Reports are suggesting that in the last 2-3 years Latin America has attracted a lot more attention than usual from the German business community, and is demonstrating a combination of more growth and less volatility in the region.
In 2007 Latin America achieved an impressive economic growth rate of 5.6%, with the combined gross do¬mestic product (GDP) of $3bn equalling the levels of Germany or China. Once again favourable external conditions had contributed to a continuing eco¬nomic boom in the region, while domestic demand had experienced a strong growth, amounting to 7.7%.
Together with an expected growth rate of more than 5% in the present year, at the end of 2008 Latin America will have grown by around 34% in only 5 years.
Exports out of Latin America in¬creased by 12.3% to $753.7bn in 2007, due to the con¬tinuously high worldwide demand for the region’s raw materials and agricultural produce. Its wealth of natural and energy resources and agricultural potential plays an increasingly important role for the region’s position within the world economy. Rising salaries, growing private investment and expanding credit volumes strengthen the region’s domestic economic activity and its boom phase can therefore last for quite a number of years if an unexpectedly strong recession of the world economy can be avoided.
As a result of this, the attractiveness of Latin America as a trade and investment partner continues to grow and remains an attractive trading partner for German companies. Main export goods are machines, vehicles, car components, electro-technical equipment, pharmaceutical and chemical products, optical and measuring devices, plastics, metal and steel products – all or most of which involving industrial gases consumption.
The most striking example of a fresh investment is the huge new ThyssenKrupp steel mill near Rio de Janeiro, Brazil. There is also some German investment in infrastructure, agriculture, tourism, mining (including oil and gas production) and the financial sector.