By Dr. Eugenio Matos G. Hon. Associate Publisher, currently Chargé d’affaires a.i. Dominican Republic Embassy in The Hague.
TEN REASONS TO INVEST INTO LATIN AMERICA.
As per several NGOs and International Organisations, including the World Bank, Foreign Direct Investment (FDI) in Latin America will be a major global influence over the next decade. However, from the Netherlands side, unless boosted directly by Latin American government authorities, foreign Dutch investments in the region might not change dramatically in the next coming years. Commercial diplomacy c’est la mode, c’est la nouvelle diplomatie. It is the novel international relations trend, but only if well combined with a pragmatic Public Diplomacy programme. Panama serves as an example to the international community. Panama is already taking the lead with the recent official visit of President Martinelli to The Hague. Organizing a neat diplomatic reception at the Kurhaus, the visit to His Majesty, King William-Alexander, plus the business tour of Martinelli last May was a productive endevor for Panamanian Ambassador Jose Teran and his country.
So what are the top ten reasons why Dutch businessmen and international brands should cast their sights on investments into the Latin American region?
Viola some answers to that question:
1. Latin America has one of the fastest GDP growth rate in the world. 4.67% growth in 2011, compared to 1.52% growth in the European Union.
2. Latin America is already a major investment destination from the world’s leading economies. China is Brazil & Chile’s biggest single trading partner with Chinese state banks having lent more than US$75 billion to Latin America since 2005.
3. Latin America is a key trading partner with the USA, China, Japan, South Korea as well as the European Union.
4. Latin America has a GDP per capita higher than that of China and Middle East; US$9,593, US$6,768 and US$5,430 respectively.
5. Argentina has a higher proportionate number of consumers with a disposable income of over US$25,000, making it an attractive market for super luxury brands.
6. Latin America is the world’s power house for commodities e.g. Chilean & Peruvian copper, Argentine soya, Brazilian & Bolivian iron ore, Venezuelan oil, Colombian coal, Dominican Republic’s gold mines, tourism and call centres, huge opportunities in Costa Rica, Nicaragua, Mexico, Ecuador – the list goes on!
7. Panama is set to become a trade and cultural hotspot with the US$5.25 billion Panama Canal expansion scheduled for completion in 2014. Panama City is transforming into an energetic metropolis attracting investors, tourists and luxury brands.
8. Brazil plays host to the FIFA World Cup in 2014 and the Olympics in 2016.
9. Latin America has a highly-skilled and competitive human resources pool e.g. Chile is in first place in the Latin American Talent Index Ranking 2009.
10. The Latino love for life. Dance (such as Salsa, Bachata… and celebration is set to inspire on a global scale. Their FDI opportunities are linked to cultural issues. There are Latin American states where their popular music and gastronomy, represent a key overseas promotional tool.
The author is Commissioner in Holland of the Dominican Republic Department of International Trade-Foreign Investment (CEI-RD). Dr. Matos holds Civil law bachelor degrees in Canada and in the Dominican Republic, with Masters in Public Administration in England and diplomacy in Malta. He is currently accredited to the International Criminal Court and Alternate Representative to the OPCW in Den Haag.