Former Peru prime minister, Pedro Pablo Kuczynski has joined the emerging market investment specialist The Rohatyn Group as a senior advisor. Kuczynski will help develop private equity investments with a focus on Latin America, said the firm. Prior to becoming prime minister of Peru in 2001, Kuczynski served as minister of economy and finance, as well as minister of energy and mines. From 1994 to 2001, he was president and chief executive of the Latin America Enterprise Fund, a private equity firm.
Category: Regions
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Fenosa To Invest $400 Million In Mexican Energy
Spanish gas and electricity company Union Fenosa is to invest nearly $400 milllion in building a 450MW generating plant in Mexico. The plant will be located in Durango state and takes Fenosa’s generating capacity in Mexico to 2,000 MW. The new generator is expected to come on line in 2009.
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Thurston Replaces Flockhart At HSBC Mexico
HSBC has announced that Paul Thurston has replaced Sandy Flockhart as chief executive of its Mexico unit. Thurston has been with the Bank for the past 20 years, most recently in charge of personal and commercial banking for HSBC Asia. Flockhart will continue as executive president of Grupo Financiero HSBC’s board of directors, the group said.
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Peru Gets Rating Boost
Peru’s sovereign debt credit rating got a boost on Tuesday after Fitch Ratings changed its outlook on the country’s ratings to positive from stable, commenting that it believed “favorable public finance and external account trends will continue,” raising the likelihood of an upgrade “over a horizon of two years”. However, the agency warned that the concentrated nature of the country’s export base in commodities remained a “key credit weakness”. Peru is currently rated BB+ by Fitch, just one level below investment grade. The sovereign also carries a BB+ rating from Standard & Poor’s.
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Colombia Moves Closer To Investment Grade
Colombia has moved closer to securing an investment-grade rating after Standard & Poor’s raised its long-term foreign currency sovereign credit rating on the Republic to BB+ from BB, just one notch below the level needed. “The upgrade is supported by Colombia’s significantly improved growth prospects and fiscal performance,” said S&P credit analyst Richard Francis. Nevertheless, the ratings agency emphasized the need for further tax and pension reform to improve the government’s fiscal prospects and lighten the debt burden, which would in turn lead to higher creditworthiness. It warned that “significant fiscal slippage or a sharp deterioration in national security” could, in contrast, have the opposite affect. US investment house Goldman Sachs, commenting on the upgrade, felt the ratings action was earned and thought that “consolidating and deepening the fiscal adjustment should remain the top priority for Uribe’s second presidential term”. It added that progress in this area could lead to an upgrade from Fitch in the “immediate future”, as well as Moody’s. Goldman concluded that Colombia could reasonably expect to achieve investment grade status “towards the end of 2008 or beginning of 2009”.
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Colombina Plans Bond Issue
Colombian food company Colombina is to issue longer-term debt to extend its debt profile. Colombina hopes to raise around $22.3 million (50 billion pesos) in local-currency, 10-year bonds, said the company. The securities will pay a maximum of the inflation index plus a spread of 6.10 percentage points, reported Dow Jones. Corficolombiana structured the deal.
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Mexico Inflation Fears
The continuing high price of corn, and in turn the cost of Mexico’s staple food – the tortilla – is continuing to put pressure on prices in general and are sparking fears of a rise in inflation as the price rises spill over into other sectors, such as wages. Mexico’s core inflation rate, which excludes energy and some fresh foods, rose to 3.95% for the 12 months through mid-February, from 3.89% in January. Meanwhile, annual headline inflation was up to 4.1% through mid-February, passing the 4% government target.
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Multi Credit Bank Buys Control of Macrofinanciera
Panamanian Multi Credit Bank has agreed to buy a 70% controlling stake in Colombian financing house Macrofinanciera. The deal between the local Castellanos family, which owns 100% of Macrofinanciera, and Multi Credit Bank is expected to be finalized by the end of May. No financial details were offered. Macrofinanciera has assets totaling $15.4 million (34.4 billion pesos).
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Mexican Opposition Lawmakers Block Hurtado Nomination
Mexico’s president, Felipe Calderón, looks to be facing opposition from lawmakers in his attempt to push through the nomination of Carlos Hurtado for a seat on the board of directors of Mexico’s Central Bank, Banxico. Opposition senators are blocking the appointment because of Hurtado’s former position as deputy finance minister in charge of spending under Vicente Fox’s administration. The five-member Banxico board has had a vacant seat since the end of last year.
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Panama Economy Expands 8.1%
Panama’s economy grew by 8.1% last year, compared with 6.4% in 2005, according to official government figures. Construction was the most dynamic sector, rising 17.4%, banking expanded 12.8%, hotels and restaurants grew 12.5%, and trade was up 11.3%.