Latin America: economic and business context

This article offers a detailed view of key drivers for the wide-ranging economic reforms in the region during the 1990s, chiefly the Washington Consensus and the increased political stability. It highlights the key developments and results of the reforms in the areas of privatization (across industries), foreign investment and trade liberalization. It further provides insight into how the opening up of the regional economies resulted in multinationals penetrating and thereafter increasing their ownership of business across sectors, how, as a result, the public-sector share shrank during the period and how the local businesses adapted to this changed environment. The article also touches upon some key structural changes in the labour market as a result of the developments of the 1990s. This is followed by an exploration of the key themes and challenges facing the regional economies in the years ahead – economic, social and geo-political.