LATIN AMERICA ADVISOR a DAILY PUBLICATION of the DIALOGUE Wednesday, May 6, 2020
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LATIN AMERICA ADVISOR A DAILY PUBLICATION OF THE DIALOGUE www.thedialogue.org Wednesday, May 6, 2020 BOARD OF ADVISORS FEATURED Q&A TODAY’S NEWS Diego Arria Director, Columbus Group POLITICAL Devry Boughner Vorwerk Is López Obrador Trump Denies CEO, DevryBV Sustainable Strategies Involvement in Joyce Chang Global Head of Research, Eroding Mexico’s Venezuela Incident JPMorgan Chase & Co. U.S. President Donald Trump said Paula Cifuentes his administration had nothing Director of Economic & Fiscal Affairs, Business Climate? to do with an apparent botched Latin America & Canada, Philip Morris International incursion in Venezuela that left Marlene Fernández two U.S. citizens behind bars. Corporate Vice President for Page 2 Government Relations, Arcos Dorados Peter Hakim BUSINESS President Emeritus, Inter-American Dialogue MercadoLibre to Donna Hrinak Invest $717 Million President, Boeing Latin America Jon E. Huenemann in Brazil This Year Former Corporate and The e-commerce marketplace Government Senior Executive plans to invest 4 billion reais James R. Jones ($717 million) in Brazil this year. Chairman, Some of Mexican President Andrés Manuel López Obrador’s policies have unnerved investors. Monarch Global Strategies // File Photo: Mexican Government. The site saw a jump in sales as consumers turned to online shop- Craig A. Kelly ping amid stay-at-home orders. Director, Americas International The coronavirus pandemic is expected to hit Mexico’s Gov’t Relations, Exxon Mobil Page 3 John Maisto economy, which was already in recession when the year Director, U.S. Education began, with brutal force. President Andrés Manuel López Finance Group POLITICAL Q Obrador has been criticized for doing too little to help Nicolás Mariscal Moro Testifies Chairman, businesses, many of which are faced with insolvency as revenues from Grupo Marhnos trade, tourism, remittances and oil exports have dried up. Since taking That Bolsonaro Thomas F. McLarty III Chairman, office, López Obrador has also unnerved investors by taking actions Tried to Control McLarty Associates that include scrapping plans for a new Mexico City airport and halting a Rio’s Police Carlos Paz-Soldan Partner, $1 billion brewery project. How are López Obrador’s policies affecting Sérgio Moro, who resigned last DTB Associates, LLP Mexican companies and foreign investors’ appetite for putting money month as Brazil’s justice minister, Beatrice Rangel testified that President Jair Director, into the country’s businesses? How much confidence can foreigners Bolsonaro pressured him to allow AMLA Consulting LLC have that they can seek relief through Mexican courts or arbitration if Bolsonaro to control the police in Jaana Remes disputes arise involving their investments in Mexico? How important is Rio de Janeiro. Partner, Page 2 McKinsey Global Institute investor confidence to Mexico’s economy, and what should the govern- Ernesto Revilla ment do to support it? Head of Latin American Economics, Citi Gustavo Roosen Chairman of the Board, Adrián Magallanes, partner at Von Wobeser y Sierra: “Mex- Envases Venezolanos ico’s foreign investment environment can be characterized Andrés Rozental by at least two themes. On the one hand, President López President, Rozental & Asociados Obrador’s administration has intervened in existing public Shelly Shetty A works and private construction projects. Prior to his 2018 inauguration, Managing Director, Sovereigns Fitch Ratings he pledged to hold regular plebiscites on such projects. Many have ques- tioned the constitutionality of these plebiscites, and the number of voting participants in them has been very limited. However, these plebiscites have already led to the cancellation of the new Mexico City airport project and the halting of Constellation Brands’ $1.4 billion brewery project in Moro // File Photo: Brazilian Government. Continued on page 3 COPYRIGHT © 2020, INTER-AMERICAN DIALOGUE PAGE 1 LATIN AMERICA ADVISOR Wednesday, May 6, 2020 POLITICAL NEWS former soldiers of U.S. Special Operations, NEWS BRIEFS were “confessing without any reservations” Moro Testifies That after security forces arrested them during an El Salvador’s Bukele apparent botched invasion launched by sea Announces New Bolsonaro Tried to on Sunday. “Whatever it is, we’ll let you know,” Trump told reporters Tuesday in Washington, Restrictions on Movement Control Rio’s Police the Associated Press reported. “But it has Salvadoran President Nayib Bukele on Tuesday nothing to do with our government.” Venezue- rolled out tougher measures to combat the Brazilian President Jair Bolsonaro sought to lan authorities identified the two men as Luke spread of the coronavirus, among them limiting control the police in Rio de Janeiro, where his Denman and Airan Berry, who both have ties to shopping trips to twice a week and prohibiting sons are under investigation, and in March told Florida-based private security firm Silvercorp the crossing of municipal boundaries, even to then-Justice Minister Sérgio Moro to allow him USA. The company’s founder, Jordan Goudreau, buy food or medicine, Reuters reported. The that oversight, according to testimony by Moro, a retired U.S. Green Beret, claimed responsibil- new measures take effect for 15 days starting which was made public Tuesday, The Wall ity for “Operation Gideon,” which was launched on Thursday. The Central American nation has Street Journal reported. “You have 27 police Sunday morning with an attempted beach registered 587 cases of the coronavirus and 14 districts, I just want one, Rio de Janeiro,” the landing from a speedboat. Venezuelan officials related deaths. Bukele’s government has imple- president allegedly told Moro in a Whatsapp said six of the purported attackers were killed, mented one of the region’s strictest lockdowns. message. Moro, who resigned last month after revising the number down from the previously [Editor’s note: See related Q&A in the April 30 accusing Bolsonaro of political intervention in reported eight. On Tuesday, the U.S. State issue of the Advisor.] police investigations, on Saturday testified for Department reiterated Trump’s denial of any about eight hours to prosecutors looking into involvement, accusing Venezuelan President the matter. The popular former justice minister Nicolás Maduro of engaging in a “disinforma- provided details of his relationship with the tion campaign” to serve as a distraction from Chilean Police Arrest president, recordings of conversations with incidents including a prison riot in Venezuela’s Nine in Connection him and Whatsapp messages, Folha de S.Paulo Portuguesa state that left at least 46 people With $15 Million Heist reported. Bolsonaro has denied meddling in dead. “Nothing should be taken at face value Chilean police have arrested nine suspects police investigations. “I didn’t interfere with when we see the distorting of facts,” a State involved in one of the country’s largest heists, anything,” he told reporters outside the presi- Department spokesman said in a statement, the theft of $15 million in cash from the Santi- dential residence on Tuesday, The Wall Street the AP reported. “What is clear is that the for- ago airport in March, Interior Minister Gonzalo Journal reported. “It’s exhausting for me. My mer regime is using the event to justify an in- Blumel said Tuesday, Agence France-Presse family is suffering,” he added. Bolsonaro’s three creased level of repression.” The United States reported. Police also recovered about $122,000 sons, all of whom are public officials, are under is among dozens of countries that recognize of the stolen money. The detainees include investigation in Rio de Janeiro for suspected opposition leader Juan Guaidó, not Maduro, as a gang leader, and most of them were career malfeasance. All have denied wrongdoing. On Venezuela’s legitimate president. criminals, according to Héctor Espinosa, Tuesday, the president said that his newly ap- the head of Chile’s investigative police, AFP pointed federal police chief, Rolando Alexandre reported. de Souza, planned to name a new police chief ECONOMIC NEWS in Rio de Janeiro. Colombia’s Coal Trump Denies European Commission Exports Decline Adding Panama, Bahamas Involvement in 17 Percent in March to Money Laundering List Venezuela Incursion The European Commission is adding several Colombia exported 5.9 million metric tons countries, including ones in Latin America and U.S. President Donald Trump on Tuesday de- of coal in March, a 17 percent decline from the Caribbean, to its list of nations that pose a nied involvement in an apparent incursion last February, S&P Global Platts reported Tuesday, financial risk to Europe because of shortfalls weekend in Venezuela that landed two U.S. cit- citing government statistics agency DANE. in fighting money laundering and the financing izens behind bars in the South American coun- However, the country’s coal exports rose 6.5 of terrorism, Reuters reported. The document, try, The Washington Post reported. Venezuela’s percent in March as compared to the same expected to be published on Thursday, includes foreign minister said two Americans, both month last year. Due to the sharp drop in coal Panama, the Bahamas, Barbados, Jamaica and Nicaragua. COPYRIGHT © 2020, INTER-AMERICAN DIALOGUE PAGE 2 LATIN AMERICA ADVISOR Wednesday, May 6, 2020 prices, Colombia’s receipts for March exports FEATURED Q&A / Continued from page 1 of the commodity amounted to $322.59 million, a decline of 30.6 percent as compared to Mexicali. Further, his administration has also worth repeating that