Latin America: the bigs continue to invest (and get bigger)...

this kind of insight and perspective is really hard to come by in u.s. media...

Foreign direct investment in Latin America and the Caribbean grew by 44 percent in 2004, following four consecutive years of decline, according to a report released Thursday by UNCTAD [United Nations Conference on Trade and Development].

But as many observers have pointed out, this growth will merely serve to boost the profits earned by transnational corporations in a region still mired in poverty and inequity.

The rise in foreign direct investment (FDI) in Latin America and the Caribbean, to a total of 68 billion dollars in 2004, was the second largest of any region in the developing world, just barely outstripped by Asia and Oceania...

[...]

The increase in FDI is good news for transnational corporations, which have reaped a corresponding increase in profits, but not necessarily for the 224 million people living in poverty and the 96 million who suffer extreme poverty in Latin America and the Caribbean, who are unlikely to benefit in any way from these new resources flowing into the region.

That is because foreign direct investment in itself does not promote social development, as Tagi Sagafi-nejad, a professor of International Business at Texas A&M International University...

[...]

Cristina Casanueva, a researcher at the Ibero-American University in Mexico and another member of the panel, commented that "foreign investment doesn't care about poverty or whether or not there is democracy in any given country."

In Latin America and the Caribbean, Brazil and Mexico were the largest recipients of FDI in 2004, accounting for 52 percent of the regional total. These are the two largest and most populous countries in the region, but they are also the ones with the highest degree of social inequality.

why, you might ask, does the lion's share of fdi flow to the two countries with the highest degree of social inequality...? i would hazard a guess... cheap labor... and here's another interesting factoid...

According to a 2003 study from the World Bank - titled "Inequality in Latin America and the Caribbean: Breaking With History?" - the richest one-tenth of the region's population earns 48 percent of total income, while the poorest tenth earns only 1.6 percent.

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