Javier Gutiérrez Pemberthy will become the new head of Colombian state-run oil concern Ecopetrol from January 18, its board of directors confirmed Monday. Gutiérrez is currently head of another state-run enterprise – Colombia’s largest energy provider, Interconexión Eléctrica SA (ISA). ISA has gone from strength to strength in its strategy of regional expansion, buying into the Brazilian and Peruvian markets this year. Gutiérrez is seen as an executive with plenty of experience to oversee Ecopetrol’s share offering some time next year and to help expand the company.
Category: Regions
Posted inDaily Brief
Calderón Takes The Reins
Mexico’s new president, Felipe Calderón, was inaugurated Friday in a ceremony kept short by recent protests from opposition lawmakers in Congress who threatened to disrupt the day. Calderón inherits a country with escalating social and political tensions and analysts are watching to see what line he takes regarding law and order. One of his first acts was to sign an austerity decree which will, reportedly, save the country $2.3 billion in spending next year. The decree allows for a 10% cut in the salary of the president and other government ministers. The president also designated former energy minister Jesús Reyes Heroles González as the new head of state-run oil company Petróleos Mexicanos (Pemex).
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Credit Suisse Recommends Colombia FRN Switch
Credit Suisse is recommending investors switch out of Colombian FRN 2015s into the more liquid 2017s to take advantage of current levels. Recent allegations of paramilitary links to allies of president Alvaro Uribe have caused Colombian spreads to widen and the 2015s to outperform. However, Credit Suisse analysts believe that if “allegations regarding Uribe quiet down and Colombia spreads tighten back to previous levels, the ’15s are likely to underperform”.
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Honduras Awards Fuel-supply Concessions
Honduras has awarded two of its international fuel-supply concessions to Conoco Phillips of the US and Mexico’s Gas del Caribe. From the start of next year, Conoco Phillips will supply gasoline and diesel, while Gas del Caribe will provide LPG to meet Honduras’ fuels needs in these areas and save the country around $55 million, according to the government. Concessions to supply kerosene, aviation fuel, and bunker were not awarded. The government will now have to negotiate with oil companies currently operating in the domestic market, such as Texaco, Esso, Shell and local firm Dippsa to rent storage and distribution facilities. The multinationals will be given notice of the date by which they must stop importing fuel to the country and are likely to file for compensation against the government.
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Mexico Brings Down Public Foreign Debt To $53.2 Billion
Figures released by Mexico’s finance ministry Thursday show that the country has brought down its public foreign debt, since the end of last year, by $12.5 billion to $53.2 billion as at October. Meanwhile, net public domestic debt rose by 152.5 billion pesos ($13.9 billion) during the same period as the government set about its program of exchanging foreign for domestic debt. The changes in its debt profile will help protect Mexico against external shocks.
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Correa Starts To Outline Plans
Ecuador’s president-elect, Rafael Correa, said he believes the country’s debt servicing payments need to be lower, but as yet has given no details as to how this will be achieved. Investors nervous of a full debt default by Ecuador have been selling off the country’s foreign bonds in recent days. However, not all investors believe a default is inevitable. JP Morgan in a research note Tuesday said it believed that, once in office, Correa would prove a pragmatist on the issue of foreign debt servicing and said it would be watching with interest as the first coupon payment on foreign debt comes due on February 15. Correa has confirmed that economist Ricardo Patiño will serve as his economy minister when he assumes the presidency on January 15. Also appointed are Alberto Acosta as energy minister and Carlos Pareja as president of state-run oil concern Petroecuador. Correa also said that his new government would start to renegotiate contracts with foreign oil companies from January, although he gave no details as to how royalty payments might be altered.
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Colombia Plans Globals, Samurais
Colombia is planning to issue $1.25 billion worth of global, local-currency bonds next year, according to Dow Jones. On Tuesday, Congress approved government plans to issue peso-denominated global bonds, which may replace peso bond issuances planned in the local markets. Congress also approved an issuance of Samurai bonds worth up to $500 million. Colombia has already sold $2 billion of international bonds to satisfy next year’s financing plans.
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Calderón Names Foreign, Interior Ministers
President-elect of Mexico, Felipe Calderón has named four more members of his team. His new interior minister will be Francisco Ramírez Acuña, a loyal supporter of Calderón, while Patricia Espinosa will become foreign minister. Ramírez Acuña was until recently governor of the state of Jalisco; Espinosa is a career diplomat. One of first challenges facing Calderón when he takes over on December 1 will be the tempestuous state of affairs in Oaxaca where protestors continue to demand the resignation of the state governor. Other appointments were Germán Martínez as comptroller general, and Juan Camilo Mouriño as head of a newly created office of the presidency.
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Mexico Completes External Debt Swap
Mexico Tuesday successfully swapped €493.8 million ($651 million) of euro-denominated foreign debt for domestic debt, with the exercise of its (XWE) series of warrants enabling investors to exchange the securities (UMS bonds) for peso debt (M bonds). Warrant holders exchanged euro-denominated bonds maturing 2008 to 2017 for 8.59 billion pesos of local-currency bonds due 2023. This is the last of four swaps that have seen Mexico exchange around $3 billion of foreign-currency debt for peso-denominated debt. Last November, Mexico sold three series of dollar warrants to enable investors to swap $2.5 billion of dollar-denominated securities for peso debt. Then in March this year, the sovereign sold warrants to swap euro-denominated bonds with a nominal value of €494 million into local-currency bonds due in 2023. Mexico is hoping to bring down its foreign debt-to-GDP ratio to around 6% by the end of this year from around 12% in 2000.
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Rinker Rejects Cemex Offer
Australian building materials group Rinker has formally rejected the $11.7 billion bid (A$16.84 per share) by Mexican cement producer Cemex. In a press release issued this morning, Rinker’s board unanimously recommended to shareholders they reject Cemex’s offer, saying it was “opportunistic” and “far too low”. According to Rinker, the company has been valued by an independent expert at between A$20.58 and A$23.04 per share. Analysts expect Cemex to increase its bid.