Transcript Presentation by Andrew Wright, Director Colombia at UK Colombia

LATIN AMERICA
Region of Contrasts &
Opportunities
International Festival of Business
15th July, 2014
#IFB2014 #LatAm
LatAm Macro
Overview
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LatAm Overview: Opportunities
• The UK traditionally has strong links with Latin America (in 1808, 40% of UK
exports went to LatAm!), but these links weakened in the 20th Century
• Other European countries trade much more with LatAm (Germany trades 4 times
more than the UK with LatAm)
• This indicates huge potential to grow trade with LatAm. Both the private & public
sector have now realised this and are pushing for increase in trade
• Several of the most-watched emerging markets are in LatAm (Brazil from BRICS,
Mexico from MINT, Colombia from CIVETS)
• Regional GDP growth of 3% in 2013 (source: ELAC)
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The Region
19 countries
1 in North America
2 in the Caribbean
6 in Central America
10 in South America
21 million square kms or
14.1% of the earth's
surface
GDP US$ 5.6 trillion in
2012
Population of 589 million
Per capita Gross National
Income US$ 9,070
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(Source World Bank/ECLAC)
Macro snapshot
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Pro-Mexico Video
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The Power of the
Pacific Alliance
What is it and why?
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An ocean of opportunities…
• Combined market of over 200
million consumers
• Over half of LatAm Global Trade
• Depth & Breadth of FTA’s provide
platform for growth with USA &
Asia
• Main sectors
 Natural resources
 Financial & Bus. Services
 Software & IT services
 BPO
 Food & Drink
 Consumer goods
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Ease of doing business & market access
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FCO LatAm Economic Indicators Index
Improving
Business
Environment
PACIFIC
ALLIANCE
10
Colombia
9
Barbados
Chile
Mexico
This chart uses an average of
indicators to compare how the
countries in the LAC region score
in terms of their business
environment and market
potential. The size of the bubble
represents the expected increase
in value in each countries import
market 2013-2020.
Uruguay
Peru
Costa Rica
Panama
8
7
Jamaica
El Salvador
6
CENTRAL
AMERICA
5
Guatemala
Trin & Tobago
Brazil
Argentina
Dom Rep
St Lucia
Nicaragua
Honduras
Guyana
Dominica
St Vincents
Ecuador
Paraguay
Bolivia
Bahamas
Surinam
This may under-estimate
investment opportunities in
larger economies like Brazil or
open Caribbean islands, but
which may also be driven by the
countries’ business environment.
MERCOSUR
4
Grenada
Belize
3
CARRIBBEAN
2
Venezuela
Haiti
Antigua
St Kitts
1
0
0
1
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2
3
4
5
OFFICIAL
6
7
8
10
9
Improving
Growth
10 Outlook
Why Colombia?
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Regional
Opportunities
Case studies of Success
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Colombia: Regional economic sectors
Caribbean
Region
• Caribbean: tourism, logistics, petrochemicals,
construction materials, import/export platform to
the Caribbean/Atlantic.
Infrastructure
& Transport
Central / Andean
Region
• Central/Andean: services, high value-added
manufacturing, hub to cover domestic market,
specialized agroindustry.
Oil & Gas
Pacific
Region
Orinoquía
Region • Pacific: manufacturing, agroindustry, logistics,
biotechnology, export platform to the Pacific Rim.
Retail
Financial &
Professional
Services
UK Opportunities
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Amazon
Region
• Orinoquia: agriculture, forestry, biofuels,
hydrocarbons.
• Amazon: conservation, ecotourism (Leticia).
Colombia Case Study
Sector:
Supermarket Retail
Company:
Waitrose is a chain of British supermarkets, forming the food retail division
of Britain's largest employee-owned retailer, the John Lewis Partnership.
Support provided:
•
•
•
•
Outcome:
Market and sector analysis and list of the potential distribution
partners
Market visit support
Help to set up client meetings
Follow-up on negotiations and in-market support
Advanced distribution partner negotiations close to fruition.
Next stage is to confirm SKU’s.
“UKCT gave first class support to me before, during and after the trip. They had an
excellent insight into the markets and connected me with the right people in the
right places, which was invaluable.“
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"quality you'd expect
at prices you
wouldn't"
Mexico: Regional Economic Sectors
Aerospace
& Automotive
Aerospace & Automotive
With an average 20% annual growth rate since
2004, Mexico has become a global leader in
aerospace sector, boasting 270 companies and
supporting entities
Oil & Gas
Retail
Healthcare and Life Sciences
The Federal Commission for
Protection Against Sanitary Risk
has been working hard to reduce
the barriers to entry for new
medicines entering the country.
Demand for services & products is
high
Healthcare &
Life Sciences
Retail
Growing middle class drive demand for
consumer electronics, clothing and
household goods
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Oil and Gas
Mexican production at almost 2.5 Million
barrels per day
Last year’s Energy Reform and secondary
allow for private investment
Chile: Regional Economic Sectors
Mining
Fishing
Agriculture
Antofagasta
16% of GDP
Manufacturing
Services
75% of GDP
Agriculture
Cattle Breeding
11% of GDP
Santiago
49% of GDP
Concepción
7% of GDP
9% of
GDP
Forestry
Fishing
Agriculture
Mining
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• North (Atacama Desert): mining, mainly copper of
which Chile is the world’s largest producer. Also
Lithium and Molybdenum. Related Energy and Water.
The climate is similar to Northern Africa.
• Central Valley, with capital Santiago and Valparaíso
(port and seat of Congress): Renewable Energy,
Infrastructure, mining, manufacturing, agriculture,
wine, agribusiness,, retail and financial services. The
climate is similar to Madrid and Rome
• South: Renewable Energy, forestry, salmon farming,
fishing,
agriculture
and,
in
Concepción,
petrochemicals and steel production. This region is
rainy and similar to the UK.
• Fjords and Tierra del Fuego: tourism, agriculture,
aquaculture, fishing, gas and oil production, coal
mining, wood pulp & board. This sector is snowy and
windy, very similar to Scandinavia.
Chile Case Study
Sector:
Health
Company:
BioEden, the World’s First banking service for dental stem cells. Now they
serves Members in over 60 countries, with storage lab facilities in the UK,
the USA and Asia.
Support provided:
•
•
•
•
•
Outcome:
Develop BioEden business model based on a franchise. Encourage the use
of Tooth Stem Cells among people through dentists to promote the
solution.
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Product launching at the HM Ambassador Residence
Complete market assessment
Tailored advice on Chilean consumer consumption behavior and trends
Comprehensive list of contact
Developing meeting
"…building an organ
that is a match for
you, is available for
you, is something
that wasn’t even
fathomable ten or 15
years ago…"
Growing LatAm Presence of UK Brands
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Recommendations
• Latin America has a wide mix of business opportunities for UK plc:
• Vast divergence in market size and business environments across countries and country groups (e.g.
Mercosur, Pacific Alliance, the Caribbean and Central America).
• We must look at different ways to maximise UK opportunities in different markets and regions, even
within markets.
• Brazil remains the number one prospect in terms of market size and growth potential, but its
business environment remains weak:
• Its size means continued opportunities for exports and investment, but low competitiveness, high
protectionism and corruption could hinder UK success.
• BUT Pacific Alliance countries provide the best balance of opportunities in terms of both growth
outlook and ease of doing business.
• Encouraging businesses in key sectors could bring quicker wins in these economies than in other
markets.
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