Jump Start

Reports from the World Economic Forum in Davos suggest mission accomplished for Argentine President Mauricio Macri and his delegation.  A little over a month since inauguration, his task naturally was to assure the international community of the new government’s determination to negotiate debts and pursue ample economic cooperation, breaking away from long standing and fierce protectionist policies by his predecessors.

Macri’s Minister of Finance went so far as to name the need to “remind the world of Argentina’s existence” as their main purpose at the event. Meanwhile the President spoke of existing investment opportunities in his country and even recommended the shift of resources originally directed to Brazil – something which may actually occur in the short time and in few specific segments.

Mauricio Macri is a talented politician whose speeches are quite assertive as a rule. Earning back the trust of potential overseas partners is vital at this point where he has enormous challenges ahead of him to fix an economy that was heavily battered in years of populism back home. Macri’s first actions since taking office all point to a radical departure from the State’s reigning stronghold on the economy.

Prospects of recovery in Argentina are just as encouraging to its neighbors. It demonstrates how the anticipation of a turn towards well balanced liberalism may already produce some relief in times of crisis deepened by widespread delusion and pessimism. No one doubts that South America’s flirtation with pseudo welfare regimes is inevitably doomed by virtue of its own catastrophic economic consequences.

There is room for hope that improved governance, accountability and fiscal responsibility may derive from the troubles the continent presently faces. Macri’s election enabled Argentina to leap ahead in the race to make up for past mistakes. Others – Brazil in particular – are very likely to follow suit sooner or later.

From the Tollgate

STP company, owner of the leading non-stop drive through Sem Parar system in São Paulo State highways is rumored to be the subject of an intended take over by U.S.-based Fleetcor in a move that might involve as much as US$ 1 billion.

Sem Parar remains the leader in the segment that has been open to competition since 2013. In 2014 its revenue and amounted to US$ 160 million with net profit of US$ 50 million, considering the presently inflated exchange rate.

Currently STP’s major stockholder is highway concessionary CCR, along with the entrepreneur who originally founded the company in 2000, an investment fund, oil, energy and payment technology-related companies with smaller stakes each. Those involved parties are reported to be undecided about selling their respective stock.

STP has been approached by other prospective buyers throughout its brief existence. Even facing growing competition backed its business appears to be very solid, thus reflecting a crisis-resistant market.

Money Talks

Football has massive publicity anywhere, especially so in Brazil. Interesting though is when it moves from the sports to the economy pages as it is happening as the year begins. The general public will always think of the game as leisure or passion, but no one can deny it is also and mainly business, big business!

The 2015 Brazilian Champion Corinthians Paulista had an outstanding season. At first under financial constraints and losing a number of players seeking higher pays elsewhere, it came to be viewed as the underdog. However as the competition unfolded it managed to make a striking comeback, finishing well ahead of the runner up and clinching the title with three rounds still remaining.

Once praised as Brazil’s strongest contender for this year’s South American Cup, Corinthians found itself under heavy artillery right in the first days of January. Football in China is a novelty, but that does not prevent it from moving huge sums of money. In a little more than a week a handful of key Corinthians players have allegedly been drawn towards the Far East by multimillion dollar contracts.

For such players in evidence, most of whom are the subject of added visibility for being often called to the National Team, the outmost achievement is to be hired by one of the top teams in Europe. Moving to a distant incipient Chinese league instead normally means departing from the spotlight – perhaps for good.

It is true that for those professionals hitting 30 years of age and anticipating decline in their careers, cash will tend to be the predominant factor in their job choices. However in practice the same will also apply to some younger players who could otherwise pursue higher glory, fame and fortune.

What lies behind the exodus of football players is in truth the 40% currency devaluation seen in Brazil in the past twelve months. That political crisis-fueled event ultimately leads to the analogy with the state of affairs in the country’s marketplace. After all it is such abnormal situation that makes players susceptible to the call of the Chinese mermaid, just as products, services, assets remain undervalued, at least for the time being.

Nissan’s new bet on market niche

Japanese automaker Nissan announced a new investment of US$ 188 million from now until 2018 to locally produce the make’s SUV called Nissan Kicks, reports O Estado de S. Paulo newspaper. The new production  line will add 600 posts to the existing 1,500-people worforce at Nissan’s Rio de Janeiro State plant in the city of Resende.

Contrary to the industry’s negative results in 2015 – not yet expected to significantly improve this year – the compact crossover SUV segment has increased 20% in the same period, says Nissan CEO Carlos Ghosn.

Brazil ranks among the five largest motor vehicle markets in the world. More than 20 plants are located in its territory, manufacturing an excess of 70 different models.