Transcript Slide 1
Latin America: Argentina & Brazil Past, Present & Future Latin America 10,000 Km = Nagoya to Paris One Subcontinent • • • • • • • • 562 million people 20 Countries U$ 3.3 trillion GDP Spanish, Portuguese, French languages Resource rich (oil, land, water, minerals) Under colonial rule from XVI to XIX century Indians, Europeans, Africans, Asians (Chinese and Japanese) Brazil & Peru: largest nikkei communities in the world Differences • • • • • • Colonial history People Culture Political regimes Economic structure Soccer skills! Latin America Today General Scenario • Democracy (more than 10-20 years) • Market economies (except socialism oriented Cuba & Venezuela) • (Post Import Substitution) trade openness Economy • Steady growth (4.55% in 2006, 4.23% in 2007) • Inflation under control (4.2% in 2006,but 14.1% in 2007) • (Official) Unemployment still high (9.1% in 2004) • Exports (main partners: US, China, Europe) – Industrial components (e.g. Mexico, Brazil) – Commodities (e.g. Chile, Argentina) Brazil Facts • Population: 189.3 million • Area: 8,514,877 km² (5th) • GDP per capita (PPP): U$ 9,700 • Federative Republic: 26 states, 1 FD • President: Luiz Inacio Lula da Silva (since 2003) Economic Facts • Interest rate: 12 % • Gini coefficient (UN): 0.57 • HDI: 0.800 • WB Doing Business Rank: 122nd (113 in 2007) • GDP growth: 4.3% in 2007 (4.1% in 2006) Pending issues • Red Tape harnessing private sector • Politicization of regulatory agencies’ and state companies’ • Adequate Protection of the Environment Overcome issues Field Ranking Ease of Doing Business 122 Starting a Business 122 Dealing with Licenses • Political / Macroeconomic predictability Employing Workers • Public Foreign Debt Registering Property • Public Policy to Redistribute Income Getting Credit 107 119 110 84 Protecting Investors 64 Paying Taxes 137 Trading Across Borders 93 Enforcing Contracts 106 Closing a Business 131 Argentina Facts • Population: 39.4 million • Area: 2,766,890 km² (8th) • GDP per capita (PPP): U$ 13,307 • Federative Republic: 24 provinces • President: Cristina Fernández de Kirchner (since 2007) Economic Facts • Interest rate: 11.1 % • Gini coefficient (UN): 0.49 • HDI: 0.869 • WB Doing Business Rank: 109 (101 in 2007) • GDP growth: 9.1% in 2007 (8.2% in 2006) Pending issues • • • • Predictability and coherent policies Inflation ghost Growing inequality + growing insecurity Corruption + Regulatory burden Overcome issues • Political past • Debt restructuring (still some not paid debt) • Environment as political objective Challenges • Stark income inequality • Heritages of protectionist, state-led industrialization • Poor quality, lacking infrastructure • Poor industry regulation • Rigid, heavily charged labor market LA challenges and our hopes