MercoPress. South Atlantic News Agency
Lessons from India Jindal’s Bolivian investment failure
Jindal’s integrated mining and steel project in Bolivia was the largest contract secured by an Indian company in Latin America. The project, which ultimately became a victim of the country's domestic politics, has lessons for Indian companies venturing into Latin America. Read full article
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Jul 20th, 2013 - 06:00 am - Link - Report abuse 0A sharp, perceptive & insightful article from a “New Thinker” that KNOWS what he is talking about!
I quote from Mr. Rengaraj Viswanathan own webpage….:
“I am a believer in the New Latin America which has a new paradigm of sustainable political stability, economic growth and autonomy in foreign policy based on a new mindset and market.
The region has found its own development model in the “Brasilia Consensus” of equilibrium between pro-poor and pro-business policies.
The macroeconomic fundamentals have become stronger and the economies have become more resilient and resistant to external shocks.
The Latin American countries are moving in the direction of regional and sub-regional integration which reinforce their political and economic stability while at the same time the groups have become like firewalls against external interference….. Exceptions are there, of course.
http://www.rviswanathan.com/profile.html
Keep the good work, MercoPress…. Articles like this one add real value to your product.
El Think
Chubut, Patagonia, Argentina
What a thoughtful and honest article - a pleasure to read.
Jul 20th, 2013 - 10:03 am - Link - Report abuse 0So what is this guy saying?
Jul 20th, 2013 - 10:29 am - Link - Report abuse 0These people failed for not doing business the Latam way, instead of the way that everyone else does business, by honouring contracts?
Sounds like that to me.
Sounds like, if you want to do business down there, keep quiet about the details and be prepared to be ferked about!
(2) Pytangua
Jul 20th, 2013 - 11:40 am - Link - Report abuse 0I fully agree. This man really knows South America!
Just of curiosity, I checked Mr. Rengaraj Viswanathan opinion on the current Paraguayan situation.
That’s what he wrote:
”Colorado Party comes back to power making Paraguay a politically landlocked country again
The Colorados had ruled the country continuously for 61 years in a one-party dictatorship until 2008 when Fernando Lugo, the leftist ”Bishop of the Poor“ defeated the Colorado candidate and made history…
Eventually the Colorados in collusion with Vice President Franco from the Liberal party ousted President Lugo through impeachment in an ugly congressional coup in June 2012…
The return of the Colorados means ” business as usual” with the government agenda driven by the rich and powerful. The President-elect Cartes is one of the richest businessmen with interests in 25 companies…
The governance is opaque and the institutions are weak. They are not based on rules or systems. Even the economy is mostly informal. Unofficial foreign trade is much more than the official one. One of the biggest businesses in the country is to smuggle electronic and other goods to Brazil and Argentina from the border city of Ciudad del Este…
There is no proper merit-based transparent system for recruitment to government jobs. There are very few avenues for upward mobility of the bottom of the pyramid given the poor educational and socio economic conditions. There are over a million (one sixth of the total population) Paraguayans who have moved to work as maids and laborers in Argentina…
Paraguay has not changed much from the portrayal of the country by Graham Greene in his novel “Honorary Consul”. Greene describes the country as a corrupt, decadent and backward. Even today, visitors to the country are likely to feel as though they have entered the nineteenth century…”
http://www.latinamericanaffairs.blogspot.dk/2013/04/colorado-party-comes-back-to-power-in.html
Ambassador Viswanathan has great hindsight!
Jul 20th, 2013 - 04:27 pm - Link - Report abuse 0Why oh why, if he had all this 'nous' and experience of the Latino psyche did he not advise his fellow countryman to steer clear of the Cowpat and his leftist traits?
Another defeat snatched by an ‘Indian’ from the jaws of victory. Well done Cowpat.
“Simples”.
I am a Swedish academic living in Bolivia for long time. I appreciate and commend your article. Your description and analysis is absolutely correct. Thank you!
Jul 20th, 2013 - 09:18 pm - Link - Report abuse 0An Indian lecturing others on corruption, oligarchs and dominant party politics.
Jul 21st, 2013 - 03:21 am - Link - Report abuse 0Now I've seen it all!
With Indians it is always someone else's fault.
So, every Indian company will think twice about investing in Latin America because one Indian company had a bad experience in Argentina...
Jul 21st, 2013 - 08:38 am - Link - Report abuse 0Welcome to MP logic, you guys seriously think investors give a darn about other companies failures?
Let's see?
Jul 21st, 2013 - 09:55 am - Link - Report abuse 0I am interested in starting a business in an area where other businesses have failed or investing in those businesses.
I do not concern myself with the reasons why they failed or what those failures might mean for my business or investment.
I must be a brainless moron with money to burn!
8 Stevie
Jul 21st, 2013 - 12:08 pm - Link - Report abuse 0When I worked for a very large multinational company HQd in britain I was co-opted to the Due Diligence Team because of my technical ability.
Guess what we always considered first when we looked at a company we were thinking of acquiring: YES, you have guessed it- the 'track record' of the governments of that country and how they treated international businesses who owned 'their' companies.
AND, don't forget the local example of The Dark Country and Repsol! Who in their right mind would recommend to their Main Board that they buy into argieland: unless they are used to dealing with snake oil salesmen like Chevron are.
Chevron however may have ‘overlooked’ the thing that we all know about The Dark Country: they NEVER keep their word.
Turnip at (10)
Jul 21st, 2013 - 02:28 pm - Link - Report abuse 0Guess who's doing good business in Argentina since 1919?
http://www.ge.com/ar/
Well Chris, if you too disqualified a whole continent for having a bad experience in a single country, I most surely understand why you are not in that position anymore...
Jul 21st, 2013 - 03:44 pm - Link - Report abuse 0Bad experience in a single country!
Jul 21st, 2013 - 03:46 pm - Link - Report abuse 0Lol. Thats a good one.
@11 Suicide In Waiting (never forget my offer to help you with this)
Jul 21st, 2013 - 04:10 pm - Link - Report abuse 0Yes, but have you bothered to analyse the performance?
Extract from the 2012 GE report
http://www.ge.com/ar2012/pdf/GE_AR12.pdf it runs to 150 pages and you need to read the Notes.
Return on Capital Invested by Region. (Percentage) Calculated by ChrisR
U.S..........................20.2
Europe....................14.3
Pacific Basin...........43.4
Americas.................39.3*
Mid. East & Africa...21.7
Comment by ChrisR:
Interestingly, although there are $13,982 MILLION of funds written to Discounted cash flow (and Collateral value) and is comparable to £13,864 of CONSOLIDATED NET EARNINGS, there is no breakdown by regions.
This has not been flagged by the press! Readers should be aware that this represents a LOSS of $118 MILLION of CNE! Not helpful to the future performance.
From the Notes to the Report:
$1.8 billion of GE cash and equivalents is held in countries with currency controls that may restrict the transfer of funds to the U.S. or limit our ability to transfer funds to the U.S. without incurring substantial costs. These funds are available to fund operations and growth in these countries and we do not currently anticipate a need to transfer these funds to the U.S.
NOW I WONDER WHO HAS MOST OF THAT.
Of course things were MUCH better for businesses in The Dark Country in 1919 and it has been downhill since then. The report for 2012 does its best at clouding the fact that overall performance has suffered and continues to suffer due toi the global problems. GE Capital still provides a massive share of profits by lending money made in previous years to the present regional businesses: nothing like keeping it in the family.
Ex-employee and shareholder I can see......
Jul 21st, 2013 - 07:44 pm - Link - Report abuse 015 I Don't Think
Jul 21st, 2013 - 09:46 pm - Link - Report abuse 0Close, but Director and shareholder of a company of the General Electric Company Limited.
Give you a clue: it's NOT the same company but I helped check our GEC Company Report and know where the bad news will be buried.
Ain't directors employees nowadays?
Jul 21st, 2013 - 10:09 pm - Link - Report abuse 0Ain't ex-directors ex-employees nowadays?
17 I Don't Think
Jul 22nd, 2013 - 04:20 pm - Link - Report abuse 0Not in the UK, there is something called the Corporations Act 2001 which superseded the Companies Act 1985. The Corporations Act imposes legal requirements on 'Directors' as to their behaviour, especially in relation to concert parties and insider trading among others.
Personal taxation is also very different when you are a Director, basically you pay more, just as if you were a Sole Trader under UK Tax Law.
But once the relationship with the company ceases many directors have contracts which must be adhered to otherwise an action for breach can be brought under contract law.
I also have a lifelong confidentiality agreement which precludes me for the rest of my life from disclosing or discussing with others or otherwise transmitting information expressly forbidden in the contract without the written permission of the other party of the contract.
Turnip at (18)
Jul 22nd, 2013 - 04:32 pm - Link - Report abuse 0As I said at (15) then........, “ex-employee and shareholder”......
19 I Don't Think
Jul 22nd, 2013 - 06:27 pm - Link - Report abuse 0If you are referring to the time after I left the business, then NO, you are incorrect.
I had thought I had explained the situation as lucidly as possible.
A Director is not an employee so can never be an ex-employee, he is in fact a retired Director or, if he moves to another company or starts his own business like I did he is a 'former Director of...and is now a Director / Executive of whatever.
I do realise you only exist to wind the Brits up but I had mistakenly thought that you were actually interested for once.
Oh dear.
Turnip at (20)
Jul 22nd, 2013 - 09:41 pm - Link - Report abuse 0Why on Earth would I be the least interested in an old English Psychopath that repeatedly breaks English and International laws by issuing death threats online to the Argentinean President, diverse MercoPress’ posters and god knows whom else…….
Why on Earth would I be the least interested in an old grumpy English ex-pat pensioner, persistently insulting friends and foes online and “bragging” about being an ex-employee of a Yankee multinational?
There are a fantasyllion things in South-America more interesting than the likes of you…..
Do us (and yourself) a favour…….. Return to your beloved England…… Nobody needs an Old English Turnip like you down here…
So, Winky Dink, what do you do for a living?
Jul 23rd, 2013 - 03:17 am - Link - Report abuse 0You work in the UK don't you?
21 Think aka AND I ALSO NEED READING GLASSES OR A NEW BRAIN
Jul 23rd, 2013 - 11:33 am - Link - Report abuse 0You stupid bitter old sod, the General Electric Company Ltd. is BRITISH.
BTW I am not down there, I am in the civilised country of Uruguay.
That's TREE times I have had to correct you on the same post, dementia onset or worse?
What a twat.
“when venturing into Latin America, a continent where people matter more than systems, rules and regulations. ”
Jul 23rd, 2013 - 02:44 pm - Link - Report abuse 0And therein lies the problem, and the great deception.
If people matter more than systems, rules, and regulations, which they obviously do, then don't go outside the system, rules, & regulations. Doing so, only hurts the people, the ones that really matter.
“People matter more than systems”, so we have perfect justification for working outside the system and doing whatever we see fit. Until the next guy, or gal, gets to do things their way.
One needs to be real careful with the above deceiving rhetoric. That thinking doesn't serve the people at all. Stand back from that fantasy and look at the real world around you down there. Rule-of-law is important for a people.
Turnip at (23)
Jul 23rd, 2013 - 06:01 pm - Link - Report abuse 0Ahhhhhh.... G E C plc.
That English based, German-Italian failed company.....
Soooooo..........
You are an ex-employee of a not longer existing company then......
Not much to brag about....................... is it?
@ 21 Think aka AND I ALSO NEED READING GLASSES OR A NEW BRAIN
Jul 23rd, 2013 - 10:10 pm - Link - Report abuse 0Wrong again. FOURTH time AND I know you need glasses: read my last post when I deliberately left the H out of THREE so it read TREE! But you NEVER saw it!
Guess who crashed the company, the lazy Italians of Caserta, who were lovely people but completely lazy and workshy: just like you!
That was after Lord Weinstock had retired and I had already left the company five years before for a better paying position elsewhere.
Still, you never have had a good job have you, not unless you count the one working for the wealthier side of your family in Chile but even they couldn’t stomach your griping and ‘the world owes me a living’ attitude, could they?
Try again, perhaps, just perhaps, one day you will get something right. Mind you I suspect the ‘next’ time might be your first.
Be honest with yourself, even when I cut you a break, you still manage to snatch defeat from the jaws of victory.
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