Miguel Galuccio has three principal objectives for 2014: “to produce, produce and produce.”
To help achieve that aim, Galuccio, who has run the Argentine energy company YPF since the government expropriated a 51 per cent share from Spain’s Repsol in 2012, is looking for partners. Continue reading »
With little more than a week left of his presidency, Sebastián Piñera is fighting on to the last.
On the anniversary of one of the most powerful earthquakes on record wreaking havoc in Chile just days before he came to power four years ago, Piñera trumpeted his government’s record in cleaning up the mess yesterday.
However much opponents may accuse him of massaging the numbers, with 97 per cent of the infrastructure destroyed now rebuilt according to official figures, it seems fair to say that Piñera did a decent job in keeping his promise to fix the problems by the end of his term.
Continue reading »
Is it the beginning of the end for what enthusiasts like to call “the trial of the century” in the world of sovereign debt restructuring?
Well, perhaps, but there could still be an painfully slow ending to a trial that has dragged on for the best part of a decade, after Argentina filed a petition on Tuesday – right on deadline – seeking a US Supreme Court review of an order to pay $1.33bn to “holdout” bondholders who refused to accept restructured debt after Argentina’s 2001 debt default.
There are now three possible scenarios as to how things could go for Argentina at the Supreme Court. Continue reading »
It had all been going so well for Uruguay’s president, José “Pepe” Mujica. The passing of a groundbreaking law this month that will legalise and regulate the production and consumption of marijuana has earned him praise around the world.
This even helped Uruguay earn its status as The Economist’s first ever ‘country of the year’. So the resignation on Saturday of Mujica’s finance minister, Fernando Lorenzo, was a bit of a dampener as the year comes to an end. He will be replaced by the president of the central bank, Mario Bergara it was announced on Monday. Continue reading »
It’s hot in Buenos Aires. So hot, that there has been a wave of blackouts this week as melting porteños, as residents of Argentina’s capital are known, jam the electric grid by cranking their air-conditioners up to full blast.
This has become an annual occurrence during heat waves in the southern summer, as continuous underinvestment in the electricity system – since utility rates were frozen over a decade ago – takes its toll. But tempers as well as temperatures have been rising – both on the streets where sporadic protests are disrupting daily life, and in the government, which has decided that the fault lies with the private companies providing the electricity, Edesur and Edenor. Continue reading »
In almost the only Argentine province not to be affected in recent days by damaging police strikes, which triggered a wave of opportunistic looting, a very different headache has emerged for President Cristina Fernández de Kirchner.
A series of articles published in the respected broadsheet La Nación this week which suggest that the president and her late husband, Néstor Kirchner, are linked to a series of murky property deals in Santa Cruz province have breathed new life into corruption allegations that Fernández would doubtless rather avoid. Continue reading »
Pot smokers all over the world may be lighting up joints to celebrate the fact that Uruguay on Tuesday became the first country in the world to legalise cannabis completely – from planting the seed to getting high.
But is what President José “Pepe” Mujica openly admits is an experiment going to work? Will Uruguay succeed in reversing rising crime rates, which were the initial impetus and justification for the new law? Continue reading »
When the oppressive heat in Buenos Aires becomes just too much to bear at the height of the austral summer, those who can afford it prefer to jet off to cooler climes to see in the New Year.
But some may have been forced to rethink their holiday plans after the Argentine government moved to stem an alarming decline of foreign currency reserves by bumping up the price at which it sells dollars to Argentines travelling abroad, in what amounts to a stealth devaluation. Continue reading »
It is the end of an era for businesses in Argentina. Might executives even start to miss Guillermo Moreno, the man that everyone loved to hate, in some perverse kind of version of the Stockholm syndrome?
Maybe that’s going too far, but the resignation of Argentina’s trade secretary – who since his rise to power in 2005 became so much more than just a trade secretary – leaves a gaping hole in the implementation of economic policy.
This vacuum of power will be filled by Axel Kicillof, a Marxist economics professor who sports Elvis sideburns, as the new economy minister. Continue reading »
Something had to give. Argentina’s gravity-defying stock market
has been heading for the skies this year, with some shares as much as quadrupling in value.
On Tuesday though, the Merval bourse was slapped in the face with a sobering dose of reality when the supreme court ruled that Grupo Clarín, the country’s largest media group, will effectively have to sell off many of its lucrative cable TV licenses. Continue reading »
Who in their right mind would want to invest in Argentina? Surely its capricious government that delights in changing the rules of the game (or just stopping the game altogether), and its troubled economy warped by price and exchange controls make it a potential disaster zone for investors – right?
Wrong. Investors have been piling into Argentine stocks all year long, with its Merval equity index very nearly doubling this year. Some stocks have quadrupled in value in 2013. Continue reading »
China's VP Li Yuanchao and Cristina Fernandez de Kirchner in May
Ask the governments of Ecuador or Venezuela: good relations with China can be really handy when you’re in a financial fix. This is something that Argentina seems to be cottoning onto, if a proposed $10bn loan materialises.
According to reports in local media this week, Argentina’s central bank is negotiating a deal with the Chinese that it hopes might help stem an alarming decline in its foreign exchange reserves. Continue reading »
Anyone unsure as to why Argentina fills foreign investors with dread need only take a glance at the list of cases it has at the International Court for the Settlement of Investment Disputes (ICSID).
Of a total of 439 legal disputes between countries and companies at the World Bank tribunal, no fewer than 50 involve Argentina – far more than anywhere else, with socialist Venezuela lagging some way behind in second place. Continue reading »
Much as Cristina Fernández might like to pretend that exchange controls don’t exist in Argentina, they do, and they haven’t worked all that well.
Since they were implemented two years ago, the central bank’s foreign exchange reserves have fallen by some $15bn, recently falling below the $35bn mark. They are now at their lowest level in more than six years. Continue reading »
The suspense continues: silence from the US Supreme court on Tuesday on what is to be done about Argentina, after it appealed a lower court ruling in favour of “vulture funds” that refused to accept the terms of debt restructurings after its 2002 default.
Although there was a chance that the court could have taken up Argentina’s case on Tuesday when it announced the list of cases it will hear when its new term starts on October 7, no one seriously thought they would. Argentine debt prices barely budged on the news. Continue reading »