A Review of a Surprise-filled Year (2016) and Expectations for a Year Full of Opportunities (2017)

2016, just another year?

Let’s see – Obama visited Cuba; an earthquake devastated the Manabí area in Ecuador; Brexit won and British Prime Minister Michael Cameron resigned; the new Panama Canal was inaugurated; Pedro Pablo Kuczynski became Peru’s president; Cuba and the United States reopened their embassies; Dilma Roussef was removed from office; a peace agreement was signed in Colombia; Donald Trump was elected president of the United States; Fidel Castro passed away; Italian Prime Minister Matteo Renzi stepped down; Google and Cuba agreed on providing Internet access thus marking the start of a new communications era on the largest Caribbean island.

This is just a series of outstanding events occurred along a year that still has a couple of weeks to go.

No doubt, a relevant year for the region, which has managed to cope fairly well with situations that would have been highly complex for their economic, political, and social scenarios in past years.

However, it has not been the same for everyone, with some notorious differences in a few cases.

Venezuela is undoubtedly the most dramatic example, as it is going through a relentless agonizing stage with no certain end date. Indeed a very unfortunate situation for one of Latin America’s most thriving economies in the past.

Brazil, South America’s giant, has been embroiled in one of the worst political crisis in the country’s history and has been stained by the most spectacular corruption scandal ever recorded, the notorious “lavajato” that has sent to jail the president of Latin America’s largest Brazilian company, Odebretch, and that has plunged the country into the deepest and most protracted recession in the last 115 years.

Argentina, an economy that has been stagnant during the last five years and that has everything to boom and resume its growth path, is struggling between change and regaining hope for a promising future, and the reiteration of political practices that, with few intervals, have led to a long path of decadence that has stolen the dreams of too many generations.

Chile, Peru, and Colombia, the three countries from the Andean region which, despite their differences, have kept up highly favorable cycles in the past 7/8 years, have shown that the pro-market road is a better solution to the issue of inclusion than the path of vindicating populism.

Ecuador is unfortunately ending a very special year. The earthquake that mostly hit the Manabí area has been a very hard blow, not only regarding casualties but also the damage caused to an economy that has been struggling with a plunge in the price of oil, its major export, and the challenge posed by having an economy pegged to the US dollar. Notwithstanding this, such problems have not worsened thanks to a series of wise state policies implemented by the government which, among other things, is committed to the development of tourism as an option to generate employment and foreign exchange earnings through different means other than oil exports.

Paraguay and Bolivia, two small economies that keep growing steadily and creating opportunities in different niches, such as the development of new hotel projects both in capital cities and secondary cities.

Uruguay, a fairly stable country with a solid tradition, albeit under the constant threat from the ups and downs of its two large neighbors – Argentina and Brazil. A proof of its soundness despite its small size is its ability to stay relatively safe from harm in the face of the deep crises suffered by both countries.

A bit farther away, Cuba is going through an unexpected situation within a process of change that is unprecedented in the past 54 years. The defeat of the democrats in the United States, however, seems to generate some black clouds in its horizon, where strengths and opportunities still lie for those who are willing to join in the development and growth project Cuba is already committed to.

2017, what can we expect?

The review of the year that is about to end seems to leave a rather unpleasant taste in the mouth, but it is important to underline the overall situation.

Latin America’s recurrent crises in the face of a possible change of paradigm

The world is showing clear signs of a seeming change of cycle. Brexit, Donald Trump’s unexpected (for some) presidential victory, Italy’s recent referendum defeat (among other clear signs of the need for change in societies that look more divided than usual, even if a quick review of election results in the last thirty years prove the opposite) seem to put the world as a whole in an uncertain situation which the analysts cannot yet make out. However, some –perhaps far too many- insist on forecasting the start of a new tragedy for Latin America. .

Furthermore, a renowned analyst who was born in these lands but who emigrated a long time ago to fully understand the process that most Latin American countries are undergoing, dares to foretell that the worst has not happened yet and that in some countries things will go from bad to worse.

It should be recalled that some years ago (I’d say very few if we think that the independence process in the region dates back only 200 years) any crisis or hint thereof in other continents would readily get to the south of Rio Grande and generate long-term impacts. With many things still to be solved, the scenario has changed. Crises now are neither so bad nor do they impact the same way as a few years ago, and unfortunately extremisms are no longer the exclusivity of some Latin American vandals.

Latin America’s time

Having said this, it should be underscored that Latin America’s time has certainly arrived.

A vast territory with large untapped regions, with a great capacity to grow and develop, set among rich cultures, friendly populations open to change, with the typical uncertainties of a world that is no longer the same but without any severe jolts.

A world to be discovered.

In the short run

The travel industry will continue to grow in countries like Chile, Peru, and Paraguay. Apart from the uncertainties that some would like to turn into reality, international tourist arrivals will continue to increase in Cuba, with the influx also of a rising number of American citizens.

Argentina will resume its path and will rank among South America’s first two inbound tourism leaders.

Uruguay, with a summer season that will take the country back to its glory days, will pick up and continue on its growth path into the future.

Brazil, much more competitive than in past years, will get back on the road to growth.

Ecuador and Bolivia will join the region’s generalized process where Central American and Caribbean countries like Costa Rica, Dominican Republic and Panama, to name a few, will either carry on or resume the desired growth path.

In the long run

Latin America, this exotic, unruly, sometimes unfathomable, always captivating, still untapped, and opportunity-filled land, is the region where the typical dreams of magical realism will become true.