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No. 59

REPORTE MACROECONÓMICO No. 59, Abril 2013 Boletín Mensual del Observatorio Económico, Financiero y Empresarial ISSN: 2027-0216

1

OBSERVATORIO ECONÓMICO FINANCIERO Y EMPRESARIAL ESCUELA DE ECONOMÍA – UNIVERSIDAD SERGIO ARBOLEDA INFORME REALIZADO POR LOS ESTUDIANTES DEL GRUPO DE ESTUDIO EN COLABORACIÓN CON DOCENTES E INVESTIGADORES.

Los errores, omisiones, opiniones, conceptos y recomendaciones realizadas en este documento son responsabilidad de los autores y en ningún momento vinculan o representan la opinión de la Escuela de Economía ni de la Universidad Sergio Arboleda


OBSERVATORIO ECONÓMICO FINANCIERO Y EMPRESARIAL El contenido de ésta publicación está protegido por las normas internacionales y nacionales vigentes sobre propiedad intelectual, por tanto su utilización, reproducción, comunicación pública, transformación, distribución, alquiler, préstamo público e importación, total o parcial, en todo o en parte, en formato impreso, digital o en cualquier formato conocido o por conocer, se encuentran prohibidos y sólo serán legales mediante previa autorización expresa por escrito del autor o titular. Las limitaciones y excepciones al Derecho de Autor, sólo serán aplicables en la medida en que se den dentro del denominados Uso Justo (Fair use), estén previa y expresamente establecidas; no causen un grave e injustificado perjuicio a los intereses legítimos del autor o titular, y no atenten contra la normal explotación de la obra.

MIEMBROS DEL OBSERVATORIO ECONÓMICO FINANCIERO Y EMPRESARIAL Cargo

Contacto

Javier Galán

Director O.E.F.E

javier.galanb@usa.edu.co

Alejandro Bello

Colaborador

alejandro.bello@usa.edu.co

Julián Muñoz

Estudiante

Camilo Romero

Estudiante

Felipe Arias

Colaborador

Andrés Arias

Colaborador

Luisa Torres

Estudiante


Reporte Macroeconómico

No.59

TABLA DE CONTENIDO ECONOMÍA COLOMBIANA 360° .............................................................................. 2 Industria ........................................................................................................... 2 Comercio Minorista ............................................................................................ 3 Comercio Exterior .............................................................................................. 4 Empleo ............................................................................................................. 7 Precios .............................................................................................................. 7 Política .............................................................................................................. 9 QUAESTOR .......................................................................................................... 10 First Quarter 2013 ............................................................................................ 10 April II Fortnight ............................................................................................... 35 INDICADORES ECONÓMICOS ................................................................................ 46

Página 1 – Reporte Macroeconómico N° 59

NOTICIA DEL MES ............................................................................................... 47


Reporte Macroeconómico

No.59 uso especial presentan una reducción del 44.4%, 29.9% y 25.4%, respectivamente (figura 2).

ECONOMÍA COLOMBIANA 360° Javier Galán1

Figura 2 - Producción según clases industriales

Industria

(Variación Anual)

Fabricación de otros tip os de equipo de tran sporte

La producción real cayó 4.47% en febrero de 2013, con respecto al mismo período de 2012. Con relación a las ventas reales, estas disminuyeron en 3.42% respecto al mismo periodo del año anterior (figura 1). Estos datos evidencian que la actividad industrial continua reduciendo la tasa de crecimiento, destacándose que en este período el ritmo de crecimiento se ubica ligeramente por encima del observado en enero de 2013 y muy por debajo del promedio alcanzado en 2011 (3.49%).

Carrocerías para vehículos automotores

Produ ctos minerales no metálicos

-3.64

Productos de plástico

-8.00

Otros productos químicos

-8.31 5.48

Papel, cartón y sus productos

-7.82

Prendas de vestir, confecciones

-9.60

-23.91

Otros produ ctos alimenticios

9.92

Ingenios, refinerías de azúcar y trapiches b/

-11.31

Productos de panadería

-11.38

Produ ctos de molinería y almidones

-10.59

Fuente: Muestra Mensual Manufacturera - Dane

7.93%

4.92% 4.85%

3.51%

-15.93

Hilatura, tejed ura y acab ad o de productos textiles

(Variación Anual)

2.14%

Indu strias básicas de hierro y acero; fundición d e metales

Refinación del petróleo

Figura 1 - Producción y ventas de la industria

6.58%

12.33 -44.36

2.83%

-0.05% -3.42% -4.47% -9.24%

La dinámica del empleo (figura 3) en el sector lleva tres meses retrocediendo, pero en este mes la destrucción de puestos de trabajo fue mucho mayor. La variación anual del empleo fue 2.47% para el mes de febrero, especialmente en la mano de obra no calificada. Figura 3 - Empleo de la industria (Variación Anual)

4% PRODUCCIÓN REAL

VEN TAS REALES

2% 2009

2010

2011

2012

Fuente: Muestra Mensual Manufacturera - Dane

Este comportamiento se explica por el dinamismo en la mayoría de los sectores (12 de los 44 subsectores mostraron crecimiento). Dentro de estos se destacan: productos de tabaco (31.9%), equipos y aparatos de radio, televisión y comunicaciones (29.1%) y maquinaria de uso general (14.5%). Sin embargo, sectores como: carrocerías para vehículos automotores, curtido y preparado de cueros y maquinaria de 1

javier.galanb@usa.edu.co

2013 0% -2%

-2.47%

-4% -6% -8% -10%

Feb May Ago Nov Feb May Ago Nov Feb May Ago Nov Feb May Ago Nov Feb May Ago Nov Feb

2008

2008

2009 TOTAL

Fuente: Dane

2010 CALIFICADO

2011

2012 2013

NO CALIFICADO

Página 2 – Reporte Macroeconómico N° 59

-11.61%


Reporte Macroeconómico

No.59

En cuanto a la productividad industrial (figura 4), la variación anual a febrero de 2013 fue negativa (-2.05%), menor a la obtenida en enero de 2013, y está significativamente por debajo de los niveles observados durante el mismo período de 2012 y 2011.

Figura 5 - Total Comercio Minorista (Variación Anual)

25% 20% 15% 10%

2013

2012

5%

2011

0%

8%

-5%

4%

-10%

0.64%

Feb May Ago Nov Feb May Ago Nov Feb May Ago Nov Feb May Ago Nov Feb May Ago Nov Feb

6%

2%

2008

2009

Fuente: Dane

0%

-6% Ene Feb Mar Abr May Jun Jul Ago Sep Oct Nov Dic Fuente: Dane – cálculos propios

Comercio Minorista

Estos datos indican que el consumo de los hogares viene desacelerando y por lo tanto la dinámica del comercio, especialmente el de vehículos presenta fuertes contracciones. El crecimiento del comercio al por menor se encuentra en niveles similares a los observados a comienzos de la crisis mundial de 2008.

2011

2012 2013

Figura 6 - Comercio Minorista por Grupo de Mercancía (Variación Anual) Feb

Ene

Dic

Nov

Oct

2013 Sep

Jul

Jun

May

Abr

Mar

Ene

2012

Repuestos para vehículos

Muebles para el hogar

Alimentos y bebidas -20.00%--10.00%

-10.00%-0.00%

Fuente: Dane – Cálculos Propios 10.00%-20.00% 20.00%-30.00%

0.00%-10.00%

Página 3 – Reporte Macroeconómico N° 59

-2.05% -4%

El total de las ventas al por menor reales, durante febrero de 2013 crecieron 0.64%, con respecto a febrero de 2012 (figura 5), y continúan por cuarto mes consecutivo en terreno positivo. En lo corrido del año el comercio al por menor ha caído de 2.39% a -3.04%, es decir un 0.65%, con relación al mes inmediatamente anterior se redujo en 3.04%, y en los últimos doce meses la variación pasó de -3.27% a -8.89%, indicando una caída pronunciada.

2010

Diez de los dieciséis grupos de mercancías presentaron crecimiento en febrero de 2013, entre estos se destacan: equipos de informática para el hogar (18.25%), calzado y artículos de cuero (18.12%); Repuestos y accesorios para vehículos (12.84%). Los grupos que presentaron las mayores tasas negativas de crecimiento fueron: lubricantes para vehículos automotores (9.92%) y vehículos automotores y motocicletas (8.20%) (Figura 6).

-0.37%

Feb

-2%

Ago

10%

Figura 4 - Variación anual de la productividad industrial


Reporte Macroeconómico

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Las ventas al por menor sin incluir vehículos presentan un mejor comportamiento al crecer en 2.93% en este mes (figura 7), aunque significativamente por debajo del crecimiento observado en febrero de 2012 (8.02%), aunque mayor al observado en febrero de 2011 (0.82%). Figura 7 - Comercio Minorista sin Vehículos (Variación Mensual)

2010, época en la que Colombia empezaba a recuperarse de la crisis económica mundial del 2008. Figura 8 – índice de Confianza del Consumidor

0.6

ICC

IEC

ICE

0.5

0.4

0.3

20%

2012

2011

2013 0.2

15%

0.1 10%

0 3.4% 2.9%

2010

2011

2012

Fuente: Fedesarrollo (EOC), Cálculos Propios

2013

Comercio Exterior

-5%

El comercio al por menor sin incluir alimentos se sigue comportando en forma similar al total, indicando que las fluctuaciones en el índice se refieren, principalmente, a los vehículos.

Dic

Nov

Oct

Sep

Ago

Jul

Jun

Figura 9 - Exportaciones Mensuales (FOB) (Millones de dólares)

6,000 2010

En efecto, el Índice de Confianza del Consumidor (ICC) 2 presentó una caída significativa de 11.9 puntos porcentuales con respecto a febrero de 2012. Además, se observó que con respecto a enero de 2013 descendió 8.2 puntos porcentuales. La figura 8 muestra que, en lo corrido de 2013, la confianza del consumidor, en promedio, se encuentra por debajo del promedio alcanzado tanto en 2012 como en 2011. Los niveles de confianza del consumidor retrocedieron a niveles de

5,000

4,784

4,668

4,500 4,000 3,500 3,000

PT

Dic

Oct

Sep

Ago

Abr

Nov

Fuente: Dane

Mar

Índice calculado por FEDESARROLLO

Jul

2,500

Ene TP

2013

5,500

2,000 2

2012

FP

M…

PF

2011

Jun

Abr

May

Fuente: Dane

Mar

Feb

Ene

-10%

Las exportaciones continúan con un buen comportamiento, mejor al observado en 2010 y 2011. En febrero de 2013 fueron de US$4,667.8 millones, inferior al observado en el mismo mes del año anterior, US$4,999.3 millones, esta disminución fue de 6.63%.

Página 4 – Reporte Macroeconómico N° 59

0%

Feb

5%


Reporte Macroeconómico

No.59

Sin embargo, se puede observar en la figura 9, que en febrero de 2013 se confirma la tendencia decreciente que las exportaciones vienen presentando desde noviembre de 2012, lo cual hace que la tasa de crecimiento anual, en promedio, de los últimos cuatro meses (-5.8%), caiga a los niveles observados en los primeros meses de 2009.

especialmente por los productos del sector agropecuario (23.93%) e industrial (8.16%), entre los cuales se destacan: vehículos de carretera (incluso aerodeslizadores) (342.4%), Maquinaria y equipo generadores de fuerza (299.8%), cuero y manufacturas de cuero, y pieles finas curtidas (37.8%).

La figura 10, por su parte, muestra el comportamiento de las principales exportaciones, así como del resto de las exportaciones.

El comportamiento de las principales exportaciones se ve opacado cuando se analizan los resultados en términos de toneladas métricas. En efecto, la variación en febrero de 2013 con respecto a febrero de 2012 es del 27.3%, destacándose la caída en las ventas de ferroníquel (-52.1%) y carbón (-46.2) que se explica por los problemas laborales y logísticos del concesionario de la mina del Cerrejón. Además, el volumen de las exportaciones de petróleo crecieron un 10.1%, que comparado con el crecimiento en valor, indican que los precios externos no presentan un buen comportamiento.

Figura 10 Categorías3

-

Exportaciones

por

(Variación Anual)

Principal es Exportaciones

Resto de Exportaciones

12.2%

14.8%

52.2%

31.2%

4.8% -11.1%

Figura 11 – Exportaciones países de destino

según

2011

2012

Fuente: Dane

Mientras las principales exportaciones cayeron un 11.1%, con respecto al mismo mes del año anterior, jalonado por el ferroníquel (-57.89%) y el carbón (-51.85%), mientras que el café (8.75%) continua decreciendo por sexto mes consecutivo; las exportaciones de petróleo y sus derivados crecieron 1.31% cambiando la tendencia observada en los últimos tres meses. El resto de exportaciones crecieron 4.83% con respecto a febrero de 2012, 3

Las categorías exportaciones tradicionales y no tradicionales se redenominaron por "Principales exportaciones" y "Resto de exportaciones", respectivamente.

2013

Suiza -55.8 R. Dominicana Suecia R. Checa Rumania Países Bajos -63.0 Luxemburgo -100.0 Lituania Irlanda -75.8 Grecia -61.2 Francia Finlandia -77.2 Eslovenia -99.8 Bulgaria -100.0 Alemania Uruguay México

33.2 56.4 88.2 190.3

152.7

45.3

318.8 85.8 50.3

Fuente: Dane

El comportamiento de las exportaciones se explica por la caída de las ventas a la Unión Europea (-6.6%) y hacia los

Página 5 – Reporte Macroeconómico N° 59

Feb Mar Abr May o Junio Jul Ago Sep Oct Nov Dic Ene Feb Mar Abr May o Junio Jul Ago Sep Oct Nov Dic Ene Feb

(Variación Anual)


Reporte Macroeconómico

No.59

(Millones de dólares)

2010

2011

2012

2013

5,200.9

4,497.5

Ene Feb Mar Abr May Jun Jul Ago Sep Oct Nov Dic Fuente: Dane

Los principales productos importados, según grandes categorías económicas (CGCE), en este periodo fueron: combustibles y lubricantes, equipos de transporte y sus piezas y accesorios y alimentos y bebidas, con variaciones con respecto a mayo de 2010 de 245.1%%, 64.1%, y 58.7%, respectivamente. Del total de las importaciones el 42.39% son bienes intermedios, el 35.75% bienes de capital, y los bienes de consumo representan el 21.87%.

INTERMEDIOS

CAPITAL

2,000

1,500

1,000

500

Fuente: Dane

2011

2012

El 69.93% de los bienes intermedios y materias primas son para el sector industrial. Los rubros que presentan el mayor variación con respecto a febrero de 2013 son: combustibles (24.8%) y alimentos para animales (12.5%). De igual forma, el 52.71% de los bienes de capital son para dicho sector, seguidos de cerca por los equipos de transporte (37.55%). Se destaca el crecimiento de máquinas y herramientas, así como equipo rodante de transporte cuyas variaciones con respecto a febrero de 2012 llegaron al 23.1% y 40.4%, respectivamente. De los bienes de consumo los rubros que presentan mayor crecimiento con relación a junio de 2010 son: tabaco (218.9%), bebidas (106.7%), vestuario y otras confecciones textiles (30.1%), productos farmacéuticos de tocador (11.8%). Los principales orígenes de las importaciones continúan siendo: Estados Unidos, China y México, con variaciones anuales de 26.2%, 8.4%, y -15.4% respectivamente. Se destaca la participación de Grecia, Malta y Portugal como origen de las importaciones colombianas, las cuales crecieron a tasa superiores del 70.0% en el mismo período (figura 14).

Mar

Ene

Sep

Nov

Jul

May

Mar

Ene

Nov

Sep

Jul

May

0 2013

Página 6 – Reporte Macroeconómico N° 59

Figura 12 - Importaciones Mensuales CIF

CONSUMO

2,500

Ene

Las importaciones presentan una situación similar (figura 12). En febrero de 2013 el balance fue de US$4,497.5 millones presentando una variación anual de -0.68%.

Figura 13 - Importaciones Mensuales CIF (Millones de dólares)

Mar

Estados Unidos (-3.3%), a pesar del repunte del comercio con los países miembros de la ALADI (7.4%), especialmente Uruguay (85.8%) y México (50.3%), a pesar de la reducción del comercio con Chile (29.3%). Las ventas hacia los países miembros de la Comunidad Andina retrocedieron en 1.1%, principalmente por la caída de comercio con el Perú (12.7%).


Reporte Macroeconómico

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Figura 14 - Importaciones según país de origen

La población desocupada presenta una variación negativa respecto al año anterior de 0.38% y los inactivos presentaron una variación positiva de 5.13%. Estas son buenas noticias en materia laboral, el desempleo disminuyó, a pesar de la reducción de la tasa de ocupación (-1.05%) y gracias a la caída en la Tasa Global de Participación (TGP) de 129 puntos porcentuales.

(Variación Anual)

Resto de países

-18.6

China

8.4

Corea

-6.9

Japón -36.1 Italia

14.6

Francia

24.0

Alemania -27.0

Estados Unidos

26.2

Precios

-15.4 4.6

-29.6 -10.3

Fuente: Dane

Durante el mes de febrero de 2013 la balanza comercial de Colombia continúa siendo superavitaria, alcanzando los USD366.4 millones (FOB) y en lo corrido del año asciende a USD222.64 millones, inferior en un 83% a la observada en el mismo período de 2012.

Figura 15 - Variación Mensual del IPC (Porcentaje)

1,0% 2013

Empleo En materia del mercado laboral, la tasa de desempleo disminuyó 0.2 puntos porcentuales, respecto de marzo de 2012, para el mes de marzo de 2103 de 2011 se ubica en 10.2%. El empleo informal se ubicó en 49.81%, reduciéndose en 0.58 puntos porcentuales, la informalidad se redujo mas en las mujeres (1.16 puntos porcentuales) que en los hombres (0.16 puntos porcentuales)

PET

35.627

36.154

528

1,48% Fuente: Banco de la República

PEA

22.864

22.737

-127

-0,55%

20.494

20.416

-78

-0,38%

Ocupados Desocupados

2.370

2.321

-49

-2,06%

12.763

13.417

654

5,13%

TD

10,4%

10,2%

-0,2%

TO

57,5%

56,5%

-1,05%

TGP

64,2%

62,9%

-1,29%

Inactivos

Fuente: Dane

De otro lado, la inflación sin alimentos para el mes de febrero (Figura 15) muestra la variación de los bienes transables (1.13%) y no transables (3.85%) en 2013 es superior a las

Dic

-0,2% Var. %

Nov

0,0%

Página 7 – Reporte Macroeconómico N° 59

0,21%

0,2%

Oct

Dif.

0,4%

May

mar-13

0,6%

Ene

mar-12

2011

0,8%

Feb

Tabla 1 - Mercado Laboral Concepto

2012

Sep

Ecuador

Abr

Argentina

La inflación para el mes de marzo de 2013 se ubica en 0.21%, porcentaje superior a la de marzo de 2012 e inferior a marzo de 2011, 0.12% y 0.27%, respectivamente (Figura 15). En lo corrido del año la inflación es de 0.95%, y la inflación anual es 1.91%, inferior a la media de la meta establecida por el Banco de la República (3%), en el intervalo (2% 4%).

-2.1

Ago

Brasil

Jul

Chile

Jun

México

Mar

Canadá

-11.4


Reporte Macroeconómico

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presentadas en el mismo período del año 2012, 0.73% y 3.70%, respectivamente.

Figura 16 - Variación Anual (%) IPC por grupo de gasto

Otros Gastos Figura 15 - Variación Anual IPC sin alimentos

1,28%

Comunicaciones

3,38%

(Porcentaje)

8%

Transporte

0,87%

7%

Diversión

6% 5%

Educación

4%

4,46%

3,85%

Salud

3% 2%

Ene

Mar

Nov

Alimentos

1,41%

Fuente: Banco de la Repùblica

Regulados

0.0% -0.5%

-0.32%

-1.0% -1.5%

2012

2013

Fuente: Banco de la República

Esta variación se explica por el comportamiento de los precios para los sectores agropecuario, minero e industrial, que presentan variaciones

Abr

Mar

Feb

Dic

Ene

-2.0%

Página 8 – Reporte Macroeconómico N° 59

0.5%

Nov

Entre enero y febrero de 2013 Cali presenta la menor variación en el IPC con (-0.16%), mientras que la mayor variación se observó en Sincelejo y Florencia (0.46%). La menor variación anual en el IPC lo tiene la ciudad de Cúcuta (0.82%), mientras que Bucaramanga presenta la mayor variación (2.97%).

1.0%

Oct

Las variaciones del IPC con y sin alimentos continúan siendo bajas (Figura 16). En los últimos doce meses la educación (4.46%), alimentos (4.77%), salud (3.61%) y comunicaciones (3.38%) son los grupos que mayor crecimiento han presentado. Diversión fue el grupo con la menor variación en el mes, -0.33% (Figura 16).

Figura 17 - Variación Mensual (%) IPP

Sep

Con respecto a los bienes regulados, estos continúan su tendencia decreciente desde marzo de 2011, con una variación anual de 0.20%, que es superior a la observada en febrero del año anterior (5.58%).

Los precios para el productor en marzo de 2013 se redujeron en 0.32% con respecto a febrero de 2013 (Figura 17). En lo corrido del año el Índice de Precios al Productor ha aumentado en 0.17% y en los últimos doce meses la variación fue de -2.42%

Jul

Fuente: Banco de la República

Ago

Jul

2,49%

Jun

No transables

2013

0,76%

Vivienda

May

Transables

2012

3,61%

Vestuario

Abr

2011

Sep

May

Ene

Mar

Sep

Nov

Jul

0,20% Mar

0% May

1,13%

Ene

1%

-1%

0,33%


Reporte Macroeconómico

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anuales negativas de 6.35%, 13.78% y 0.62%, respectivamente (Figura 18). La reducción en el IPP para el sector minero se explica por la variación en el subgrupo extracción de petróleo crudo y de gas natural, que se redujo en 8.23%; la variación en el sector industrial se vio influenciado por la caída en fabricación de productos metalúrgicos básicos (7.66%) y fabricación de maquinaria de oficina, contabilidad e informática (3.08%), sin embargo en este mes se presentaron aumentos en el IPP de fabricación de productos de tabaco (6.47%) y en fabricación de otros productos minerales no metálicos (4.19%).

República decidió reducir en 50 puntos básicos la tasa de interés de intervención, quedando ésta en 3.25% (Figura 19). Figura 19 – Tasa de Intervención en Política Monetaria 5.5%

5.0%

4.5%

4.0%

3.5%

3.25% 3.0%

Figura 18 – IPP por Sección CIIU (Variación anual)

Minería

Industria

15% 10% 5% -0.62%

0% -6.35%

-5% -10%

-13.78%

-15% Abr Jun Ago Oct Dic Feb Abr Jun Ago Oct Dic Feb Abr Jun Ago Oct Dic Feb Abr

-20%

2010

2011

2012

2011

2012

Ene

Mar

Nov

Jul

Sep

May

Ene

Mar

Nov

Jul

Sep

May

Ene

Mar

Nov

Sep

Jul

2010

2013

Fuent e: Banco de la República - Cálculos propios

2013

Fuente: Banco de la República

El IPP para los bienes de consumo intermedio se redujeron en 3.85%, mientras que el IPP para los bienes de consumo final, los bienes de capital y los materiales de construcción aumentaron en 0.10%, 0.68% y 2.31%, respectivamente, con respecto a marzo de 2012

Política En reunión del 22 de marzo de 2013, la Junta Directiva del Banco de la

En su informe la Junta considera que el descenso de la inflación se encuentra del rango proyectado por el equipo técnico, reconoce que las presiones de los precios internacionales de la energía y otros productos básicos se ha reducido. Por otra parte, los datos del crecimiento económico muestran una desaceleración debida a la reducción de la inversión; así mismo se espera que el crecimiento de los socios comerciales sea menor a lo esperado. Los índices que reflejan las expectativas de los consumidores se deterioraron, así como la confianza de los empresarios. Se empezó a observar una transmisión de la reducción de las tasas del Banco de la República en el sistema financiero, el cual muestra un crecimiento moderado de la cartera, lo cual reduce el riesgo sobre la calidad de esta.

Página 9 – Reporte Macroeconómico N° 59

20%

May

25%

Ene

Agropecuario

Mar

2.5%

30%


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QUAESTOR

Business Environment Watchdogs

Javier Galán4 Felipe Arias

First Quarter 2013 January – April 8 DATA: Peso – Dollar Exchange Rate (ER) Exchange Rate: Level & Volatility 1825,00

25,00 23,00

Avg. (30 - Day); left axis 1815,00

21,00 1805,00

19,00 17,00

1795,00 15,00 1785,00

13,00 11,00

St. Dev. (45 - Day); right axis

1775,00

9,00

07/04/2013

27/03/2013

16/03/2013

05/03/2013

22/02/2013

11/02/2013

31/01/2013

20/01/2013

09/01/2013

29/12/2012

18/12/2012

07/12/2012

26/11/2012

15/11/2012

04/11/2012

24/10/2012

13/10/2012

02/10/2012

7,00 21/09/2012

1765,00

• Note that during the first quarter of 2013 the ER went through a trend reversal cycle: i)

ER (30 – day avg.) January 2 = $1,804.41

ii)

ER (30 – day avg.) February 7 = $1,772.74

iii)

ER (30 – day avg.) April 8 = $1,810.85

• The driving force of such dynamics was the Feb – Mar 3% (53 Colombian Pesos – COP – per $US) depreciation: i) 4

ER January 31 = $1,773.24

javier.galanb@usa.edu.co


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ii)

No.59

ER April 8 = $1,826.88

• For sure, the Feb – Mar depreciation was a natural market response to the Central Bank’s (CB) loose policy stance (in response to output slow down, see below). •

In fact, the CB has cut its interest rate in 100 basis points (bps) during 2013:

i)

25 bps on Jan 28.

ii)

25 bps on Feb 22.

iii)

50 bps on Mar 22 (and the rate is currently standing at 3.25%).

• Plus, the CB has adopted a more active international reserve accumulation policy: $US 30 million daily (or $US 3 billion between Feb and May), as opposed to the $US 20 million per day it had been purchasing before. •

Of course, ER dynamics have also been influenced by exogenous factors:

i) FED signaling less Quantitative Easing (QE) due to output data revealing a bit of economic recovery in the U.S. (though not as much as expected according to April 5’s job creation report). ii) Uncertainty in Europe (Italy, Spain, Greece, and Cyprus) has triggered risk aversion, thus inducing short term capitals to flee from emerging markets and into safe havens (like US T Bills).

• Of course, the Feb – Mar COP depreciation might still be transitory. Unless… output slowdown (inducing a consistently loose monetary policy stance from the CB), adverse shocks to business environment in the Colombian economy (see below) become permanent, and external shocks to the ER continue to kick in (less QE, more uncertainty in Europe, etc.). • Hence, at this point we suggest caution before adopting a final stance on the future trend of the ER (which could be depreciation – like). • If so, don’t forget that any systematic and steady depreciation of a currency is not a good symptom of confidence in the economy´s environment. On the contrary, it reflects a reduction in the demand for (or confidence in) its currency. • Not to mention that depreciation melts down the real (dollar) value of any foreign investor’s net worth (that´s why we never understood the Minister of Finance’s yearning for a $1,950 ER). • On the other hand, note that ER volatility skyrocketed during January, plummeted during February and picked up again during March:

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• In any case, note that there’s no evidence yet of an inflection point in the 30 – day ER average so as to predict comfortably that the current level is a max and that it will converge back to the $1,800 threshold.


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i)

St Dev. (45 – day avg.) January 2 = $16

ii)

St Dev. (45 – day avg.) January 23 = $23

iii)

St Dev. (45 – day avg.) February 25 = $11

iv)

St Dev. (45 – day avg.) April 8 = $16

• For sure, ER volatility is still fluctuating significantly above its 10 – 11 peso minimums. This means that hedges against ER fluctuations are not at its cheapest price. •

However, volatility is not at its highest level either. The max levels have been:

i)

$23 during the first quarter of 2013 (Jan).

ii)

$27 during the second half of 2012.

iii)

$61 (!!!) during the first half of 2012.

• In sum, it could be a good time for tradable sector companies to purchase hedges against ER fluctuations. • Remember: the higher the volatility, the more expensive the hedging. Don´t wait for volatility to pick up again as happened during last year’s first quarter. QUAESTOR’s $US Value of Domestic Stock Price Index $US Value of Stock Prices 106,00 105,00

103,00 102,00 101,00 100,00 99,00 98,00

05/04/2013

29/03/2013

22/03/2013

15/03/2013

08/03/2013

01/03/2013

22/02/2013

15/02/2013

08/02/2013

01/02/2013

25/01/2013

18/01/2013

11/01/2013

04/01/2013

28/12/2012

21/12/2012

14/12/2012

07/12/2012

30/11/2012

23/11/2012

16/11/2012

09/11/2012

02/11/2012

26/10/2012

19/10/2012

12/10/2012

97,00

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104,00


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• The Colombian stock market went through a boom – bust cycle during the first quarter of 2013. • 30 – Day avg. gains (as measured by our index) peaked at 5% on Feb 15, but vanished completely after that. • Indeed, the Jan to mid – Feb bullish market turned around completely into a bearish market during the second half of the first quarter, and prices (in dollar terms) are now below 2012 levels. • Furthermore, the main index (IGBC) has dipped under the 14,000 psychological threshold. • Moreover, if price movements aren’t averaged out, market conditions are even more dismal: $US 100 invested in on Jan 02 have become $US 90 on Apr 05. • The driving force of this stock market dynamics was the severe price plunge that took place between mid – Feb and first week of April (9.5% nominal drop in the index). • Such a plunge, coupled with the 3% Feb – Mar COP depreciation, wiped out the original Jan to mid – Feb stock market dollar value gains. •

Our diagnosis:

1.

Traded volumes have been 20% below those of 2012.

2. Dismal corporate results: only 57% of those companies listed in the IGBC reported profit growth.

4. GEA group announced more stocks to be issued for Cementos Argos and Bancolombia (price reduction due to expected increase in supply). 5.

Recent deterioration of business environment in Colombia (see below).

6. Consistently loose monetary policy (attributable to domestic output slowdown) depreciating the COP (see above). 7. Uncertainty in Europe + mild recovery in the U.S. has induced higher relative risk premiums in emerging markets (so capitals flee more to safe havens). •

All in all, we believe the market will remain bearish in the medium – run.

Treasury Bills (TES) Implicit Interest Rates • Implicit interest rates on the July 2020 TES bond (11% coupon, issued on July 24 2005, expire on July 24 2020) exhibited a downward sloping trend until the first week of March:

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3. Disappointing data from oil and gas sector (O&G) companies: less than expected reserves, production and profits. O&G companies represent 23% of the COLCAP Index (capitalization weighted average index of companies with high liquidity levels).


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TES 2020 Implicit Rate 5,80% 5,60% 5,40% 5,20% 5,00% 4,80%

i)

TES Rate January 3 = 5.39%

ii)

TES Rate March 7 = 4.68%

That’s a 71 bps drop.

However, the rate is again above 5% (5.03% on April 5).

05/04/2013

28/03/2013

20/03/2013

12/03/2013

04/03/2013

24/02/2013

16/02/2013

08/02/2013

31/01/2013

23/01/2013

15/01/2013

07/01/2013

30/12/2012

22/12/2012

14/12/2012

06/12/2012

28/11/2012

4,60%

• Thus, Treasury bond prices have fallen and, as in the stock market, at this pace the Jan – Feb value gains will be wiped out soon.

• On Friday April 5 DANE (National Statistics Agency) published inflation data for March 2013: 0.21% (vs. 0.12% on Mar 2012). •

Hence:

i) Cumulated inflation (Jan – Mar) stands at 0.95% (compared to 1.47% during Jan – Mar 2012). ii) Annual inflation (Apr/2012 – Mar 2013) is at 1.91% (compared to 3.40% during Apr/2011 – Mar 2012). • Fortunately, consumer price data reflects full stability in price behavior and portrays sufficient macro/monetary stability for investment purposes. • However, inflation data might also be revealing domestic economic deceleration and aggregate demand weakening.

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Inflation Rate


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Inflation 1,00%

0,04 0,035

0,80%

Annual; right axis

0,03

0,60%

0,025 Monthly; left axis

0,40%

0,02 0,015

0,20%

0,01 0,00%

0,005

Feb 2013

Mar 2013

Jan 2013

Dec 2012

Oct 2012

Nov 2012

Sep 2012

Aug 2012

Jul 2012

Jun 2012

Abr 2012

May 2012

Mar 2012

Jan 2012

Feb 2012

Dec 2011

Oct 2011

Nov 2011

Sep 2011

Jul 2011

Aug 2011

Jun 2011

Abr 2011

May 2011

Mar 2011

Jan 2011

0 Feb 2011

-0,20%

Output Performance • Recent relevant data: i) Friday February 22 (DANE): During Dec 2012 output, sales and hired workers in the manufacturing sector contracted at 3%, 2% and 0.7% respectively (with respect to Dec 2011). 29 subsectors (out of 48) exhibited production drops between Jan/2012 and Dec/2012. Because of this, output in the aggregate manufacturing sector didn´t grow at all during 2012.

iii) Tuesday February 26 (DANE): 17.8% fall in the area with construction licenses during 2012. The sharpest drop was registered in areas destined for schooling (– 27.4%) and housing (– 20.5%). iv) Wednesday February 27 (DANE): 7.4% contraction in cement production during Jan 2013 (in relation to Jan 2012). Dispatches to Bogotá plummeted19.9%. v) Thursday February 28 (DANE): Unemployment during Jan 2013 stood at 12.1% nationwide (vs. 12.4% on Jan 2012). vi) Wednesday March 6 (DANE): 1.1% reduction in total exports during Jan 2013 compared to Jan 2012: $US 4,734.7 million on Jan 2013 vs. $US 4,785.6 on Jan 2012. The contraction is due to a 9.4% export drop in the Ag/Foodstuffs sector, as well as to a 5.5% fall in exports in the fuel and extractive industries. vii) Tuesday March 12 (Fedesarrollo): Consumer Confidence Index dropped 11.9 percentage points during Feb, and is now at 14.9% According to the think tank, the

Página 15 – Reporte Macroeconómico N° 59

ii) Monday February 25 (DANE): Energy consumption in the manufacturing sector grew at a dismal 0.8% rate during Jan 2013 (with respect to Jan 2012).


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last time the index dipped below the 15% threshold was during May 2011 (and in relation to the month of Feb it was during Feb 2010). viii)

Thursday March 14 (DANE): Vehicle sales grew a dismal 0.6% during 2012.

ix) Thursday March 14 (DANE): Trade deficit in the Colombian economy during Jan 2013 was $US 213.3 million. This number contrasts sharply with the $US 623.4 million surplus registered during Jan 2012. x) Monday March 18 (DANE): 19% growth rate for imports during Jan 2013 ($US 5.2 billion). Imports of agricultural products and foodstuffs skyrocketed (41.2%). Manufacturing imports also grew at a higher than expected rate (16%). 29% of all imports originate in the U.S. (16% in China, 8% in Mexico, 5% in France and 5% in Brazil). xi) Thursday March 21 (DANE): GDP growth rate for 2012 was 4%. The corresponding quarterly growth rates were: 5.3%, 5.0%, 2.7% and 3.1%. Sectors with the highest annual growth rates were: •

Mining (5.9%).

Financial (5.5%).

Sectors with the lowest GDP growth rates were: •

Manufacturing (–0.7%).

Agriculture (2.6%).

Construction (3.6%).

Electricity, gas and water (3.5%).

Transportation, storage and communication services (4.0%).

Retail, repair, restaurant and hotel services (4.1%).

Social, community and personal services (4.9%).

In manufacturing, subsectors with the sharpest drops were: tobacco products (– 11.5%), spinning/weaving products (–7.7%), machinery and electrical appliances (– 6.5%), rubber and plastic products (–5.8%), oil refining (–5.1%). In agriculture, DANE didn´t disaggregate performance by subsectors. The 3.6% growth rate in the construction sector was the result of a dismal 2.2% growth rate in public works and a 5.5% growth rate in private housing/buildings. This reveals a very poor executive capacity in national and local governments.

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Other sectors:


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Demand wise there seemed to be some sort of growth balance: final consumption (4.4%), investment (5.7%) and exports (5.3%). A higher than expected 8% import growth rate was also reported. Even though DANE didn’t disaggregate the 4.4% consumption growth rate in private and public spending, the latter probably exhibited a lower growth rate (given the very low 2.2% growth rate in public works). Finally, the overall GDP growth rate was 20 to 30 bps higher than what the market expected. However, if it weren’t for a last minute (upward) revision of the third quarter´s growth rate, the yearly rate would have been below 4% (and more in line with the 3.7% - 3.8% rate that the market expected). Many questions regarding DANE’s technical neutrality are being asked in the market. xii) Friday March 22 (DANE): 1.7% output drop in manufacturing during Jan 2013 (in relation to Jan 2012, when it had registered a 1.3% drop). Sales and occupied personnel also contracted in 2.5% and 1.3%, respectively. Furthermore, 28 (out of 48) manufacturing subsectors exhibited output reductions during the first month of the year. Those with the sharpest drops were: apparel (–18.1%), nonmetal minerals (– 7.3%), spinning/weaving (–28.7%), iron & steel (–11.3%). xiii) Monday March 22 (Acolgen): Energy consumption grew at a 3.2% rate during Feb 2013 (vs. 2.6% during Feb 2012 and 4.5% during Jan 2013). Non – regulated energy demand grew 2.6%, while regulated energy consumption (residential and small business) grew 3.5%. XM, a different info source, reported a 5.6% growth rate in energy demand during Feb 2013. xiv) Sunday March 31 (DANE): Unemployment during Feb 2013 stood at 11.8% nationwide (vs. 11.9% on Feb 2012).

• Evidently, tradable sector output has stagnated (and even contracted in several subsectors). •

First symptoms of external (trade) imbalances are also popping up.

Additionally, consumer confidence has deteriorated significantly.

• Finally, the national unemployment rate has been stuck during the last few months above the 10% threshold. • Unfortunately, the government is showing a very little capacity of implementing an effective counter cyclical fiscal policy and, thus, offsetting any further deceleration of the economy. • On April 15 the government will reveal a policy package aimed at reviving tradable sector output (especially manufacturing). It will include: tariff reduction for industrial inputs, fee reduction in gas services for the manufacturing sector, anticipation of the 2012 tax reform benefits for manufacturing, among others.

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xv) Friday April 5 (BanRep): GDP growth during the first quarter of 2013 was forecasted at a lower rate than the one observed during the last quarter of 2012 (3.1%). If so, the growth drop will be above 200 basis points (recall that during the first quarter of 2012 GDP grew at a 5.3% rate).


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UNDER OUR WATCH: • Monday January 14: President Santos announced via twitter that “Los Ciruelos” Hotel Project in the Tayrona National Park (State of Magdalena, Caribbean Coast), comprising a US$ 7 million investment, will not be permitted under his administration. Santos ignored legal and property rights entitled to the stakeholders of this project through a proper environmental license. • Wednesday January 23: President Santos signed a decree imposing a 4 $US per kilogram specific tariff on shoe and apparel imports from China. According to government officials, this is simply a 6 – month transitory measure (yet extendable) to offset uneven and disloyal competition coming from China, while permanent anti – dumping tools are put in place. After the announcement, other sectors (iron, steel, notebooks, leather, etc.) demanded similar protectionist measures against Chinese competition. In layman terms: the government gave in to the textile, apparel and rag trade lobby. • Thursday January 24: Government officials announced tax breaks to those companies that hire sexually and physically abused women. The tax break is equivalent to 200% of the corresponding payroll. Beyond the obvious justice that every citizen expects for such a group of people, ¿who can certify their a condition with absolute transparency? This is a distortive loophole.

• Friday February 1: OECD’s Chief Economist Pier Carlo Padoan presented a study of the Colombian economy. Many analysts said the report was a cold shower on the government’s longing and yearning for membership of OECD (34 countries that generate 80% of the world’s GDP). • Monday February 4: The IMF’s annual report on the Colombian economy (under Article IV), approved of Colombia’s macroeconomic policy in terms of protecting production against negative external shocks, preserving GDP growth dynamics and keeping low inflation levels. The Fund also highlighted the soundness of the domestic financial sector (sufficiently capitalized and profitable). It also praised some elements of last year’s tax reform and the government’s pension reform initiative. However, the Fund encouraged policymakers towards deeper fiscal reform (hinting at higher taxes on raw materials aimed at opening up fiscal possibilities for public infrastructure improvements). Furthermore, the Fund insisted on measures for unemployment reduction, productivity growth, rising saving levels and export diversification. Additionally, the Fund warned that the economy is still vulnerable to:

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• Thursday January 24: Hodecol (Decameron Colombia) and other tourism sector companies (like Sensation Catamarans) announced cutbacks in operations in San Andrés and Providencia (Caribbean islands). This is a result of the natural distortion created by a government subsidy granted to air fares to Providencia in state owned Satena Airline. The subsidy was implemented to make up for a ruling by the International Court of Justice in The Hague granting Nicaragua a big chunk of sea waters (in the vicinity of San Andrés and Providencia) that had previously belonged to Colombia. Here´s a killer side effect of an applauded, yet populist and distortive, policy.


Reporte Macroeconómico

i)

Growth deceleration of trading partners.

ii)

Possible oil price slump.

iii)

Higher risk aversion in international financial markets.

No.59

Colombia maintains a $US6 billion Flexible Credit Line with the IMF. It’s a more than enough buffer against any possible emergency or adverse shock on the economy. Fortunately, public officials have reasserted that, under present conditions, there’s no need whatsoever of using the Fund’s credit line. • Monday February 4: ANLA (Environmental License National Agency) rejected 8 environmental licenses for coal extraction in the state of Cesar. The licenses had been requested by corporations like Drummond, Prodeco and Goldman Sachs, and would have doubled coal production in Colombia. According to ANLA Director, the main reason underlying the rejection of these licenses is that the projects didn’t meet atmospheric emission standards. This is a setback for FDI and environmentally responsible extraction in the coal sector. • Wednesday February 6: The Colombian Petroleum/Oil Association (ACP) warned that FDI in Colombia’s oil sector will decline sharply if several reforms aimed at increasing taxes and royalties on oil production make it through Congress. According to ACP’s Director, if such reforms are implemented the state take could increase to 90%, making business in the oil sector completely unfeasible.

• Thursday February 7: ANLA officials announced the suspension of Drummond’s license for loading coal in its Santa Marta and Ciénaga port. The Agency also announced a fine to the company. The sanction came after a 2,000 ton coal spill accident from one of Drummond’s flatboats into the seawaters of the Santa Marta and Ciénaga coast. The incident occurred on January 13 and wasn’t reported to environmental authorities (as was the company’s obligation). In any case, the company is currently investing $US 450 million in a 2.4 km dock that will enable direct loading, thus ceasing the flatboat system and avoiding future environmental incidents of this sort. Note that Drummond is a global leader in coal and coke production (American and Japanese capital). It ships 80k daily tons of coal from Colombia to Europe. The mines (La Loma, El Descanso) are located in the nearby state of Cesar. At current coal prices the license suspension represents a $US 6.4 million daily loss. The General Attorney’s Office also announced a full – fledged penal investigation of the spill. Keep in mind that under Colombia’s penal code incidents of this sort are categorized as environmental crimes. Expect indictments, accusations (and not many acquittals).

Página 19 – Reporte Macroeconómico N° 59

He also warned that, even though oil production will grow during 2013, investment in the O&G sector will fall in comparison to 2012 (Pacific Rubiales probably being the exception). Indeed, this year no new off – shore exploration is expected due to investor perception of lack of legal stability. Additionally, security risks are becoming an increasing obstacle to new investment in O&G.


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Unfortunately, this incident has enhanced animosity, contempt and fire from public opinion leaders against FDI in mining. In fact, by Friday February 15 the General Attorney´s Office had begun collecting evidence and obtaining depositions in the midst of the penal process against Drummond. Even though on March 1 ANLA approved Drummond’s contingency plan and called off the (21 day long) sanction, the company will be fined with a monetary penalty (the sum will be revealed by ANLA in May; expect it to be high and exemplary). As if all this weren´t enough, on Monday April 1 ANM (National Mining Agency) imposed on Drummond a $US 2 million payment due to a pending tariff settlement between the company and FENOCO (railway company that carries coal from different mines in the northern region of the country to port). Without doubt, the publicized decisiveness of the government and the General Attorney against Drummond is both cause and effect of an emotional (and irrational) self – feeding frenzy in certain sector of Colombian public opinion against FDI in mining. • Friday February 7: Union leaders broke up wage negotiations with Cerrejón company representatives and announced the initiation of a general strike. This occurred after 22 years of peace between labor and management in the company. Cerrejón belongs to BHP Billiton (Anglo – Australian capital), Anglo – American (Anglo – South African capital) and Xstrata (Swiss capital).

In any case, this episode (in combination with the Drummond incident) has put at risk Colombia´s coal production goal for 2013 (98 million tons), while enhancing the rejection of certain segments of public opinion towards FDI in mining. • Monday February 11: Minister of Environment announced that despite the suspension of 8 environmental licenses to multinational coal companies by ANLA, additional control is required over them. Yet, in the same interview he accepted that: 1.

The Ministry’s mission exceeds its own technical capacity.

2. There’s a lack of coordination between the Ministry and independent regional environmental authorities (CARs). No wonder there is animosity and contempt from certain segments of public against FDI in mining (enhanced by the unfortunate Drummond coal spill accident and the management – labor tension in Cerrejón). As we see, it tends to be fueled not only by the General Attorney’s Office, but also by an unfit national environmental authority (as recognized by the Minister himself), that keeps on rallying public opinion against foreign coal mining companies.

Página 20 – Reporte Macroeconómico N° 59

Even though on Monday March 11 the company and its labor union reached an agreement to put an end to the strike, the production halt cost the company approximately $US 80 million (2.5 million coal tons were not exported).


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No.59

• Monday February 11: A judge suspended during 6 months mining rights entitled to companies like Anglo Gold Ashanti (South African capital) in the state of Chocó (western region of the country, Pacific coast). The judge’s decision is founded on property rights being claimed by native and indigenous groups over the land where the titles were granted by the ANM to these corporations. Note that it’s the first time that a judge suspends foreign investors’ mining (property) rights invoking the Bill of Victims approved by Congress in 2011. One of the chapters of such a bill (the one invoked by the judge) is devoted to victims’ land rights in Colombia. No one disagrees with a victim’s right to claim his/her legitimate right to any piece of land or property violently snatched from him/her in the past. But this judge’s decision was the first step towards expropriation of foreign investors’ legitimate (and well – intended or obtained in good faith) property rights in Colombia, using the Bill of Victims as an excuse. • Tuesday February 12: A court in the state of Magdalena suspended and conditioned the environmental license that authorized the development of the “Los Ciruelos” Hotel Project in the Tayrona National Park until indigenous communities are consulted.

In this case, legal and property rights are being openly ignored due to ideological/political reactions. In fact, this ruling came after President Santos announced one month before (January 14) that the “Los Ciruelos” Hotel Project (despite having a proper environmental license) would not be permitted under his administration due to new environmental considerations and indigenous rights (as if he could do that). Hence, it seems that when the central government fuels public feelings against investment in (politically or ideologically) sensitive sectors, judicial authorities feel free to validate them, thus expelling environmentally responsible investors and attracting illegal activities. • Tuesday February 12: A court in Cartagena expropriated a piece of land (15 hectares) from its 2001 buyer in the municipality of Morroa (state of Sucre). The court ruled in favor of its previous owner (a peasant that sold it as he wanted to flee the area due to the terror and violence of those days – 2001 –). According to the ruling, the low price paid for the land was a fraudulent or deceitful action committed by the buyer, who took advantage of the precarious conditions (poverty, fear, terror) of the seller back in those times. Furthermore, according to the court, even though the seller acted with free will during the transaction (and there was no threat or violent act committed by the buyer upon the seller), the buyer never proved in court that he had acted in good faith. Recall that the Law of Victims enacted by Congress in 2011 inverted the burden of proof in this type of cases. The Cartagena court has interpreted this article of the Bill (and has set

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In the same ruling the court also suspended ecotourism in another area of the park that had been granted to Unión Temporal Concesión Tayrona since 2005 (pending consultation with indigenous communities and delimitation of sacred sites). Tourist visits to their Ecohabs Hotel were suspended. The representative of Unión Temporal Concesión Tayrona announced that, if necessary, they are willing to abandon their investment in the park.


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the precedent) in the sense that any current landowner has to prove and provide evidence that he/she not only bought his/her property acting in simple good faith, but also with the due diligence to make sure that he/she was acting according to the law, and not taking advantage of land price declines due to violence and terror. ¿Can you believe that? Moreover, the seller (peasant) does not have to refund the price he received when he sold the land. He gets to keep it as part of the compensation for being a victim. With this Cartagena court ruling we have seen another exhibition of full disrespect for land property rights under the invocation of the Bill of Victims (it came just one day after a judge suspended mining rights entitled in Chocó to Anglo Gold Ashanti, also using the Bill of Victims as an excuse). This is fatal for business environment and investor confidence in the Ag and Mining sectors in the Colombian economy. The scariest part of the ruling is that the court felt free to prohibit and punish price formation according to free will and supply – demand equilibrium. There’s an upside though: we suggest you sue the person that bought any piece of land from you. Argue in court that he/she took advantage of your fear (of violence) and, because of that, you had to accept a very bad price. ¿What is a bad price? Doesn’t matter. Equilibrium (supply – demand) in markets is not relevant anymore. Thanks to this Cartagena court you have a good chance of getting your land back, without having to refund the money you were paid for it. • Thursday February 14: ANM (National Mining Agency) announced that the official coal production goal for 2012 (93 million tons) was not met (actual production only was 89 million tons). Even though the Agency’s officials attributed this underperformance to the drop in coal prices and to the mid – year strike in Fenoco, it seems that deterioration of business environment, legal stability and investor confidence in the mining sector also played a role (and could kick in even harder during 2013). Monday February 18: The CB revealed FDI data:

1. $US 16,679 million during 2012 (the government expects $US 14k million during 2013). 2. $US 1,313 million during January of 2013 (18.2% decline with respect to January of 2012). 3. $US 1,030 million during January of 2013 for mining and oil (11.7% reduction in comparison to January of 2012). Two takeaways. First, FDI is slowing down. Second, FDI is still highly dependent on mining/oil, a sector enduring a severe deterioration in business environment and investor confidence. • Thursday February 21: The Minister of Mines requested to the Constitutional Court an extension of the due date for Mine Code consultations with indigenous groups. Recall that the Mine Code was declared unconstitutional by the court because

Página 22 – Reporte Macroeconómico N° 59


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of lack of such consultations. If the extension is not granted, legal instability will deepen in the mining industry. • February/March Social Unrest: Multiple expressions of social unrest erupted all over the country. i) Coffee farmers: Carried out a national strike that lasted 12 days (February 25 – March 8), asking for subsidies and bail – outs, on the basis of the drastic drop in domestic prices (COP appreciation + fall in world price). The strike resulted in major road blocks and violent confrontations with the Police in 7 or 8 regions of the country (especially in the states of Cauca, Huila, Caquetá and Antioquia). Some capital cities (like Popayan) came to the verge of a humanitarian crisis (due to scarcity of food, gas and medical supplies). Without question, the strike was handled clumsily by the government. At the end it gave in to the farmer´s demands and granted a US$ 450 million bail – out and subsidy program. ii) Truck drivers: After a three – day national strike (that aggravated coffee farmers’ road blocks) the government yielded to diesel price reduction demands: a US$ 13 cent per gallon drop in March and April. iii) Cocoa farmers: Their strike in the state of Santander got them a $US 700 per ton subsidy (50% central government – 50% state government).

The President himself (and several Ministers and government officials) had to travel over there, meet with community and business leaders (town – hall like) and, naturally, endure open hostility towards the administration. In any case, the President announced a $US 2.5 billion policy package that will supposedly boost Cucuta’s economy: roads, homes, schools, safety net expansion, open sky policy, Cucuta’s aqueduct, etc. After the President left, local (political and small business) representatives manifested deep skepticism towards the effectiveness of the President’s announcements (even if properly and diligently executed). Expect more unrest. v) Steel workers: On Monday March 11 500 of them blocked the highway connecting Bogota and Sogamoso (major steel producing city in the central highland state of Boyacá). They asked for deeper controls against steel smuggling and imports. vi) Rice farmers: Announced a strike that was to begin on March 19 due to price drops, imports and smuggling from Venezuela. The strike was to take place in the

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iv) Business owners in Cucuta (capital city of the state of Norte de Santander – frontier with Venezuela –): Protests and unrest began to boil up in Cucuta when business and commercial activity plummeted after the Venezuelan currency was devalued (40%). Additionally, bilateral agreements between Venezuela and Colombia, aimed at enhancing trade and the economy in the border, have not been implemented (Chavez’s death probably augmented fears that such implementation will never take place). ¡Unemployment in Cucuta stands at 17.8%!


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states of Norte de Santander, Cesar, Arauca, Casanare, Meta, Huila and Tolima (the first three being frontier states with Venezuela). 8,000 farmers were expected to join in. However, on Thursday March 14 the Minister of Agriculture negotiated price bands with rice farmers and extinguished the March 19 strike. No doubt the negotiation was successful in terms of avoiding an additional setback for the Minister. But, at what cost? Note that price bands are isomorphic to price fixation and, thereby, always induce a black market due to scarcity (if the price – or band – is fixed below natural equilibrium) or to oversupply (if the price – or band – is set above natural equilibrium). The latter is the case and the following questions emerge: How are the price bands going to be enforced? How will farmers (enjoying the price band) be chosen by the mills? Who is going to compensate mills for the higher than equilibrium price paid to a few fortunate farmers? Who is going to buy the black market oversupply? Who is going to compensate mills for black market competition at lower than band prices? Who is going to regulate rents obtained by black market players (buying below the price band and selling at higher consumer prices)?

vii) Dairy farmers: Some of their leaders have announced the possibility of initiating a national strike against imports attributable to Free Trade Agreements (FTA) that Colombia has negotiated with several countries (the major fear of dairy producers comes from the FTA with the European Union). Strikes are common in Colombia (and basically in every truly democratic country of the world). However, the problem arises when a government (with downward sloping popularity indexes and incapable of enduring the unrest) handles clumsily every confrontation, thus yielding to earmarks and distortive policies (stimulating, by the way, further strikes and jeopardizing the country’s fiscal stance). Unfortunately, this is not the first wave of social unrest handled by the government by earmarking fiscal income (recall that last year’s judicial national strike ended in a $US 750 million wage leveling package granted by the government – and, ironically, inconformity in judicial employees persists –). • Monday March 11: Cortolima (regional environmental authority) suspended Anglo Gold Ashanti’s exploring and drilling activities in the settlement of Doima – municipality of Piedras (central state of Tolima). The decision was preceded by local protests during Feb (including road blocks to the company’s equipment). Local citizens fear harm against hydric resources in the area where the company must operate.

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Price bands are a costly, exotic and unorthodox response to please the rice sector. They not only add up to the previous collection of costly policies that the government adopted in order to calm down unrest in the Ag sector, but also constitute a very bad signal in terms of investor confidence to any company willing to participate in the Ag sector in Colombia.


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The suspension was based upon the company’s non – compliance of minimal standards when requesting the corresponding environmental permits. Additionally, Cortolima argued that the area where the company was operating is legally destined to agriculture, forestry and peasant housing (not mining activities). Finally, the authority also established that the area is extremely fragile and that Anglo Gold’s activities could endanger its water and soil resources. On Thursday March 15 the Mayor of Ibagué (capital city of the state of Tolima) publicly requested Anglo Gold to resign its 157 mining titles in the areas surrounding the city. The Mayor argued that 25 of those titles are located in the city’s water sources (especially the Combeima River). Anglo Gold Ashanti is a global leader in gold mining, and operates in 13 countries (including the U.S., Australia, Argentina, Brazil and South Africa). On Friday March 15 the company issued a press release saying that it has complied with all legal standards when developing its activities in the state of Tolima. Nobody denies the importance of protecting environmental resources in the country. However, Cortolima’s decision (and the Mayor’s intervention) could be a politically motivated (and politically profitable) first step against the company´s gold mining activities in Colombia (especially against the controversial Colosa project in the municipality of Cajamarca, also in the state of Tolima).

• Thursday March 14: The Ministry of Mines announced that, during Feb, oil production dropped below the 1 million bpd threshold. Indeed, Feb oil production exhibited a 1.42% contraction in relation to Jan (when production averaged 1.012.000.000 barrels per day). The Ministry conceded that the drop is the result of the escalation of terrorist attacks against oil pipelines and infrastructure during this year (especially against the Caño – Limón Coveñas Pipeline). Fortunately, On April 8 the Ministry reported that during March production was back again over de 1 million bpd threshold (and 66k bpd higher than production on Mar 2012). • Thursday March 14: Consejo de Estado (Supreme Court in administrative or public – private matters) issued a ruling against the current owners – investors of the Cartagena building and land piece where Hilton Hotel operates. The ruling demands that: i) The hotel´s beach area be recognized and formalized by authorities as public space (given that, originally, it was low sea water area and was turned into beach with seawalls during the late 1970’s). ii) In compensation for having used the area for so many years, current investors (in the building and the land piece, not Hilton) must buy a piece of land close by

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Because of the politics and protests surrounding the company´s activities in the state of Tolima, the environmental authority’s decision against Anglo Gold Ashanti creates a bitter aftertaste in terms of investor confidence. This episode, isolated as it is, could also be a side effect of enhanced national animosity and contempt against mining activities in Colombia during the last few months.


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(similar in area to the piece being restored as public space), develop a public park, and pay for its maintenance during 30 years(!). However, some of the current investors acquired participation in the building and the land in the early 1990’s (for example Corficolombiana – Hoteles Estelar from the Sarmiento Angulo Group with 50% of shareholding). But note that they are being penalized for seawall installation dating back to the late 1970’s, when investors were completely different and shareholding was controlled by public entities or corporations. In other words, current private investors are being sanctioned for public decisions made more than 30 years ago. Assuming the restoration of Hilton´s beach area as undisputable public space is fair and legal, the court’s penalty and compensation requirement on current investors is completely unfair, exotic and erodes business environment in the tourism sector. • Monday April 1: INCODER (National Rural Development Institute) expropriated 1,200 hectares of land in La Gloria (state of Cesar). The land piece had several palm plantations belonging to foreign and domestic investors. According to INCODER, property rights of the area belong to the Nation and will be entitled to landless peasants. Moreover, according to the institute’s ruling the companies will not be considered occupants in good faith and, therefore, are not entitled to any compensation whatsoever for the loss of their palm plantations. This is one of the biggest setbacks for investor confidence in the Colombian Ag sector. •

Physical Security:

ii) Sunday January 20: FARC terrorist group blew up the Transandino Oil Pipeline in the municipality of Orito (State of Putumayo, frontier with Ecuador), really close to Ecopetrol’s Central Station. The pipeline, 306 kms long between the oil fields of Orito and the municipality of Tumaco (State of Nariño, Pacific coast), has a 48k bpd capacity. According to Ecopetrol, the attack caused an oil spill, a fire and the obvious pumping halt. iii) Monday January 21: FARC terrorists destroyed four tranches or segments of a small oil pipeline that serves different oil fields in the State of Putumayo. iv) Tuesday January 22: FARC terrorists launched a bomb to the train that carries coal from the Cerrejón mine (State of La Guajira, frontier with Venezuela) to port (Puerto Bolívar, Colombian Caribbean Coast). v) Wednesday January 23: FARC terrorists attacked the Caño Limón – Coveñas Oil Pipeline in the municipality of Arauquita (State of Arauca, frontier with Venezuela). There was no oil spill, but pumping had to be suspended. This pipeline, 780 kms long between the Caño Limón oil field in Arauquita and the municipality of Coveñas (State of Sucre, Atlantic coast), belongs to Ecopetrol and Occidental Petroleum Company (American capital) and has a 220 bpd capacity.

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i) Friday January 18: Terrorist group ELN kidnapped one Canadian and two Peruvian nationals (together with three Colombians) in “Casa de Barro” gold mine – municipality of Norosí (south of the State of Bolívar). The mine belongs to Geo Explorer (gold exploration company with Colombian and Canadian capital). The Peruvians and Colombians were liberated on February 12. The Canadian remains captive.


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vi) Friday January 25: A FARC cell blew up a gas pipeline in the state of La Guajira. Gas service had to be suspended in near – by municipalities. vii) Friday January 25: Two policemen and an engineer working for a sugar mill were kidnapped by FARC in the municipality of Pradera (State of Valle, Cauca River valley). The engineer was released some hours later, but the two policemen (who were investigating extortion to sugar factories in the area) were kept in hands of FARC terrorists until February 15. viii) Wednesday January 30: FARC terrorists kidnapped three engineers working for oil company Gran Tierra Energy (Canadian capital) in the municipality of Piamonte (state of Cauca). One day later, the three engineers were set free. ix) Thursday January 31: FARC terrorists killed 4 soldiers in the municipality of Policarpa (state of Nariño). Two other soldiers were seriously wounded in the same attack. x) Friday February 1: FARC terrorists blew up a public elementary school that served 60 poor children in Balsillas, municipality of San Vicente del Caguán (state of Caquetá). xi) Friday February 1: FARC terrorists assassinated three policemen in the municipality of Maicao (state of La Guajira). xii) Friday February 1: Army commanders offered substantial monetary rewards for information leading to the capture or death of FARC leaders in the state of Chocó (Pacific coast). This is due to numerous threats of retaliation from FARC against anyone daring to drive on the roads connecting the central part of the country with the state of Chocó.

In a press release the terrorist group justified the kidnappings claiming they were legitimate acts of war. The cynical statement came a few hours after authorities found the car in which the two policemen were taken away (the car, not surprisingly, was full of explosives and put there as a deadly bait against soldiers participating in the search for the policemen). The soldier was liberated on February 16. xiv) Monday February 4: Two contractors (technicians) working for Ecopetrol in Sucumbíos, municipality of Orito (state of Putumayo), were kidnapped by FARC. xv) Monday February 4: The police Station in the municipality of Nátaga (state of Huila) was attacked by FARC terrorists (¡they drove into town on 6 trucks!). One policeman was shot dead. Several civilians were wounded. xvi) Monday February 4: FARC terrorists killed two policemen in an ambush over the main road connecting Medellin and Urabá (western coastal region in the state of

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xiii) Saturday February 2: FARC admitted having kidnapped not only two policemen in the municipality of Pradera – state of Valle (the ones kidnapped on January 25 and released on February 15, see above), but also one soldier in the state of Nariño.


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Antioquia). It occurred in the municipality of Giraldo. Two other policemen were severely wounded. xvii) Monday February 4: A grenade wounded 4 soldiers who were attending the assassination of an adult civilian (and injuries to a girl) – all attributable to FARC – in the municipality of Ituango (state of Antioquia). xviii) Monday February 4: Terrorist group ELN announced that it had kidnapped two German citizens in the conflictive Catatumbo region (state of Norte de Santander, frontier with Venezuela). The German government refused to negotiate with the terrorist group. They were liberated on March 8. xix) Tuesday February 5: FARC terrorists blew up a car bomb in the municipality of Caloto (state of Cauca). As a result, one soldier and one civilian were killed, while two soldiers were injured. xx) Thursday February 7: FARC terrorists attacked the municipality of Toribío (state of Cauca). xxi) Thursday February 7: In Neiva (state of Huila) FARC terrorists blew up a motorcycle – bomb, destroying 30 houses and injuring a 3 year old girl. xxii) Monday February 11: A 10 year old girl and a policeman were killed by FARC terrorists in the municipality of Miraflores (state of Guaviare). Their modus operandi this time: terrorists initiated a fire and, after local residents arrived at the site to help extinguish it, they threw a grenade and fired upon the people. 15 other civilians were severely wounded.

xxiv) Tuesday February 12: At 8:30 am FARC members of the same terrorist unit (“Frente 49”) blew up 4 trucks that belonged to Cass, a company in charge of paving a road in the Valle del Guamez region (state of Putumayo). xxv) Tuesday February 12: The Metropolitan Bogotá Police Department confirmed that terrorist group FARC was once again extorting businesses and companies in the city. Something like this had not happened in the capital of Colombia for many years. xxvi) Tuesday February 12: FARC terrorists massacred 5 members of a (different) criminal group devoted to extortion and looting in the municipality of El Bagre (state of Antioquia, northeastern mining – gold – region). xxvii) Wednesday February 13: FARC terrorists belonging to its “Bloque Sur” assassinated seven soldiers belonging to the Army’s Sixth Division (and wounded 5 more) in San Antonio de Milán (state of Caquetá). xxviii) Friday February 15: FARC terrorists ambushed and assassinated three Army members (one captain, one corporal and one soldier) in Sumapaz (¡outskirts of Bogotá!). Three more soldiers were wounded.

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xxiii) Monday February 11: At 9:25 pm FARC terrorists belonging to “Frente 49” blew up the Transandino Oil Pipeline in the municipality of Orito (state of Putumayo). It caused not only a big oil spill, but also a fire in the Los Ángeles settlement of the municipality. Several families had to be evacuated from their homes.


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xxix) Friday February 15: FARC terrorists belonging to “Frente 34” fired four 82 mm grenades towards a military base in the municipality of Urrao (state of Antioquia). Two soldiers and one civilian woman were wounded. xxx) Friday February 15: Two soldiers belonging to the Army’s 17th Brigade died due to a FARC minefield between the municipalities of Dabeiba and Mutatá (state of Antioquia). xxxi) Saturday February 16: President Santos travelled to the state of Arauca (frontier with Venezuela), where a FARC – induced strike was taking place (and creating food shortages). xxxii) Saturday February 16: At dawn FARC terrorists blew up a Police Station in the municipality of Puerto Asís (state of Putumayo) wounding one captain and two policemen. 30 homes were damaged. As a result, the Governor of Putumayo demanded from President Santos special and urgent measures to stop further FARC terrorist acts in that state. xxxiii) Sunday February 17: FARC terrorists belonging to “Frente 36” dynamited and destroyed an energy/electricity (transmission) tower in the municipality of Yarumal (state of Antioquia). The tower belonged to EPM (public electrical power company). Several towns in the region, as well as the Hidroituango Project (a dam being built in the Cauca River), had to endure a severe black – out. xxxiv) Sunday February 17: FARC terrorists belonging to “Frente 36” used trucks and other vehicles (apparently full of explosives), and burned a bus, to block all roads leading to the municipality of Ituango (state of Antioquia).

xxxvi) Sunday February 17: A grenade exploded in downtown Yopal (capital of the petroleum producing state of Casanare). It was a retaliation against vehicle sale that didn’t pay what extortionists were demanding. Fortunately, this terrorist act didn’t result in dead or wounded people. xxxvii) Monday February 18: Terrorist groups FARC and ELN (through a press release) jointly declared as military objectives all hydroelectric, mining, timber and bio – fuel projects in the state of Antioquia. xxxviii) Tuesday February 19: At 8:30 am one civilian woman died and three others were severely injured in the municipality of Briceño (state of Antioquia) after a land mine (installed by FARC terrorists the night before) blew up. xxxix) Wednesday February 20: FARC terrorists ambushed with explosives an Army patrol in the municipality of San Vicente del Caguán – state of Caquetá – (several hours before the arrival of the President). One civilian died. xl) Wednesday February 20: Peasants from the Bagadó settlement (state of Chocó) had to flee after violent FARC intimidation and attacks against the Police Station. The

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xxxv) Sunday February 17: FARC terrorists blew up the Caño Limón – Coveñas Oil Pipeline in the municipality of Teorama (State of Norte de Santander, frontier with Venezuela). There was an oil spill that reached the Catatumbo River.


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peasants and their families arrived to the municipality of Pueblo Rico (state of Risaralda). xli) Wednesday February 20: The municipality of Argelia (state of Cauca) was attacked (grenades and assault rifles) by several FARC terrorists belonging to “Frente 60”. Three soldiers and one policeman were wounded. xlii) Thursday February 21: FARC terrorists blocked during three days a road in the municipality of Tuluá (state of Valle del Cauca, Pacific coast and Cauca River valley), using two vehicles with explosives. The terrorists also imposed a 6:00 pm curfew in the surrounding area. xliii) Thursday February 21: FARC terrorists belonging to “Frente 6” blew up the main water conduit of the aqueduct in the municipality of Corinto (state of Cauca). xliv) Saturday February 23: At 3:00 am FARC terrorists attacked Army and Police units in the municipality of Anorí (state of Antioquia). No dead or wounded Army or Police personnel. xlv) Saturday February 23: FARC terrorists intercepted and burned a civilian bus in the municipality of Sabanalarga (state of Antioquia). xlvi) Sunday February 24: FARC terrorists used explosives to blow up 3 Cerrejón trucks. The terrorist attack took place inside the company’s coal production facilities. xlvii) Monday February 25: Military personnel neutralized a car – bomb carrying 8 firing cylinders (of the type used in terrorist attacks) in the municipality of Corinto (state of Cauca), after FARC’s “Frente 6” left it abandoned in the middle of combats with the Army’s “Fuerza de Tarea Apolo”.

xlix) Wednesday February 27: FARC terrorists blew up the Caño Limón – Coveñas Oil Pipeline in the municipality of El Carmen (State of Norte de Santander). The oil spill reached the Carmen River, tributary of the Simaña and Magdalena Rivers. l) Saturday March 2: FARC terrorists attacked and blew up six oil transporting trucks in the municipality of Puerto Asís (state of Putumayo). li) Saturday March 2: At 10:30 am FARC terrorists belonging to “Frente 34” attacked the Police Station in the settlement of Tutunendo (30 minutes away from Quibdó, the capital city of the state of Chocó). Exploding cylinders hit the station and the settlement. lii) Saturday March 2: In the Catatumbo oil producing region (state of Norte de Santander) FARC terrorists (dressed as civilians) burned one truck belonging to a contractor that provided services to Ecopetrol.

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xlviii) Monday February 25: At 12:45 pm FARC terrorists attacked with explosives a restaurant in the municipality of San Miguel (state of Putumayo). One civilian was killed. 14 other persons (6 children, 5 civilian adults and 3 policemen) were injured.


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liii) Monday March 4: FARC terrorist belonging to “Frente 18” attacked (using explosives and short guns) an Army patrol in the municipality of Ituango (state of Antioquia). Two soldiers and two civilians were injured. liv) Tuesday March 5: At 2:00 am FARC terrorist detonated a car – bomb at Ecopetrol’s headquarters in the municipality of Tumaco (state of Nariño). A few minutes later two cylinder – bombs exploded against the town’s Navy base. As a result water and energy supply had to be suspended. lv) Wednesday March 6: ELN terrorists blew up the Caño Limón – Coveñas Oil Pipeline by km 90 (settlement of La Pava, municipality of Saravena, state of Arauca). The fire and oil spill affected several farms. lvi) Thursday March 7: Hooded men massacred three peasants in the municipality of Yondó (state of Antioquia). lvii) Saturday March 9: FARC terrorists detonated a car (full of explosives) in the road that connects the municipalities of Convención and Ocaña (state of Norte de Santander). lviii) Saturday March 9: FARC terrorists blew up an energy tower in the municipality of Tarazá (state of Antioquia). lix) Sunday March 10: Two soldiers were killed and two children were severely wounded after FARC terrorists (belonging to “Frente 18”) activated a land mine in the municipality of San Andrés de Cuerquia (state of Antioquia). The land mine was activated using a cell phone.

lxi) Tuesday March 12: At 6:20 pm FARC terrorists ambushed a Police patrol in the municipality of Salado Blanco (state of Huila). Two policemen were killed and one more was wounded. lxii) Wednesday March 13: At 1:00 pm FARC terrorists (belonging to “Frente 36”) activated an explosive artifact in a rural school in the municipality of Toledo (state of Antioquia). Two soldiers were injured and 50 children were stunned. lxiii) Thursday March 14: ELN terrorists blew up, once again, the Caño Limón – Coveñas Oil Pipeline. This time it was in the municipality of La Gloria (State of Cesar). The oil spill created a severe environmental damage. lxiv) Thursday March 14: FARC terrorists (belonging to “Frente 59”) dynamited in the state of La Guajira the train that transports the coal from the Cerrejón mine to Puerto Bolívar. The explosion, at km 14, derailed 17 wagons and caused severe damages to the railroad. Coal exports were transitorily suspended. lxv) Thursday March 14: FARC terrorists activated an explosive artifact in the municipality of Planadas (state of Tolima). One civilian was killed.

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lx) Monday March 11: At 11:30 am FARC terrorists activated an explosive at the entrance of a supermarket, 50 meters away from the Police Station in the municipality of Timbío (state of Cauca). 15 persons were injured (12 of them being civilians) and 20 buildings were affected after the blast.


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lxvi) Friday March 15: FARC terrorists attacked the municipality of Argelia (state of Cauca). They detonated an explosive in the middle of town, really close to a school. 32 civilians (9 minors) were injured. This was the fifth terrorist attack against this municipality during 2013. lxvii) Friday March 15: FARC terrorists detonated an explosive in Cali (capital city of the state of Valle). 7 civilians were injured. Several buildings and vehicles were also affected. lxviii) Friday March 15: When an Army patrol was passing by, FARC terrorists (belonging to “Frente 36”) used a cell phone to activate a minefield in a region between the municipalities of Anorí and Campamento (state of Antioquia). 9 soldiers were injured. lxix) Monday March 18: FARC terrorists blew up, once again, the Transandino Oil Pipeline. This time it happened in the municipality of Barbacoas (state of Nariño). The attack caused a severe environmental damage and an oil spill in the Ñiambí River. Oil pumping was suspended until Ecopetrol repaired the physical damages to the pipeline. lxx) Monday March 18: FARC terrorists raided the Cerrejón mine in an attempt to blow up some of the company’s heavy machinery and equipment. The Army repelled the attack. In the retreat the terrorists fired their guns against two trucks. One of the drivers and one soldier were injured.

lxxii) Wednesday March 20: FARC terrorists launched an explosive against a Police patrol in the road that communicates Bogotá and Neiva (capital city of the state of Huila). Fortunately the artifact didn’t explode and was properly deactivated by Police anti explosive personnel. lxxiii) Saturday March 23: FARC terrorists (belonging to “Frente 41”) installed an illegal toll in the road connecting the municipalities of Codazzi and Casacará (state of Cesar). The terrorists fired their assault rifles indiscriminately on several cars that were forced to stop. One minor (17 years old) and one adult (36 years old) were killed. Six other civilians were injured. lxxiv) Saturday March 23: One soldier was injured during combats between the Army and FARC terrorists in the settlement of Calamar (state of Caquetá). lxxv) Sunday March 24: FARC terrorists (belonging to the “Jacobo Arenas” column) attacked an Army patrol in the municipality of El Tambo (state of Cauca). The Army lieutenant was killed.

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lxxi) Tuesday March 19: ELN terrorists installed explosives (and their flag) in a major bridge in the middle of Medellín (capital city of the state of Antioquia). At 6:30 am the Police deactivated the artifact which only had 100 grams of the explosive. Nevertheless, it’s the first time in many years that an episode of this sort occurs in the middle of a major Colombian city.


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lxxvi) Thursday March 28: One person (30 year old) was kidnapped in the road between the municipalities of Pitalito (state of Huila) and Mocoa (state of Putumayo). It was the first kidnapping of the year in this southern region of the country. lxxvii) Thursday March 28: One five year old child was severely wounded by an explosive artifact installed by FARC terrorists in the municipality of Orito (and aimed at the Transandino Oil Pipeline). lxxviii) Saturday March 30 FARC terrorists attacked with assault rifles Army troops in the municipality of Turbo (state of Antioquia, Urabá region). One soldier was killed. lxxix) Saturday March 30 Community members in the state of Cesar denounced that FARC’s “Frente 41” was reactivated. It seems to be operating through skirmishes of small squads (5 or 6 members) that install extortion tolls (and set vehicles on fire) in the road that connects the municipalities of Curumaní and La Paz. lxxx) Sunday March 31: At 11:45 am FARC terrorists set fire to an oil truck (belonging to Transkilili) in the Mocoa – Puerto Asís Road (state of Putumayo). lxxxi) Monday April 1: FARC terrorists attacked the workers’ camp in the construction site of La Libertad road, connecting the municipalities of Inzá (state of Cauca) and La Plata (state of Huila). lxxxii) Tuesday April 2: The U.S. government confirmed that FARC has purchased land to air missiles (capable of blowing down aircrafts). lxxxiii) Thursday April 4: FARC terrorists (belonging to “Frente 6”) attacked with explosive the settlement of Guatemala in the municipality of Miranda (state of Cauca). One of the explosives hit a family home. Thus, one civilian was killed and three others (including two children) were injured.

lxxxv) Saturday April 6: 200 FARC terrorists (belonging to “Frente 15”) attacked the Police Station and a military base in the San Antonio de Getuchá settlement (municipality of Milán, state of Caquetá). One corporal and two soldiers were assassinated. Five persons were injured (including two civilians – one of them a minor –). The power station was also destroyed, thus causing an electrical black out in the settlement. Dismal statistics 1: We have reported 85 terrorist acts during the first quarter of 2013 (the average is almost equivalent to 1 terrorist act per day). Dismal statistics 2: 5 employees of the oil industry and 11 employees of the mining sector have been kidnapped in Colombia during 2013. Dismal statistics 3: Terrorist attacks against oil pipelines and energy towers skyrocketed during 2012 (341 vs. 120 in 2011). Higher numbers will come out this year Dismal statistics 4: In terms of attacks against oil pipelines, January of 2013 has been the most violent of all Januaries during a 6 year period (14 attacks vs., for example, 4 attacks in January 2012). Dismal statistics 5: There have been 10 attacks to the Caño Limón – Coveñas oil pipeline during 2013 (3 in Arauca, 6 in Norte de Santander, 1 in Cesar).

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lxxxiv) Friday April 5: FARC terrorists (belonging to “Frente 6”) attacked Army units in the municipality of Corinto (state of Cauca). Four army members (one corporal and three soldiers) were killed, while eight of them were injured.


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Dismal statistics 6: Extortion has skyrocketed all over the country: 1,542 cases were reported to authorities up to November of last year (the real number is probably three to four times higher due to fear of reporting). Our assessment: Physical security and personal safety have deteriorated significantly, especially in frontier states, and in regions of interest to the O&G, Coal, Gold and Electrical Energy sectors. Escalation of terrorist acts in Colombia is not fortuitous. It’s the result of: i) FARC’s evident strategy of enhancing people’s perception of its military capacity during peace talks with the government. FARC is trying to strengthen its stance (and hike up its price value) amid negotiations with President Santos. ii)

ELN’s attempt to induce the government into peace talks.

Keep an eye on peace talks in Cuba between the Santos administration and FARC. Apparently, both sides are close to a deal on the topic of rural development. Nothing good can come out of it for foreign or domestic investment. In fact, the deal includes: i) Increasing land taxes in order to induce a more efficient use of land. That will not do it. On the contrary, it will reduce the feasibility of investment in rural areas.

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ii) Enhancing the (already worrisome and dangerous) legal structure for land expropriation in order to nourish a land bank for poor peasants. That’s a nice intention. Unfortunately, peasants with land but lacking credit, technology, economies of scale and insurance (against exchange rate, climate, phitosanitary and international price risks) usually go bankrupt and abandon (once again) their land to find a job in the city. At the end of the day this policy ends up killing many job creating investment possibilities and sending peasants back to the cities.


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April II Fortnight Monday, April 8 – Monday, April 22 (2013). DATA: Peso – Dollar Exchange Rate (ER) Exchange Rate: Level & Volatility 1825,00

25,00 23,00

Avg. (30 - Day); left axis 1815,00

21,00 1805,00

19,00 17,00

1795,00 15,00 1785,00

13,00 11,00

St. Dev. (45 - Day); right axis

1775,00

9,00

Note that during this year the ER has gone through a trend reversal cycle:

i)

ER (30 – day avg.) January 2 = $1,804.41

ii)

ER (30 – day avg.) February 7 = $1,772.74

iii)

ER (30 – day avg.) April 22 = $1,813.43

• The driving force of such dynamics has been the Feb – Apr 3.5% depreciation (over 60 Colombian Pesos – COP – per $US): i)

ER January 31 = $1,773.24

ii)

ER April 22 = $1,835.57

• For sure, the Feb – Apr depreciation has been a natural market response to the Central Bank’s (CB) loose policy stance (in response to output slow down). •

In fact, the CB has cut its interest rate in 100 basis points (bps) during 2013:

i)

25 bps on Jan 28.

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21/04/2013

09/04/2013

28/03/2013

16/03/2013

04/03/2013

20/02/2013

08/02/2013

27/01/2013

15/01/2013

03/01/2013

22/12/2012

10/12/2012

28/11/2012

16/11/2012

04/11/2012

7,00 23/10/2012

1765,00


Reporte Macroeconómico

ii)

25 bps on Feb 22.

iii)

50 bps on Mar 22 (and the rate is currently standing at 3.25%).

No.59

• Plus, the CB has adopted a more active international reserve accumulation policy: $US 30 million daily (or $US 3 billion between Feb and May), as opposed to the $US 20 million per day it had been purchasing before. •

However, ER dynamics have also been influenced by exogenous factors:

i) FED signaling less Quantitative Easing (QE) due to output data revealing a bit of economic recovery in the U.S. (though not as much as expected according to April 5’s job creation report). ii) Uncertainty in Europe (Italy, Spain, Greece, and Cyprus) has triggered risk aversion, thus inducing short term capitals to flee from emerging markets and into safe havens (like US T Bills). • Yet, there’s no significant evidence yet of an inflection point in the 30 – day ER average so as to predict comfortably that the current level is a max and that it will converge back to the $1,800 threshold. • In fact, if output slowdown (inducing more CB loosening), adverse shocks to business environment (see below), and external shocks to the ER (less QE, more uncertainty in world markets, etc.) continue to kick in, current ER levels might remain in place for a while. • Hence, at this point we suggest caution before adopting a final stance on the future trend of the ER (which could be depreciation – like).

• Additionally, depreciation melts down the real (dollar) value of any foreign investor’s net worth (that´s why we never understood the Minister of Finance’s yearning for a $1,950 ER). • In terms of ER volatility, the cycle is as follows: skyrocketed during January, plummeted during February, picked up again during March, and is converging back to below average levels during April: i)

St Dev. (45 – day avg.) January 2 = $16

ii)

St Dev. (45 – day avg.) January 23 = $23

iii)

St Dev. (45 – day avg.) February 25 = $11

iv)

St Dev. (45 – day avg.) March 8 = $17

v)

St Dev. (45 – day avg.) April 22 = $14

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• If so, don’t forget that the systematic and steady depreciation of any currency is not a good symptom of confidence in the economy´s environment. On the contrary, it reflects a reduction in the demand for (or confidence in) its currency.


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In sum, ER volatility seems to be converging back to its 10 – 11 peso minimum.

• Moreover, ER volatility is quite below its highest level. The max levels have been: i)

$23 during the first quarter of 2013 (Jan).

ii)

$27 during the second half of 2012.

iii)

$61 (!!!) during the first half of 2012.

• Hence, it should be a good time for tradable sector companies to purchase hedges against ER fluctuations. • Remember: the higher the volatility, the more expensive the hedging. Don´t wait for volatility to pick up again. QUAESTOR’s $US Value of Domestic Stock Price Index $US Value of Stock Prices 107,00

105,00

103,00

101,00

99,00

95,00

18/04/2013

08/04/2013

29/03/2013

19/03/2013

09/03/2013

27/02/2013

17/02/2013

07/02/2013

28/01/2013

18/01/2013

08/01/2013

29/12/2012

19/12/2012

09/12/2012

29/11/2012

19/11/2012

09/11/2012

30/10/2012

20/10/2012

93,00

• The Colombian stock market went through a boom – bust cycle during the first quarter of 2013. • 30 – Day avg. gains (as measured by our index) peaked at 5% on Feb 15, but vanished completely after that, and prices (in dollar terms) are currently 5% below 2012 levels. •

This is a 10% average loss (in dollar terms) from peak to through.

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97,00


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• Furthermore, after its Feb 5 max (15,195), the main index (IGBC) plummeted and dropped below the 14,000 psychological threshold during the last week of March (and throughout April): i)

IGBC February 5 = 15,195

ii)

IGBC March 1 = 14,786

iii)

IGBC March 22 = 13,984

iv)

IGBC April 12 = 13,661

v)

IGBC April 19 = 13,315

This is a 14% (COP) nominal drop.

• As a result, the severe price plunge that has taken place between February and April (14% nominal drop), coupled with the 4% Feb – Apr COP depreciation (totaling an 18% dollar value loss), has wiped out the original Jan to mid – Feb real gains (5%) and added an additional 13% dollar value loss. •

In fact: $US 100 invested in on Jan 02 have become $US 87 on Apr 19.

Our diagnosis:

1.

Traded volumes have been 20% below those of 2012.

2. Dismal corporate results: only 57% of those companies listed in the IGBC reported profit growth.

4. GEA group announced more stocks to be issued for Cementos Argos and Bancolombia (price reduction due to expected increase in supply). 5.

Recent deterioration of business environment in Colombia (see below).

6. Consistently loose monetary policy (attributable to domestic output slowdown) depreciating the COP (see above). 7. Uncertainty in Europe + mild recovery in the U.S. has induced higher relative risk premiums in emerging markets (so capitals flee to safe havens). •

In sum, we believe the market will remain bearish in the medium – run.

Treasury Bills (TES) Implicit Interest Rates • Implicit interest rates on the July 2020 TES bond (11% coupon, issued on July 24 2005, expire on July 24 2020) exhibited a downward sloping trend until the first week of March:

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3. Disappointing data from oil and gas sector (O&G) companies: less than expected reserves, production and profits. O&G companies represent 23% of the COLCAP Index (capitalization weighted average index of companies with high liquidity levels).


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TES 2020 Implicit Rate 5,80%

5,60%

5,40%

5,20%

5,00%

4,80%

i)

TES Rate January 3 = 5.39%

ii)

TES Rate March 7 = 4.68%

That’s a 71 bps drop.

17/04/2013

10/04/2013

03/04/2013

27/03/2013

20/03/2013

13/03/2013

06/03/2013

27/02/2013

20/02/2013

13/02/2013

06/02/2013

30/01/2013

23/01/2013

16/01/2013

09/01/2013

02/01/2013

26/12/2012

19/12/2012

12/12/2012

05/12/2012

28/11/2012

4,60%

• This means that, as in the stock market, Treasury bond prices have also dropped but, in contrast to the stock price plunge, the T – bond price drop seems to have stopped. Inflation Rate • On Friday April 5 DANE (National Statistics Agency) published inflation data for March 2013: 0.21% (vs. 0.12% on Mar 2012). •

Hence: i) ii) iii) iv)

Cumulated inflation (Jan – Mar) stands at 0.95% (compared to 1.47% during Jan – Mar 2012). ii) Annual inflation (Apr/2012 – Mar/2013) is at 1.91% (compared to 3.40% during Apr/2011 – Mar/2012). • Fortunately, consumer price data reflects full stability in price behavior and portrays sufficient macro/monetary stability for investment purposes. • On the other hand, inflation data might also be revealing domestic economic deceleration and aggregate demand weakening.

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• However, the rate has been fluctuating between 4.80% and 5% during April (Avg. = 4.92%).


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Inflation 1,00%

0,04 0,035

0,80%

Annual; right axis

0,03

0,60%

0,025

Monthly; left axis

0,40%

0,02 0,015

0,20%

0,01 0,00%

0,005

Feb 2013

Mar 2013

Jan 2013

Dec 2012

Oct 2012

Nov 2012

Sep 2012

Aug 2012

Jul 2012

Jun 2012

Abr 2012

May 2012

Mar 2012

Jan 2012

Feb 2012

Dec 2011

Oct 2011

Nov 2011

Sep 2011

Jul 2011

Aug 2011

Jun 2011

Abr 2011

May 2011

Mar 2011

Jan 2011

0 Feb 2011

-0,20%

Output Performance • Recent relevant data: i) Tuesday April 9 (DANE): 6.6% reduction in total exports during Feb 2013 (yoy): $US 4,668 million on Feb 2013 vs. $US4.993 million on Feb 2012. The contraction is due to a $US 360 million (51.8%) reduction in coal exports attributable to: a.

31 day long (Feb 7 – Mar 11) labor strike in Cerrejón .

c. 21 day long (Feb 7 – Mar 1) suspension of FENOCO’s daily night time (10:30 pm – 4:30 am) operation . Cumulated exports (Jan + Feb) stand at $US 9,452 million. This represents a $US 333 million or 3.4% drop with respect to the same time period of 2012. This contraction is basically explained by a $US 440 million or 6.5% drop in O&G and mining sector exports: $US 6,296 million (Jan + Feb 2013) vs. $US 6,736 million (Jan + Feb 2012). ii) Tuesday April 9 (Fedesarrollo): The Consumer Confidence Index dropped 9.6 percentage points during Mar 2013 (yoy), reaching 14.8%. According to the think tank, despite the yoy drop, overall consumer confidence remained stable during Mar and Feb (recall that the index was at 14.9% during Feb 2013). The strongest yoy drops occurred in Bogotá and Cali (in both cities the index dropped below the level registered during Mar of the previous 3 years). Additionally, willingness to buy vehicles keeps on falling. iii) Thursday April 11 (Fenalco): The President of Fenalco (National Retail Sales Federation) forecasted zero growth in retail sales during QI of 2013. He attributed his

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b. 21 day long (Feb 7 – Mar 1) suspension of Drummond’s license for loading coal in its Santa Marta and Ciénaga port (after the coal ocean spill incident) .


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dismal augur to the 26% drop in vehicle sales during the first three months of the year (as well as strong declines in sales of records, stationary and other sectors). iv) Thursday April 18 (DANE): 0.7% yoy drop in imports during Feb 2013: $US 4,497 million (Feb 2013) vs. $US 4,528 (Feb 2012). Imports of agricultural products and foodstuffs contracted 6.4%. Manufacturing imports fell at a 0.5% rate. However, cumulated imports (Jan + Feb) increased 9%: $US 9,698 million (Jan + Feb 2013) vs. $US 8,898 million (Jan + Feb 2012). This jump is attributable basically to a 7.9% increase in manufacturing imports during the first two months of the year. 29.4% of all Jan + Feb imports originated in the U.S. (16.6% in China and 8.5% in Mexico). v) Thursday April 18 (DANE): Cumulated (Jan + Feb) $US 222.6 million trade surplus. The highest surpluses are with Netherlands ($US 374 million), U.S. ($US 373 million), and Venezuela ($US 279 million). The largest deficits are with Mexico ($US 666 million) and China ($US 529 million). vi) Friday April 19 (DANE): 0.6% yoy increase in retail sales during Feb 2013 (last year: 9.2%). If vehicle sales are excluded, the growth rate is just 2.9%. Fortunately, the sector also exhibited a 4.5% yoy increase in jobs during Feb. Cumulated 2013 sales (Jan + Feb) grew a meager 1%. 12 – Month sales (Mar 2012 – Feb 2013) grew a modest 2.2% (last year: 9.6%). vii) Friday April 19 (DANE): Manufacturing output plummeted 4.5% (yoy) during Feb 2013 (last year: 4.9% increase). 34 subsectors (out of 48) exhibited output contractions. As a result, the overall manufacturing sector exhibited a 2.5% yoy drop in jobs during Feb.

• Tradable sector output stagnation is reflected in output and export performance. •

Additionally, consumer confidence continues to deteriorate (yoy).

• FDI deceleration? Recall trade surpluses are equivalent to less foreign savings flowing in. • On April 15 the government revealed a $US 2.7 billion (1% of GDP) policy package (named PIPE) aimed at boosting tradable sector output (agriculture + manufacturing sectors) and consumption. The plan includes: i) Government saving additional resources abroad (induces more depreciation of the COP). ii) Anticipation of the 2012 tax reform benefits for labor intensive sectors (alleviates the agriculture and manufacturing sectors’ cash flow) .

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Cumulated 2013 output (Jan + Feb) contracted 3.1% (last year: 3.5% increase). 12 – Month output (Mar 2012 – Feb 2013) dropped 1% (last year: 4.5% increase).


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iii) Tax withholdings reduction for the manufacturing, agricultural and retail sales sectors (alleviates the sectors’ cash flow). iv) 50% time reduction for refunds of value added tax to the manufacturing sector (alleviates the sector’s cash flow). v) 2 more years of zero - tariff on manufacturing inputs not produced domestically (increases the sector’s competitiveness). vi)

Waiting time reduction at port (increases competitiveness of exports).

vii)

Energy cost reductions (increases competitiveness).

viii) Custom reforms aimed at law enforcement against smuggling (reduces competition). ix)

2,500 additional policemen and soldiers (increases security of investment).

x) Additional budget for public roads and highways (increases competitiveness in the long run). xi) Subsidies for mortgage rates in houses costing between $US 44k and $US 110k (stimulates the housing/construction sector, creates jobs and boosts private consumption).

• Unfortunately, the government has shown very little capacity of executing and implementing effective counter cyclical fiscal policies (such as the PIPE plan) to offset any further deceleration of the economy. UNDER OUR WATCH: • Wednesday April 10: INCODER (National Institute of Rural Development) began to study the piece land where “Los Ciruelos” is (or was?) to be developed ($US 7 million hotel project in the Tayrona National Park, state of Magdalena: 24,000 mts2, 12 eco – cabins, 2 docks, etc.). INCODER aims at expropriating some (or all?) of the land under the argument that it belongs to the State. Meanwhile, ANLA (National Agency of Environmental Licenses) extended the suspension of the environmental license for the project’s development. In this case, legal and property rights are being openly ignored due to ideological/political issues. In fact, this decisiveness comes after President Santos announced on January 14 that the project (despite having a proper environmental license) would not be permitted under his administration due to new environmental considerations and indigenous rights (as if he could do that). Yet, when the central government fuels public feelings against investment in (politically or ideologically) sensitive sectors, public officials feel free to validate them, thus expelling environmentally responsible investors and attracting illegal activities. • Wednesday April 10: The President of the Colombian Chamber of Mining reminded the government that Colombia is not a world leader in mining activities due

Página 42 – Reporte Macroeconómico N° 59

xii) Cheap 15 – year loans for agricultural infrastructure (increases the sector’s competitiveness).


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to the lack of FDI in the sector. In fact, Colombia occupies only fifth place globally in coal production and doesn’t even classify among the top ten gold producing nations (Colombia is only a world leader in emerald production). Moreover, the latest data shows that FDI in mining has dropped 20.4% during this year. The Chamber also warned that this year’s first quarter mining exports will be reduced (with respect to last year’s $US 12,523 million). We agree with the Chamber’s assessment. Several factors are hurting FDI in mining: i) Enhanced animosity, contempt and fire from public opinion leaders and public officials against FDI in mining. Recall, for example, from our previous reports: a. Outbursts and publicized decisiveness of the Minister of Environment, Attorney General, and General Comptroller against Drummond after the unfortunate coal ocean spill incident. b. Systematic persecution from environmental authorities and local officials against Anglo Gold’s exploration activities (see also below). ii) Systematic deterioration of physical security in the mining sector. See, for example, in our previous reports: a.

Multiple FARC attacks against Cerrejón’s infrastructure.

b. Multiple kidnappings of mining companies’ workers (Braeval, Grand Tierra Energy, etc.) iii)

Legal instability. Note in our previous reports:

b. Last year’s tax reform increases taxes on capital intensive sectors (i.e. mining, O&G) • Wednesday April 10: Anglo Gold Ashanti (South African capital) publicly denounced that Cortolima’s decision (March 11 ) to suspend the company’s exploring and drilling activities in the municipality of Piedras (state of Tolima) was arbitrary and illegal. According to the company, the environmental authority is requesting permits that are not required for the type of studies being undertaken in Piedras. Anglo Gold Ashanti is a global leader in gold mining, and operates in 13 countries (including the U.S., Australia, Argentina, Brazil and South Africa). Recall (see our 11/03/2013 – 26/03/2013 report) that the suspension was based upon the company’s supposedly non – compliance of minimal standards when requesting the corresponding environmental permits. Additionally, the environmental authority argued that the area where the company was operating is legally limited to agriculture, forestry and peasant housing (not mining activities). Finally, the authority also established that the area is extremely fragile and that Anglo Gold’s activities could endanger its water and soil resources.

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a. Constitutional Court’s ruling in the sense that the Mine Code is unconstitutional due to lack of consultations with indigenous minorities. If an extension of the due date for consultations with such groups is not granted by the Court, legal instability will deepen in the mining industry.


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The decision was preceded by local protests during Feb (including road blocks to the company’s equipment). Local citizens fear harm against hydric resources in the area where the company must operate. To make things worse, on Thursday March 15 the Mayor of Ibagué (capital city of the state of Tolima) publicly requested Anglo Gold to resign to its 157 mining titles in the areas surrounding the city. Because of politics and protests surrounding the company´s activities in the state of Tolima, and given the company’s reasonable complaints, it seems that Cortolima’s decision (and the Mayor’s outburst) was ideologically motivated (and politically profitable), as well as a strong blow against the company´s gold mining activities in Colombia (including the controversial Colosa project in the municipality of Cajamarca, also in the state of Tolima). Here we have a major (and senseless) setback for investor confidence in the mining sector. Of course, nobody denies the importance of strictly safeguarding and protecting environmental resources. Furthermore, nobody disqualifies reasonable doubt in any local community watching drilling activities being undertaken by a foreign company. However, official persecution against environmentally responsible companies is the worst environmental policy whatsoever: it induces environmentally rigorous companies to flee, thus attracting illegal (and environmentally razing or scorching) operators to mining areas. •

Physical Security:

ii) Wednesday April 10: Terrorist group ELN conditioned the release of Canadian geologist Jernoc Wobert to the return of all mining titles by Braeval Mining Corporation (Canadian capital with gold exploration and development projects in Colombia, México and Perú). The terrorists also threatened that any military operation aimed at rescuing Wobert is “unfeasible”. ELN is demanding Braeval’s resignation to mining titles in Mina Seca (1,527 hectares), La Nevera (880 hectares), Casa de Barro (200 hectares) and Las Nieves (36 hectares). Recall that ELN kidnapped one Canadian and two Peruvian nationals (together with three Colombians) in “Casa de Barro” gold mine – municipality of Norosí (south of the state of Bolívar). The Peruvians and Colombians were liberated on February 12. The Canadian remains captive. iii) Wednesday April 10: At 4:30 pm one Army sergeant and one soldier were assassinated by FARC terrorists in the municipality of Arauquita (state of Arauca, frontier with Venezuela). This time the terrorists’ modus operandi was an ambush with an explosive artifact. One corporal and another soldier were also injured in the attack. iv) Friday April 12: During an engagement between the Army (Sixth Division) and FARC (“Columna Móvil Teófilo Forero”) in the settlement of Los Andes (municipality of

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i) Thursday April 9: FARC terrorists blew up the Transandino Oil Pipeline in the settlement of Valle de Las Palmeras (municipality of Orito, state of Putumayo, frontier with Ecuador). The pipeline, 306 kms long between the oil fields of Orito and the municipality of Tumaco (state of Nariño, Pacific coast), has a 48k bpd capacity. According to Ecopetrol, the attack caused an oil spill in the Sucio River (tributary of the Guamez River) and the obvious pumping halt.


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Puerto Rico, state of Caquetá, traditional stronghold of FARC) three soldiers and five terrorists were killed. v) Wednesday April 17: At 4:00 pm FARC terrorists attacked with assault rifles the Police Station in the settlement of Barragán (municipality of Tuluá, state of Valle). vi) Thursday April 18: At dawn FARC terrorists attacked with explosive artifacts two spots in the municipality of Tumaco (state of Nariño, Pacific coast): the airport (and antinarcotic base) and one Police Station (where one car with 30 kg of explosives was also deactivated). vii) Thursday April 18: At 10:00 pm FARC terrorists (“Frente 36”) used a bus (with explosives) to block the road that connects Medellín with the municipality of Anorí (state of Antioquia). Personnel from the Army’s 14th Brigade deactivated the explosives. Our assessment: Physical security and personal safety keep on deteriorating significantly, especially in frontier states, and in regions of interest to the O&G, Coal, Gold and Electrical Energy sectors. Escalation of terrorist acts in Colombia is not fortuitous. It’s the result of: i) FARC’s evident strategy of enhancing people’s perception of its military capacity during peace talks with the government. FARC is trying to strengthen its stance (and hike up its price value) amid negotiations with President Santos. ii)

ELN’s attempt to induce the government into peace talks.

Keep an eye on peace talks in Cuba between the Santos administration and FARC. Apparently, both sides are close to a deal on the topic of rural development. Nothing good can come out of it for foreign or domestic investment. In fact, the deal includes:

ii) Enhancing the (already worrisome and dangerous) legal structure for land expropriation in order to nourish a land bank for poor peasants. That’s a nice intention. Unfortunately, peasants with land but lacking credit, technology, economies of scale and insurance (against exchange rate, climate, phitosanitary and international price risks) usually go bankrupt and abandon (once again) their land to find a job in the city. At the end of the day this policy ends up killing many job creating investment possibilities and sending peasants back to the cities.

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i) Increasing land taxes in order to induce a more efficient use of land. That will not do it. On the contrary, it will reduce the feasibility of investment in rural areas.


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INDICADORES ECONÓMICOS Periodo

Último dato

Dato anterior

Un año atrás

Indicadores Locales Producción Industrial - YoY (% - sin café) Ventas del Comercio minorista - YoY (%) Desempleo Total Nacional (% ) Licencias de construcción (m2) Inflación (% Mensual) Crecimiento - YoY (%) Cuenta Corriente (Millones USD) Balanza Comercial (Millones USD - FOB) Exportaciones (Millones USD - Mes) Importaciones (Millones USD - Mes) Tasa Repo (%) DTF (%) Tasa de cambio real Tasa de cambio nominal

Enero Diciembre Marzo Marzo Marzo IV Trim 12 IV Trim 12 Enero Enero Enero Marzo Marzo Marzo Marzo

-1.7 1.3 11.8 2101 0.2 3.1 -3,577 -164 4,784 5,201 3.3 4.6 129.09 1,832.2

-3.0 3.6 12.1 2010 0.4 2.7 -3,461 699 4,954 4,480 3.8 4.8 128.80 1,816.4

2.0 4.8 12.5 1426 0.1 6.6 -3,125 624 4,786 4,370 5.4 5.3 125.40 1,792.1

-0.2 1.8 7.6 0.3 0.28

0.7 1.7 7.7 0.3 0.29

0.3 2.4 8.2 0.3 0.47

1.7 -0.2 12.1 0.2 0.75

1.8 -0.6 12.0 0.2 0.75

2.7 -0.1 11.0 0.8 1.00

0.5 1.4 5.7

0.6 0.9 5.6

0.2 1.4 6.2

0.7 0.8 4.5

0.5 0.5 4.9

0.1 0.1 4.6

2.7 5.5 7.7

1.4 5.5 7.6

1.0 4.9 7.9

Indicadores Internacionales EE.UU. Inflación - MoM (%) Crecimiento - YoY (%) Desempleo - (%) Total Nacional Tasas de Referencia de la FED (%) US/Libor a 90 días Zona Euro Inflación - MoM (%) Crecimiento - YoY (%) Desempleo - (%) Total Nacional Tasas de Referencia BCE (%) Euribor a 90 días Brasil Inflación - MoM (%) Crecimiento - YoY (%) Desempleo - (%) Total Nacional México Inflación - MoM (%) Crecimiento - YoY (%) Desempleo - (%) Total Nacional Venezuela Inflación - MoM (%) Crecimiento - YoY (%) Desempleo - (%) Total Nacional

Marzo I Trim 13 Marzo Marzo Marzo Marzo I Trim 13 Marzo Marzo Marzo Marzo IV Trim 12 Marzo Marzo I Trim 13 Marzo Marzo IV Trim 12 Marzo

Mercado Cambiario Real/USD PesoMex/USD USD/Euro USD/Libra Yen/USD * Fuente Datos: Bloomberg

Marzo Marzo Marzo Marzo Marzo

2.02 12.33 1.28 1.52 94.22

1.98 12.78 1.31 1.52 92.56

1.83 12.81 1.33 1.60 82.87


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Noticia del Mes Los indicadores que permiten conocer el comportamiento de la actividad industrial en Colombia llevaban varios periodos con resultados desalentadores. Sin embargo, las políticas del gobierno nacional parecieran supeditarse a las actuaciones del Banco de la República, en especial en materia de control de la revaluación del peso colombiano frente al dólar norteamericano. Por ello, fue de vital importancia el anuncio del plan de impulso a la productividad y al empleo (denominado PIPE por el Señor Presidente de la República), el cual ataca de frente los problemas, que en materia económica, afectan al país.

Por otra parte, se incluye dentro del PIPE un plan ambicioso para despertar al sector de la construcción mediante estímulos a los compradores de vivienda en los estratos 1 al 4. Tal vez, el mecanismo más ambicioso es la propuesta de subsidiar la tasa del crédito hipotecario en casi un 50%. Adicionalmente, se incluyen algunas partidas del presupuesto nacional para mitigar los efectos no deseables que se han cernido sobre el sector agropecuario colombiano. En resumen, las medidas eran esperadas y son bienvenidas, aunque se hayan puesto en duda la pronta entrada en vigencias. Sin embargo, ha salido del sector financiero colombiano la primera mano para estimular la compra de vivienda y se anunciaron reducciones en las tasas del crédito de consumo.

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En efecto, el PIPE pretende estimular la productividad a partir de una política cambiaria que busque devaluar la moneda a través de la reducción de empréstitos internacionales por parte de gobierno nacional central y de mayores inversiones de parte de los fondos de pensiones y cesantías, que de acuerdo con los estimativos del Ministerio de Hacienda implicarían intervenciones tan importantes como las compras diarias de dólares realizadas por el Banco de la República. Por otra parte se propone reducir los costos de transporte vía reposición del parque automotor (chatarrización), mientras se culminan las obras que se vienen adelantando en materia de conexión entre los centros de producción, distribución y consumo. Además, se propone reducir los costos de la energía. Todas estas medidas se esperan mejoren la situación del sector productivo.


Colombia 360