The pain in Spain.

Author:Manaut, Sergio
Position:INVESTMENTS: NATIONALIZATIONS
 
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YPE Red Electrica, Sabsa--companies backed by Spanish capital--were expropriated in the past year in Latin America. Is a new wave of nationalism being aimed at Spain?

Some sectors of Madrid's business community have been muttering with varying degrees of concern about the notion of harassment of Spain's investments in Latin America.

On February 18, the president of Bolivia, Evo Morales, set off alarm bells. Morales announced that he would expropriate Servicios de Aeropuertos Bolivianos, known as Sabsa, a subsidiary owned by Spain's Abertis y Aena, which administers the country's three largest airports.

Under his watch, Morales has overseen about 20 nationalizations since 2006, when he decreed the expropriation of the hydrocarbons industry and concluded the gradual renationalizing of the subsidiaries of Yacimientos Petroliferos Fiscales Bolivianos (Ypfb).

The story of the government's relationship with Spanish investments continued on May 1, 2012, when Morales nationalized Transportadora de Electricidad (TDE), a subsidiary of Red Electrica Espanola (REE). Then on December 29, he decreed the expropriation of two distributors of electricity in La Paz and Oruro, subsidaries of another Spanish companny. Iberdrola. The decree also takes in a service company and an investment management firm. All the nationalizations were said to be based on a failure to comply with investment plans.

But, the nationalizations by the president of Bolivia were surpassed in severity by those of the Kirchners in Argentina. In addition to nationalizing Aerolineas Argentinas from Marsans--now bankrupt, with its owner living in a Madrid prison--Argentina took over pension funds that included Bbva's Consolidar. A year later, it surprised the world with the expropriation of Repsol's 51 percent stake in the Argentine state oil company YPF, setting off a deep rift between Spain and Argentina.

Repsol is accusing YPF in a case held before the World Bank's International Center for Settlement of Investment Disputes (Icsid). Informed sources within Repsol told Latin Trade the indemnity Argentina would have to pay could be in the range of $10.5 billion, "without counting the cost in terms of prestige that will impede its search for an investment partner for the Vaca Muerta shale project."

Venezuela has also climbed onto the nationalization bandwagon. In July 2008, the late President Hugo Chavez announced a takeover of Banco de Venezuela, an affiliate of...

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