There is no doubt that the economic balance of the worldwide economy has moved over the last five or six years after the U.S.-led credit crunch which resulted in a worldwide recession part one, part two and part three?
As a consequence Central/South American countries, led by Brazil, are now amongst the strongest economies in the world and their presence on the worldwide stage is growing. There are very close similarities between the ongoing developments within Latin America and the development of Europe in years gone by as one of the leading powerhouses.
European companies flocking to Latin America
In the 1990s the likes of Brazil and Argentina were on the verge of economic collapse and labelled as “basket cases” by many leading economist. There was talk of decade-long recessions, a reduction in the standard of living, a reduction in the number of expats and a reduction in investment in the region. To all intents and purposes Latin America had been written off by many companies, many governments and many economist. How wrong they were!
Over the last few months we have seen a significant increase in the number of European countries looking to invest in Latin/South America. This on top of ongoing North American investment in the region has led to significant economic growth which looks even better compared against the ongoing worldwide difficulties. This investment in the region is set to continue in the short to medium term, and potentially longer term, amid signs that the euro could be in the doldrums for many years to come.
Expats look to Latin America
The number of expats moving to Latin/South America has grown significantly since the worldwide recession, much of which was avoided by Latin America and Australasia, and this is set to continue for the foreseeable future. It is the standard of living, the growing economy, the prosperity of the region and the fact that there are opportunities aplenty for those looking to settle into a new life. The influx of expats into countries such as Brazil, Mexico, etc has actually picked up in pace rather than subsided over the recent months which has surprised many people.
The growing number of expats in Latin America will obviously attract more and more people to the region, lead to increased demand for services and retail products and also help to stabilise government finances across the board. This is effectively a win-win situation.
Comparisons with Europe of years gone by
Europe has not always been the financial powerhouse which it was before the Euro collapse. Indeed there are some similarities between the 1990 collapse of the likes of Brazil and Argentina, which technically defaulted on their debt, but were bailed out by the IMF. Perhaps we are seeing history repeating itself with the emergence of Latin America as the new economy of the new-age while Europe and North America continue to struggle.
Financially Latin America is streets ahead of Europe at this moment in time and indeed the volatile US economy is also strengthening the position of Latin America.
It is no surprise to see that more and more expats are looking to move to Latin America when you bear in mind the ongoing economic prosperity of the region. We have the likes of Brazil leading the way in the region and also causing significant waves on the worldwide scene. We have Mexico bringing in a new political era, tackling the drug barons and assisting an economy which has been growing for some time. These situations are replicated time and time again across Latin America and at this moment in time the region will emerge from the ongoing worldwide economic downturn as a significant force.