Latin America-The Big 'B' of BRIC
Latin America consists of 20 countries. It has a population of 550 million and GDP of 4 trillion dollars ( 2009- ECLAC estimate ). Total trade
in 2009 1.4 trillion dollars of which exports were 750 billion dollars and imports US$ 650 billion. It is expected to grow to a market value of
USD63 billion at retail prices by 2012.
Key countries with highest potential for industrial growth are:
Argentina benefits from rich natural resources, a highly literate population, an export-oriented agricultural sector, and a diversified industrial
base. Although one of the world's wealthiest countries 100 years ago, Argentina suffered during most of the 20th century from recurring
economic crises, persistent fiscal and current account deficits, high inflation, mounting external debt, and capital flight.
Characterized by large and well-developed agricultural, mining, manufacturing, and service sectors, Brazil's economy outweighs that of all
other South American countries and Brazil is expanding its presence in world markets. Since 2003, Brazil has steadily improved
macroeconomic stability, building up foreign reserves, reducing its debt profile by shifting its debt burden toward real denominated and
domestically held instruments, adhering to an inflation target, and committing to fiscal responsibility. In 2008, Brazil became a net external
creditor and two ratings agencies awarded investment grade status to its debt. After record growth in 2007 and 2008, the onset of the global
financial crisis hit Brazil in September 2008.
Chile has a market-oriented economy characterized by a high level of foreign trade and a reputation for strong financial institutions and sound
policy that have given it the strongest sovereign bond rating in South America. Exports account for more than one-fourth of GDP, with
commodities making up some three-quarters of total exports.
Mexico has a free market economy in the trillion dollar class. It contains a mixture of modern and outmoded industry and agriculture, increasingly dominated by the private sector. Recent administrations have expanded competition in seaports, railroads, telecommunications,
electricity generation, natural gas distribution, and airports.
Peru's economy reflects its varied geography - an arid coastal region, the Andes further inland, and tropical lands bordering Colombia and
Brazil. Abundant mineral resources are found in the mountainous areas, and Peru's coastal waters provide excellent fishing grounds. The
Peruvian economy grew by more than 4% per year during the period 2002-06, with a stable exchange rate and low inflation.
Growth jumped to 9% per year in 2007 and 2008, driven by higher world prices for minerals and metals and the government's aggressive trade
liberalization strategies, but then fell to less than 1% in 2009 in the face of the world recession and lower commodity export prices.
Venezuela remains highly dependent on oil revenues, which account for roughly 90% of export earnings, about 50% of the federal budget
revenues, and around 30% of GDP. Fueled by high oil prices, record government spending helped to boost GDP by about 10% in 2006, 8% in
2007, and nearly 5% in 2008, before the world recession caused a contraction in 2009.