Brazil’s economy is one of the great success stories of Latin America, and it has been said by many economists that it, along with the emerging heavyweights of Russia, India and China, will shape the direction of the coming century.
But on the other side of the Andes mountains, the countries of Chile, Peru and Colombia quietly set about outdoing their neighbor in 2011, growing at more than twice the rate of the emerging global power, according to a recent report by Reuters.
The three Andean nations have all followed similar economic policies, and integrated their economies to form a regional bloc. In 2011, they created Latin America’s second-largest exchange, The Integrated Latin American Market (MILA), by merging their stock markets.
The Reuters report attributed the swift growth of the MILA countries to low public debt, enthusiastic investment – allowed by large fiscal surpluses – and an aggressive pursuit of free-trade deals with larger economies, which have made the Andean markets among the world’s most open economies.
Chile sets a fast-growing precedent
Chile’s economy set a record growth rate in 2011, when it expanded by 6 percentage points, and while 2012 paints a more complicated scenario for the the world’s top copper-producing country, that growth will continue is unquestioned.
In the beginning of the year, Chilean President Sebastián Piñera – on the back of the euro-zone’s debt crisis and a slowdown in China’s economy – forecast a conservative growth rate of 4 percent in 2012.
However, that figure may yet have to be drastically upgraded.
The IPSA index, which follows the top 40 stock traders in Chile and is used to gauge the movements of the stock market as a whole, closed at its highest level in eight months last Monday.
In the three and a half months since the beginning of the year, the IPSA has increased 11 percent, a rate which seems to indicate that the Chilean stock market will experience its best trimester in 15 years.