Page 39: of Maritime Logistics Professional Magazine (Q1 2011)
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South American stalwart beckons with a robust economy, stable political system and a pro-business climate. What’s not to like? by Claudio Paschoa
For oil & gas firms and the maritime industry that supports those sectors,
South America today presents the enig- ma of promising new frontiers but also the specter of risk involving invest- ments to regions that can and do exhib- it political and economic instability.
Clinging to Bolivarian and Marxist tra- ditions which stress confrontation with and mistrust of U.S.-style democratic governments, certain high profile states still insist that international investment is a cover for imperialistic takeover of their countries. Not so in Brazil.
TOO MUCH RISK OR
In terms of uncertain business climate alone, Venezuela is perhaps the poster child for bad behavior in the region. The fifth largest oil exporting country in the world – also boasting the largest proven reserves of light and heavy crude oils in the western hemisphere and the largest reserves of very heavy crude stocks on the planet – has, over the course of the past two years, nationalized dozens of oil-service companies. Many of those are still awaiting promised compensa- tion and perhaps more significantly, at least two oil giants are mired in arbitra- tion over government changes to their operational contracts in the Orinoco