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May 28, 2008

SINGAPORE/COMPANIES
Temasek eyes investments in Latin America

Singapore’s state investor Temasek on Wednesday announced plans to boost its presence in Brazil and Mexico to tap growth in Latin America's powerful emerging economies, Reuters reported.

The move underscores the state investment firm's recent focus outside its core Asian market, which excluding Japan accounted for 78 percent of its S$164 billion portfolio ($120.5 billion) last year.

Temasek, headed by Ho Ching, the wife of Singapore Prime Minister Lee Hsien Loong, also made high profile investments in Western banks such as Merrill Lynch and Barclays in 2007.

The Singapore firm said that it has hired Lorenzo Gonzalez Bosco, former chief executive of Barclays Bank in Mexico, as its new managing director for investment in that country and will relocate Alan Thompson, its managing director for investment in Latin America, to Sao Paulo, Brazil later this year.

"We believe the Latin American region holds long-term potential and offers attractive investment prospects," the statement quoted its Chief Investment Officer Tow Heng Tan as saying. "We will look seriously at opportunities that may arise, but we also do not seek to target any specific investment amount of capital within any given timeframe."

With a combined gross domestic product of US$3.3 trillion and economic growth of 5.2 percent last year, Latin America is home to some of the world's strongest economies, the statement said.

Brazil and Mexico, the two largest economies in this region, accounted for 70 percent of the region's GDP.

Temasek is eyeing Latin America at a time when the region's economies face a potential slowdown due to its proximity to the United States.

World Bank's vice president for Latin America, Pamela Cox, said earlier this month that growth for the region this year should be "more or less" 4.5 percent. Her last estimate of 4.8 percent was given to Reuters in April and was lower than a previous forecast of 5.1 percent.


She said the economic slowdown in the United States threatens to hit Mexico and Central America hardest because of their integration with the US market.

Temasek is taking a leap outside Asia following recent political and regulatory obstacles for its investments in Asia in countries such as Thailand and Indonesia.

Earlier this month an Indonesian court ordered Temasek and its affiliates to sell one of its two Indonesian telecoms units, upholding an earlier ruling by the country's anti-trust body.



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