December 1, 2005 www.LatinEPR.com LatinEPR News Wire
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Dear Reader,
As travel professionals, we spend every day looking beyond our own homes and our own borders, thinking of ways to better communicate with the world and gain insight into its varied places, cultures, and peoples. Yet 2005 was the sort of eventful year that reminded not just us, but everyone everywhere of the reality of other people’s lives. We followed their journeys in the media, voiced our concern, and tried to help with unprecedented efforts. And although the struggle to simply live this year has been great for many, we must be grateful for the evidence of kindness, of which we were all capable. So this holiday season, we would like to wish you peace and happiness, but most of all, continued success in love and compassion. Sincerely,
Carola Perla, Editor
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LATIN AMERICA - COMMUNICATIONS/MEDIA
Televisa Debuts Online Music Store
This past month, Mexican media giant Televisa joined forces with major recording labels to sell music on its new online store Tarabu. This marks the first time in the industry that labels like Universal Music, BMG, Warner Music, and EMI Televisa Music have united to sell digital content to the US and Latin America. With an initial catalog of 300,000 local and international songs, which Televisa expects to expand to 1 million by spring, Tarabu targets the expanding number of broadband Internet users in Latin America, as well as the burgeoning US Hispanic market. Esmas, the Televisa Internet portal that hosts Tarabu, has 4 million Hispanics visiting the Web site daily. Moreover, Tarabu’s legal downloads could have a particular impact on the Mexican music industry, where rampant piracy has contributed to a 63% drop in local record sales in the last five years.
MTV Introduces New Services to Brazil
Media conglomerate Viacom expanded its reach over Latin America this November with the creation of Viacom Networks Brasil (VNB) and the launch of two new services, music and entertainment channel VH1 and gay and lesbian channel Logo TV. Viacom already offers numerous digital pay-TV services through its existing Latin American MTV Networks divisions. Its new venture strengthens Viacom’s position in what Pierluigi Gazzolo, managing director of VNB, describes as one of the region’s biggest and most promising markets.
Google Tests Travel Feature
Google Inc. recently announced the testing of a new search feature that would connect users to travel agencies offering the cheapest fares. Travel search sites like Sidestep and Kayak already perform a similar task, sifting through published booking information and prices. Unlike agencies like Expedia and Travelocity, Google would not sell fares, only locate them through specific flight inquiries between two points, then providing links to booking sites.
Hispanics: An Untapped E-Commerce Opportunity
Marketers and retailers are finally beginning to focus on the $690 billion Hispanic market, but are paying little attention to the ethnic group’s presence on the Web. Thus asserts Joseph Anthony, CEO of Vital Marketing, in his recently published article for DM News, the online Newspaper of Record for Direct Marketers. According to Anthony, one of the main reasons that only a fraction of the $3 billion spent in targeted niche advertising toward the Hispanic population last year went to online advertising is that non-cash and carry fiduciary exchanges traditionally excluded minorities. But that is the case no longer. Although Hispanics still hold bank and credit card accounts at a much lower rate than the mainstream US population, they are also among the fastest growing mobile segments of American society with annual household incomes exceeding $100,000. Increased economic mobility and acculturation are resulting in mainstream tastes and buying habits, which include e-commerce. Moreover, alternative means of credit, like prepaid cellular carriers and credit cards, are changing the purchasing habits of Hispanics who are either credit-wary or have poor credit. Claims Anthony, the door to Hispanics using the Internet as a point of purchase has opened.
LATIN AMERICA - NEWS BRIEFS
Portuguese Airline TAP Invests $500 Million in Struggling Varig
This November, President of Portuguese airline TAP, Fernando Pinto, announced his company’s intention to invest $500 million on the reorganization of Brazilian carrier Varig, which stood to have its entire fleet seized by a US court order if it did not repay its substantial $3.18 billion debt. Along with TAP’s recent $62 million purchase of Varig subsidiaries, VarigLog and VEM, the new deal would allow the struggling air carrier to repay part of what it owes to employees, as well as put planes back in the air and generate much needed revenue again.
Mexicana Temporarily Discontinues LA-Cancun Flights
Mexicana Airlines has temporarily discontinued all nonstop flights from Los Angeles to Cancun. Flights have been cancelled since October 19 due to damages caused by Hurricane Wilma in the region. However, the airline continues to provide customers with service to Cancun connecting through other Mexican cities. In fact, Mexicana currently offers six daily flights to Cancun connecting via Mexico City. Mexicana is also soon introducing nonstop Mexico-Miami and Mexico-Baltimore flights, as well as redeye service between Portland, Oregon and Guadalajara.
Peru-Chile Tension Escalates as Peru Cancels Energy Project
Peru has pulled out of a regional energy project which would have supplied Mercosur members with natural gas, primarily from the Camisea area in the Peruvian jungle. At the moment, Bolivia holds the largest regional natural gas supply, after Venezuela, but Mercosur members want an alternative energy source to that of the troubled Andean nation. Peruvian authorities explained that the country withdrew its participation, because it failed to take into account domestic market demands and exports to Mexico. Peru is also reluctant to enter into any energy agreement that excludes Bolivia. However, Peru’s decision comes on the heels of a Peruvian Congress decision to redraw the nation’s sea borders and reclaim territory lost to Chile in the 1897 War of the Pacific. Some see the maritime dispute with Chile as partly responsible for Peru’s surprise withdrawal, since Chile would have benefited from the project. Peruvian relations with Chile were also affected by the arrival in Santiago of former President Alberto Fujimori, who is charged in Peru with crimes involving corruption and extrajudicial deaths. Chile’s arrest of Fujimori these past weeks appears to be a first step in mending the fence between the two Andean nations.
Blades Sings Panama Praise in New England
Panamanian Minister of Tourism and Grammy winner Ruben Blades recently received an honorary doctorate of music from Berklee College of Music for his contributions to Latin music over his lifetime. While in Boston, Blades took the opportunity to extol his country’s virtues, from its strong ecotourism to its distinction as an important financial and maritime trade center.
Puerto Rico Launches New Ad Campaign
This past month, the Puerto Rico Tourism Company unveiled “Puerto Rico: Explore Beyond the Shore”, a new advertising campaign for the US and local markets. According to Terestella Gonzalez Denton, Executive Director of PRTC, the $26 million campaign aims to position the island as a world class destination and to reaffirm Puerto Rico's strong commitment to the environment and sustainable tourism. The ad campaign also highlights Puerto Rico’s cultural heritage and the regional destination of Porta del Sol. In addition to the overall campaign, PRTC is launching the "Puerto Rico Explore Pass" to entice tourists to extend their stay on the island to at least five days, by providing incentives such as $100 in cash, a $25 credit for fuel and 20% discounts for walking tours of Old San Juan.
IV Americas Summit Fails to Resurrect FTAA
“Creating Jobs to Fight Poverty and Strengthen Democratic Governance” was the official agenda of the IV Americas summit, held the first week of November in Mar del Plata, Argentina. But as with every year since the summit’s inception in 1994, it was the Free Trade of the Americas Agreement proposal that dominated the talks. And as in the past, the meetings ended with the 34 participating states no closer to reaching an accord than before. Main opposition comes from the five nation block of Argentina, Venezuela, Brazil, Uruguay, and Paraguay, all of which have expressed concerns over the FTAA’s fairness, particularly in regard to farm subsidies and the rights over intellectual property. Argentina’s Nestor Kirchner called the US-backed proposal a reflection of outmoded neoliberal ideas that have in recent years proven disastrous to countries like his own. Like many detractors of the proposal, the leaders of the five nation block argue that free trade alone cannot alleviate poverty – the initiative must come from the governments themselves – and that agreements like the FTAA disproportionately favor global powers like the US and Canada. However, supporters of the FTAA counter with the claim that Latin America is in desperate need of free market conditions. Either way, the real drama in Mar del Plata, captured by media around the world, was found in the rallies and demonstrations staged outside the summit, with such diverse personalities as soccer legend Diego Maradona and Bolivian indigenous leader Evo Morales in attendance.
Mexico and Venezuela Seek Mercosur Integration in 2006
At the IV Americas Summit, Mexican President Vicente Fox announced that his country will begin the Mercosur incorporation process in the first half of 2006. The South American Common Market, currently comprises full members Argentina, Brazil, Paraguay, and Uruguay, as well as associate members Bolivia, Chile, Ecuador, Colombia, Peru, and Venezuela. Not since its creation in 1994 has Mercosur introduced any new full members. One other country vying for such status is Venezuela, which could achieve full integration by December 2006. However, recent candid conversations between Fox, Chavez, and Kirchner at the Americas Summit could influence the political climate surrounding next year’s Mercosur negotiations. Argentina and Mexico have issued statements since the summit that relations between each remain excellent. Mexico’s relations with Venezuela, however, are being complicated by Fox’s support of the FTAA in spite of his Mercosur aspirations and by criticism from Chavez of Mexico’s policies towards the US. The dispute led to Mexico’s recalling its ambassadors from Caracas in mid November.
Pro Mujer Helps Poorest Women in Argentina
Pro Mujer, a non-profit organization dedicated to helping Latin America's poorest women help themselves through micro-credit, business training and health care linkages recently announced the launch of operations in its fifth Latin American country, Argentina. Founded in 1990, the organization has helped women in Bolivia, Nicaragua, Mexico, and Peru, disbursing over $180 million in loans to over 250,000 clients and enjoying a repayment rate of 99%. Thus far, Pro Mujer clients have managed to generate savings of over $7.2 million.
Brazil Plans First Football Museum
The Brazil Football Association announced this past month that it plans to set up the first Brazilian football museum in the renowned Sao Paulo Pacaembu Stadium. The museum, set to open in 2007, will cost 11.3 US dollars and house an extensive collection of memorabilia, as well as audio and video records, that document the history of Brazilian football since the late 1890’s. The legendary Brazilian football star Pele also intends to contribute material from his private collection, and spoke at the recent announcement about the importance of such a project to honor Brazil’s passionate and successful football culture.
LATIN AMERICA - TACKLING POVERTY
Latin America Introduces Innovative Strategies for Tackling Poverty
Poverty in Latin America – the region’s most pressing problem – can be attributed to many things. In general terms, it is the product of social inequality, political instability, and economic exploitation. Some may call it the effects of colonialism, tracing it back through the region’s complex and oftentimes bellicose history. Others may point to contemporary issues like political disenfranchisement, corruption, and deficient infrastructure. And then again, in light of recent environmental events, one is reminded of the detrimental effects of the region’s frequently experienced natural disasters.
But as complex as the roots of poverty may be, they are nothing compared to the region’s failed attempts to combat it – until now.
In the past couple of years, a new trend in social welfare programs has taken hold of countries like Mexico and Brazil. Based on the concept called Conditional Cash Transfers, programs like Mexico’s Oportunidades and Brazil’s Bolsa Familia are reinventing government aid with the help of extensive research and computerization. Social programs targeting the poor have proven ineffective in the past, because they were easily corrupted and did not have the resources, efficient organization, or sustained political support to insure that assistance went to the people who needed it most. What these new programs accomplish is to properly screen and track recipients of cash transfers, which are only given as an incentive to use state services like schools and health care.
In Mexico, for example, Oportunidades issues bimonthly payments to the female heads of over 5 million households, which amount to a quarter of the country’s population. Women, which are more likely than men, according to research, to stay in their communities and spend the money on their families, receive these payments for food, school supplies, and transportation, on the condition that children do not miss more than 15% of class or fail a grade twice. The family must also regularly visit a health clinic. Each woman is issued an electronic bank card to access her personal government account without the fear of fraud. Thus far, the program is enjoying political support and school attendance is on the rise.
Brazil’s Bolsa Familia, set up in 2003, provides income supplements to 7.5m of the country’s poorest families (30m). Eventually it hopes to reach all of the 11.2 million families who currently live on less than $45 a month. The program’s success until now can be attributed to its innovative system of dispensation. Here, women candidates are chosen by district instead of local authorities, which in the past would favor friends, and additional social councils monitor how the program is run on a municipal level. Computerization is also making it possible to weed out beneficiaries that actually have formal sector employment. Conditions for Bolsa cash transfers, which sometimes as much as double a family’s income, are that children are vaccinated, their health monitored, and kept in school. It is astonishing to think that Bolsa helps a quarter of Brazil’s population survive on 0.36% of the country’s GDP. In recognition of its effectiveness, the World Bank is giving $572 million to expand the program.
A half dozen Latin American countries, including Peru, Argentina, and Chile are implementing similar schemes of their own. Peru’s Juntos is the newest of these programs and aims to reach 400,000 people in 60 districts by end of the year. Juntos focuses on the rural poor which live without two of the following basic needs – running water, electricity, schools, or health services. To qualify for the stipend, provided in full for a period of 8 years, families must have children under 14 enrolled in school and vaccinated. The program encourages adults to apply for national id cards and birth certificates for their children. As in the case of Bolsa and Oportunidades, Juntos recipients are women. If the program is successful, it could cover half of Peru’s absolute poor. At the moment, about 2.5 million live on less than $1 a day.
With CCT programs in their infancy, debate abounds as to whether they are the answer to a deep and complicated issue. Supporters point to the rise in school attendance and use of other governmental services. The programs seem resilient to regime change and are dedicated to helping the poorest, which were previously excluded from social insurance that benefited those with formal employment. But detractors argue that it will take more than CCTs to access the extreme rural poor. CCTs at the moment do little to guide its recipients into productive work, and schooling is only as good as the schools.
Undoubtedly, Latin American nations will need to address basic infrastructure concerns, like access to clean water, if they hope to alleviate poverty. The region’s positive economic prospects promise such improvements. Lets hope that this economic well-being finds a way to reverberate throughout every sector of Latin American society.
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