2012-02-15

The South American trade off

South America is slowly waking up and is expected to become a major market mover along with the United States, China and India by 2050. The region has a relatively young population and a growing middle class, which means a strong foundation and continued economic growth, particularly in the long term. And among all the countries in South America, Brazil has the potential to be the leader of the pack in the region. It has the largest economy in Latin America and is already the ninth largest export market in the world. While the rest of the world talks about the economic downturn, in some regions within Latin America, the economy is growing at 9%.

From mining to retail to software development to data integration, the region beckons all streams of business. With the 2014 World cup and the 2016 Olympics coming up in Brazil, the opportunities are huge. It is just a matter of tapping into the right business when the time is ripe. Peru and Chile beckon the mining businesses with its vast potential that is yet to be tapped. Columbia is fast developing to be a regional power while the Mercosur, consisting of Brazil, Paraguay, Argentina and Uruguay is a great place for all business opportunities.

As long as the business is armed with resource and trust, the business cannot fail. The right capabilities can be in-house or outsourced and will prove to be a boon for the business. Though corruption continues to worry aspiring businesses in the region, it is no different than in any other country and is perhaps exaggerated. Currently, the exchange rate is favourable to the British pound. Some British companies like Mothercare are already in the region and have chosen smaller markets to enter in the region – a sensible strategy. The primary thing is to understand how the market works and not depend on the stats alone. The region is sure to be a winner for the business that grasps the opportunity.

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