Many companies from Europe and North America first look to Asia, not Latin America, when thinking of their international expansion. Even before that, they pick the ‘low-hanging fruits’ in markets closer to home (e.g. neighbouring EU or NAFTA countries, Eastern Europe – to name a few). Latin America on the other hand usually appears further down on the list of export destinations. And for understandable reasons: the region’s population is much smaller than the one of Asia, yet it includes the majority of the most violent countries in the world; and news of massive corruption scandals in Latin America sadly make frequent headlines in the world press. Not really what international companies and investors look for when scouting for opportunities and new markets!
Still, Latin America offers many opportunities to investors and companies who are not easily deterred by challenging market conditions and are used to look beyond the obvious.
However, to profit from the opportunities that can be found in Latin America, a company needs to have experience in doing business in developing countries with a different culture and language. This challenge is on a whole different level compared to selling your product in the neighboring country that has a similar level of development, per capita income, cultural background and legal system.