Shannon K. O'Neil

Latin America's Moment

O'Neil analyzes developments in Latin America and U.S. relations in the region.

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Showing posts for "Chile"

Review of State Building in Latin America

by Shannon K. O'Neil
Hillel Soifer, State Building in Latin America, state capacity Cambridge University Press, 2015

Hillel Soifer’s new book, State Building in Latin America, presents an interesting historical perspective on today’s current state capacity in Latin America, and why some countries are so much better able than others to not just control territory but also to deliver for their people. Read more »

Economic Clusters, Productivity, and Growth in Latin America

by Shannon K. O'Neil
Alfred Marshall, Michael Porter, Queretaro aerospace, Chile salmon, Start-Up Chile, Clusters Workers places salmon carcasses into a box to be sent to the world market at the Acuinova Chile salmonera company located some 1,625 km south of Santiago March 5, 2009 (Victor Ruiz Caballero/Reuters).

This post was co-authored by Gilberto Garcia, research associate for Latin America Studies at the Council on Foreign Relations.

How can countries boost productivity and economic competitiveness? Many economists and business leaders turn to economic clusters as an answer. Read more »

Foreign Direct Investment in Latin America

by Shannon K. O'Neil
Foreign Direct Investment, Latin America A Venezuelan worker assembles a motorcycle made of Chinese parts at the Empire Keeway factory in Charallave, outside Caracas December 14, 2011. Every time that Beijing turns the gear of their loans to Caracas, thousands of barrels of oil are shipped to Asia, get tons of goods to South America and create dozens of companies as part of an oiled mechanism that gives millions of dollars to the Government of Hugo Chavez and great benefits to the Eastern giant (Jorge Silva/Reuters).

Foreign direct investment (FDI) in Latin America fell in 2014, down 16 percent to $159 billion according to the latest ECLAC report. This outpaced global declines closer to 7 percent, and fell far behind other emerging markets, which saw investments rise 5 percent on average, and 15 percent in Asia. Read more »

China’s RMB Swap Lines with Latin America

by Shannon K. O'Neil
China, Argentina, swap lines Argentinian President Cristina Fernandez de Kirchner (L) and Chinese President Xi Jinping shake hands and face the media after signing documents during a ceremony at the Great Hall of the People in Beijing February 4, 2015 (Rolex Dela Pena/Reuters).

My colleagues Benn Steil and Dinah Walker recently published a great interactive on the spread of central bank currency swaps since the financial crisis. They find the United States provided developing nations with significant support through swap lines at the height of the financial crisis, but that China has been the most active extender of swap lines since 2009. China now has thirty-one swap agreements outstanding. Read more »

Latin America’s Middle-Income Trap

by Shannon K. O'Neil
Latin America, Middle-income trap A student writes down in her note book on the first day of school in Managua February 11, 2013. Around 1.6 million students are expected to start their new academic year, according to the Ministry of Education of Nicaragua (Oswaldo Rivas/Courtesy Reuters).

In 2014, GDP growth in the region slowed to less than 1 percent. Expectations for 2015 are just slightly better, with forecasters predicting growth of nearer to 2 percent. The downturn reflects external factors, including the European Union’s continuing problems, a slower China, and falling commodity prices. But it also results from domestic barriers that hold these nations back. Read more »

South-South Trade and Latin America

by Shannon K. O'Neil
South-south trade, developing south trade, inter-industry trade, Latin America, exports, intermediary goods Workers harvest soy in a farm during a demonstration of harvest machines in Correntina, Bahia March 31, 2010. Brazil's 2009/10 soybean production is estimated to be 67.5 million tonnes (Paulo Whitaker/Courtesy Reuters).

The economic rise of the developing south is one of the biggest trends of the last decade, accelerated by the 2008 global economic downturn. Since 2001 trade between these countries has grown 18 percent a year on average, outpacing global trade growth of 11 percent. Nearly half of all exports worldwide now originate in emerging markets—predominantly Asia. Read more »

Foreign Direct Investment in Latin America Holds Steady in 2013

by Shannon K. O'Neil
Robots weld cars at the Ford Motor Company's Sao Bernardo do Campo facility in Sao Bernardo do Campo, June 14, 2012 (Paulo Whitaker/Courtesy Reuters). Robots weld cars at the Ford Motor Company's Sao Bernardo do Campo facility in Sao Bernardo do Campo, June 14, 2012 (Paulo Whitaker/Courtesy Reuters).

In 2013, foreign direct investment (FDI) in Latin America reached $185 billion according to the latest ECLAC report, continuing the slight upward trend of the last three years. Brazil maintained its number one position as the largest FDI destination, raking in $64 billion (over one third of all regional FDI). Mexico came in second, with some $38 billion (boosted by the $13 billion purchase of the rest of Modelo by Belgian based Anheuser-Busch InBev, a company run by Brazilians). Mexico’s Pacific Alliance partners—Chile, Colombia, Peru—also had a fruitful year, with a combined $47 billion in investment. And despite its economic woes, Argentina garnered $9 billion. Read more »

Trans-Pacific Partnership Negotiations Head to Washington

by Shannon K. O'Neil
U.S. President Barack Obama (C) speaks at the Trans-Pacific Partnership Leaders meeting at the Hale Koa Hotel during the APEC Summit in Honolulu, Hawaii, November 12, 2011 (Larry Downing/Courtesy Reuters). U.S. President Barack Obama (C) speaks at the Trans-Pacific Partnership Leaders meeting at the Hale Koa Hotel during the APEC Summit in Honolulu, Hawaii, November 12, 2011 (Larry Downing/Courtesy Reuters).

One of the potentially biggest economic initiatives for Obama’s second term is the Trans-Pacific Partnership (TPP). Started some seven years ago by four Pacific nations—Brunei Darussalam, Chile, New Zealand, and Singapore—to spur trade by eliminating tariffs, the agreement has now expanded to encompass twelve nations, including the United States, Australia, Canada, Japan, Malaysia, Mexico, Peru, and Vietnam. The block’s combined GDP reaches some $28 trillion, with member countries conducting roughly a third of all global trade. Read more »

Foreign Direct Investment and Jobs in Latin America

by Shannon K. O'Neil
Employees work at an assembly line at a Ford manufacturing plant in Sao Bernardo do Campo June 14, 2012 (Paulo Whitaker/Courtesy Reuters). Employees work at an assembly line at a Ford manufacturing plant in Sao Bernardo do Campo June 14, 2012 (Paulo Whitaker/Courtesy Reuters).

In 2012 Latin America received its largest amount of foreign direct investment (FDI) to date: $170 billion or 12 percent of global flows. These flows went into a range of sectors from mining and petroleum production to high skilled and low skilled manufacturing to telecommunications and electricity. Read more »

What to Watch in 2013: U.S. Policy Toward Latin America

by Shannon K. O'Neil
U.S. President Obama delivers a speech in front of banners representing Latin American nations in Santiago U.S. President Obama delivers a speech in front of banners representing Latin American nations in Santiago (Jason Reed/Courtesy Reuters).

2013 could be an interesting year for U.S. policy toward the region. Up first will likely be U.S. immigration reform. The outpouring of support from Latino voters in the November presidential election, helping push Barack Obama to victory, combined with the better organization and more aggressive stance of many pro-immigration advocates may motivate lawmakers on both sides of the aisle to come up with legislative reforms. In fact Obama officials have already stated that they will turn to immigration early this year. Read more »