tampabay.bizjournals.com Jane Meinhardt Staff Writer

CLEARWATER -- For a mere $15 each, representatives from 21 companies got a glimpse of possibly lucrative business opportunities in Chile.

They tapped into the pool of Chilean business specialists on the public's payroll, got contacts' names and vital information and learned about the country's regulations -- all without leaving the Tampa Bay area.

The business representatives attended the first in a series of videoconferences on international trade spearheaded by George L. Martinez, director of the U.S. Department of Commerce's regional export assistance center in Pinellas County.

The county's economic development technical staff set up the equipment for the conference's satellite link with business specialists in Chile, providing a group and one-on-one session that lasted just more than two hours.

Firms represented included most business segments, especially medical, information technology and construction.

"It was very cost-effective and informative," said Gary French, director of international sales for Clearwater-based Mercury Medical.

Most of the medical supply and equipment company's business is domestic, and it wants to expand its international market. French found the videoconference was a good entry to opportunities in Chile.

He estimated it would have cost him $1,500 to go to Chile and meet business specialists he communicated with during the conference.

"For 15 bucks, you can't beat it," French said. "I could see who I was dealing with and establish a contact. It was a great way to evaluate opportunities and screen perceptions using public professionals. It was clear, and it was understandable."

The videoconference highlighted information provided by officials working for the U.S. Commercial Services, a commerce department agency that has about 1,800 trade specialists in about 260 cities around the world.

Martinez selected Chile for the initial videoconference because Congress is reviewing a free trade agreement with the country, which would increase the country's market growth potential and export potential.

The agreement, similar to the free trade arrangement with Mexico, would eliminate the average 6-percent duty on U.S. products going into the country, Martinez said.

Florida companies already are doing a $1-billion-a-year export business with Chile, Martinez said. Major exports include medical devices, software, health care products and technology and industrial machinery.

Import business, especially wines and seafood, amounts to about $600 million a year, he said.

"Chile is a market that will grow more," Martinez said. "We presented Chile as a market of opportunity for the Tampa Bay area. It's already a stable, open market, and it will be even more open with the free trade agreement."

The videoconference gave area businesses an overview of the Chilean marketplace and a briefing of the country's economic conditions. Later this year, interested companies will be matched with Chilean businesses via one-on-one videoconferences.

But Nicholas Vouris, sales manager of Santech Inc. in Clearwater, is not waiting.

He attended the videoconference and already drafted a letter to a business specialist at an embassy in Chile, seeking more information and possible contacts.

"We want to develop our business," he said. "We'd like to get representation down there."

Santech employs 25 and manufactures standard and customized light-emitting diode display scoreboards and game monitoring equipment, message boards and video-projected displays.

The company's international projects include scoreboards and similar products in Venezuela, Egypt and China and at the University of Guadalajara, Mexico.

"We have sold all over the world, but 95 percent of our business is through ad agencies or on the Internet," Vouris said. "We're passive marketers and want to change that. The video conference was a good start."

Martinez plans to offer a videoconference with commercial service business specialists in China to counteract the reluctance to travel because of severe acute respiratory syndrome.

"We can help companies continue to do business in China," he said. "They can meet and conduct business virtually."

To reach Jane Meinhardt, call (813) 342-2476 or send your e-mail to jmeinhardt@bizjournals.com.

The Washington Post Outlook • Argentina, Shortchanged: Former World Bank economist Joseph Stiglitz explains why the once-prosperous country is in economic meltdown: because it followed the advice of the International Monetary Fund. News from Argentina • Argentina's President-Elect Seeks Allies (Reuters, May 15, 2003) • Argentines Doubtful About New President (Associated Press, May 15, 2003) • Argentines Have Doubts About New Leader (Associated Press, May 15, 2003) • Argentina's President-Elect Scours for Support (Reuters, May 15, 2003) • Injuries Force Russia to Pull Out of ATP Event (Reuters, May 15, 2003) • Why the Hemisphere Resists Most Latin American countries are opting out the Bush administration's war on terrorism.   

Washington Post Foreign Service Friday, May 16, 2003; Page A24

BUENOS AIRES -- Claudio Gerosa has done well for himself. His consulting business all but sprouted wings in the 1990s, growing by 500 percent as he and his partners helped foreign businessmen sell soft drinks, cars, televisions and other merchandise. Gerosa's income quadrupled. He stashed some but spent gobs more: He took the family to Disney World, went through eight cars in 10 years and bought a new home.

"I'm not the kind of guy who hides his money under his mattress," said Gerosa, a tanned and affable man. "I like to spend it."

Enrique Saavedra, 44, is a year older than Gerosa and agonizingly poorer. The past decade was not nearly as kind to him, as the deluge of better-made foreign goods into the country cost him not one factory job but two. Since 1999, he has made a living -- for lack of a better word, he says -- rummaging through garbage for cardboard, cans and other recyclables to sell for a few pennies per pound. He says he earns about $50 a month. Even with the recession, Gerosa says that he earns the equivalent of between $1,000 and $2,000 monthly, down from a peak of $5,000 in the 1990s, but still enough for a middle-class lifestyle.

"We live like animals now," said Saavedra, wiry as a bantamweight and the father of a 9-year-old boy. "What I do to survive is what a stray dog does to survive. I was much better off 10, 11 years ago than I am today. It's like I'm living my life in reverse."

The differing fortunes of the two men provide a vivid illustration of how Argentina's effort to plug into the global economy has split this comfortably middle-class country in two: one well-off and hungry for more, the other wretchedly poor and hungry.

The gap in incomes between Argentina's richest and poorest families is now more than 10 times what it was just 15 years ago. According to government statistics, the wealthiest 10 percent of Argentina's population earned nearly 178 percent more than the country's poorest 10 percent last year; in 1988, the margin was only 18 percent.

It is an epic transformation for a country that has not known pervasive poverty since the Great Depression and has largely avoided the abyss that divides rich from poor in such other Latin American countries as Brazil, Mexico and Venezuela. And it is that growing division that largely fueled the backlash against former president Carlos Menem, who abandoned his bid Wednesday to win a third presidential term. Opinion polls had showed Menem trailing Nestor Kirchner -- now the president-elect -- by margins in the double digits. Under Argentine election law, Kirchner, who qualified for a runoff election by finishing second to Menem in a field of five major candidates in the first round of balloting on April 27, won the presidency when Menem dropped out.

Just a decade ago, Argentina's middle class made up 80 percent of the population, according to government statistics. The unemployment rate had not eclipsed 5 percent since the 1940s, when Juan Peron's government expanded the rights of labor unions, extended government control over domestic industries and modernized the welfare system.

In 1993, however, Argentina's unemployment rate surpassed the 5 percent barrier for the first time in more than 60 years and has continued to climb. Economists estimate that a quarter of Argentina's workforce is jobless.

When Menem was elected in 1989, he sold virtually all of the country's state-run industries, pegged the value of the peso to that of the dollar to quell inflation and borrowed heavily from international lenders such as the World Bank and International Monetary Fund. Those policies yielded a potent but short-lived growth spurt in the 1990s, at once raising the ceiling on possibilities for the educated and well-connected while removing the floor underneath blue collar workers.

Argentina's economy contracted by 10.9 percent last year. That, coupled with its default on nearly $141 billion in foreign debt payments and the devaluation of the peso by nearly 70 percent 16 months ago, has dried up foreign investment.

Thu May 15, 9:14 PM ET

CARACAS, Venezuela (<a href=story.news.yahoo.com>Reuters) - Venezuela's tight foreign exchange controls have stopped the South American country's candidate from competing in the Miss Universe (news - web sites) beauty pageant, her main sponsor says.

Venezuela's private television channel Venevision said on Thursday that Miss Venezuela -- brown-haired Mariangel Ruiz -- would not attend the Miss Universe contest in Panama on June 3 because they were unable to obtain the hard currency needed to send her.

Venevision, which traditionally sponsors the country's candidates, sent a letter on Thursday to the president of the Miss Universe Organisation, Paula Shugart, advising her that Ruiz would not be going.

"We are all saddened that Mariangel Ruiz (Miss Venezuela 2003) will not be participating. Venezuela has a very strong following and the country's absence this year will be deeply felt," Shugart responded in a statement sent to Reuters by Venevision.

Venezuelan women have had a remarkable success in such contests, winning four Miss Universe crowns, five Miss World (news - web sites) crowns and three Miss International crowns.

Left-wing President Hugo Chavez introduced stringent foreign exchange controls more than three months ago to stem heavy capital flight and a slide in the bolivar currency triggered by an opposition strike in December and January.

Ruiz told Globovision television she was still hoping a last-minute arrangement could allow her to compete in Panama. "I represent a dream and a hope for Venezuela," she said.

Sao Paulo, May 15 (<a href=quote.bloomberg.com>Bloomberg) -- Brazil's real took its biggest plunge since January on concern its 19 percent gain in 2003 may prompt the government to bolster the U.S. currency to safeguard the growth of Brazilian exports.

The real fell 2.7 percent to 2.967 per dollar, the biggest drop since Jan. 24. The real remains the best performing currency in 2003 among the 59 tracked by Bloomberg even after its three- day, 3.6 percent decline. Mexico's peso fell to a two-week low.

There is this concern exporters and the government may push to prevent the real from strengthening further,'' said Sergio Machado, head of the Treasury desk at Banco Fator SA in Sao Paulo. Banks are trading on this speculation.''

President Luiz Inacio Lula da Silva's government is divided over the stronger real's possible effect on export growth, which may account for half of the Brazilian economy's projected 2.5 percent growth in 2003. While exporters have suggested the government take steps to weaken the real, a slowdown in inflation has prompted calls for the central bank to lower lending rates from a four-year high to boost domestic demand and growth.

Over the last week, the currency has traded in a range of 2.8425 to 2.9680 to the dollar as exporters buy reais as the real strengthens and importers buy dollars as it weakens.

``The great discussion over recent days has been the right level for the dollar that will preserve the trade balance and allow inflation to come down,'' said Clive Botelho, treasury director at Banco Santos SA.

Botelho and other investors say a rate cut would pare local banks' returns on Brazilian government securities engineered by raising money at low rates abroad to buy Brazilian Treasury debt.

Rates

Rates were raised five times since October from 18 percent to 26.5 percent as last year's 35 percent decline in the real sent inflation soaring to 12.53 percent, the highest 12-month rate since September 1996.

Botelho said many investors expect interest rates to come down in the second half, loosening up cash to buy dollars.

``We expect to see some significant decompression of monetary policy in the second half -- everyone's aware of that.''

Brazil's benchmark 8 percent bond that matures in 2014 fell for a second day, losing 2.44 cents on the dollar to 86.69, raising its yield to 11.36 percent, according to J.P. Morgan Chase & Co. The bond rose to a record high 91.75 on May 13.

Mexico

Mexico's peso fell a second day, a 3.2 percent since Tuesday, as lower interest rates and weakness in the U.S. economy prompted investors to sell pesos. The currency extended declines after the government said the economy contracted in the first quarter.

The peso fell 1.6 percent to 10.4370 per dollar. Earlier, the peso fell 1 percent as the day's trading opened, then reversed declines to rise 0.4 percent, before the afternoon's decline. The peso rose as high as 10.1075 yesterday.

The currency's two-day slide follows the decline of Mexican Treasury bill yields to record lows and the worst retail sales figures since 1991 in the U.S. The narrowing of the difference between U.S. and Mexican debt yields combined with the prospects of slower growth in Mexico's biggest export market have investors reluctant to hold pesos now, said Adam Weiner, Latin American strategist with AIG Trading Group in Greenwich, Connecticut.

People are concerned interest rates are at an all time low,'' said Weiner. At a certain point, people say the carry isn't as good as it was.''

Mexican Treasury-bill yields on May 13 fell to a record low at a government debt auction, which may signal that demand for peso-denominated securities will start to slow as interest rates fall below the inflation rate, analysts said.

Historic Lows

The 28-day Treasury bill's yield fell to 4.90 percent, its lowest ever, down from 9.7 percent in March while the 91-day bill' yield dropped to 5.59 percent from 6.19 percent a week ago.

Even with yields on U.S. Treasuries at four-decade lows --the 10-year's yield fell to 3.52 percent yesterday -- Mexican securities no longer offer the large returns of earlier this year that helped the peso rebound from a record low in March.

The Mexican government's report this afternoon that the county's economy shrank 0.49 percent in the first quarter helped extend the peso's decline.

Mexico has more to lose from slower growth in the world's largest economy than most other Latin American economies.

The U.S. buys about 85 percent of Mexico's $160 billion in annual exports, representing about a fifth of its $600 billion gross domestic product, and provides about 70 percent of the country's foreign investment.

Investors with a short-term interest in Mexico are pulling back some of their large peso positions now, explaining the speed of the drop, said Nathaniel Karp, an analyst at Grupo Financiero BBVA Bancomer SA in Mexico City.

There are no other investors with money to move the market like this,'' said Karp. They were coming in pretty hard, pretty strong before, and they were going to leave sooner or later.''

Colombia, Chile

Colombia's peso rose for the fifth day in six on investor expectations the country's central bank will keep its benchmark lending rate unchanged at its weekly meeting tomorrow.

The peso rose 1.3 percent to 2,806.50 per dollar after its 1.1 percent slide yesterday to a 2842.00 close. The peso has gained 2.1 percent against the dollar in 2003 after declining 21 percent last year.

The bank has raised its so-called repurchase agreement rate twice this year to 7.25 percent to slow accelerating inflation and a third increase might threaten growth.

Investors bought dollars yesterday after President Alvaro Uribe said he was concerned about the peso's 6.2 percent gain since January.

Many exporters fret the peso's rise may make Colombian exports less competitive abroad and derail a domestic economic expansion the government forecasts to reach 2 percent in 2003.

Chile's peso fell for the fourth day in five, losing 0.5 percent to 706.05 per dollar from 702.85 per dollar yesterday, paring its gain on the year to 2 percent.

Argentina's peso fell 1.3 percent to 2.8375 per dollar.

Peru's new sol was little changed at 3.4758 per dollar from 3.4749 per dollar yesterday. Venezuela fixed its bolivar at 1,598 per dollar earlier this year.

Last Updated: May 15, 2003 19:34 EDT

ALEXANDRA OLSON, Associated Press Writer Thursday, May 15, 2003
(05-15) 17:08 PDT CARACAS, Venezuela (<a href=www.sfgate.com>AP) --

Venezuela on Thursday accused the American ambassador of acting "irresponsibly" by hosting a conference on press freedoms during which foes of Hugo Chavez made fun of the president.

Vice President Jose Vicente Rangel said Venezuela would not allow the incident to further damage already rocky relations with the United States.

Ambassador Charles Shapiro hosted a gathering of Venezuelan journalism associations and unions at his residence Tuesday.

At the meeting, Shapiro expressed concern about "deteriorating press freedoms" in Venezuela, citing unpunished attacks on dozens of journalists last year. Also during the meeting, a humorist disguised as a prominent anti-Chavez journalist held up a puppet of Chavez and ridiculed the president.

"What is the purpose of putting on this show? Offend the government? Offend the president? I think it's the Venezuelan people who were offended," Rangel said.

Rangel said Venezuela would consider the event an act of "personal irresponsibility" on Shapiro's part. But he urged the United States to explain Shapiro's behavior, saying Venezuela couldn't dismiss the possibility that Washington was deliberately trying to provoke Chavez's government.

In a statement released Thursday, the U.S. embassy said it "regretted that some people felt offended" by the event.

The humorist's presentation "seemed to us in bad taste because of its political content," the statement said. "The embassy does not know in advance nor does it censure what its guests are going to say, whether it's an invited speaker or humorist."

"The words of Ambassador Shapiro, and no one else's, express the point of view of the United States embassy," it added.

Relations between the United States and Venezuela have often been tense during Chavez's four-year government.

In 2001, the Venezuelan leader criticized civilian casualties in the U.S.-led attack on Afghanistan. The leftist former paratrooper has irked Washington by strengthening ties with Cuba and Libya. In 2000, he became the first head of state to visit then-Iraqi leader Saddam Hussein after the 1991 Gulf War.

Relations also suffered after the United States initially blamed Chavez for his own downfall during an April 2002 coup that briefly ousted the Venezuelan president from office. Washington belatedly condemned the coup.

The United States is also uncomfortable with Chavez's criticism of the U.S.-led efforts to establish a free trade zone stretching from Alaska to the southern tip of South America.