All international analysts agree in asserting that Latin America has excellent prospects and will continue its process of economic expansion in the coming years. This growth, however, according to the recent analysis published by the Inter-American Development Bank, is characterized by a division into two groups of countries which run at two different speeds and which have distinct perspectives and trends.
On the one hand, the bloc led by Brazil emerges which brings together the countries exporting raw materials and which is oriented towards emerging markets; on the other, the one led by Mexico, which maintains a model more dependent on industrialized countries.
The 2008 crisis undoubtedly reshaped the balance of power in the global scenario, creating a new economic order not exactly similar to the previous one. The emergence of the dynamic BRIC countries, but not only, has triggered a mechanism with economic and commercial repercussions also for the Latin American Subcontinent, which has been able to benefit from these changes. From the report drawn up it is clear that the Latin American nations most constrained Emerging countries present better macroeconomic conditions, and the thesis of the Inter-American Bank tends to demonstrate how the solid economic growth of Latin America is not uniform, but masks two different speeds.
The first model led by Brazil, in which GDP growth in 2011 is expected to be around 4.4%, fits very well in the international scenario and presents prosperous prospects. The export of raw materials to the main emerging economies, and the Asian ones in particular, further fuels growth and constitutes a real keystone for the development of the Subcontinent. In this group, in addition to the aforementioned Brazil, there are Argentina, Bolivia, Chile, Colombia, Ecuador, Paraguay, Peru, Uruguay, Venezuela and Trinidad & Tobago and these are countries that benefit not only from the high prices of raw materials but also of the strong entry of foreign capital flows.
On the contrary, the group led by Mexico, whose members have much stronger trade relations (especially of goods and services) with industrialized economies, will record a +2.7%, due to the slow exit from the crisis of the countries that constitute their main markets, especially the European Union. This block, which includes importers of raw materials, includes Mexico and all the Central American and Caribbean countries (except Haiti).
The data reported in the analysis also testifies to the differences between the leading countries of the two sides. In 2006, Brazil exported 9% of its products to its BRIC "members" (Russia, China and India) and in 2009 the figure increased to 17%; on the contrary, exports to industrialized countries experienced a decrease from 50% in 2006 to 44% in 2009. The trend of the Mexican economy is configured differently, with a share of exports to the BRICs which represents only 3% of the total of 2009, while the figure destined for exports to industrialized countries reaches 91%. In a global context in which the recovery from the crisis that began in 2008 was driven by emerging countries, it is therefore understandable why the Inter-American Bank deemed it appropriate to make this distinction.
The economic challenges and commercial opportunities that Latin American countries will have to face in the coming years will above all concern the ability to increase and consolidate their presence in the Asian, European and United States markets. The current international situation favors the rise of the Latin American macro-area, whose governments will however have to be able to carry out further macroeconomic, fiscal and commercial measures, aimed not only at reducing vulnerability and dependence on the outside, but also at contain the inflationary threat, fueled by the increase in oil and food prices.
Despite the various peculiarities of the Latin American economy, the path towards more sustainable economic development that can allow players from this region to play an increasingly important role in the globalized context is viable.
READ ALSO:
The success of Italian companies in India
Internationalizing your business abroad: strategic choice or opportunity?
Digital Export Manager (DEM): internationalization in a digital context
Are you interested in our service?
Fill out the form or contact us at the number
+39 059 9770184
