What pops into your mind when you first think of Latin America as a citizen of a country in the ancient center of the world?
Most answers would be crime shows, tropical riviera, dangerous streets, lack of democracy and decades of turmoil and military coups. It is true that some of the most beautiful and rich countries in the world have suffered such issues, especially during the 20th century. The good thing about the continent is most of the countries have had similar political and economic patterns that make it easier to expect future developments in the continent.
This means a great deal for Latin American countries connected with each other through cultural backgrounds, trade agreements and a shared history. We can see similar political or military patterns in some countries starting from the colonization era. These countries had faced similar independence struggles starting from the 1800s.
They were similarly affected by the very same economic developments that emerged during the 1940s and 1950s right after the great depression.
Similarly, almost all Latin American countries have been building a democracy-driven economic and trading culture since the 1990s, accelerated during the last decade. They took visible actions in order to support free trade across the Atlantic with treaties such as NAFTA (North American Free Trade Agreement), FTAA (Free Trade Area of the Americas), MERCOSUR (Southern Common Market), and so on.
Today we have been observing a similar pattern starting with Brazil and Paraguay – the largest and one of the smallest economies of the continent.
Brazil, which has been governed by a right-wing, populist politician Jair Bolsonaro, just decided in favor of the change coming with Luiz Inacio Lula da Silva, a.k.a. Lula.
Unlike Bolsonaro, Lula is more respectful of the unique and invaluable nature of Brazil and has zero tolerance for corruption. He believes in fair, economic growth supporting both the capital and the working class of Brazil.
Some of its most supported policies of Lula are "Zero Hunger," which aims to eradicate the hunger problem from Brazil’s lands. Learned from his predecessors, Lula has policies to strengthen Brazil’s connections to the rest of the world. Unlike in the past, the world needs an economic power like Brazil to open up just as much as Brazil needs it, maybe even more. Lula, who was the former president of the country between 2003 and 2010, has a new chance to blossom again with his interrupted work.
The expected reaction from a populist right-wing president would be to turn down the election results. And as expected, supporters driven by the ex-president are demonstrating their violent reaction against the new president as we read this article.
However, an unshakeable democracy and justice system are the first necessity of financial stability. After all, capital always seeks a haven. According to the numbers received from the Foreign Direct Investment Report, Brazil has one of the highest investment numbers in the world. Besides, it is one of the largest economies in the world with a population of over 230 million. All those investments and developments can only be sustainable with a stable climate all over the country.
One of Lula’s preeminent policies is to give poor people of Brazil higher living standards. If he can pull this “kamikaze mission” off, and gain 100% support for these policies, Brazil will automatically become a potential superpower in the region and even in the world.
Imagine a country that has everything; the young and educated population, one of the world’s largest economies, social rights, free healthcare and social services for its citizens which are fully integrated with the rest of the world. Brazil is a step closer to this mirage with Lula’s promises.
On the other hand, Paraguay has a slightly different but similar situation. The country's former president Horacio Cartes (2013-2015) has started a series of actions in order to open Paraguayan borders to the rest of the world and attract foreign investments.
Today Paraguay is one of the smallest economies in the continent with a total Gross Domestic Product (GDP) of $40 billion. The country’s foreign trade is 60% dependent on Argentina and Brazil, export products are 95% based on agriculture.
Cartes had a dream for his country. The dream was to integrate Paraguay into the rest of the world, support the country’s financial system in order to fuel reel sectors, and make Paraguay an industrial economy independent from any neighbor.
Since his time was not enough to fulfill these dreams now his protégé Santiago Pena is the most favorite candidate for the presidency with the vice-presidential candidate Pedro Alliana. The expectant president of Paraguay is the former president of the Central Bank of Paraguay and has the intention to strengthen Paraguay’s economy while improving the living standards of the common people.
Latin American countries have learned the value of free trade, building fruitful relations with other countries, supporting their own people through public healthcare, free education systems, safe industrial zones, production under government protection and ensuring the freedom of capital.
We can explicitly see a lot has changed especially since the 1990s. South American countries have been building unique types of economic structures and democratic cultures of their own. Just like the rise in Asian economies after the 1980s, there will be a big jump in Latin American economies during the next decade.
