As the euro zone teeters and the U.S. continues to stagnate, Latin America is taking off.
According to the latest World Bank report, Latin America has spent the last decade in rapid expansion — and the growth has benefited the poor.
More than 50 million people have been lifted from moderate poverty from 2002 to 2008. That number is only expected to increase. The middle class expanded, too.
The global economic crisis didn’t do much damage here. Brazil, the major regional power, has even been asked to buy up some euro zone debt. (They’re thinking about it, along with the other BRICS.)
Several countries have taken off so strongly that their growth is now settling in a more mature, albeit slower, growth pattern that will be similar to East Asia, Eastern Europe and Central Asia.
The bulk of the growth comes from South American nations with strong economies and more stable politics: Argentina, Brazil, Bolivia, Chile, Paraguay, Peru and Uruguay.
Mexico was among those with some of the lowest growth, which is defined as posting GDP growth below 4 percent.
The bulk of the expansion could only come from one place:
Before this past decade, Latin America had almost no economic connection to China. Now China’s one of the biggest trading partners for countries such as Brazil, Chile and Peru, according to this report.
Now, all they have to do is maintain those ties — and secure some other sources of longterm growth. It won’t be easy.
The World Bank noted that despite their robust growth, Latin American nations haven’t made the leaps that the East Asian “tigers” had decades ago.
And Latin American countries will need to ensure their relationship with China remains cordial. China was irked by the Dalai Lama's recent tour of the region. A recent study shows China does more then rant when its trading partners meet with the Tibetan spiritual leader — it cuts down on the business they do together.