Alem Tedeneke, Media Manager, World Economic Forum; Tel.: +1 646 204 9191, +52 55 6608 7317; Email: ated@weforum.org
Riviera Maya, Mexico, 7 May 2015 – While the evolving global context is more challenging, Latin America is poised to take advantage of continuing opportunities for growth. This is according to business and government leaders, speaking in a World Economic Forum on Latin America session focusing on how economic and political shifts are shaping the region’s future.
“Latin America saw a period of over a decade with good winds to our sails,” explained Luis Alberto Moreno, President of the Inter-American Development Bank in Washington DC. But the commodity super cycle has ended and the economic slowdown in China is contributing to slower demand for raw materials and natural resources, reducing the region’s growth prospects. China is shifting its economic model to pursue more balanced, sustainable growth, noted Tim Groser, Minister of Trade and Minister of Climate Change Issues of New Zealand. “The shift in the development model of China will have far more important effects than the lower growth rate.”
“There are a lot of headwinds today,” agreed John Santa Maria Otazua, Chief Executive Officer of Coca-Cola Femsa in Mexico. “But the end of a cycle is also the beginning of a new one.” Manuel A. González Sanz, Minister of Foreign Affairs of Costa Rica, told participants that China will be a major investor in Latin America over the next decade. The deceleration of the Chinese economy will not be serious enough to prevent Latin America from continuing to benefit from China’s rise, he argued.
Moreno reckoned that Latin American economies such as Mexico that are closely linked to the United States will benefit from the strengthening recovery of the US economy. The quantitative easing by the European Central Bank has opened the door for Latin American countries to issue euro-denominated bonds. Latin American countries are well placed to take advantage of the fast pace of technological developments, such as robotics, to enhance productivity, Moreno proposed.
Santa Maria Otazua, meanwhile, said that countries in the region that continue to implement reforms that drive growth and get more people into the workplace will be attractive destinations for investment. His company is particularly bullish on Mexico and Colombia, he told participants.
Latin America is also becoming more deeply integrated into the global economy and engaged in global affairs, Thomas A. Shannon Jr, Counsellor of the US Department of State, pointed out. The Trans-Pacific Partnership (TPP) free-trade arrangement that is currently under negotiation could eventually link countries in the Pacific Alliance – Chile, Colombia, Mexico and Peru – with East Asian economies. “This is how we are building the connectivity that uses markets not just to create wealth but to address issues like financial inclusion,” Shannon said. Latin America’s relations with other regions are “increasingly not being defined by governments but by relations among people.” Latin America is contributing to international efforts this year to set out Sustainable Development Goals and to agree on a new global framework to address global warming.
More than 750 participants are taking part in the 10th World Economic Forum on Latin America in Riviera Maya, Mexico from 6 to 8 May 2015. The theme of the meeting is “Advancing through a Renovation Agenda”.
The Co-Chairs of the World Economic on Latin America are: Carlos Brito, Chief Executive Officer, Anheuser-Bush InBev, USA; Carlos Slim Domit, Chairman, América Movil, Mexico; Angelica Fuentes, President of Angelica Fuentes Foundation, Mexico; Eduardo Leite, Chairman of the Executive Committee, Baker & McKenzie, USA; Ignacio Sánchez-Galán, Chairman and Chief Executive Officer, Iberdrola, Spain; and Joseph E. Stiglitz, Professor, School of International and Public Affairs, Columbia University, USA.
Notes to Editors
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