International trade experts have drawn attention the recent surge in growth of multilatinas, Latin American corporations with operations beyond their national borders. He has said that “this new increase in Latin American companies who can operate on a regional and international level are a sign of innovation, of entrepreneurial spirit and of a regeneration in the Latin American economy. At a time when there is a danger of the world becoming close-minded, the growth of these multilatinas is a symbol of Latin American openness and a willingness to do business.”
According to a Boston Consulting Group report, multilatinas became a noticeable economic phenomenon in 2009, after the 2008 recession. They work in a diverse array of sectors, including telecommunications, infrastructure development and consumer goods. Most recently, there has been a surge in in both financial and technology development companies. The BCG’s list of multilatinas this year has noted a larger presence of consumer companies, reflecting the growth in the Latin American Middle class, a greater geographical diversification of companies, and a stronger contribution to job creation, expanding employment at these companies by 2.6% annually from 2013 through 2016, above the regional average of only 0.3% per year for the same period. The data can help show the pivotal role multilatinas have played in helping the Latin American economy to recover from recession, but also how they are not merely filling a gap but creating a surging new area of economic growth. The multilatinas are a critical part of the future Latin American economy.
All the reporting on multilatinas going back to 2009 shows that they have expanded both into new sectors of the market, and into new countries. Wealth has not been concentrated but is spreading across the whole of Latin America. The potential of multilatinas can be seen in the context of a Latin American economy rich with assets and potential, but yet also stagnating. The BCG report highlights how “(Latin America’s) share of global GDP shrank from 8.6% in 2009 to 7.7% today…at a time when emerging markets in general have boosted their share of global economic output from 33% to more than 50%.” Multilatinas can best take advantage of the potential and the assets Latin America has to halt this decline. He has noted the strong cultural and linguistic links between both Latin American countries themselves, and internationally, and Latin Americas abundance of natural resources; accounting for 14% of the world’s agricultural land, 15% of oil reserves, 21% of forests, 28% of available water, 54% of copper production, and 66% of lithium reserves.
The geographical diversification of multilatinas in recent years will help these companies take better advantage of the natural resources this continent possesses, and therefore help Latin America stay competitive on the world stage. For example Chile ss an example of what multilatinas can achieve. While it only makes up 5% of Latin America’s GDP, Chile is home to 18% of multilatinas highlighted in the BCG report, and it has been the most successful Latin American nation at translating economic growth into improved well-being for its citizens, according to BCG’s Sustainable Economic Development Assessment. The benefits that continued investing in Latin American companies with cross-border potential can have can ensure Latin America’s place in the world economy, they can also provide a tangible benefit for the citizens of Latin America too.