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Our Newsletter. Mexico & Latin America. July 2020.

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We help companies to be successful in Mexico & Latam via highly personalized and cost-effective consulting services. Areas of expertise include interim management, CFO/controller roles, special audits, fraud investigations, anti-corruption initiatives, internal control assessments, financial reporting, project management, risk management, strategic planning, financial transformations and turnarounds. On the commercial side, public relations, business development, contract negotiations, communications, social media, and design and execution of commercial strategy.

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Our Newsletter. Mexico & Latin America. July 2020.

  1. 1. LATIN AMERICA UPDATE July 2020 www.nuricumbo.com
  2. 2. How integrated is North America?How integrated is North America?
  3. 3. Automotive Industry continues to be the Crown Jewel Automotive Industry continues to be the Crown Jewel
  4. 4. Trade Corridors have been establishedTrade Corridors have been established
  5. 5. Energy sector is one of the most dynamicEnergy sector is one of the most dynamic
  6. 6. Illegal Immigration from Mexico has declinedIllegal Immigration from Mexico has declined
  7. 7. Correlation of U.S. Arms Sales and Homicides in Mexico is quite clear Correlation of U.S. Arms Sales and Homicides in Mexico is quite clear
  8. 8. Some in the U.S. are benefitting from Arms Sales to Latin America Some in the U.S. are benefitting from Arms Sales to Latin America
  9. 9. Some paradigms will continue to be brokenSome paradigms will continue to be broken
  10. 10. WE ARE NURICUMBO + PARTNERS
  11. 11. OUR VALUE PROPOSITION: professional experience. OUR VALUE PROPOSITION:  Highly experienced consultants.  High degree of flexibility.  Ideal to tackle those important but not urgent tasks that otherwise never get done.  Able to support in the resolution of special or confidential projects.  Important specialization in Finance and Accounting projects.  More than 50 multidisciplinary consultants. Average of 15 to 20 years of professional experience. We are Nuricumbo + PartnersWe are Nuricumbo + Partners
  12. 12. SOME EXAMPLES:SOME EXAMPLES:  Interim C-Level Executives.  Financial Due Diligence for M&A.  Part-Time CFOs.  Comisarios / Consejeros.  Interim Project Teams.  Specialized Training Programs.  Debt/Equity Solutions.  Fintech Trusts (Fideicomisos)  Process Improvement  Special Audits (Forensic, Compliance, etc.) How do we help some of our clientsHow 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 multionationalsand 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. $5.49 $5.34 $5.47 $0.00 $1.50 $3.00 $4.50 $6.00 April May June Brazil Exchange RatesExchange Rates $3,963.61 $3,730.76 $3,758.06 $0.00 $1,500.00 $3,000.00 $4,500.00 April May June Colombia $24.17 $22.18 $22.99 $0.00 $10.00 $20.00 $30.00 April May June Mexico $3.38 $3.43 $3.54 $0.00 $1.00 $2.00 $3.00 $4.00 April May June Peru Source: Bloomberg, 2020. *USD / PEN *USD / MXN *USD / CLP *USD / BRL *USD / COP $835.53 $806.47 $821.24 $0.00 $200.00 $400.00 $600.00 April May June Chile *USD / CLP $66.83 $68.53 $70.46 $0.00 $25.00 $50.00 $75.00 April May June Argentina *USD / ARS
  18. 18. Source: Argentina, Brazil, Colombia, Chile, Mexico and Peru Central Banks, 2020. 48.40% 45.60% 43.40% 0.00% 20.00% 40.00% 60.00% March April May Argentina Inflation RateInflation Rate 3.31% 2.46% 2.05% 0.00% 1.50% 3.00% 4.50% March April May Brazil 3.51% 2.85% 2.19% 0.00% 1.00% 2.00% 3.00% 4.00% April May June Colombia 3.40% 2.80% 2.60% 0.00% 1.00% 2.00% 3.00% 4.00% April May June Chile 2.15% 2.84% 3.30% 0.00% 1.50% 3.00% 4.50% April May June Mexico 1.87% 1.78% 1.60% 0.00% 0.90% 1.80% 2.70% April May June Peru
  19. 19. $43,545 $42,748 $43,219 $0 $15,000 $30,000 $45,000 $60,000 April May June Argentina International ReservesInternational Reserves $362,460 $343,165 $339,317 $0 $120,000 $240,000 $360,000 $480,000 March April May Brazil $53,863 $56,362 $56,584 $0 $18,000 $36,000 $54,000 $72,000 April May June Colombia $36,885 $36,756 $36,361 $0 $13,000 $26,000 $39,000 $52,000 April May June Chile $186,655 $187,316 $188,942 $0 $60,000 $120,000 $180,000 $240,000 April May June Mexico $73,632 $73,439 $71,450 $0 $20,000 $40,000 $60,000 $80,000 April May June 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. 32,742.84 37,824.73 38,686.69 0 12,000 24,000 36,000 48,000 April May June Argentina Capital MarketsCapital Markets 80,505.90 87,402.60 95,055.80 0 30,000 60,000 90,000 120,000 April May June Brazil 1,142.04 1,095.84 1,111.80 0 500 1,000 1,500 2,000 April May June Colombia 14,779.28 15,580.85 16,878.00 0 7,000 14,000 21,000 April May June Peru 36,470.11 36,122.73 37,716.43 0 15,000 30,000 45,000 April May June Mexico 3,977.56 3,647.60 3,959.02 0 1,200 2,400 3,600 4,800 April May June Chile *IPSA:IND *MEXBOL:IND *SPBLPGPT:IND *MERVAL:IND *IBOV:IND *COLCAP:IND Source: Bloomberg, 2020.
  21. 21. Foreign Direct InvestmetForeign Direct Investmet $11,517 $12,162 $6,244.42 $0 $4,000 $8,000 $12,000 2017 2018 2019 Argentina $67,583 $61,223 $78,559 $0 $30,000 $60,000 $90,000 2017 2018 2019 Brazil $13,836 $11,010 $14,493 $0 $5,000 $10,000 $15,000 $20,000 2017 2018 2019 Colombia $11,942 $6,856 $7,160 $0 $4,000 $8,000 $12,000 2016 2017 2018 Chile $32,091 $31,604 $28,882 $0 $12,000 $24,000 $36,000 2017 2018 2019 Mexico $6,863 $6,769 $6,175 $0 $3,000 $6,000 $9,000 2016 2017 2018 Peru *U.S. Dollars at Current Prices in Millions Source: United Nations Conference on Trade and Development, UNCTAD, 2018 - 2019.
  22. 22. Credit RatingsCredit 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 RatingsCredit Ratings Argentina Ca With NEGATIVE Outlook (3 April 2020) Source: Moody’s, 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 RatingsCredit Ratings Argentina SD (7 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 PresidentsCountry 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 AreaLand 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 IndexEase 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 GrowthPopulation Growth 1.0% 0.8% 1.5% 1.4% 1.1% 1.7% 0% 1% 1% 2% 2% Argentina Brazil Colombia Chile Mexico Peru Source: The World Bank, 2018. Note: Annual Percentage
  29. 29. Total PopulationTotal 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 PopulationUrban 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 RatioPoverty 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$1.90 / Day; (ii) Percentage of Population
  32. 32. Exports of Goods and ServicesExports of Goods and Services 17.3% 14.3% 15.9% 28.2% 39.1% 24.2% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% Argentina Brazil Colombia Chile Mexico Peru Source: The World Bank, 2019. Note: Percentage of GDP
  33. 33. Foreign Direct InvestmentForeign Direct Investment - 10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000 6,244 78,559 14,493 6,082 28,881 6,487 Source: The World Bank, 2018 - 2019. Note: (i) Net Inflows; (ii) BoP, Current Million US$
  34. 34. Gross Domestic ProductGross 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 CapitaGDP Per Capita $22,816.5 $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 GrowthGDP 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 SavingsGross 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 RemittancesPersonal Remittances $0.0 $10,000.0 $20,000.0 $30,000.0 $40,000.0 $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 ReservesTotal 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 $400,000.0 Argentina Brazil Colombia Chile Mexico Peru Source: The World Bank, 2018. Note: (i) Includes Gold; (ii) Millions, Current US$
  40. 40. RevenueRevenue 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 EducationGovernment 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 ForceLabor 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)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. UnemploymentUnemployment 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 UseEnergy 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 OutputRenewable 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 SlumsPopulation 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 StocksExternal 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 RatioBank 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 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 RateDeposit Interest Rate 47.3% 5.4% 4.5% 2.5% 3.5% 2.6% 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% Argentina Brazil Colombia Chile Mexico Peru Source: The World Bank, 2016 - 2019. Note: Percentage
  52. 52. Lending Interest RateLending 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, 2016 - 2019. Note: Percentage
  53. 53. Listed Domestic CompaniesListed 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 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 IndexStrength 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 ExpenditureMilitary 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. 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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