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ALABC's monthly newsletter, "Latam News," keeps members and supporters abreast of developments taking place in the Latin American markets. Locked articles can be read by paid ALABC members, including Individual, SME, Corporate and Patron.
LATAM News February 2015
Features this month include: *Goodman Group looks to US and Brazil for growth *Air New Zealand becomes Patron Member of ALABC *Chile seeks Australian expertise in water *New appointment to COALAR executive committee *Expanded Air Services Agreement between Australia & Chile *Peru's first step to full membership of OECD Sign-in to read


ALABC Chairman's Message 2015

Chairman’s Message

As we launch into 2015 it is obvious that volatility in the global markets is likely to be with us throughout the year and that the global economy will be operating under a new ‘normal’.

Like almost all markets in the world, those of Latin America will be impacted. With falling oil and metal prices weighing on government finances and endangering investments, economists have generally reduced their 2015 growth forecasts for the region's seven largest countries, from Mexico to Argentina.

Brazil is now expected to grow a meagre 0.5 percent in 2015, down from an earlier estimate of 1.1 percent and barely up from an expected 0.2 percent growth in 2014. Mexico will probably expand by 3.4 percent, while oil producer Venezuela, flirting with a debt default, will probably contract 2.0 percent, according to a poll of about 50 economists.

Faced with growing economic challenges, the general response has been a shift toward orthodoxy. In Brazil, re-elected President Dilma Rousseff has appointed Chicago-trained banker Joaquim Levy as finance minister and has foreshadowed tax hikes and budget cuts. In Argentina, all potential candidates in the October presidential election are seen as more market-friendly than President Cristina Fernandez. In the north, Mexico's finances are in better shape, which should help it take advantage of faster U.S. growth to accelerate closer to its potential. However, the main risks lie on the energy sector, where falling oil prices may threaten investments.

The situation varies from country to country, but the trend is generally similar in each one. Some will benefit from weaker exchange rates which may boost exports, but the expected exchange rate volatility could also fuel inflation. Interest rates may rise as a result and could climb to as high as 13 percent in Brazil.

How long this new ‘normal’ will be with us remains to be seen, but businesses need to accept that it is here and that action plans need to be developed to make the best of the situation and, above all, the undoubted opportunities that remain on offer in the region. Our three lead articles in this edition  - regarding IFM Investors, Karoon Gas and Petrel Energy -  are proof that the region remains ‘open for business’.

Volatility can also produce opportunity, and this is very much the case in Latin America. Companies that are well-managed and have solid balance sheets are likely to find that this year is an ideal one to invest for the future. Asset valuations are likely to fall and there is every likelihood that good buying opportunities will arise. For example, the slowdown in the mining sector is likely to mean that there will be a flight to quality in sourcing products and services, as mining companies strive to make greater use of innovation to cut costs and increase productivity.

The slowdown may also mean that we will finally have more light shone on the opportunities that exist in other sectors and on the success that Australian businesses are having beyond the resources sector. For example, it is not widely known that Australian majors such as Amcor and Brambles (through its Chep operations) have a large presence in the region.

Although not regularly reported, a growing number of Australian SMEs are forging successful business in the region and their progress is encouraging other players to follow in their footsteps. This was evident from the number of winners of the Austrade 2014 Export Awards who acknowledge the contribution of Latin America in their acceptance speeches, including Melbourne-based SDI, Queensland’s Cardo and Opmantek.

Despite the need for caution, I believe that 2015 has the potential to be a very positive year in the development of Australia’s engagement with Latin America. If all goes to plan, we can expect an increase in the exchange of ministerial and business delegation visits, as well as in the number of Australian companies that choose to make a move into the region. There may also be more investment from the region into Australia.

My confidence stems from the developments that I am seeing take place in the region and from the extensive level of activities planned by the government  - both federal and state -  and by business groups that want to focus more of their attention on the region. The momentum in favour of Latin America is set in stone and our Council plans to be at the forefront of adding to it.

Jose Blanco


Article attachments

LATAM News January 2015
Features this month include: * IFM Investors move into Mexico * Karoon Gas hopeful on Brazilian drilling program *Petrel Energy makes headway in Uruguay *Amcor Rigid Plastics rated highly in Argentina *Peru simplifies rules to spur mining investment *PwC releases'Doing Business in Mexico'guide Sign-in to read

LATAM News December 2014
Includes items such as: * Air New Zealand to fly direct to Buenos Aires from December 2015 * Latam Autos debuts on ASX * Ministers Julie Bishop and Andrew Robb visit South America * Mexico is on the radar of Australia’s sheep meat sector * Spanish program paving the way for Latin American Studies in Queensland * Repo... Sign-in to read

LATAM News November 2014
Macquarie refines its push into Latin America * University of Sydney Vice-Chancellor sees bridging role for Australia in Latin America’s future * Brazil’s JBS buys Primo for $1.45bn * Appointment of new ambassador to Argentina * Chairman’s Message * Showcasing the 25th Anniversary Sydney Dinner * What can Brazilians expect from Ro... Sign-in to read

LATAM News October 2014

LATAM News September 2014
*  BHP Billiton signs alliance with Mexico’s Pemex  * Brisbane 25th Anniversary Dinner - Last Tickets Selling Now!  *  WorleyParsons looks to Mexico for growth opportunities  *  Historic Sydney Dinner – RESERVE THE DATE  *  Chairman’s message  *  University of Queensland Latin... Sign-in to read

Lima prepares to host the 2019 Pan Am Games

Lima prepares to host the 2019 Pan Am Games

Peru’s capital city, Lima, will host the 2019 Pan American Games and is seeking architects, designers, construction companies, event planners and producers and others to help prepare for the major sporting event.

The Australian Trade Commission (Austrade) is assisting Australian companies by providing guidance on the planning process and requirements, which will largely be managed by the Peruvian Olympic Committee. Austrade’s Daniel Havas, Trade Commissioner in Lima, said Australia has a strong reputation worldwide for its depth of experience in all aspects of major sporting events.

In 2012, Austrade launched a campaign to promote Australia's unrivalled experience and expertise in an industry expected to be worth more than US$145.3 billion by 2015. ‘More than 140 Australian companies and major sporting event specialists have played pivotal roles shaping every major sporting event around the world since the Olympic Games were held in Sydney 14 years ago,’ Mr Havas said.

The organising committee plans a series of events in various locations over the next five years to promote and position the upcoming games. In addition, the Olympic Committee is also bidding on several other major sporting events both in the lead-up to 2019 and beyond.

‘This is an opportunity for companies to work with the committee on a master plan of events from now until the closing ceremony in 2019,’ he said.

The Peruvian Olympic Committee has indicated to Austrade it seeks capabilities in master event planning and staging, including transport, security and technology. It is also planning for the construction of an athletes’ village, aquatic centre and 12 000-seat auditorium among others. 

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