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Taking a look at the biggest economies in Latin America and the most recent finance current events, we can safely say that Brazil and Mexico are comfortably in“first” and “second” place, respectively, not only being the only countries in the region that have a Gross Domestic Product (GDP) of over 1 trillion USD, but also having over 50% of the region’s GDP when combined.Next in line are Argentina, Colombia and Chile making it so that Mexico is the only country among the biggest economies of the Latin America region that is not located in the South American continent.
Understanding the position that Brazil and Mexico have becomes easy when you take a look at the population of both countries. Brazil hasmore than 200 million inhabitants and Mexico roughly 126 million as of 2018. The next most populous country is Colombia with roughly 50 million inhabitants. Looking at the difference in population size, we can understand why both countries make up such a large part of the region’s economy.
Brazil remains as the biggest economy inthe Latin America region, despite the economic recession that it enduredin 2014 and only managed to recover in 2017. Brazil’s main products of export aresmineral fuels, oil seeds and ores. Despite a historical trend of exporting unprocessed products, in recent decades, most of Brazil’s exports consist of manufactured products and semi-manufactured products.
Mexico’s economy has been growing steadily since 2009, after the 2008 recession. The main grown areas have been in developing services and industrial sectors and also focusing its economy in an export oriented direction with free trade agreements with several countries, notably the USA. Of note is the automotive industry, in which it differentiates itself from other Latin American countries where it takes part in developing and designing components rather than being only an assembly line, and the electronics industry where it is the sixth largest industry in the world.
Chile’s case is impressive when looking at its economy in the 21st century, where it became the highest in the Global Competiveness Report by the World Economic Forum among all countries in Latin America, due to its reforms and policies enacted in the last decades.
One country of note that should also be mentioned is Venezuela that had one of the highest GDP per capita of Latin America due to its vast reserves of oil.Due to a lack of new data in the last couple of years because of instability in the country, the country wasn’t included among the biggest economies of the Latin America region since its position now can’t be determined (safe to say it’s much lower due to political turmoil).
Recently, the Latin American region as a whole has been facing a massiverecession, estimated to decrease the GDP varying from 6% to 10%. Lockdown measures have beennecessary because of less developed health care systems. While it is estimated that most of these countries will be able to enjoymodest growth in 2021, it is undeniable that the impact left from the pandemic will be felt for years to come. Keeping up with finance current events will keep you in the loop with what is happening in the world of business and help paint a more vivid future of how global economies will function in the future.
