MARKET RESEARCH REPORT MONITORING INDUSTRY IN LATIN AMERICA 2022

MARKET RESEARCH REPORT

MONITORING INDUSTRY IN LATIN AMERICA

2022

• STATE OF MONITORING TECHNOLOGIES IN LATIN AMERICA 2021-2022 • RANKING TOP 50 MONITORING COMPANIES 2022 • USE OF VIDEO SURVEILLANCE FOR MONITORING IN LATIN AMERICA • GROWTH AND OPPORTUNITIES IN THE MONITORING MARKET • OVERVIEW OF LATIN AMERICAN ECONOMIES (PANDEMIC - POSPANDEMIC)

© Latin Press, Inc., 2022 All rights reserved. No part of this work may be reproduced or incorporated into a computer system or transmitted in any form or by any means (electronic, mechanical, photocopying, recording or otherwise) without the prior written permission of the copyright holders. Infringement of such rights may constitute an intellectual property offense.

Original title: Market study Industry of Monitoring 2022.

1st edition: March 2022 Research and writing: Andrea Ochoa Restrepo Editorial Direction: Duván Chaverra Layout: Jhonnatan Martínez Avalo Graphics: Jhonnatan Martínez Avalo Photos: Pixabay

Table of Contents Monitoring Industry Market Research Report 2022: How it’s done?..................................................... 7 Introduction........................................................................................................................................................8 Chapter 1: Status of monitoring technologies in Latin America, 2021-2022...........................................12 Main segments of monitoring projects in 2021..................................................................................................13 Top monitoring brands most used in Latin America in 2021..............................................................................14 Imports by country of origin ..............................................................................................................................15 Imports by region and companies .....................................................................................................................16

Chapter 2: Company outlook ......................................................................................................... 18 Mexico.................................................................................................................................................................19 Central America and the Caribbean ..................................................................................................................21 Andean Region ...................................................................................................................................................22 Southern Cone ..................................................................................................................................................24 Consultant Perspectives .....................................................................................................................................26

Chapter 3: Ranking Top 50 Monitoring companies 2022............................................................. 32 Mexico.................................................................................................................................................................34 Central America and the Caribbean...................................................................................................................36 Andean Region ...................................................................................................................................................37 Southern Cone....................................................................................................................................................39

Chapter 4: Use of video surveillance for monitoring in Latin America...................................................40 Physical Security Market Forecast 2020 to 2025................................................................................................42 Video surveillance growth opportunities based on supply and demand...........................................................43 Video surveillance implementation by country...................................................................................................44

Chapter 5: Growth and Opportunities in the Fire Monitoring Market ..................................................56 Fire Detection Market Demand..........................................................................................................................58 Growth of remote monitoring in relation to IOT solutions.................................................................................59

Chapter 6: Rising freight and cargo prices: Why? ........................................................................ 62 Chapter 7: Overview of Latin American economies (pandemic-post-pandemic)....................... 66 Financial Markets Volatility Index........................................................................................................................67 Emerging Markets Bond Index 2020..................................................................................................................68 Year-on-year rate of change in world trade volume............................................................................................70 GDP growth in Latin America.............................................................................................................................72 Expenditure growth by component in Latin America ........................................................................................73 Future outlook.....................................................................................................................................................73 Inflation expectations 2020 and 2021.................................................................................................................77 Impact on the level of investment and capital flows in relation to the risk of financial .....................................78 Infographics: Exports and trade balance of Mexico and Central America 2020 ...............................................79 Mexico, Central America and the Caribbean ....................................................................................................80 Infographics: Exports and trade balance South America 2020..........................................................................87 Andean Region ...................................................................................................................................................88 Southern Cone....................................................................................................................................................92 Index of references................................................................................................................................... 96 MONITORING MARKET RESEARCH REPORT

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Monitoring Market Research Report 2022: How is the ranking done?

Ventas de Seguridad presents the Top 50 Ranking of monitoring companies in Latin America, with the purpose of highlighting in 2022 the work of these companies in the region for the growth of the industry.

This ranking was born as an initiative that has also been successfully carried out by other international economic media, which, through information collected, highlight the most important companies in the region or in the countries to which they belong.

In this opportunity we consulted several sectors, including manufacturers, distributors, in addition to the bulk of our readers (consultants, technicians, end users, operators, among others) throughout our Latin American region, who, in the end, were responsible for legitimizing this work and contributing to the recognition of these companies.

Research Metodology A complete compilation of information was made in order to consolidate a list of 50 of the most outstanding companies in Latin America, divided into four subregions (Mexico, Central America and the Caribbean, the Andean Region and the Southern Cone). For this point, the recommendations of the experts were taken into account, who identified the companies with the best positioning within the Monitoring industry, as well as a detailed follow-up by the Ventas de Seguridad journalistic team, supported by expert consultants.

Subsequently, by collecting information through different platforms, the revenues of each of these companies were compiled, which allowed us to place them in the ranking. The list also includes information on the segments served by each of the companies.

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Introduction The world economic outlook continued to weaken during the last two years as a consequence of the Covid-19 pandemic, the trade tensions between the United States and China, the confusing evolution of the European Union affected by Brexit and the slowdown of the German economy, as well as the increase in risk aversion in the financial markets, which is reflected in the low levels of long-term interest rates in the bond market and the inversion of the yield curve.

Thus, investment has been losing dynamism in the world despite liquidity and low interest rates. This is directly related to the current level of uncertainty.

In the face of these variables that have a considerable impact on the global economy, in 2020 the rupture in the agreement to cut OPEC+ crude oil production due to the oil war between Saudi Arabia and Russia was added, which together with the lower world demand due to the Covid-19 implied a plunge for the Brent reference, which between March 6 and 9 of that year was 24%, which led to a certain stillness in the markets. These two shocks have generated fear in the financial markets and led to changes in international capital flows and exchange rate depreciations, especially in emerging economies.

In 2020, the world economy experienced its worst economic contraction since the 1930s, as a result of the measures put in place by governments to deal with the pandemic. According to the United Nations Department of Economic and Social Affairs (UN

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DESA, 2021), the world economy will contract by 4.3% in 2020, 0.9 percentage points less than the forecast of -5.2% published in September 2020, which affected the industry, forcing many companies in the sector to transform their services.

In relation to the current outlook, this industry is also facing major obstacles, mainly due to the economic and social circumstances that several Latin American countries are going through. However, as will be seen in this report, businessmen have been able to sustain and move forward with their businesses, adapting to a new normality and facing the harsh measures imposed by governments to try to contain the pandemic, also facing the volatility of markets, the decrease in demand, the fall in trade, capital flows, economic deficit, financial instability and investment risks due to the current situation.

According to the Economic Balance of Latin America and the Caribbean prepared by the UN Economic Commission for Latin America and the Caribbean (ECLAC): “In terms of economic growth, in the economies of South America, GDP fell in the first three quarters at a rate of -7.7% year-on-year, compared to a growth close to zero in the same period of the previous year.

The economies of Central America went from 3.2% growth in the first three quarters of 2019 to a 5.9% contraction in the same period of 2020. If Central America and Mexico are taken into account the drop in growth in the first three quarters of 2020 is 9.2%,

a figure of 9.6 percentage points, lower than in the same period of 2019.”

According to data provided at the beginning of 2021

by ECLAC, the volume of world trade in goods fell by around 9% in 2020, less than the collapse recorded in 2009 during the global financial crisis (-13%).

Likewise, in the exchange market, the current account deficit caused by the decrease in exports has been

worrying. However, ECLAC expects the region’s current account deficit to decrease significantly (to 0.4% of GDP from 1.8% of GDP in 2019) due to the sharp contraction in imports.

A 14% reduction in volume terms is expected. The value of the region’s exports would contract by 13%.

Export prices are expected to fall by 7% and export volumes by 6%.

Rate of change in world trade volume, 2005-2020 (In percentages) 25 20 January 2005 to june 2007 7,6%

15 10

July 2011 to december 2016 2,0%

January 2017 to december 2018 4,1%

-15

-25

2020

2019 -0,5%

-10

-20

2019

2018

2017

2016

2015

2014

2013

2012

2011

2010

2009

2008

2007

-5

2006

0

2005

5

April to october 2020 -12,7%

April to june 2009 -17,2%

Note: The 2020 figures correspond to the average year-on-year variation for the first 10 months. The red and green horizontal lines correspond to the average annual growth for the period.

Source: Economic Commission for Latin America and the Caribbean (ECLAC), based on figures from the Netherlands Bureau of Economic Policy Analysis (CPB).

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In order to mitigate exchange rate volatility, the region’s central banks have adopted various exchange rate measures, including greater intervention in the markets, through the purchase or sale of foreign currency, but also through regulations to regulate financial flows.

In countries such as Brazil, Chile, Colombia, the Dominican Republic, Guatemala, Jamaica, Mexico, Peru and the Dominican Republic, an increase in the amounts allocated to foreign exchange market interventions has been announced, as well as a broadening of the horizon of such interventions.

ding and liquidity measures for the productive sector, which have influenced the behavior of public accounts during 2020-2021.

The financial instability generated by the pandemic in international markets and the uncertainty about commodity markets led to strong exchange rate corrections and, in the first three quarters of 2020, the region’s currencies experienced considerable fluctuations.

In addition, the authorities have used various instruments to provide foreign currency liquidity, such as forward contracts and swaps, which have had a significant impact on monitoring and security companies.

For ECLAC, “most of the region’s currencies depreciated against the dollar, thus maintaining the trend observed in 2019. Thus, in the first ten months of 2020, 17 of the region’s economies recorded depreciations of their currencies against the dollar rate at the end of 2019, and the average depreciation was 16.3%.”

Similarly, fiscal policy has become the most important tool used by countries in the region to address the social and economic effects of the pandemic.

This has been reflected in tax relief, public spen-

For 2021, forecasts made by ECLAC indicate financial conditions similar to those of the second half of 2020, in which countries have continued, in general, with access to financing on favorable terms.

TARGET AUDIENCE • Businessmen in the monitoring industry.

• Manufacturers and distributors of monitoring equipment.

• Market analysts and researchers.

• Government and financial institutions.

• Investors.

• End users with projects that include monitoring services.

In addition, possible currency depreciations in the face of lower appetite risk will exert pressure especially on those countries with higher levels of foreign currency debt.

It is worth noting that the Market Study Monitoring Industry In Latin America 2022 report analyzes how this economic outlook would impact the industry, country by country, from the perspective of the businessmen that are part of this Top 50 conducted by Ventas de Seguridad.

Additionally, for this 2022, the report addresses chapters such as: “State of monitoring technologies in Latin America 2021-2022”, “Perspectives of the businessmen”, “Ranking Top 50 businessmen 2021”, “Rise in freight and cargo prices, why is it due?”, “Latin American economic outlook (pandemic-post-pandemic”, “Growth and opportunities in the monitoring market”, “Implementation of video surveillance for monitoring cities in Latin America”.

In addition, it addresses key industry information, such as import figures made by companies in each country, the most used equipment brands in the region, the segments with the highest investment in monitoring, including sales figures of several of the companies along with detailed contact data.

We will then delve into the business situation and large-scale responses, the productive structure (external and internal productivity gaps in the region) and the differences in performance between the different segments. In addition, the prospects and level of investment for the sector are analyzed, country by country.

Readers will also get a complete overview of the monitoring companies in Latin America, as well as comments and recommendations on technology trends and investment opportunities.

Other key aspects of the industry are also developed, based on the growth of the market during the last year, originating from the acquisition of electronic monitoring systems.

MAIN SEGMENTS OF MONITORING PROJECTS 2021

11,5% 34,6% 26,9%

26,9%

RESIDENTIAL CORPORATE COMMERCIAL EDUCATION AND GOVERNMENT

Source: Survey conducted on an online platform among the businessmens of the Monitoring Industry in Latin America between December 2021 and January 27, 2022.

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CHAPTER 1

MAIN SEGMENTS OF MONITORING PROJECTS 2021 The residential, corporate and commercial segments had a significant increase in market share during 2021 considering all of Latin America. Despite the impact caused by the pandemic, several projects were able to develop in different segments. This can be reflected by the implementation of equipment, artificial intelligence, among others, necessary in the field of cybersecurity and teleworking.

It is notorious that most of the businessmen serve most of the segments. However, in regions such as Mexico and the Southern Cone, it is notorious the increase of attention in the residential sectors compared to the Andean region.

In turn, the Andean region has a greater presence in the corporate sector, this may be due to the implementation of video surveillance monitoring and other sectors that still prevail with teleworking. In the case of Cono Sur it is evident that the commercial sector is much stronger in the implementation of monitoring projects, which is above Mexico and the Andean region in percentage terms.

In conclusion, there are greater opportunities in all segments since the vast majority of businessmen actively participate in all of them.

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MAIN SEGMENTS OF MONITORING PROJECTS 2021 MEXICO, CENTRAL AMERICA AND THE CARIBBEAN

ANDEAN REGION

9.1%

14.3%

14.3%

36.4%

42.8%

27.3%

29.0%

27.3%

RESIDENTIAL CORPORATE COMMERCIAL EDUCATION AND GOVERNMENT

SOUTHERN CONE

Survey conducted on an online platform among the businessmens of the Monitoring Industry in Latin America between December 2021 and January 27, 2022.

RESIDENTIAL CORPORATE COMMERCIAL EDUCATION AND GOVERNMENT

ALL LATIN AMERICA

12.5%

11.5%

12.5%

34.6% 37.5%

37.5%

RESIDENTIAL CORPORATE COMMERCIAL EDUCATION AND GOVERNMENT

26.9%

26.9%

RESIDENTIAL CORPORATE COMMERCIAL EDUCATION AND GOVERNMENT

MONITORING MARKET RESEARCH REPORT

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TOP MOST USED MONITORING BRANDS IN LATIN AMERICA IN 2021

11.0%

ALARM PANELS

11.0% 44.0%

TYCO HONEYWELL BOSCH EBS, DMP, JFL, PARADOX

33.0%

MOTION SENSORS TYCO HONEYWELL BOSCH EBS DMP JFL 2GIG

17.0%

ALARM MONITORING SOFTWARE SOFTGUARD TECHNOLOGIES KRONOS

83.0%

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3.0% 5.0% 6.0% 8.0% 44.0% 11.0%

22.0%

ORIGIN OF IMPORTS OF MONITORING EQUIPMENT IN 2021

9.5%

MEXICO CENTRAL AMERICA AND THE CARIBBEAN

9.5%

28.6%

14.3%

UNITED STATES CHINA MEXICO PANAMA HONG KONG GERMANY

23.8%

14.3%

ANDEAN REGION CHINA UNITED STATES JAPAN BRAZIL KOREA MEXICO TAIWAN

SOUTHERN CONE USA CHINA MEXICO BRAZIL TAIWAN VIETNAM BELGIUM ROMANIA THAILAND CANADA

6.3% 6.3%

6.3%

6.3%

6.3%

25.0%

12.5%

18.8%

25.0%

18.8%

6.3% 6.3% 18.8%

6.3%

*Source: Descartes Datamyne and ICT, with official information.

6.3% 12.5%

12.5%

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IMPORTS OF COMPANIES IN ALARM EQUIPMENT, FIRE DETECTION AND VIDEO SURVEILLANCE CENTRAL AMERICA 2021 COUNTRY

DATES

COMPANIES

MAIN ORIGINS

VALUE IN USD

Panama

Jan-Dec 2021

MDM Securities, Inc.

Colon Zone, Hong Kong, China,

$336.003

CIF

Korea, United States.

IMPORTS OF COMPANIES IN ALARM EQUIPMENT, FIRE DETECTION AND VIDEO SURVEILLANCE – ANDEAN REGION COUNTRY

DATES

COMPANIES

MAIN ORIGINS

VALUE IN USD

Colombia

Jan-Dec 2021

Prosegur GPS de Colombia

France, China Taiwan, Singapore, Mexico, Spain

$1.071.049.25

FOB

Colombia

Jan-Dec 2024

Alarmar

Mexico, Japan, Monaco, Argentina, Ukraine, United Kingdom, France, China, Netherlands

$286.648.30

FOB

Colombia

Jan-Dec 2022

G4S

Mexico, USA, Taiwan, China Canada, Vietnam, Thailand

$207.294.69

FOB

Colombia

Jan-Dec 2025

Multialarmas

China

$131.375.20

FOB

Colombia

Jan-Dec 2023

Telesentinel

Israel

$38.749.63

FOB

IMPORTS OF COMPANIES IN ALARM EQUIPMENT, FIRE DETECTION AND VIDEO SURVEILLANCE 2021 – CONO SUR COUNTRY

DATES

COMPANIES

MAIN ORIGINS

VALUE IN USD

Chile

Jan-Dec 2021

Verisure – Patroll

Israel, Spain, Vietnam

$9.607.306.55

CIF

ADT Security

Mexico, China, Canada,

$2.270.560.75

CIF

Services

Singapore

FOB (Free on Board) CIF (Cost, Insurance and Freight) *Source: Descartes Datamyne with official information

In this regard, it is important to highlight that, although some of these companies import equipment as distributors, many others choose to only import certain equipment and components for their projects, and the rest of the elements are acquired through local distributors.

reign trade has presented strong import and export shocks, which is proportionally related to the drop in imports in monitoring systems. However, with the reactivation of capital flows, supply and demand may increase, which would allow import growth for companies.

It should also be taken into account that from 2020 to date, Latin American countries have been impacted by COVID-19, which can significantly affect the production of projects, thus improving the acquisition of equipment, while the uncertainties of the markets work. At the same time, fo-

Note: For these tables, only data on imports of monitoring equipment, such as video surveillance cameras, alarm equipment and fire detection, were taken into account. The complete list of tariff codes analyzed for this chapter can be consulted in the Reference Index on page 96.

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CHAPTER 2

OUTLOOK OF LATIN AMERICAN COMPANIES The various representatives of the Top 50 companies in the Security Monitoring industry shared with us their perceptions of the projects and market trends they developed in the region, as well as their forecasts for the future, mainly considering the repercussions of the COVID-19 pandemic. In addition, they shared the results obtained (such as the value of sales per project completed) in 2021 and their growth and sales expectations for 2022.

Also, industry businessmen and experts were consulted about the perception of this business in recent years and the aspects that all players should strengthen to drive growth and economic recovery after the arrival of the pandemic.

They focused not only on the technological issue but also on the growth of the industry in three scenarios: international trade, reduction of rents due to the pandemic and in a third scenario: capital flows in relation to the risk that financial markets have within the industry.

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Mexico

Sintel Security

Karim Povedano Commercial Director • In which cities and/or countries do you have the greatest participation?

Mexico • What is your analysis of the Alarm Monitoring market in Latin America and, especially, in the country where your company does business (sales, consumption, knowledge)?

Sales in freight transportation monitoring.

• What are your company’s goals and/or projects for 2022?

Growth in people monitoring.

Dispositivos Electrónicos de Protección, SA de CV LEDU Enrique Lemus General Manager

• In which cities and/or countries do you have greater participation?

Aguascalientes, Mexico.

• Share with us an approximate sales figure for 2020 -2021 USD $ 38,000,000 • What were the most outstanding projects and/or clients added by your company in 2020 and 2021?

Automotive industry and residential subdivisions under development.

• What is your analysis of the Alarm Monitoring market in Latin America and especially in the country where your company does business (sales, consumption, knowledge)?

Sales in amount are increasing, users are at best maintained and customer awareness is growing.

• What are your company’s goals and/or projects for 2022?

To increase the number of users by 10% and introduce one or two new services to the market.

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THE PERSPECTIVES OF BUSINESSMEN

Blue Guard SA de CV Eduardo Morales Director

Alarmas Protektor Sa de Cv

• In which cities and/or countries do you have the greatest participation?

Throughout the Mexican Republic.

Felipe Torrentera Samano Head of Infrastructure and Monitoring

• Share with us an approximate sales figure for 2020 and 2021 USD $50,000,000

• In which cities and/or countries do you have greater participation?

Queretaro Bajio.

• What were the most important projects and/or clients added by your company in 2020 and 2021?

We added a couple of significant clients in the retail sector.

• What is your analysis of the Alarm Monitoring market in Latin America and, especially, in the country where your company has business (sales, consumption, knowledge)?

Customer service and continuous training.

• What is your analysis of the Alarm Monitoring market in Latin America and especially in the country where your company does business (sales, consumption, knowledge)?

The market is in transition of technology towards IP, as well as incorporating more and more strongly the alarm signals through video surveillance systems and convergence with IOT. The challenge for Latin American companies is to adapt to these new technologies.

• What are your company’s goals and/or projects for 2022?

Consolidate our growth in CCTV and expand our corporate customer base.

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• What are your company’s purposes and/or projects?

Implementations of Monitoring Software for customer service and attention with greater Efficiency.

Central America and the Caribbean

G4S

Armando Gonzalez General Manager Guatemala • In which cities and/or countries do you have the greatest participation?

Guatemala, Quetzaltenango, Antigua, Escuintla, Chimaltenango, Coatepeque, Mazatenango.

• What is your analysis of the Alarm Monitoring market in Latin America and, in particular, in the country where your company does business (sales, consumption, knowledge)?

There is a growing demand and many opportunities in the security business in general. The area of the greatest growth opportunity is residential, as it is an underserved market. The trend that G4S is setting is the incorporation of home automation and lifestyle, with video and access integration.

• What are your company’s goals and/or projects?

Growth of the market share of monitoring and engineering projects of at least 15%.

Alarma 24 / Grupo Insted Jose Reyes CIO Panama

• In which cities and/or countries do you have greater participation?

Panama, David Chiriqui, Colon, Chitre Herrera, The company has a presence throughout the country.

• What is your analysis of the Alarm Monitoring market in Latin America and especially in the country where your company has business (sales, consumption, knowledge)?

There is a lack of professionalism in the industry, we are plagued by bad practices especially in intrusion systems, in CCTV it is happening that companies from other sectors such as IT and communications are participating.

• What are the purposes and/or projects of your company?

We are looking to open branches outside Panama, the first country where we have made progress in documentation is Colombia.

We want to establish a strategy to improve professionalism internally.

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THE PERSPECTIVES OF BUSINESSMEN

Andean Region

Security Shops

Alarmas y Monitoreo

• In which cities and/or countries do you have greater participation?

National coverage (Colombia).

• In which cities and/or countries do you have greater participation?

Ecuador at a national level.

• Share with us an approximate figure of sales in 20202021 $500,000,000 (Colombian pesos).

• What were the most important projects and/or clients added by your company in 2020- 2021?

Financial and corporate institutions.

• Which were the most outstanding projects and/or clients added by your company in 2020 and 2021?

Lili Pink.

• What is your analysis of the Alarm Monitoring market in Latin America and, especially, in the country where your company has business (sales, consumption, knowledge)?

Brand representation, training, technical support of the Dahua brand.

Representation, technical support and training of the DSC brand.

Anny Martinez General Manager Colombia

• What is your analysis of the Alarm Monitoring market in Latin America and especially in the country where your company has business (sales, consumption, knowledge)?

The alarm monitoring centers will adapt to a technological change where the main objective will be to add another type of service or technology, analytical CCTV, remote access controls among others, this in order to evolve the way in which conventional alarm monitoring was done, with clear makes us think that we all must make changes, adjustments and improvements in the way we do monitoring, thinking about costs, benefits and new rules.

• What are your company’s goals and/or projects for 2022?

Implement new CCTV technologies for greater efficiency in detecting events and hazards.

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Luis Carlos Padilla Andrade General Manager Ecuador

• What are your company’s purposes and/or projects for 2022?

Increase services in the area of CCTV and community and intrusion alarms to massif the monitoring product.

Protel Srl

Pablo Camacho General Manager Bolivia • In which cities and/or countries do you have greater participation?

In La Paz, El Alto, Sucre and Tarija we are market leaders, we have the largest number of response vehicles.

• Share with us an approximate figure of sales in 20202021 USD $3,000,000.

• What were the most important projects and/or clients added by your company in 2020 and 2021?

Bolsa Boliviana de Valores, Entidad de Depósito de Valores and Industrias Copacabana, all these projects were developed under the premise of integration of security systems with the cybersecurity component.

• What are your company’s goals and/or projects for 2022?

We are working on training the financial system, mining and oil sector on the importance of developing their security projects with integration and cybersecurity concepts.

We are the first company to open a branch in the city of El Alto with the best interactive showroom, which in the opinion of our suppliers (DSC, Rosslare, Etx) is the best in Bolivia and among the 3 best in Latin America.

• What is your analysis of the Alarm Monitoring market in Latin America and, especially, in the country where your company has business (sales, consumption, knowledge)?

The Bolivian customer is demanding quality products, with international certification and with the use of applications, the economic crisis is demanding the use of electronic security systems (Alarms, CCTV, access control, fire systems, etc.).

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THE PERSPECTIVES OF BUSINESSMEN

Southern Cone Laarcom Cia

Alert

• In which cities and/or countries do you have greater participation?

Quito concentrates 55 %, Guayaquil 40 %, 5 % are distributed in the main cities of Ecuador.

• In which cities and/or countries do you have greater participation?

In the southern area of Greater Buenos Aires.

Luis Rojas V. General Manager Ecuador

• Share with us an approximate sales figure for 20202021 USD $6,000,000 • What were the most important projects and/or clients added by your company in 2020 and 2021?

TIA, Etafashion, La Ganga.

• What is your analysis of the Alarm Monitoring market in Latin America and especially in the country where your company has business (sales, consumption, knowledge)?

Industry sales, income tax payment of competing companies, horizontal analysis of comparative sales of the previous 5 years, Churn Rate analysis.

• What are your company’s purposes and/or projects for 2022?

Expansion of products and services to people and new end user solutions.

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Pablo Lanfredi Manager Argentina

• What is your analysis of the Alarm Monitoring market in Latin America and, especially, in the country where your company has business (sales, consumption, knowledge)?

That the client not only demands security through monitoring but also wants to control his equipment remotely and corroborate the alarm signals reported by the operator with his cameras.

• What are the purposes and/or projects of your company?

Maintain a satisfied customer and add new customers with a renewed technology in alarm monitoring.

Albeiro Hnos. SRL

First Security

• In which cities and/or countries do you have greater participation?

Argentina.

• In which cities and/or countries do you have the largest share?

Chile

• What is your analysis of the Alarm Monitoring market in Latin America and, especially, in the country where your company has business (sales, consumption, knowledge)?

Few possibilities of growth as a consequence of the economic crisis in Argentina.

• Share with us an approximate figure of sales in 20202021 USD $26,000,000.

Oscar Albiero Managing Partner Argentina

• What are your company’s purposes and/or projects?

Maintain turnover.

Geza Fried Grbic Chief Executive Officer Chile

• Which were the most outstanding projects and/or clients added by your company in 2020 AND 2021?

Coca Cola, Breden Master, CMPC, Bresler, British American Tobacco, Oxiquim, Virginia.

• What is your analysis of the Alarm Monitoring market in Latin America and, in particular, in the country where your company does business (sales, consumption, knowledge)?

Market research, reports from chambers of commerce, Carabineros de Chile, represent open and closed sources of information that allow us to map the development of the Chilean industry and thus determine strategies.

• What are your company’s goals and/or projects for 2022?

To strengthen our commercial area in order to develop an aggressive sales strategy with a differentiating model and comprehensive services.

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EXPERTS / CONSULTANTS OUTLOOK 2022

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“IT IS NECESSARY TO IMPLEMENT KNOWLEDGE OF SECURITY WITH PREPARATION, TO HAVE CERTIFICATIONS AND MAKE FIELD WORK TO DELIVER A GOOD PRODUCT THAT ALLOWS MINIMIZING THE RISKS FOR THE CUSTOMERS”.

Héctor Romero

General Manager Safeway Corporation • WHAT IS YOUR PERCEPTION OF THE MONI-

TORING INDUSTRY AT THE PRESENT TIME? The pandemic has hit everyone, unfortunately, we had problems. There is no investment of money to buy computers for teleworkers. We started to develop software to ensure that employees were monitored. Virtual monitoring was also included: within the facilities, from home. At the moment there are barriers because the protocols are manual, the human resources are committed and trained in cybersecurity.

Looking to 2022 the logistics chain becomes a key point, investing in custody, intelligence centers,

integrators, merchandise, customs agents, traffic, and we must have monitoring control over the origin and destination, measures that must be taken.

Additionally, there is a modification in the technological part and procedures to provide business continuity to companies. Modification that is evident in the type of merchandise, routes to follow, supply chain where they intervene. Responsibility of the monitoring intelligence center. To follow up the conditions, the projective part, according to what are the possible threats, determine the risks and mitigate them.

• HOW DO YOU ANALYZE THE SECTOR OF

COMPANIES? They should not only think about the technology, before selling they should identify the environment with risk analysis, and be accompanied by security agents. Those who market it must know what I am going to protect, and what I am going to protect it from beyond geolocation or dereferencing.

This gives us greater alternatives. This allows the integration of verticals, including telemetry. Security and logistics will allow the efficiency of the intelligence MONITORING MARKET RESEARCH REPORT

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EXPERTS / CONSULTANTS centers, it is not only about tracking. As long as there is no empathy with the customer, in the supply chain, in a timely manner, it is going to be complicated.

Availability of services and products.

Mexico and Brazil. Countries concerned about resources: El Salvador, Guatemala, Nicaragua, Venezuela. In Argentina there are very good integrators, but the political part is hitting them considerably.

• HOW WOULD YOU DESCRIBE THE EVOLU-

TION OF THE INDUSTRY, LOOKING BACK OVER THE LAST 3 YEARS? The evolution is happening thanks to the incorporation of new technology. In addition to the independence of decision-making, since it is not subject to human resources. Therefore, the needs of distributors must be taken into account.

Likewise, technology has become a facilitator of processes, as well as the development of platforms and training for monitors with official norms and standardization framed in the 28,000 standard (supply chain). This gives way, then, to chain security.

In addition, progress has been made in the development of software and hardware, the mitigation of homicides, robberies, extortion and crime rates.

In Colombia, it is worth noting that they are good developers, they manage risk analysis and business alternatives.

• WHAT GLOBAL TRENDS ARE BEING KEY IN THE

INDUSTRY IN RELATION TO CONNECTIVITY? The approach of specialists, protocol management, and clouds. The monitoring of software to combat crime in relation to user behavior in social networks, extortion structures on the government and corporate side.

Also, the use and implementation of solid platforms, not pirated programs, password processes of workers, culture to educate the user and provide security.

• AND IN GENERAL, WHAT MESSAGE OR ADVI-

• DO YOU CONSIDER THAT CUSTOMERS AND

USERS OF SECURITY MONITORING ARE INCREASINGLY BETTER INFORMED AND MORE AWARE OF NEW TECHNOLOGIES IN THE MARKET? HOW CAN THIS AFFECT BUSINESSMEN? They don’t know about telemetry or about the security part to be able to integrate the industry.

They are not familiar with supply chain processes.

These are important parts to determine the parameters in maintenance.

The responsibility lies with the integrator and the logisticians. There should be an approach for the areas and thus generate opportunities to mitigate the theft of goods. Currently, there is a lack of operators due to the threat of crime.

• IN YOUR OPINION, IN WHICH LATIN AMERI-

CAN COUNTRIES IS THE MONITORING INDUSTRY HAVING A GOOD MOMENT? IN WHICH ONES IS IT STAGNATING? Colombia is on the right track, as are Panama,

28

CE WOULD YOU LIKE TO GIVE TO THE MONITORING COMPANIES FOR 2022?

Knowing the business better, we can have better information about the end customer, about the people who will use our service, in order to know what we protect. Perform risk analysis for threats and opportunities.

Additionally, it is necessary to know the security with preparation, to have certification and to do field work to deliver a good product that allows us to mitigate the client’s risks.

Cost - benefit: return on investment, the end user sees the expense and not the investment. The client must be made to understand that he/she will benefit and this will generate savings. It is necessary to work on the reputation of the brand.

If the consumer does not have a product, he will look for other alternatives.

What is gained? Identify users, processes and hidden costs.

“BUSINESSMEN MUST HAVE MAJOR ATTENTION, UNDERSTAND WHAT DIFFERENTIATES A COMPANY FROM THE OTHER. WE HAVE TO CONSIDER THE POSSIBILITY OF REACTION, THE AVAILABILITY OF SYSTEMS”.

Ricardo Guzmán General Manager WeMonitor

• WHAT IS YOUR PERCEPTION OF THE MONITORING INDUSTRY AT THE PRESENT TIME? It has not been affected mainly by the issue of insecurity, because there is greater unemployment and this then allows greater implementation of monitoring systems. Regarding the COVID issue, in the case of companies, it could be said that many of them are small, therefore, they do not have many precautions, since the number of employees is small.

From another point, all industries have changed, there are new technologies to monitor, which are focused on alarm monitoring, access control and

video surveillance, GPS and industrial monitoring.

Also, the type of sensors in the residential sector is currently looking for more services.

As for the corporate sector, there are weaknesses such as: air quality monitoring and infrastructure, shortcomings that are evident because the operators are at home, then the processes are more complicated because it is being monitored from remote work, from a local point. This is a barrier.

In addition, the market is virgin, there is hardly any development.

• HOW DO YOU ANALYZE THE SECTOR OF INTEGRATOR COMPANIES? The analysis takes place in two scenarios: The infrastructure and the robustness of the companies and their systems.

The general processes: user service, maintenance and prevention.

In the face of these, it is necessary to encourage MONITORING MARKET RESEARCH REPORT

29

EXPERTS / CONSULTANTS greater attention, to understand what differentiates one company from another, to take into account the possibility of reaction, the availability of the systems. In addition to having greater availability, which implies having more system time.

They have to bet on the users, to be more present. Previously, the monitors were there when there was an emergency and when they had to get paid, and not when they had to reach the end user. An approach is necessary, otherwise they are going to do without the services. The issue of value to the services offered by the companies.

Being in the customer’s front and back pocket since you are on the cell phone is because you are present.

• HOW WOULD YOU DESCRIBE THE EVOLUTION OF THE INDUSTRY, LOOKING BACK OVER THE LAST 3 YEARS? The clearest trend is to be with the customer, to make the customer the IP side. As for the alarm the analog theme must migrate to go to connectivity and communication of the panels, this certainly has to move forward.

In the countries there are analog blackouts, there is little access to technology and renovation, and this makes obsolete products prevail. And this is costly. This is susceptible to prices because users do not see the value. Having an analog system does not guarantee that the products arrive, and there are changes in the media, and they arrive at the head office in different ways. So they do not arrive, or they arrive incomplete, and there is a lack of understanding on the part of the control centers.

80% of them handle analog alarms. If everything is over fiber, the alarms will no longer be able to be synchronized with the analog equipment. There is a risk to sales and accounts as a result of a blackout. So we need more investment in IP, more communicators with greater functionality and interactivity, but we are still lagging behind!

30

• DO YOU CONSIDER THAT SECURITY MONITORING CUSTOMERS AND USERS ARE BECOMING MORE AND MORE INFORMED AND KNOWLEDGEABLE ABOUT NEW TECHNOLOGIES IN THE MARKET? HOW CAN THIS AFFECT BUSINESSMEN? They are always aware and are consumers of information and trends. The problem is that they are not willing to pay more for it. We do not give value to self-monitoring, and we do not know how to sell the product, and this directly impacts the companies and makes them replace us with other products.

Another point to highlight is that although the user likes technology, in the case of the alarm it is not really an aspirational product, they try to invest as little as possible, therefore they are not willing to pay more for other technology to protect them.

Our culture is not made to prevent but to react in terms of security, it does not come out of savings or financial planning that goes through the insecurity of the countries and ends up coming out of the cash flow that we have for other things.

• IN YOUR OPINION, IN WHICH LATIN AMERICAN COUNTRIES IS THE MONITORING INDUSTRY HAVING A GOOD MOMENT? IN WHICH ONES IS IT STAGNATING? Argentina has internal development and production in terms of security, and Brazil produces most of the things it requires. It has more software infrastructure.

Countries like Mexico have the money and sell to a larger market size. This however does not mean that the country is not willing to adopt the technology.

The countries that lag behind are the smaller countries because they do not have large markets, nor large products, the economy of a country like Costa Rica is not as demanding, and therefore the supply is smaller.

• WHAT DO YOU THINK BUSINESSMEN NEED TO CONTINUE PROMOTING THIS INDUSTRY? First, they lack organization and protection in terms of market regulation. Because it affects prices and supply-demand. The issue of the fight against informality. Thinking about the common good. There is no investment in sales strategies.

There is no awareness with customers and in the markets to generate a preventive culture.

• AND IN GENERAL, WHAT MESSAGE OR ADVICE WOULD YOU LIKE TO GIVE TO MONITORING INTEGRATORS FOR 2022?

They should be focused on new technologies, technology is worth everyone’s life and is an enabler and allows us to have prosperous and profitable businesses. Therefore, we must invest in AI, it is the medium-term future to generate more complete and good services for customers.

• WHAT GLOBAL TRENDS ARE BEING KEY IN THE INDUSTRY IN RELATION TO CONNECTIVITY? IOT, protection of people rather than goods, interactivity.

MONITORING MARKET RESEARCH REPORT

31

32

CHAPTER 3

MONITORING INDUSTRY 2022

RANKING BY REGION

Mexico N°

Company

1

ADT PRIVATE SECURITY SERVICES DE MÉXICO, S.A. DE C.V

2

GRUPO SECURITAS MÉXICO, S.A DE C.V

3

BLUE GUARD

4

DISPOSITIVOS ELECTRÓNICOS DE PROTECCIÓN, S.A DE C.V (LEDU)

Segments served

Contact

Income USD

Year / income

CCTV, alarms

Victor Delgadillo 52 555 4888000 victor.delgadillo.nieto@adt.mx www.adt.com.mx

$82.010.000 (*D)

Modeling

Alarms, GPS, perimeter

Mauricio Miranda 52 552 6363700 mauricio.miranda@securitas.com.mx https://www.securitas.com.mx/

$ 52.980.000 (*D)

Modeling

CCTV, alarms, fire detection

Eduardo Morales 52 811 5386078 eduardo.morales@blueguard.com.mx www.blueguard.mx

$50.000.000 (*E)

2021

GPS, alarms, fire detection

Enrique Lemus 52 449 910 9930 ext 123 direccion@depsaledu.mx www.ledu.mx

$38.000.000 (*E)

2021

CCTV, sensors

Eduardo Allegre 52 871 1892368 eallegre@metricamovil.com www.metricamovil.com.mx

$11.080.000 (*D)

Modeling

$7.360.000 (*D)

2020

5

MÉTRICA MÓVIL, S.A. DE C.V

6

PROSEGUR TECNOLOGÍA, S.A. DE C.V.

CCTV, alarms, fire detection

Marcos Castillo Améndola 52 55 8628 3020 marcos.castillo@prosegur.com www.grupoprosegur.com.mx

7

SYSTEM SAFETY DE MÉXICO, S.A. DE C.V

CCTV, alarms, fire detection

Roberto Moyers 55 537 1 2400 contacto@ssmalarmas.com www.ssmalarmas.com

$4.660.000 (*D)

2020

8

CENTRAL DE ALARMAS DE MÉXICO

Alarms, IP, GSM

Miguel Bárcenas 52 55 5134 0800 mbarcenas@centraldealarmas.com.mx www.centraldealarmas.website

$3.070.000 (*L)

Modeling

34

Mexico N°

9

Company

SECURE WITNESS DE MÉXICO, S.R.L DE C.V.

Segments served

Contact

Income USD

Year / income

GPS

Gerardo Macay 52 55 6285 9990 ventas@securewitness.com www.securewitness.com

$1.060.000 (*D)

Modeling

GPS

Roberto Zabalza Gracia 52 55 5615 5600 contacto@smarttracker.com.mx www.smarttracker.com.mx

$1.010.0000 (*D)

Modeling

GPS

Miguel Angel Lomas Ruiz 52 442 277 4140 mlomas@tecnologistik.com www.tecnologistik.com

$1.000.000 (*E)

2021

$845.082 (*L)

Modeling

10

SMART TRACKER, S.A DE C.V

11

TECNOLOGISTIK SATELITAL SYSTEMS, S.A. DE C.V.

12

ALARMAS PROTEKTOR, S.A DE C.V

CCTV, alarms, fire detection

Felipe Torrenta 52 442 2186753 administración@alarmasprotektor.com www.alarmasprotektor.com

13

SERVICIOS INTERESTATALES DE CUSTODIA, S.A. DE C.V

Alarms, fire detection

Héctor Manuel Romero Sánchez 52 55 6631 6397 flomas@tecnologistik.com www.tlrlogistica.mx

$541.600 (*D)

Modeling

14

G4S

CCTV, fire detection

Natalia Mahecha 52 55 53370400 informacion@mx.g4s.com www.g4s.com

$ 623.420 (*D)

Modeling

15

SKYGUARDIAN TECHNOLOGY, S.A. DE C.V

CCTV, GPS

Alberto Valencia 52 333 4449284 mkt@skyguardian.mx www.skyguardian.mx

$ 622.320 (*D)

Modeling

Source: (*D) Dun & Bradstreet Data Cloud, official figures based on financial reports originating from some operating companies. Data consulted until February 24, 2022. (* E) Interviews with companies carried out through EncuestaDatos. (*L) Latin Press, INC. * Note: The sources correspond to the data of annual income and year of income. The modeled figures correspond to estimates and projections made on the last year in which the they had data. The year (income) shown in the table is based on the latest information available.

The numbers of the positions that present ** indicate that the companies were located based on the years of experience in the market, this is done because the data corresponding to the income obtained through the platform represent the same value.

MONITORING MARKET RESEARCH REPORT

35

Central America N°

Company

Segments served

Income USD

Year / income

Luis Pablo López Garcia 502 242 92200 info@gruposis.com www.gruposis.com

$11.290.000 (*D)

Modeling

Roberto Gamero 503 250 06285 roberto.gamero@sv.g4s.com www.g4s.com

$7.540.000 / $1.260.000 / $1.090.000 (*D)

Modeling

Panama

Marcos Angel 507 264 8820 marcos@mdm.com.pa www.mdm.com.pa

$5.910.000 (*D)

Modeling

Panama

Ruben Dario Vega La Casa 50 7 236 7117 gerencia@metrosistemas.net ventas@metrosistemas.net www.metrosistemas.net

$1.980.000 (*D)

Modeling

Country

Contact

GRUPO SIS, S.A

CCTV, alarms, GPS

G4S

CCTV, fire detection

MDM SECURITIES, INC.

CCTV, alarms, fire detection

METRO SISTEMAS, S.A

CCTV, GPS, alarms, fire detection

5 **

CENTRAL DE MONITOREO DIGITAL, S.R.L

CCTV, alarms, fire detection

Dominican Republic

Sindy Moquete Placencia 1 809 476 9999 info@cmdsa.com www.cmdsa.com

$1.890.000 (*D)

Modeling

6**

SERVICIOS BÁSICOS DE SEGURIDAD, ER S.R.L

Alarms, video verification

Dominican Republic

Eduardo Reyes Collado 1 809 548 6060 ereyes@sbs.com.do www.sbs.com.do

$1.890.000 (*D)

Modeling

7 **

SEGUSYSTEM, S.R.L

CCTV, alarms, fire detection

Dominican Republic

Jose Pichardo 1 809 566 2244 josep@segusystem.com www.segusystem.com

$1.890.000 (*D)

Modeling

8**

COMUNICACIONES & ALARMA, 365 S.R.L

CCTV, alarms, GPS

Dominican Republic

Omar Bautista 1 809 435 0911 ventas@alarma365.com www.alarma365rd.com

$1.890.000 (*D)

Modeling

9

COMERCIALIZADORA SESCOM, S.A

CCTV, alarms, GPS

Guatemala

Grayson Wright 502 2 429 2400 grayson@sescom.com.gt www.sescom.com.gt

$1.490.000 (*D)

Modeling

COMPAÑÍA DOMINICANA DE ALARMAS, S.R. L

Alarms, fire detection

Dominican Republic

Moisés Yi 1 809 449 5287 moises.yi@codealarma.com www.codealarma.com

$1.350.000 (*D)

Modeling

1

2

3

4

10

Guatemala

Honduras / El Salvador / Nicaragua

Source: (*D) Dun & Bradstreet Data Cloud, official figures based on financial reports originating from some operating companies. Data consulted until February 24, 2022. (* E) Interviews with companies carried out through EncuestaDatos. (*L) Latin Press, INC. * Note: The sources correspond to the data of annual income and year of income. The modeled figures correspond to estimates and projections made on the last year in which the they had data. The year (income) shown in the table is based on the latest information available.

The numbers of the positions that present ** indicate that the companies were located based on the years of experience in the market, this is done because the data corresponding to the income obtained through the platform represent the same value.

36

Andean Region N°

1

2

3

Company

Segments served

G4S

CCTV, fire detection

SECURITAS COLOMBIA

Alarms, GPS, perimeter

MIRO SEGURIDAD, L.T.D.A

CCTV, alarms, GPS

Country

Contact

Income USD

Year / income

Colombia/ Peru

Diana Barrera 57 6919191 57 321 486 4192 comercial@co.g4s.com diana.barrera@co.g4s.com www.co.g4s.com

$74.720.000 / $74.650.000 (*D)

2020

Colombia

Julio César Belalcázar 57 1 217 0081 julio.belalcazar@gmail.com www.securitas.com.co

$ 58.720.000 (*D)

2020

Colombia

Jorge Botero Mesa 57 4 448 1190 jorge.botero@miroseguridad.com www.miroseguridad.com

$50.430.000 (*D)

2020

$ 11.320.000 (*D)

2020

4

CELAR, L.T.D.A

Alarms

Colombia

Marcelo Neira Estrada 57 606)894 4158 celar@celar.com.co www.celar.com.co

5

TELESENTINEL, L.T.D.A

CCTV, alarms

Colombia

Jean Paul Criollo 57 310 206 5656 jeanpaulcpadilla@hotmail.com www.telesentinel.com

$8.170.000 (*D)

2020

Ecuador

Luis Rojas V 593 2 393 2850 lrojas@grupolaar.com www.laarcom.com

$6.000.000 (*E)

2021

$5.420.000 (*L)/ $4.460.000 (*D)

Modeling

$4.420.000 (*D)

2020

6

7

8

LAARCOM, CIA L.T.D.A.

PROSEGUR

ALARMAR, L.T.D.A

Alarms

CCTV, alarms

CCTV, alarms

Gian Franco Maza, 51 1 421 2911 Peru/Colombia gianfranco.maza@prosegur.com www.prosegur.com.co

Colombia

Luis Hernando Gomez 57 4 444 7555 directorproyectos@alarmar.com.co www.alarmar.com.co

MONITORING MARKET RESEARCH REPORT

37

Andean Region N°

9

10

11

Company

Segments served

MARNELL SECURITY, L.T.D.A

Alarms

PROTEL,S.R.L

Alarms, fire detection

SEGURIDAD IMPERIO, L.T.D.A

CCTV, alarms

12

SEGURTRONIC, L.T.D.A

13

SISTEMAS ELECTRÓNICOS INTEGRADOS ANPRISEGSYSTEM, Alarms CIA. L.T.DA

14

15

TELEGUARDIA, L.T.D.A

SIVIGELS PERÚ, S.A.C

CCTV, alarms

CCTV, alarms, GPS

Alarms

Country

Income USD

Year / income

Rodrigo Torres Guevara 57 1 417 3730 rodrigo_torres@hotmail.com www.marnell.com.co

$3.690.000 (*L)

Modeling

Pablo Camacho 59 1 2 215 8000 gerenciageneral@protel.com.bo www.protel.com.bo

$3.000.000 (*E)

2021

Colombia

Tibitzaith Olarte 57 1 742 4954 imperio.mediostecnologicos@gmail.com www.seguridadimperio.com.co

$2.070.000 (*L)

Modeling

Colombia

Nerso Arlevis Benitez 57 4 444 1926 direcciontecnicaydeproyectos@ segurtronic.com www.segurtronic.com

$2.010.000 (*D)

2020

Ecuador

Carlos Andres Urresta 593 2 322 6426 gerencia@anpriseg.com www.anpriseg.com

$1.860.000 (*D)

Modeling

Colombia

Juan Vasquez 57 4 606 9999 mercadeo@teleguardia.com www.teleguardia.com

$285.257 (*D)

2020

Homer Santillan Toro 51 4 4 20 0555 sivigelperu@hotmail.com info@sivigelperu.com www.sivigelperu.com

$206.000 (*D)

Modeling

Colombia

bolivia

Peru

Contact

Source: (*D) Dun & Bradstreet Data Cloud, official figures based on financial reports originating from some operating companies. Data consulted until February 24, 2022. (* E) Interviews with companies carried out through EncuestaDatos. (*L) Latin Press, INC. * Note: The sources correspond to the data of annual income and year of income. The modeled figures correspond to estimates and projections made on the last year in which the they had data. The year (income) shown in the table is based on the latest information available.

The numbers of the positions that present ** indicate that the companies were located based on the years of experience in the market, this is done because the data corresponding to the income obtained through the platform represent the same value.

38

Southern Cone N°

Company

Segments served

Country

Income USD

Year / income

Juan Manuel Gestoso 54 11 401 4 3200 info@securitasargentina.com www.securitasargentina.com

$ 76.880.000 (*D)

2020

Juan Báscoli 56 09 614 94635 juan.bascoli@verisure.cl www.verisure.cl

$60.020.000 (*D)

Modeling

Fernando Pesce 54 11 4630 6600 fernando.pesce@ar.g4s.com ww.g4s.com.ar

$58.830.000 / $24.890.000 (*D)

Modeling

$32.790.000 (*D)

Modeling

Contact

1

SECURITAS ARGENTINA

CCTV, alarms

2

VERISURE CHILE SPA

Alarms

3

G4S

CCTV, fire detection

4

SEGURIDAD Y TELECOMUNICACIONES, S.A (SECURITY SAT)

CCTV, alarms, GPS

Chile

Juan A. Echeverria 54 600 600 5100 esac@securitysat.cl www.securitysat.cl

5

ADT SECURITY SERVICES, S.A

CCTV,alarms

Chile

Matias Echavarria 600 600 0238 www.adt.cl

$30.170.000(*D)

Modeling

6

PROSEGUR

CCTV, alarms

Uruguay/ Argentina/ Chile

Maximiliano D’ario 54 11 4838 2350 maximiliano.dadario@prosegur.com www.prosegur.com.ar

$26.750.000 (*D)/ $8.740.000 (*D)/ $1.500.000 (*E)

Modeling/ Modeling/ 2021

Geza Fried 56 994 41 8939 gfried@firstsecurity.cl www.firstsecurity.cl

$26.000.000 (*E)

2021

Argentina

Óscar Albiero 54 38 1430 5677 oscaralbiero@albieroseguridad.com.ar www.albieroseguridad.com.ar

$2.800.000 (*L)

Modeling

Argentina

Mónica Fogeler 54 37 5244 0940 mfogeler@seguridadmisiones.com.ar www.seguridadmisiones.com.ar

$2.160.000 (*L)

Modeling

Argentina

Francisco J. Alberton 54 911 681 17662 reyjhonny@gmail.com www.uss.com.ar

$1.410.000 (*D)

Modeling

7

FIRST SECURITY

Alarms, GPS

8

ALBIERO HNOS, S.R.L

CCTV, alarms

9

SEGURIDAD MISIONES, S.R.L

CCTV, GPS, wireless communicators

10

USS SERVICIOS UNIDOS DE SEGURIDAD, S.A

Alarms, GPS, fire detection

Argentina

Chile

Argentina/ Uruguay

Chile

Source: (*D) Dun & Bradstreet Data Cloud, official figures based on financial reports originating from some operating companies. Data consulted until February 24, 2022. (* E) Interviews with companies carried out through EncuestaDatos. (*L) Latin Press, INC. * Note: The sources correspond to the data of annual income and year of income. The modeled figures correspond to estimates and projections made on the last year in which the they had data. The year (income) shown in the table is based on the latest information available.

The numbers of the positions that present ** indicate that the companies were located based on the years of experience in the market, this is done because the data corresponding to the income obtained through the platform represent the same value.

MONITORING MARKET RESEARCH REPORT

39

CHAPTER 4 40

USE VIDEO SURVEILLANCE FOR MONITORING IN LATIN AMERICA

The current health crisis has made it urgent to adopt technologies such as IP video surveillance for the development of smart and safe cities. The main objective of smart cities is to use technology to improve the quality of life of their inhabitants. In this sense, the implementation of video surveillance systems has proven to be key, not only to safeguard security, but also to identify mobility habits and, in the context of the pandemic, compliance with recommended health measures.

It is then, according to a study conducted by Sidarel Engie: “There is a steady migration of people to the world’s cities, so that by 2050 66% of the world’s population will be living in cities’’.

deo surveillance systems.

Faced with this scenario, different companies specialized in CCTV solutions, stated that “video surveillance allows streamlining road traffic, territorial distribution, strengthen health measures (by applying monitoring protocols that allow compliance with hygiene standards such as healthy distance or the use of masks) and improve the management of government programs, as well as increase urban resilience, which can be improved with monitoring systems and data analysis, which helps to improve the quality of life of the inhabitants”.

In recent years, more and more urban developments in Latin America are joining this trend. According to the Inter-American Development Bank (IDB), locations in Mexico such as Ciudad Creativa Digital and Tequila Inteligente in Jalisco, Maderas in Querétaro and Smart City in Puebla, are considered smart cities.

It is also worth noting that according to the World Economic Forum, it is the protection of personal data, privacy and cybersecurity, which is why it has undertaken an alliance in which it has recruited a group of 36 “pioneer cities” that will collaborate with global experts to improve policies on these aspects, in addition to better services for people with disabilities and better broadband coverage.

On the other hand, Mexico City, Monterrey and Leon are beginning to move towards this urban digitalization due to their infrastructure and capacity to implement intelligent solutions such as public Wi-Fi points, intelligent lighting systems and complex vi-

In this regard, a report by research firm Guide house Insights forecasts that annual global cybersecurity revenues from smart cities will amount to US$7.6 trillion by 2021, while this amount could reach US$26 trillion by 2030.

MONITORING MARKET RESEARCH REPORT

41

On the other hand, the Economic Commission for Latin America and the Caribbean estimates that approximately 80% of the population is concentrated in urban areas. This region represents one of the largest territories in the world, and with this, one of the main challenges is in security issues due to its growing urbanization, in this sense, video surveillance has positioned itself as a cornerstone for the development of cities.

According to Omdia’s latest video surveillance and analytics intelligence database, global video surveillance market revenue is forecast to reach US $24 trillion by the end of 2021.

Omdia forecasts total video surveillance market revenue to grow to US $31.9 trillion by 2025 with a total CAGR of 7.1 % between 2020-2025. The market size of the thermal body temperature solutions market has grown rapidly to US $1.3 trillion globally by 2020.

Driven by COVID-19 cautions, this technology has been adopted by several regions, particularly China, East Asia, India and the Middle East. However, without the growth of body temperature thermal solutions, the global video surveillance equipment market declined by 3.8% globally in 2020.

However, the market for body temperature thermal solutions is forecast to decline rapidly by 2021 to only US $137 million, a decrease of 89.8 %, which will ultimately limit the overall growth of the video surveillance market.

It is worth noting that due to the shortages and price increases in the industry, there has been a growth in demand for specialized components (Tablets, Laptops), which has led manufacturers to focus their production lines on these. Many high demand components have increased prices up to 1000 %, which has caused a device to increase its cost from 5 % to 45 %.

Physical Security Market Forecast 2020 to 2025 The impact of Covid-19 Scenario 1 Return to normality Q1 2021 / Vaccine adopted en masse Q1 2022 Scenario 2 Return to normality Q1 2022 / Vaccine adopted en masse Q3 2022

70 60 50 40 30

34.3 34.3

20

32.4

33.7

31.7

32.6

2020

2021

37.1 35.2

40.4

44

47.5

37.7

39.9

42.3

2023

2024

2025

10 0 2019

2022

Note: The values correspond ​​ to the number of vaccines purchased for each quarter.

Source: IHS Markit

42

Growth opportunities for video surveillance based on supply and demand

Video surveillance in the world Number of surveillance and security cameras (CCTV) per km2 in a selection of cities in 2020

London New Delhi Beijing Paris Guadalajara Buenos Aires Moscow Barcelona Mexico City New York Bogota Rio de Janeiro

399.27 289.42 277.51 254.59 170.01 77.34 76.86 71.01 58.59 25.97 20.96 11.47

The study included the 150 most populous cities in the world. Source: SurfShark

Video surveillance systems have evolved in recent years thanks to increased image quality and the integration of technologies such as embedded connectivity, next-generation thermal sensors and a wide variety of software innovations. But last year, geopolitical tensions and spending restraint due to the healthcare crisis led to a decline in sales of conventional systems.

of 7.1 % between 2020 and 2025, and could reach about $ 31.9 trillion by the end of the period.

According to the latest data from research firm Omdia, sales grew by only 2.2 %, and that was thanks to accelerated demand for thermal solutions that were implemented to monitor symptoms of COVID-19 disease. This segment increased its sales to $1.3 trillion, and without its contribution to the overall figures, the video surveillance market was down 3.8 % compared to 2019. Looking ahead to this year, sales of thermal systems are expected to decline by 89.8 %, limiting overall growth possibilities.

As Oliver Philippou, Physical Security research manager at Omdia, commented: “The semiconductor shortfall driven by geopolitics and the impact of COVID has affected all industries, and video surveillance is not an expectation. This supply/demand disparity is expected to last until mid-2022”.

In relation to this, experts believe that the economic revival will allow the market to grow again to about $24 trillion by the end of 2021, and will continue to do so at a compounded year-on-year rate

It is worth noting that new government and corporate video surveillance use cases will become a driver of the global market, once the situation around the pandemic and economic instability has normalized.

For its part, China is going to moderate its investment in video surveillance systems, due to the end of the Xue Liang program, whose investments enabled it to increase its spending on these technologies last year by 6.4%, to account for 50% of the total. Although they will not continue at the same pace from this year onwards, it is expected that Chinese authorities and companies will continue to make a decisive contribution to the global market.

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Implementation of video surveillance by country Mexico, Central America and the Caribbean

Mexico As a preventive security measure, the authorities have opted for the installation of around 15 thousand video surveillance cameras. In the metropolitan area there are at least 35 thousand cameras placed on top of poles; each one is connected to a control, computing and command center that is in charge of monitoring them 24 hours a day. This center attends to and corroborates crimes and emergencies reported.

Statistics reveal that 3.4% of the crimes in the city are captured by this type of security system. On the other hand, their placement causes a displacement effect of criminal acts to unmonitored areas.

According to Lucía Carmina Jasso López, from the Institute of Social Research of the UNAM, “this phenomenon is known as the “cockroach effect”: criminal activity moves a radius of 250 meters away from the point where the camera is located, which reduces the incidence of crime in the area”.

Additionally, the specialist stated: “The main objective of these security systems is to create spaces that generate the perception of security through surveillance and monitoring of the cameras, which is why many people in the CDMX decide to invest in this type of system. They take into account the effectiveness against major crimes and that in case a crime occurs there is video evidence”.

Installation of video surveillance cameras

40.000

30.000

20.000

10.000

0 Source: Latin Press, graph with data from Fundación UNAM, A.C.

44

Installation of additional video surveillance cameras Metropolitan area Crimes captured (Calculations by number of cameras)

Costa Rica More than 1,300 security cameras have been deployed throughout the country.

According to data from the Costa Rican Chamber of Information and Communication Technologies (Camtic) the niche of Information Technology services generates sales of $1.3 trillion of dollars a year in the country and is increasing by almost 5% since 2018.

In Costa Rica, the video surveillance system is provided to several municipalities with high-definition technology; it has facial recognition, motion detection and a storage system with the capacity to record material for 30 days uninterruptedly.

At the same time, different implementations have been developed in the country such as the CCSS electronic surveillance network, which is complemented with other schemes that the institution has such as infrastructure, human resources and protocols for the attention of events.

The CCSS electronic surveillance systems are hightech and can be observed from the Institutional Monitoring Center located in the central offices, in parallel with other local and regional monitoring centers.

The system allows real-time observation of what is happening, for example, at the Tony Facio, Guápiles, Calderón Guardia, and Desamparados Integral Care Center hospitals, among others.

Increase in cameras (5% per year) 2,0 %

Security cameras 2018

1,5 %

2019 1,0 %

2020 2021

0,5 %

0% Source: Latin Press chart with data from Ibux, the technological firm of the Heredia Public Services Company (ESPH).

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El Salvador The Government of El Salvador, through the Ministry of Public Works, began the process for the design, financing, installation, equipment, operation and maintenance of a lighting and video surveillance system on the country’s highways, in order to increase the road and citizen safety for the benefit of 26 municipalities.

The estimated official budget for the lighting and video surveillance project is $12,346,331 dollars, whose value is referential and considers the nominal value of the public infrastructure works of the PPP contract, including all project costs, general expenses and public services, payments of the participants during the construction stage and the costs for the preparation of the engineering project.

On the other hand, it is highlighted that municipalities such as Villa El Salvador began the execution of the first monitoring and video surveillance center in the history of the district. The information from the 250 security cameras installed throughout the district reaches the central office. In addition, 150 warning megaphones and 70 push buttons can be handled.

To this end, according to chief engineer Pedro Vizcarra Vargas, 200 13-meter-high poles are being built where the video equipment will be placed and which will be complemented by another 1,200 poles that will serve to install a fiber optic network.

Number of monitoring and video-surveillance systems at the El Salvador plant

1.500

1.000

50

0 Source: Latin Press graphic with official data.

46

Security cameras Alert megaphones Buttons Fiber optic network (installation of poles)

Guatemala More than 60 Guatemalan companies contributed Q3 million 865 thousand for the installation of video surveillance cameras in order to improve citizen security in the urban area of Antigua Guatemala, through a public-private alliance between the municipality of Antigua Guatemala and the business community.

This alliance consists of the installation of 275 video surveillance cameras and 38 emergency buttons. It also includes an intelligent monitoring center with advanced technology for the monitoring of the respective cameras.

Business investment in security systems

1.000 750 500

250

Video surveillance cameras Emergency buttons Number of companies that invested Value of business investment (thousands of dollars)

0

Source:Latin Press, graph with data from the Ministry of the Interior.

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Panama Juan Manuel Pino Forero, Panama’s Minister of Security, has expressed his desire to install more video surveillance cameras and expand the capacity of the National Operation Center to deal with crime. Thus, it will have the capacity to house up to 10,000 cameras and it is estimated that the project will cost approximately US $40 million.

On the other hand, in the municipality of La Chorrera the implementation of video surveillance began. This is done through an Interconnected System, which allows for a prevention and security platform that also integrates other services (National Police, Firefighters, SUME 9-1-1 and Sinaproc), where monitoring processes, surveillance control and use of technologies are automated to establish a fundamental tool to combat criminal groups and provide emergency relief in times of emergency.

The investment cost of this project is US$7.5 million, which includes the supply of equipment, installation, maintenance and the data link service.

In this first phase, the La Chorrera Municipal Operations Center has 128 video surveillance cameras operating at strategic points in the urban districts.

The video surveillance cameras will also be installed in all rural areas of the district, which will be strengthened with the installation of a fiber optic network to ensure connectivity at the sites.

At the same time, the project will have a second phase where about 200 cameras will be installed, which will be placed in 56 other strategic sites in the district, including 50 cameras with artificial intelligence among other technological innovations.

Installation of video surveillance cameras

400 300 200

Number implemented

100

Investment (USD MILLION)

0 Cameras (National Operation Center Project) Source: Latin Press, graph with data from the Ministry of Public Security.

48

Interconnected System (La Chorrera)

Dominican Republic The current project for the implementation of a video surveillance system that will operate in the northeastern border zone contemplates the expansion in the provinces of Valverde, Santiago Rodríguez, Montecristi and Dajabón. This expansion of the system will have 59 video surveillance points and 258 cameras.

It must also have a fiber optic transmission network owned by the Dominican State, backup power supply system for the camera system, among other features. It has a reference value: US $6,000,000.

Security cameras have been installed in 49 municipalities in the country, 4,500 cameras have been placed to detect emergencies in public spaces. The rest are used by banks, offices, residences and other establishments. Although the number of these devices is difficult to determine, one can get an idea of the importance that Dominican society is assigning to video surveillance by knowing that in the first five months of this year 191,136 high resolution digital cameras have been brought into the country for security systems.

Another relevant fact is that, according to statistics provided by the Directorate General of Customs, in the last 10 years Dominicans have paid an FOB value of US $136,684,587 to acquire this type of merchandise.

In relation to the above, the Directorate of Operations of the National System of Emergency Attention and Security 9-1-1, which provides attention to emergencies reported by citizens from the reception of calls and the dispatch of units to the coordination of the response, reported that last year the investment in video surveillance was equivalent to 70% of the monetary resources of the project portfolio.

Likewise, it was argued that the work entailed the installation of 922 cameras throughout the national geography, which made it possible to reach 49 municipalities in 14 provinces of the country, enabling a significant expansion of the areas under surveillance and control of the authorities.

Implementation of video surveillance system video surveillance points

Surveillance points

300 250

Cameras (pending installation)

200

Cameras installed nationwide

150 100

High resolution digital cameras

50

Value paid for cameras purchased (US$ million)

0 Source: Latin Press, graph with data government data and data from the General Directorate of Customs.

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Andean Region

Bolivia In the semester November 2020 - April 2021, 18.6% of the population aged 15 and over was a victim of some criminal act, according to the National Institute of Statistics and Informatics (INEI) in the technical report Statistics of Citizen Security. The population between 30 and 44 years of age was the one that faced this type of incidents.

On the other hand, another 190 video surveillance cameras and a new monitoring center will be implemented in the country, with an investment of USD $24.586.647, where the State will provide 95% of the financing and the remaining 5% will be provided by the municipality of El Alto.

Video surveillance financing 200 180 160 140 120 100 80

Investment (in millions of bolivars)

60

State funding (%)

40 20 0

Source: Latin Press, graph with data from the National Institute of Statistics and Informatics (INEI).

50

Implementation of video surveillance Security cameras

Colombia In the country, citizen perception regarding security indexes has reflected dissatisfaction, since in most cases they feel insecure. The most recent survey of coexistence and citizen security, conducted by DANE, showed that 44% of Colombians feel insecure; this means that more than 16 million people.

in networks of a video showing a crime captured by these cameras makes people feel more at risk.

Despite this, there are more and more people interested in using security cameras, even in private spaces, and for formal and informal commerce, these products have become a new business niche.

Additionally, 77% of Colombians do not feel safe when they go to a commercial establishment. In fact, it is the third place where Colombians feel less safe, the first is in crowds in public at 84% and the second, in public transportation at 79%.

When consulting websites of large surfaces, it is evident that a security camera can be obtained from $139,000 to $1.1 million (Colombian pesos) for a system of 8 surveillance cameras.

This is why, according to Juan Carlos Ruiz, an expert from the Universidad del Rosario, explains that the use of cameras has a positive impact on crime reduction, although not on the perception of security. He adds that, for example, the dissemination

To this must be added the cost of installation, because the more complex the system is, the more technical work it requires. On average, it costs $870,000 (Colombian pesos) for 8 cameras, and it goes up as the number of devices increases.

Security rates increase the acquisition of cameras 90 80

Colombians feel insecure in the streets (millions of citizens)

70 60

Perception in % (insecurity in the commercial sector)

50

Perception in % (insecurity in crowded public places)

40 30

Perception in % (insecurity in public transportation)

20 10 0 Fuente:Gráfico Latin Press con datos del Departamento Administrativo Nacional de Estadística- DANE.

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Ecuador More than 4,460 home robberies, 2,564 business robberies, 2,676 stolen cars and 12,475 assaults on persons. These are figures of the main crimes reported, between January and last August, at national level, according to statistics of the Attorney General’s Office (FGE), all with increases ranging from 16.1% to 58.1%, compared to the same period of 2020.

According to different experts, these numbers are accompanied by a perception of insecurity that has also generated a growth in the demand for security cameras, equipment, alarms and physical and electronic guarding services.

According to the document, surveillance equipment from only two foreign companies is used on a large scale in Ecuador, but this does not make the outlook any less bleak. In this country, this equipment is integrated into a police surveillance system created in 2010 to combat crime called ECU 911, which

monitors more than 6,000 cameras throughout the country, according to Access Now. Relatedly, it is worth noting that some video surveillance cameras were installed by ECU 911 technicians at Ecuador’s Pedro Vicente Maldonado scientific station located in Antarctica. The cameras are designed to provide security and manage any emergency, but have also allowed them to capture unprecedented images of this point of the planet.

Additionally, the Local Operational Center has 183 video surveillance cameras in strategic locations in the province of Santo Domingo de los Tsáchilas. According to the national government “thanks to this equipment, from January to September 2021, 7,257 events have been captured in the province, of which 1,027 correspond to captures that have prevented possible incidents and crimes; of these, the months with the most reports were April (134), July (124) and September (134)”.

Number of crimes in the country increase video surveillance

14.000 12.000 10.000 8.000 6.000 4.000 2.000 0 Source: Latin Press, graph with data from the Attorney General’s Office (FGE).

52

4,460 home burglaries 2,564 business robberies 2,676 car thefts 12,475 assaults on persons

Peru The security market in Peru moves an average of US $400 million annually. Thus, there is a marked trend in the security & safety profile (risks associated with theft and crimes committed by third parties, as well as fires or dangers such as pandemics), which averages US $250 million in Peru, and which has grown by US $100 million due to the pandemic.

In this regard, the Inter-American Development Bank (IDB) stated that the cost of crime in Peru is equivalent to 2.77% of GDP, or more than US $10 trillion.

The need to adopt prevention and deterrence measures in the face of the increase in crime in the country drove the import of security and video survei-

llance cameras, which reached US $1.3 million in September, representing a 36.4% increase over the previous month, according to the Foreign Trade Development and Research Institute of the Lima Chamber of Commerce (Idexcam).

The imported value of this equipment has been registered since June 2020, in relation to the acquisition of equipment totaling US $1 million, an amount that evidenced an increase of 90.63 % compared to May. Although in July they amounted to US $333 thousand, which represented a drop in purchases of 67.18 %; in August the imported value amounted to US $995 thousand, an amount that showed an increase of 198.92 %, which continued in September.

Security market Costs associated with third party theft and crime (pre-pandemic) US$ million Costs associated with third party theft and crime (post-pandemic) US$ millions Imported value June 2020 US$ millions (Monitoring and video surveillance systems) Imported value July 2020 US$ thousands (Monitoring and video surveillance systems) Imported value August 2020 US$ thousands June 2020 increase % increase Decrease % July 2020 Increase % August 2020

0

200

400

600

800

1000

Source: Latin Press, graph with data from the Foreign Trade Development and Research Institute of the Lima Chamber of Commerce (Idexcam).

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Southern Cone

Argentina In April 2019, the Government authorized the implementation, through Resolution 398, of the System of Facial Recognition of Fugitives (SRFP). This is a program in charge of the Ministry of Security and Justice of the City in conjunction with the Buenos Aires Police, which aims to detect, identify and arrest fugitives from Justice. It comprises a software that operates on a rotating basis on 300 of the more than 10,000 CCTV security cameras on public roads.

For the facial recognition system, the procedure was a direct contracting of a “comprehensive video analysis service”. The agreement had a duration of 17 months at a cost of $1,511.3 trillion, with a start date of April 22, 2019. Once the expiration date pas-

sed in September 2020, an extension of the contract was made until February 2021, for an expenditure of $444,500. Therefore, the total investment in these devices at the time was USD 1,955,800.

At the same time, the use of the Digital Ring was consolidated: a security system with two monitoring centers, 498 license plate readers and 120 video cameras in 74 accesses to the City. These identify all vehicles using the entrances and exits and allowed a 90% reduction in extortive kidnappings.

As a policy, in the period 2019-2023 the City assumed the commitment to deepen the use of video surveillance cameras, bringing the coverage of the City to 54%.

Government spending on facial recognition system 2.500.000

2.000.000 Comprehensive video analysis service (April 22, 2019) USD million

1.500.000

Comprehensive video analysis service (February 2021)

1.000.000

USD million Total investment USD million

500.000

0 Source: Latin Press, graph with data from the Ministry of Security and Justice.

54

Chile In the diagnosis of the Undersecretariat for Crime Prevention determined that since 2012 in the government of Chile, the areas of affluence of Metro accesses occurred 13.3 % of all police cases in Greater Santiago for crimes in public space and 22 % of cases of robbery by surprise (lanzazos), while Transantiago stops concentrated 5.1 % of crimes against persons (robbery by surprise and robberies with violence or intimidation). The data collected made it possible to implement a targeted plan for the transport areas with the highest incidence of crime.

One of the projects that Chile has developed refers to impound parking, where the Metropolitan Authority of Santiago uses cameras to automa-

tically track thousands of cars that enter the city center every day, including analytics has provided new possibilities such tracking vehicles and people through cameras interconnected to the system within the place, in addition to those installed at strategic points and public transport.

Currently in this country there has been a significant reduction in robberies, with a decrease of 0.7%; theft, with a decrease of 4.0%; and vehicle theft with a decrease of 2.0%, according to data provided by the National Urban Survey of Citizen Security 2020. These data serve as an indicator to show how the adoption of video surveillance systems contributes to improve the quality of life of citizens.

Decrease in theft crimes

4,5% 4,0% 3,5% 3,0%

Theft

2,5%

Vehicle theft

2,0%

Decrease in relation to the average

1,5% 1,0% 0,5% 0 Source: Latin Press, graph with data from Undersecretary of Crime Prevention.

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CHAPTER 5 56

GROWTH AND OPPORTUNITIES IN THE MONITORING MARKET

Monitored Accounts

World Market for Residential Alarm Monitoring

47.000 46.000 45.000 44.000 43.000 42.000 41.000 40.000 39.000

2017

2018

2019

2020

Source:Omdia

During 2020, the global market for monitored residential security was expected to exhibit stability, originating from the 0.8% not very significant increase in the number of accounts. This was stated in Omdia’s 2020 Residential Remote Monitoring Report. In turn, the forecast projected a 3.8% growth for that year.

As Blake Kozak, principal analyst at Omdia, argued: “In both good and bad economic times, consumers have been willing to open their wallets to spend on residential alarm monitoring, generating steady growth in the number of accounts worldwide” Against this, he added: “However, the COVID-19 crisis is on a completely different scale to previous recessions. Not only has the pandemic affected consumer spending, but mass quarantines have inundated almost every country in the world. Consequently, the residential alarm monitoring industry is set to experience a sharp reduction in growth for the remainder of 2020”.

It is then that forecasts for the Europe, Middle East and Africa (EMEA) region were estimated to grow to a total of 2.5% in 2020. The reduction forecast for Asia is more significant, as it estimated the number of accounts in the region to show an increase of only 1.5% for that year, a factor of five percentage points less than the previous expectation of 7.6% growth.

2021 2020 Omdia

It is worth noting that North America is the largest alarm monitoring market, with approximately 41% of the market share. China, in turn, is also strong within the market, accounting for approximately 15% of the market share.

The global alarm monitoring market size is projected to reach USD 54.27 trillion by 2027, from USD, 41340 million in 2020, at a CAGR of 4.0 % during 2021-2027.

Global intrusion/perimeter protection products market sales (US$ billion) 8 7 6 5 4 3 2 1 (USD) 0 2019

2020

2025

Compound annual growth rate (%)

Source: Own graph. Data taken from Memoori.

MONITORING MARKET RESEARCH REPORT

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On the other hand, according to Memoori: “the main growth driver in the next 5 years will be the increase in investment in industrial complexes, especially in Asia and the BRIC countries. Advances in wireless and sensor technologies and new radar detection products along with the integration of video surveillance, access and outdoor lighting are strengthening this market” Furthermore, the market research emphasizes that “growth has increased marginally over the last 5 years and when the physical security business “returns to normal” it is expected to have the potential to generate 5% growth. For Western manufacturers, it is more stable in the market than the video surveillance business and, at this time, is not threatened by low-cost Chinese products.”

Fire detection market demand

Demand in the global fire detection market has been argued to exceed $40 trillion in 2020 and will continue to grow over the next seven years, according to analysts at Grand View.

According to estimates: “developments followed by

cost-effective products and service and maintenance pole installations will go a long way in supporting sales. Suppliers aim to launch new products and take advantage of opportunities in emerging markets by developing a local sales network and closing new business deals”.

From another angle, trade journals projected that the global Advanced Fire Detection and Suppression Systems market was valued at USD 8,306 million in 2020. In relation, it is expected to reach USD 11.42 trillion by the end of 2026, at a CAGR of 4.6% for the period 2021-2026.

Global Market Fire prevention and detection systems: causes and restraints

It is important to highlight that the supply and demand of fire detection monitoring systems is becoming more important in the face of the diverse situations presented in some countries, where public policies must invest much more in the acquisition of these systems, since according to data, several South American countries have been the epicenter of de-

South America Satellite-detected fire hotspots in South American countries in 2020 Brazil

139.316

Argentina

51.324

Venezuela

34.745

Paraguay

24.000

Colombia

19.889

Bolivia Peru Chile

15.851 10.935 2.881

Data from January 1 to September 16, 2020. Variation compared to the same period of the previous year. Selected countries.

Source: National Institute for Space Research (INPE)

58

+12% +171% +29% +61% +35% -43% +9% -5%

vastating fires in recent months. In many regions of the subcontinent, the stoppage of activities due to the COVID-19 pandemic did not bring about an improvement in the rate of occurrence of wildfires.

From January to September 2020, nearly 140,000 fires were detected by satellite in Brazil, according to the country’s National Institute for Space Research (INPE). Of these, almost 102,000 burns occurred in the Legal Amazon region, which covers nine states in northwestern Brazil.

Compared to last year, Argentina is the territory most affected by the growth of fires in the Southern Cone. So far in 2020, more than 51,000 outbreaks have been recorded in the southern country, almost triple the less than 19,000 detected in the same pe riod last year.

Growth of remote monitoring in relation to IoT solutions

Remote monitoring helps companies in all industries to maintain security and prevent risks. For its implementation, IoT solutions, sensors, equipment and video surveillance networks are used to help manage risks due to internal and external threats.

With its application, multiple benefits are achieved for companies, their staff and customers themselves.

According to a report by Global data (Thematic Research: Internet of Things), the global IoT market will

reach a revenue value of up to 1.1 trillion dollars by 2024, which mentions that much of the growth will come from wearables.

And that is that, the global internet of things market reached in 2020 a value of 622,000 million dollars in 2020, compared to 586,000 million in 2019, and it is estimated that it could reach 1,770,000 dollars by 2024, with an annual growth rate of 13% during that period. Therefore, this area will play an important role in ensuring connectivity and maintaining competition among companies.

Internet of Things from the Ground Up: Physical Devices and Controllers On the other hand, according to research firm Markets and Markets, the global Internet of Things (IoT) solutions and services market size is expected to grow from USD 139.3 trillion in 2019 to USD 278.9 trillion by 2024, at a CAGR of 14.9% on average during this period. The major drivers for the market growth are the increasing need for decentralized monitoring and predictive maintenance and development of wireless technologies.

IoT has changed the way businesses used to operate. For example, healthcare facilities use IoT devices to improve their medical outcomes. The manufacturing industry analyzes how its products are used and

Millions of Dollars 50,000 45,000 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000 0

2013

2014

2015 Consumer

2016 Automotive

2017

2018 Industrial

2019 Other

2020

Fuente: Tech Data Authority blog - Tech Data Corporation.

MONITORING MARKET RESEARCH REPORT

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determines usage patterns, as well as to increase efficiency, which helps in daily operations, facilitates the optimization of production quality and provides high-level security.

Among the main applications of the technology are cost optimization for industrial companies and transportation through remote monitoring of devices and vehicles, predictive maintenance of equipment, collection of sensor data for real-time production analysis, and tracking of final cargo delivery.

With the total number of IoT connections expected to reach 25 trillion by 2025, IoT service management is likely to play an important role in ensuring connectivity and maintaining business competence.

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CHAPTER 6 62

RISING FREIGHT AND CARGO PRICES - WHAT’S THE REASON?

FREIGHT AND CARGO MOVED ON DIFFERENT ROUTES FROM LATIN AMERICA (PERCENTAGE) 10.0% 5.0%

8.0% 2.3% -0.2%

0.0% -5.0%

2.2%

1.5%

-2.5% -2.3% -6.0%

-10.0%

-20.0%

Variation exports

-11.8%

-6.0%

-9.9%

-9.80% -16.2%

Europe

1.5% 1.0%

0.2%

-3.5%

-15.0%

7.0%

Asia

Freight Variation exports

North America

Variation imports

-18.9% Middle east + indian

Within Latin America

Freight Variation imports

Comex

Source: Economic Commission for Latin America and the Caribbean (ECLAC) based on information from Drewry.

The increase in product prices, the scarcity of raw materials and the high costs of container shipments are other concerns for industry businessmen in terms of distribution and logistics. In addition, it is possible that the supply of some integrated systems, equipment, among others, may decrease. In relation to this, if there is an increase in demand in this scenario, the price increase would be much higher.

Alessandro Nicita, economist at the UN trade agency (UNCTAD), explains that it is the strong recovery of exports in the world that is generating a real shock: “If trade were depressed, there would be no crisis”.

According to Javier Diaz, president of Analdex, “this situation has generated a shortage of containers, defaults in itineraries and an accelerated increase in transportation costs. Thus, the average freight rates of 20-foot units from China to Latin America, for example, are now almost five times higher than the average of the last 12 years”.

Before the pandemic, shipping a container from Asia to Latin America and vice versa cost an average of $2,000 USD and sometimes as much as $1,500 USD,

and today it is hardly possible to get sea freight on that route for less than $8,000 USD. The Asia-Europe corridor, on the other hand, reaches rates in excess of $10,000 USD and up to $14,000 USD for a single voyage.

This is in addition to the increase in freight rates from Asia to the Americas. According to data available from the Freight Baltic Index (FBX), freight rates have been increasing over the last year. Such is the case from the East Coast of North America to China/ East Asia (10% increase) while from the East Coast of North America to Northern Europe there is a decrease of 18%. Thus, the price volatility for freight rates is 2.3%. The prices for these areas remain at $10,519 USD, which is equivalent to an increase of 2 %.

From another point, as shown by the SFCI index, which is the most used indicator to measure ocean freight rates and analyzes the costs of routes with China for 20-foot containers, this has gone from just over 700 points at this time in 2019, to more than 4,500 points at the end of August, i.e., a growth of almost 530%. This figure is higher on some routes.

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Increase (annual) in prices relative to the Global Index container loading Desde

03-Sep-2020

a

03-Sep-2021

$10.000 $7.500 $5.000 $2.500

01-Nov-20

01-Jan-21

01-Mar-21

01-May-21

01-Jul-21

01-Sep-21

Source: Freight Baltic Index (FBX).

Note: The price increases (annual: September 2020 to September 2021) shown in the graph are related to the Global Container Freight Index (USD values).

High freight rates overshadows the economic recovery The United Nations Conference on Trade and Development (UNCTAD) warned that “global consumer prices will increase significantly by 2023 until supply chain disruptions, port constraints and port terminal deficiencies are addressed.

The impact of high freight rates will be greatest in Small Island Developing States (SIDS), which could see import prices rise by 24% and consumer prices by 7.5%. In the Least Developed Countries (LDCs), consumer price levels could increase by 2.2%.

Thus, the current increase in container freight rates, if sustained, could increase world import price levels by 11% and consumer price levels by 1.5% by 2023.

Supply chains will be affected by the rising costs of maritime trade. Low value-added goods produced in smaller economies, in particular, could suffer a serious erosion of their comparative advantages.

“The current increase in freight rates will have a profound impact on trade and undermine socio-economic recovery, especially in developing countries, until shipping operations return to normal,” said UNCTAD Secretary-General Rebeca Grynspan.

“Getting back to normal would mean investing in new solutions, including infrastructure, freight technology and digitization, and trade facilitation measures,” she said.

64

A 10 percent increase in container freight rates, coupled with supply chain disruptions, is expected to lower industrial output in the United States and the euro area by more than 1 percent, while in China output is expected to decline by 0.2 percent.

UNCTAD urges countries to consider a package of measures covering tangible and intangible infrastructure. Improving the quality of port infrastructu-

re would reduce average global shipping costs by 4.1%, while costs would be reduced by 3.7% with trade facilitation measures and by 4.4% with improved liner shipping connectivity.

Forecast

ECLAC estimated that the value of regional exports of goods would grow by 25% during the current year, following a 10% drop in 2020, driven by a 17% growth in prices and 8% in quantities shipped out of the region.

The UN agency stresses that the increase in exports of goods was mainly due to higher commodity prices, especially minerals, hydrocarbons and agroindustrial products, rather than an increase in the volume exported.

It also indicates that regional exports of services continue to fail to recover from the drop they suffered due to the coronavirus pandemic.

“In particular, regional dependence on tourism far exceeds the world average, so the uncertainty about the reopening of this sector negatively conditions the prospects of several economies, especially in the Caribbean,” ECLAC warns. “In sum, the recovery of regional trade in 2021 shows important weaknesses”.

In relation to this last point, the agency calculates that the global average cost of container freight by sea has risen by more than 660% from June 2019 to date.

On the other hand, the value of regional imports of goods would register an increase of 32% with an expansion of 20% in volume and 12 % in prices.

Looking ahead to 2022 forecasts, the agency projects growth in the value of regional exports and imports of 10% and 9%, respectively.

The highest trade activity was recorded with China and at the regional level. The projected annual variation in regional exports to the Asian country is 35%, followed by 33% intra-regional, and a growth in shipments of 23% to the European Union and 19% to the United States.

MONITORING MARKET RESEARCH REPORT

65

CHAPTER 7 66

OUTLOOK FOR LATIN AMERICAN ECONOMIES (PANDEMICPOST-PANDEMIC)

Volatility in financial markets

By 2020, the world’s GDP is expected to shrink the most in comparison to 1946, as a result of a generalized fall in economic activity in both developed and emerging economies. Similarly, the crisis has triggered a contraction in international trade, which in turn has led to sharp fluctuations in high prices as a result of volatility in the financial markets, resulting in lower profitability and greater risk aversion.

The economic instability generated by the pandemic in international financial markets and the uncertainty in commodity markets led to strong exchange rate corrections, which gave way to considerable fluctuations in the region’s currencies during the first three quarters of 2020. Most Latin American and Caribbean currencies depreciated against the dollar. Thus, in the first ten months of 2020, 17 of the region’s economies recorded currency depreciations, with an average depreciation of 16.3%.

In addition, pandemic containment measures adopted in the vast majority of the world’s countries have had a significant impact on tourism and commercial aviation, restaurant and hotel service activities.

However, the measures adopted by some of the governments of Latin American countries to deal with the effects of the pandemic have helped to mitigate the economic impact on the social and business fabric of the region. The case of the fiscal monetary packages, for amounts close to 12 trillion dollars in fiscal actions and 7.5 trillion dollars in monetary actions announcements have cushioned the fall in economic activity, but this has also caused high levels of liquidity, which has had repercussions in the increase of indebtedness at a global level.

In relation to the above, it should be noted that the variation in the nominal exchange rate against the U.S. dollar was divergent in the countries of the subregion. For example, the annual average for 2020, with respect to 2019, reports the largest depreciation in the Dominican Republic (10.2%), followed by Nicaragua (3.7%), while in Costa Rica, Guatemala and Honduras the average variation was close to zero (between 0.2% and 0.3%).

FINANCIAL MARKET VOLATILITY INDEX (JANUARY 2018 - OCTOBER 2020) 90 80 70 60 50 40 30 20

2019

Oct

Sep

Aug

Jul

Jun

May

Apr

Feb

Mar

Jan

Dic

Nov

Oct

Sep

Aug

Jul

Jun

Apr

May

Feb

Mar

Dic

Jan

Nov

Oct

Sep

Jul

2018

Aug

Jun

Apr

May

Mar

Jan

0

Feb

10

2020

Source: Economic Commission for Latin America and the Caribbean (ECLAC), based on Bloomberg Note: The VIX index, prepared by the Chicago Board Options Exchange (CBOE), measures expected volatility for the next 30 days and is obtained from the prices of call and put options on the S&P 500 index.

MONITORING MARKET RESEARCH REPORT

67

Thus, if risk perception were to change and risk aversion were to increase, this would have negative effects on emerging economies in general and on Latin America and the Caribbean in particular. Emerging economies would be more vulnerable to changes in financial market access conditions, given the sharp increase in debt ratios.

EMERGING MARKETS BOND INDEX 2020 Venezuela Argentina Ecuador

219,7%

Variation vs.

28/2/20 +79 -36

14,6%

-30

10,2%

Mexico Dominican Republic

4,7%

+26

4,5%

+12

Brazil

3,1%

+22

Colombia

2,4%

+14

Source: Central Bank of the Dominican Republic.

Note: “Spread” of the Emerging Markets Bond Index, known as “country risk”, in a selection of Latin American countries according to data from October 27, 2020.

According to the Institute of International Finance (IIF), the debt of governments and companies in developed countries reached 432% of GDP in the third quarter of this year, surpassing the record level of 380% of GDP recorded in 2019, while in emerging countries it reached 250%. The increase in debt was accompanied by a greater acceptance of risk by in-

7,7 % DROP IN LATIN AMERICAN GDP IN 2020, ACCORDING TO ECLAC.

68

vestors seeking higher yields. Much of the debt accumulation from the global financial crisis had been in the non-financial corporate sector, for which the disruption of supply chains and reduced global growth imply less optimal results and evidence of greater difficulty in repaying debt.

External shocks and new growth challenges for the region Thus, the magnitude of the effects of the crisis at the global and Latin American level has also been determined by structural factors such as their degree of integration in international trade and global value chains, their productive structure, demographic aspects and the level of formalization of labor markets.

The region’s historical structural weaknesses and gaps, limited fiscal space, low coverage and access to social protection, high labor informality, productive heterogeneity and low productivity are central to understanding the scope of the pandemic’s effects on the region’s economies, its difficulties in implementing policies to mitigate these effects and the challenges in undertaking a sustainable and inclusive economic recovery.

According to the Economic Commission for Latin America and the Caribbean (ECLAC): “ The health

A GROWTH RATE OF 5.2 % OF THE WORLD ECONOMY IS EXPECTED IN 2021, ACCORDING TO ECLAC.

emergency materialized in the worst economic, social and productive crisis that the region has experienced in the last 120 years, and in a 7.7% drop in regional GDP”.

Against this backdrop, ECLAC stated: “In the global arena, despite a slight upward revision of the projections made in mid-year, in 2020 the world economy was expected to suffer a 4.4% drop and a generalized recession in countries and regions. The growth dynamics reflect, in part, a better-than-expected second quarter for some of the major economies, thanks to the boost from fiscal packages and the rebound enabled by reopenings during the third quarter.”

In 2021, the said commission mentions that a rebound in the growth rate of the world economy of around 5.2% is expected.

In developed economies, a growth rate of 3.9% is projected for 2021, which implies that, on average, these economies will not reach pre-crisis GDP levels next year. Similarly, and with a similar forecast, the International Monetary Fund (IMF) projects world economic growth of 5.5% in 2021 and 4.2% in 2022.

Impact on trade and value chains On the other hand, with respect to world trade, according to the World Trade Organization (WTO), a

WORLD GDP WILL GROW BY

4,2 % IN 2022, ACCORDING TO THE IMF.

9.2% drop was forecast for 2020 and a 7.2% recovery in 2021. The 2020 drop would be the deepest since the 2009 global economic and financial crisis, when it was almost 13%. “Between January and September 2020, the volume of trade fell by 7.2% compared to the same period of the previous year, although since June there had been a recovery.”

It should be noted that Brazil and Uruguay recorded smaller declines in imports than the rest of the South American economies during the first half of 2020, while imports from Costa Rica, Guatemala and Nicaragua fell less than the Central American average.

It is also worth noting that in the first months of 2020 there was a sharp decline in commodity prices, from May onwards this was reversing and, with the exception of energy commodities, by October prices were already above pre-pandemic levels: 5% above the December 2019 level.

The IMF’s October projections point, on average, to a 9% increase in commodity prices: 4% in agri-food products, 3% in base metals and 16% in energy products.

In the context of Latin America and the Caribbean, the decline in commodity prices translated into lower export prices, especially in hydrocarbon exporting countries (-19%); agro-industrial and mining exporters faced a milder decline (-3%). Export volumes contracted in all subgroups, as the international crisis reduced external demand.

THE WORLD TRADE ORGANIZATION REPORTS THAT IMPORTS OF ALL LATIN AMERICAN COUNTRIES FELL DOWN BY DOUBLE DIGITS (-26.6%) IN MOST OF THEM IN 2020.

MONITORING MARKET RESEARCH REPORT

69

YEAR-ON-YEAR RATE OF CHANGE IN WORLD TRADE VOLUME (PERCENTAGES, BASED ON A SEASONALLY ADJUSTED INDEX) A.World 20 Projection WTO 2020: -9,2 2021: +7,2

13.9

15 8.9

10 7.1

6.0

4.7

5

4.9 1.4

0.8

2.3

2.8

1.9

3.5

1.0

0 -0.5 -5 -7.2

-10

Jan a sep 2020

2019

2018

2017

2016

2015

2014

2013

2012

2011

2010

2009

2008

2007

2006

-12,8 2005

-15

B. Selected regions and countries 15 10 5 0 -5 -10 -15 -20 -25 -30 -35

Ene

Feb

Mar

Abr

May

Jun

Jul

Ago

Eastern Europe and the Commonwealth of Independent States Africa and the Middle East Eurozone World United States Japan Latin America Emerging economies of Asia (excluding China) China

2020

Source: Economic Commission for Latin America and the Caribbean (ECLAC), on the basis of Netherlands Bureau of Economic Policy Analysis (CPB), World Trade Monitor [online database] https://www.cpb.nl/en/worldtrademonitor.

- World Trade Organization (WTO), https://www.wto.org/spanish/news_s/pres20_s/pr862_s.htm.

70

As for the Central American and Caribbean countries, excluding Trinidad and Tobago, the terms of trade would improve (by 5% and 3.4%, respectively) as a result of the large weight of energy in their import basket.

at the beginning of the COVID-19 crisis, the region’s sovereign risk has tended to decrease and stabilize thanks to the strong improvements registered in September in Argentina and Ecuador.

Remittances, which are a key component of the balance of transfers, have had a heterogeneous behavior among the countries. In Mexico, the main remittancereceiving economy (accounting for more than a third of the total flows received), remittances grew by 9% up to August 2020 compared to the same period of the previous year. They have also increased in Jamaica (18%), the Dominican Republic (11%), Nicaragua (9%), Guatemala (4%) and El Salvador (1%). On the contrary, in other countries remittances have decreased so far this year: this is the case of Bolivia (-2 %), Peru (-22%), Paraguay (-16%), Costa Rica (-10%), Ecuador (-10%), Honduras (-2%) and Colombia (-1%).

As measured by the Emerging Markets Bond Index Global (EMBIG), it reached 467 basis points at the end of October, well below the 702 basis points it closed at in April, but still above the 346 basis points it recorded at the close of 2019. Debt issuance in international markets during the first ten months of 2020 was 19% higher than in the same period last year. Sovereign bonds accounted for 40% of the total issued through October, followed by the private corporate sector (27% of the total) and quasi-sovereign bonds (20%).

In the meantime, according to Balance of the Economy of Latin America and the Caribbean developed by ECLAC in 2020 it is argued, “Despite the fall in exports, the region’s current account deficit will decrease significantly (to 0.4% of GDP from 1.8% of GDP in 2019) due to the strong contraction of imports. These present the worst performance since the global financial crisis: a 14% reduction in volume terms is expected. The value of the region’s exports would contract by 13%: export prices would fall by 7% and export volumes by 6%”.

BOND YIELDS IN SOUTHERN COUNTRIES Argentina 7Y 46,144 (0,000 (0,00%)) 43.300 - 43.300

50000

Chile 10Y 4,380 (+0,000 (+0,00%)) 116.323 - 116.323 Colombia 10Y 6,990 (+0,000 (+0,00%)) 104.525 - 105.005

40000 30000 20000 10000 0 -10000

Expiration date

Annual variation

Mexico 10Y 6,994 (+0,179 (+2,64%)) 107.287 - 107.401 Peru 10Y 5,407 (+0,000 (+0,00%)) 111.680 - 111.871

Source: Data taken from Investing. Own graph.

Balance of financial flows in the region

Another important aspect in the Latin American economy is the dynamics of financial flows to the region, which has been influenced by increases in global liquidity. The leading indicator of financial flows prepared by ECLAC shows that, in the third quarter of 2020, financial flows to the region continued on their recovery path, which coincides with the evolution of bond issues of the region’s countries in international markets. It is estimated that the average financial flows received by the region during that year allowed both to cover the current account deficit and to accumulate reserves.

On the other hand, after the increase experienced

GDP evolution in Latin America It is then that economic growth, in the economies of South America, fell in the first three quarters to a rate of -7.7% of GDP year-on-year, compared to close to zero growth in the same period of the previous year.

The economies of Central America went from 3.2% growthLATIN in the AMERICA: first three quarters of 2019 to aAND 5.9%LEVEL O GROWTH RATE contraction in the same period of 2020. In(IN thePERCENTAG case of Central America and Mexico, the drop in growth in the first three quarters of 2020 was 9.2%, 9.6 percen4 tage points lower than in the same period of 2019.

2 0 -2 -4 -6

MONITORING MARKET RESEARCH REPORT

71

The negative development of the situation since the BOND YIELDS IN report means publication of the October 2021 WEO SOUTHERN that the global economy COUNTRIES starts the year in weaker conditions than expected. The appearance of the Argentina 7Y 46,144 new Omicron variant led to new mobility restrictions (0,000 (0,00%)) 43.300 - 43.300 and volatility in financial markets at the end of 2021.

50000 Chile 10Y 4,380 Supply disruptions limit trading activity. (+0,000 (+0,00%)) 40000

by the significant decrease in domestic demand in each of its components and by lower external demand. As for aggregate demand, strong falls are observed in all its components: consumption, investment and exports.

In sectoral terms, ECLAC states that although the current situation has had a negative impact on all sectors, it has done so with different intensity depending on the sector. The most affected were the manufacturing industry, construction, commerce and transport, and the least, agriculture, services of an essential nature, financial services and mining.

116.323 - 116.323 30000 Colombia 10Yquarter, 6,990 Supply disruptions continued in the fourth (+0,000 (+0,00%)) sowing manufacturing, 20000 obstacles to international 104.525 - 105.005

particularly in the United States and Europe.

A reMexico 10Y 6,994 10000 (+0,179 (+2,64%)) surgence in COVID cases (particularly in Europe) 107.287 - 107.401 0 has also hampered a broader recovery.

In China, Expiration Annual Peru 10Y 5,407 date disruptions, variation industrial -10000 COVID-induced production (+0,000 (+0,00%)) disruptions caused by blackouts,111.680 falling- 111.871 real estate investment, and an unforeseen acceleration of government investment cuts all contributed to a cooling of the economy in the second half. Despite signs that the global situation turned around in November with a pick-up in international trade and surprisingly favorable data on services activity and industrial production, this is only a partial offset to earlier declines.

Future outlook

From another perspective, growth projections for the economies of Latin America and the Caribbean in 2021 are positive (subject to change due to the current situation). A regional average growth rate of 3.7% is estimated. In fact, 3.1 points of the projected growth rate for the region in 2021 corresponds to statistical carryover, which means that 3.7% would make it possible to recover 44% of the GDP loss recorded in 2020.

The contraction of regional GDP is explained both

LATIN AMERICA: GROWTH RATE AND LEVEL OF GDP, 2018-2020 GROWTH RATE (IN PERCENTAGES) 4 2 0 -2 -4 -6 -8 -10

Mexico and Central America Latin America South America

-12 -14 -16 -18 -20

Trim 1

Trim 2

Trim 3

2018

Trim 4

Trim 1

Trim 2

Trim 3

Trim 4

Trim 1

2019

Source: Economic Commission for Latin America and the Caribbean (ECLAC), based on official figures.

72

Trim 2

2020

GROWTH BY EXPENDITURE COMPONENTS IN LATIN AMERICA Countries

Private consumption

Gross formation of

Total exports 2020

Total imports 2020

(% variation)

capital (2019) % GDP

(Millions of dollars)

(Millions of dollars)

-0.7

19.40%

416.999

382.985

Chile

4

22.44

5.694

59.032

Colombia

7

21.53

31.056

41.185

Argentina

-0.7

14.54

54.884

37.081

3

21.16

46.948

36.285

Guatemala

4.3

14.51

11.513

18.206

Ecuador

-0.6

24.94

20.226

17.959

R.Dominicana

5.3

26

4.511.60

17.087

Panama

2.3

40.41

10.356

15.358

-4.13

17.66

12.173

14.941

Uruguay

0.5

17.18

8.076

7.564

Paraguay

3.9

18.49

11.505

7.294

Bolivia

3.7

19.87

973

7.080

Venezuela

-24.8

21.62

5.020

6.550

El Salvador

1.7

19.1

5.030

1.001

Mexico

Peru

Costa Rica

Source: based on official information. Calculations and graphs made by Latin Press, INC.

In the Economic Survey of Latin America and the Caribbean, 2020, ECLAC projects a scenario in which the region rebounds in 2021 and then returns to its average growth trajectory of the last decade of 1.8%. In this scenario, recovery to the 2019 GDP level would be reached in 2024.

A revised assumption that removes the Build Back Better fiscal policy program from the baseline projection, the anticipated withdrawal to accommodate monetary policy, and continued supply disruptions generated a downward revision of 1.2 percentage points for the United States.

From another angle, the International Monetary Fund projects global growth to moderate from 5.9% in 2021 to 4.4% in 2022; that is, half a percentage point lower in 2022 than projected in the October edition of the World Economic Outlook (WEO report), largely because of a cut in the projections for the two largest economies.

The forecast relies on indicators of poor health status falling to low levels in most countries by the end of 2022, assuming that immunization rates will improve internationally, and more effective therapies will emerge.

The analysis presented by ECLAC at the country leMONITORING MARKET RESEARCH REPORT

73

UPDATE ON THE WORLD ECONOMIC OUTLOOK, JANUARY 2022

GROWTH PROJECTIONS WORLD ECONOMY

ADVANCED ECONOMY

6.5

5.9

5.0

4.4

2021

EMERGING AND DEVELOPING MARKET ECONOMIES

3.9

3.8

2022

2023

2021

4.8

4.7

2022

2023

2.6

2022

2023

2021

Source: International Monetary Fund

vel indicates that Chile and Brazil are the most indebted economies in the region (263% and 229% of GDP for the third quarter of 2020, respectively).

since the start of the pandemic for high yield and investment grade bonds.

Similarly, the World Bank, in the “Global Economic Outlook” report, argues for a more optimistic scenario: “Regional economic activity is expected to grow by 3.7% in 2021, as initiatives to mitigate the pandemic”.

That is why liquidity expansion policies have succeeded in reducing the cost of financing for the nonfinancial corporate sector. The interest rate spread for the corporate sector has narrowed substantially

ANNUAL RATES OF CHANGE AT CONSTANT PRICES (2010) TOTAL GDP GDP PER CAPITA 10

5

Rate of change GDP

Source: Economic Commission for Latin America and the Caribbean (ECLAC)

74

Per capita variation rate

2019

2018

2017

2016

2015

2014

2013

2012

2011

2010

2009

2008

2007

2006

2005

2004

2003

2002

2001

2000

1999

1998

1997

1996

1995

1994

1993

1992

1991

-5

1990

0

ESTIMATES 2020-2021 AND PROJECTIONS 2022 - 2023 Estimates

Projections

Difference with Update of the WEO report of October 2021 1/ 2022 2023 -0.5 0.2 -0.6 0.4 -1.2 0.4 -0.4 0.5 -0.8 0.9 -0.4 0.0 -0.4 0.6 -0.6 1.2 0.1 0.4 -0.3 0.4 -0.8 0.2 -0.1 0.0

2021 5.9 5.0 5.6 5.2 2.7 6.7 6.2 4.9 1.6 7.2 4.7 4.7

2022 4.4 3.9 4.0 3.9 3.8 3.5 3.8 5.8 3.3 4.7 4.1 3.6

2023 3.8 2.6 2.6 2.5 2.5 1.8 2.2 3.8 1.8 2.3 2.8 2.9

-2.0

6.5

4.8

4.7

-0.3

-0.9 -7.3 -3.4

7.2 9.0 3.1

5.9 9.0 5.6

5.8 7.1 6.0

-1.8

6.5

3.5

-2.7 -6.9 -3.9 -8.2 -2.8 -4.1 -1.7 -1.8 -6.4

4.5 6.8 4.7 5.3 4.2 2.9 4.0 3.0 4.6

-3.5

Projections

2021 4.2 4.4 5.3 4.8 1.9 5.0 6.2 4.9 0.4 6.3 3.5 3.8

2022 3.9 3.5 3.5 3.2 4.2 1.9 2.5 5.0 3.6 3.8 3.9 3.4

2023 3.4 1.8 2.0 1.8 1.6 1.7 1.7 2.5 1.1 0.5 1.9 2.5

0.1

4.0

4.3

4.8

-0.4 0.5 -0.2

0.1 0.5 0.0

3.7 4.3 3.5

5.4 5.8 5.6

5.7 7.5 5.9

2.9

-0.1

0.0

5.8

2.2

3.0

2.8 2.4 0.3 2.8 4.3 4.8 3.7 2.7 1.9

2.1 2.6 1.6 2.7 3.6 2.8 4.0 2.7 1.4

-0.1 -0.6 -1.2 -1.2 0.2 0.0 -0.1 0.0 -0.3

0.1 0.1 -0.4 0.5 -0.2 0.0 -0.1 0.1 0.0

4.2 3.7 0.6 2.9 ...

5.2 ...

2.4 1.3

2.1 1.8 1.5 3.4 ...

5.3 ...

2.1 2.6

1.8 2.6 1.4 1.9 ...

2.8 ...

2.3 0.9

5.6

4.2

3.4

-0.5

0.3

4.2

3.9

2.8

0.1

3.1

5.3

5.5

0.0

0.0

...

...

...

Volume of world trade (goods and services) 6/

-8.2

9.3

6.0

4.9

-0.7

0.4

...

...

...

Advanced economies advanced economies Emerging market and developing economies Commodity prices (US$ USA.) Petroleum 7/ Non-combustible (average based on world import weights of raw Materials) Consumer prices Advanced Economies

-9.0

8.3

6.2

4.6

-0.7

0.6

...

...

...

-6.7

11.1

5.7

5.4

-0.7

0.0

...

...

...

-32.7

67.3

11.9

-7.8

13.7

-2.8

79.2

-4.7

-6.8

6.7

26.7

3.1

-1.9

4.0

-0.4

17.2

1.5

-1.6

0.7

3.1

3.9

2.1

1.6

0.2

4.8

2.8

2.0

world product Advanced economies USA Euro zone Germany France Italy Spain Japan United Kingdom Canada Other advanced economies 3/ Asian emerging market and developing economies China India 4/ ASEAN-5 5/ Emerging and developing economies of Europe Russia Latin America and the Caribbean Brazil Mexico Middle East and Central Asia Saudi Arabia sub-saharan africa Nigeria South Africa informative items World growth according to market exchange rates Low-income developing countries

2020 -3.1 -4.5 3.4 -6.4 -4.6 -8.0 -8.9 -10.8 -4.5 -9.4 -5.2 -1.9

Estimates

Note: Real effective exchange rates are assumed to remain constant at current levels between December 10, 2021, and January 7, 2022. Economies are listed based on size. Aggregate quarterly data are seasonally adjusted. WEO Report = World Economic Outlook.1/ Difference based on rounded figures in both the forecasts in this Update and the October 2021 edition of the World Economic Outlook. Countries whose forecast has been revised from the October 2021 WEO correspond to about 90% of annual world output weighted by purchasing power parity.2/ For world output, quarterly estimates and projections correspond to about 90% of annual world output weighted by purchasing power parity.

For emerging market and developing economies, quarterly estimates and projections correspond to about 80% of annual group output weighted by purchasing power parity.3/ Excludes the Group of Seven (Canada, France, Germany, Italy, Japan, United Kingdom, United States and United States) and Eurozone countries.4/ For India, data and forecasts are based on fiscal year, with fiscal year 2021/22 starting in April 2021. In the January 2022 update of the WEO report, India’s growth is projected at 8.7% in 2022 and 6.6% in 2023 on a calendar year basis. The 2021 column of the table includes the impact of the Omicron variant. 5/ Philippines, Indonesia, Malaysia, Thailand, Vietnam.6/ Simple average of export and import volume growth rates (goods and services).7/ Simple average of U.K. Brent, Dubai Fateh and West Texas Intermediate crude oil prices. The average oil price was USD 69.07 in 2021; the assumed price based on futures markets (as of January 10, 2022) is USD 77.31 in 2022 and USD 71.29 in 2023.8/ The inflation rate for the Euro zone is 3.0% in 2022 and 1.7% in 2023, for Japan it is 0.7% in 2022 and 2023, and for the United States it is 5.9% in 2022 and 2.7% in 2023, respectively.9/ Excludes Venezuela.

MONITORING MARKET RESEARCH REPORT

75

GDP GROWTH RATE (2020) AND PROJECTIONS (2021-2022) Countries

December 2020

2021 projections %

2022 projections %

Growth Difference (2020-2021)

Growth Difference (2021-2022)

Paraguay

-0.6

4

4

-85

100

Panama

-17.9

2.6

7.8

788.4

66.66

Brazil

-1.2

3.7

6.5

132.4

43.07

Costa Rica

-4.5

2.9

4

-55.17

27.5

Honduras

-9

4.5

5.2

300

13.46

Uruguay

-5.9

2.7

3.1

318.51

12.9

Guatemala

3.6

3.1

3.4

-16.12

8.82

Dominican Republic

-6.7

4.8

4.5

239.583

-6.66

El Salvador

-7

5

4.4

240

-13.63

Bolivia

-6.2

4.4

3.5

-40.9

-25.71

Colombia

6.1

5.1

3

-19.6

-70

Mexico

3.1

5

2.5

38

-100

Chile

3.2

6.2

3

48.38

-106.6

Peru

0.51

8.5

3.9

94

-117.9

Argentina

-9.9

5.8

2.5

270.68

-132

Ecuador

-7.8

8.8

1.3

11.36

-576.9

Source: based on official information from the region’s central banks. Own calculations and graph.

Note: The difference in growth expressed in percentage units is obtained by estimating the current GDP (projection with the previous GDP).

76

Investment projection of confidence and trade recovery In Central America, growth is expected to recover to 3.6% this year, supported by higher remittance inflows and stronger export demand, as well as reconstruction after two hurricanes. In the Caribbean, growth is expected to rebound to 4.5%, driven by a partial recovery in tourism.

In terms of trade, for 2021, the WTO expects a rebound in trade volume with a growth of 7.2 %, in line with the expected rebound in global economic activity. In this regard, there is the possibility of a somewhat better performance than predicted in the event that vaccines or treatments for COVID-19 could be distributed more quickly.

ECLAC estimates that the economies of the CARD countries will have an average growth of 4.2% in 2021, to the extent that global economic activity recovers and the internal dynamics of consumption and investment are reestablished.

The region’s current account deficit narrowed sharply in 2020, driven by an increase in the current account surplus, by the increase in the goods surplus as a result of a sharp contraction in imports, its decline outpacing that of exports, so the goods account surplus increased in 2020.

Inflation expectations 20212022 ECLAC estimated in 2020 that year-on-year (December - December) average inflation in CARD countries stood at 2.3%, 0.4 percentage points below that recorded in 2019 (2.7%). This slowdown was the result of a significant contraction in domestic demand, which offset supply effects related to the temporary closure of economic activities.

The August 2020 expectations surveys conducted by the region’s Central Banks indicate that the simple average of growth expectations for 2020 decreased 0.1 percentage points from -5.9 % to -6.0 % and

the simple average of inflation expectations increased 0.1 percentage points from 3.1 % to 3.2 % with respect to the July surveys. Changes in both inflation and growth expectations are heterogeneous among the countries analyzed.

In the case of expectations for 2021, the August 2020 surveys indicate that the simple average of growth expectations increased 0.1 percentage points from 3.8 % to 3.9 % and the simple average of inflation decreased 0.1 percentage points from 3.8 % to 3.7 % with respect to the July surveys.

The countries where growth expectations for 2021 increased were Brazil, Mexico, Paraguay and Peru.

In the case of inflation, Brazil, Paraguay and Uruguay recorded a drop in inflation expectations.

High inflation is expected to continue higher than anticipated in the October edition, and supply chain disruptions and high energy prices are expected to persist in 2022. Inflation is forecast to remain elevated in the near term, averaging 3.9% in advanced economies and 5.9% in emerging market and developing economies in 2022, before falling back in 2023.

Future markets indicate that oil prices will rise by about 12% and natural gas prices by about 58% in 2022 (both increases being considerably lower than those recorded in 2021), before falling back in 2023 as supply-demand imbalances are further corrected.

Similarly, food prices are projected to advance at a more moderate pace of about 4½% in 2022 and reverse in 2023.

In many countries, nominal wage growth remains subdued, even though employment and participation have nearly recovered to pre-pandemic levels).

In the United States, however, the situation is different: the dramatic fall in unemployment is accompanied by a vigorous rise in nominal wages. This suggests a degree of saturation of U.S. labor markets not seen elsewhere. If U.S. labor force participation remains below pre-pandemic levels and discouraged workers remain unemployed, tighter labor markets could translate into rising prices.

Consequently, in December 2021, the Federal Reserve announced that it would accelerate the graMONITORING MARKET RESEARCH REPORT

77

dual tapering of asset purchases and implied that the federal funds rate would likely increase to 0.751.00% by the end of 2022; or about 50 basis points higher than previously suggested.

Impact on the level of investment and capital flows in the security monitoring systems market.

In 2020, sales of video surveillance equipment grew slowly. However, this growth was driven by the explosive demand for thermal cameras to help control the pandemic. At the same time, the acquisition of monitoring equipment such as alarms and cameras for fire detection in different sectors, evidenced the increasing migration to different sectors such as corporate and residential.

According to the latest data from research firm Omdia, sales in security systems only grew by 2.2 % given the accelerated demand for thermal solutions that were implemented to monitor symptoms of suffering from COVID-19 disease. This segment increased its sales to $1.3 trillion and, without its contribution to the overall figures, the video surveillance market declined by 3.8 % compared to 2019. Looking ahead to this year, sales of thermal systems are expected to decline 89.8 %, limiting overall growth prospects.

78

Among expert forecasts, it was stated that the economic revival would allow the market to grow to about $24 trillion by the end of 2021. According to the researchers, “It will continue to do so at a compound annual rate of 7.1% between 2020 and 2025, and could reach some $31.9 trillion by the end of the period”.

It should be noted that in terms of investment levels, countries such as China will moderate investment in video surveillance systems, due to the end of the Xue Liang program, whose investments have allowed it to increase its spending on these technologies last year by 6.4%, accounting for 50% of the total. However, Chinese authorities and companies are expected to continue to make a decisive contribution to the global market.

Furthermore, Markets and Markets forecasts the global market size for fire protection systems to increase from US$ 62.1 trillion in 2021 to US$ 84.6 trillion by 2026, at a compound annual growth rate of 6.4 %. According to official sources, these market figures are driven by growth in the construction industry, stringent regulations, and increasing adoption of wireless technology in fire detection.

Globally, it has been growing persistently; in 2019, global revenues totaled $220.2 trillion and Latin America generated 6 % of these revenues. According to projections by Freedonia Group, global revenue from security services will grow by 3.6 % annually until 2024, when it will reach $263 trillion.

EXPORT GROWTH AND TRADE BALANCE IN MEXICO AND CENTRAL AMERICA 2020 - 2021 % EXPORT GROWTH 2020 - 2021

2,24% -9,04%

-55,0%

-8,55%

Nicaragua

-22,58%

El Salvador

-4,49%

-9,45%

Fuente: Cepal

TRADE BALANCE 2020* Mexico 24.422

(Surplus)

Costa Rica 2.768 (Deficit)

Guatemala 6.637 (Deficit)

Honduras 2.138 (Deficit)

Nicaragua 1.521 (Deficit)

Panama 5.002 (Deficit)

El Salvador 5.563 (Deficit)

In US Dollars. *Estimate by ECLAC * Note: latest available data (2020 - 2021).

MONITORING MARKET RESEARCH REPORT

79

Mexico, Central America and the Caribbean

MEXICO: GDP AND UNEMPLOYMENT, 2018-2020

México The Mexican economy will plummet by -10.2% in 2020, according to the results of the survey conducted in August 2020 by the Bank of Mexico among 36 specialists from the private and foreign sectors, coinciding with ECLAC’s estimates of a -9.0% decrease, the largest contraction of the country’s economic activity since 1932.

6

4 2

5

0 -2

4

-4 -6

3

-8 -10

2

-12

ECLAC estimated that inflation in 2020 would be 3.5%, due to the increase in the price of agricultural products, medical supplies, medicines, gasoline and public services, as well as the exchange rate depreciation. For its part, the unemployment rate would be at 5.1%, with a loss, between January and October 2020, of 518,609 formal jobs registered in the Mexican Social Security Institute (IMSS), compared to 2019.

From January to October 2020, the values of total merchandise exports and imports fell 12.6% and 18.8%, respectively, although the Organization for Economic Cooperation and Development (OECD) notes that exports have revived, driven by the reMEXICO: GDP AND bound in the US.

UNEMPLOYMENT, 2018-2020

ECLAC forecasts a 3.8% growth in Mexico’s GDP 4 6 for 2 2021.

For its part, the OECD forecasts GDP growth 5 at0 3.6%.

-14

1

-16 -18 -20

T1

T2 T3 2018

T4

T1

T2 T3 2019

T4

T1

T2 2020

T3

INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

IMPORTS OF EQUIPMENT ALARMS, FIRE DETECTION AND VIDEO SURVEILLANCE

4

2019

2020

In the case of investment, Mexico’s attraction to caGDP, VARIATION RATE OVER 4 QUARTERS. pital flows has been maintained, with US$11.864 triINFLATION, VARIATION RATE OVER 12 MONTHS. llion in net FDI inflows in the first quarter of 2021, an UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. increase of 14.8% and the highest amount for a first quarter.

Source: ECLAC, based on official data

80

34.6% CHINA

7.5% JAPAN

28.9% USA

7.5% GERMANY

15.3% OTHERS (KOREA. TAIWAN. CANADA AND MALAYSIA)

6.2% MEXICO

TO OCTOBER 2021

Source: Descartes Datamyne – Inegi.

T

Sou

The Bank of Mexico made the projection for 2022, -6 -8 from 3.3% to 3%. Regarding consumer confidence, 3 -10 according to seasonally adjusted figures from the 2 -12 National Institute of Statistics and Geography (Ine-14 gi), -16 the Consumer Confidence Indicator (ICC) advan1 ced 11.5 points in its annual comparison, reaching a -18 -20 0 level of 42.7 points.

T1 T2 T3 T4 T1 T2 T3 T4 T1 T2 T3 2018

0

GDP, VARIATION RATE OVER 4 QUARTERS.

-2 -4

IM FIR SU

Costa Rica

COSTA RICA: GDP AND UNEMPLOYMENT, 2018-2020

By 2020, the Costa Rican economy had a contraction of -4.8% of GDP due to the imposition of physical distancing measures and mobility restrictions due to the pandemic, and the fall in international trade of goods and services, according to ECLAC. This drop was the second largest contraction in economic activity since 1950, after the -7.3% decline recorded in 1982.

In this regard, the OECD notes that employment in the country is beginning to recover and the unemployment rate has fallen slightly from 24.4% in July to 23.2% in August. Labor-intensive service sectors, such as hospitality, retail, transportation services, domestic services and construction, are the most affected by the pandemic.

The agency forecasts a GDP recovery of 2% by 2021 and a stronger recovery (3.8%) by 2022. For its part, ECLAC estimates a 3.0% growth in 2021.

On the other hand, the Central Bank of Costa Rica (BCCR) highlights an improvement in the macroecoCOSTA RICA: GDP AND nomic scenario that is reflected in various indicators UNEMPLOYMENT, 2018-2020 for the end of the year and for 2022 forecasts. It also emphasizes that the evolution of the main indicators 5 24 of4 the external sector would be conditioned by the 22 3 recovery of the local economic activity and of 2 20 the 1 18 main commercial partners.

0 -1 -2 -3 -4 -5 -6 -7 -8 -9 -10

5 4 3 2 1 0 -1 -2 -3 -4 -5 -6 -7 -8 -9 -10

T1

T2

T3 2018

T4

T1

T2

T3 2019

T4

T1

T2

T3

IM FIR SU 24 22 20 18 16 14 12 10 8 4 4 2 0

2020

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

Sour

IMPORTS OF EQUIPMENT ALARMS, FIRE DETECTION AND VIDEO SURVEILLANCE

16 14 Consumer confidence was severely affected. Howe12 10 ver, for 2021, the Central Bank projects a gradual 8 recovery of domestic demand, mainly driven by 4 the vaccination campaign and the possibility4 of a return to normality. Domestic demand is expected 2 0 for to recover, with a growth of 2.4%, on average, T1

T2

T3

2021-2022.

2018

T4

T1

T2

T3

2019

T4

T1

T2

T3

2020

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

TO

46.6% USA

5.1% HONG KONG

24.5% CHINA

4.9% PANAMA

TO OCTOBER 2021

Source: Descartes Datamyne - National Customs Service.

MONITORING MARKET RESEARCH REPORT

81

El Salvador

EL SALVADOR: GDP AND INFLATION, 2018-2020

In 2020, El Salvador’s GDP contracted by -8.6% (versus a 2.4% expansion in 2019), due to the temporary cessation of economic activity due to the COVID-19 pandemic, according to ECLAC. This would be the third steepest decline in output since 1950, after -11.8% in 1980 and -10.5% in 1981, the years of the beginning of the civil war.

The Central Reserve Bank of El Salvador indicated in September 2020 that during the first six months of the year “a contraction of -9.3% of the GDP is reflected, which did not have a greater dimension thanks to the implementation of policies aimed at supporting the income and consumption of households through cash transfers and food packages”.

The country also presented a strong increase in unemployment, with the loss of some 60,000 jobs, according to data from the Ministry of Economy, raising to 8.24% the unemployment rate which had been at 6.3%.

EL SALVADOR: GDP AND

As INFLATION, for international 2018-2020 trade, between January and October 2020, exports amounted to 4.087 billion dollars, with a contraction of 18.8% year-on-year, 3 4 while accumulated imports amounted to 8.514 bi2 2 llion0 dollars, representing a year-on-year reduction -2 of 15.7%.

1 -4

IMPO FIRE SURV 3

4 2

2

0 -2

1

-4 -6 -8

0

-10 -12 -14

-1 -2

-16 -18 -20

T1

T2 T3 2018

T4

T1

T2 T3 2019

T4

T1

T2 2020

T3

-3

24.4%

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

IMPORTS OF EQUIPMENT ALARMS, FIRE DETECTION AND VIDEO SURVEILLANCE

-6

-3

-20

INFLATION, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

82

24.5% OTHERS( HONG KONG. GUATEMALA. NICARAGUA.SPAIN) 24.4% USA 16.8% PANAMA TO DECEMBER 2020

Source: ITC - Central Reserve Bank of El Salvador.

16.8%

TO DECE

Source: I

0 -8 ECLAC expects the Salvadoran economy to recover -10 by-12 3.5 % in 2021, driven by an increase in public -1 and -14 private investment, private consumption and the ex-2 -16 ternal sector.

Inflation will be close to 1%.

-18 T1 T2 T3 T4 T2 T3 T4 T1 T2 T3 According to Ipsos, aT1global market research com2018 2019 2020 pany, on the Consumer Confidence Index (ICC), “El Salvador registered an important improvement of +18.0 GDP, points, reaching 57.3.

VARIATION RATE OVER 4 QUARTERS.

24.5%

16.8% CHINA 7.2% COSTA RICA 5.7% NICARAGUA 4.6% KOREA

Guatemala

GUATEMALA: GDP AND INFLATION, 2018-2020

ECLAC estimates that in 2020 Guatemala’s GDP will have contracted -2.5%, compared to the 3.8% growth presented in 2019, caused by the confinement measures to face the pandemic, although it estimates a 3.5% rebound by 2021.

Significant efforts by the Guatemalan government to offer fiscal stimuli to companies, the creation or increase of social programs aimed at families and the reduction of tax revenues led the country to end 2020 with a deficit of 5.3% of GDP, but an external debt of 31.6%, the lowest in the region.

However, inflation stood at 5.46%, almost five tenths above the upper limit of the central bank’s target range (between 3% and 5%).

From January to October 2020, the value of total exports of goods decreased at a year-on-year rate of 0.1%, while that of imports fell by 11.1%. Imports of consumer goods decreased by 8% during the first eight months of the yearGDP and those of capital goods GUATEMALA: AND byINFLATION, 7.2%.

2018-2020 On the other hand, regarding the consumer confi6 dence index, for this 2021 Guatemala registered an 6 improvement of +7.6 points, reaching 43.9.

5

IM FI SU

6

6 5

5

4

4

3

3

2

2

1 0

1 T1

T2 T3 2018

T4

T1

T2 T3 2019

T4

T1

T2 2020

T3

0

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

Sou

IMPORTS OF EQUIPMENT ALARMS, FIRE DETECTION AND VIDEO SURVEILLANCE

5

4

In the Investment Index, an improvement of 4+3.9 points was registered, which allows it to remain in 3 3 the top third together with El Salvador (61.6), the 2 2 United States (50.2) and Puerto Rico (49.2).

1 0

1 T1

T2 T3 2018

T4

T1

T2 T3 2019

T4

T1

T2 2020

T3

0

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

T

32.0% USA

5.8% OTHERS

22.7% CHINESE TAIPER

5.3% MEXICO

13.3% CHINA

4.0% ISRAEL

13.1% HONG KONG

3.8% PANAMA

TO DECEMBER 2020

Source: (ITC) - Central Bank of Guatemala.

MONITORING MARKET RESEARCH REPORT

83

Panama

PANAMA: GDP, INFLATION AND UNEMPLOYMENT, 2018-2020 3

5

Despite the fact that the World Bank highlighted in 2019 that “Panama has been one of the fastest growing economies worldwide”, with an average of 5% in the last five years, the pandemic collapsed the positive outlook and ECLAC estimates a contraction of -11.0% for 2020, which represents the setback of a decade for the Panamanian economy.

ECLAC estimates that inflation would again be in negative territory, with a decrease of 1.0% in 2020 and 0.1% in 2019), due to weak demand, while the unemployment rate would exceed 10% at the end of the year compared to 5.8% in 2019.

0

2

-5 1

-10 -15

0

-20 -1

-25 -30

-2

-35 -40

T1

T2

T3

T4

T1

T2

T3

T4

T1

T2

T3

-3

2020

24

GDP, VARIATION RATE OVER 4 QUARTERS.

23

INFLATION, VARIATION RATE OVER 12 MONTHS.

16

2018

2019

UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS.

In terms of international trade, between January and August 2020, the value of total exports of goods fell by 23.7% compared to 2019, while imports of goods into the country (excluding the Colon Free Zone) fell by 41.2%.

The largest contraction corresponds to imports of GDP, INFLATION AND capitalPANAMA: goods (52.7%), although imports of consuUNEMPLOYMENT, 2018-2020 mer goods and intermediate goods also recorded 3 5 significant drops in the period (39.1% and 32.4%, 0 respectively).

The same agency projects that the Pa2 -5 namanian economy will recover 5.5% in 2021.

Source: ECLAC, based on official data

IMPORTS OF EQUIPMENT ALARMS, FIRE DETECTION AND VIDEO SURVEILLANCE

1

-10

The Panamanian Consumer Confidence Index (ICCP), -15 0 in charge of the pollster The Marketing Group, ac-20 cording to last May’s measurement, reached 105 -1 -25 points, 5 units higher than the previous one, of -30 -2 March 2021, informed the Chamber of Commerce, -35 Industries and Agriculture of Panama (CCIAP).

-40

T1

T2

T3

2018

T4

T1

T2

T3

2019

T4

T1

T2

T3

-3

2020

23.3% CHINA

INFLATION, VARIATION RATE OVER 12 MONTHS.

16.1% GERMANY

Source: ECLAC, based on official data

84

24.7% USA

GDP, VARIATION RATE OVER 4 QUARTERS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS.

IMPO FIRE SUR

9.1% BRAZIL 10.8% OTHERS (PERU. COSTA RICA.TAIWAN.HONG KONG) 8.1% MEXICO 7.9% COLOMBIA ZONE

TO OCTOBER 2021

Source: Descartes Datamyne - National Customs Authority.

TO O

Source:

Honduras

HONDURAS: GDP AND INFLATION 2018-2020

The COVID-19 pandemic significantly affected the economy of Honduras. The country’s GDP was expected to contract by 9 % in 2020 due to the pandemic and the two successive hurricanes. Some 45 % of households, according to World Bank surveys, reported income losses in August.

5

6

4 2 2

5

-2

IMPO FIRE SUR

4

-4 -6

3

-8 -10

2

-12 -14

Projections suggest that the proportion of people living below the $5.50 a day poverty line could rise to 55.4 percent in 2020, resulting in more than 700,000 new poor, while inequality increases slightly.

1

-16 -18 -20

T1

T2

T3

2018

T4

T1

T2

T3

T4

2019

T1

T2

T3

0

2020

6

1

From another angle, Honduras’ economy is expected to rebound in 2021 to 4.5 percent growth, amid the revival of domestic economic activity and the recovery of investment and external demand.

Around trade from January to September 2020, exports of Honduran companies amounted to $3,262 million, an amount that exceeds by 0.3% what was reported in the same period of 2019, a rise that is HONDURAS: GDP AND recorded after several drops in sales, which were geINFLATION 2018-2020 nerated by the health and economic crisis.

5

6

GDP, VARIATION RATE OVER 4 QUARTERS.

TO OC

INFLATION, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

Source:

IMPORTS OF EQUIPMENT ALARMS, FIRE DETECTION AND VIDEO SURVEILLANCE

4 2 2

During the third quarter of 2020, Honduras received 5 323.5 million dollars of Foreign Direct Investment -2 (FDI), -475.9 percent higher than the same period4 of 2019. -6 For this 2021, growth is associated with the 3 -8 maquila, agriculture, and construction sectors.

-10 2

-12 -14

1

-16 -18 -20

T1

T2

T3

2018

T4

T1

T2

T3

2019

T4

T1

T2

T3

0

2020

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

67,0% CHINA

9,9% USA

15,8% OTHERS (TAIWAN. JAPAN. MEXICO. THAILAND. GERMANY. SPAIN. COLOMBIA)

7,3% MALAYSIA

TO OCTOBER 31 2021. * LATEST DATA AVAILABLE.

Source: Descartes Datamyne - (INE)

MONITORING MARKET RESEARCH REPORT

85

Dominican Republic

DOMINICAN REP: GDP, INFLATION AND UNEMPLOYMENT, 2018-2020

After a negative year-end of -6.7% of its gross domestic product (GDP) in 2020, the economy of the Dominican Republic will reach a growth of 4.8% in 2021 and 4.5% in 2022, well above the projected growth for the region of 3.7% for this year and of most Latin American countries.

Until the end of September, the Dominican economy had fallen by around 8%, especially due to the collapse of tourism, the country’s main economic sector. The rest of the sectors have been returning to economic recovery.

In the case of foreign trade, total exports of goods as of March 2021 reached some US 2,89 billion, which represented a growth of 7.5% with respect to January-March 2020, or an additional US$203.1 million.

For 2021 imports show a marked inter-annual growth of 27.4% in the month of March, highlighting DOMINICAN REP: GDP, INFLATION non-oil imports with an increase of 19.4%, which is UNEMPLOYMENT, 2018-2020 in line AND with the reactivation of economic activity. In 10 8 the January-March quarter, total imports grew 9.9% 8 7 compared to the same period of the previous year.

6 4 2 0 -2 -4 -6 -8 -10 -12 -14 -16 -18 -20

10 8 6 4 2 0 -2 -4 -6 -8 -10 -12 -14 -16 -18 -20

8 7 6 5 4 3 2 1 T1

T2

T3

T4

T1

T2

T3

T4

T1

T2

T3

3

GDP, VARIATION RATE OVER 4 QUARTERS.

2

INFLATION, VARIATION RATE OVER 12 MONTHS.

1

2019

UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

IMPORTS OF EQUIPMENT ALARMS, FIRE DETECTION AND VIDEO SURVEILLANCE

0

Source: ECLAC, based on official data

86

37.7% CHINA 27.1% OTHERS( JAPAN. LATVIA.BRAZIL ) 15.9% USA

TO DE

Source:

6

UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS.

0

2020

2018

Likewise, foreign investment grew by 4% up to Sep5 tember, totaling US 2,066 billion for the year, and 4 remittances grew by 34%. However, inflation, which 3 accumulated an increase of 3.74%, will maintain the target set by the Central Bank of 4% with a range2 of one point of oscillation in both directions.

1 T2 consumer T3 T4 T1 confidence T2 T3 T4 index, T1 T2 the T3 DoRegardingT1 the 2018 2019 2020 minican Republic registered an improvement of +1.5 GDP, VARIATION RATE OVER 4 QUARTERS. points, reaching 35.1. The investment index showed INFLATION, RATE OVER 12 MONTHS. an improvement of VARIATION +1.2 points.

IMPO FIRE SUR

10,3% KOREA 8,9% MEXICO

TO DECEMBER DE 2020

Source: (ITC) - National Statistics Office, Dominican Republic.

EXPORTS AND TRADE BALANCE IN THE ANDEAN REGION AND THE SOUTHERN CONE 2020 - 2021 % EXPORT GROWTH 2020 - 2021

23,10%

Venezuela

-4,60%

TRADE BALANCE 2020 - 2021 Bolivia 64.800 (Deficit)

Colombia

Colombia 12.481 (Deficit)

2,29%

Ecuador

Ecuador 2.267 (Surplus) 3,02%

3,07%

Peru

Peru 6.314 (Surplus) Venezuela 1. 530 (Deficit)

0,18%

Bolivia

Brazil 43.602 (Surplus)

5,02% Chile

Source: IADB and ECLAC

3,22%

Argentina

Argentina 12. 530 (Surplus) Chile 12.695 (Surplus) In US Dollars *Estimation by ECLAC

MONITORING MARKET RESEARCH REPORT

87

Andean region

Bolivia

BOLIVIA: GDP, INFLATION AND UNEMPLOYMENT, 2018-2020

Health measures to contain COVID-19 infections led to an economic crisis that caused the Bolivian economy to contract by -8.0% in 2020, with a significant increase in the unemployment rate and moderate inflation of 1.5%, ECLAC revealed.

In addition to tax deferrals (representing 1.5% of GDP), measures to address the economic crisis include transfers to different segments of the population (1.7% of GDP), credit to companies and support for employment (1.2% of GDP), as well as discounts on basic services (0.3% of GDP).

The outlook for ECLAC shows that “extreme poverty will reach 16.8% this year, with a greater increase in unemployment, causing a significant deterioration in the levels of poverty and inequality”, warned Alicia Bárcena, Executive Secretary of the organization, at the end of 2020.

The National Statistics Institute (INE) reported that, at the BOLIVIA: end of the third quarter of 2020, theAND unemGDP, INFLATION ployment rate was 10.76%, and although it dropped UNEMPLOYMENT, 2018-2020 to 8.39% in the fourth quarter, by January 2021 it would have risen again to 9.67%. However, ECLAC 6 6 is also optimistic for 2021, forecasting a slight recovery of 2economic activity, with growth of around5 3%, indicating that it will be limited by the “weakness -2 4 of external demand”.

-6

6

6

5

2 -2

4

-6

3

-10

2 -14

1

-18 -20

T1

T2 T3 2018

T4

T1

T2

T3 2019

T4

T1

T3 T2 2020

0

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

IMPORTS OF EQUIPMENT ALARMS, FIRE DETECTION AND VIDEO SURVEILLANCE

3

In the first four months of 2021, imports this 2year -14 reached a value of 2,643 million dollars, an increase 1 of 361-18million (16%) over the same period of 2020.

T1

T2 T3 2018

T4

T1

T2

T3 2019

T4

T1

T3 T2 2020

0

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

88

25.9% CHINA 15.8% OTHERS (TAIWAN, JAPAN, MEXICO, THAILAND, GERMANY, SPAIN, COLOMBIA) 14.5% CANADA 13.8% MEXICO TO JULY 2021

Fuente: ITC - Pro-Bolivia

25

15

14

13

TO JU

Fuente:

-10

-20

IMPO FIRE SUR

11.5% USA 10.4% BRAZIL 8.8% JAPAN 7.8% MALAYSIA 7.4% CHINESE TAIPER

Colombia

COLOMBIA: GDP, INFLATION AND IMPO FIRE UNEMPLOYMENT, 2018-2020

The Colombian GDP will have decreased -7.0% in 2020, according to ECLAC, added to the strong increase in unemployment and sovereign debt, reaching historic highs, which according to the Ministry of Finance, even reached 65.7% of the GDP, in order to meet the needs due to the coronavirus emergency, leaving Colombia among the “most indebted” countries in the region.

However, according to export information processed by DANE and DIAN, in April 2021 the country’s external sales were US$2,914.7 billion FOB and presented an increase of 56.3 % in relation to April 2020; this result was mainly due to the 63.4% growth in external sales of the group of fuels and products of extractive industries.

In the case of imports registered before the DIAN in March 2021, imports were US$4,934.8 million CIF and presented an increase of 37.5% in relation to the same month of 2020.

According to the April results the Consumer OpiCOLOMBIA: GDP,ofINFLATION AND nion Survey (EOC), the Consumer Confidence Index UNEMPLOYMENT, 2018-2020 registered a balance of -34.3%.

SUR

4

20

2

18

0

16

-2

14

-4

12

-6

10

-8

8

-10 -12

6

-14

4

-16

2

-18

T1

T2 T3 2018

T4

T1

T2 T3 2019

T4

T1

T2 2020

T3

0

66.

18.

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

Fuente:

IMPORTS OF EQUIPMENT ALARMS, FIRE DETECTION AND VIDEO SURVEILLANCE

20

4

Foreign investment in Colombia grew 66% in18the 2 0 first quarter of 2021. According to the entity, 16bet-2 14 ween January and March 2021, Colombia received -4 12 33 new projects with estimated business for 1,595 -6 10 million -8 dollars, while last year in the same period it 8 -10 was 960 million dollars.

-12

6

-14

4

Both-16the IMF and ECLAC are optimistic about2 the recovery for 2021, expecting GDP to rebound -18 0 to T1 T2 T3 T4 T1 T2 T3 T4 T1 T2 T3 3.7% and 5.0% respectively.

2018 2019 2020 GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

66.8% CHINA

TO SEP

14.6% USA

18.6% OTHERS (MEXICO. TAIWAN. JAPAN. BRAZIL. THAILAND. ISRAEL. KOREA. VIETNAM) TO SEPTEMBER 2021

Fuente: Descartes Datamyne - DIAN.

MONITORING MARKET RESEARCH REPORT

89

Ecuador

ECUADOR: GDP, INFLATION AND UNEMPLOYMENT, 2018-2020

ECLAC estimates a sharp contraction of the Ecuadorian GDP of -9.0% in 2020, in an economy that had already been showing weak growth in 2019, of only 0.1%, partly as a consequence of the social uprising of October of that year, which left losses of USD 2.8 billion according to the unions, although the Central Bank of Ecuador indicated that this figure would be around USD 821 million.

The Central Bank of Ecuador estimates that by 2021 the economy will recover and grow 3.1%, equivalent to a Gross Domestic Product (GDP) of US$ 67,539 billion in constant values.

Regarding foreign trade, for 2021, non-oil exports are projected to grow between 4% and 5 %. On the other hand, imports of goods and services would grow by 3.2% compared to 2020, a percentage that corresponds to USD 936.6 million.

Regarding the ICC, the outlook is not so encouraging,ECUADOR: since it worsened compared to the same GDP, INFLATION AND month of 2020: it went from 37.10 points to 31.19 UNEMPLOYMENT, 2018-2020 points. On the other hand, the labor market continued to5 deteriorate between September 20195 and September 2020, with an increase of 28% in unem3 4 1 ployment and 11.6 % in underemployment in 2020.

3 Among-1 Latin American countries, ECLAC maintains -3 a very moderate growth forecast for 2021, only21%.

-5

-9

3

4

1

3

-1 -3

2

-5

1

-7 -9

0

-11

-1

-13 -15

T1

T2

T3

T4

2018

T1

T2

T3

T4

2019

T1

T2

T3

-2

2020

16

INFLATION, VARIATION RATE OVER 12 MONTHS.

12

UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

T1

T2

T3

T4

T1

T2

T3

T4

T1

T2

T3

IMPORTS OF EQUIPMENT ALARMS, FIRE DETECTION AND VIDEO SURVEILLANCE

-2 39.0% CHINA

12.4% JAPAN

GDP, VARIATION RATE OVER 4 QUARTERS.

16.4% USA

INFLATION, VARIATION RATE OVER 12 MONTHS.

12.7% TAIWAN

12.1% OTHERS (COLOMBIA, BRAZIL, INDIA, MEXICO, SPAIN)

2018

2019

2020

UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

TO OCTOBER 2021

TO OC

Fuente:

-1

-13

39

GDP, VARIATION RATE OVER 4 QUARTERS.

0

-11

90

5

1

-7

-15

5

IMPO FIRE SUR

7.4% KOREA

Fuente: Descartes Datamyne – Servicio Nacional de Aduana.

Peru

PERU: GDP, INFLATION AND UNEMPLOYMENT, 2018-2020

ECLAC estimates a sharp contraction of the Ecuadorian GDP of -9.0% in 2020, in an economy that had already been showing weak growth in 2019, of only 0.1%, partly as a consequence of the social uprising of October of that year, which left losses of USD 2.8 billion according to the unions, although the Central Bank of Ecuador indicated that this figure would be around USD 821 million.

10

4 1

8

-2 -5 -8

6

-11 -14

4

-17 -20 -23

2

-26

The Central Bank of Ecuador estimates that by 2021 the economy will recover and grow 3.1%, equivalent to a Gross Domestic Product (GDP) of US$ 67,539 billion in constant values.

Regarding foreign trade, for 2021, non-oil exports are projected to grow between 4% and 5 %. On the other hand, imports of goods and services would grow by 3.2% compared to 2020, a percentage that corresponds to USD 936.6 million.

Regarding the ICC, the outlook is not so encouraging, since itGDP, worsened compared to the same PERU: INFLATION AND month of 2020: it went from 37.10 points to 31.19 UNEMPLOYMENT, 2018-2020 points. On the other hand, the labor market continued to deteriorate between September 2019 10and 4 September 2020, with an increase of 28% in unem1 8 ployment and 11.6 % in underemployment in 2020.

-2 -5 Among Latin American countries, ECLAC maintains -8 6 a very -11moderate growth forecast for 2021, only 1%.

IMPO FIRE SUR

-29 -32

T1

T2

T3

2018

T4

T1

T2

T3

2019

T4

T1

T2

T3

0

50

2020

13

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS.

8

UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

Source:

IMPORTS OF EQUIPMENT ALARMS, FIRE DETECTION AND VIDEO SURVEILLANCE

-14

4

-17 -20 -23

2

-26 -29 -32

T1

T2

T3

2018

T4

T1

T2

T3

2019

T4

T1

T2

T3

0

2020

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

50.9% CHINA

8.0% JAPAN

13.1% OTHERS (TAILANDIA, SOUTH KOREA, SPAIN , MEXICO)

7.5% EEUU

8.9% TAIWAN

TO OC

6.6% INDIA 5.0% BRAZIL

TO OCTOBER 2021

Source: Descartes Datamyne – Sunat.

MONITORING MARKET RESEARCH REPORT

91

Southern Cone

Argentina The Argentine economy had been in recession since before the arrival of COVID-19, with a fall in GDP of -3%, aggravated by the pandemic, leading to a contraction of -11.8% by 2020, according to ECLAC, and although both this organization and the OECD anticipate a moderate recovery of between 3.7% and 4.9% between 2021 and 2022.

Despite the above, there were negative effects on private consumption (-14.5%), exports (-8.7%) and public consumption (-5.5%), although this dynamic was also offset by the -23% drop in imports.

For 2021, the Consumer Confidence Index at national level increased 0.3% with respect to April’s record and accumulated a contraction of 7.8% in the inter-annual comparison.

On the other hand, inflation reached 43.5% yearon-year in the accumulated to October, compared to the 2019 average (53.5%), associated with the ARGENTINA: GDP, prices.

INFLATION freezing of regulated product Unemployment rose to 13.1% in the second quarter AND UNEMPLOYMENT, of 2020, although ECLAC expects this indicator to improve 2018-2020 in 2021.6 55 4 2

55

4 2

50 40 35

-4 -6 -8

30 25

-10 -12 -14

20 15 10 5

-16 -18 -20

T1

T2 T3 2018

T4

T1

T2 T3 2019

T4

T1

T2 2020

T3

INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

IMPORTS OF EQUIPMENT ALARMS, FIRE DETECTION AND VIDEO SURVEILLANCE

30 25 20 15 10 5

-16 -18 T1

T2 T3 2018

T4

T1

T2 T3 2019

T4

T1

T2 2020

T3

0

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

29.5% 19.5% 19.0% 9.8% 6.9%

BRAZIL VIETNAM CHINA BELGIUM OTHERS

TO D

Fuente

35

-14

0

GDP, VARIATION RATE OVER 4 QUARTERS.

40

-10 -12

IMP FIRE SUR

45

0 -2

45

-4 -6 -8

92

6

50

0 -2

-20

ARGENTINA: GDP, INFLATION AND UNEMPLOYMENT, 2018-2020

5.9% 4.2% 2.1% 1.5% 1.5%

ROMANIA THAILAND MEXICO CANADA USA

TO DECEMBER 2020

Fuente: (ITC) - National Institute of Statistics and Censuses

Chile In 2020, Chile faced one of the worst economic crises in its history since 1982, with a contraction of the economy of -6.0%, which began with the social crisis experienced in the country in the last quarter of 2019 and which worsened due to border closures, quarantines and the suspension of many economic activities to control the advance of COVID-19, leading to a fall in domestic demand, a lower level of production and increased unemployment.

CHILE: GDP, INFLATION AND UNEMPLOYMENT, 2018-2020 7 5 3 1 -1 -3 -5 -7 -9 -11 -13

Although initially agencies such as the IMF and ECLAC estimated contractions of -7.9%, as of the fourth quarter an incipient recovery of activity is observed due to the gradual withdrawal of sanitary measures and as an effect of economic measures, allowing a slight recovery at the end of the year, and ECLAC and OECD now estimate a GDP recovery of between 4.2% and 5% for 2021.

According to figures from the Foreign Trade Report prepared by the Studies Department of the National CHILE: GDP, INFLATION Customs Service, between January and April 2021 UNEMPLOYMENT, there AND were again encouraging figures for foreign trade,2018-2020 with Chile’s trade exchange with the world 7 14 growing by 25.6% to USD 51,2 billion.

-15

T1

T2

T3

T4

2018

T1

T2

T3

T4

2019

T1

T2

T3

IMPO FIRE SURV

14 13 12 11 10 9 8 7 6 5 4 3 2 1 0

62

2020

27

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

Fuente: D

IMPORTS OF EQUIPMENT ALARMS, FIRE DETECTION AND VIDEO SURVEILLANCE

13 12 3 11 For this same period, the country’s exports reached 1 10 USD 28,7 billion, with an increase of 21.4% in9rela-1 8 tion to -3 the same period of 2020. Imports, meanwhi7 -5 le, totaled USD 24,3 billion, an increase of 32.1%.

6 -7 5 4 -9 The Faculty of Economics and Business of the Univer3 -11 2 sidad-13del Desarrollo (UDD) together with AMCHAM, 1 presented the second version of the Foreign Direct -15 0 5

T3 T1 T2 T3 T4 T1 T2 T3 T4 T1 T2 Investment Confidence Index in Chile, with the par2018 2019 2020 ticipation of 190 companies from different countries GDP, VARIATION RATE OVER 4 QUARTERS. of origin and economic sectors, equivalent to 55% INFLATION, VARIATION RATE OVER 12 MONTHS. of the foreign direct investment that arrives in the country. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS.

Source: ECLAC, based on official data

62.7% CHINA

TO DEC

9.9% USA

27.4% OTHERS( BOLIVIA, SPAIN, TAIWAN, PARAGUAY, MEXICO, ISRAEL, GERMANY

TO DECEMBER DE 2020

Fuente: Descartes Datamyne - National Customs Service.

MONITORING MARKET RESEARCH REPORT

93

Uruguay Although the Uruguayan country did not have a contraction in its GDP as strongly as other countries in the region, ECLAC estimated that there was a decrease of -4.5% in 2020 and projects a recovery of 4.3% for 2021.

Foreign trade was one of the main factors driving the recovery of the Uruguayan economy during the last quarter of 2020, a trend that would continue in the first quarter of 2021, added to the fact that during the second quarter of 2020 the construction of the country’s third pulp mill began, “so it is possible that private investment, very depressed in the last six years, will become active again”, ECLAC predicted.

However, the unemployment indicator had been increasing since the months prior to the pandemic, and as of September it stood at 11%, two points higher than in the same month of 2019.

In the first quarterGDP, of 2021,INFLATION exports totaled US $2,1 URUGUAY: billion, which implies an increase of 19.3% over what AND UNEMPLOYMENT, was exported in the first quarter of 2020.

2018-2020

12

URUGUAY: GDP, INFLATION AND UNEMPLOYMENT, 2018-2020 4

12

2 0

8

-2 -4 -6

4

-8 -10 -12

T1

T2

T3 2018

T4

T1

T2

T3

T4

T1

2019

T2

T3

0

2020

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

S

IMPORTS OF EQUIPMENT ALARMS, FIRE DETECTION AND VIDEO SURVEILLANCE

4 The Consumer Confidence Index (CCI) for the month of2 May 2021, prepared based on surveys in Uruguay, shows an increase of 1.6 points. With a score of 49.7 0 8 in May, although the index still remains at the mo-2 derate pessimism level, it is very close to the limit of -4 moderate optimism (from 50 points). Compared to -6 4 May 2020, the index is 4.1 points higher.

-8 -10 -12

T1

T2

T3 2018

T4

T1

T2

T3 2019

T4

T1

T2

T3

0

2020

GDP, VARIATION RATE OVER 4 QUARTERS.

49,2% CHINA 17,6% EEUU

INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

94

I F S

16,8% OTHERS (ARGENTINA, CANADA, MEXICO, TURQUIA,HONG KONG, JAPAN) 10,4% BRAZIL

TO DECEMBER 2020

6,0% TAIWAN

Source: Descartes Datamyne - National Customs Service.

MONITORING MARKET RESEARCH REPORT

95

Reference index Sources cited: Inter-American Development Bank (IDB), “Revealing expectations in Latin America”, June 2020.

Inter-American Development Bank (IDB), “Latin America overcomes the commercial impact of the pandemic”, Press release, June 3, 2021.

Inter-American Development Bank (IDB), “Education in times of the coronavirus”, May 2021.

World Bank (WB), “World Economic Outlook: Latin America and the Caribbean”, January 2021.

Economic Commission for Latin America and the Caribbean (ECLAC), “The effects of COVID-19 on international trade and logistics”, August 6, 2020.

Economic Commission for Latin America and the Caribbean (ECLAC), “Latin America and the Caribbean in the face of the COVID-19 pandemic Economic and social effects”, April 3, 2020.

Economic Commission for Latin America and the Caribbean (ECLAC), “Preliminary Balance of the Economies of Latin America and the Caribbean, 2020” (LC/PUB.2020/17-P/Rev.1), Santiago, 2021.

Economic Commission for Latin America and the Caribbean (ECLAC), Preliminary overview of the economies of Central America and the Dominican Republic in 2020 and prospects for 2021: February 2021 (LC/ MEX/TS.2021/2), Mexico City, 2021 .

Economic Commission for Latin America and the Caribbean (ECLAC), “Sectors and companies facing COVID-19: emergency and reactivation”, July 2, 2020.

Economic Commission for Latin America and the Caribbean (ECLAC), R. Sánchez and F. Weikert, “Post-pandemic international logistics: analysis of the airline and container shipping industries”, International Trade series, No. 162 (LC/TS. 2020/190), Santiago.

National Administrative Department of Statistics (DANE), “In the first quarter of 2021pr the Gross Domestic Product of Colombia grows 1.1%”, Press release, May 14, 2021.

El País, “Municipalidades no tienen autorización legal para instalar cámaras de reconocimiento facial”, January 15, 2021.

International Monetary Fund (IMF), “WORLD ECONOMIC OUTLOOK: MANAGING DIVERGENT RECOVERIES”, April 2021.

It communication, “Videovigilancia: clave para ciudades inteligentes”, October 20, 2021.

It News.lat, “The Internet of Things: A Growing Business”, August 31, 2021.

Ittrends, “Nuevas tecnologías para impulsar el mercado de sistemas de videovigilancia”, August 10, 2021.

96

Más Seguridad Magazine, “VIDEOVIGILANCIA, PILAR DE LAS CIUDADES INTELIGENTES: HANWHA TECHWIN”, October 25, 2022. itnow Magazine, “El Internet de las cosas: un negocio en crecimiento”, September 1, 2021.

La República, “Ibux lídera videovigilancia en Costa Ricaa”, November 24, 2020.

Organization for Economic Co-operation and Development (OECD), “Tax Statistics in Latin America and the Caribbean 2021”, OECD Publishing, Paris, 2021.

Organization for Economic Cooperation and Development (OECD), “Employment must be at the center of the recovery to avoid serious consequences for the economy and society, says the OECD”, Press release, July 7, 2021.

World Trade Organization (WTO), “Trade crash in the face of the COVID-19 pandemic, which is disrupting the world economy”, Press release, April 8, 2020.

World Trade Organization (WTO), “Trade shows signs of reviving after the effects of COVID-19, but the recovery remains uncertain”, Press release, October 6, 2020.

United Nations Organization, “Policy Brief: Education During and After COVID-19”, August 2020.

Portafolio, “Flujos de capital siguen regresando a la región”, Press release, November 5, 2020.

Procomer, “MERCADO GLOBAL DEL IOT CRECERÁ 15 % A 2024”, September 8, 2020.

Proceso, “Q3.8 millones invirtió el empresariado en cámaras de videovigilancia en Antigua Guatemala”, February 21, 2021.

Databases: International Trade Center (ITC). With information from UN Comtrade (United Nations Trade Statistics Database) and official sources: • El Salvador: Central Reserve Bank.

• Guatemala: Central Bank of Guatemala.

• Paraguay: General Directorate of Customs.

• Rep. Dominicana: UN Comtrade.

Descartes Datamyne. With information from official sources and partner countries: • Argentina: General Directorate of Customs.

• Brazil: Latin American Integration Association (Aladi).

• Chile: National Customs Service.

• Colombia: Directorate of National Taxes and Customs (Dian).

• Costa Rica: National Customs Service • Ecuador: National Customs Service.

• Honduras: General Directorate of Customs Franchise Control.

• Mexico: National Institute of Statistics and Geography of Mexico (Inegi).

• Panama: National Customs Authority.

• Peru: National Superintendency of Customs and Tax Administration (Sunat).

• Uruguay: General Directorate of Customs.

MONITORING MARKET RESEARCH REPORT

97

Códigos de clasificación arancelaria armonizada (HS-code) analizados*: HS-Code** 85

8512 8521 8525

8525.80 8531 8531.10 9027

9027.10

Description Electrical machines and equipment and their parts; sound recorders and players; television image and sound recorders and reproducers; parts and accessories of said articles.

Electrical lighting or signaling apparatus.

Apparatus for recording or reproducing image and sound (videos), even with a built-in receiver of image and sound signals.

Radio broadcasting or television transmission apparatus, whether or not it incorporates sound receiving, recording or reproducing apparatus; Television cameras, digital cameras and camcorders.

Cámaras de televisión, cámaras digitales y videocámaras.

Signaling apparatus; Electrical or visual sound (for example, bells, sirens, indicator panels, burglar or fire alarms), excluding those of items no. 8512 or 8530.

Signaling apparatus; Electric, sound or visual alarms, anti-theft or fire alarms and the like, other than those of heading no. 8512 or 8530.

Instruments and apparatus; for physical or chemical analysis (e.g. polarimeters, spectrometers), to measure or check viscosity, porosity, etc., to measure quantities of heat, sound or light.

Instruments and apparatus; Gas or smoke analysis apparatus for physical or chemical analysis.

*For the tables of imports by companies of chapter 1 and the graphs of imports of chapter 5, only the tariff classification codes of products related to monitoring systems (CCTV cameras, alarms and fire detection equipment) were taken for transactions carried out until January 31, 2022. ** Technical Sheet Survey “TOP BRANDS IN LATIN AMERICA” Data collection dates: Until January 31, 2022.

Data collection technique: Online survey on the Encuestadatos.com platform.

Method: Multiple choice questions.

Subjects to which it refers: Selection of one or more of the brands of monitoring equipment most used by companies.

Target group: The Latin American companies of the Top 50 of monitoring 2022.

Survey developed by Latin Press, Inc.

98

MONITORING MARKET RESEARCH REPORT

99

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