Latin America Water Segment Webinar Presentation

Embed Size (px)

Citation preview

  • 8/3/2019 Latin America Water Segment Webinar Presentation

    1/56

    Webinar Presentation on LatinAmerica Water Segment

    Vince Lencioni

    LGA Consulting

    January 26, 2011

  • 8/3/2019 Latin America Water Segment Webinar Presentation

    2/56

    Webinar Outline

    110 minutes followed by Questions & AnswersAgenda: 5 partsA. Greater Commitment to Regin 15 minutes

    Latin America comparisons with Asian Economies

    B. Intermediary Options and Channel Analysis 20 minutes Traditional Approaches to Market Channel mix options: pros and cons

    C. Local Presence and Legal Analysis 25 minutes Pros and Cons of different Latam locations

    Mexico, Brazil, Chile presence and legal comparisons

    D. Market Analysis 40 minutes Brazil, ROSA, Mexico General and Water Analysis Need for Right People and Right Information

    E. LGA Consulting, TVZ International, Trade Chile 10 minutes

    Service and Assistance Channel Support Program

    Contact and Descriptive Information about companies

  • 8/3/2019 Latin America Water Segment Webinar Presentation

    3/56

    I. Latin America vs Asia Republics:

    Stats and Comparisons that Stick

    Arguments for why Latin America should be just asdynamic, important as Asian Republics (minus Chinaand Japan) Why companies should be emphasizing region more in

    general and vs Asian investment

    Red Headed Step Child (Latam) vs the Favorite Child (Asia)

    Indicators Analyzed: GDP (overall, increase, percapita, PPP), Inflation, Imports, US Exports,Population, Corruption, Ease of Doing Business

  • 8/3/2019 Latin America Water Segment Webinar Presentation

    4/56

    Asia vs Latin America: GDP 2012

    Top 10 Latam Economies =Japan, 75% of China, 3x

    India, > Rest of Asia(minus China and Japan)

    Brazil = 1/3 of China

    India or Russia = Brazil

    Brazil = South Korea, Thailand,

    Taiwan, Malaysia, Vietnam

    Mexico = Taiwan, Thailand,Malaysia and Vietnam

    Mexico = 2/3 of India or Russia

    South Korea = 90% Mexico

    Argentina = of Indonesia

    Argentina = 85% of Taiwan

    Malaysia = Chile

    Thailand = Colombia or

    VenezuelaVietnam = 2/3 of Peru or

    Central America

    Source: International Monetary Fund, World Economic Outlook , September 2011

    http://www.imf.org/external/data.htm(see annexes)

    http://www.imf.org/external/data.htmhttp://www.imf.org/external/data.htm
  • 8/3/2019 Latin America Water Segment Webinar Presentation

    5/56

    Asia vs Latin America: GDP % 2012

    China 9.5%India 7.8%

    Indonesia* 6.5%Vietnam* 5.7%SoKorea,Taiwan,Thailand 4.2%Malaysia 4.0%Japan 2.1%---------------------------------------* = Small or significantly

    underdeveloped economies

    Latin America > 4.2%Panama* 6.9%

    Dom Republic*6.4%Peru 4.9%Chile 4.8%Colombia & Ecuador 4.5%Brazil 4.2%Uruguay* 4.2%Argentina 4.1%Mexico 3.5%Venezuela 2.3%

    Source: International Monetary Fund, World Economic Outlook , September 2011

    http://www.imf.org/external/data.htm(see annexes)

    http://www.imf.org/external/data.htmhttp://www.imf.org/external/data.htm
  • 8/3/2019 Latin America Water Segment Webinar Presentation

    6/56

    Asia vs Latin America: Population

    India + China = 4x Latam

    India = of Latin America

    Japan = 2/3 of Brazil

    Brazil = Japan, South Koreaand Taiwan

    Mexico = of Indonesia

    Mexico = Malaysia + Vietnamor Japan

    Argentina = 2/3 of South Koreaor 2/3 of Thailand

    Malaysia = 2/3 ArgentinaVietnam = Argentina+Colombia

    Colombia = of Thailand or90% of South Korea

    Malaysia = Venezuela or Peru

    Chile = 2/3 of Malaysia

    Source: Business Monitor, Latin America Monitor, Vol. 28 Issue11 November 2011

  • 8/3/2019 Latin America Water Segment Webinar Presentation

    7/56

    Asia vs LatAm: GDP Per Capita 2012

    South Korea $23,749

    Taiwan $23,379

    Malaysia $ 9,146

    Thailand $ 5,865

    China $ 5,715

    Indonesia $ 3,469India $ 1,645

    Vietnam $ 1,521

    Uruguay $15,714

    Chile $13,998

    Brazil $13,316

    Argentina $11,358

    Mexico $11,210

    Venezuela $10,265Colombia $ 7,294

    Peru $ 5,880

    Source: International Monetary Fund, World Economic Outlook , September 2011

    http://www.imf.org/external/data.htm(See Annexes)

    http://www.imf.org/external/data.htmhttp://www.imf.org/external/data.htm
  • 8/3/2019 Latin America Water Segment Webinar Presentation

    8/56

    Latin America vs BRIC: GDP PPP

    GDP PPP

    0.00

    5,000.00

    10,000.00

    15,000.00

    20,000.00

    25,000.00

    2008 2009 2010 2011 2012 2015

    Year

    USd

    ollars

    Brazil

    China

    India

    Mexico

    Russia

    Source: Elaborated with data of International Monetary Fund & WEO September(2011)

  • 8/3/2019 Latin America Water Segment Webinar Presentation

    9/56

    Mexico vs BRIC: Working Age

    Source:www.ajr.com.mx, 6thcongress with data of WORLD FACT BOOK, 2011

    http://www.ajr.com.mx/http://www.ajr.com.mx/
  • 8/3/2019 Latin America Water Segment Webinar Presentation

    10/56

    Asia vs LatAm: Imports 2010

    Latam top 9 plus CentralAmerica* = 75% China

    Mexico = 30% of China

    Brazil = 16.5% of China

    India = 35% of Latam*

    India = 93% of MexicoBrazil = 60% of India

    Mexico = 60% of Japan

    Chile = of Malaysia or of Thailand

    Taiwan = of Latam*

    Russia = of Latam*

    Argentina + Colombia = of Russia or Taiwan

    Vietnam= Central Americaor Peru + Venezuela

    Source: Central Intelligence Agency, The World Factbook, December

    2011https://www.cia.gov/library/publications/the-world-factbook/(see annexes)

    https://www.cia.gov/library/publications/the-world-factbook/https://www.cia.gov/library/publications/the-world-factbook/https://www.cia.gov/library/publications/the-world-factbook/https://www.cia.gov/library/publications/the-world-factbook/https://www.cia.gov/library/publications/the-world-factbook/https://www.cia.gov/library/publications/the-world-factbook/
  • 8/3/2019 Latin America Water Segment Webinar Presentation

    11/56

    Asia vs LatAm: US Exports 2011

    Mexico = 2x China, 3xJapan, 4.5x South

    Korea, 9x India, morethan top 10 Asiancountries after China

    Brazil = South Korea, 2x

    India, almost half ChinaChile = of India

    Thailand = 2/3 of Chile

    Colombia = Malaysia, 2/3of India

    Argentina = of India

    Panama or Peru = Russiaor Indonesia

    Venezuela > Thailand

    Costa Rica = Thailand

    Paraguay = Vietnam

    Source: US Census Bureau, Foreign Trade, September (2011)http://www.census.gov/foreign-trade(see annexes)

    http://www.census.gov/foreign-tradehttp://www.census.gov/foreign-tradehttp://www.census.gov/foreign-tradehttp://www.census.gov/foreign-trade
  • 8/3/2019 Latin America Water Segment Webinar Presentation

    12/56

    LatAm vs BRIC Inflation 2010

    Source:www.ajr.com.mx, 6thcongress with data of WORLD FACT BOOK, 2011

    http://www.ajr.com.mx/http://www.ajr.com.mx/
  • 8/3/2019 Latin America Water Segment Webinar Presentation

    13/56

    Asia vs LatAm: Corruption 2011

    Source: Corruption Perceptions 2011, Novemberwww.transparency.org,

    http://www.transparency.org/http://www.transparency.org/
  • 8/3/2019 Latin America Water Segment Webinar Presentation

    14/56

    Asia vs LatAm: Corruption

    Source: Corruption Perceptions 2011, Novemberwww.transparency.org

    http://www.transparency.org/http://www.transparency.org/
  • 8/3/2019 Latin America Water Segment Webinar Presentation

    15/56

    Asia vs Latin America: Ease of Doing

    Business Report, World Bank 2009-12

    South Korea: 8, up 15

    Thailand: 17, down 5

    Malaysia: 18, up 3

    China: 91, down 5

    Vietnam: 98, down 8

    Indonesia: 129, sameIndia: 132, same

    (Venezuela: 177)

    Chile: 39, same

    Peru: 41, up 24

    Colombia: 42, up 7

    Mexico: 53, up 2

    Panama: 61, up 22

    Uruguay 91, up 19Argentina: 113, same

    Brazil: 125, same

    Source: The World Bank Group, International Finance Corporation, Doing Business, June2011 http://www.doingbusiness.org/rankings

    http://www.doingbusiness.org/rankingshttp://www.doingbusiness.org/rankings
  • 8/3/2019 Latin America Water Segment Webinar Presentation

    16/56

    II. Traditional Latin America Approach

    and New Channel Outlook

    Strategy: Create market presence not marketshare Focus: Mexico > South America

    Little or no regional research or businessdevelopment, rely on channels for information

    Stay away from local presence if possible; locate

    intermediaries, leave alone to do their job Supervise all activities from US maybe with

    bilingual staff, probably without Latam person

  • 8/3/2019 Latin America Water Segment Webinar Presentation

    17/56

    Regional Channel Analysis (Part 1)

    Options Distributor vsRep vs Integrator

    Challenges Credit & Terms

    Price/Discounts Price vs Credit

    Margins & Commissions

    Technical Service

    Visits Client/Intermed

    Exclusivity both ways

    Intermediary Tendency Mexico

    Brazil Chile/ROSA

    Base for Coverage From US

    From Miami

    From Brazil

    From Mexico

    From ROSA

  • 8/3/2019 Latin America Water Segment Webinar Presentation

    18/56

    Regional Channel Analysis (Part 2)

    Industry vs Govt Sales Brazil vs Mexico Commercial vs Strategic

    Alliance Reps - Challenges

    Identification How/Where Unprofessional Business Dev. Commitment

    Distributors-Challenges Viability: Logistics & cashflow

    for importing, stocking Margins Order-Takers Bad Market Information Broader focus in Latam

    Double Coverage Pros & Cons: Rep driving

    Intermediaries: adding layers

    vs coverage Direct Sales Office

    Better supervise, motivatechannels more visits

    Joint Calls, Support

    Not rely on others for marketinfo or business development

    Need to pull clients throughintermediaries Better than US based staff

    Travel, Expertise, Living inRegion, Visits (both)

    Results = 3x Sales Potential

  • 8/3/2019 Latin America Water Segment Webinar Presentation

    19/56

    III. Presence and Analysis of Options

    Local Presence and Base of Operations

    Strategic, Tactical, Business Rationale Territorial Challenges: Brazil, Southern Cone,

    Andean, Central America, Mexico

    US vs Brazil and/or Mexico and ROSA options

    Legal, Fiscal and Incorporation Analysis:Mexico and Brazil

    Comparative Costs, liabilities; water issues

  • 8/3/2019 Latin America Water Segment Webinar Presentation

    20/56

    A. Mexico Presence / Legal Issues

    Strategic Presence Issues Rationale for assembly: Price > Tropicalization (2) or Latam export base

    Exception: Sales to Government although integrated 40% allows viable access

    Pros & Cons: Mexico Base for Central America, Andean, LatAm Sales: Distributors & Integrators vs Reps vs Direct Presence

    Options: Incorporation, Acquisition, Strategic Alliance Costs, Time Frames, Strategies

    Banking, Accounting, Fiscal Realities almost all Federal Costs, RFC, Taxes (VAT, ISR, IETU), Remittances, Transfer Pricing/Audits

    Employees vs Reps Costs, Severance Liabilities Credit, Payments, Terms, and Guarantees Water Segment Legal & Regulatory Concerns

    Restrictions on selling to govt: Mexican company, Mexican content Others: NOMs, Getting paid, PPP/BOT, Intellectual Property

  • 8/3/2019 Latin America Water Segment Webinar Presentation

    21/56

    Mexico Investment Syndromes

    Entrada Group Syndrome Current Investors growing, new staying away

    Volkswagon Syndrome Obligation to vendors to relocate to Mexico

    Return from China JIT & Logistics Syndrome Many companies returning to Mexico

  • 8/3/2019 Latin America Water Segment Webinar Presentation

    22/56

    B. Brazil Presence

    Strategic Presence Issues Rationale for assembly: Nationalism, Price and Rosa export base Pros & Cons: Brazil Base for Mercosur, Chile, Andean

    Sales: Distributors & Integrators vs Reps vs Direct Presence Issues Similar to Mexico Options: Incorporation, Acquisition, Strategic Alliance

    Costs including state environmental license, Time Frames, Strategies

    Accounting and Fiscal Realities Federal & State Costs, RFC number (CNPJ), Taxes (VAT 2, Income 2), Remittances,

    Employees vs Reps Costs, Severance Liabilities Credit, Payments, Terms, and Guarantees Water Segment Legal & Regulatory Concerns

    Subsidies and Informal restrictions on selling to govt Others: Standards, Getting paid, PPP/BOT, Intellectual Property

  • 8/3/2019 Latin America Water Segment Webinar Presentation

    23/56

    C. Chile Presence

    Strategic Presence Issues Rationale for assembly: Price, better serve Rosa, easier to do business Pros & Cons: Chile Base for Mercosur and Andean regions

    Sales: Distributors & Integrators vs Reps vs Direct Presence Issues Similar to Mexico Options: Incorporation, Acquisition, Strategic Alliance

    Costs including state environmental license, Time Frames, Strategies

    Accounting and Fiscal Realities Federal & State Costs, Taxes (VAT 2, Income), Remittances,

    Employees vs Reps Costs, Severance Liabilities Credit, Payments, Terms, and Guarantees Water Segment Legal & Regulatory Concerns

    Transparency and lack of restrictions on selling to govt Others: Getting paid, PPP/BOT, concession dynamic strong

  • 8/3/2019 Latin America Water Segment Webinar Presentation

    24/56

    IV. Latin America Market Analysis

    Brief review of regional market size

    Brazil vs ROSA vs Mexico General Issues

    Imports by Category

    Water Issues

    ROSA Market Rankings If Time: Mexico Misconceptions

  • 8/3/2019 Latin America Water Segment Webinar Presentation

    25/56

    Latin America Economic Importance

    2009 2010 2011 2012

    4,106 4,820 5,526 6,166

    -1.7 6.1 4.4 40.724 0.91 0.995 1.09

    Real GDP growthImports (US$ Trilllon)

    GDP (US$ bn)

    Latin American Indicators

    Source: International Monetary Fund, Data Base September 2011

    * forecast (Argentina growth rate adjusted down)

    GDP current prices US Growth %

    Country 2010 2011* 2012* 2009 2010 2011* 2012*

    USA 14,526.6 15,064.8 15,495.4 -3.486 3.03 1.527 1.782

    Brazil 2,090.3 2,517.9 2,617.0 -0.645 7.49 3.769 4.125

    Mexico 1,034.3 1,185.2 1,242.2 -6.161 5.416 3.79 3.605

    Argentina 370.0 435.2 468.9 0.835 9.161 7.987 4.121

    Colombia 289.4 321.5 339.9 1.452 4.289 4.87 4.463

    Venezuela 293.3 309.8 311.7 -3.202 -1.489 2.832 3.594

    Chile 203.3 243.0 246.5 -1.676 5.193 6.545 4.745

    CentralAmerica 152 167 184 -0.5 3.9 3.9 3.9

    Peru 153.8 168.5 179.2 0.862 8.794 6.245 5.571

  • 8/3/2019 Latin America Water Segment Webinar Presentation

    26/56

    A. Brazil Market Analysis

    Regional Analysis

    Population: Size, per capita GDP, Mentality Dos and Donts

    No presence Options

    Imports: Dynamic, Costs, Financing

  • 8/3/2019 Latin America Water Segment Webinar Presentation

    27/56

    Brazil Imports, % Increases

    Brazil Imports by Sector

    Consumer goods Intermediary goods Capital Goods

    2005 8,477 45,386 15,379

    2006 11,986 41.4% 54,228 19.5% 18,891 22.8%

    2007 16,058 34.0% 70,413 29.8% 25,113 32.9%

    2008 22,519 40.2% 99,883 41.9% 35,910 43.0%

    2009 21,500 -4.5% 71,642 -28.3% 29,675 -17.4%

    2010 31,405 46.1% 100,731 40.6% 40,981 38.1%2010(January-March) 6,544 NA 21,793 NA 8,273 NA

    2011(January-March) 8,711 33.1% 26,652 22.3% 10,704 29.4%

    Source: CEI 2011Centro de Economia Internacional, Comercio Exterior Por Sectores,Trim(1993-2011), http://www.cei.gov.ar/node/26

  • 8/3/2019 Latin America Water Segment Webinar Presentation

    28/56

    SOCIO ECONOMIC GROUPS

    GROUPS BRAZIL MEXICO

    % ofPopulation Population

    % ofPopulation Population

    A/B 14% 28,480,168 6.8% 7,733,247

    C+ 15% 30,514,466 14.2% 16,148,840

    C 21% 42,720,252 17.0% 19,333,118

    D+ 22% 44,754,550 35.6% 40,485,824D/E 28% 56,960,336 26.4% 30,023,196

    Mexico vs Brazil Groups

    Note: Brazil data = 2007 (pre-crisis); Mexico data = 2010 (post-crisis)

    Class designations between Brazil and Mexico are not completely consistent;Example: Brazil B salary levels above $2,764; Mexico C+ salaries above $ 3,267

    Source: Lopez, Heriberto, AMAI Congress (2011); ICEX 2010

  • 8/3/2019 Latin America Water Segment Webinar Presentation

    29/56

    Mexico Water Challenges = Brazil too?

    1. Geographical Issues: North (30/87/75) vs South (70/13/25)Altitude, precipitation, population, urban growth issues

    2. Per Capita Water: 4,400 m3 (2010): 15,000 South vs 500 North

    3. Overexploited aquifers: 15%; will reach 25% soon

    4. Water Use: 80% Agri (US: 40%) vs 8% Industrial (US: 46%)

    5. Delivery Systems: 50% losses: Potable (43%), Agri (55%)

    6. Wastewater Treatment: < 40% Municipal; < 20% IndustrialPotable (91%), Sewerage (87%) Coverage Up, Treatment next

    7. System efficiency = Medium to lower half of Latin America

  • 8/3/2019 Latin America Water Segment Webinar Presentation

    30/56

    Brazil: Water Focus

    Industrial Regulatory Environment

    Industrial Sectors

    Residential Water

    Import Activity

    Examples (2)

    Shows: Fimai, Fitabes

    Government Corruption, Slowness

    Potable, Sewerage andTreatment Coverage

    Wastewater vs PotableCommitments

    PPP/BOT growth

    Integrator dynamic

    Barriers: Formal/Informal

  • 8/3/2019 Latin America Water Segment Webinar Presentation

    31/56

    B. ROSA Market Analysis

    Regional Analysis

    Population: Size, per

    capita GDP, Mentality Dos and Donts

    Imports: Dynamic,Costs

    Presence andCoverage Issues

    Countries: Chile Great but small

    Argentina Large andcomplex, Brazil shadow

    Colombia New target,good size & potential

    Venezuela

    problematic, small,Industry (oil) only

    Peru Growing, small,still unclear potential

  • 8/3/2019 Latin America Water Segment Webinar Presentation

    32/56

    MARKET RANKING

    Chile Colombia Argentina Peru Venezuela

    GDP 4 2 1 5 3

    GDP % Increase 2 3 4 1 5

    Per Capita GDP 1 4 2 5 3

    Population 5 1 2 3 3

    Imports 1 3 2 5 4

    US Exports 1 2 4 5 3

    Corruption 1 2 4 3 5

    Ease Business 1 3 4 2 5

    TOTAL 16 20 23 29 31

    ROSA Market Rankings

    Source: Elaborated with data from Rosa Market Rankings

  • 8/3/2019 Latin America Water Segment Webinar Presentation

    33/56

    ROSA: Water Focus

    ROSA Regin and Country Analysis

    Corruption, Barriers, Slowness

    Regulatory Environment & Industrial treatment

    Potable, Sewerage and Treatment Coverage

    Potable Commitment and Residential Water

    PPP/BOT growth Integrator/Intermediary dynamic

  • 8/3/2019 Latin America Water Segment Webinar Presentation

    34/56

    C. Mexico Market Analysis

    Regional Analysis

    Population: Size, per capita GDP, Mentality Dos and Donts

    Imports: Dynamic, Costs

    Misconceptions and Insecurity

  • 8/3/2019 Latin America Water Segment Webinar Presentation

    35/56

    Mexico Imports, % Increases

    Mexico Imports by Sector

    Consumer goods Intermediary goods Capital Goods

    2005 31,513 164,091 26,216

    2006 36,901 17.1% 188,633 15.0% 30,525 16.4%

    2007 43,055 16.7% 205,296 8.8% 33,599 10.1%

    2008 47,941 11.3% 221,565 7.9% 39,097 16.4%

    2009 32,828 -31.5% 170,912 -22.9% 30,645 -21.6%

    2010 41,423 26.2% 229,812 34.5% 30,247 -1.3%2010 (Jan-Nov) 37,215 NA 209,909 NA 27,239 NA

    2011 (Jan-Nov) 47,567 27.8% 242,562 15.5% 31,579 15.9%

    Source: INEGI. (2011):www.inegi.gob.mx/prod_serv/contenidos/espanol/bvinegi/productos/continuas/economicas/exterior/mensual/

    ece/ecem.pdf

  • 8/3/2019 Latin America Water Segment Webinar Presentation

    36/56

    Mexico: Water Focus

    Industrial Regulatory Environment

    Industrial Sectors

    Sub Segment Estimates

    Residential Water

    Import Activity

    Examples: (2) Shows: ANEAS, Expo

    Green, Conagua Show

    Government Corruption, Slowness

    Potable, Sewerage andTreatment Coverage

    Wastewater vs PotableCommitments

    PPP/BOT growth?

    Integrator dynamic

    Barriers: Formal/Informal

  • 8/3/2019 Latin America Water Segment Webinar Presentation

    37/56

    Four Mexico Misconceptions

    1. Latin America/Mexico is insignificant vs. major markets US Market: Latam = 36%; Mexico/Brazil > 25%; Mexico = 10% Mexico: 2/3 India or Russia; 30% imports, 2x US exports: China

    3.Mexico is a less important market than BRIC markets 2011 US Exports as % of total: BRIC 14.9% Mexico 13.1%

    2011 US Exports % Increase: BRIC 18.6%; Mexico 22.6%

    2. Brazil is much more dynamic/important than Mexico

    GDP Growth, Brazil vs Mexico 2010: 7.5% vs 5.5%; 2011: 3.8% vs 3.8%; 2012: 3.6% vs 4%

    Brazil GDP = 2x Mexico BUT Brazil Imports = 2/3 of Mexico US Exports (2010) to Brazil = $35 B; Mexico = $165 B > 4.5x

    4. Mexico too insecure for business or for business travel

    Source:1)International Monetary Fund & WEO September(2011) 2)US Census Bureau, Foreign Trade,September (2011) http://www.census.gov/foreign-trade

    http://www.census.gov/foreign-tradehttp://www.census.gov/foreign-tradehttp://www.census.gov/foreign-tradehttp://www.census.gov/foreign-trade
  • 8/3/2019 Latin America Water Segment Webinar Presentation

    38/56

    Mexico Insecurity Issues

    2006-2011: 36,000 Murders, only 3% notpolice, military or cartel/crime members

    Mexico Country Risk: JPMorgan Rate 190 Brazil Rate: 232; Argentina 920 (November 2011)

    7 States most affected by insecurity getting

    more FDI than prior to 2006 AmCham: FDI in Mexico: Is your

    Investment Safe?Source: (1) Notimex, Mxico risk grows 12 points, November 2011 (2) Cattan, N. A newreport finds violence in Mexico Foreign Investment, August 2011 (3) American Chamber

    Mexico, Foreign Direct Investment in Mexico, June 2010.

  • 8/3/2019 Latin America Water Segment Webinar Presentation

    39/56

    Mexico in Context: Murders per CapitaWORST LATIN AMERICA COUNTRIES, MEXICAN AND US STATES

    HONDURAS 77 Oaxaca 21 New Mexico 8.7 Oklahoma 6.2Chihuahua* 74 Sonora* 20 Mexico City 8 Nuevo Leon# 6SALVADOR 70 Morelos 19 Guanajuato 8 Tabasco 6

    Durango* 60 MEXICO 18 Jalisco 8 Illinois 6VENEZUELA 48 Michoacan 18 Maryland 7.7 Georgia 5.8Sinaloa* 47 Nayarit 15 Tennessee 7.3 Florida 5.5Guerrero 46 Quintana Roo 13 Puebla 7 Arziona 5.4T&TOBAGO 37 Louisiana 11.8 Alabama 6.9 Texas 5.4COLOMBIA 32 Chiapas 10 Mississippi 6.4 California 5.3BRAZIL 25 Coahuila# 9 Missouri 6.4 Pennsylv. 5.2Wash D.C. 24 Mexico(State) 9 Michigan 6.3 Queretaro 5Baja Calif* 24 Tamaulipas# 9 So Carolina 6.3

    Puerto Rico 22.6 Colima 9 Arkansas 6.2

    Source: United Nations Office on Drugs and Crime Homicide Statics, Criminal Justice, List ofcountries by intentional homicide rate, 2010

  • 8/3/2019 Latin America Water Segment Webinar Presentation

    40/56

    Right Information, Right People

    Right Information Lots of Talk, Interest

    Market Info Availability

    Limited Info requests

    Complexity = more study

    Need more market andcompetition analysis

    Need to over-analyze

    margins & landed prices Too much from channels

    Need to create buy-in

    Right People Bilingual or Trilingual

    Technically & regionallyqualified staff

    Resourceful & Analytical

    Accountable with empathy

    Channels, marketing overdirect sales

    Latam person at home Local GMs: good in market

    & in home office

    Presence or Frequent Visits

  • 8/3/2019 Latin America Water Segment Webinar Presentation

    41/56

    V. Assistance and Services

    Hands On Water Sector-Focused Experience andServices: Channel, Sales/Client, Market, Legal NEW: Channel Support Program in Mexico

    Latin America Region-Wide Assistance Mexico LGA Consulting

    Legal: SDL Consulting

    Brazil TVZ International Legal: Furriela Advogados

    Chile/ROSA - Trade Chile

    Legal: Sateler Cia & Abogados

  • 8/3/2019 Latin America Water Segment Webinar Presentation

    42/56

    LGA Consulting Background

    Staff (4 + Administrative)

    Wisconsin Trade Office (Since 1994) General Business Consulting Hands on

    B2B/Industrial and Retail/Catalog

    Business & Channel Development

    SDL Consulting Sister Company

    Legal, Accounting, Regulatory

    Water Focus (see next slide)

  • 8/3/2019 Latin America Water Segment Webinar Presentation

    43/56

    LGA Consulting Water Focus

    15+ Years working with Wisconsin companies with products forMexico public and private water sector Market Analysis, Intermediary and Client Searches

    3+ years of formal & extensive regional water focus

    Mexico Water Report now with Latin America content

    Development of Mexican Water Intermediary contacts

    Distributors, Reps, Integrators, Contractors, EPCs (600+)

    Custom Analysis of Projects, Bid Winners & Bid Participants Public & Private Sector Water Project/Client Identification services

    WWEMA, WEF, WI, MN presentations on Mexico water segment

    Development of CAP (Channel Assistance Program) for segment

    Work with WEF & AWWA on Manufacturers Committee, Mexico City

  • 8/3/2019 Latin America Water Segment Webinar Presentation

    44/56

    LGA Latin America Collaborators

    TVZ International Brazil Coverage (1997)

    Based in Sao Paolo

    Long time collaboration withLGA

    Council of Great LakesOffice in Brazil;

    Representation: Wisconsin

    Associates with BrazilianLaw Firm: FurrielaAdvogados

    Report: Brazil Article

    Trade Chile Chile Coverage (1995) with

    Argentina, Peru, Colombia

    as well Based in Santiago

    Council of Great LakesOffice in Chile

    Representation: New York

    In-house legal council withwater focus: Sateler & CiaAbogados

    Report Chile Article

  • 8/3/2019 Latin America Water Segment Webinar Presentation

    45/56

    Collaborator Contact Information

    BRAZIL

    TVZ InternationalContact: Claudia Tomaselli

    [email protected]

    Tel: 5511-3010-8489 or 5511-3384-9051

    www.tvzinternational.com.br

    Chile, Argentina, Peru &Colombia

    Trade ChileContact. Veronica Medina

    [email protected]

    Tel: 5698 -2244-2435

    www.tradechile.cl

    mailto:[email protected]:[email protected]://www.tvzinternational.com.br/mailto:[email protected]://www.tradechile.cl/http://www.tradechile.cl/mailto:[email protected]://www.tvzinternational.com.br/mailto:[email protected]:[email protected]
  • 8/3/2019 Latin America Water Segment Webinar Presentation

    46/56

    Law Firm Contact Information

    BRAZIL

    Furriela AdvogadosContact: Fernando Furriela

    [email protected]

    Tel: 5511-3040-4900

    www.furriela.adv.br/English/

    CHILE

    Sateler Cia y AbogadosContact: Ricardo Sateler

    [email protected]

    Tel: 5698-2714-9900

    www.sateler.cl

    mailto:[email protected]://www.furriela.adv.br/English/mailto:[email protected]://www.sateler.cl/http://www.sateler.cl/http://www.sateler.cl/http://www.sateler.cl/http://www.sateler.cl/http://www.sateler.cl/mailto:[email protected]://www.furriela.adv.br/English/mailto:[email protected]
  • 8/3/2019 Latin America Water Segment Webinar Presentation

    47/56

    Contact Information

    LGA ConsultingVince Lencioni

    General Manager

    Email: [email protected]: www.lgaconsulting.com

    Mexico Water Report Electronic Access:

    http://www.lgaconsulting.com/water/report.html

    Mexico City Toll Free Number in the US:1-888-750-0988; or 011-52-555-378-3840 or 90

    mailto:[email protected]://www.lgaconsulting.com/http://www.lgaconsulting.com/water/report.htmlhttp://www.lgaconsulting.com/water/report.htmlhttp://www.lgaconsulting.com/mailto:[email protected]
  • 8/3/2019 Latin America Water Segment Webinar Presentation

    48/56

    Annexes

  • 8/3/2019 Latin America Water Segment Webinar Presentation

    49/56

    Asia vs Latin America: GDPGDP US$ bn current

    prices [2]

    2011f 2012f

    China 6,988.5 7,744.1

    Japan 5,855.4 6,125.8

    Russia 1,884.9 2,117.2

    India 1,843.4 2,012.8

    Korea (South) 1,163.8 1,275.0

    Indonesia 834.3 936.5Taiwan 504.6 551.3

    Thailand 339.4 379.2

    Malaysia 247.6 267.3

    Vietnam 121.6 137.5

    GDP US$ bn currentprices [2]

    2011f 2012f

    Brazil 2,517.9 2,617.0

    Mexico 1,185.2 1,242.2

    Argentina 435.2 468.9

    Colombia 321.5 339.9

    Venezuela 309.8 311.7

    Chile 243.0 246.5Peru 168.5 179.2

    Costa Rica 40.0 43.8

    Paraguay 22.3 26.9

    El Salvador 22.6 24.3

    Source: [2] International Monetary Fund, World Economic Outlook , September 2011http://www.imf.org/external/data.htm(see annexes)

    http://www.imf.org/external/data.htmhttp://www.imf.org/external/data.htm
  • 8/3/2019 Latin America Water Segment Webinar Presentation

    50/56

    Asia vs Latin America: GDP %

    GDP % real Growth [2]

    2011f 2012f

    China 9.6% 9.5%

    Japan 1.4% 2.1%

    Russia 4.8% 4.5%

    India 8.2% 7.8%

    Korea (South) 4.5% 4.2%

    Indonesia 6.2% 6.5%Taiwan 4.5% 4.2%

    Thailand 4.0% 4.2%

    Malaysia 4.7% 4.0%

    Vietnam 6.3% 5.7%

    GDP % real Growth [2]

    2011f 2012f

    Brazil 3.8% 3.6%

    Mexico 3.8% 3.6%

    Argentina 8.0% 4.6%

    Colombia 4.9% 4.5%

    Venezuela 2.8% 3.6%

    Chile 6.5% 4.7%Peru 6.2% 5.6%

    Costa Rica 4.0% 4.1%

    Paraguay 6.4% 5.0%

    El Salvador 2.0% 2.5%

    Source: [2] International Monetary Fund, World Economic Outlook , September 2011http://www.imf.org/external/data.htm(see annexes)

    http://www.imf.org/external/data.htmhttp://www.imf.org/external/data.htm
  • 8/3/2019 Latin America Water Segment Webinar Presentation

    51/56

    Asia vs Latin America: GDP Per Capita

    GDP Per Capita $US[2]

    2011f 2012f

    China 5,183.9 5,715.8

    India 1,527.3 1,645.5

    Indonesia 3,469.3 3,847.9

    Japan 45,773.8 47,960.1

    Korea (South) 23,749.2 25,948.8

    Malaysia 8,616.7 9,146.9Russia 13,235.6 14,918.1

    Taiwan 21,591.8 23,379.8

    Thailand 5,281.5 5,865.0

    Vietnam 1,361.6 1,521.2

    GDP Per Capita $US[2]

    2011f 2012f

    Brazil 12,916.90 13,316.21

    Mexico 10,802.85 11,210.29

    Argentina 10,639.95 11,358.32

    Colombia 6,980.43 7,294.35

    Venezuela 10,408.78 10,265.60

    Chile 13,969.51 13,998.72Peru 5,613.55 5,880.29

    Costa Rica 8,488.64 9,167.36

    Paraguay 3,421.12 4,032.59

    El Salvador 3,830.53 4,094.50

    Source: [2] International Monetary Fund, World Economic Outlook , September 2011http://www.imf.org/external/data.htm

    http://www.imf.org/external/data.htmhttp://www.imf.org/external/data.htm
  • 8/3/2019 Latin America Water Segment Webinar Presentation

    52/56

    Latin America vs BRIC: GDP PPP

    Country 2008 2009 2010 2011 2012 2015

    Brazil 10,526 10,499 11,289 11,805 12,355 14,429

    China 6,188 6,778 7,518 8,304 9,171 12,449

    India 2,868 3,015 3,291 3,563 3,847 4,914

    Mexico 14,546 13,609 14,266 14,856 15,649 18,106

    Russia 16,034 14,913 15,807 16,750 17,788 21,337

    GDP PPP usd

    Source: Elaborated with data of International Monetary Fund & WEO September(2011)

  • 8/3/2019 Latin America Water Segment Webinar Presentation

    53/56

    Asia vs Latin America: Imports

    Imports, US$bn

    2010 [4]

    China 1327.0

    India 357.7

    Indonesia 127.4

    Japan 639.1

    Korea (South) 422.4

    Malaysia 152.6Russia 248.7

    Taiwan 247.3

    Thailand 161.3

    Vietnam 80.0

    Imports, US$bn

    2010 [4]

    Brazil 181.7

    Mexico 301.5

    Argentina 53.9

    Colombia 38.6

    Venezuela 38.6

    Chile 55.2Peru 28.8

    Costa Rica 13.0

    Paraguay 9.8

    El Salvador 8.2

    Source: [4] Central Intelligence Agency, The World Factbook, December

    2011https://www.cia.gov/library/publications/the-world-factbook/(see annexes)

    https://www.cia.gov/library/publications/the-world-factbook/https://www.cia.gov/library/publications/the-world-factbook/https://www.cia.gov/library/publications/the-world-factbook/https://www.cia.gov/library/publications/the-world-factbook/https://www.cia.gov/library/publications/the-world-factbook/https://www.cia.gov/library/publications/the-world-factbook/
  • 8/3/2019 Latin America Water Segment Webinar Presentation

    54/56

    Asia vs Latin America: US exportsImports from USmn till

    november [3]

    2011f

    Brazil 39,554.6

    Mexico 181,231.6

    Argentina 8,958.8

    Colombia 13,101.7

    Venezuela 11,241.2

    Chile 14,323.1Peru 7,610.1

    Costa Rica 5,517.7

    Paraguay 1,821.8

    El Salvador 3,119.4

    Imports from USmn tillnovember [3]

    2011f

    China 94,172.0

    India 19,658.5

    Indonesia 6,700.4

    Japan 60,777.5

    Korea (South) 39,537.4

    Malaysia 13,115.5

    Russia 7,498.7

    Taiwan 23,617.7

    Thailand 10,165.3

    Vietnam 3,971.2

    Source: [3] US Census Bureau, Foreign Trade, September (2011)http://www.census.gov/foreign-trade(see annexes)

    http://www.census.gov/foreign-tradehttp://www.census.gov/foreign-tradehttp://www.census.gov/foreign-tradehttp://www.census.gov/foreign-trade
  • 8/3/2019 Latin America Water Segment Webinar Presentation

    55/56

    Mexico Socio-Economic Groups %

    Note: A/B salaries above $7,936; C+ salaries above $3,267; C salariesabove $1,083; D/E salaries above $ 634

    Source:Lopez, Heriberto, AMAI Congress (2011)http://www.amai.org/NSE/PRESENTACION_REGLA_8X7.pdf

    http://www.amai.org/NSE/PRESENTACION_REGLA_8X7.pdfhttp://www.amai.org/NSE/PRESENTACION_REGLA_8X7.pdf
  • 8/3/2019 Latin America Water Segment Webinar Presentation

    56/56

    Brazil Socio-Economic GroupsBRAZIL SOCIO ECONOMIC GROUPS

    Group/Level* % Population Population Salary in Real Salary in USD

    A1 1% 2,034,298 10,200 5529

    A2 4% 8,137,191 10,200 5529

    B1 9% 18,308,679 5,100 2764

    B2 15% 30,514,466 5,100 2764

    C1 21% 42,720,252 2,040 1105

    C2 22% 44,754,550 2,040 1105

    D 25% 50,857,443 1,020 552

    E 3% 6,102,893 1,020 552

    Source: ICEX / Comercio Importao (2010) & thebrazilbusiness.com