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Our Newsletter. Mexico & Latin America. August 2020.

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Nuricumbo + Partners is specialized on subjects such as financial due diligence for M&A, special audits, independent process assessments, debt/equity solutions, on-demand financial talent, anti-corruption initiatives, enterprise risk management, and corporate governance. We have become trusted business advisors for companies of all sizes, providing direct support to CEOs and CFOs in special or confidential projects.

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Our Newsletter. Mexico & Latin America. August 2020.

  1. 1. LATIN AMERICA UPDATE August 2020 www.nuricumbo.com
  2. 2. History is not favorable to the popularity of the U.S. in Latin America
  3. 3. Successful economic policies have reduced migration from Latin America in past 20 years
  4. 4. Trump’s international policies have been controversial
  5. 5. Around the world, views of US President and US Country have decoupled
  6. 6. Latino vote in the US consolidating as an influential force
  7. 7. Size of the Latino vote has almost doubled in 20 years
  8. 8. New ways of influencing the Latino vote from abroad are being explored
  9. 9. Democracy is not perfect, but it is the best we have for now
  10. 10. WE ARE NURICUMBO + PARTNERS
  11. 11. OUR VALUE PROPOSITION: ü Highly experienced consultants. ü High degree of flexibility. ü Ideal to tackle those important but not urgent tasks that otherwise never get done. ü Able to support in the resolution of special or confidential projects. ü Important specialization in Finance and Accounting projects. ü More than 50 multidisciplinary consultants. Average of 15 to 20 years of professional experience. We are Nuricumbo + Partners
  12. 12. SOME EXAMPLES: ü Interim C-Level Executives. ü Financial Due Diligence for M&A. ü Part-Time CFOs. ü Comisarios / Consejeros. ü Interim Project Teams. ü Specialized Training Programs. ü Debt/Equity Solutions. ü Fintech Trusts (Fideicomisos) ü Process Improvement ü Special Audits (Forensic, Compliance, etc.) How do we help some of our clients
  13. 13. More Information: contacto@nuricumbo.com / www.nuricumbo.com First-hand knowledge of business environment Our business DNA is Mexico. Our Firm has extensive experience working with multionationals and local companies all across the country. 40+ 1 20+ Translators of local language and culture We can facilitate productive cooperation between parent and subsidiary. We understand corporate requirements as well as local business practices. We can be your eyes and ears in the field Taking the correct business decisions is never easy. We can provide you with the business intelligence you need to be successful in Mexico. ROME Do you need support with your operations in Mexico? Mexic City Multi-disciplinary consultants Average years of work experience Objective: Supporting your Company What can we do for your company - Interim Management - Fraud Investigations - Financial Due Diligence - Business Process Outsourcing - Debt/Equity Solutions - Trust Management - Tax Advice - Special Audits
  14. 14. Interim Teams for Latam YOUR TRUSTED BUSINESS ADVISORS What can we bring to the table: - Consultants with more than 20 years of experience. - Fully bilingual. - Expert knowledge of business practices in the region. - Flexible business model. - We all have worked for multinationals operating in Latam. WE CAN PROVIDE EFFECTIVE AND EXPERIENCED INTERIM TEAMS TO TACKLE SPECIAL OR CONFIDENTIAL PROJECTS IN LATIN AMERICA. Our consultants bring additional capacity in order to tackle projects and initiatives in the region, without having to distract your internal resources from other priorities. 1 4 Our typical projects include Financial or Operational Audits, Business Process Assessments, Process Improvement, System Implementations, Anti-Corruption Initiatives, Forensic Investigations, Interim Management Positions, among others.
  15. 15. Complete Profiles Armando NuricumboRodrigo Llanos Miguel Amador Guillermo Lagos Former CFOFormer Investment Banking Former Controller / Auditor Former CEO Jesus Bush PWC. IPG. Bombardier. RGP. 25 years of experience. Valmex. Inverlat. Arka. 35 years of experience. Whirlpool. Banco Azteca. 35 years of experience. EY. Smurfit. Maxcom. Devlyn. 30 years of experience. 3M. Imperial Chemical. IMEF 30 years of experience. Some of our talented consultants Alejandro Rico Tax Partner KPMG. Confies. 25 years of experience. Jose Trevino Former NAFTA Negotiator Colmex. Comce. Cancham. 35 years of experience. Angel Hernandez Former CFO Ingram. Dresser. TRW. 35 years of experience. Roberto Fernandez Former CIO AT&T Capital. CIT. Alta. 30 years of experience. Enrique Ugarte Former VP ProMexico. CCE. Edomex. 35 years of experience. Former CIO Marisol Baca Former VP Administration CFE. BID. Real Financiera. 25 years of experience. José A. Ventura Former CFO PWC. Truper. BristolMyers. 30 years of experience.
  16. 16. LATIN AMERICA OVERVIEW
  17. 17. $5.34 $5.47 $5.22 $0.00 $1.50 $3.00 $4.50 $6.00 May June July Brazil Exchange Rates $3,730.76 $3,758.06 $3,732.71 $0.00 $1,500.00 $3,000.00 $4,500.00 May June July Colombia $22.18 $22.99 $22.28 $0.00 $10.00 $20.00 $30.00 May June July Mexico $3.43 $3.54 $3.53 $0.00 $1.00 $2.00 $3.00 $4.00 May June July Peru Source: Bloomberg, 2020. *USD / PEN *USD / MXN *USD / CLP *USD / BRL *USD / COP $806.47 $821.24 $757.73 $0.00 $200.00 $400.00 $600.00 May June July Chile *USD / CLP $68.53 $70.46 $72.32 $0.00 $25.00 $50.00 $75.00 $100.00 May June July Argentina *USD / ARS
  18. 18. Source: Argentina, Brazil, Colombia, Chile, Mexico and Peru Central Banks, 2020. 45.60% 43.40% 42.80% 0.00% 20.00% 40.00% 60.00% April May June Argentina Inflation Rate 2.05% 2.35% 2.69% 0.00% 1.50% 3.00% May June July Brazil 2.85% 2.19% 1.97% 0.00% 1.00% 2.00% 3.00% 4.00% May June July Colombia 2.80% 2.60% 2.50% 0.00% 1.00% 2.00% 3.00% May June July Chile 2.84% 3.30% 3.62% 0.00% 1.50% 3.00% 4.50% May June July Mexico 1.78% 1.60% 1.86% 0.00% 0.90% 1.80% 2.70% May June July Peru
  19. 19. $42,748 $43,219 $43,374 $0 $15,000 $30,000 $45,000 $60,000 May June July Argentina International Reserves $343,165 $339,317 $345,706 $0 $120,000 $240,000 $360,000 $480,000 April May June Brazil $53,863 $56,362 $56,624 $0 $18,000 $36,000 $54,000 $72,000 April May June Colombia $36,756 $36,390 $36,851 $0 $13,000 $26,000 $39,000 $52,000 May June July Chile $187,316 $188,942 $197,891 $0 $60,000 $120,000 $180,000 $240,000 May June July Mexico $73,439 $71,450 $74,336 $0 $20,000 $40,000 $60,000 $80,000 May June July Peru *Million U.S. Dollars *Million U.S. Dollars *Million U.S. Dollars *Million U.S. Dollars *Million U.S. Dollars *Million U.S. Dollars Source: Argentina, Brazil, Colombia, Chile, Mexico and Peru Central Banks, 2020.
  20. 20. 37,824.73 38,686.69 49,253.62 0 12,000 24,000 36,000 48,000 May June July Argentina Capital Markets 87,402.60 95,055.80 102,912.20 0 30,000 60,000 90,000 120,000 May June July Brazil 1,095.84 1,111.80 1,134.34 0 500 1,000 1,500 2,000 May June July Colombia 15,580.85 16,878.00 17,512.53 0 7,000 14,000 21,000 May June July Peru 36,122.73 37,716.43 37,019.68 0 15,000 30,000 45,000 May June July Mexico 3,647.60 3,959.02 4,017.08 0 1,200 2,400 3,600 4,800 May June July Chile *IPSA:IND *MEXBOL:IND *SPBLPGPT:IND *MERVAL:IND *IBOV:IND *COLCAP:IND Source: Bloomberg, 2020.
  21. 21. Foreign Direct Investmet $11,517 $11,873 $6,244.42 $0 $4,000 $8,000 $12,000 2017 2018 2019 Argentina $68,885 $78,162 $78,559 $0 $30,000 $60,000 $90,000 2017 2018 2019 Brazil $13,836 $11,535 $14,493 $0 $5,000 $10,000 $15,000 $20,000 2017 2018 2019 Colombia $12,135 $5,852 $6,082 $0 $4,000 $8,000 $12,000 2016 2017 2018 Chile $32,977 $38,644 $28,881 $0 $12,000 $24,000 $36,000 $48,000 2017 2018 2019 Mexico $6,739 $6,860 $6,487 $0 $3,000 $6,000 $9,000 2016 2017 2018 Peru *Million U.S. Dollars at Current PricesSource: The World Bank, 2020.
  22. 22. Credit Ratings Argentina RD (26 May 2020) Source: Fitch Ratings, 2020 Brazil BB- With NEGATIVE Outlook (5 May 2020) Colombia BBB- With NEGATIVE Outlook (1 April 2020) Chile A- With NEGATIVE Outlook (12 March 2020) Mexico BBB- With STABLE Outlook (15 April 2020) Peru BBB+ With STABLE Outlook (3 June 2020)
  23. 23. Credit Ratings Argentina Ca With NEGATIVE Outlook (3 April 2020) Source: Moody’s Investors Service, 2020. Brazil Ba2 With STABLE Outlook (15 May 2020) Colombia Baa2 With STABLE Outlook (23 May 2019) Chile A1 With STABLE Outlook (26 Julio 2018) Mexico Baa1 With NEGATIVE Outlook (17 April 2020) Peru A3 With STABLE Outlook (25 Jun 2019)
  24. 24. Credit Ratings Argentina SD (28 July 2020) Source: Standard & Poor’s, 2020. Brazil BB- With STABLE Outlook (6 April 2020) Colombia BBB- With NEGATIVE Outlook (26 March 2020) Chile A+ With NEGATIVE Outlook (27 April 2020) Mexico BBB With NEGATIVE Outlook (26 March 2020) Peru BBB+ With STABLE Outlook (4 May 2020)
  25. 25. Country Presidents Argentina President: Alberto Fernandez Birth: 2 April 1959 In office since: 10 December 2019 Political Party: Frente de Todos Brazil President: Jair Bolsonaro Birth: 21 March 1955 In office since: 1 January 2019 Political Party: PSL Colombia President: Iván Duque Márquez Birth: 1 Agosto 1976 In office since: 7 Agosto 2018 Political Party: Centro Democrático Chile President: Sebastián Piñera E. Birth: 1 December 1949 In office since: 11 March 2018 Political Party: Independent Mexico President: Andrés Manuel López O. Birth: 13 November 1953 In office since: 1 December 2018 Political Party: Morena Peru President: Martín Vizcarra Birth: 22 Marzo 1963 In office since: 23 March 2018 Political Party: Peruanos por el Kambio
  26. 26. Land Area Source: The World Bank, 2018. 2,736,690 8,358,140 1,109,500 743,532 1,943,950 1,280,000 0 1,000,000 2,000,000 3,000,000 4,000,000 5,000,000 6,000,000 7,000,000 8,000,000 9,000,000 Argentina Brazil Colombia Chile Mexico Peru Note: Kilometers
  27. 27. Ease of Doing Business Index 126 124 67 59 60 76 0 20 40 60 80 100 120 140 Argentina Brazil Colombia Chile Mexico Peru Source: The World Bank, 2019. Note: 1 = Most Business-friendly Regulations
  28. 28. Population Growth 1.0% 0.8% 1.4% 1.2% 1.1% 1.6% 0% 1% 1% 2% 2% Argentina Brazil Colombia Chile Mexico Peru Source: The World Bank, 2019. Note: Annual Percentage
  29. 29. Total Population 44,938.7 211,049.5 50,339.4 18,952.0 127,575.5 32,510.5 0 50,000 100,000 150,000 200,000 250,000 Argentina Brazil Colombia Chile Mexico Peru Source: The World Bank, 2019. Note: (i) Thousands; (ii) Total Inhabitants
  30. 30. Urban Population 92% 87% 81% 88% 80% 78% 0% 20% 40% 60% 80% 100% Argentina Brazil Colombia Chile Mexico Peru Source: The World Bank, 2019. Note: Percentage of Total Population
  31. 31. Poverty Headcount Ratio 1.0% 4.4% 4.1% 0.3% 1.7% 2.6% 0% 1% 2% 3% 4% 5% Argentina Brazil Colombia Chile Mexico Peru Source: The World Bank, 2017 - 2018. Note: (i) At US$1.90 / Day; (ii) Percentage of Population
  32. 32. Exports of Goods and Services 17.3% 14.3% 15.9% 28.2% 39.1% 24.2% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% Argentina Brazil Colombia Chile Mexico Peru Source: The World Bank, 2019. Note: Percentage of GDP
  33. 33. Foreign Direct Investment 6,244 78,559 14,493 6,082 28,881 6,487 - 10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000 90,000 Argentina Brazil Colombia Chile Mexico Peru Source: The World Bank, 2018 - 2019. Note: (i) Net Inflows; (ii) BoP, Current Million US$
  34. 34. Gross Domestic Product $449,663.5 $1,839,758.0 $323,802.8 $282,318.2 $1,258,286.7 $226,848.1 $0 $300,000 $600,000 $900,000 $1,200,000 $1,500,000 $1,800,000 $2,100,000 $2,400,000 Argentina Brazil Colombia Chile Mexico Peru Source: The World Bank, 2019. Note: Millions, Current US$
  35. 35. GDP Per Capita $22,947.1 $15,258.9 $15,643.7 $25,155.0 $20,410.7 $13,380.4 $0.0 $5,000.0 $10,000.0 $15,000.0 $20,000.0 $25,000.0 $30,000.0 Argentina Brazil Colombia Chile Mexico Peru Source: The World Bank, 2019. Note: (i) PPP; (ii) Current International $
  36. 36. GDP Growth -2.2% 1.1% 3.3% 1.1% -0.1% 2.2% -3% -2% -1% 0% 1% 2% 3% 4% 5% Argentina Brazil Colombia Chile Mexico Peru Source: The World Bank, 2019. Note: Annual Percentage
  37. 37. Gross Savings 17% 12% 15% 19% 23% 20% 0% 5% 10% 15% 20% 25% Argentina Brazil Colombia Chile Mexico Peru Source: The World Bank, 2018 - 2019. Note: Percentage of GDP
  38. 38. Personal Remittances $0.0 $10,000.0 $20,000.0 $30,000.0 $40,000.0 Argentina Brazil Colom bia Chile M exico Peru $535.2 $3,295.5 $6,769.9 $65.7 $38,628.6 $3,326.0 Source: The World Bank, 2019. Note: (i) Received; (ii) Millions, Current US$
  39. 39. Total Reserves $45,215.6 $356,886.4 $52,652.7 $40,655.5 $183,056.1 $67,711.5 $0.0 $50,000.0 $100,000.0 $150,000.0 $200,000.0 $250,000.0 $300,000.0 $350,000.0 $400,000.0 Argentina Brazil Colombia Chile Mexico Peru Source: The World Bank, 2019. Note: (i) Includes Gold; (ii) Millions, Current US$
  40. 40. Revenue 18% 29% 22% 22% 19% 19% 0% 5% 10% 15% 20% 25% 30% Argentina Brazil Colombia Chile Mexico Peru Source: The World Bank, 2018. Note: (i) Excluding Grants; (ii) Percentage of GDP
  41. 41. Government Expenditure on Education 5.5% 6.2% 4.5% 5.4% 4.9% 3.7% 0% 2% 4% 6% 8% Argentina Brazil Colombia Chile Mexico Peru Source: The World Bank, 2015 - 2018. Note: Percentage of GDP
  42. 42. Labor Force Source: The World Bank, 2019. 20,772.7 106,500.8 26,787.9 9,557.9 57,142.2 18,864.9 0 20,000 40,000 60,000 80,000 100,000 120,000 Argentina Brazil Colombia Chile Mexico Peru Note: Thousands
  43. 43. Labor Force (Female) 43.0% 43.6% 42.9% 42.2% 37.8% 45.7% 0% 10% 20% 30% 40% 50% Argentina Brazil Colombia Chile Mexico Peru Source: The World Bank, 2019. Note: Percentage of Total Labor Force
  44. 44. Unemployment 9.8% 12.1% 9.7% 7.1% 3.4% 3.3% 0% 3% 6% 9% 12% 15% Argentina Brazil Colombia Chile Mexico Peru Source: The World Bank, 2019. Note: (i) Percentage of Total Labor Force; (ii) Modeled ILO Estimate
  45. 45. Energy Use Source: The World Bank, 2014 - 2015. 2,030 1,496 724 2,006 1,537 790 0 500 1,000 1,500 2,000 2,500 Argentina Brazil Colombia Chile Mexico Peru Note: Kg of Oil Equivalent per Capita
  46. 46. Renewable Electricity Output 28.1% 74.0% 68.2% 43.6% 15.4% 52.7% 0% 10% 20% 30% 40% 50% 60% 70% 80% Argentina Brazil Colombia Chile Mexico Peru Source: The World Bank, 2015. Note: Percentage of Total Electricity Output
  47. 47. Population Living in Slums 17% 22% 13% 9% 11% 34% 0% 10% 20% 30% 40% Argentina Brazil Colombia Chile Mexico Peru Source: The World Bank, 2005 - 2014. Note: Percentage of Urban Population
  48. 48. External Debt Stocks 56.1% 30.3% 42.3% 38.0% 31.3% 0% 10% 20% 30% 40% 50% 60% Argentina Brazil Colombia Chile Mexico Peru Source: The World Bank, 2018. Note: Percentage of GNI
  49. 49. Bank Capital to Assets Ratio 13.3% 10.1% 17.0% 8.4% 11.0% 12.5% 0% 3% 6% 9% 12% 15% 18% Argentina Brazil Colombia Chile Mexico Peru Source: The World Bank, 2018 - 2019. Note: Percentage
  50. 50. Bank Nonperforming Loans to Total Gross Loans 5.6% 3.1% 4.2% 1.9% 2.1% 3.3% 0% 1% 2% 3% 4% 5% 6% Argentina Brazil Colombia Chile Mexico Peru Source: The World Bank, 2018 - 2019. Note: Percentage
  51. 51. Deposit Interest Rate 47.3% 5.4% 4.5% 2.5% 3.5% 4.8% 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% Argentina Brazil Colombia Chile Mexico Peru Source: The World Bank, 2017 - 2019. Note: Percentage
  52. 52. Lending Interest Rate 67.3% 37.5% 11.8% 4.2% 8.5% 17.0% 0% 10% 20% 30% 40% 50% 60% 70% Argentina Brazil Colombia Chile Mexico Peru Source: The World Bank, 2017 - 2019. Note: Percentage
  53. 53. Listed Domestic Companies Source: The World Bank, 2019. 91 324 66 203 139 196 0 50 100 150 200 250 300 350 400 Argentina Brazil Colombia Chile Mexico Peru Note: Total
  54. 54. Market Capitalization of Listed Domestic Companies $39,393.54 $1,187,361.69 $132,040.28 $203,791.65 $413,618.82 $98,964.96 $0.0 $200,000.0 $400,000.0 $600,000.0 $800,000.0 $1,000,000.0 $1,200,000.0 Argentina Brazil Colombia Chile Mexico Peru Source: The World Bank, 2019. Note: (i) Millions; (ii) Current US$
  55. 55. Strength of Legal Rights Index Source: The World Bank, 2019. 2 2 11 4 10 7 0 2 4 6 8 10 12 Argentina Brazil Colombia Chile Mexico Peru Note: 0 = Weak to 12 = Strong
  56. 56. Military Expenditure 2.1% 3.9% 11.6% 7.4% 2.1% 5.6% 0% 2% 4% 6% 8% 10% 12% 14% Argentina Brazil Colombia Chile Mexico Peru Source: The World Bank, 2018. Note: Percentage of General Government Expenditure
  57. 57. § Historic Lessons of the 1918 Pandemic. https://www.youtube.com/watch?v=slTWGx6XAs0&t=59s § Risks of US – China Relationship. http://www.nuricumbo.com.mx/the-war-that-nobody-wants/ § Willingness to Pay & Value Stick. https://www.youtube.com/watch?v=ki3p1gmABU4 • Are we the cancer on this planet? https://mundoejecutivo.com.mx/actualidad/2020/05/18/nos otros-somos-el-cancer-del-planeta/ § Mexico’s Top 25 CFO’s of 2017 https://www.youtube.com/watch?v=Wi-bR_jbxes • Why should we measure Economic Confidence? https://imcp.org.mx/publicaciones/el-imcp-comunica-para- que-nos-sirve-medir-la-confianza-economica/ § Interview with Ana Maria Salazar (ADN40) https://twitter.com/adn40/status/1150034010451529731?s= 20 § Interview with the Ambassador of Spain in Mexico. http://www.aapaunam.mx/assets/jul_sep_read_2019.pdf Nuricumbo + Partners in the Media
  58. 58. We care about your business priorities. Let’s talk! E-mail: contacto@nuricumbo.com Mobile/Whatsapp: + 52 (155) 5453 6309 Skype: nuricua Twitter: @a_nuricumbo Office: Montes Urales 424 Lomas de Chapultepec, CDMX Please visit our website

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