BY CHRONICLE STAFF
Despite the impressive progress in security under president Alvaro Uribe, Colombia's critics still manage to delay badly-needed free trade agreements. Not only in the United States, but also in Canada. There the agreement, signed last November, was formally presented to lawmakers on March 26, along with Canada's FTA with Peru. However, experts like Carlo Dade, Executive Director of the Canadian Foundation for the Americas, believe it won't pass. “The Colombia agreement will not pass under this minority government,” he told Latin Business Chronicle. "As opposed to the United States, the Canadian and Colombian governments have not made the case publicly for the agreements in Canada and have left an information void that has been filled, loudly, by those opposed to the FTA." Last year, Canadian trade with both Colombia and Peru grew strongly, according to our new special report.
While most of the world will see declining advertising spending this year, Latin America is likely to see an increase of 8.2 percent to $20.3 billion, UK-based ad agency GroupM predicts. That contrasts with growth of less than 3 percent in North Asia and Asean and declines in markets like North America (down 4.2 percent), Western Europe (down 6.7 percent) and emerging Europe (down 15.8 percent). Globally, a spending should fall by 4.4 percent, GroupM estimates. Brazil's ad market should grow by 10.2 percent to $5.1 billion this year. That's three times higher than GroupM predicts in China, where ad spending should grow by 3.2 percent to $1.1 billion. That's also the best growth among 14 leading markets worldwide. Apart from Brazil, China and India, the other markets are all expected to see declines in ad spending this year. Elsewhere in Latin America, GroupM expects a decline in Mexico and nominal growth in Colombia and Chile.
Costa Rica and Uruguay managed to get taken off the blacklist of the Organization for Economic Cooperation and Development (OECD). The two had been among only four nations worldwide blacklisted for having non-cooperative tax havens. The two countries normally are seen as among the most respected in Latin America, ranking among the top in transparency, for example. This week, after pledges to implement appropriate changes, the two (along with the other two nations originally blacklisted) were moved onto the larger gray list, which includes countries such as Switzerland, the OECD announced.
Mexico's tourism has continued to grow despite the drug violence and the U.S. recession, with international visits up 2 percent in the first quarter of 2009 from the same period of 2008, Reuters recently reported. That followed a full year in 2008 in which international visits rose 5.9 percent from 2007. Tourism was a $13.3 billion industry in 2008, ranking it third behind oil and remittances from Mexicans living abroad. Countering US media reports that focus on violent areas of Mexico like Ciudad Juarez or Tijuana, officials are pointing to the distances to the safer destinations. The Mexican resort of Los Cabos is nearly 1,000 miles (1,600 km) from Tijuana and Cancun is some 2,000 miles (3,220 km) away, points out Carlos Behnsen, executive director of the Mexico Tourism Board.
Private equity and venture capital firms focusing on Latin America managed to raise $6.4 billion last year, of which $4.4 billion was actually invested, according to a new study by the Latin American Venture Capital Association (LAVCA) and The Wharton School. Five countries that have achieved or neared investment grade status in recent years – Brazil, Mexico, Colombia, Peru and Chile – dominate the regional private equity landscape, accounting for a almost 80 percent of the companies that received private capital investments last year. And despite the global chaos in financial markets, five firms closed on $770 million in commitments during the last quarter. "Latin America has had relatively limited exposure to the banking and credit crises plaguing developed and some emerging economies, " LAVCA said in a statement. "Banking systems are highly regulated and there is typically little leverage in acquisitions." Natural resources, alternative energy, infrastructure, agriculture and real estate were the hottest sectors.
Ecuador's angry, populist president Rafael Correa appears to have smooth sailing heading into the April 26. One poll in March by Santiago Pérez Investigaciones y Estudios shows Correa with 52 percent support versus 12 percent and 11 percent for his nearest rivals, Lucio Gutierrez and Alvaro Noboa. A Correa victory is no reason to celebrate, former foreign minister Edgar Terán warned in Miami recently. "If Correa doesn’t honor Ecuador’s commitments, sooner or later we Ecuadorians will have to pay with a much poorer country than we have today, de-dollarized and with high inflation," he said at a meeting organized by Florida International University's School of International and Public Affairs. He said the Ecuadorian people have been lulled to sleep with populist rhetoric, something which will lead to a plundering of their democracy and the establishment of a dictatorship.
Meanwhile, Correa's ideological cousin in Bolivia, Evo Morales is also doing his best to curtail democracy in his country. “Evo Morales has employed the language of democracy to consolidate a one-party regime where he can perpetuate himself in power," former president Eduardo Rodriguez told the same Miami meeting. "The tools of democracy are used to legitimize violations of due process, as is the case with mobs that use the excuse of community justice to subdue, rob and beat up their political adversaries."
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