Latin American companies set record in Foreign Direct Investment (FDI), according to a new report

The region has a unique opportunity to drive the climate transition through its "green bonds"
 

Despite global economic challenges, such as the impact of Russia’s war in Ukraine, Latin American companies are still conquering markets abroad.
The latest "Global Latam" report by ICEX-Invest in Spain and the Ibero-American General Secretariat (SEGIB in Spanish) reveals that Foreign Direct Investment from the region reached a record $73.499 billion in 2022. This figure is 75% higher than in 2021, a year marked by the consequences of the pandemic.

Although Latin American economic growth in 2022 was slower than in other regions of the Global South, such as Asia and the Middle East, its business fabric keeps growing at the international level.
The report details that the reinvestment of dividends was the source of most of the FDI funds, an aspect that consolidates the companies’ presence in certain countries but does not open as many doors in other nations, nor does it facilitate access to new industries and technologies. Another factor explaining the success abroad is the rise in prices of raw materials or commodities.

ICEX-Invest in Spain and SEGIB add in their work that "Brazil, Mexico, and Chile account for nearly 80% of the FDI issued in the period since the pandemic, a percentage that remains the same in 2022". In addition, Latin America has 11 of the 100 largest non-financial companies from countries in the Global South with the greatest international outreach. These firms are América Móvil, JBS, Cemex, Fomento Económico Mexicano, Bimbo, Grupo México, Ternium, Arca Continental and Falabella.

But perhaps the role that Latin America can play in combating climate change and promoting decarbonization is even more relevant. The investments that the region receives to finance sustainable projects, such as renewable energy infrastructure, are vital.

According to the report, which cites data from the Inter-American Development Bank, "the total amount of green bonds issued in Latin America amounts to 41,228 million dollars, with a total of 291 bonds from 186 different issuers", with Brazil and Chile on the lead.