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Friday, January 6, 2017

FT LatAm Viva For January 5, 2017

6:58 AM (4 minutes ago)
to me
Brace position
By John Paul Rathbone 
January 6, 2017
Latin America, like the rest of the world only with greater geographical intimacy, is bracing itself for the presidency of Donald Trump.
Mexico has a new Foreign Minister for the task. Luis Videgaray, a man with whom Mr Trump once said he could do “wonderful deals”, has been brought back after he resigned as Finance Minister three months ago following the public relations fiasco of Trump’s visit to Mexico in August.  (But is that really a good move? Eurasia, the risk consultancy, suggested it would “only worsen [President Enrique] Pena Nieto’s troubles.”)
Argentina is scrambling to get $10bn of bond issuance out of the way, seizing a moment of calm before the storm that many investors fear could hit emerging markets once Mr Trump is in office.  This will likely only be the first of many mega issues as the country has to issue as much as $30bn this year.
Companies are assuming the brace position too. General Motors has been put on notice by Mr Trump for investing in Mexico. Ford has shifted one planned investment. Toyota has also drawn the president elect’s ire for manufacturing south of the border.    
It’s not all Trump, though.  
Venezuelan president Nicolas Maduro has circled the wagons against Venezuela’s festering social, economic and political crises by re-shuffling his cabinet and appointing “friends and family” to top positions.
Shock waves also continue to ricochet around Latin America over the multi-million dollar bribes that Brazilian construction company Odebrecht once showered around when it acted as the quasi-industrial development arm of Brazilian foreign policy.
The flames of the scandal - which the US Justice Department last month called the biggest foreign bribery case in history - have been fanned by recent evidence submitted by plea-bargaining Odebrecht executives in return for judicial leniency in Brazil. JP (“no relation”) Spinetto, a Bloomberg TV producer, has got out the back-of-an-envelope to do the maths on bribes-paid and contracts-won; his salaciously amusing but also informative graphic is below.   
Quotes of the week
“Toyota Motor said will build a new plant in Baja, Mexico, to build Corolla cars for U.S. NO WAY! Build plant in U.S. or pay big border tax” - President-elect Donald Trump wrote on Twitter
“Production volume or employment in the US will not decrease as a result of our new plant in Guanajuato, Mexico, announced in April 2015” - Toyota
Chartwatch
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The week in review
Taiwan tries to keep Central American allies away from China
 
Beijing launches diplomatic drive in response to Trump’s overtures towards Taipei
 
 
Luxurious Belize getaways
 
Francis Ford Coppola’s new island retreat is among a swath of hotel openings encouraging visitors to explore an alternative side of the Caribbean
 
 
Argentina races to sell new dollar bonds
 
Country looks to pre-empt risk of higher funding costs and less benign market tone
 
 
Trump turns his ire on Toyota’s Mexico car plant plans
 
Company says no US jobs will be lost as president-elect continues to attack carmakers
 
 
In Mexican peso battle, it's Trump 1, Banxico 0
 
 
 
Chinese ride-hailing app Didi drives into Brazil
 
Domestic regulations and global rivalry with Uber prompt emerging markets push
 
 
Venezuela appoints new economy, energy ministers
 
 
 
Official who arranged Trump visit tapped as Mexico's top diplomat
 
 
 
Venezuelan distiller inks distribution deal with Bacardí
 
 
 
Argentina braced for new battles over cutbacks
 
Cabinet reshuffle does not overcome political obstacles to reform efforts
 
 
Mexico tries to cut a deal with Trump
 
Threat of tariffs and plant closures hangs over economy intertwined with the US
 
 
Mexican standoff looms between Trump and carmakers south of border
 
Golden years of Nafta set to end if president-elect carries out his promises
 
 
Venezuela issues $5bn in bonds as it seeks cash to ease shortages
 
Analysts say deal could unlock funds for government to pay creditors and suppliers
 
 
Trump, Putin, Xi and the rise of nostalgic nationalism
 
Beware of leaders’ pledges to build a future inspired by past glories
 
 
Mexico’s populist Amlo capitalises on economic woes
 
Anti-establishment figure hopes to follow in Trump’s footsteps and win presidency
 
 
FT LatAm Viva features commentary by the FT's Latin America team and stories from across the FT.
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