Firearms, Natura &Co, and the Russian Ruble
Firearms, Natura &Co, and the Russian Ruble
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Today's charts:
Russia’s Ruble has been on the rise
Natura & Co’s acquisitions and revenues
Which country has the most firearms?
Make sure you check out the comment of the week at the bottom!
Currency ₽
Many Latin American currencies have been on a roll this year. The surge is best exemplified by the Brazilian Real, which has appreciated ~14% year-to-date. With the global supply chains struggling, commodity prices have risen, and a commodity-heavy country like Brazil (e.g., industrial metals and agricultural products) has seen its currency benefit. The Real has outperformed the Great Britain Pound, the Euro, and all other currencies, except the Russian Ruble.
After Russia invaded Ukraine, a conflict that tragically continues to this day and has left more than 4,600 dead, the Ruble went underwater. By March 8th, the currency had gone down 46%. NATO imposed heavy economic sanctions on Russia, like Germany’s suspension of a natural gas pipeline project, cutting Russia off the SWIFT financial system, and blocking access to the US dollar. All these sanctions caused the currency to become almost worthless, but Vladimir Putin had an ace up his sleeve.
Putin knows that he still holds a grip on the world with the largest reserves of natural gas, which account for about 40% of Europe’s supply, and cutting that relationship has been a harder sanction to impose. In March, he demanded that all countries that have been “unfriendly” towards Russia must pay for natural gas using only the Ruble, essentially forcing them to partake in Russia’s economy again. As in a crazy roller coaster ride, the Ruble has gone soaring past the Real to a ~21% growth year-to-date. Despite this victory, Putin is by no means out of trouble now. Most currency exchanges have stopped accepting the Ruble, and his country is facing double the US’s inflation rate, with a projected 15% shrink of its GDP.
Business 🌿
Antonio Luiz Seabra was an unlikely beauty expert. He began his career with a degree in Economics and sold typewriters for a living. In the 1960s, he discovered his passion for cosmetics as he managed a family laboratory in Sao Paulo. By 1969, he founded Natura Cosméticos with a little shop. Fifty-three years later, that small shop has turned into Brazil’s biggest beauty brand and the 4th largest “pure-play” beauty company in the world.
The beauty giant also leads the way in sustainability practices, making “positive economic, social, and environmental impact” parts of its core mission. At Latinometrics, we’ve read through more than a few annual reports. We have to admit that Natura &Co’s was the most uplifting we’ve seen, with many inspirational quotes like “we are living proof that together we are greater than the sum of our parts.” Financial performance stuff aside, the company reported key wins in its humanity department:
Women occupy 50.4% of its leadership positions
2M hectares of Amazon forest conserved
$59M invested in social and environmental causes
In 2012, the company made its first major acquisition, buying a stake in Aesop for $72M. Since then, its purchases have gotten much bigger. Its most recent one, Australian beauty brand Avon, was reportedly worth $2B. Since Natura &Co began trading publicly in 2004, its revenues have gone from $0.6B to $7.45B, a more than 12x growth (still, the stock has been struggling in the past year).
It’s encouraging to see a business committed to a better world growing in size. It all began with Seabra’s vision of using nature’s ingredients and a passion for giving customers beauty advice, considering beauty a form of self-respect. His philosophy “that we can nurture beauty and relationships for a better way of living and doing business” now operates in 73 countries and employs 35K+ people.
Demographics 🔫
A US-made gun is more likely to kill a Latin American than an American.
As the gun debate in America continues following another mass shooting, we decided to look at Latin American rates of firearms ownership.
Uruguay has the highest concentration of firearms in Latin America, with an estimated 35 civilian guns per 100 people. There are close to 1.2M firearms in the country of 3.5M, half of which are estimated to be illegal. Uruguay's gun ownership rate is higher than countries like Iraq (19 weapons per 100 people) and its neighbors Argentina (7.3) and Brazil (8.2)—but far from the United States, which has 120 guns per hundred citizens.
With more than 200K firearms trafficked every year from the US to Mexico, most of the guns on this chart were likely smuggled from the US; and The Economist reported that 70% of Mexican gun crimes involve weapons purchased in the United States. This fact highlights another vital topic not often addressed when discussing gun control in the US: the problem of gun violence in Latin America, a leading cause of death in the region. Of course, poverty, lack of opportunities, and gang culture contribute to high levels of gun crime in LatAm countries. However, to understand the issue of gun violence in LatAm, it is also essential to first consider that much of its origin can be traced back to guns smuggled into the region from the US.
The data on gun ownership in Latin America underscores the need for stricter gun control measures not just for the US, but also for the sake of its southern neighbors. Many gun enthusiasts don't believe that gun control will help save American lives — but they might recognize that stricter gun laws in the US could help decrease the flow of weapons to LatAm and consequently save lives south of the border. It's time for a hemispheric approach to tackling this problem.
Realize Latin America’s Potential 🚀
Hand-selected job opportunities based on what we know about our audience (e.g., industries, job functions).
This week’s opportunity:
Natura &Co has 17 open positions throughout Brazil, Mexico, and Argentina (LinkedIn)
Hiring Managers: Reply to this email if you’d like to feature an open role in our newsletter.
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That’s all for this week 👋
Want more?
This week's best comment was posted by the CEO of Nowports. He shared our graph about his Unicorn startup along with some kind words. Thanks so much, Poncho, it means a lot! 🙌
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