Forum looks at Latin business, economy

Daily Staff Reporter
Published April 8, 2001

Most people think of Latin America as marked by poverty and unstable governments, not a growing area for investments. But at the Latin American Business Conference Friday, representatives from some of Latin America"s largest corporations visited the University to discuss political, economic and technological trends in Latin American making students reexamine the economic potential of the region.

"The goal was to raise awareness of business in Latin America," said Guilherme Larangeira, a second-year Business student. "Despite all the problems, it is a huge area for investment and it"s growing very fast despite the past decade."

Larangeria said the purpose of the conference was also to draw attention to the University"s knowledge and interest in Latin American business.

"It was to show that Michigan has a strong body of students that know about the Latin American business environment," he said.

One participant at the conference, political science doctoral student Jon Shill, who has attended the conference every year, said the perceptions of business opportunities in Latin America have evolved during those three years.

"I think the first one included a lot of irrational exuberance and thought that Latin American economies could do no wrong. Last year people were more pessimistic, this year I think perspectives are more sober," Shill said.

Newton Leme Duarte, the general manager of General Electric South America, gave a presentation covering the potential consumer growth in Latin America and strategies for success in the region.

"We have over 485 million people eager to consume," Duarte said. "We have seen huge investment in the region with in the past year."

He said in many regions of Latin America, the success or failure of a company depends on the ability to understand and adapt to the nation"s culture.

"One of the most important things in Latin America is to be local," Duarte said. "It"s very important to work with local people and use a local force, be local and be established."

Duarte said some problems still exist in the region, but the solutions to these problems are within the reach of corporations and the government. "I think the companies have to face the reality that they have to be not as big, the governments have to be serious about how they spend their money and I think most important of all is that the people have to be educated," he said.

In a panel discussion, three representatives from Latin American businesses discussed the macroeconomics and politics of Latin America with a focus on the economic development of Brazil and Mexico.

Paulo Vieira da Cunha, the vice president and Latin American economist for Global Group at Lehman Brothers, said the U.S. economic slowdown has a drastic effect on Mexico because of Mexican dependence on goods purchased by the United States.

"When you look at the situation happening today what you have is Mexico which is responding in a chronic shock to the US economy," Cunha said. "In Mexico exports are not a source of growth they are the source of growth."

Another speaker, Vice President of A.T. Kearney Mexico, Ricardo Haneine, said the role of the government and new privatization of some industries have changed the development Latin American economies.

"Deregulation has been done in a very bad way. The government has to learn how to create a market-based economy," Haneine said.

Nauro Campos, an economics lecturer at the University of Newcastle, England, spoke about the phenomenal development of Brazil during the past century and the future of the states economy.

"Was this the Brazilian century? Economist and politicians will agree it was indeed the Brazilian century," Campos said.

He said although Brazil has suffered through a devastating economic downturn in the past decades, it is once again ready for growth.