Thank you for visiting our “Top 5 Delivered by DHL” series. It’s a fast and informative way to help you learn more about global topics that affect your business. Below, we’re delivering insights about the markets of Chile, Peru and Colombia. Look for more about Going Global, TPP, Cuba, Brazil, Avoiding Import Delays, NAFTA, International Business Travel and Global E-Commerce on our YouTube playlist.
Today, U.S. businesses are increasingly turning to South America to deploy or expand their exporting strategies. While Brazil remains a key market for investment and trade, Chile, Peru and Colombia offer critical opportunities that growing businesses should certainly explore. According to the Office of the United States Trade Representative, Colombia was the 20th largest goods export market for U.S. businesses in 2015, with a total of $17 billion in exports from U.S. shores. Chile ranked 22nd, with $16 billion in exports, and Peru ranked 30th, with almost $9 billion in exports.
If you want your business to leverage the opportunities these impressive statistics represent, here are five things to consider as you develop your strategy:
1. The market is heating up
Businesses with an eye on importing and exporting in Latin America are turning their focus to the rising economic powerhouses of Chile, Peru and Colombia. Although they once experienced tumultuous periods of boom and bust, in the last decade these countries have steadily established strong macroeconomic conditions with firm GDP growth, low inflation, controlled deficits and solid central banks. They have also embraced the free market and positioned themselves as global exporters – implementing business-friendly policies mainly directed at North and South America, as well as the commodity-hungry China.
2. The opportunities in Colombia
In Colombia, exporters can look to reach a population of almost 50 million potential customers. The country’s imports are led by refined petroleum and cars. In 2015, U.S. exports of agricultural products reached $2.4 billion. Some of the country’s fastest growing imports include tobacco, railway/tram equipment and beverages.
3. The opportunities in Peru
In Peru, with a population of about 30 million, prospects are bright. Aggressive structural reforms in the commercial and financial areas have helped solidify the country’s economic foundation. The country should see increased activity in areas including financial services and electricity. The United States-Peru Free Trade Agreement has removed tariffs, and it provides security and predictability for U.S. investors and exporters.
4. The opportunities in Chile
With the steadiest track record of the three, Chile offers strong commodities-based opportunities along with a growing retail sector and niche industries, such as wine production. Chile has been transformed from one of the region’s poorest countries into one of its richest, and successive governments have used the proceeds from copper exports for a sovereign wealth fund. The economy has expanded, production has increased and the unemployment rate has tumbled. While the mining sector continues to be a cornerstone, the construction, commerce, communications and financial services sectors have all shown dynamic growth – leading to new trade possibilities.
5. Chile and Peru are part of the TPP agreement
Chile and Peru will be part of the 12 economies involved in the Trans-Pacific Partnership trade agreement, helping boost their access to the U.S. markets, while making it easier for U.S. businesses to reach new audiences within their borders. The two countries are also members of the Asia Pacific Economic Cooperation, which sets standards for trade and commerce between its member economies.
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