FOR IMMEDIATE RELEASE
Institutional investors in Latin America should target assets in the region because they hold great potential. The sectors to invest in can be identified by looking at which assets sustain high growth without a high level of support from the global economy, says Juan Lorenzo Maldonado, Senior Latin American Economist, Roubini Global Economics. Economies that implement better reforms will have better returns in these uncertain financial times, he adds.
A speaker at the upcoming marcus evans Latin Investors Summit 2013, in Panama City, Panama, February 25 - 26, Maldonado discusses why the way Latin American countries re-evaluate their economic growth is important to locating attractive investment opportunities.
How can Latin investors sustain investment growth?
Latin America is showing great potential thanks to robust balance sheets and overall improved macroeconomic management, reflected in matured inflation targeting regimes and prudent fiscal management. Latin investors should stay within their own region and identify the markets that are being nourished more by their domestic economy rather than by leaning on global economy for support. Investors should focus on economies that are implementing better structural reforms, as they are more likely to sustain attractive growth rates in the medium term.
The more the region re-evaluates the way its economies grow, the more opportunities will come forward. Increasing productivity through education and investment through research and development, while also finding alternatives for social growth and ways to make use of natural resources, will bring about the changes investors need to locate the best possible areas for investments.
What can they do to avoid risk coming from developed markets?
Risk can be managed by prevention with investors seeking out economies that are more resilient to global risks. The biggest shift that is coming this decade is the end of the commodity boom of the past ten years, due to rebalancing in China and sluggish growth in developed markets for the next several years, given ongoing balance sheet repair. As such, determining which Latin American economies are less vulnerable to this down cycle is important. Keeping an eye on these changes and predicting the outcome can help define risk management and the investor can better weather concerns from the international economy.
How can investors deal with problems brought about by inconsistencies in domestic growth models?
How these difficulties can be faced depends on how the countries in the region are implementing structural reforms. Many countries are already attempting to mend their structural shortcomings in their domestic growth models and strengthen domestic markets. Reforms are already on the table for energy, electricity, fiscal, labor and infrastructure sectors, for instance, in various economies.
Monitoring which countries are working on their structural domestic problems and how their governments are tackling different vulnerabilities will point investors to sectors that will flourish.
Contact: Maria Gregoriou, Journalist, marcus evans, Summits Division
Tel: +357 22 849 400
About the Latin Investors Summit 2013
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