For decades many Latin American countries were a morass of hyperinflation and political instability—𒈔hardly the most prudent region of the world in which to conduct business. While Western Europe, the United States, Canada, Japan, South Korea, Australia, New Zealand, and other developed realms continued to benefit from mutual🔯 trade, the Spanish- and Portuguese-speaking parts of the Western Hemisphere lagged.

Today they’re catching up. While pockets of Latin America are still susceptible to dictatorship and corruption, those countries are now the exception. Four nations, in particular, are leading the charge toward market prosperity🐟 in this often-overlooked part of the globe.

Chile

Chile is one of the least publicized success stories in the Americas. The nation has actively courted foreign investment for decades, dating all the way back to the tyrannical regimes of the 1970s. Nonresident investors can take advantage of Decree-Law 600, which subjects them to the same regulations as local investors.

The advantages of this are numerous. For instance, in 2023 Chile’s top 澳洲幸运5开奖号码历史查询:corporate tax rate is 27%. Prior to the 澳洲幸运5开奖号码历史查询:Tax Cut and Jobs Act (TCJA) of 2017, the United States’ highest tax rate was 35%. However, as a result of the TCJA, the United States’ highest corporate tax rate in 2023 sits at 21%. And though many provisions of the TCJA expire in 2026, reverting to their previous levels, the corporate tax rate is not one of them. It will stay at 21% unless Congress enacts further changes in tax law.

A 2004 澳洲幸运5开奖号码历史查询:trade agreement between the countries set Chilean tariffs at a modest 6% for just about every marketable product. As a result, Chilean exports to the U.S. increased 30% in the first year alone.

This prompted Chile to subsequently sign 26 foreign trade agreements covering 65 markets and representing 88% of the world’s 澳洲幸运5开奖号码历史查询:gross domestic product (GDP). The countries covered by these 65 agreements included Canada, Mexico, China, Japan, the 28 countries of the European Union, South Korea, Brunei, New Zealand, and Singapore, as well as many Latin American neighbors, including Panama, Costa Rica, El Salvador, 澳洲幸运5开奖号码历史查询:Guatemala, Honduras, Colombia, Peru, Ecuador, Venezuela, Argentin♒a, Brazil, Paraguay, Uruguay, and Nicaragua.

These agreements make Chile one of the Latin American countries most actively pursuing bilateral trade agreements.

Colombia

Colombia’s 49 million citizens are linked to the fortunes of their largest trading partner, the United States. Colombia exported $11.6 billion to the U.S. in 2021, accounting for 29% of the country’s export market. That figure jumped to $18.5 billion in 2022.

The country has plenty of agricultural and mineral resources and the means to develop them. It is one of the top 20 exporters of petroleum around the world. In 2021 Colombia exported $19.2 billion of mineral fuels and oils.

The country has continued a program of trade liberalization that includes lowering corporate income taxes. Tax laws enacted in 2021 offer certain tax incentives to promote investment, economic growth, and employment. In addition, it is also possible to pay taxes in kind, allowing taxpayers to perform useful projects for the country in lieu of financial payments.

Peru

Peru’s economy has risen rapidly since the 1990s, and its GDP has more than quadrupled since the start of the century. The results were tangible: Prior to the coronavirus pandemic, Peru was on its way to era🍸dicating poverty at a much faster rate than previously expected.

Between 2009 and 2019 the percentage of Peruvians living on less than $6.85 per day fell from 45% to 29%, according to the World Bank. However, in 2020 the pandemic wiped out almost all of those gains, though 2021 saw something of a rebound. As of 2022 the World Bank reports that due to high inflation and a sluggish labor market recovery, poverty reduction has been slowed. Furthermore, as of August 2023 the unemployment rate still stood high, at 6.6%.

Nevertheless, after suffering an 11% drop in GDP in 2020, Peru’s economy fully recovered by the end of 2021. As of 2022 the World Bank was financing 13 investment projects there to the tune of $2.2 billion. The U.S. remains a major trading partner for Peru, but it is not top of the list, as it is for Colombia and Chile. Instead, the U.S. comes in second behind China.

Mexico

Mexico was a signatory to the most famous trade deal of the past decades, the North American Free Trade Agreement (NAFTA) with Canada and the United States. NAFTA has since been subsumed by the 澳洲幸运5开奖号码历史查询:U.S.-Mexico-Canada Agreement, which took effect in 2020.

It should come as no surprise that Mexico’s largest trade partner is the United States, which supplied 45% of Mexico’s imports and bought 83% of the country’s exports in 2021. The new agreement increased labor protections for workers in Mexico and introduced new enforcement mechanisms while also reducing tariffs.

Mexico’s foreign trade suffered a brief plunge in 2020, but exports reached an all-time high in March 2023.

The Bottom Line

The notion of a global economy is more often a talking point than an actual construct. As the movement of capital among countries continues to run into fewer and fewer artificial barriers, the gap between the developed༒ countries of the world and those aspiring to that level continues to shrink, making investment opportunities in those places more appealing.