NEW YORK (PRWEB) July 8, 2008
NEW YORK (Business Wire EON) July 8, 2008 -- With market uncertainty in the U.S. and elsewhere and the depressed dollar prompting institutional and high-net worth investors to seek alternatives, Colombia should be on the list of markets to consider seriously, according to Alex Silberwasser and Felipe Gomez of Compass Group, an independent investment advisor focused on Latin America.
"There are two important stories coming out of Colombia that are meaningful to investors. The first is political. There has been a dramatic turnaround in the security situation, and the trend of stability and safety is solid. This means greater confidence and, more importantly, access to resources that had been out of reach. Further, the current, pro-market, economically savvy government appears to be firmly rooted. The second story is economic. Growth is significant, the private sector is well-managed, and investing is picking up dramatically, breathing new life into the equity market," said Mr. Silberwasser, who is a partner at Compass Group and the manger of Compass Group Colombia.
Mr. Silberwasser and Mr. Gomez at Compass Colombia are available to share their perspectives on how investors should view and approach Colombia – both the opportunities and downsides. During a conversation, they can address:
Growth. Colombia's GDP growth in 2007 was 7.5%, well above the average in Latin America. There has only been one recession year – 1999 – in the last 70. Since 1999, growth has averaged between 4% and 5% a year. The dramatic increase in national security. Natural resources and towns are now fully accessible, creating multiple opportunities and opening new markets. Commodities growth. Not only has exploration of one of the world's largest gold mines started, but, also, the reserves of unexplored oil are estimated to be four times the explored reserves. In addition, Colombia's Ecopetrol, which will list on the NYSE in 2008, has a budget of $60 billion to invest in oil development. Investment climate. Colombians are stepping up investment in Colombian equities (and making handsome returns); the Ecopetrol ADR listing will put fresh cash into the market; pension funds are doubling in size every three to six years (with most pension fund contributors being age 25 or younger); the stock exchange may soon allow short selling and open the door for the derivative market; and the government is formulating laws to diversify pension fund risks. Industry. Significant growth is occurring not only in the energy industry, but also in the agriculture, technology, infrastructure and manufactured products sectors. Many companies in this diversified economy are expanding internationally. Colombia versus other developing economies, including those in Latin America. International mutual fund investment in Colombia has been low, so the market wouldn't be as affected by shifts in investor sentiment around the world: the market is less crowded with foreign investors than China and India. Further, Colombia's equity market has beat those of Asia in recent years. Compared with other Latin American economies, Colombia's is more diversified. In addition, Colombia is less "explored" than neighboring countries in terms of natural resources and is on a more positive trajectory in terms of market reforms. Concerns. There is still relatively low liquidity. Plus, there are risks relating to neighboring countries, particularly Venezuela. To arrange a conversation with Mr. Silberwasser or Mr. Gomez, please contact Adria Greenberg at Sommerfield Communications, Inc. at 212-255-8386 or [email protected]
Compass Group, LLC, founded in New York in 1995, is a leading Latin American independent investment advisor that serves institutional and private clients. Compass has affiliate companies that manage $8.2 billion and have over 250 employees. Compass companies have offices in New York, Miami, Mexico, Peru, Chile, Argentina and Colombia. Offerings include open- and closed-end mutual funds, managed accounts and personalized investment portfolios. The firm and its affiliate companies maintain in-country research teams and also perform top-down analysis. Compass seeks opportunities in all asset classes.