Despite global volatility and the possibility of an economic slowdown in China, many still say they’re bullish on the region and its opportunities.
In the past few years, analysts say you could draw a line at Panama and pretty much predict that those economies north of that imaginary boundary were struggling and those to the South were doing well.
With a few exceptions, the analysis that countries more linked to the faltering U.S. economy, such as Mexico and those in Central America and the Caribbean, have shown slower growth and commodity-rich countries whose trade is tied to Asia, especially China, have outpaced their northern neighbors still holds up.
But with jitters about the euro zone crisis spreading, fears that a Greek default may still be in the cards and the possibility of a slowdown in the Chinese economy, questions loom for Latin America and the Caribbean.
“The European crisis will end badly and there will be some impact but not as much’’ as the old days when a global slowdown would push the region into a downward spiral, said Victor Manuel Rocha, former U.S. ambassador to Bolivia and now a senior international business advisor in the Miami office of Foley & Lardner.
“What happens in China is more important to Brazil than what happens in Europe,’’ he said.
Latin America also is better prepared to handle an economic storm than it was in 2008-2009. Not only has the region learned lessons from that crisis, but many countries have built up their international reserves and continued economic reforms.
That’s especially true for countries blessed with iron ore, copper, oil and vast expanses of land for production of the soybeans, wheat and cattle that China buys.
Most of the region’s economies will post respectable economic gains this year, but 2012 could be challenging if global demand slackens and commodity prices fall.
“This time around, China itself looks more likely to suffer a significant slowdown’’ with its own debt and developing manufacturing bottlenecks as contributing factors, said Lord Mark Malloch-Brown, former British minister of state and chairman of the global affairs practice at FTI Consulting.
Economic problems in the United States and Europe may be as profound as 2008, he said. “It’s a much more tricky and difficult global situation.’’
But offsetting that, Malloch-Brown said, is the “tremendous addition of domestic demand’’ in Latin America.
With more people entering the middle class and increasing consumption, Latin economies have more of a cushion to sustain themselves during a rough patch.
Indeed, purveyors of luxury goods have found a favorable market in recent years.
Miami-based Porsche Latin America, which has 42 dealerships that cover 26 countries, is expanding and has seen substantial growth in its three biggest markets, Brazil, Mexico and Chile, this year.
Porsche expects to add four or five dealerships in the region in 2012, said Matthias Brück, chief executive of the regional office. It also will enter the Honduran market this year and Bolivia next year.
“Our segment [luxury] has grown faster than the regular car market year to date,’’ he said.
Far and away Porsche’s best seller in Latin America is the Cayenne SUV — despite a staggering price of $389,248 for the Turbo model and $182,872 for the less expensive V6 in Brazil. That includes a recent 30 percent increase in import duties that Brazil imposed on the vehicles.
miamiherald.com
In the past few years, analysts say you could draw a line at Panama and pretty much predict that those economies north of that imaginary boundary were struggling and those to the South were doing well.
With a few exceptions, the analysis that countries more linked to the faltering U.S. economy, such as Mexico and those in Central America and the Caribbean, have shown slower growth and commodity-rich countries whose trade is tied to Asia, especially China, have outpaced their northern neighbors still holds up.
But with jitters about the euro zone crisis spreading, fears that a Greek default may still be in the cards and the possibility of a slowdown in the Chinese economy, questions loom for Latin America and the Caribbean.
“The European crisis will end badly and there will be some impact but not as much’’ as the old days when a global slowdown would push the region into a downward spiral, said Victor Manuel Rocha, former U.S. ambassador to Bolivia and now a senior international business advisor in the Miami office of Foley & Lardner.
“What happens in China is more important to Brazil than what happens in Europe,’’ he said.
Latin America also is better prepared to handle an economic storm than it was in 2008-2009. Not only has the region learned lessons from that crisis, but many countries have built up their international reserves and continued economic reforms.
That’s especially true for countries blessed with iron ore, copper, oil and vast expanses of land for production of the soybeans, wheat and cattle that China buys.
Most of the region’s economies will post respectable economic gains this year, but 2012 could be challenging if global demand slackens and commodity prices fall.
“This time around, China itself looks more likely to suffer a significant slowdown’’ with its own debt and developing manufacturing bottlenecks as contributing factors, said Lord Mark Malloch-Brown, former British minister of state and chairman of the global affairs practice at FTI Consulting.
Economic problems in the United States and Europe may be as profound as 2008, he said. “It’s a much more tricky and difficult global situation.’’
But offsetting that, Malloch-Brown said, is the “tremendous addition of domestic demand’’ in Latin America.
With more people entering the middle class and increasing consumption, Latin economies have more of a cushion to sustain themselves during a rough patch.
Indeed, purveyors of luxury goods have found a favorable market in recent years.
Miami-based Porsche Latin America, which has 42 dealerships that cover 26 countries, is expanding and has seen substantial growth in its three biggest markets, Brazil, Mexico and Chile, this year.
Porsche expects to add four or five dealerships in the region in 2012, said Matthias Brück, chief executive of the regional office. It also will enter the Honduran market this year and Bolivia next year.
“Our segment [luxury] has grown faster than the regular car market year to date,’’ he said.
Far and away Porsche’s best seller in Latin America is the Cayenne SUV — despite a staggering price of $389,248 for the Turbo model and $182,872 for the less expensive V6 in Brazil. That includes a recent 30 percent increase in import duties that Brazil imposed on the vehicles.
miamiherald.com
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