E-NEWS UPDATE VOLUME 19 NUMBER 1026

THE IMF: LATIN AMERICA HAS RECOVERED FROM THE CRISIS

The IMF announced this week that the worst of the world financial crisis is now behind most of the countries in the region. Brazil, Chile, Colombia, Peru, Argentina and Venezuela are leading the recovery in the region. The world's International Monetary Fund (IMF) stated that the US economy - which is still weak - will affect the recovery in some countries in Latin America. But it also stated that the countries which implemented economic stimulus and financial conservation measures will have to be careful about handling these measures as they move forward. It has also forecast that the region will record a 2.5% growth in 2009 and 2.9% in 2010. However, it is forecasting an average growth of 3.5% in the countries with the best economies, namely Brazil, Chile, Colombia, Peru, Argentina and Venezuela. Countries to watch.

GERMAN EFROMOVICH ON A SHOPPING SPREE

The owner of Synergy Group who has successfully put together the most important airline joint venture by creating a holding company which controls Avianca and TACA, is still looking for additional investment opportunities. Last week he apparently has acquired 80% of Ecuador's AeroGal (Aerolineas Galapagos) as part of his plan to compete with the other major Latin American airlines. The plan for the Ecuadorean subsidiary is to provide it with three A319 and A320 aircraft as well as a B767-300 in order to increase its once-weekly flight to Miami. According to sources in Colombia he is also looking at Colombia's Aires, which recently received authority to serve the US and Brazil and also has his eye on GOL. He has also stated his interest in acquiring the 27% share in LAN that is owned by Sebastian Pinera, a presidential candidate who will sell his stake in the Chilean airline if elected. However, he admits that he has not had discussions with either Pinera or the Cueto's who control the Chilean "model airline' and probably have first rights to acquire the stock if it becomes available. Regardless, he is obviously fascinated with building a major presence in Latin America.

THE E-FUEL MANAGER BY LARRY S. WEAVER

Crude prices eased some on Friday dropping back below $80 per bbl as poor economic data from the US tempered the thoughts of economic recovery. In addition, comments from OPEC that they may consider increasing production at their December meeting added downward pressure on crude. With OPEC publicly putting out the information that an increase in export quotas is being considered, we can expect the more opportunistic members of OPEC to start/continue increasing their exports immediately to take advantage of the current higher prices. By the time of the December meeting, any increase will be simply a ratification of the increases already in place.

With winter weather coming upon the Northern Hemisphere, however, we do not expect prices to plummet, or to ease much at all. Indications are that with the coming cooler winter weather increasing the demand for heating oil; the improving economy and the weaker US Dollar, prices are not going to fall for the next several months and will likely hold close to the current levels - if not higher - regardless of what OPEC does at their December meeting.

Other news, briefly

Lufthansa begins daily nonstops between Frankfurt and Buenos Aires

The German "European Leader Airline" added twice weekly flights between Frankfurt and Buenos Aires on Sunday October 15, bringing its service to daily with 40% additional capacity in the market. Way to go.

Brazil is anticipating FDI of $1.7 billion in October

Brazil's Central Bank said on Friday that it expects Foreign Direct Investment (FDI) to reach $1.7 billion this month, just below the $1.8 billion received in September. The bank added that foreign investments in shares and fixed rentals reached $6.8 billion through September. Viva Brasil, with an "S"

TAM Airlines in Paraguay launches new route to La Paz, Bolivia

The Paraguayan based airline has announced it will launch a new route between Asuncion and La Paz in Bolivia with four-weekly flights on December 1. The service will be operated with A320 aircraft and will offer connecting services from Buenos Aires and Sao Paulo. Stay tuned.

Pluna has begun domestic service in Chile

Uruguay's "born again" airline has begun domestic passenger and cargo flights in the domestic market in Chile. Last week it launched its first overnight flight in alliance with Sky Cargo between Santiago and Punta Arenas carrying packages and newspapers. This is the beginning of the system called "Seat Containers" with its Bombardier CRJ900 aircraft using overnight layover aircraft.  Way to go Matias and company.

Pablo Chiozza appointed commercial director of LAN Argentina

After more than eight years with the Chilean 'model airline", Pablo Chiozza has been appointed commercial director of LAN Argentina. He was most recently commercial manager for the Chilean airline in Madrid, Spain. He replaces Felix Antelo who is moving to Santiago as International Sales Manager. Congratulations.

ASUR to double capacity of the Cancun Airport

The operator of nine airports in southeastern Mexico has announced it will open a second runway which will allow it to handle 28 million passengers annually. The building of the second runway and a second control tower required an investment of $67 million. Stay tuned.

Brazilian tourists in Peru grow 36.45% in the first half of the year

Peru received 39,536 Brazilian visitors in the first six months of 2009 for a growth of 36.45% over the same period last year. According to Promperu, the Peruvian tourism promotion government agency, Brazil is the number one tourism originating market for the country. Way to go.