Punta del Este is an upscale vacation spot on the southern tip of Uruguay, southeast of the town of Maldonado and about 140 km east of Montevideo. At the beginning of the 19th century, Punta del Este was a vast semi-deserted region only visited by sailors and fishermen. Today this coastal town, commonly referred to as the St Tropez of South America, attracts close to 300,000 visitors each year.
Opposite the large peninsula separating the two waters of the Atlantic Ocean and Rio de la Plata, lie the enchanted islands of Isla Gorriti and Isla de los Lobos, inhabited by one of the world’s largest sea-lion colonies.
About Uruguay
Uruguay used to be South America’s best-kept secret with only a handful of South Americans travelling there to enjoy its lovely beaches, beautiful cities and huge gaucho steaks. It is bordered by Brazil to the north, by Argentina across the bank of both the Uruguay River to the west and the estuary of Río de la Plata to the southwest, and the South Atlantic Ocean to the southeast. It is the second smallest independent country in South America, larger only than Suriname and the French overseas department of French Guiana. Formerly called the Swiss of South America, Uruguay may be very small, but it’s certainly big-hearted where attractions are concerned. It features one of the most interesting capitals (Montevideo) in South America, several charming colonial towns, the hilly interior – true gaucho (cowboy) country – and many internationally renowned beach resorts such as Punta del Este and Piriapolis. The economy is largely based on agriculture (making up 10% of GDP and the most substantial export) and the state sector, and relies heavily on world trade. Consequently, it is affected by any change in global prices. Uruguay’s economy is on the whole more stable than in its surrounding states, and it maintains a solid reputation with investors. Uruguay’s main attractions are its beaches, so most visitors go in summertime. Along the River Uruguay, summer temperatures can be hot, but the hilly interior is colder, especially at night.
A recent survey commissioned by the Brazilian Ministry of Tourism revealed that British buyers made up seven per cent of the overseas spend on residential property, parting with £28 million in 2007.
The main focus of property investment in Brazil is in the large cities of Sao Paulo and Rio de Janeiro, and the nine states of the north-eastern region.
Nara Vidal of Brazilian Gateway says: “My personal choice has to be Sao Paulo because of what it represents in terms of Brazilian economy and development. Sao Paulo city alone is responsible for more than 12 per cent of Brazil’s GDP and its property market is by far the strongest in Brazil. It is the most populated city in South America and has a huge deficit of accommodation, specially for the mid and lower income classes that now have more buying power due to credit allowance. A strong market such as Sao Paulo, offers not only the highest rental yield and capital appreciation but also a straightforward exit strategy for investors interested in investing elsewhere afterwards.”
The north-eastern states are the subject of a concerted push to attract overseas property investment. The states have teamed up to form ADIT Nordeste, a government-funded association aimed at attracting property investment from overseas tourism and real estate investors. Its third annual Nordeste Invest conference, held earlier this year in the coastal city of Recife, is estimated to have generated £727 million of business.
One area about to feel the benefit of these efforts is Alagoas, which has previously been relatively untouched, but is now being tipped as the country’s first six-star destination. International brands such as Radisson and Invest Tur (Six Senses and Txai brands) are investing here, and Felipe Cavalcante, president of ADIT Nordeste, says: “The local government is focusing only on high-end real estate projects so the state receives the best developments in the country. It is wonderful to see that the natural beauty of Alagoas will be enhanced by all these top quality real estate projects.” Paul Bartlett of EM Concepts says: “Many different parts of Brazil are good for property investment. However buyers need to be aware of market saturation in some second-home and popular destinations such as Natal. Look to Fortalaza, where you will find competitively priced ‘A-class’ condos, and Itacare if you are looking for beach property.”
As one of the BRIC countries, Brazil’s booming economy is resulting in significant capital gains. Nara Vidal says: “With the unprecedented prosperity of our economy, some areas in Sao Paulo have seen capital appreciation of around 20 per cent in 12 months. We forecast an average of nine to 10 per cent rental yield in some of the developing areas, and capital appreciation that will easily reach 25 to 30 per cent in the next year.” Paul Bartlett adds: “Capital appreciation has been around 20 per cent over the last couple of years and we would expect a rate of around 10 to 15 per cent per annum in the coming years provided inflation is not too disruptive to economic growth and loan rates.”
Nara Vidal recommends serviced apartments as the best property investment in Sao Paulo. “Contrary to the general belief that serviced flats are for tourists or executives, a very big number of “Paulistas” live in serviced flats for convenience and flexibility. The rental yield in many cases is a massive 12 per cent net, including management fee. It is definitely the best investment right now. Paul Bartlett agrees saying but adds: “For maximum capital growth it would make sense to look at beach homes in the growing coastal cities such as Maceio, where prices are still low but should rise fast.”
Although the fundamentals for Brazilian investment are there, Nara Vidal adds a note of caution: “An investor needs to have a clear picture when investing in property in Brazil. Brazil is no tropical paradise and crime rates are still high, although increasingly low. Human development remains a challenge and corruption is still a problem. On top of that, bureaucracy is a huge obstacle when investing in Brazil as purchase process can take longer than expected. It is crucial to choose a professional agent in the UK. Sadly mortgages are in their infancy in Brazil and we do not advise foreigners to take a Brazilian mortgage as interest rates are still high – around 11 per cent.”
Come to think of Brazil, and you’ll immediately get transported to the football capital of the world! The land of Ronaldos, Ronaldinhos, Peles, and Romarios is the next projected global economic powerhouse. Occupying almost half of the South American continent, Brazil is the fifth largest country in the world. Considering its vast size, the Brazilian population of around 190 million is miniscule, to say the least. This is because sea-loving Brazilians are mostly concentrated around the coasts. It is estimated that around two-third of the nation’s population is situated along the coastline. This leaves a vast chunk of the country’s mainland open for development projects, and a virtual goldmine for the global property investors.
What Makes Brazil a Hot Investment Destination?
Brazil has many attractions that allure the people from all over the world to this Samba land. The country is a major tourist hub of South America. It’s not just the soccer-crazy Brazilians that invite attention, but also the entire Brazilian lifestyle that has lent a unique identity to the country.
To start with, the country plays host to the world’s biggest rainforest – The Amazon. This is reason enough for the nature loving tourists to flock and hook up to Brazil for days, and witness the wildlife-rich wetlands of the Pantanal, the canyons and caves of the Chapada Diamentina, and the Mata Atlantica (Atlantic forest), which runs for much of the length of Brazil’s coastline.
Brazilian seashore adds to the charm of the country with sun-kissed beaches dotting over 7000 kilometres of coastline. The legendary Copacabana and Ipanema beaches are just some of the magnificent water-features of Brazil. The aquatic sports are also one of the major highlights of the Brazilian beaches.
If you think you’ve heard enough of Brazil, we are not done yet! The Annual Carnival at Rio de Janeiro is synonymous with the Brazilian way of living – dancing to the tunes of samba and merrying about all night! This not-to-be-missed annual event is attended by millions of revellers from around the world and attracts global media coverage.
Another major reason, besides tourism, behind the growth of the property market in Brazil is the country’s booming industry. Brazil is one of the few countries that have mastered the art of ethanol-blended petroleum products. This technology is of massive help in curbing rising pollution levels due to the burning of fossil fuels the world over.
The country is largely seen as one of the fastest developing economies of the world along with China and India, and if the trend continues, Brazil will be a jackpot destination for every real estate investor. A largely peaceful country, Brazil attracts Europeans for its low cost of living, which is just 20% of that in the UK/Europe.
The proactive government developmental policies, along with the favourable currency exchange rates fuel the robust property sector all across the country. Brazil is well-connected with major cities of the world through regular flights in and out of the country. The lively Brazilian people have a rich tradition of living life to the hilt, is one factor that clinches the deal for Brazil as a hot real estate destination.
Hottest Investment Locations in Brazil
Currently, Brazil enjoys one of the fastest growing property markets in the world. Therefore, you can be rest assured that money spent on property in Brazil is a wise investment translating into greater appreciation for the capital in a short period of time. And before you jump on the Brazilian bandwagon, here’s another happy piece of information you’ll love to hear. Millions of foreign nationals own property and business in Brazil benefiting from the fact that property ownership is guaranteed by the Constitution for Brazilians and foreigners alike. And land ownership in Brazil is in perpetuity, which includes full mineral and water rights.
Any kind of coastal property in Brazil is worth a goldmine. Since most of the population and tourists’ activities are centred on the coastal areas of Brazil, cities like Rio de Janeiro and Sao Paulo are always on top of the investment chart. For a little over £50K, you can enjoy beachfront apartments, duplexes and villas in Natal, or residential club villas in Fortaleza. Of course, several low-priced properties are also available in every segment – off-plan, built-up, or land.
If you are looking to capitalize on the vast agricultural land in Brazil, the places like Western Bahia State should be your choice of destination. Brazil is expected to be self-sufficient in terms of food available to its citizens, within a few years. Thanks to the mineral-rich fertile soil of the country, the cities, like Louis Eduardo Manghales, have emerged as agri-hubs in Brazil. Obviously, the developed agricultural land will cost you a little more than the uncleared land in areas, like SE Tocantins, which is believed to contain a hugely fertile land, but development here is still some years away.
Some other places ideally suited for investment in residential and commercial property include the towns of Rio do Conseicao, Dianopolis, and Rio Grande de Norte.
Brazil has investor-friendly laws, byelaws, and regulations. However, you may require the services of an attorney or a estate agent for successfully negotiating and transferring the property. There may be certain formalities to be satisfied before you can legally own a property in the country, but these are not very technical formalities that require much effort on your part. Read our buyers guide on Brazil for more details.
Property Abroad’s directory Les Calvert writes interesting and useful articles on all subjects dealing with overseas property and buying property abroad. With over 400 company websites selling and renting property in almost every country around the world Les is well placed to offer advice on existing and emerging property locations around the world. Visit their flagship site for buying property in Brazil. Visit their website dedicated to investment property if you are considering buying an investment property abroad or in any country around the world.
The year 2008 saw many grief stricken property owners pulling out their hair in disbelief as the world markets came crashing down around them. The UK, USA, Europe and China were worst affected with inflation pushing many people’s income to stretch further than ever before, especially to cope with debt repayment and the loss of value of fixed assets.
South Africa did not escape unscathed and the population has definitely felt the sting of increasing food prices and inflation. Inflation grew to 11.5%, a major increase for a time frame as short as a year. The property market was reported as having ‘crashed’, leading to a major drop in property prices. Nominal returns on property values dropped far below the 27.5% which 2007 yielded and were the lowest recorded since 2002. Equities and property equities suffered a defeating -23.2% loss in 2008 whilst the JSE PLS Index returned -2.3% and the JSE PUT Index returned -9.7%.
These statistics may seem unsettling but South African property did perform somewhat in 2008, especially in comparison to other countries’ real estate markets. Despite the comparatively low yields on investments, the commercial property market has surprised many with far greater nominal returns than in other countries. Property developers and financial consultants warn that while the yields of 2008 are far less than 2007, the returns made have been satisfactory, especially considering the global financial crisis.
The Sapoa/IPD Property Index has revealed that investments in South Africa’s commercial property market produced a nominal return of 13%. This double digit figure is the highest in world commercial property for 2008. Despite the inflation rate taking this percentage to only a 1.3% increase from 13%, the return is a positive reflection of the greater financial stability of South Africa and especially its property markets when measured against other countries in Europe, Asia and the USA.
The UK and Ireland were heavily affected by the recession in 2008 with property values dropping due to yield rises across all sectors. The UK experienced nominal returns of -22.1% and Ireland -34.2%, a staggering loss in comparison with the 13% increase of South African commercial property. Continental Europe achieved varied returns from commercial property in 2008 whilst Asia suffered a staggering loss in comparison to last year’s returns. South Korea saw a drop from 26.7% in 2007 to 4.0% in 2008. North America achieved returns of 3.7% and Australia 1.3%.
Offices and industrial spaces achieved returns of 9%, whereas retail property made returns of 7.8% producing an average income return of 8.3% for all property. The cause of the positive returns has been linked to the pricing structure and financial markets in South Africa remaining somewhat stable. Even though the inflation rate of 11.5% has caused prices to soar, the effects were not felt nearly as heavily as in the UK, USA and Asia. Robust and capital income growth was positive throughout 2008 and whilst consumer confidence was a little threatened, commercial property investment was made to a far greater level than in other countries.
The positive returns on commercial property investments during 2008 in South Africa are a clear indicator that the property market in South Africa has a greater stability than elsewhere in the world. Despite the comparative drop to last year’s property returns, and the influence the recession has had on world property markets, South Africa’s commercial property marketing has emerged successfully. Buying commercial property at this time is a lucrative investment as prices are lower than average but the return is still positive and fixed assets are not depreciating in value.
The year 2008 saw many grief stricken property owners pulling out their hair in disbelief as the world markets came crashing down around them. The UK, USA, Europe and China were worst affected with inflation pushing many people’s income to stretch further than ever before, especially to cope with debt repayment and the loss of value of fixed assets.
In this article we look at the origins of coffee from the South American continent.
Brazilian Coffee – Brazil produces roughly a third of the worlds’ coffee, but the bulk of it is of the Robusta variety and is not considered to be of high quality. It is mainly used for blending, and the Brazilians have always had the priority of low price over quality.
However there are some excellent Arabica coffees grown around the Sao Paulo region, where the well know Santos or Bourbon Santos bean are produced. Another popular variety is the Rio, a dry-processed bean with a characteristic medicinal-like flavour. Considered a defect by most westerners it is however much loved in the Balkans and Middle-Eastern countries.
Coffee From Colombia – Colombia produces a large amount of excellent and consistent quality – predominately Arabica – beans each year. It is now the biggest producer of Arabica coffees on the planet.
The standard Colombian coffee is wet-processed, and is grown by small farmers or smallholders – mostly in the three main mountain ranges (called cordilleras) – and collected, processed, milled and exported by the Colombian Coffee Federation. It is all well balanced, has excellent consistency and can range from a superb, high-grown, mildly fruity flavour, to a rather ordinary, yet still fruity coffee.
The coffee industry in Colombia is known the world over for its high quality production.
Peruvian Coffees – Despite domestic political problems, Peru still manages to figure among the top ten coffee producers in the world.
The best Peruvian coffees are high grown arabicas, which are flavourful, aromatic, gentle, and mildly acidy, and they are highly valued for their blending properties.
Ecuadorian Coffees – In 2007 Ecuador produced nearly a million bags of both arabica and robusta coffees. These coffees are medium-bodied and fairly acidy, with a straightforward flavour typical of most Central and South American coffee.
Whilst the country has everything to produce top quality coffees, in fact most of the coffee exported is aimed at low price rather than high quality. Much of the coffee is consumed within the country itself.
Venezuelan Coffees – Venezuela used to produce large quantities of coffee comparable to that of Colombia but since the discovery of oil it’s past glories have waned substantially so that today Venezuela only produces around 7% of Colombia’s production. Most of this is drunk by the Venezuelans themselves.
Unsurprisingly the best arabica Venezuelan coffee comes from the far western corner of the country – the part that borders Colombia.
Coffees from this area usually are called Maracaibos, after the port through which they are shipped. The best-known Maracaibo coffees are Caracus, C?a, M?da, Trujillo, and T?ira. Regardless of market name, the highest grade of Venezuela coffee is Lavado Fino, (fine washed)
Look out for my other articles in this series of coffees from around the globe.
The word for ValGold (TSX.V: VAL) is “busy”. In conversation, they’re upbeat and enthusiastic about their new Venezuelan and Guyanan acquisitions, “Literally just waiting for the equipment to arrive”, according to Investor Relations Officer Jeff Stuart. In the meantime they’re drilling, compiling data from past drill programs and building a vast knowledge base – from scratch in some cases.
In late November, the company announced high-grade assays from the Tower Mountain Gold Property, located in the Matawin Gold Belt, 40 km southwest of Thunder Bay, in Ontario. Intersections of high-grade gold occurred in TM-07-56, where 1.5m graded 58.20 g/Tonne Au (1.697 oz/t gold) and in TM-07-58 where 1.5m averaged 18.70 g/Tonne Au (0.545 oz/t gold).
The drill program was a short run – eight holes – but added a wealth of knowledge to the existing data from seven drill programs comprising 67 drill holes, totaling 16,618 metres, completed between 2002 and 2005.
The news from Tower Mountain is good: mineralization in all eight holes. The data has painted an increasingly attractive picture of the mineralized systems here. To wit: The main vein appears to range from 0.6 to 20 meters in true width, with a narrow high-grade core (up to 160 g/t Au over 1.5 m) and a more moderately mineralized periphery. Even low-grade data here should prick up the ears of savvy investors: 0.94g/t over 106.5 m, for example.
Meanwhile, back in South America, a growing pool of data, including assay results from a 2007 drill program at the Los Patos occurrence in Venezuela, indicates the presence of significant gold mineralization, including substantial near-surface mineralization. The data is also considered “highly prospective” for other minerals, including alluvial diamonds, and preliminary radiometric indications of uranium, copper-nickel and/or platinum group metals.
This is the point where listed miners have to prove their mettle – excuse the pun – and ValGold has adopted a no guesswork approach, utilizing the whole spectrum of survey. Some areas are almost entirely lacking, in terms of market-standard information.
ValGold’s South American concessions total approximately 3,570 square kilometres, and relate to a geological formation known as the Guiana Shield, which underlies northeastern South America. It is comprised of ancient Archaen and Paleoproterozoic blocks. Geologists are faced with some of the most demanding and potentially rewarding work their field has to offer in these very old structures, where mineralization is complex and highly evolved.
ValGold CEO Stephen Wilkinson, who has three decades of mining experience, provided some useful insight in a recent interview on Smartsox.com regarding the geological and gold mining history of the region. Venezuela’s gold potential was first recognized in the 1890s, when the British military discovered and mined considerable amounts of gold from surface deposits – 13 tonnes of it, according to Mr. Wilkinson, a huge amount for the time.
The Venezuelan holdings comprise three concessions in Bolivar State, acquired from Honnold Coporation in October for $8 million in cash and shares, of which $2 million has already been paid. The company has benefited from a positive exchange rate, where appreciation of the Canadian dollar against the US dollar resulted in a saving of 25% – $2 million – on net outlay.
ValGold has been conducting systematic drills across its concessions, notably the Los Patos Gold Occurrence, where a 7,971 metre, 28-hole program was completed in the summer this year. The company found visible gold in a drill core from this region, reflecting the high-grade nature of mineralization here – just 4.5 km northeast of Crystallex’s La Tomi gold mine.
The Los Patos gold occurrence is actually located within ValGold’s Lo Increible 3 concession and is one of several gold occurrences found along the east-west striking, 6.8 km long, Los Chivos Shear Zone.
The other two Venezuelan concessions are collectively called the Chicanan Concessions: The Carolina and Mochila Occurrences, which comprise a variable geology. The Carolina Occurrence has had some prior exploration, but the primary geological feature, the Mochila Lineament, containing two large gold occurrences, has had no previous drilling. ValGold is currently conducting a diamond drill program of 20 holes in the Mochila Occurrence, expected to be completed soon.
ValGold’s due diligence report for October 9, 2007 contains important preliminary data, and helpful technical information regarding associated geological features and prospects. This was the basis of the ground work for the current Fall Winter 2007 program of ongoing exploration.
The report on the Los Patos drills refers to mineralization as “open in all directions”. ValGold drilled 35 holes at the “Lo Increible” site, which returned findings across a total accumulated length of 9318 metres. The report states, “Mineralized zones averaging as high as 7.25 g/t gold over a true width of 19.0 metres (0.21 opt over 62.3 ft) have been intersected. The final hole of the first round of drilling returned an intercept of 3.0 m in width grading 13.67 / tonne.”
The Chichanan East and Chichanan West concessions relate to the gold-bearing Chicanan-Carolina Shear Zone, which transects the region and is comprised of a saprolitized greenstone belt that ranges from 5 to 20 km wide. The Chichanan East region (meaning east of the Chichanan River) has been systematically evaluated before, but the Western side, which is part of the Mochila Complex, has had little work. Three areas of gold mineralization have been outlined, and the company notes that “In the Serucha area, drill holes have returned gold grades of up to 1.05 g/t over 71.2 m and in the central Carolina area 4.05 g/t gold over 10.24 m. Practically all of this mineralization is saprolitic in nature and could be readily extracted from shallow, long, linear pits.”
The four properties comprising the Guyana concessions were acquired from Newmont Overseas Exploration, a subsidiary of Australian gold miner Newmont Mining Corp. The mutually pragmatic deal reserves some back-in rights for Newmont, in return for a 100% interest acquisition by ValGold.
ValGold is now organizing its holdings and acquiring relevant licenses for each of its properties. The company has identified a large band of deposits worthy of exploration, and is obviously keeping its rights clearly defined so it can explore thoroughly. That looks like the best, most cohesive, way to approach ongoing exploration, manage interests economically, and avoid any complications with rights issues and third parties.
ValGold have been making friends in the region. They’ve acquired the valuable local knowledge and expertise of new director on its board, Pedro Tinoco, one of Venezuela’s veteran senior mining experts. Mr. Tinoco is the former President of the Latin American Mining Organization from 1996 to 2006, where he’s still an active member.
Also making friends are the locals around ValGold’s various works, who’ve suffered from illegal mining operations in the region conducted by foreign miners who’ve been “cutting a swathe” through the areas they mine, according to Mr. Stuart. This mining equates to nothing less than taking the food out of the mouths of the inhabitants, so ValGold is bringing some equity and prosperity into the region with its operations, too.
One thing for certain: ValGold won’t get dull.
This article is intended for information purposes only, and is not a recommendation to buy or sell the equities of any company mentioned herein. It is based on sources believed to be reliable, but no warranty as to accuracy is expressed or implied. The opinions expressed in the article are those of the author except where statements are attributed to individuals other than the author, in which case the opinions are those of the individual to whom they are attributed.
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Do you travel less often? In that case you might decide to purchase your travel insurance from the tour agency that is conveying you. However, if you travel frequently it will be cheaper if you can afford an insurance that will cover you for a long time than to keep picking one whenever you are traveling.
With annual travel insurance you stand to be highly compensated in the event of any of the following: sickness, stolen or damaged belongings and several other situations that might require reimbursements.
Do you know that credit card companies provide annual travel insurance? What’s more, they also offer additional benefits such that in the event of loss or theft of a customer’s credit card, the customer stands to be furnished with another one in no time.
If there are readily available agencies that offer annual travel insurance then it is insurance companies. Once you have taken one or multiple policy insurance from an insurance company you are already a client and will be eligible for discounts.
Are you considering working with a new insurance company for a good annual travel insurance? Then don’t waste time to inform them about the other properties you have, which you might be willing to insure with them. This will produce great discounts for you.
If you plan to travel to South America or Africa or any other place outside your home country, be sure to look into travel insurance. All the various options for insurance are listed above, so I hope you make use of that information to find the best protection possible for you and your family.
Jon Sharm caught the travel bug at age 20 and has travel to South America 6 times, and three times to the Middle East. Visit his blog Travel to South America.
