Taking advantage of Latin America’s market downturn

Latin America’s economic growth has been on the decline for several years, with a 2.5% projected regional contraction in 2019. Though the recent economic downturn has had negative repercussions for businesses, families, and individuals across the region, it presents a unique opportunity for certain industries and those with the resources to capitalize.

The current downturn has been partially caused by drops in the prices of commodities, including oil, copper and iron ore. Global trade tensions, anemic domestic consumption, and continuing political unrest have also contributed. However, low commodity prices offer the potential for a host of opportunities. Companies in other sectors—including financial service providers, telecoms, healthcare, and consumer staples—can take advantage of the market downturn by buying into the region with lower price points. As a result, businesses can grow their customer base and increase profits due to increased competition.

In addition, the current circumstances have created favorable conditions for foreign direct investment (FDI). An influx of FDI could help to stimulate Latin America’s economies, creating new jobs, technology, and other economic benefits. Investors can capitalize on the lower-cost environment by acquiring real estate, companies, and other assets for significantly lowered prices.

In the long-term, the economic downturn may provide an opportunity to restructure the region’s economies to create more sustainable growth. Latin American governments are creating more favorable conditions for investment by enacting reforms, including improved access to financing, lower taxes and regulations, and improved infrastructure. By taking these steps, governments can make their economies more competitive and encourage foreign investors to tap into the region’s potential.

Despite the current market downturn, Latin America still has great potential. Although times are certainly tough, the market downturn creates opportunities for those with the resources to capitalize. With the right strategies, companies and individuals can take advantage of this situation to build a more profitable, sustainable future in the region.