December 15, 2008        www.LatinEPR.com 

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Happy Holidays!

Dear Colleagues,

We at LatinEPR are grateful for having the opportunity to communicate with all of you every month and to be part of this wonderful travel industry - an industry that opens up the world and brings people from across continents together.

Please receive our most sincere greetings for this Holiday Season and great hopes for 2009.  From past experience, all crises have a positive element – they make us all more human.  We all pause more often to reflect upon our daily lives, routines and schedules.  We spend more time listening to other people’s problems, even if just to reconcile with our own or feel more connected.  We somehow count our blessings more often and surely include more items on the list of things to be thankful for, such as health, family, or even just the little insignificant things that make us happy.

With that in mind, we wish you a Holiday Season filled with all those little joys, as well as moments that grow in importance over the years, a Holiday season filled with hope. 

Sincerely, Ellie and Carola Perla  

Carola Perla, Editor

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LATIN AMERICA - NEWS BRIEFS

Media and technology

New US Hispanic Network on the Horizon

The US Hispanic television landscape may be welcoming a new competitor, as Liberman Broadcasting plans to nationally launch Estrella TV, a Spanish-language TV station with its own programming that could challenge strongholds Telemundo and Univision, reports Billboard.  Liberman currently owns Spanish-language TV and radio stations across the western United States, its Los Angeles station on some occasions coming in second among Hispanics 18-34.  The company’s strength lies in original programming, such as music/variety shows “Estudio 2” and Trancazo Musical”, which have ranked first in their time segments among key Hispanic demographic groups and have been exported to South America and Puerto Rico.  Through a combination of recent station purchases and the success of its programming, Liberman expects the national network Estrella TV to be in 70% of US Hispanic homes by the first quarter of 2009.

Google Cafes Bring Free Internet to Latin America

Google is planning to make Internet free in Latin America by establishing Wi-Fi zones centered around Google Internet Cafes, the company recently announced.  The decision was prompted by recent statistics released by eMarketer, which show that of the 560 million people in Latin America, only 80 million are Internet users, and only six million of these use broadband.  Although the numbers have been steadily rising over the past decade, they are low compared to those in the US.  The contrast is especially sharp in regard to online shopping – 78% of the general US population shop online, 73% of US Hispanics do, while only 45% of the Latin American population use the Internet for that purpose.   Emailing is the most common use, with 100%, but it might surprise some that, what concerns search habits, only 56% of Latin Americans search for Spanish-only websites.  This indicates an eager, curious user, whose Internet habits might not be restricted by interest as much as by access.  The lack of PCs, expensive broadband, and browser defaults are obstacles that Google, having been identified as the preferred search engine among 92% of Latin Americans by eMarketer, is now determined to overcome.  The Google Café franchise would be a modern, public gathering place with coffee bars, a PC store (Google is planning a partnership with Dell for affordable computers,) training seminars, and private computer rooms.  The arrangement is a win-win, as proprietors profit from the peripheral services, while Google increases brand loyalty.

TRAVEL

Latin American Airlines: Crisis:  What Crisis?

On the heels of a reported 11.7% growth in air traffic across Latin America for 2008, Brazilian airline TAM announced it would introduce a new route with four weekly flights from Rio de Janeiro to New York this month, while Aeromexico said it planned to reactivate flights between Mexico City and Salt Lake City, Utah, where a growing Hispanic population has once again raised demand.  US carrier Spirit is now also looking into a joint venture in Colombia, and US-based Azur could start domestic Brazil operations as soon as this month.  In the face of the recent global economic downturn, these expansion beg the question – what is going on in Latin America?

A 7.7% traffic growth in September (over the same period in 2007) for the region, according to publication Flight Global, is indicative of the upward trend  the region is experiencing.  The Latin Business Chronicle, with a recent aviation article titled “Crisis?  What Crisis?”, suggests that solid economic fundamentals and strong tourism interest are helping Latin America not only weather the current global crisis, but in fact make it the fastest growing aviation industry in the world.  Billions in financing from the Inter-American Development Bank and the World Bank have helped countries in the region maintain economic growth rates.  Peru, for example, is expected to close 2008 with a 9.2% increase, according to the IMF.  Peru also reported a 17.5% increase in international arrivals in the first eight months of 2008.  Investment in infrastructure have helped tourism grow in double digit numbers throughout the region this year.  Hotel company Hilton is so confident of the regional market’s resistance, it is planning to open 150 new hotels in Latin America over the next five years. 

Of course, with this optimism comes a measure of caution.  Members of the Latin American Air Transport Association who met in Cancun the last week of November said they had not yet seen a drop in demand and considered themselves flexible enough to cope with whatever changes came in 2009, according to an article in Flight Global.  But this did not prevent them from discussing possible protection measures, which include a hiring freeze, retiring old fleets, and halting construction, in the case of LAN, of a new headquarters building.  TACA, however, promised to stick with its expansion program.  Not mentioned in either article was the new emphasis on fuel-efficient aircraft or the dropping price of jet fuel, which could have a profitable impact on the industry in 2009.

Cruise Industry Makes Waves in Puerto Rico

The island of Puerto Rico could welcome some 20,000 additional cruise visitors in the coming months with an additional spending power of up to $15 million, the Puerto Rico Tourism Company and the Puerto Rico Port Authority recently announced during a joint press conference in San Juan.  According to figures released by both entities, the Port of San Juan received 1,496,853 visitors in the 2007-2008 season, an 8.9% increase over the previous year which surpasses growth figures in that sector.  This trend has been continuous for the past three years, with an overall 15% increase from 2005 to 2008 bringing in an additional $13.8 million to the economy.  Now the trend looks set to persist with the signing in June of a $10 million Cruise Incentive Program that has already implemented an aggressive Promotion and Marketing Plan.  Efforts by the PRTC and the Puerto Rico Port Authority have also resulted in infrastructure investment, addition of new cruise lines, and new routes.  Two new additions include the Caribbean Princess from Princess Cruises and the Carnival Victory from Carnival Cruises, which will both be making San Juan their home port and further stimulate domestic growth.

Argentines Set to Rush Chile’s Beaches

Advanced travel bookings indicate that Chile could receive a surge of Argentine tourists upwards of 300,000 this summer season, making it the best summer with that visitor market since 2001 and showing that the regional tourism industry is alive and well, according to a recent report in Mercopress.  The first nine months of 2008 already showed a 10% increase in Argentine visitors to Chile, spurred on by a wide marketing campaign and favorable exchange rates.   A strengthening dollar will encourage summer vacationers to spend despite the financial crisis, stated Senatur, the Chilean Tourism Office, which cites the beach resorts of Vina del Mar in Valparaiso and La Serena as preferred destinations among Argentines.  Other draws in 2009 will be the Dakar Rally in January, co-hosted by Argentina and Chile, as well as Chile’s telescopes.  Unesco’s distinction of 2009 as the World Astronomy Year has the Andean region, with its plethora of the world’s most potent research telescopes, promoting itself with the slogan “Chile, humanity’s telescope.”

Economy and Politics

Courting Latin America

This November Russian President Dmitry Medvedev completed his first tour of Latin America, stopping in Peru, Brazil, Cuba, and Venezuela, with the expressed interest for his country to develop cooperation with the region in the areas of energy, space, transportation, and military defense, according to the World Politics Review.  The region has a special historic significance for Russia, some Latin American countries having been serious political partners and allies prior to the end of the cold war.  Naturally, this redirected focus after twenty years, in conjunction with Russia’s rising weapon sales in Latin America over the past decade, have made two other countries’ ears prick up. 

The first is China, whose own leader Hu Jintao only recently finished his own sweeping tour of Latin America, where China was voted in as a new member of the Inter-American Development Bank with a pledge of $350 million.  Key-note speeches followed and a free-trade agreement with Costa Rica, as well as a possible one with Peru.   Although China could not be easily displaced as a major trading partner – China’s trade with South America reached $103 billion in 2007, 10 times that of Russia - emerging economic powers like Brazil are welcoming Russia’s renewed interest as they seek to gain respect at the G20 table.  To that end, Latin American countries have also welcomed considerable economic wooing from Taiwan in return for counting among the 23 nations in the world to recognize the island’s sovereignty.

The second country is the US, whose virtual absence in the region for the past eight years, some argue, facilitated China’s substantial Latin American growth, and has more recently led to struggling relations with energy powerhouse Venezuela, lingering tensions with Cuba, and conflicts over drug programs with Bolivia.  Brazil’s exclusion of the US during this week’s two-day summit, which included China and Russia, is a telling sign of the rift, and no doubt encouragement for Russia to continue aiming political efforts at the region.  There may be hope, however, as Latin American countries have reacted positively to the incoming US administration, according to a Washington Post report.  The new administration could yet play a major role in deciding the direction of the region’s foreign ties.  Cuba, for example, did not express interest in defense issues during Medvedev’s visit, but focused on economic and diplomatic ties, as the island nation seemed reluctant to damage relations with the future US president, whose swift selection of his national security and foreign relations team is a strong indication of his priorities. 

The Washington Post article goes on to argue that Russia’s lack of support in Europe should also not be underestimated.  Europe’s influence in the region is significant, its trade with Latin America amounting to some $250 billion, while the US trade, though slowing, still exceeds $500 billion. Comparatively, Russia’s target is $20 billion by 2020.  As such, Russia’s interest in the region, according to the Post, must be regarded momentarily as more nostalgic than anything.  Tours of Havana and maritime exercises in the Caribbean certainly have their historic overtones, but not quite the same impact.  The article cites a rather silly incident upon Medvedev’s arrival in Venezuela, his shortest visit, where a minor scuffle between presidential security guards erupted on account of neither speaking each other’s language. 

Latin American Leaders Propose Joint Monetary Zone

In a move to reduce dollar dependency and the international financial crisis, several Latin America leaders have agreed to create a joint monetary zone, reported Dow Jones in the last week of November.  Leaders of Venezuela, Ecuador, Bolivia, Nicaragua, Honduras, and Dominica met during a one-day meeting of the ALBA trade alliance, during which proposals to create their own regional bank and a unifying currency were made.  Venezuelan President Hugo Chavez suggested the new currency be named “sucre’, an acronym  for Unified System of Regional Compensation.  The sucre is incidentally Ecuador’s former currency, named after Latin American independence hero Antonio Jose de Sucre.  ALBA participants also supported Ecuador’s decision to contest $3.8 billion of its foreign debt.  Left leaning governments have recently sought to distance themselves from international entities like the IMF, World Bank, and the Inter-American Development Bank, based out of Washington.  No word yet on Mercosur’s reaction to this latest proposal. 

General Interest

Humanitarian of the Year Shakira Helps Poor Children

Colombian Superstar Shakira was recently named “Humanitarian of the Year” by People en Español Magazine for her work towards bettering the lives of needy children in Latin America.  The singer-songwriter has been actively involved in charity work for years, citing her own childhood experiences of poverty as inspiration.  Shakira tells People of when she was seven years old and her family had to sell all their possession because their business failed.  When Shakira cried about having to sleep on the floor, her mother took her to see the homeless children living in the park of Baranquilla.  Her rise to fame led Shakira in 1997 to establish the foundation Pies Descalzos, which helps build schools in Colombia.  More recently, she created together with Alejandro Sanz and Miguel Bose the organization Latin America in Solidarity (ALAS – “wings”), which has held charity concerts and draws considerable financial donations from across the entertainment and music industry.  In addition to this, she has participated in a variety of other fundraising performances.  She is a UNICEF Goodwill Ambassador and was recently ranked in the Top 50 Most Charitable Celebrities by OK! Magazine, having donated some $40 million to natural disaster victims, in addition to her sizeable annual donations. 

Brazil to Reduce Amazon Deforestation by 72%

This month the Brazilian government announced a new plan to reduce the Amazon’s deforestation by 72% by 2017, Associated Press recently reported.  The new proposal boosts federal forest patrols, the replanting of 5.5 million hectares of forests, and the financing of sustainable development projects as an alternative to illegal logging.  Although Amazon preservation has been an especially important issue in 2008 amid growing concerns over global warming and the climate crisis, this constitutes Brazil’s first concrete plan to slow the Amazon’s destruction.  According to the report, government efforts in recent years succeeded in reducing deforestation by 60% between 2005 and 2007, but rising soy and beef prices in 2008 prompted desperate farmers to begin carving into the forest illegally once again.   At stake is not just the Amazon’s contribution of oxygen into the atmosphere.  Deforestation by burning releases 400 million tons of carbon dioxide into the air each year and accounts for 55% of Brazil’s gas emissions, the sixth highest in the world.

New Industry Contacts you can use to further your promotional efforts in Latin America:

Pete Garcia, Consultant, International Development:  www.petegarciainternational.com

Camila Almeida, US-based representative for Caras, Brazil: camila@caras.com.br

Michele Revuelta, Public Relations, Michelle@mrprinc.com