Friday, February 24, 2006

Andina Under Investigation for Oil Smuggling

From then TCR listserv:
REPSOL YPF: Andina Under Investigation for Crude Oil Smuggling

As previously reported, Spanish-Argentine oil company Repsol YPF denied allegations of oil smuggling in Bolivia through its subsidiary Andina.

Jorge Alvarado, head of Boliva's state-owned oil company YPFB, said in reports that the Bolivian government is investigating alleged oil smuggling by the company. Oil has been taken out without authorization, and for that documentation has been altered, Mr. Alvarado has said. He revealed that there are signs, according to customs, that Repsol has altered documents to take oil out of Bolivia without authorization.

According to local press, Bolivia's customs authority ANB presented formal charges, after months of investigation, against Petrolera Andina at the Santa Cruz department district attorney's office on Monday alleging that the company smuggled US$9.22 million worth of crude for export and falsified documents.

The charge states that Andina smuggled 230,399 barrels out of the country between June 2004 and July 2005, 85% leaving from the city of Yacuiba and the rest going through Arica.

With regards to the falsification of customs documents, the ANB report says that seven of the company's export declarations claimed higher export volumes than they were authorized to export by ministerial resolutions, according to local reports. Andina has denied in a statement the charges and maintains having paid all taxes and royalties. The district attorney's investigation will last six months.

Andina is 50% owned by Spanish oil major Repsol YPF (NYSE: REP), with the other half controlled by the Bolivian state.


On June 20, 2005, Moody's Investors Service upgraded the ratings of Spanish-Argentine oil company Repsol YPF's local subsidiary YPF S.A. Moody's upgraded YPF's senior unsecured rating to Ba3 from B1 and the unit's domestic currency issuer rating to Baa2 from Baa3.

YPF's foreign currency issuer rating of Caa1 remained unchanged, as it is constrained by the sovereign ceiling of Argentina. YPF's Corporate Family Rating (formerly known as the senior implied rating) is aligned with the foreign currency issuerrating at Caa1.

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Wednesday, February 22, 2006

A Documentary (About Goni): Our Brand Is Crisis

I recently got this e-mail from the Bolivian American Chamber of Commerce listserv, worth blogging about, and worth seeing:

American-Style Campaign Tactics Reborn in Bolivia;
Rachel Boynton’s New Muckraking Documentary

Film Forum is pleased to present the U.S. theatrical premiere of Rachel Boynton’s OUR BRAND IS CRISIS, beginning Wednesday, March 1, 2006. For decades, U.S. strategists-for-hire have been quietly influencing the opinions of voters and the messages of candidates in elections around the world. OUR BRAND IS CRISIS is an astounding look at one of their campaigns and its dramatic aftermath.

The filmmaker follows a crack team of Democratic political consultants, including James Carville, Tad Devine and Jeremy Rosner, as they strategize for a struggling presidential candidate in Bolivia. This thrilling adventure is a fly-on-the-wall account of the machinations behind the turbulent re- campaign of Gonzalo Sanchez de Lozada (“Goni”). In a country facing a calamitous economic crisis, Goni ¾ a wealthy businessman who privatized Bolivia's economy and created social security (when he was president in the mid-‘90s) ¾ isn't a popular candidate. Yet the consultants devise a U.S.-style campaign marked by savvy media techniques and negative ads, emphasizing a single, strong message. They reintroduce Goni as an appealing brand in an attempt to win an election whose aftermath is nothing short of devastating.

Recently Bolivia’s new leftist president, Evo Morales, has put the country back in front page news. Morales, previously a leader of the coca leaf-growers’ union, became the nation’s first indigenous leader in December. Boynton’s film is both a terrific case study in the events leading up to Morales’s win and a shocking example of how U.S. marketing strategies can affect the spreading of "our brand of democracy" overseas.

COME SEE THE FILM DURING IT'S OPENING WEEKEND, Wednesday, March 1- Sunday, March 5, at Film Forum, West Houston Street (West of 6th Avenue), with screenings daily at 1:00, 2:50, 4:40, 6:30, 8:20, 10:10. Rachel Boynton will be doing a Q&A after the 8:20 screening on Wednesday, March 1. The film is limited to a 2-week run.

“A riveting and intellectually provocative tale of clashing ethics and ideologies, as well as a portrait of a country in the midst of of profound conflict and suffering.”
Matthew Ross, Filmmaker Magazine

“The resonance of (the film) is flabbergasting… Riveting through and through, OUR BRAND IS CRISIS unravels like a political thriller.
Ed Gonzalez, Slant Magazine

OUR BRAND IS CRISIS (2005, 87 mins.) Produced and directed by Rachel Boynton. Cinematography: Tom Hurwitz, Michael Anderson, Christine Burrill, Jerry Risius. Sound: Sergio Claros, Boynton. Editing: Boynton, Jennifer L. Robinson. Music: Marcelo Zarvos. Executive Producers: Steven Shainberg, Robert Kravis, Sanders Goodstein. USA. In English and Spanish with English subtitles. A Koch Lorber Release.

See what the New York Times has to say about it by clicking here, also see the IMDb entry here.

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Tuesday, February 21, 2006

A New Energy Company is Born

This news item may be a little bit dated, but I decided to comment on it anyway, since it shows a very positive development for a long standing (formerly State-owned) company: the Ingenio Azucarero Guabirá S.A.[1] Founded in 1956, and located in the Santa Cruz department, Guabirá is one of Bolivia's oldest sugar complex companies, processing sugar cane derivates such as refined sugar, alcohol, ethanol and fertilizers, some of which it currently exports to the regional market.

The company was privatized in 1993, and currently owned partly by a number of raw material providers (who control 60 percent of voting rights) and company employees, the company is privately held and doesn't currently trade on the BVV. The company has shown very good growth with a bit of a slowdown in 2004-2005. However, Guabirá has recently launched an ambitious plan to provide electricity (starting out this year with a 16MW production capacity) using bi-products of sugar cane as a clean raw material.

The subsidiary unit it has created is named Guabirá Energía S.A, and counts with a starting capital of $US 6.5 million, which it plans to increase to $US 11 million as it generates an increased capacity of 60MW, according to the daily Correo del Sur [2]

The use of sugar cane derivates as a clean source of energy will allow Guabirá Energía S.A to trade pollution credits in accordance to the Kyoto protocol and access international financing. The company also plans to finance the expansion of 7,500 hectares of sugar cane fields to satisfy its new needs.

1.- Company website:
1.- "Guabirá invierte $6,5 millones para electricidad" Correo del Sur 15, Feb. 2006

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Tuesday, February 14, 2006

Uncovering a Niche Market: Bolivian Organic Foods

Sure, the big business news from Bolivia right now include problems with LAB, problems with Repsol, problems with El Mutún, problems with clothing imports and promises from Petrobras...Overlyy negative stuff.

However, I thought it would beworthwhilee to look at an interesting and positive news item in today's La Razón. Chapare Exporta, the agribusiness company founded by Miguel Zambrana[1] 15 years ago, has just begun banana exports to Europe. A historic landmark for a small Bolivian company given the strict agricultural protections common in the European Union. According to Zambrana the European market for bananas and its derivatesurpasseses $US 5.000 million a year, the objective of the company is to capture 10 percent of that market in the next few years. Bolivian banana exports currently cover 30-40 percent of thArgentineanan market, and with quotas and other trade barriers ineighborur countries expanding to European, Asian and North American markets seems a logical step.

On a similar step, other Bolivian agricultural companies are striving to promote their products abroad and enter new markets. Fourteen such companies will be exposing their products in the BioFach 2006 fair [2], in Nuremberg, Germany, in the next few days. Products promoted include organic quinoa, coffee, tea, medicinal herbs, dehydrated fruits, and others. Some of the companies include: Anapqui, Andean Valley S.A, AOPEB, BioCrush S.A, Coronilla S.A., El Ceibo Ltda. Irupana AOF and Hahenmann Labs.

Bolivian companies specializing in agricultural and organic products will also be present in other upcoming trade fairs, including Foodex in Japan, Agroexpo in Colombia, Interzum in Germany and Fancy Foods Show in the US.

A so it goes, slowly but surely Bolivian private enterprise has found a niche in selling high quality organic foods internationally. If only we had more free trade agreements.


[1] Some may remember Mr. Miguel Zambrana for his daring attempt of suing then congressman and sindicate strong-man Evo Morales and other MAS nomenklatura for damages caused by the constant blockades in el Chapare in past years. Week long blockades derived in months worth of production rotting in trucks on their way to Argentina, contracts being defaulted and other losses. It's surprising to see how Chapare Exporta has recovered.

[2] For a complete listing and contact addresses of many of the companies cited here, click on this link.


Tuesday, February 07, 2006

A Promising New Blog

Economics professor Antonio Saravia from American University of Sharjah, has started a new blog about Bolivia, focusing on the economic policies of the Morales administration. The blog is called Evonomics, Lecciones de Economia en Evoland, and so far has some very interesting posts. We hope to participate in the project and will be commenting on it regularly.


Thursday, February 02, 2006

Floods Affect Soybean / Soymeal Production

While the human cost of the recent floods is growing exponentially, leaving thousands of families without readily available access to food or medicine, the economic costs are starting to be felt as well. Carlos Rojas, president of the Asociacion de Productores de Oleaginosas y Trigo (ANAPO) estimates that the region has suffered the loss of 30,000 hectares of soybean crops, with 70,000 hectares more under risk. Damages are expected in the millions of dollars. The most affected sectors include small cooperative producers.

Though Bolivia accounts for a small proportion of the world's soy bean production, it has sought to equal Paraguay (currently at 2 percent of the world's output) in the near future. In the mean time, South American Soybean and Soymeal futures traded in the CBOT have been moving higher in response to weather shifts in Argentina and Brazil and increasing demands from China.

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