Tag Archives: latin-america
Brazil hailed as an exciting opportunity for buy to let property investors
Brazil is one of the world’s most exciting emerging property markets for investors looking for buy to let real estate that brings in a regular income, according to a new report. The report highlights how this years FIFA World Cup and the 2016 Olympic Games means that the country will attract more visitors which increases rental prospects in the major cities, especially those hosting these sporting events. The information in the report from Colordarcy is gathered from several independent sources, to give a clear overview of the main property hotspots and the kind of returns investors can expect, according to managing director Loxley McKenzie. ‘With an economy that has grown rapidly, Brazil looks set to continue offering investors high emerging market returns at low risk. Our latest report is designed to give investors, who may not be too familiar with Brazil, advice on where and how to invest,’ he added. Overall the outlook for property prices in Brazil will depend on how many people want a particular property and what they are prepared to pay for it, according to the report. When it come to rents at the moment the volume of rental properties in major cities is very low and vacancy rates are only 10%, according to real estate portal Zap Imoveis. ‘This creates an unique opportunity in Brazil property and see rental yields of 8% to 11% per annum and an increase in the price of property of between 10% and 15% per annum,' the report says. ‘In the major cities young professionals are struggling to afford the kind of prices now being asked for properties in good areas and even with the mortgage rates falling into single figures, affordability is unlikely to improve,’ it claims. ‘As a result those who purchase buy to let properties in Sao Paulo, Rio de Janeiro and Brasilia are cashing in by doubling the rent when tenants come to renew their contracts,’ it adds. The report suggests that the most attractive investments in terms of yields are smaller one and two bedroom apartments in new developments. 'Despite the shortage of rental properties, older developments that lack modern amenities are unlikely to see the dramatic increases in rents seen in new developments,’ the report explains. ‘A 50 square meter apartment will generate yields of 9.6% whereas larger units would be 5.4% to 7.2%. Apartments in the suburbs of Sao Paulo offer yields of between 4% and 8% and in more central areas close to transport links yields can be up to 11%, making it one of the world’s most attractive destinations for buy to let investors,’ it adds. When it comes to looking ahead the report points out that some of the dramatic increases in property prices seen since 2009 are now beginning to stabilise, adding that this is not a surprise as construction has accelerate to meet demand. Indeed, in 2013 price growth slowed from around 20% year on year to 12% and 10% to 12% is forecast for 2014. It also points… Continue reading
South American drug cartels target GCC
South American drug cartels target GCC Allan Jacob / 25 February 2014 Narco-terrorists have established routes through West Africa to emerging markets in the region and Asia. The death of actor Philip Seymour Hoffman from suspected heroin overdose may have thrown the spotlight on drugs, but narco-terrorism is the larger concern for security agencies around the world, including the UAE and other GCC countries. A leading security expert has revealed that Latin American cartels entrenched in Africa are eyeing the GCC for supplying and trafficking in narcotics. They also seek to launder their dirty money from the drug trade in the region as the zero tax regime aids their operations. Narco-terrorism refers to the nexus between drug cartels, transnational criminal organisations and terrorist groups. “In the last 10 years, drug cartels from South America have increased their presence and operations in West Africa to secure the movement of drugs (mostly cocaine) to markets in Europe, and the emerging markets in Asia and the Middle East,” said Johan Obdola, President of the International Organisation for Security and Intelligence, which advises governments on how to tackle the scourge. Latin American drug cartels and terrorist groups, including Colombia’s Farc rebels, Mexican drug organisations like ‘Zetas’ and El Chapo Guzman are actively involved in Africa, mainly in West Africa. He said these cartels were hoping to establish themselves in the Middle East and Asia. “We are identifying the new routes that narco-terrorist groups are developing and operating between South America — specifically Brazil and Argentina — to the GCC region, mainly Qatar, with ramifications in the UAE,” said Obdola, a former Venezuelan police commissioner, who now lives in Canada. He said these organised groups were already in “their second stage of their operations”. They are keen to use the UAE as a hub for drug trafficking and money laundering. The bigger concern was that they were working on all fronts to establish a demand for their products in Dubai and Abu Dhabi, he said. “Colombia, Brazil, Paraguay and Argentina. Currently, Mexico, El Salvador, Venezuela, Trinidad and Tobago are nations where well-organised narco-terrorist groups are developing their routes to the GCC region and Asia,” he said. Last week, Colonel Saeed Al Suwaidi, Director-General of the UAE’s Federal Anti-Narcotics Agency in the Ministry of Interior, said 11 tonnes of narcotics were seized in 2013. The Ministry of Interior also said assets and money of those involved in the sale of drugs and associated with money laundering would be confiscated. There is no evidence that the banned Muslim Brotherhood is benefiting from the drugs trade, but Obdola added that Al Qaeda was spreading its tentacles in Latin America. “There are confirmed operatives in Brazil, Colombia and other nations, including some countries in Central America (Honduras and Mexico). Al Qaeda members are also doing business with Colombian drug cartels and the Farc rebels.” Al Qaeda in the Islamic Maghreb (AQIM), Hezbollah and other groups are increasingly active in Latin America and Mexico, and cocaine trade is a very important financial support. Obdola said the GCC and UAE have two main fronts in the fight against narco-terror emerging from Latin America via Africa, and from Afghanistan. “The narcotics industry, with the involvement of organised criminals, drug cartels and terrorist groups are establishing a strategically sound alliance for financial and even political gain,” he said. Latin American drug networks are structured for money laundering and local consumption of drugs based on demand. These cartels also have the discreet ability and financial heft to spark off corruption and infiltrate private corporates, and transport, logistics, and security units. Investments are made in real state, front businesses, transportation and other sectors as well. The UAE police and security agencies have done good work in the areas of enforcement and intelligence to counter the illegal drug trade. They are engaging with communities to gather local intelligence and are also working with agencies globally to provide the best response against the phenomenon. allan@khaleejtimes.com The Latin American connection Amira Agarib Security officials in the UAE have confirmed the South American link to narcotics smuggling and established crime in the region. Lieutenant-General Dhahi Khalfan Tamim, Deputy Chairman of Police and Security in Dubai, speaking to Khaleej Times, said there has been an increase in drug-related activity from Latin America where traffickers exploit Africans and Asians, including women. According to Dubai Police statistics, there has been an increase in smuggling of cocaine and heroin from Latin America to Africa, GCC and other countries via the Dubai International Airport. The drugs haul represents 75 per cent of all drug seizures at Dubai Airports. “Drug traffickers not only break anti-drug laws but also laws governing financial institutions. It’s an established network where they rope in local criminals and anti-social elements — bribery and blackmailing are common in their modus operandi,” he said. Investigations have shown that drug traffickers are actively targeting countries facing political unrest to channel their illegal substances. He said youth unemployment has become a concern and many young people are taking to drugs to escape from their misery. “People are exploited because of their circumstances by these large cartels who use closer geographical locations, porous borders and lack of effective legislation to promote drugs.” “There is a relationship between international drug smuggling and the growth of money laundering which is then channelled into other nefarious activities,” Lt-Gen Khalfan said. He called it a vicious cycle where high demand for substances led to increased production which, in turn, creates more markets. For more news from Khaleej Times, follow us on Facebook at facebook.com/khaleejtimes , and on Twitter at @khaleejtimes Continue reading
Africa: There’s Hope for African Farmers
By Alex O Awiti, 15 October 2013 Africa accounts for 60 per cent of the world’s arable, uncultivated land, according to a report published by McKinsey Global Institute in 2010. The FAO has shown that cereal yields in Africa are currently less than 50 per cent of those in Asia or South America. Such low productivity is largely attributable to the current state of smallholder farming. It is estimated that about 75 per cent of all farmland in Africa is less than 4.94 acres in size. Nearly 70 per cent of the African population lives in rural areas where they depend exclusively on agriculture as farmers or labourers for their livelihoods. A large percentage of these are women. A World Bank report published in 2011 estimated that the global food price spikes in 2008 pushed 44 million people below the poverty line, most of them in developing countries. According to Oxfam International, poor people in developing countries spend 50-80 per cent of their income on food. More than 90 per cent of Africans who live on less than $1.25 (Sh105) a day also happen to own and live on small farms. As the green revolution in Asia showed, the potential of smallholder development can be realised. But conditions have changed. Now smallholders face higher transaction costs and have to cope with the fact that agricultural research is biased towards large-scale production. This raises newchallenges in small farm development. On the other hand, higher prices of staple foods present opportunities for farmers. India and China have similar proportions of small farms as Africa, but have achieved significantly higher productivity. Despite the success of smallholder farmers in Asia, who fuelled the green revolution, there is skepticism that East Africa’s smallholders can replicate this model and deliver agricultural transformation and improve livelihoods among rural smallholder farmer. It is argued that for agricultural growth to gain traction, Africa’s agricultural and labour productivity will have to increase massively, requiring vast proportions of smallholder farmers to move out of the farm. High productivity of modern agriculture is associated with high technology, intense capital input and market linkages, and hence higher capacity to compete aggressively in factor markets, including land, labour and capital. However, these factors are not appropriate for the smallholder farm model. While there is a strong poverty-based case for trying to assist smallholder farmers, the agenda for African agricultural growth should be to introduce commercial agriculture on a competitive basis. Why is it that with all our research, technology and innovation, managerial capability and investment capacity, we are unable to make even a modest contribution to the pervasive problem of poverty, hunger and malnutrition in the smallholder farm families in sub Saharan Africa? We must learn from past successes and failures. Doing more of the same by refurbishing the solutions of the past – development aid, NGOs, training and visit, farmer field schools, international agricultural research organisations – is vital and has a critical role to play, but has not addressed the problem of low productivity, hunger and poverty. Paul Collier has argued that having the single most important sector of Africa’s economies almost exclusively managed by reluctant micro-entrepreneurs – smallholder farmers – is a recipefor continued divergence from global agricultural productivity. But in the logic of the timeless wisdom of CK Prahalad, we must stop thinking of smallholder farmers as victims or a burden and start recognising them as resilient and creative entrepreneurs and valueconscious consumers. What would be the defining characteristics of agriculture over the next half century if Africa were to converge on the performance of Asia and Latin America? I argue for a focus on small and medium-sized enterprises agribusiness. But harnessing Africa’s agricultural potential requires talented managers and entrepreneurs that can attract capital, apply technical expertise to develop profitable SME agribusinesses. Moreover, serving SME agribusiness will demand innovations in technology, services and business models. Africa’s large youth population provides a ready pool from which to develop talented entrepreneurs and managers who will drive the growth of agriculture. Those of us in the research, education, policy, development and business community can make this a reality by using our resources to build the capabilities of the African SME agribusiness sector to generate economic growth and achieve food and nutritional security. The writer is the director of East African Institute and associate professor at Aga Khan University. Continue reading
