MEXICO CITY—Foreign direct investment in Latin America and the Caribbean is recovering from pre-crisis levels thanks to the boom in commodities and the rising interest of China in the region.
Investment by foreign entities rose by 40% in 2010 to $113 billion, a report by the United Nations showed. South America, and in particular Brazil, was the primary beneficiary of the funds, followed by Mexico, said Alicia Barcena, executive secretary of the U.N. Economic Commission for Latin America and the Caribbean (ECLAC.)
The return of foreign investors is a welcome sign after flows to the region contracted by 45% in 2009 in the wake of the global financial crisis.
Foreign investment in South America rose 56% to $85.1 billion, driven by investors looking to tap into Brazil's large domestic market and to stock up on commodities such as oil and copper.
Brazil received $48.5 billion in 2010, or 87% more than in the previous year, and the country's principal source of investment was China, which injected $7.5 billion into the economy. Foreign investment in Brazil this year will easily top $50 billion, the U.N. Commission predicted.
Emerging markets represented 53% of the total foreign investment flows last year, and Latin America and the Caribbean showed the strongest growth of any region, the U.N. said.
Ms. Barcena attributed the recovery in investment flows to companies wanting to tap domestic demand, primarily in Brazil, but more importantly to investments in commodities.
Foreign investment in Mexico rose 17% on the year to $17.7 billion, Ms. Barcena said, with most of that investment going into the manufacturing sector. This year Ms. Barcena expects that figure to top $20 billion.
Within Central and South America, investment flows rose in every country except Colombia, Ecuador and El Salvador -- which saw declines. Investment flows to the Caribbean also fell, with the exception of Haiti, which saw a 303% spike in inflows following the 2010 earthquake.
Source: http://online.wsj.com
Investment by foreign entities rose by 40% in 2010 to $113 billion, a report by the United Nations showed. South America, and in particular Brazil, was the primary beneficiary of the funds, followed by Mexico, said Alicia Barcena, executive secretary of the U.N. Economic Commission for Latin America and the Caribbean (ECLAC.)
The return of foreign investors is a welcome sign after flows to the region contracted by 45% in 2009 in the wake of the global financial crisis.
Foreign investment in South America rose 56% to $85.1 billion, driven by investors looking to tap into Brazil's large domestic market and to stock up on commodities such as oil and copper.
Brazil received $48.5 billion in 2010, or 87% more than in the previous year, and the country's principal source of investment was China, which injected $7.5 billion into the economy. Foreign investment in Brazil this year will easily top $50 billion, the U.N. Commission predicted.
Emerging markets represented 53% of the total foreign investment flows last year, and Latin America and the Caribbean showed the strongest growth of any region, the U.N. said.
Ms. Barcena attributed the recovery in investment flows to companies wanting to tap domestic demand, primarily in Brazil, but more importantly to investments in commodities.
Foreign investment in Mexico rose 17% on the year to $17.7 billion, Ms. Barcena said, with most of that investment going into the manufacturing sector. This year Ms. Barcena expects that figure to top $20 billion.
Within Central and South America, investment flows rose in every country except Colombia, Ecuador and El Salvador -- which saw declines. Investment flows to the Caribbean also fell, with the exception of Haiti, which saw a 303% spike in inflows following the 2010 earthquake.
Source: http://online.wsj.com
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