Friday, October 28, 2011

FDI in Latin America

So many different and sometimes contradictory arguments to be made from this table on 2010-2011 foreign direct investment in Latin America, hot off the press from CEPAL:

--So a leftist/populist president in Argentina means an FDI drop. Oh wait, there was a massive increase in Venezuela

--So drug violence in Mexico means a drop. Oh wait, there was a big increase in Guatemala

--Chile is the most developed country in the region and investors love it. Oh wait, it saw a drop of 14%

--El Salvador faces severe problems with political violence. Oh wait, it had the highest increase in the entire region, at 1,404%

--Brazil is a currently a darling of investors. Yes, true, with 157% increase

--Paraguay is having major economic and political problems, so is not popular with investors. Yes, true, with the biggest drop in the region (-31%)

You can play at home.


Anonymous,  9:59 AM  

Wouldn't levels matter at least as much as year-over-year changes?

... long time reader, first time poster.

Greg Weeks 10:08 AM  

Levels are tricky because they correspond to the size of the country. A big country like Mexico will always have a high level of investment, but it is more useful to know in what direction it is going. If we look only at levels, the big countries will always look good and the small countries will always look bad.

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