Business Opportunities in Latin America

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By Ariel Dess

With the recent economic crisis, companies all over the world have experienced a decrease in sales or very slow growth rates. This has forced businesses to stop relying on classic markets such Asia, Europe and the United States and start looking to expand their distribution channels in other regions. Latin America is on top on their list.

Information about Latin America

Latin America is made up of the following countries: Brazil, Mexico, Argentina, Colombia, Chile, Peru, Venezuela, Guatemala, Ecuador, Costa Rica, Cuba, Uruguay, El Salvador, Paraguay, Bolivia, Panama, Honduras, Nicaragua, Guyana, Suriname, Netherlands Antilles and Belize.

Spanish is the most widely spoken language in the region. Portuguese is the official language in Brazil which is the most powerful economy in Latin America. In general, the business community speaks English.

The population in Latin America is 569 million people approximately. This is an ideal market to develop since the region has been experiencing stable democracies and increased disposable consumer income.

What are the advantages of doing business in Latin America

1. Low labor cost

The labor costs are still very low compared to wages in more developed countries. This allows for smaller companies to start with lower overhead expenses.

2. Tax incentives

Some countries, such as Panama, have pursued special programs to attract foreign companies by attributing low tax rates to foreign companies willing to invest in the country. This has been a successful strategies which has been adapted by other countries in the region.

3. Cost of living is lower

You can pretty much set up offices at a fraction of the price you would pay elsewhere. Food, real estate, health are much less expensive allowing your to have a very good standard of living.

4. Presence of tax free zones

This is one of the most important trading platforms in the region. The most important thing about these zones is that companies pay very little duty on the products they are importing and exporting. This allows their profits to be higher.

The advantages stated above allows international companies to pursue this market with much lower risks.

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