Latin America, Overview of Economy, Business and Challenges

Latin America An Overview of Economy, Business and Challenges Introduction Latin America suffered during the years of 1980-1990 with political instability and low growth rates. Nowadays the situation is different, the region is improving towards economic stability and grater democracy, however the reforms performed during the last decade are still incomplete. High rates of poverty and bad income distribution remain as the main problems of the region. The last few years has shown that Latin America economy is getting stronger and growing at unprecedented rates in the recent decades, making the environment for business much more attractive. Economic Overview and Challenges From the middle 1980s to the beginning of the 1990s†¦show more content†¦Even inside the region is possible to find examples of favorable effects of a high trade openness, the experiences of Chile (through unilateral liberalization) and Mexico (strongly benefited from NAFTA and a bigger trade with USA). One topic pointed by the World Economic Forum on Latin America as key factor for the development of the region is the necessity to adapt to the increasing participation of China and India in the economy of the world. At the same time, China is becoming a important importer of commodities from Latin America and a competitor in textiles and labor-intensive manufacture goods. The region have to take advantage of the opportunities raised by China s growing economy and, at the same time, adapt to its competition. Consumer Characteristics The Latin America consumer market is composed of 550 million emerging consumers, with average yearly per capita incomes of USD 4,000, immense natural resources and substantial human capital. It accounts for eight percent of world production and grew by more than five percent in the past three years. The consumer market in Latin America is very diversified, is not just an aggregate of low income and poor consumers, as most people would think. 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