos
(US$6.2 million). Bids received exceeded 93 million pesos, an over-
subscription that represents 3.1 times the amount tendered.
“The success of this transaction is due to the work we have done with Grimoldi and major investors, and was made ??possible by the correct understanding of the needs of the company and market, " Gonzalo Vallejos , Managing Director of Advanced Capital in Argentina, said in a statement.
Advanced Capital has other projects under development in Argentina as well. "Increasingly more companies understand the benefits of resorting to financing in the capital market and we are working with several of them in search of opportunities that arise," Vallejos said.
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