Latin America getting more globalized
Stefan Geens | Nov 20, 2006
If recent headlines coming out of Latin America give you the impression that anti-globalization and populism are running rampant, here's a pleasant reality check: Latin economies became markedly more globalized, not less, in 2006, according to the 2006 Latin American Globalization Index from Latin Business Chronicle.
The index captures imports, exports, FDI, tourism receipts, remittances and internet penetration for 19 countries in Latin and Central America:
Of the 19 countries included in the 2006 index, 14 improved their score, while only three saw declines. The average score for the region is now 9.14, up from the 8.76 in the 2005 index.
The Central America-Dominican Republic Free Trade Agreement (CAFTA-DR, or more popularly known as CAFTA) is the big winner in the 2006 globalization index. Five of its members captured the top seven spots, including the number two position. All but one of the six CAFTA members improved their score from last year. Costa Rica and Nicaragua made most progress, but also El Salvador, Guatemala and Honduras became more globalized. Costa Rica jumped from third place overall to second place, while Nicaragua jumped from sixth to third place on the index.
Panama sits atop the list, while Brazil comes last, swapping places with Argentina from last year. Although it is true that the smaller a country gets, the more it must depend on trade to prosper, Brazil's drop to last place (and falling absolute indicator) is a disappointment. Still, it's good to be reminded that most of the region's countries are avid free traders. Here's the full list.