Walmart Inc. has dialed back its global footprint this year -- retreating from Brazil and merging its U.K. business with a rival. But while the world’s largest retailer is stepping away from some high-profile international markets, it’s doubling down in a region that gets less attention -- Central America.
Walmart’s business in Guatemala, Honduras, El Salvador, Nicaragua and Costa Rica is a growing part of the retailer’s publicly traded Mexican and Central American business, Wal-Mart de Mexico SAB, or Walmex. The region now accounts for almost one-fifth of Walmex’s revenue, up from 14 percent in 2014.
Over the same period the retailer has added more than 100 Central American stores, ranging from small bodegas to Supercenters, all of which tout the company’s mantra of everyday low prices. While Mexico has been a bright spot for Walmart pretty much since Sam Walton opened a location there in 1991, Central America represents a more fertile area for growth, analysts say.
Walmex has added more than 100 stores in Central America in recent years
“Mexico has almost always been much more profitable than the other parts of Walmart,” Dave Marcotte, an analyst at Kantar Retail, said. “They have best-in-class concepts and processes in place in Mexico to roll out into Central America.”
Walmart is pulling back from markets where it hasn’t been able to grow, such as Brazil, in order to refocus on big bets such as India and China. While the company’s operations in Central America contribute only a small amount to revenue, they fit the model of doubling down on higher growth regions.
Central America has increasingly helped fuel Walmex’s earnings before interest, taxes, depreciation and amortization while the parent Walmart has seen declines due to the massive investments the retailer is undertaking to grow its U.S. e-commerce business and fend off Amazon.com Inc.
But the path to expand online sales -- largely virgin territory in Central America -- is clear for Walmart, since Amazon is only just arriving and Latin American e-commerce firms MercadoLibre Inc. and B2W Companhia Digital are mostly focused on South America.
Walmart may get a further boost if Central American economies expand as expected: The International Monetary Fund forecasts growth of 3.9 percent this year and 4 percent in 2019. That’s more than twice the pace of South America’s growth.
The retailer’s sales in Central America more than doubled to 107.4 billion pesos ($5.2 billion) in 2017 from 49.7 billion pesos in 2011. That outpaces the 41 percent growth over the same period for Walmart’s Mexico business and growth of 19 percent in the U.S.
Date | Fecha: June 15, 2018
Source | Fuente: Bloomberg
The World Bank granted a $100-million loan to Panama to strengthen international tax transparency, financial integrity and tax management, and improve social assistance and education programs.
The Ministry of Economy and Finance reported that the loan was signed by the Acting Minister of Economy and Finance, Gustavo Valderrama, and by the Country Manager of the World Bank, Abel Caamaño.
This $100-million loan agreement will finance "the Third Shared Prosperity Development Policy," the ministry said in a public statement.
The resources will support Panama to "continue advancing" in the development objectives referred to the "strengthening of the frameworks for international tax transparency, financial integrity and tax management".
The resources are also to "strengthen the institutional arrangements to support inclusion in social assistance and education, as well as improve the regulatory framework and sustainability in the energy sector," according to official information.
Date | Fecha: July 21, 2018
Source | Fuente: Panama Today
Second-quarter growth strengthens on upbeat industrial metrics
Available data suggests that the Central America and Caribbean economy picked up speed in the second quarter as early-year trends in industrial activity and remittance inflows firmed up. Regional growth appears to have gotten back on track following a subdued start to the year and is estimated to have clocked in at an upbeat 2.3% year-on-year. Meanwhile, more comprehensive data now pegs the first quarter’s expansion at 1.9% annually, up 0.1 percentage points from last month’s preliminary estimate. Notably, most economies in the region appear to have ramped up activity through the first half of the year. That said, regional growth was held back by Puerto Rico, which has been mired in a years-long recession most recently exacerbated by last year’s deadly hurricane season; excluding Puerto Rico, growth in the second quarter looks to have been the region’s strongest outturn in more than a year.
Although second-quarter national accounts data has yet to be released for most of the region’s economies, leading metrics suggest an upturn across its major economies. In the Dominican Republic, the region’s standout performer and one of its heaviest hitters, growth surged in the second quarter as duty-free manufacturing zones facilitated a rapid increase in output. Meanwhile, a buoyant tourism sector—bolstered by a booming U.S. economy—continued to underpin employment gains and construction activity. In both Guatemala and Costa Rica, leading data suggests similar trends were at play in the quarter; domestic demand appeared to strengthen on solid manufacturing gains in Guatemala, while in Costa Rica the ongoing and rapid recovery of the construction sector appears to have lifted second-quarter growth amid the fading of political uncertainty. On the other hand, and although Panama is expected to have grown at a slightly more upbeat pace in the second quarter, labor strikes through May are seen eating into economic activity.
Throughout the region, remittance inflows have been flooding into economies as the increasingly tight U.S. job market has delivered strong real wage gains. In June, remittances in Guatemala continued to break records as the 12-month trailing sum hit USD 8.5 billion—a substantial 10.9% gain from a year earlier. Along with rising tourism dollars, these transfers are supporting household spending and international reserves across the region. Moreover, they have become increasingly vital to the region’s economy as it faces a growing imported fuel bill and to consumers grappling with rising fuel costs.
In politics, ongoing protests in Nicaragua have left scores dead and the economy reeling. So far, economic losses have been estimated in the hundreds of millions of dollars, and dialogue between President Daniel Ortega and his critics has thus far proven fruitless. In seeking an end to the crisis, Ortega recently raised the possibility of UN-mediated resolution, although no clear path forward has yet appeared. In Haiti, protests broke out in July in the wake of an IMF-backed fuel price hike. The instability, which crippled economic activity, also brought down Prime Minister Jack Guy Lafontant on 14 July.
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Firm U.S. growth bodes well for regional growth this year
Looking ahead, the region’s economies will continue to realize gains this year from the strength of the U.S. economy, which is expected to continue benefiting from fiscal stimulus over the short term. As the labor market in the U.S.—the Central America and Caribbean economy’s largest trading partner, by far—continues to tighten this year, remittance inflows and tourist dollars are expected to pad household incomes across the region. Moreover, buoyant U.S. demand should prop up exports, which will help offset the region’s growing imported fuel bill. Recovery efforts in Puerto Rico will continue in earnest as electricity is restored and federal aid reaches the island’s shores. Downside risks include faster-than-expected tightening by the Fed, which will put pressure on regional credit growth and investment. Moreover, stricter U.S. immigration policy, if finally enacted, could upset the recent surge of remittance inflows.
FocusEconomics panelists expect regional growth of 2.0% this year, which is unchanged from last month’s forecast. An upgrade to the Dominican Republic’s full-year growth estimate, following a stellar second quarter, offset slashed growth estimates for Costa Rica, Guatemala, Nicaragua and Panama. Along with the Dominican Republic, only Puerto Rico saw its short-term outlook revised upward. Meanwhile, two additional economies had their growth estimates cut in August, while four economies saw no change to their short-term outlook. Next year, regional growth is seen accelerating to 3.7%.
Dominican Republic and Panama are expected to log the region’s fastest growth this year, with both economies expanding close to 5.0%. Conversely, Puerto Rico is expected to be the region’s worst performer, contracting 6.8% in FY 2018.
GUATEMALA | Domestic demand to drive growth in Q2
Economic activity is expected to have picked up pace in the second quarter, recovering from the first quarter’s multi-year low. The average reading of the Central Bank’s monthly economic activity index in April and May trended above the average reading recorded in the first quarter. Indeed, growth in economic activity reached the highest level in April since October of last year. Data for April and May pointed towards a robust manufacturing sector, while the financial sector and wholesale and retail trade also chipped in. Moreover, annual growth in remittances in the second quarter more than tripled the first quarter’s pace of expansion. In USD value terms, remittances reached the highest monthly level on record in May. In June, confidence in the economy increased after two consecutive drops on the back of a rosier view on the current economic situation and in the next six months.
The economy is expected to shift into a higher gear this year, thanks to robust domestic demand. A tight labor market and strong remittances growth should support household consumption growth, while government expenditure is likely to increase sharply due to infrastructure spending. However, downside risks include potential political and economic uncertainty in the lead-up to next year’s presidential elections. FocusEconomics Consensus Forecast panelists expect the Guatemalan economy to expand 3.1% this year, down 0.1 percentage points from last month’s estimate, and 3.3% in 2019.
DOMINICAN REPUBLIC | Growth soars on manufacturing gains in Q2
The economy continued to surge in Q2, underpinned by double-digit expansions in the duty-free manufacturing and construction sectors, and a solid performance in the commerce sub-sector. Strong economic activity in recent quarters translated into healthy year-on-year formal employment growth in Q1 and a lower unemployment rate. Moreover, the number of tourist arrivals expanded robustly in Q2, while fiscal receipts increased by nearly 15% in the year to May. On the other hand, the external sector has weakened so far this year: Higher oil prices pushed up the import bill and led the trade deficit to widen. On 12 July, the country issued USD 1.3 billion in international bonds. This should bolster international reserves—which dipped notably in recent months—and help satisfy dollar demand.
Growth will likely dip going forward but remain healthy, supported by fixed investment and a strong U.S. economy, which will boost remittances, exports and tourism activity. However, tighter monetary policy will dampen activity. The vulnerable fiscal position, with elevated debt servicing costs and a narrow tax base, poses a downside risk. FocusEconomics panelists expect GDP growth of 5.2% in 2018, which is up 0.1 percentage points from last month’s forecast. For 2019, panelists see the economy expanding 4.5%.
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PANAMA | Economic activity hit by labor strikes in Q2
The latest available data indicates that economic growth likely remained sluggish in the second quarter, after hitting an over seven-year low in Q1 due to weak showings from the construction and trade-related sectors, which likely continued in Q2. In May, the Economic Activity Index (Indice Mensual de Actividad Economica) reached a nine-year low, hampered by a month-long union strike that ended on 18 May and brought the construction sector to a virtual standstill. Furthermore, social unrest remained high heading into Q3: There were widespread protests in June and July against a planned hike of electricity prices—backed by the IMF—which has for now been suspended.
Widespread labor union strikes and the completion of large-scale infrastructure projects should mute growth in 2018. Prospects look brighter in 2019 thanks to the opening of a large copper mine and a likely pick-up in construction activity. The country, however, remains vulnerable to an escalation of global trade tensions, a key downside risk which could disrupt the export-oriented sectors and activity in the Panama Canal. FocusEconomics Consensus Forecast panelists project that the economy will grow 4.9% in 2018, which is down 0.1 percentage points from last month’s forecast. They expect GDP will expand 5.2% in 2019.
COSTA RICA | Recovery of the construction sector to bolster growth in Q2
The economy improved in recent months, after annual growth moderated to an over four-year low in the first quarter of 2018. A fast-recovering construction sector and a strong information and communications sector helped economic activity to increase at the fastest pace in over two years in May. However, from January to May, the accumulated fiscal deficit grew to 2.8% of GDP, 0.2 percentage points more than in the same period last year. Furthermore, instability in Nicaragua has created an element of uncertainty. Over 20,000 Nicaraguans have sought refuge in Costa Rica since April, according to the United Nations. Given that Nicaragua is positioned between Costa Rica and El Salvador, the two countries accelerated preparations for a ferry link in July to help mitigate disruptions to bilateral trade.
The swearing-in of President Carlos Alvarado and the new representatives of the Legislative Assembly in May lifted a cloud of political uncertainty, which should benefit the economy going forward. However, despite recent legislative efforts, a persistent fiscal deficit and high public debt will continue to weigh on prospects, as could escalated instability in Nicaragua. Our analysts expect GDP to grow 3.2% in 2018, which is down 0.2 percentage points from last month’s projection, and 3.4% in 2019.
INFLATION | Inflation stable in June
According to a preliminary estimate produced by FocusEconomics, regional inflation was 3.4% in June, stable from May’s reading. Inflation jumped in Nicaragua, where ongoing protests have hampered economic activity. Meanwhile, inflation ticked up across most of the region on rising fuel costs, including in Costa Rica, the Dominican Republic and Panama. On the other hand, price pressures eased in Guatemala.
Moderate inflation left most of the region’s central banks room to keep rates on hold in recent weeks. In Costa Rica and Guatemala, officials held tight amid contained price pressures. On the other hand, in the Dominican Republic, officials hiked rates as concerns over the pace of the Fed’s tightening grew. Meanwhile, if all goes according to plan, inflation-targeting will become the Bank of Jamaica’s new policy framework later this year when legislation is tabled in parliament.
As a net energy importer, inflation in the Central America and Caribbean region will be driven higher this year by rising international oil prices. FocusEconomics sees inflation coming in at 3.3% in 2018, which is unchanged from last month’s forecast. For 2019, FocusEconomics expects inflation to remain stable at 3.3%.
Date | Fecha: August 8, 2018
Source | Fuente: Focus Economics
Nicaragua can, for now, continue to export bananas to the EU at the currently favourable import tariffs. This, despite exports from this country exceeding the set 14.000 tonnes threshold in April. According to European authorities, the larger volume of bananas from Nicaragua are not disrupting the European market. This was made known by the European Union (EU).
In 2013, the EU signed a treaty with a number of Central American countries. This was done in order to regulate the banana market. Nicaraguan exports have fallen under this agreement since 1 August 2013. According to the arrangement, the EU can begin an emergency procedure if necessary. This can be done if a certain limit is exceeded. Hereby, preferential customs regulations of the country concerned can be suspended. This year, on 10 April, the exports from Nicaragua to the EU exceeded the established threshold of 14.000 tonnes.
The EU has decided not to suspend the preferential customs duty. The stability of the European banana market was one of the factors taken into consideration when this decision was made. Bananas from Central American countries represent only 1,2% of the European banana imports to which the treaty applies. Nicaragua's share of the total European imports of bananas is 1%.
This county's position is in contrast with the shares of the other countries included in this accord. The supply from the three largest banana exporters has not nearly reached the threshold - Colombia (17,8%), Ecuador (23,4%), and Costa Rica (22,2). This means the 'unused' volume within the stabilising mechanism is about 4,8 million tonnes. This is much less than Nicaragua's total imports to date (14.787 tonnes).
The EU also did not see any effect on the market price. Despite the larger volumes from Nicaragua, banana prices in Europe remain high. In March 2018, bananas recorded a price of EUR1.094 per ton. This was regardless of origin. That is 11% higher than the price in the same month a year earlier. The average wholesale price for European bananas is at EUR1.006 per ton. This is comparable to the price in March 2017 (EUR996/ton).
Based on this analysis, the EU stated that there was no reason to suspend Nicaragua's lower import costs. Last year, this country exceeded the threshold in May. Imports from Nicaragua totalled 50.000 tonnes for the whole of 2017.
Date | Fecha: 20 de junio, 2018
Source | Fuente: Fresh Plaza
La Asociación Guatemalteca de Exportadores (Agexport) expuso que se creará la Mesa de Asia, para impulsar las ventas de productos nacionales, un esfuerzo conjunto con las empresas nacionales, con la intención de determinar las tendencias de productos demandados, tener perfiles de empresas y abrir brecha para empresas nacionales.
Paola Álvarez, Gerente de Promoción y desarrollo de mercados Agexport dijo que parte de esa labor ha sido trabajar en conjunto con diferentes organizaciones, incluyendo con la embajada de Taiwán, para enviar a representantes de diversas empresas a ferias de sectores de alimentos y productos diversos en busca lograr más negocios y aumentar las exportaciones.
Hay productos de alto potencial y Taiwán es la puerta para que los empresarios puedan entrar al mercado asiático, a esa región no solo esperar entrar por Japón o China Popular agregó Álvarez.
La ejecutiva considera que las empresas tienen oportunidades de entrar a competir al mercado asiático pero deben prepararse.
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El fin es enviar empresas para abrir brecha, detrás de ellas podrán aprovechar los mercados muchas más, agregó.
Eugenia Yang, consejera económica de la embajada de Taiwán en Guatemala, agregó que las tendencias de demandas de productos de su país se comportan según las tendencias mundiales.
En la actualidad son demandados productos saludables como alimenticios, productos de conveniencia y además productos de belleza y de salud basados en más productos naturales, en los cuales el país tiene una oportunidad.
Necesita diversificar más
La representante refirió que ve una necesidad de que Guatemala necesita diversificar más su oferta de exportación.
“Hay muchas oportunidades en Taiwán. Taiwán es una plataforma donde el empresario puede aprovechar esta feria a nivel internacional, y ahí uno busca oportunidades y no solo hace negocio con los taiwaneses, sino con otros países como empresas en China, en otros asiáticos, y otros como Estados Unidos y Europa” agregó Yang, pero recomienda que tiene que ser agresivos y estar preparados para explorar los mercados.
Gabriel Biguria, gerente de Acuamaya, refirió que Asia tiene 4 mil 400 millones de personas y un alto poder adquisitivo donde se tiene la oportunidad de posicionar productos guatemaltecos y entender la importancia de participar en ese mercado. “¿Qué más vamos a esperar cómo país para apostarle al mercado asiático?” expresó Biguria.
La embajada de Taiwán y Agexport apoyan a una delegación de cinco empresas para participar en la Feria Food Taipei la próxima semana, aparte de Acuamaya (productora de camarón), asistirán Alimentos Selectos, S. A. (macadamia, miel de abeja, café), Apsa Export (chía), Corporacion Yehudá (amaranto, cacao, miel y café), la Asociación de Agricultores el Esfuerzo de San Pedro Necta (café).
Se trata de la vigésima octava edición de Taipéi International Food Show, reconocida como “Food Taipei”, una de las ferias del sector alimentario más grande de Asia, que se efectuará del 27 al 30 de junio.
Ésta se lleva a cabo simultáneamente con Foodtech & Pharmatech Taipei, Taipei Pack, Taiwan Horeca y Halal Taiwan. En conjunto, en el 2017 tuvo récord de 1 mil 717 expositores, 4 mil 011 stands y 61 mil 803 visitantes.
Las exportaciones de Guatemala hacia Taiwán se han quintuplicado en los 11 años de vigencia del Tratado de Libre Comercio, y llegó a US$76.5 millones en el 2017.
Empresarios en Guatemala han detectado al menos cuatro tipos de productos que se pueden exportar a Taiwán debido a la demanda que tienen.
Date | Fecha: 19 de junio, 2018
Source | Fuente: Prensa Libre
La planta de gas natural licuado Energías del Pacífico (EDP) comenzará a funcionar apartir del 2021, la construcción arrancará en el tercer trimestre de este año en la zona de Acajutla. La empresa ya tiene las factibilidades y permisos, solo le hace falta finalizar .
"Hemos cumplido ya con todos los requerimientos de los bancos internacionales (...) estamos apuntando a tener la firma de todos los contratos de financiamiento, que llevo un poquito más de tiempo de lo esperado por los requerimientos muy estríctos ambientales que tienen todas estas organizaciones multilaterales bancarias en el tercer trimestre de este año y de manera simultánea, empezar la construcción", dijo Alejando Alle, director ejecutivo del proyecto.
EDP, cuyo proveedor es Wärtsilä, tendrá una capacidad para generar 378 megavatios (MW), suficientes para cumplir con el contrato de 355 MW. El proyecto consiste, además de la planta, en la instalación de un barco fijo que funcionará para almacenar el gas, en el agua, el ducto para transportarlo y una línea de 230 kilovoltios (kV).
Alle destacó que se construirá una línea de alto voltaje, y no de 115 kV, como la mayoría de las que hay en el país; esto ayudará a reducir las pérdidas al transportar la energía hasta la subestación de Los Ausoles. Esto es mejor que inyectar directamente en Acajutla porque las líneas ya están saturadas con otros proyectos energéticos.
Aún asi, EDP construirá una subestación en Acajutla para poder inyectar en las líneas de 115 kV directamente, esto se hace por “redundancia”, es decir repetir las formas de transmitir la energía para respaldar en caso de fallos.
Date | Fecha: 19 de junio, 2018
Source | Fuente: La Prensa Gráfica
