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South America - Trends

Overview

In South America, mining, energy and agriculture sectors are mainstays, while manufacturing and services industries are growing, especially in Brazil, Chile and Colombia. Trade bloc efforts are driving cross-border infrastructure expansion in transport, logistics and energy. Key challenges around political uncertainties, funding and skills shortages remain.

South America possesses vast natural resource wealth ranging from oil and gas reserves to precious metals and minerals to fertile agriculture land. This underpins the steady growth in energy, mining and agribusiness sectors across the region.

At the same time, efforts are underway to advance manufacturing capabilities and services industries to support economic diversification. Brazil, Chile, Colombia, Peru and Argentina are making substantial investments to this end. Brazil is expanding domestic production of oil rigs and ships while growing exports of Embraer aircraft and Iveco commercial vehicles. Government initiatives like Brasil Maior provide incentives for high-tech manufacturing growth. The services sector accounts for almost 70% of GDP.

Chile and Peru are focused on expanding copper processing and integrated mining operations. Chile also aims to be a Latin American hub for space technology and astronomical research. Both countries are also diversifying into solar energy investments. Mexico makes use of its free trade pacts for developing competitive automotive, electronics and medical device fabrication abilities. Colombia and Argentina are other emerging manufacturing locations with infrastructure upgrades underway around major industrial parks and ports.

While South America has seen political and economic volatility over the decades, integration efforts via trade blocs like Mercosur and the Pacific Alliance are helping modernize cross-border infrastructure and energize industrial cooperation across the continent.

Trends

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