As the United States and Europe face a bleak financial reality, Latin America hums along with continued growth and optimistic predictions for the next few years.
The latest rosy report came Tuesday from J.P. Morgan (Informe publicado abajo), which released a survey of 40 institutional investors in North America and Europe, finding them upbeat about investment opportunities in Latin America over the next three years and applauding improvements in investor relations.
A majority of these investors, who together hold approximately $57.3 billion of actively managed equity in Latin American companies, view Brazil as the country with the highest investor-relations standards. Mexico, along with Peru, ranked last, partly because of the disparity in investor relations standards between blue-chip companies (which make it easy to find and obtain information for investors and shareholders) and smaller companies (which tend not to be as open with their information).
Survey participants named Brazil and Colombia as the most promising countries for investment opportunities over the next three years; Brazil’s rapidly expanding middle class promises to yield tremendous growth, while Colombia’s pro-business government is attractive to investors. Argentina and Venezuela were viewed as the least promising, because of the perception of unstable or unpredictable governments.
The economy in Latin America is getting a fair amount of attention as a relative bright spot.
A World Bank report published last week attributes the region’s growth to its increasing economic ties to China. Ten years ago, there was almost no commerce between the two; today, China is one of the biggest trading partners for some of the region’s economic powerhouses, including Brazil and Chile.
But the commercial honeymoon between China and Latin America may be coming to an end. Francisco J. Sánchez, the United States under secretary of commerce for international trade, visiting Mexico City on Tuesday to promote business, said that high transportation costs, extended delivery times and high import tariffs were reversing this trend. “We are seeing more and more businesses returning to this hemisphere,” Mr. Sánchez said. Investors are taking note.
Economix. The New York Times.
