Blended Finance Makes More Low-Carbon Investments Possible
The Financial Planners are Turning to Alternative Investments and Life Insurance is on their List
The Calm Before the Storm, Gold Bullion Will Benefit
Foreign investment in Brazil up despite global gloom
Brazil Component Imports, Investment Benefit From Strong Real-Santander
EU bids to rescue carbon trading scheme
FRA agrees that Brazil Regulations could boost Agricultural investment
Euro Crisis Damps East Europe Growth, Development Bank Says
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Welcome to the August edition of the Greenwood Management monthly newsletter.
Our aim is to send out a newsletter on a monthly basis to advise you of future events and report on previous industry related themes and news articles.
In Brazil, much of our focus this time of year is on land and infrastructure preparation for the oncoming planting season. So, apart from the daily maintenance which is always in progress, we are constructing internal roads within the plantations, firebreaks, laying down irrigation lines, analysing soil samples, preparing the nursery areas for 100s of thousands of incoming seedlings of acacia and eucalyptus (and also 2 versions of Mahogany, namely Brazilian Mahogany and African Mahogany).
All fertilisers are purchased in advance, together with hundreds of tonnes of limestone. At the same time our licensing applications are being submitted, which involves topographical surveys and a lot of paperwork! So we are keeping busy.
We have included below some investment articles that may be of interest. Enjoy reading and look out for announcements on our new project.
If you have any suggestions for future newsletters please click here to provide your suggestions and we will do our best to meet your requests.
IFC helped structure more than $131 million in approved concessional funds in FY12 to be used alongside $630 million in IFC co-financing for climate change investments. The investments totaled $3 billion.
"Blending concessional funds alongside IFC's own allows us to increase our reach and achieve more development impact than would otherwise be possible," said Nena Stoiljkovic, Vice President, Business Advisory Services. "IFC has a strong track record for doing this in the area of climate change, and we're excited to be expanding the approach in FY13 into other strategic areas of food security and SME finance."
The concessional funds from donor partners went toward 13 investments ranging from projects with banks to develop sustainable energy finance portfolios to constructing solar plants to developing biomass as a renewable energy source, several of which are located in IDA countries such as Kenya and Honduras. The approved concessional funds, triple the previous year's amount, were leveraged more than 21 times.
In FY13, IFC will continue to make investments in higher-risk climate-related projects as well as provide support to new facilities such as the Global SME Facility and the Global Agriculture and Food Security Program, which deploy concessional funds for SME financing and food security and agribusiness, respectively.
To read the full story click here.
We've been hammering the alternative investments point pretty hard lately, and this is because the financial services industry is abuzz about what to do with its tarnished image for cuddling up with the main stream stock market for so long and and now being accountable for it's general lack of reliability to the average investor.
So, what are money managers and general financial planners (the certified kind) doing to restore faith and peace of mind among their clientèle? The answer is quite interesting.
The Shift To Alternatives
Curian Capital performed a recent survey among its investment advisors to see what their game plan is moving forward given the stock market decline and lack of a booming recovery. The survey also collected data on how these advisors viewed the economy, and what they saw as the biggest current threats to the economy and its recovery.
Late last week when reading the World Gold Council's Gold Investment Statistic's commentary, we were reminded of when Doug Casey said '"inevitable" is not the same thing as "imminent."'
As we keep mentioning on these pages the financial situation, which has been snowballing for over 40 years, will continue to do so and in the process those who decided to invest in gold bullion will benefit.
However, since the beginning of the year, action in the gold price has been victim to much criticism as it seems that despite the negative headlines in regard to the state of the world economic situation, gold has not been acting its part.
The WGC's report addresses some of the key arguments against gold and reminds us that in the long term, gold does what it is supposed to do – hold its value and has zero counter-party risk. But we must be patient and watch as the farce continues to be acted out for us by the central banks, safe in the knowledge that whilst the rush to gold is inevitable, it is by no means imminent.
Foreign investment in Brazil up despite global gloom
BRASILIA, July 24 (Reuters) - A rebound in Brazil's foreign direct investment in June fully covered a widening current account deficit, central bank data showed on Tuesday, underscoring the resilience of foreign investment even as the international and local economy slow sharply.
Brazil posted a current account deficit of $4.419 billion in June, slightly above market analysts median forecast of $4.8 billion. The figure also surpassed the $3.47 billion gap posted in May.
The current account is a broad measure of a country's foreign transactions, including trade in goods and services, interest payments, and profits and worker remittances.
The June current account deficit was covered by incoming investments from abroad. Foreign direct investment, after slowing in recent months, rose to $5.822 billion in June from $3.716 billion in May, the central bank said.
If history is a guide, Brazil's deliberate weakening of its currency, the Brazilian real, might not add support to the country's faltering economy, according to the chief economist of Banco Santander Brasil (SANB11.BR).
"Over the last 20 years, Brazil's economy has always grown faster when the real was stronger, not weaker," Mauricio Molan, chief economist of the Brazilian unit of Spain's Banco Santander (SAN.MC), said in an interview with Dow Jones Newswires.
"I am not saying that a strong currency necessarily leads to better economic performance," he added. "It's because, when the economy is doing well, the currency tends to strengthen. It's also true that, whenever the currency is strong, imports grow faster than before and so do investments."
He said there was "such a correlation at the beginning of the Real [Stabilization] Plan in 1994 and again between 2004 and 2007." Brazil's gross domestic product grew at an annual rate of more than 5% in 1994 and again in 2004, 2007 and 2008.
So far this year, the Brazilian real has depreciated by about 9% against the U.S. dollar. At least part of the depreciation came after the government adopted a series of measures seeking to curb the currency's strength to protect local industry.
THE European Commission has moved to fix the EU's sickly carbon emissions trading scheme (ETS), as certificates fail to find buyers due to the recession.
"Is it wise to continue to flood an already oversupplied market? Clearly not," said Europe Union energy commissioner Connie Hedegaard on Twitter. "That's why (we) propose to change the auction time profile."
Brussels proposes a delay or freeze in auctions of the certificates from 2013 to 2020 to prop up sagging prices.
The ETS scheme, a centre-piece of EU climate policy, was set up in 2003 to discourage polluters and simultaneously raise funds to invest in clean and low-carbon energy, with the certificates being held by industries which can trade them if unused.
But the system is in trouble due to an oversupply of carbon allowances to industries which have slowed down in recessionary times. Prices on Wednesday were at seven euros ($A8.31) a tonne in comparison to the 24 to 30 euros needed to invest in renewables.
As the scheme widens and goes into its third trading period in 2013, some 8.5 billion tonnes of carbon allowances are to be put up for auction between then and 2020.
Business Monitor International (BMI) has predicted that investment in forestry and agriculture in the Amazon region will be boosted as a result of the new forestry regulations giving people more control over land rights. Bainbridge Island, WA, July 05, 2012 - Business Monitor International (BMI) has predicted that investment in forestry and agriculture in the Amazon region will be boosted as a result of the new forestry regulations giving people more control over land rights.
Brazil is one of the largest producers of soybeans and cattle in the world and the controversial new rights handed to land owners will make these areas of agriculture more attractive as investment options. This is according to international researchers at BMI whose view is also backed by Forestry Research Associates (FRA), a research and analysis consultancy specializing in forestry investment.
FRA's analysis partner, Peter Collins, said, "These new regulations have come at a time when the demand for beef and soy are growing in emerging markets. The regulations mean that more land could be given over to these agricultural activities, which is bound to attract more investment in to the region."
However, FRA is keen to promote a more sustainable option of investing in non-native forestry plantations in the Amazon region. These plantations, run by firms like Greenwood Management, involve focusing on fast-growing species that are not native to the region. As a result, timber products from these species are more sustainable alternative to the wood from the natural rainforests, which are vulnerable.
To read the full story click here.
Eastern European economies will expand at half last year's pace in 2012 as fallout from the euro-area debt crisis spreads, the European Bank for Reconstruction and Development said.
The 29 east European and central Asian countries where the EBRD invests will grow 2.7 percent in 2012, down from 5 percent last year, the London-based bank forecast today in an e-mailed report, cutting a May projection for 3.2 percent growth. Egypt, Morocco, Jordan and Tunisia, where the bank is expanding, will grow 2.1 percent, 0.1 percentage point less than seen before.
Central Europe, the Balkans and the Baltics are suffering from contagion because of trade and banking links to the debt- ridden euro area. Commodity producers including Russia, the world's largest energy exporter, are also at risk as the turmoil threatens global demand for raw materials.
"The biggest downside risk for the transition region is a possible further deterioration of the euro-zone crisis," said the EBRD, which was set up in 1991 to help transform the economies of former communist countries. The situation "is now impacting growth across emerging markets."
At Greenwood Management we often come across articles that may be of interest to you. We thought that instead of keeping you waiting for an entire month that we would start to send out individual stories, updates or articles of interest from time to time – this is our new mini newsletter service, 'Green News'.
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