Welcome to our weekly roundup of news from South America.
Mosoj ESG provides information, data and analyses relating to South America integrating Environmental, Social and Governance topics to promote sustainable development.
The virus never sleeps
This week, the U.K. announced a ban on incoming flights from all South American countries and Portugal, due to the emergence of a new coronavirus variant in Manaus, northern Brazil. This new variant is thought to be more potent and transmissible.
Elsewhere in the region, the rolling 7-day average data shows most countries have been for some weeks in a second wave of the pandemic, and several countries have broken records of new daily cases.
Daily new confirmed cases, rolling 7-day average.
Source: Johns Hopkins Coronavirus Resource Center
As such, most countries have started to implement some measures ranging from school closures, to working from home or restricting gatherings.
Specifically, stay at home orders vary across and within countries, with a combination of mobility restrictions (i.e. Colombia assigns daily permission based on personal ID number), sectorized and/or full lockdowns.
Stay at home restrictions, Jan 14, 2021
Source: Our World in data
Governments are thus once again facing difficult choices involving a trade-off between health and economic considerations, with very little appetite for full lockdowns, given last year’s catastrophic economic consequences.
A solution is however on its way. To date, we estimate that around ca. 519 million vaccine doses were ordered and are to be administered to ca. 259 million people, or ca. 60% of the population in South America.
Source: Government websites and press searches - Covax is a WHO initiative
This is probably not enough and there are some concerns about (i) the efficacy, (ii) the logistics and (iii) timing. So far, only* Chile and Argentina started their immunization plans with close to 400,000 doses given - mostly Chile with 346,687 doses.
As vaccination rolls out, prioritized groups include front line healthcare workers, those aged >70 (or 60), and those with underlying health issues. Also, essential workers in key areas (such as logistics), teachers and armed forces (!) will also join the first stages.
To date, we estimate a total vaccine cost of $ 5.1 billion, or around $27 per person (2 doses), excluding logistical and human resource costs. Of note, Peru accounts for a disproportionate amount as it bought from China Sinopharm - the most expensive vaccine, given uncertainty and timing of supply from other providers.
Source: Mosoj ESG estimates
Indeed, the Oxford vaccine supply may not arrive in South America before September 2021, which means vaccinations are likely to run well into 2022. This may prove too little and too late, and a continuous danger to the economy of the region, if not global.
As such, the region is once again facing healthcare system collapse - already evident in several cities, and with the prospect of full lockdowns rising, another economic shock should not be be ruled out, with dramatic socio-economic consequences.
*On Sunday 17th, Brazil gave its first coronavirus vaccine to a Nurse from Sao Paulo.
Ford’s departure from Brazil will have a $4.1bn impact
Government eases collection of $55.5bn in debts
Bankruptcy petitions jump 12.7% in 2020, says Boa Vista
Banks add $620bn in credit during the pandemic
BNDES approves $740mn to build a thermoelectric plant in the Port of Açu
New Fortress enters Brazil’s natural gas market with $5bn acquisitions
Acacia accepts $4.5bn offer from Cisco
Solfácil intends to launch FIDC and finance $186 mm in 2021
Brazil’s agro exports exceed $100bn by 2020
Revenues from coffee in Brazil reach more than $6.2bn
Banco do Brasil to close 112 bank branches across the country
Maersk projects 20% growth in Brazil by 2021
Inflation reached 36.1% in 2020
YPF: creditors qualify as hostile the offer to restructure the $6.6 bn debt
Cordoba’s government successfully restructures $1.7bn in debt
Construction: more than 70% of the works returned to their usual pace
The government raised $659mn in the first financial auction of the year
The government wants to keep income tax at 30% in 2021
Moody’s Local Argentina warns of rising bank defaults in 2021
YPF added 3,747m3/d to its hydrocarbon production at Manantiales Behr
Argentinean meat exports to China grow 10% compared to 2019
Central Bank Survey projects 5% increase in GDP
COVID-19: Productivity in Chile fell by 0.7% in 2020, while sales were down by 18%
Bankruptcy filings increase by 8.1% in 2020
Labour fines reach $6.7mn in 2020
Chile’s SQM signs a long-term contract to supply LG with 55,000 tonnes of lithium
Cencosud announces $1.8 billion investment plan
Appian raises $775mn reaching hard cap for second mining fund
Trade Inventory Index fell by 2.9% in November 2020
Energy Efficiency Law was passed aiming at a 10% reduction in consumption by 2030
Employment subsidies: 48,468 companies have submitted 366,487 workers to the programme
Air traffic dropped by 64% in 2020
Carsol expects a positive blueberry season, with 21.9% of the fields in Chile
Grenergy and Natixis close $91mn solar PV portfolio financing in Chile
Women in business boards increase to 29% by 2020
Colombia to issue $575 mn in Green bond auctions in 2021
Colombia’s total external debt reaches a new all-time high at 54% of GDP
Informal labour in Colombia reached 48% in November 2020
Sales of Evs and hybrids in Colombia increased by 50% in 2020
Fitch Rates Colombia’s 2061 USD Bonds ‘BBB-‘
Colombia issues $1.3 bn of new global bonds due in 2061
Government of Colombia launched bonds in two tranches for $2.09 bn
Colombia produced 80% of power from renewables in December 2020
Colombia´s GEB plans $389 mn investments for 2021
EPM will sue for $ 2.8 bn as conciliation for HidroItuango fails
Procolombia announced a fund for $ 20 mn to support Colombian SMEs
International reserves fall by 18.4% in 2020, their lowest level since 2007
Asoban: With further deferrals, banking will not receive $1.8 bn
The Government imposed a 6-month pause for loans payments
Bolivia would lose $10 mn/month on gas sales to Argentina if it does not exceed minimum volumes
IBCE claims that the country loses $30 mn per day due to the transport sector strike
Smuggling causes losses of $120 million in three sectors
Price of urea rises by 40%, and imports soar by 400%
Santa Cruz regional government warns that $1.2bn of export revenues are at risk
Forest exports increased by 16.3% despite the COVID-19 crisis, reaching $64mn
Bolivia achieved a $99.5 million trade surplus in November