February 2019
At a time when the US, one of Latin America’s most important partners, is becoming more isolationist, a new breed of internationally minded companies - the ‘multilatinas’ - are shaping the landscape, achieving big growth and shareholder returns.
While the region is getting back to business, a range of challenges face those involved in talent mobility in Latin America. In Brazil, these include compliance, particularly with immigration regulations, and cost. Assignees, too, face challenges, not the least of which are finding suitable expat housing, such as a serviced apartment or a rented property.
The multilatinas – an overview
- The multilatinas – a group of companies in a range of sectors including consumer goods, retail, telecommunications and infrastructure that practice the concept of international expansion – are helping to ensure sustained growth in the region1.
- From 2008 to 2016, the multilatinas tracked by BCG registered annual revenue growth of 5.2%: around three times higher than the average for all large Latin American companies1.
- The five key factors that are contributing to their success include: they understand and connect with consumers; they’ve overcome value chain complexities; they orchestrate innovation networks; they approach mergers in a very experienced and professional manner; and they nurture employees to unleash talent1.
- In 2018, 30% of multilatinas were originally from Brazil, while 10% were from Colombia, according to Statista. Their businesses have subsequently expanded into Argentina, Costa Rica, Panama, El Salvador, Peru, Chile and Mexico1.
Worker trends
For many Latin American workers, gig work can generate incomes higher than those obtained through formal employment. Yet the region now faces oversupply, with competition becoming more difficult since platforms have gained popularity2.
Those countries with the most gig workers include Brazil, Argentina, Mexico and Peru.
Growth predictions for the Latin American gig market state from $14bln in 2014 in $350bln income by 20252.
Movement out
Despite recent immigration changes, the US remains the number one choice of people living in Latin America, with Spain in second place and Canada third, according to an article by the World Economic Forum.
Movement in
Meanwhile, Ecuador ranks 3rd (out of 68) most popular expat destination, according to a 2018 survey3. It’s expat population mainly consists of retirees and people looking for a better quality of life.
Respondents to this survey are asked to consider things like quality of life, ease of settling in, career prospects and satisfaction, family life and personal finance.
Cashflows in
Finally, The World Bank4 records remittance flows into Latin America and the Caribbean in 2017 of nearly $80bln. This might be due to stronger growth in the US and tighter enforcement of US immigration rules leading to migrants remitting savings in anticipation of shorter stays in the US. Remittance growth was robust in Mexico (6.6%), El Salvador (9.7%), Colombia (15%), Guatemala (14.3%), Honduras (12%) and Nicaragua (10%). Remittances for 2018 were expected to grow to $83bln, backed by improvements in the US labour market.