Latin America: Embracing Globalization and Technology for a Brighter Future

We live in a world with instantaneous communication, shaped by both globalization and technology. These forces connect countries, cultures, and people, transforming economies and societies worldwide.

From a marketing perspective, one of the most critical aspects of globalization and technology is the data revolution and the creation of a digital culture that transcends country lines. Understanding the role of technology in globalization is key to understanding how LATAM has developed in recent years. Access to and adoption of contemporary technologies present both benefits and challenges to countries in LATAM, affecting fields like healthcare, agriculture, education, finance, and supply chains. All of this is, in part, thanks to the abundance of data that allows one to make informed decisions using data analytics (Gupta & Ansurkar, 2023).

However, this journey is not free of challenges. The rapid pace of technological changes and the increased importance of technology in the global economy make it harder for developing countries to keep up with the momentum and adapt to new resources. Increasing technological capability, flexibility, education, infrastructure, and human capital is key to competing on the global stage. Despite these challenges, Latin America is competing in the global market through trade and digital cultural presence (Dahlman, 2018).

In recent years, the region's development has been heavily influenced by the US and China. China has become a key partner and economic sponsor, assisting Latin American economies through trade, investments, loans, and currency swaps. Many LATAM countries are inviting China to be a commodity buyer and supplier.

This relationship has increased significantly over the past few years and shapes trade opportunities for countries like Brazil, Chile, and Peru (Zaga et al., 2023). For instance, Brazil has been experiencing significant development, thanks in part to Chinese investments in infrastructure projects like the second transmission line of the Belo Monte Dam (Leal, 2016). Brazil has also become one of the major soybean suppliers for China, with exports reaching $53.2 billion in 2023 (Colussi, 2024).

Similarly, Peru has benefited from Chinese partnerships in projects like the Toromocho copper mine. This investment is part of China’s efforts towards energy and mining projects in Latin America. Additionally, Peru has signed a free-trade agreement with China, showing that both countries are growing an economic relationship (Zaga et al., 2023).

On the US side of things, investments have boosted the Latin American economy over the past two decades - doubling LATAM’s imports to the US from $200 billion in 2002 to approximately $380 Billion by 2020 (ECLAC, 2020). Initiatives like the Free Trade Area of the Americas (FTAA) in the early 1990s have helped Latin American countries to establish a presence (Spak et al., 2022).

More recently, Biden’s Americas Partnership for Economic Prosperity (APEP) in 2022 aimed to reinvigorate regional economies and make them sustainable by strengthening supply chains, enhancing infrastructure, and bolstering environmental programming (U.S. Department of State, 2022).

The past four years have been pivotal for Latin America’s development. The 2020 pandemic, despite its challenges, accelerated globalization and the adoption of technology (Werner et al., 2020). Countries like Argentina, Chile, Colombia, and Mexico saw approximately 40% of employees teleworking during lockdowns.

Sectors like professional services, information and communication, and financial services had the greatest rate of growth during that period, and although the percentage of teleworkers was reduced after the lockdowns ended, the region gained the experience necessary to join the global market of those sectors (Prada et al., 2023).

With the support of regions like the US and China, Latin America has been able to generate economic treaties that have facilitated exporting resources. The upward shift in Latin America’s growth trends shows the region's resilience and adaptability. Despite the slow bounce back at the beginning of the pandemic, the region has shown a great recovery over the past couple of years (The World Bank, 2023).

Technological industries are also a crucial component of the rapid recovery in the region. The race for development of next-generation technologies by the USA and China pushes Latin American countries to find new ways to innovate and establish technological partnerships (Toledo & Júnior, 2021).

So, what will the future look like for Latin America? The region did not advance as much as it could have in recent years. It remained lagged in technological adoption until recently; however, if the transition to this new technological era is handled well, LATAM’s abundance of critical resources could translate into investment in infrastructure and human capital development, which paves the way for a brighter future (Cadena et al., 2022).

Latin America stands at the crossroads of globalization and technology. Despite facing significant challenges, the region keeps showing remarkable resilience and adaptability. It has developed global connections to access new opportunities.

As we look towards the future, Latin America is rapidly becoming a strong player in the global economy. As market researchers, we invite you to take the opportunity and use to good advantage our unique position to observe this exciting transformation. Let’s seize the opportunity to uncover the insights that will drive the next evolution in this dynamic region.