April 1, 2009        www.LatinEPR.com 

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Carola Perla, Editor

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LATIN AMERICA - NEWS BRIEFS

 

Media and technology

 

Latin America Fastest Growing Internet Region

Latin America is the fastest-growing Internet region from a revenue perspective, Google executives recently announced, adding that Google could  soon double in size within the region.  Pyramid Research for Google have forecasted that the regional residential base of Internet users will reach 160 million in five years from the current 100 million, with applications like email and social networking driving up usage.  According to the study, 87% of Latin Americans log on to the Internet through their desktop PCs, increasingly making use of less traditional activities such as bill paying, online banking, and shopping.  At the moment, only 3% access the Internet via PDA, but 22% use laptops, and rising usage rates are giving online ad firms such as Google, Yahoo! and AOL a sense of confidence in the face of economic downturn.

TOURISM

AeroMexico Enters Medical Tourism

 

AeroMexico has become the new face of medical tourism to Latin America, following a new partnership as a preferred airline with the Medical Tourism Association, according to the New Mexico Business Weekly.  The Medical Tourism Association, a nonprofit group of international hospitals, healthcare providers, and affiliated companies, chose AeroMexico on the basis of its high number of non-stop flights from the US to Mexico and for its connecting flights to other Latin American cities.  According to the Medical Tourism Association, Latin America is on the verge of becoming one of the top destinations for US patients, a lucrative position in light of recently released figures from the “Deloitte Report, Medical Tourism: Consumers in Search of Value”, which projects that as many as 23 million Americans could be travelling and spending $79.5 billion annually for medical care abroad by 2017. As early as 2010, the number of US patients choosing medical treatment outside the country is already expected to jump from the current 1.5 million to 6 million.

 

Tourism Spending Surprises in Uruguay

 

Tourist spending in Uruguay for the month of January was up 40% from the same month in 2008, despite arrival numbers remaining relatively similar, according to figures from the Chilean Ministry of Tourism recently published by Focus on Travel News.  The estimated total tourism revenue for January reached $270 million, even though arrivals stood at a consistent 315,000.  Statistics also show that while Punta del Este has remained the most popular vacation destination, increased interest is bringing affluence to lesser-known places like Colonia del Sacramento, Piriapolis, and Rocha.  Minister Hector Lescano told media he was encouraged by the growth, particularly in the current economic climate.  Even more surprisingly, the increase has taken place just as the average length of the stay is reduced to ten days – a decade ago, the same visitors remained in the country for three to four week holidays.

 

New Lima-Havana Flight Part of Cuban Tourism Boost

 

In March, Taca Airlines inaugurated a new route between the Peruvian capital of Lima and Havana, Cuba, reported the ACN news outlet, marking a new phase in Cuba’s connectivity to the rest of the region.  According to the Cuban Tourism Ministry, the island nation has already seen a 5.2% growth in visitor arrivals in the first two months of 2009, compared to the same period the previous year, and the new Lima route, scheduled to operate 3 times a week, could add an additional 50,000.  In line with this upsurge, Cuba is investing in 3000 new hotel rooms to its existing hotel capacity.  Cuba is also hosting the latest edition of the FIT travel convention, where it expects to work on travel incentives for tourists from Germany, the event’s co-sponsor.  Close to 2.5 million visitors arrived in the country in 2008, including 45,000 US citizens, many of whom arrive via other gateways.

 

 eCONOMY AND POLITICS

 

Possible $280 Billion Injection into Inter-American Development Bank

 

US Treasury Secretary, Timothy Geithner, announced this past week that his department will be studying a proposal to infuse $280 billion into the Washington-based Inter-American Development Bank, Forbes reported.  This injection of funds, the first since 1994, would essentially triple the organization’s capital, but is dependent on conditions of good governance, a focus on alleviating poverty, and environmentally sound policies.

 

The US is the largest of the bank’s 48 member/shareholders with 30%, translating into a $2.16 billion cash contribution in the proposal – the 4% contribution of each member country would be supplemented by guarantees.  With this money, the IADB hopes to be able to disburse a record $18 billion in loans in 2009 alone.  However, detractors in Washington, including the Bank Information Center, accuse the IADB of a lack of transparency and cite loans that have contributed to serious ecological disasters.  The president of the IADB, Alberto Moreno, not surprisingly disputes these assertions and claims the bank’s level of accountability has risen since he was elected in 2005. 

 

Either way, leaders of major Latin American economies like Mexico and Brazil, having begun to feel the effects of the global crisis, are supporting the proposal.  And it seems they have China in their corner – the newest member of the IADB, China increased trade with Latin America by 40% last year for a total of $140 billion, and according to the Forbes report, plans to insist on a bigger voice for emerging economies at April’s G20 Summit in London.

 

Progress at the 6th Progressive Governance Conference in Chile

 

This past March, international leaders, including US Vice President Joe Biden, British Prime Minister Gordon Brown, Brazilian President Luiz Inacio Lula da Silva, and Argentine President Cristina Fernandez de Kirchner, convened in Chile for the 6th annual Progressive Governance Conference, which addressed among other topics, regional unemployment, the Cuban Embargo, and the sovereignty of the Falklands.   

 

Hailed for his message of cooperation and reopened dialogue, Vice President Biden spoke of a new era in the US’ relationship with Latin America, in which it would no longer dictate unilaterally, but work in partnership with the region.  The quest to improve relations began earlier in the month, when the US lauded Brazil and Mexico on their climate change actions during international climate talks in Bonn, Germany.  During the Chile conference, Biden also discussed a shift in policy towards Cuba with regards to loosening commerce and travel restrictions, but stopped short of announcing a lift to the decades-old embargo.  In addition, the US succeeded in resolving a dispute over beef exports to Chile – the need for robust trade seeing exports resume after a six-month suspension. 

 

In other talks, Brown and Fernandez de Kirchner clashed over whether or not to open a serious dialogue in the Falkland Islands debate, as mandated by the UN, but managed to make headway in agreements on flights between Argentina and the islands.  And the OAS – Organization of American States – discussed the possibility that grassroots protests would flourish in the region as unemployment grows due to the economic crisis.  Despite possible social mobilization, the OAS urged countries not to fear the worst – politically, the region is equipped as never before to deal with such conflicts, as it is experiencing an unprecedented level of stability.  For the first time in modern history, all 34 heads of Latin America’s governments are democratically elected.

 

On another note, Vice President Biden continues to travel to Latin American trade partners in preparation of the G20 Summit.  Immediately following the Chile visit, Biden arrived in Costa Rica, where he is currently meeting with leaders from across Central America and discussing among others, US deportation rates and the 5th Summit of the Americas in Trinidad & Tobago later this April. 

 

El Salvador: President-elect Funes Joins Ranks of Leftist LatAm Leaders 

 

Former television journalist and FMLN party representative Mauricio Funes took 51% of the votes in El Salvador’s mid-March presidential elections to become the nation’s first left leader in twenty years, according to the Washington Post.   The FMLN – Farabundo Marti National Liberation Front – is built by former guerillas and communist fighters who battled the country’s right wing government from 1980 to 1992, but Funes is regarded as a moderate who has pledged to turn El Salvador into Central America’s most dynamic economy, promote social equality without reversing privatizations, and strengthened relations with the US.  Although opponents accuse Funes of being a popular figurehead for hardliners within the FMLN who aim to align the country with Venezuela’s Hugo Chavez, the US State Department has already voiced support over Funes’ appointment, declaring the election very “free and fair”. 

 

GENERAL INTEREST

 

Mexico Shows Sharpest Living Cost Decline

 

Mexico has displayed the sharpest drop in living cost in the region, according to a recently released Economist Intelligence Unit Cost of Living Survey.  The survey, published in Mercopress, demonstrates the global shift in living cost that recent exchange-rate movements have caused, and calculates city rankings by adjusting the last price survey conducted September 2008 (based on parallel rates) with February 2009 official rates.  Results show that Mexico experienced the sharpest fall of all global cities surveyed, dropping 36 places to 97th.  Rio de Janeiro and Sao Paulo, previously the most expensive cities in the region fell some 23  index points, while Asuncion, Paraguay, became the cheapest in Latin America.  As the ranking is customarily determined by a combination of local prices and exchange rates, decline was on the whole more dramatic for expensive cities, where unstable rates affected previously strong currencies.  Conversely, dollarized economies which had suffered from a weak US dollar found themselves on the rise.  Panama and Ecuador, for example, rose by 12 places to a joint 108th.  Strengthened currencies also had Caracas climb into 21st place, becoming the most expensive city in the region, above New York.  Guatemala follows in 67th. 

 

While Mexico’s ranking may mean a bargain for visitors, the Mexican government is trying to find ways of shoring up the peso to prevent its sharp decline since last October.  According to Bloomberg, President Felipe Calderon may seek $40 billion in aid from the IMF to help stabilize his country’s currency.  The Mexican peso declined 32% in the past six months, however rates for March 2009 are showing a 7.6% gain against the US dollar and the Bolsa index advanced 10.6% this month, the highest monthly gain in three and a half years.  But uncertainty lingers in other areas – declining remittances, a trade conflict with the US over barred Mexican delivery trucks, and the ongoing drug war which not only threatens tourism revenue through safety concerns, but taints Mexico’s image at large.

 

Richard Gere Campaigns for Galapagos

 

This past month, American actor Richard Gere offered to speak out publicly for the conservation of the Galapagos Islands upon touring the area with his wife, reported the Associated Press.  The archipelago’s beauty as well as the persistent threat felt from tourism and development inspired Gere to throw his star power behind the cause.  Ecuadorian television captured Gere meeting Lonesome George, the last living example of the Geochelone abigdoni tortoise species, no doubt an emotional factor in Gere’s decision to add the Galapagos to his roster of humanitarian and environmental advocacy efforts. 

 

Brazilian Judge touched by Guinean Stowaway’s Football Dream

 

A judge in Salvador, Brazil, who recently presided over the deportation case of a 17-year old Guinean stowaway was touched by the boy’s dream of becoming a Brazilian football star and gave him a tour of his city’s football culture, according to the Associated Press.  The orphaned Guinean teen, who traveled in a cramped machine room inside a cargo ship was discovered by the Italian crew upon emerging for fresh air, and was turned over to federal police, but Judge Salomao Reseda could not ignore the boy’s expressed dream of playing professional football in Brazil like his idols Kaka, Robinho, and Ronaldinho.  Reseda took the teen that very weekend to watch a packed championship game between Feirense and Bahia, which the boy described “as the most beautiful thing I ever saw”.  A visit to the Bahia team’s training center followed as well as plans to take him for tryouts.  Reseda said that if Bahia or any other Brazilian team took an interest in sponsoring the boy, they could help him with a visa to return to Brazil legally.