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EMTA Forum in Miami - Jan. 16

Tuesday, January 16, 2018  

InterContinental Hotel
100 Chopin Plaza
Miami, FL

2:45 p.m. Registration 

3:00 p.m. Keynote Address
Ruth de Krivoy
GlobalSource Partners and former President, Central Bank of Venezuela

3:45 p.m. Panel Discussion
Prospects for the Emerging Markets
Alberto Bernal (XP Securities) – Moderator
Daniel Canel (AdCap)
Kathryn Rooney Vera (Bulltick Capital Markets)
Ajata Mediratta (Greylock Capital Management)
Jeff Norton (Mizuho Securities USA LLC)

5:00 p.m. Cocktail Reception
Sponsored by  

Additional Support Provided by AdCap, Mizuho Securities USA LLC and XP Securities.


We regret that this event is no open to members of the press. 

Attendance is complimentary for EMTA Members / US$695 for Non-members. 


Former Venezuelan Central Bank President De Krivoy Delivers Keynote at EMTA Miami Forum

Former Central Bank President, and Global Source analyst, Ruth De Krivoy discussed the outlook for Venezuela at EMTA’s Annual Forum in Miami held on Tuesday January 16, 2018. The sold-out event attracted 80 EM investors and was sponsored by MarketAxess, with additional support provided by AdCap, Mizuho Securities and XP Securities.

In her keynote remarks, De Krivoy provided an overview of the current state of Venezuelan politics. Among the many topics in her speech, she addressed the goals of both the government and opposition parties in their talks in the Dominican Republic; current possible paths for the current regime, and potential future leaders of the country; the effects of hyperinflation; the outlook for oil production; and government plans for a crypto currency. De Krivoy also entertained a long list of questions for Forum participants.

Following De Krivoy’s remarks, Alberto Bernal (XP Securities) led a panel discussion, starting with the global economic outlook. Kathryn Rooney Vera (Bulltick Capital) declared that the lowering of US taxes was a “game changer,” which would boost the world economy. She predicted two US rate hikes at a minimum, shrugged off concerns about US inflation, and forecast the US 10-year Treasury rate to be at 2.75% at year-end.

Bernal directed the panel through the major Latin economies. The Brazilian appeal’s court ruling on former President Lula’s conviction would prove critical, argued Jeff Norton of Mizuho Securities. He accurately predicted that the appeal would be rejected, with the market hoping for a decisive indication of Lula’s eligibility in the next presidential election. Norton added that meaningful social security reform was off the table under the current administration, but that fiscal reform would need to be a top priority for the next government.

Investors also sought political clarity in Mexico, he reasoned. Norton’s base case was that AMLO would win the Mexican elections, as a result of the plurality format. “The anti-AMLO forces are fractured and running independently, which serves to increase AMLO’s odds,” he stated, and former Finance Minister Meade faces the significant hurdle of low name recognition. Rooney Vera argued that economists may be overlooking AMLO’s fiscal conservatism, while acknowledging that his election could pose political risks due to his lack of interest in consensus-building. Norton and Rooney Vera concurred that risks of a US unilateral withdrawal from NAFTA would be heightened if AMLO were elected.

Daniel Canel (AdCap, and former EMTA Board Co-Chair) reviewed Argentine economic progress. The government had adjusted its emphasis away from combatting inflation in favor of promoting growth, and would also allow peso weakening. President Macri had gained political capital in the recent mid-term elections, and should remain steady on his agenda of pension reforms, labor market reforms, subsidy reductions and wage negotiations with the unions. Canel warned that Buenos Aires should move carefully to reform the public sector, in order to avoid large public protests. Progress would lead to further credit upgrades, although Canel speculated that GDP warrants would remain out-of-the-money for the foreseeable future, thus avoiding legal wrangling.

Turning to Venezuela, Ajata Mediratta (Greylock Capital Management) affirmed that, during his many years in the EM industry, Venezuela stood out as “one of possibly only two countries with such abundance of natural resources that has single-mindedly run itself into the ground.” He noted that bondholders were organizing, and stressed that the importance of ultimately forming a single creditor committee, which at least initially should be composed of both PDVSA and sovereign debtholders. Among bondholders’ immediate goals was clarification on whether payments were stuck in payment systems.

“Bondholders would offer some relief,” he opined, when discussing a potential solution to the current default, although he questioned whether bondholders could achieve a resolution with the current government as “relief is usually accompanied by a credible commitment to sensible reforms.” Ultimately, “all roads lead back to negotiation, because the government will need access to significant capital,” he stated.

The panel concluded with major risks to the asset class. Rooney Vera cited geopolitical risk (“The Mutually-Assured Destruction theory doesn’t work with North Korea”), as well as inflation and policy risk (including US moves towards protectionism). Norton listed an over-aggressive FOMC, as well as political violence in the Mexican election cycle. Canel added cyber-attacks in the US or Europe. Finally moderator Bernal expressed fear of a US trade war with China.