76% of Spanish companies plan to increase their investments in Latin America in 2023, which leads to 79% being confident that their turnover in the region will increase in the next three years, reaching a higher weight than Spain for 51% of large companies and 42% of small and medium-sized ones.
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.
“Ibero-American countries reinforce their attractiveness as a destination for Spanish investments 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 do so by combining organic growth with acquisitions of other companies”, explained the director of the report and professor at IE University, Juan Carlos Martinez Lázaro.
For LLYC’s partner and director of Global Operations, Luisa García, 2023 will be a “very relevant” year for investment in Latin America, taking into account prominent events such as the XXVIII Summit of Heads of State and Government or the Presidency of the Spanish Council of the European Union. “They represent great value opportunities to put Latin America in the spotlight and promote business activity in the region,” he stated.
For his part, the director of Alliances and Strategic Agreements of Iberia, Víctor Moneo, has assured that since the beginning of the airline’s operations in the region, it has always occupied “a central space” in its strategy and in 2023 it is renewing this bet, strengthening its presence to continue consolidating its “leadership” in the connectivity between Latin America and Europe.
Good economic situation in Latin America
Around 70 % of Spanish companies believe that the economic situation in Latin America will be similar to that of 2022, even 20 % rate it as good or very good, according to the report’s conclusions.
All in all, while Panama, Uruguay, the Dominican Republic, Mexico and Colombia reach the best valuation, expectations for the economic performance of Chile and Peru for 2023 fall slightly compared to the previous year. Regarding the preferred destinations, Mexico is once again the country in which the most Spanish companies are thinking of increasing their investments during 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 the competition from Chinese companies, increasingly relevant in those markets.
The report concludes that at a time of geopolitical tensions and an increase in protectionist practices in some countries and regions, Spanish companies value the opportunities offered by the region (79 %) over the European Union (67 %), the United States and Canada. (67 %) or Asia (32 %).
In this sense, the CEO of Auxadi, Víctor Salamanca, pointed out that Latin America is “an attractive market” for Spanish companies. “At Auxadi we have 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 has reviewed.
(Reference image source: IE University, Europa Press)
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