Ecuador’s Constitutional Court (TC) has upheld a ruling handed down in June by the country’s Electoral Court to ban former president Lucio Gutiérrez from holding public office for two years. The Court voted six to three not to reverse the earlier decision, made as a result of campaign financing irregularities in 2002. The former leader had recently presented his candidacy to run for elections in October this year. Gutiérrez will not be able to appeal the ruling, according to the head of the TC.
Category: Regions
Posted inDaily Brief
Ecuador Expects Extra $1 Billion From Oil
Ecuador’s government has said that it expects to earn an additional $1 billion of revenues this year following the change in the hydrocarbons law affecting royalty payments and as a result of the confiscation of oil fields from US oil company Occidental Petroleum (Oxy).
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New Head At LAB
Troubled Bolivian carrier Lloyd Aéreo Boliviano (LAB) has a new skipper at the helm – Franklin Taendler – elected by the unions who are running the company. Taendler, who hails from Cochabamba and has 25 years of industry experience, has his work cut out for him at LAB. Its ex-president, Ernesto Asbun, is currently on the run and facing embezzlement charges. The former state-owned company was partially privatized in 2004 and has had a colorful history since then.
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Panama Buys Back Bradies
Panama has bought back all its outstanding Brady bonds, taking advantage of a call option on July 17. The move to buy back the $351.6 million bonds in circulation not only makes economic sense – by lowering debt service costs – but it is also seen as a symbolic act of severing links with a period of past insolvency. The sovereign used a one-year $320 million bank loan to prepay most of the debt. Panama has followed other sovereign issuers in the region in its move to improve the country’s debt profile. Earlier this year Brazil announced its multi-billion dollar Brady buyback plan; Venezuela’s buyback was set at $3.9 billion and Colombia will spend $4.3 billion on repurchasing the paper this year.
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Ecuador Presidential Campaigning Begins
Campaigning in Ecuador’s presidential elections, slated for October 15, has begun amongst uncertainty and continuing political upheaval. Left-of-center lawyer León Roldós is thought to be the early frontrunner facing right-of-center Cinthya Viteri and also, perhaps, former president Lucio Gutiérrez. The latter has registered his candidacy to run despite a ruling last month by Ecuador’s electoral court that Gutiérrez would not be able to hold public office for at least two years because of campaign irregularities in 2002. If no candidate wins more than 50% of the vote in October, a second round is scheduled for November 26. Ecuador has had seven presidents in the past 10 years, with the most recent change of leader in April 2005 when former president Lucio Gutiérrez was ousted from government by Congress and replaced by an interim leader, the incumbent Alfredo Palacio.
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Colombia Starts Final Bank Privatization
The Colombian government has started the privatization of its last remaining financial asset, Granbanco-Bancafé. The bank, the country’s seventh-largest in terms of assets, is expected to bring to the country’s coffers around $450 million and will give the successful buyer around 6% of the country’s banking assets. In this initial phase of privatization, and according to national law, the assets of the bank will be offered to the country’s pension funds, unions, cooperatives and other sectors of the so-called “solidarity” public sector. After this initial two-month phase, the bank will be offered up to other buyers. Of the local bidders, Grupo Colpatria, Grupo Bolívar, the mayor shareholder of Davivienda, and Bancolombia are all expected to participate in the sale. Foreign bidders may well include Spain’s Grupo Santander, Citibank and HSBC.
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Banco Agromercantil In Talks To Acquire Banco Del Café
Meanwhile, in Guatemala, the country’s fifth-largest bank – Banco Agromercantil – is in talks to buy Banco del Café, the next largest bank. The deal would be financed via a capital increase and with loans from Cabei, Citibank, and Wachovia. Banco Agromercantil was formed six years ago from the merger of two of the country’s oldest banking groups – Banco del Agro and Banco Agrícola Mercantil. Although one of the country’s smaller banks, with less than 10% market share, it is considered one of the most profitable and has been consistently voted best bank in Guatemala by financial publications. It is now in what it calls its “third phase”, which is one of expansion.
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Panama Approves Canal Project; Referendum To Decide
Panama’s upper house, the Legislative Assembly has approved the project to expand the country’s historic canal and vital waterway, the first expansion since the Panama Canal was opened in 1914. The $5.25 billion project – of which around half will come from foreign financing – will now be put forward for public approval in a referendum. The plans to expand the Canal, to accommodate ships with greater capacity – so-called “post-Panamax” vessels – are not without their critics, who say the country will be overly indebted for work which is not essential.
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Ecopetrol Delays Refinery Sell-Off
Colombia has delayed the privatization of state-run Ecopetrol’s Cartagena refinery, slated for mid-July, after some of the pre-qualified bidders requested more time. Ecopetrol, which has so far maintained a monopoly on oil refining in the country, is selling off control of the Cartagena refinery, the second-largest in Colombia, because private money is required to finance the much-needed $800 million expansion project. Pre-qualified bidders include: Brazil’s Petrobras, BP of the UK, Japan’s Marubeni Corp and Switzerland’s Glencore International. Ecopetrol will now pick a winner in August.
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IADB Approves $200 Million For Colombia
The Inter-American Development Bank (IADB) has approved a $200 million loan for Colombia to help improve its competitiveness. The 20-year loan is to be spent improving the business environment and help break down legal, regulatory and institutional barriers to foreign trade.