Last week at BNR News Radio 📻

How to run your company with international risks that have an impact on your business? 💰

TRANSFERs CEO, Gerald Baal explains political, financial and other risks that may apply while doing business in countries like Argentina, Brazilian, Colombia, Mexico, and Venezuela. 💼

Also, Kees Huizinga, who has run a company with 300 employees since 20 years in Ukraine, shares his brave experiences about how to run a business during wartime. 📈

🇦🇷 Argentina: The new and aggressive methodology to improve 

Since 2023, President Javier Milei new aggressive and disruptive approach focuses on the reactivation of ARG economy ⚖️

📊Economic Indicators 

• There has been a 66% increase in GDP from 2020 to 2024 (Argentina is 22nd in world ranking) 
• New rules for Imports and Exports have been put into place to promote more trade with the use of the SEDI (Import Statistical system)  
• Inflation rates hits an all-time high at 254.2% 
• Milei’s plans have not yet brought the stability that was promised.

📢Public reaction 

• Even though ARG faces tough economic challenges, the majority of the population believes in the process 
• Milei hopes the Argentinian people hold on during these hardships to enjoy a more stable economic future
• Discontent is a growing crisis in ARG
  • General strikes and protest are more regular 
  • Poverty has increased by 15%
  • Labor organizations have strong resistance toward the public discomfort 

🇻🇪 Venezuela: Navigating Political and Economic Turbulence

Despite recent improvements in GDP growth, Venezuela’s economic and political situation remains precarious. Businesses and investors should approach with caution and develop robust strategies to navigate this volatile market 📈.

🏛️ Political Landscape:

• Nicolás Maduro in power since 2013
• Regime characterized as authoritarian
• Controversial 2024 election, with opposition claims of victory

🤝 Key Allies:

• Russia: Political and financial support
• China: Major lender (though cautious due to default risks)
• Cuba: Security support

📊 Economic Indicators:

• GDP Ranking: 64th globally, 10th in LATAM
• GDP Growth:

2020: -30%
2022: 15%
2024 (forecast): 4.8%

• Inflation rates: 
  2019: 344,509.50% (Peak) 🚀
  2023: 193%
  2024: 230% (forecast) 📈

💡 Strategies for lowering hyperinflation:

• Widespread use of US dollars
• Adoption of cryptocurrencies
• Informal market participation

🇧🇷 Brazil: A Beacon of Economic Stability in South America 

Brazil stands out as a relatively stable economy in South America, providing a secure environment for international business and investment. Here’s why Brazil is worth your attention! 👇


📊 Economic Indicators

• Inflation Rate: Currently at 4.5%, Brazil’s inflation is significantly lower than that of its regional peers.
• Brazil’s inflation rate is lower than several other major Latin American economies, indicating relatively better price stability in the region.
• Market Size: With the largest population in South America, Brazil offers a substantial consumer market, enhancing its economic strength.

🏛️ Political Situation

Brazil faces its own set of political challenges and debates, understanding these dynamics is essential for businesses aiming to thrive in this market.

⚠️ Economic Challenges

Despite its strong position in LATAM, Brazil still encounters economic hurdles. Common issues in emerging markets, such as:

• Income Inequality
• Infrastructure Needs
• Balancing Growth with Environmental Concerns

These challenges require strategic planning and adaptation for businesses operating in the region.

🇨🇴 Colombia: Vibrant Force with new struggles 🌐

Colombia economic thrive is slowing down due to high inflation, but it still maintains its status as the fourth-largest influence in Latin-American economies. This is due to their various resources and powerful industries. 👇

📊Economic Indicators

• GDP: There has been a 35% increase from 2020-2023
• Inflation Rate: Forecasted to decrease to a 5.4% by the end of the year  
• Unemployment rate: 9.41% with a grand majority of the population working informal jobs

🏛️ Political situation 

• Gustavo Petro’s leftist campaign started during 2022
• His approval rate has dropped and has a minority in congress
• High focus on education, health care, lower inflation and improve economic growth
• Public debt has become a major topic in Colombian political future

🪙Economic challenges

• Decrease the national debt while still fund social programs 
• Lower the inflation rate and optimize economic growth 
• Stop the increase of the unemployment rate

Colombia has major economic potential due to their market size and the quality of their resources, in order to achieve it they must be able to deal with their current challenges. 

🇲🇽 Mexico: Landscape of mixed opportunities 🏛️

Mexico is the second-largest economy in LATAM, and it is preparing for a period of transition as new economic and political challenges are approaching at the end of 2024. Mexico’s population is also ready for a change in their economic system.👇

📊Economic Indicators 

• GDP: there has been a 60% increase from 2020 to 2023
• Inflation rate: It has remained stable throughout the decade, and it is sitting at 4.99%
• There is a high dependence on the USA as they are their biggest partner
• Strong manufacture sector for automotive and electronic markets

🏛️Political and current situation

As of 11 of September 2024, hundreds of protestors have stormed the senate building after the ruling party, Morena, did a controversial reform in order to select judges. There is a high public discontent over the decision and the party.

🪙Economic challenges 

• The vulnerability of their high dependence on US market
• Income and security inequalities 
• Political maneuvering that lead to high budget deficit and instability

Check our Linked-in post

https://www.linkedin.com/posts/transfer-lc_latam-land-of-opportunity-or-risky-business-activity-7238881318963466242-IJeG?utm_source=share&utm_medium=member_desktop