#IFB2014 #LatAm

LATIN AMERICALATIN AMERICA

Region of Contrasts & Region of Contrasts & OpportunitiesOpportunities

International Festival of Business15th July, 2014

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LatAm Macro Overview

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LatAm Overview: Opportunities

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• The UK traditionally has strong links with Latin America (in 1808, 40% of UK exports went to LatAm!), but these links weakened in the 20th Century

• Other European countries trade much more with LatAm (Germany trades 4 times more than the UK with LatAm)

• This indicates huge potential to grow trade with LatAm. Both the private & public sector have now realised this and are pushing for increase in trade

• Several of the most-watched emerging markets are in LatAm (Brazil from BRICS, Mexico from MINT, Colombia from CIVETS)

• Regional GDP growth of 3% in 2013 (source: ELAC)

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The Region

(Source World Bank/ECLAC)

1919 countries

1 in North America2 in the Caribbean6 in Central America10 in South America

21 21 million square kms or 14.1% of the earth's surface

GDP US$ 5.65.6 trillion in 2012

Population of 589589 million

Per capita Gross National

Income US$ 9,0709,070

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Macro snapshot

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Pro-Mexico Video

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The Power of the Pacific AllianceWhat is it and why?

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An ocean of opportunities…• Combined market of over 200 200

millionmillion consumers

• Over half half of LatAm Global Trade

• Depth & Breadth of FTA’s provide platform for growth with USA & Asia

• Main sectors Main sectors Natural resources Financial & Bus. Services Software & IT services BPO Food & Drink Consumer goods

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Ease of doing business & market access

#IFB2014 #LatAm 10OFFICIAL

FCO LatAm Economic Indicators Index

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Why Colombia?

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Regional OpportunitiesCase studies of Success

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Colombia: Regional economic sectors

•Caribbean: tourism, logistics, petrochemicals, construction materials, import/export platform to the Caribbean/Atlantic.

• Central/Andean: services, high value-added manufacturing, hub to cover domestic market, specialized agroindustry.

• Pacific: manufacturing, agroindustry, logistics, biotechnology, export platform to the Pacific Rim.

• Orinoquia: agriculture, forestry, biofuels, hydrocarbons.

• Amazon: conservation, ecotourism (Leticia).

Caribbean Region

Central / Andean Region

Orinoquía Region

Amazon Region

Pacific Region

Infrastructure & Transport

Oil & Gas

Retail

Financial & Professional Services

UK Opportunities

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Colombia Case StudySector: Supermarket Retail

Company: Waitrose is a chain of British supermarkets, forming the food retail division of Britain's largest employee-owned retailer, the John Lewis Partnership.

Support provided: • Market and sector analysis and list of the potential distribution partners

• Market visit support• Help to set up client meetings • Follow-up on negotiations and in-market support

Outcome: Advanced distribution partner negotiations close to fruition.Next stage is to confirm SKU’s.

“UKCT gave first class support to me before, during and after the trip. They had an excellent insight into the markets and connected me with the right people in the right places, which was invaluable.“

 "quality you'd expect at prices you wouldn't"

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Mexico: Regional Economic Sectors

Aerospace& Automotive

Oil & Gas

Retail

Healthcare & Life Sciences

Healthcare and Life SciencesThe Federal Commission for Protection Against Sanitary Risk has been working hard to reduce the barriers to entry for new medicines entering the country. Demand for services & products is high

Aerospace & AutomotiveWith an average 20% annual growth rate since 2004, Mexico has become a global leader in aerospace sector, boasting 270 companies and supporting entities

Oil and GasMexican production at almost 2.5 Million barrels per dayLast year’s Energy Reform and secondary allow for private investment

RetailGrowing middle class drive demand for consumer electronics, clothing and household goods

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• North (Atacama Desert): mining, mainly copper of which Chile is the world’s largest producer. Also Lithium and Molybdenum. Related Energy and Water. The climate is similar to Northern Africa.

• Central Valley, with capital Santiago and Valparaíso (port and seat of Congress): Renewable Energy, Infrastructure, mining, manufacturing, agriculture, wine, agribusiness,, retail and financial services. The climate is similar to Madrid and Rome

• South: Renewable Energy, forestry, salmon farming, fishing, agriculture and, in Concepción, petrochemicals and steel production. This region is rainy and similar to the UK.

• Fjords and Tierra del Fuego: tourism, agriculture, aquaculture, fishing, gas and oil production, coal mining, wood pulp & board. This sector is snowy and windy, very similar to Scandinavia.

Chile: Regional Economic Sectors

16% of GDP

75% of GDP

9% of GDP

MiningFishingAgriculture

Manufacturing ServicesAgricultureCattle Breeding

Forestry

Fishing

Agriculture

Mining

Santiago

49% of GDP

Antofagasta

11% of GDP

Concepción

7% of GDP

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Chile Case StudySector: Health

Company: BioEden, the World’s First banking service for dental stem cells. Now they serves Members in over 60 countries, with storage lab facilities in the UK, the USA and Asia.

Support provided: • Product launching at the HM Ambassador Residence• Complete market assessment• Tailored advice on Chilean consumer consumption behavior and trends• Comprehensive list of contact • Developing meeting

Outcome: Develop BioEden business model based on a franchise. Encourage the use of Tooth Stem Cells among people through dentists to promote the solution.

"…building an organ that is a match for you, is available for you, is something that wasn’t even fathomable ten or 15 years ago…"

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Growing LatAm Presence of UK Brands

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• Latin America has a wide mix of business opportunities for UK plc:

• Vast divergence in market size and business environments across countries and country groups (e.g. Mercosur, Pacific Alliance, the Caribbean and Central America).

• We must look at different ways to maximise UK opportunities in different markets and regions, even within markets.

• Brazil remains the number one prospect in terms of market size and growth potential, but its business environment remains weak:

• Its size means continued opportunities for exports and investment, but low competitiveness, high protectionism and corruption could hinder UK success.

• BUT Pacific Alliance countries provide the best balance of opportunities in terms of both growth outlook and ease of doing business.

• Encouraging businesses in key sectors could bring quicker wins in these economies than in other markets.

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