The Diplomat
76% of Spanish companies plan to increase their investments in Latin America by 2023, which leads to 79% being confident that their turnover in the region will increase in the next three years. This turnover will be higher than in Spain for 51% of large companies and 42% of small and medium-sized companies.
These are some of the conclusions of the fifteenth ‘Report on Spanish Investment in Latin America‘ developed by IE University, Auxadi, LLYC and Iberia, with the collaboration of Casa de América, which was presented yesterday.
“Ibero-American countries are strengthening their attractiveness as a destination for Spanish investment in 2023. If we focus on SMEs, the percentage will be higher than 76%, reaching 81%. Most of these investments will be carried out through organic growth (52%), while 45% will combine organic growth with acquisitions of other companies,” explained the director of the report and professor at IE University, Juan Carlos Martinez Lázaro.
For Luisa García, Partner and Director of Global Operations at LLYC, 2023 is going to be a “very relevant” year for investment in Latin America, taking into account important events such as the XXVIII Summit of Heads of State and Government and the Spanish Presidency of the Council of the European Union. “These are extremely valuable opportunities to put Latin America in the spotlight and to promote business activity in the region,” she said.
For his part, Iberia’s Director of Strategic Alliances and Agreements, Víctor Moneo, said that since the airline began operations in the region, it has always occupied “a central place” in its strategy and in 2023 it is renewing this commitment, strengthening its presence to continue consolidating its “leadership” in connectivity between Latin America and Europe.
Around 70% of Spanish companies believe that the economic situation in Latin America will be similar to that of 2022, and 20% even rate it as good or very good, according to the conclusions of the report.
However, while Panama, Uruguay, the Dominican Republic, Mexico and Colombia have the best ratings, expectations for the economic performance of Chile and Peru for 2023 are slightly down on the previous year. In terms of preferred destinations, Mexico is once again the country where most Spanish companies plan to increase their investments in 2023, followed by Colombia, Chile and Brazil.
Among the risks faced by companies in the region, inflation stands out. In fact, 44% say that it is affecting their level of sales. To a lesser extent, 20% of Spanish companies consider competition from Chinese companies, which are increasingly relevant in these markets.
The report concludes that, at a time of geopolitical tensions and increasing protectionist practices in some countries and regions, Spanish companies value the opportunities offered by the region (79%) above the European Union (67%), the United States and Canada (67%) and Asia (32%).
In this regard, the CEO of Auxadi, Víctor Salamanca, pointed out that Latin America is “an attractive market” for Spanish companies. “Auxadi has been supporting Spanish companies in their global expansion for more than 40 years, especially in Latin America, a huge and interconnected market that offers great opportunities. To distribute, to produce and to create”, he said.
