5G Networks in Latin America

5G standalone networks will expand in Latin America this year, leveraged by the spectrum tenders in Chile, the Dominican Republic and Brazil.

As of December, eighteen 5G networks were operating in Latin America, according to 5G Americas, but many are non-standalone networks with dynamic spectrum sharing (DSS) technology.

The first commercial 5G networks in Latin America and the Caribbean were those of Claro Puerto Rico, Liberty (formerly AT&T), and T-Mobile in the Virgin Islands. But before that, Antel Uruguay had activated the first 5G base stations in Montevideo.

While last year many autonomous 5G networks (with own core and spectrum) were launched, investments in increasing general coverage will continue this year.

However, operators association GSMA estimated 5G investments will peak around 2025. GSMA said mobile operators invested US$11.3bn in the region during 2020, which will rise to US$13bn in 2025. Overall investments between 2020 and 2025 are expected to reach US$73bn. (Bnamericas)

Source: Omdia, 5GAmericas

Peru Seen Lifting Key Rate for a Sixth Month

Peru is forecast to raise interest rates for a sixth straight month on Thursday as inflation surges amid one of the world’s strongest recoveries from the pandemic.

The central bank will increase its policy rate by half a percentage point to 3% according to five of seven analysts surveyed by Bloomberg. Two economists expect a bigger increase, to 3.25%.

Policy makers in Brazil, Mexico, Colombia and Chile have also been withdrawing stimulus as inflation accelerates above target across all the region’s major economies. As economies eased controls intended to curb the pandemic, pent-up demand pushed prices higher, aggravated by rising global food and energy costs.

In Peru, annual inflation accelerated to a 13-year high of 6.4% in December, led by food and energy costs. The central bank targets inflation of 2%, plus or minus one percentage point.

The economy grew 12.6% last year, the fastest pace in Latin America, according to estimates by economists surveyed by Bloomberg, despite political volatility and a contested election.

In December, conservative opposition lawmakers tried to start impeachment proceedings against President Pedro Castillo, but failed to get enough votes in congress. (Bloomberg)

Source: Banco Central de Reserva del Peru; Instituto Nacional de Estadística e Informática de Peru Note: January 2022 key rate = median estimate.

Nearly Half of Latin Companies Set to Adopt AI by 2023

Artificial intelligence (AI) will be in place in 40% of the largest organizations in Latin America by 2023, according to research released by IT analyst firm IDC.

Companies in the region will also be seeking governance services relating to areas such as data management and security, according to the study that was carried out with 5,000 large Latin American businesses.

Despite the advances in AI adoption in the region, the analyst noted that 30% of companies will not be able to make the most of the technology due to skills shortages and challenges in relation to the existing IT set up of organizations.

To tackle these challenges, IDC is advising companies to focus on building the expertise for technical implementations and in complex contract negotiation required to make inroads in AI, while also addressing areas such as automation. IDC predicted that 40% of Latin organizations will have digital sustainability teams in place next year.

The way Latin organizations manage their IT budgets is also set to change, the IDC report noted, as businesses implement service-based technologies in areas ranging from cloud to virtual working spaces and connectivity. Some 40% of companies will also be allocating hardware budgets differently to improve the experience of customers and staff working remotely until 2025.

Most companies using artificial intelligence systems in Latin America have profited from the use of the technology, according to research from Boston Consulting Group (BCG) and MIT Sloan Management Review (SMR). However, the numbers in Latin America are below the global average: 55% of AI enterprise users polled worldwide registered profit through the use of the technology with 11% generating a high profit. (ZDNet)

Brazil Elections 2022: The Candidates

Brazilians will head to the polls later in the year to elect a president, 513 federal deputies, a third of the senate, and all state governors and assembly members. Voting is scheduled for October 2, and a run-off date is set for October 30 in case no candidate – for governor or president – receives more than 50% of valid votes.

Below we present the candidates for these 2022 elections:

How he got here: Bolsonaro’s 2018 election victory heralded a new alliance between social conservatives and pro-business forces, and a rejection of the status quo politics that led Brazil into its worst economic crisis on record. However, his government struggled to boost investment and economic growth even before the pandemic, which devastated Brazil amid Bolsonaro’s frequent denialism of the virus’s severity and the efficacy of vaccines.

Why he might win: Bolsonaro retains solid support among his conservative base, about 25% of the Brazilian electorate. His supporters bet that will be enough to get him into a runoff against Lula, where a recent increase in welfare programs could help him win enough working-class votes to eke out a victory.

Why he might lose: Bolsonaro’s poor handling of the pandemic, and his constant fights with institutions including Congress and the Supreme Court, have left many Brazilians fatigued and eager for change. Clear majorities say in polls they no longer trust their president or see him as competent to lead.

Who supports him: Social conservatives including Brazil’s growing evangelical Christian community and the rank-and-file of the military and state police. Small business owners and the agricultural sector, which has thrived in recent years.

How he got here: Lula’s biography reads like an epic novel. A longtime metalworkers’ union leader, he was elected president on his fourth try and oversaw a long economic boom from 2003-10. He was then jailed for nearly two years on corruption charges, which were thrown out by the Supreme Court in 2021, allowing him to run again.

Why he might win: Positive memories of Lula’s presidency, which saw millions of Brazilians rise out of poverty and also a 500% increase in the stock market, seem more enticing to many voters after the disorder of the Bolsonaro years. 

Why he might lose: The Lula years also had their dark side, including numerous corruption scandals and economic distortions that blew up under his chosen successor Dilma Rousseff, resulting in the worst recession in Brazil’s history from 2014–16. Lula’s opponents will try to appeal to antipetismo (sentiment against his Workers’ Party) as the election heats up.

Who supports him: Lula’s support is strongest among Brazil’s poor and lower-middle classes, especially in the northeast.

How he got here: A well-traveled politician who served as a governor and a minister in multiple governments including Lula’s, this is Gomes’ fourth presidential campaign, following a third-place finish with 12% of the vote in 2018. These days, he casts himself as a leftist alternative to Lula while also flirting with parts of the center-right.

Why he might win: Gomes seems like a longshot, but could prevail if something unexpected happens to derail Lula’s candidacy.

Why he might lose: Lula is simply not leaving enough oxygen for other left-of-center candidates. Gomes is also mistrusted by many across the ideological spectrum in Brazil’s political class because of his long career of bitter public clashes. Many leaders in his own party could pressure him not to run, to allow their lower house and state assembly candidates to campaign with Lula instead.

Who supports him: Well-educated voters and others from the urban middle class, who lean left but reject the corruption and other decay under the Workers’ Party’s 14-year rule. His power base is in his longtime home of Ceará state, and other parts of the northeast.

How he got here: A previously obscure federal judge, Moro won international renown in the mid-2010s for overseeing the sprawling Lava Jato (“Car Wash”) corruption case, which sent many powerful figures to jail, including Lula. Moro then served as Bolsonaro’s justice minister but resigned, alleging the president’s attempts to interfere in the Federal Police. In 2021, Brazil’s Supreme Court ruled Moro was not impartial as a judge in the Lula case, further tarnishing his image.

Why he might win: Many Brazilians still see Moro as an anti-corruption hero capable of purging the current political class. His path is to steal away enough of Bolsonaro’s supporters to pass him and enter a second round against Lula, where he could then rally broad support from conservatives, centrists and business leaders.

Why he might lose: Despised in roughly equal measure by the left (for jailing Lula) and right (for “betraying” Bolsonaro), Moro has the highest negative ratings of any major candidate except Bolsonaro. Polls suggest there is not much demand for a so-called “third way” candidate.

Who supports him: Business leaders, some influential media commentators, law enforcement figures, and more centrist voters turned off by Bolsonaro’s response to COVID.


Mexico's Central Bank to Launch Digital Currency by 2024

Mexico’s central bank will have its digital currency by 2024, the Mexican government announced on social media, although the development was not confirmed by the monetary authority, known locally as Banxico. “Banxico reports that it will have its own digital currency in circulation by 2024,” the Mexican government wrote late on Wednesday on its official Twitter account.

The post said the central bank “considers that these new technologies and the latest payment infrastructure are very important as valuable options to advance financial inclusion in the country.”

But a senior central bank source, who requested anonymity, told the Reuters news agency on Thursday that the government announcement was “not official.”

Mexico’s central bank is legally independent of the government.

Neither Banxico nor the Mexican government immediately replied to Reuters requests for comment.

In a report published on December 17, Banxico said, “It is working on the study and development of a platform aimed at the implementation of a digital currency,” but it gave no details on timing.

Source: Contxto based on Statista data

“The project has among its objectives the opening of accounts for the registration of a digital currency for both banked and unbanked people, thereby contributing to financial inclusion,” the report added.

Several central banks worldwide are exploring the launch of digital currencies, concerned that cryptocurrencies like bitcoin could weaken government control of monetary policy. (Aljazeera)

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