Foreign Direct Investment in Latin America and the Caribbean 2017
This publication sets out and analyses the main foreign direct investment (FDI) trends in the countries of Latin America and the Caribbean. The 2017 edition shows that the region is at a difficult juncture. FDI inflows declined by 7.9% in 2016, to US$ 167.043 billion, representing a cumulative fall of 17.0% since the peak in 2011. The fall in commodity prices continues to affect investments in natural resources, sluggish economic growth in several countries has slowed the flow of market-seeking capital, and the global backdrop of technological sophistication and expansion of the digital economy has concentrated transnational investments in developed economies.
This publication sets out and analyses the main foreign direct investment (FDI) trends in the countries of Latin America and the Caribbean. The 2017 edition shows that the region is at a difficult juncture. FDI inflows declined by 7.9% in 2016, to US$ 167.043 billion, representing a cumulative fall of 17.0% since the peak in 2011. The fall in commodity prices continues to affect investments in natural resources, sluggish economic growth in several countries has slowed the flow of market-seeking capital, and the global backdrop of technological sophistication and expansion of the digital economy has concentrated transnational investments in developed economies.
You also want an ePaper? Increase the reach of your titles
YUMPU automatically turns print PDFs into web optimized ePapers that Google loves.
<strong>Foreign</strong> <strong>Direct</strong> <strong>Investment</strong> <strong>in</strong> Lat<strong>in</strong> <strong>America</strong> <strong>and</strong> <strong>the</strong> <strong>Caribbean</strong> • <strong>2017</strong><br />
Chapter I<br />
43<br />
Table I.6<br />
Lat<strong>in</strong> <strong>America</strong> <strong>and</strong> <strong>the</strong> <strong>Caribbean</strong>: 10 largest divestments, 2016<br />
Sell<strong>in</strong>g firm/<br />
country of seller<br />
Assets sold/<br />
buyer<br />
Sector<br />
Amount<br />
(millions of dollars)<br />
Country of buyer<br />
HSBC Hold<strong>in</strong>gs PLC<br />
United K<strong>in</strong>gdom<br />
HSBC Bank Brazil S.A.-Banco Multiplo,<br />
HSBC Serviços e Participações Ltda.<br />
Banco Bradesco S.A.<br />
F<strong>in</strong>ance<br />
5 186 Brazil<br />
Petroleo Brasileiro S.A.<br />
Brazil<br />
Petrobras Argent<strong>in</strong>a S.A. (67.19%)<br />
Pampa Energia S.A.<br />
Oil <strong>and</strong> gas<br />
892 Argent<strong>in</strong>a<br />
AES Corp.<br />
United States<br />
AES Sul Distribuidora Gaucha de Energia S.A.<br />
CPFL Energia S.A.<br />
Energy<br />
464 Brazil<br />
Institutional <strong>in</strong>vestors<br />
United States,<br />
Venezuela (Bolivarian<br />
Repepublic of)<br />
Empresa Distribuidora de Energia Norte S.A.,<br />
Empresa Distribuidora de Energia Sur S.A.<br />
Desarrolladora Energetica S.A.<br />
Energy<br />
220 Argent<strong>in</strong>a<br />
Lyondell Basell Industries<br />
Ne<strong>the</strong>rl<strong>and</strong>s<br />
Petroken Petroquimica Ensenada S.A.<br />
Grupo Inversor Petroquimica<br />
Manufactur<strong>in</strong>g<br />
184 Argent<strong>in</strong>a<br />
EDP-Energias<br />
de Portugal S.A.<br />
Portugal<br />
Pantanal Energetica Ltda.<br />
Cachoeira Escura Energetica S.A.<br />
Energy<br />
124 Brazil<br />
Sears Hold<strong>in</strong>gs Corp.<br />
United States<br />
Sears Operadora Mexico S.A.<br />
de C.V. (rema<strong>in</strong><strong>in</strong>g 14%)<br />
Grupo Sanborns S.A.B. de C.V.<br />
Retail<br />
106 Mexico<br />
KLS Ltd.<br />
Republic of Korea<br />
Marcobre S.A.C. (rema<strong>in</strong><strong>in</strong>g 30%)<br />
M<strong>in</strong>sur S.A.<br />
M<strong>in</strong><strong>in</strong>g<br />
85 Peru<br />
Host Hotels & Resorts Inc.<br />
United States<br />
Hotel Sheraton Santiago <strong>and</strong><br />
San Cristóbal Tower<br />
Larra<strong>in</strong> Vial S.A.<br />
Hotels<br />
76 Chile<br />
International Meal Co.<br />
Alimentaçao S.A.<br />
Brazil<br />
Inversionistas en Restaurantes<br />
de Carnes y Cortes<br />
Taco Hold<strong>in</strong>g SAPI de CV<br />
(subsidiary of Nexxus Capital)<br />
Restaurants<br />
61 Mexico<br />
Source: Economic Commission for Lat<strong>in</strong> <strong>America</strong> <strong>and</strong> <strong>the</strong> <strong>Caribbean</strong> (ECLAC), on <strong>the</strong> basis of Bloomberg.<br />
4. FDI rema<strong>in</strong>s <strong>the</strong> most stable component<br />
of capital <strong>in</strong>flows<br />
The effects of FDI on external accounts can be assessed based on several factors.<br />
First, foreign <strong>in</strong>vestment cont<strong>in</strong>ues to be <strong>the</strong> largest <strong>and</strong> most stable f<strong>in</strong>ancial account<br />
component. In 2016, despite a 7.8% decl<strong>in</strong>e, FDI accounted for 71% of foreign capital<br />
<strong>in</strong>flows. The o<strong>the</strong>r two components were worth less <strong>and</strong> were more volatile: portfolio<br />
<strong>in</strong>vestment <strong>in</strong>creased by 4.5%, but rema<strong>in</strong>ed much lower than levels atta<strong>in</strong>ed between<br />
2010 <strong>and</strong> 2014, while o<strong>the</strong>r <strong>in</strong>vestment <strong>in</strong>flows collapsed (see figure I.14).<br />
In 2016, despite a 7.8%<br />
decl<strong>in</strong>e, FDI accounted<br />
for 71% of foreign capital<br />
<strong>in</strong>flows.
Change language