LatAm Daily News Roundup: June 10th

Find out what's been happening in Latin America with our latest news update.

Posted Wednesday, June 10th 2020
LatAm Daily News Roundup: June 10th

Argentina may seek to offer warrants linked to agricultural exports to close the gap with some of its creditors in its debt restructuring talks, and which has reportedly gained support from some of the country’s bondholders as Argentina’s export data is seen as more transparent than its GDP figures. Argentina has a June 12th deadline to reach an agreement with its creditors and restart the repayments on its $65 billion sovereign debt, after falling into default on May 22nd. The government has reportedly come to blows with some of its creditors however, and may seek to exclude some from the next round of negotiations, according to local media reports.

Brazil’s government debt is projected to rise to 92.3% of GDP this year, compared with 89.4% previously, according to a new forecast by Fitch Ratings. The agency forecasts economic expansion to resume in 2021, with real GDP growing by 3.2%, and the deficit to narrow to 6.5% of GDP as the fiscal package is unwound. But public debt will continue rising to 93.5% of GDP, compared with a ‘BB’ category median of 56.3%, Fitch said. The agency’s updated Brazilian economic and fiscal forecasts underscore the downside risks, having revised the rating uutlook on Brazil’s ‘BB-’ rating to negative from stable in May. “We still forecast GDP growth and deficit reduction next year, but the uncertain duration and intensity of the coronavirus crisis present risks to these projections,” Fitch said.

Chilean Women’s Minister Macarena Santelices has resigned from her post one month after being sworn into office, following criticism of her aptitude and performance. Santelices, who is a former mayor and also a great niece of former dictator Augusto Pinochet, is a member of the right-wing Independent Democratic Union (UDI) party. She took office amid opposition from Chilean women’s groups in early May and has faced an avalanche of criticism for her actions, as well as for previous statements in interviews in which she defended Pinochet’s 1973-90 rule. The resignation was followed by the appointment to the post of Mónica Zalaquet, a former congress member, but who has been criticized by women’s rights groups for opposing a law allowing abortion in cases of fetal abnormalities.

Health workers in Colombia protested on Tuesday against the government’s failure to make promised investments to confront the impending peak in coronavirus infections. Investment in the sector has totaled $420 million, short of the $3.8 billion promised since the Covid-19 pandemic hit the country, according to media reports. Healthcare in the country’s southeast and along the Pacific coast has all but collapsed, while hospitals along the Caribbean coast are struggling to keep up with rapidly increasing Covid-19 admissions, and the capital Bogotá is reportedly on the brink of declaring an orange alert as it runs out of intensive care units. Cali, the country’s third-largest city, has already declare orange alert. Health Minister Fernando Ruiz had again promised a financial injection into the country’s public hospitals and clinics on Monday.

Mexican President Andrés Manuel López Obrador has called on Canadian mining companies to pay their taxes. The president said on Tuesday that some mining companies are behind on their payments, and urged the Canadian government to lean on them to avoid the dispute reaching international tribunals. In May, Canada’s First Majestic Silver Corp said it had served notice to Mexico’s government under its North American trade treaty obligations to begin talks to resolve taxation disputes. Nearly 70% of foreign-owned mining companies operating in Mexico are based in Canada, and the value of Canadian mining assets in Mexico totaled CAD$18.4 billion ($13.7 billion) in 2017, according to the Mining Association of Canada. López Obrador has pursued several foreign companies in an attempt to make them comply with their tax obligations in Mexico, including Walmart.

Peru will maintain its ban on movement on Sundays, which the government says has played an important role in limiting the contagion of Covid-19. Defense Minister Walter Martos said on Tuesday that the social restriction measure will remain in place because the level of contagion remains high. However, he said a decision on whether to lift the ban on movement could be taken this week. “Sundays are playing an important role because practically the whole country is stalled, and that is avoiding more contagion,” Martos was quoted by local media as saying. He said that some regions of the country, such as Loreto, Lambayeque, Puno and Cajamarca, are seeing a fall in the number of new Covid-19 cases, and the lifting of some restrictions in those regions is being analyzed. Peru’s death toll from Covid-19 currently stands at 5,738, with more than 204,000 confirmed cases.