Regional Pulse: 11 January 2023

Southern Pulse’s weekly review of need-to-know events curated for people who do business in Latin America.

We help our clients operate successfully throughout the region with enhanced due diligence services, risk assessments, threat monitoring, strategic advisory and executive support. Get in touch here to learn how we can help you.



  • Government tables undeclared assets amnesty
  • Executive calls for removal of four Supreme Court justices


  • Far-right protesters storm presidential palace, Congress and the Supreme Court
  • Electric grid still vulnerable to hackers


  • Boric sacks top ministers amid protest amnesty backlash
  • Bilateral talks held with China to bolster investment


  • ELN guerrillas dismiss Petro’s truce claim
  • Exports increased by 42.7% in 2022


  • Exports to China grew by 77% in 2022
  • Oil production neared 12 year low in 2022


  • Government edges closer to military-run airline launch with Mexicana deal
  • Business confidence down across all sectors
  • Supreme Court picks AMLO energy policy critic as president


  • Oil royalties up 58% in 2022
  • Inflation in 2022 was the highest in 26 years



Dairy producers to get financial aid as FX woes mount

On 7 January 2023, Arturo Videla, an Agricultural Ministry official who oversees the dairy industry, told newspaper Ambito Financiero that the government will pay USD9.1 billion to subsidize dairy production for the next four months under the initiative “Impulso Tambero”. Videla also said that the government might cut taxes for the sector. The initiative will reach 79% of dairy producers nationwide. The complex regulatory environment and the depreciation of the local currency pose additional risks for the sector, which the government is trying to address with the measure.

Government tables undeclared assets amnesty

On 6 January 2023, the government sent a bill to Congress that would offer an amnesty for citizens’ undeclared assets. The proposal is an effort to increase government revenue and dollar reserves, and would offer a lower tax rate to participants with no questions asked about the assets’ origins. Those who join the initiative would have nine months to comply with the new law. However, the Chamber of Deputies opposition leader Juan Manuel López said the opposition would not give the government the votes needed as a protest for the government’s attempt to sack Supreme Court justices.

Executive calls for removal of four Supreme Court justices

On 4 January 2023, President Alberto Fernández called on lawmakers in the Chamber of Deputies to impeach four of the country’s five Supreme Court justices. President Fernández claims the justices were colluding with the opposition following media reports of incriminating text messages that were allegedly leaked. The next step is an ad hoc committee to judge the case. The government might pass the impeachment in the committee where it has a narrow majority, but the impeachment is unlikely to be approved by the lower chamber because the government lacks the necessary support.


Private investment grew in 2022

On 9 January 2023, newspaper Valor reported that the 10 largest companies listed on the São Paulo stock exchange spent 55.8% more on investments in 2022 than in 2021. The analysis excluded Petrobras (oil and gas) and Vale (mining) because their size would distort the figures. Local commodities companies are expected to profit from China’s reopening, but uncertainties over international macroeconomic scenarios and policies adopted by the new federal government might halt new investments in the first half of 2023, noted Valor.

Far-right protesters storm presidential palace, Congress and the Supreme Court

On 8 January 2023 thousands of supporters of former president Jair Bolsonaro stormed the presidential palace, Congress and Supreme Court in Brasília in scenes reminiscent of the 2021 US Capitol invasion. Social media footage showed some police officers talking with far-right protesters while public buildings were vandalized. President Luiz Inácio Lula da Silva blamed Bolsonaro for the attacks and decreed a federal takeover of security services in the capital. The Supreme Court temporarily suspended Brasília’s governor, a Bolsonaro ally. Approximately 900 protesters were detained at the time of publication.

Electric grid still vulnerable to hackers

On 6 January 2023, newspaper Valor reported that 743 electricity companies failed to comply with the cybersecurity measures established by the Energy Ministry last year, increasing their risk of being hacked and jeopardizing the country’s electric grid. State-run nuclear company Eletrobras Eletronuclear and Rio de Janeiro utilities provider Light were attacked by hackers during the 2020–2021 pandemic, prompting both to suspend their customer services.


State copper producer to decarbonize 70% of its energy supply

On 9 January 2023, the state-run copper producer Codelco announced an energy supply deal with power distributor AES Andes as part of its efforts to obtain 70% of its energy from renewable sources by 2026. The agreement commits AES Andes to supplying Codelco with 1.6 TWh of renewable energy per year from 2026 to 2040. Codelco has already implemented similar deals with utilities companies Colbún and Engie. Another front of Codelco’s decarbonization push is to incorporate more electric vehicles into its mining operations. Energy supply accounts for 65% of Codelco’s carbon footprint.

Boric sacks top ministers amid protest amnesty backlash

On 7 January 2023, President Gabriel Boric sacked Justice Minister Marcela Ríos and accepted the resignation of his chief of staff, Matías Meza-Lopehandía — two figures once considered to be among his closest allies. They were responsible for an amnesty of former protesters signed at the end of 2022 that prompted public outcry. Those pardoned for their actions during the 2019 protests included a person accused of attempted homicide and a former member of a Marxist guerrilla group. The new Justice Minister is Luis Cordero Vega. He will be in charge of curbing rising insecurity in urban areas and addressing the conflict between landowners and native Mapuches in the southern Patagonia region.

Bilateral talks held with China to bolster investments

On 6 January 2023, the governments of Chile and China held the fourth edition of their Strategic Dialogue on Cooperation and Economic Coordination, which focused on increased Chinese investment in lithium, copper, 5G technology, artificial intelligence, big data and infrastructure. The stock of Chinese investment in the country totals USD19 billion. In 2021, Chinese direct investment reached USD7.7 billion.


Ecopetrol seeks US permission to import Venezuelan gas

On 6 January 2023, state-owned oil company Ecopetrol sought permission from the US government to import Venezuelan gas. The latter is subjected to US economic sanctions which make any company trading with the Venezuelan state liable to prosecution in the US. However, in recent months there’s been some relaxation of the sanctions, with US oil company Chevron receiving a permit to import Venezuelan gas in November. Ecopetrol is looking to fulfill a contract signed in 2004 whereby Colombia agreed to supply gas to Venezuela between 2007 and 2015. In that year, the flow was due to be reversed, with Venezuela supplying gas until 2027. Relations between Colombia and Venezuela are thawing: both presidents met on 7 January to strengthen economic ties.

ELN guerrillas dismiss Petro’s truce claim

On 31 December 2022, President Gustavo Petro announced a six month truce with the ELN, but the guerilla group denied having reached any agreement three days later. Petro’s administration has since backtracked and resumed military operations against the ELN. In the coming weeks, both parties are still expected to return to the negotiation table in Mexico. Four other armed groups, the Segunda Marquetalia, Estado Mayor Central, Clan del Golfo and Autodefensas de Sierra Nevada, have agreed to the proposed six month truce.

Exports increased by 42.7% in 2022

On 30 December 2022, data published by the National Department of Statistics (DANE) covering January to November 2022 indicated the combined value of exports increased by 42.7% from the previous year. According to the data, exported goods and services totalled USD52.6 billion. The main export sector was extractives, representing 33% of the total — up 69% from the previous year. The country’s principal trade partner is the US, which purchased 25% of total exports.


Work continues on constitutional reform to expand the army’s remit

On 4 January 2023, the legal secretary of the presidency met with legislators to work on a constitutional reform that would allow the military to participate in domestic security operations against organized crime. The reform was first challenged by the Constitutional Court, which ruled that the proposal must be debated and approved by the National Assembly. Work has now begun on creating a draft that will be submitted to the presidency of the Assembly on or around 14 February.

Exports to China grew by 77% in 2022

On 3 January 2023, data from the Ecuadorian Exporters Federation (FEDEXPOR) showed non-oil exports to China grew by 77% in 2022. The total value of non-oil exports slightly exceeded USD10 billion, with shrimp being the main product (USD3.4 billion). The data was made public shortly after the Ecuadorian and Chinese governments signed a trade treaty to reduce tariffs. According to FEDEXPOR, before the agreement, only 40% of Ecuadorian exports were covered by trade agreements, compared with around 90% in neighboring countries, such as Colombia, Mexico or Peru.

Oil production neared 12 year low in 2022

On 26 December 2022, Central Bank data revealed oil production in 2022 was the second lowest since 2010. Average daily oil production stood at 479,156 barrels, slightly higher than in 2021, but worse than any other year since 2010. The shortfall comes after President Guillermo Lasso vowed to double average daily oil production to a million barrels. However, infrastructure setbacks such as damaged pipelines and electrical issues, as well as widespread civil unrest, have contributed to stagnating production that is yet to recover pre-pandemic levels.


Sinaloa Cartel boss captured

On 6 January 2023, security forces captured Sinaloa Cartel boss Ovidio Guzmán in Culiacán, Sinaloa state. His arrest prompted hours of shootouts and road blockades that resulted in 29 deaths and 21 arrests. According to Defense Minister Luis Cresencio Sandoval, there were no reported civilian deaths. President Andrés Manuel López Obrador said that there were no immediate plans to extradite Guzmán to the US, where his father Joaquín Guzmán, aka El Chapo, is in a maximum-security prison for previously heading the Sinaloa Cartel.

Government edges closer to military-run airline launch with Mexicana deal

On 6 January 2023, the government signed a deal with several aviation unions to purchase the brand rights associated with the defunct national airliner Mexicana de Aviación for USD42.41 million as part of President Andrés Manuel López Obrador’s plans to launch a military-run commercial airline later this year. The deal also includes two buildings, a technical training center and a flight simulator. Mexicana ceased to operate in 2012 after announcing bankruptcy proceedings in 2010.

Business confidence down across all sectors

On 3 January 2023, the National Institute of Statistics and Geography (INEGI) published the latest figures on business confidence, revealing a 10.7% year-on-year decrease across all economic sectors, with the sharpest decline in non-financial services (transport, communication, and intangible services). According to the report, only 45% of businesses have confidence in the country’s economic outlook. Factors behind the pessimism include the possibility of a US recession, high inflation, rising interest rates, and policy uncertainty for some sectors.

Supreme Court picks AMLO energy policy critic as president

On 2 January 2023, the Supreme Court elected Justice Norma Piña as its first female president in a move that may curb President Andrés Manuel López Obrador’s oil and gas-centric energy agenda. Piña has previously pushed back against the current government’s energy policies, while defending a transition to renewables (rather than increased fossil fuel production). She replaces Arturo Zaldivar as chief justice, and will serve in the post until 2026.


Nineteen lawmakers under investigation for corruption

On 6 January 2023, the National Prosecutor’s Office announced that 19 legislators from Acción Popular (AP), Perú Libre (PL), and Bloque Magisterial were now part of its ongoing investigation into former president Pedro Castillo. Among those under investigation are two former cabinet members: production minister Jorge Prado and labor minister Betssy Chávez. According to a protected witness, these legislators traded their votes for beneficial placements within state organizations for themselves and their allies.

Oil royalties up 58% in 2022

On 4 January 2023, data from the National Mining, Oil and Energy Society (SNMPE) found oil companies paid over USD1 billion to the state in royalties. This represents a sharp increase from 2021, of 58%. The rise follows higher oil prices in 2022.

Inflation in 2022 was the highest in 26 years

On 1 January 2023, the National Statistics Institute (INE) revealed that the consumer price index rose by 8.56% in 2022, its highest level since 1996. The rise was mainly due to higher food and energy prices. Inflation, however, has been slowly decelerating since June of 2022.

Wherever you do business in Latin America, Southern Pulse has the expertise, the network, and the relationships to help solve your toughest operational challenges. Want to learn more? Let’s chat.




Southern Pulse provides strategic advisory services to help businesses operate successfully in Latin America.

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Southern Pulse

Southern Pulse provides strategic advisory services to help businesses operate successfully in Latin America.