Doing Business in the Americas? What you (and your clients) need to know
The Americas region, including North America, Latin America, and the Caribbean, is a diverse and dynamic part of the world and continues to provide attractive commercial opportunities for businesses and investors worldwide.
MSI member firms in the Americas are well-positioned to assist their clients with the increasing amounts of globalisation expected in the coming years. MSI’s law and accounting members throughout the region routinely assist clients in major business centres, cities, towns, suburbs, and rural areas. Their continued growth, collaboration and synergies suggest a bright future.
‘Cautious optimism' among investors in the Americas for foreign direct investment
The Kearney Foreign Direct Investment Confidence Index®, a reliable and trusted annual survey of business leaders, provides insights about investment opportunities in specific countries and regions. In its most recent 2023 survey, it used the term “cautious optimism” to describe the upbeat perspective shown by investors about economic globalization and prospects for continued foreign investments flowing into the Americas.
Over 80% of surveyed businesses predicted they would increase their foreign direct investment (FDI) over the next three years, an increase from 2022. In another positive development for legal and accounting professionals supporting these businesses: nearly 90% of respondents emphasised how foreign direct investment boosts their corporate profitability and competitiveness, marking a significant increase compared to last year.
Overall, foreign direct investment is considered an important indicator of business leaders’ outlook on the global economy and their appetite for future investment.
The survey further reflected ongoing positivity following the global pandemic, the recent workforce shortages, and global supply chain disruption.
Embracing regionalisation as globalisation evolves
66% of the surveyed business leaders attribute continued globalisation to an increasingly connected digital infrastructure with increasing trade opportunities and fewer barriers to trade.
Interestingly, the supporters of globalisation also expect more regionalisation to occur to help build resiliency in business infrastructure at home and in their regions.
Nearshoring, when businesses outsource their services or processes to nearby countries or regions with similar time zones and cultural similarities, is a prominent trend with investments increasing in markets that can help produce goods at low costs in near proximity to the end users. With positive views toward global investment, business leaders are acknowledging that globalisation is shifting toward a more regional approach that advances and promotes national self-sufficiency and flexible sustainability.
The Kearney Foreign Direct Investment Confidence Index®, further demonstrates investors’ continued preference for stability in developed markets with the United States and Canada, ranked #1 and 2, respectively. Emerging markets received significant attention including a strong showing for Latin American countries with Brazil, Mexico and Argentina in top spots followed by Colombia, Peru, and the Dominican Republic.
Understanding the Americas region
The Americas region represents a vast array of cultures, languages, and economies and it continues to make significant contributions to the global landscape. Like any region, it is important to understand the geography, social and cultural differences of the states, provinces, and countries to appreciate and evaluate the differences in investment and business opportunities.
Northeast – Investors appreciate the business infrastructure, educated workforce, and higher education institutions that include the prestigious Ivy League and highly ranked colleges and universities. Seaports dot the east coast providing import/export infrastructure and logistics services transporting goods to and from the rest of the world.
Mid-west – Known for its friendly business environment and land-rich opportunities, investors like working in small towns and mid-size cities to take advantage of the region’s natural resources, manufacturing, and infrastructure, well -trained and educated workforce, along with excellent colleges and universities providing world-class talent.
West coast – Long known as a tech and innovation region, investors appreciate the entrepreneurial and free-spirited environment. Well-known global tech companies were founded in this region and its numerous seaports serve as the global gateway to Asia and the world. Also known for excellent higher education and training programs.
The South – Considered low tax, welcoming environments for investors, the South has benefited from significant population growth especially post Covid. Seaports, rail, and highway infrastructure offer global trade and logistics support for businesses needing to move goods. High quality and accessible public universities create large talent pools for businesses in the region.
Atlantic Canada – Four provinces (Newfoundland/Labrador, New Brunswick, Prince Edward Island, and Nova Scotia) that produce minerals, hydroelectric capacity and offshore oil, fishing and fish procession and multiple seaports are economic engines. The population is relatively small creating workforce challenges.
Quebec – Accounts for 20+% of overall GDP and is French speaking. Montreal is a thriving business center with a rapidly growing tech industry. Manufacturing and agricultural sectors remain strong and the famed McGill University, one of Canada’s premier higher education institutions, provides bilingual, well-educated world class talent.
Ontario – Foreign investors appreciate Ontario’s international flavor, vibrant business and government sectors, and bilingual languages (English/French). Ontario accounts for almost 40% of Canada’s population. Its central geographic location, proximity to the US and waterways provide economic stability and Toronto has emerged as a global financial center. The University of Toronto is continually top ranked in Canada and globally.
Western Canada – Includes Manitoba, Saskatchewan, Alberta, and British Columbia provinces considered among the fastest growing and accounting for close to 40% of the country’s GDP. Abundant natural resources fuel development. Vancouver is an important Pacific transit port and economic hub, and Calgary is known for its low corporate tax rate, booming tech industry and agribusiness. The University of British Columbia and Alberta are considered among the best.
Northern Canada – Boasts Yukon, Northwest Territories, and Numavut provinces. With limited population density over large land masses, this important mining region is expected to play a larger role in coming years relating to international shipping and potential mineral and petroleum assets.
Latin America countries are very rich in natural resources such as oil and gas, mining like copper, iron, zinc, titanium, lithium, niobium, carbon, gold and silver among others, agriculture with special reference to soybeans, corn, wheat, sugar cane, cotton, tobacco, grape and cellulose and, naturally, cattle.
Newer industries such as technology and financial investments, have sprung from all these richness according to Brazilian lawyer and MSI Area Representative Creuza Coelho. Although neighbours, Latin American countries are very different in size, demography, GDP and language. Brazil is the only Portuguese-speaking nation among Spanish, English and Indigenous languages.
Latin American countries rely on their relationship with other countries and regions:
- Brazil has entered into thirty-eight Tax Treaties to avoid double taxation.
- Brazil, Argentina, Uruguay, and Paraguay are members of the Mercosur
- Chile, Bolivia, Colombia, Ecuador, Guiana, Peru and Suriname are signatory parties to agreements of free trade with the Mercosur.
- Venezuela has been suspended from the Mercosur ever since 2016 under the charge of noncompliance with the democratic clause.
- Mexico is a member of the USMCA , former NAFTA, together with United States and Canada. Such cooperation adds certainty and security for businesses in a cross-border scenarios.
Latin America provides abundant opportunity for investment and growth in many sectors namley infrastructure services; renewable energy / energy transition, digitalization, innovation/ biotech; and agrobusiness.
Mexico and Central America
Mexico, Guatemala, Panama, Honduras, Costa Rica, Nicaragua, El Salvador and Belize
The Mexican economy drives this region with a population of close to 130 million people. It also serves as a major North-South route for trade and transit with close to 50 Free Trade Agreements. Guatemala, Costa Rica, and Honduras offer strong manufacturing, tourism, agriculture, and a burgeoning tech sector as well as proximity to Atlantic and Pacific ports. Panama’s geography and history provide currency and logistics advantages.
All countries have major business advantages with access to ports, trade routes, and skilled workers
Colombia, Ecuador, Peru, Venezuela, Bolivia, Chile
The Andean region features valued natural resources and related industries including crude and refined oil, petroleum, copper, zinc, gold, agriculture, and food products such as sugar, coffee, flowers, fish, and livestock. Tourism, manufacturing, and construction create ongoing investment advantages relating to the region’s modern infrastructure, central location, tax incentives, free trade agreements.
Brazil, Argentina, Paraguay, Uruguay, Venezuela*(suspended)
The Southern Common Market (MERCOSUR for its Spanish initials) is an agreement of free trade and common commercial policy established in 1991. The importance of a group like Mercosur ends up being strategic; for example, the agreement between the Mercosur and the European Union.
There are also treaties among the state members and other countries and group of countries binding them together such as EFTA countries (Switzerland, Norway, Iceland, Liechtenstein); India; Canada; Australia and New Zealand; Israel; SACU countries (South Africa, Botswana, Lesotho, Namibia, Swaziland); Egypt; Lebanon; Tunisia; Morocco; and ASEAN countries (Southeast Asian countries).
Before engaging business involving other foreign countries, companies and individuals should survey what has been negotiated and establish by these international treaties and whether these rules have been already internalized by their local legislations.
Besides the international treaties with other countries, there are also treaties signed between and among the Mercosur countries to enhance specific sectors like, for example, agribusiness; telecommunications; IT products and capital goods. This has fomented businesses among these countries. Argentina and Chile are two big importers of Brazilian products for example.
Sources: Doing Business in Latin America webinar 2021 and Creuza Coehlo
The Caribbean is composed of thirteen independent countries and fifteen dependencies. The population of the Caribbean is close to forty-four million. Languages spoken in the Caribbean include English, French, Dutch, Spanish, and dialects of creole.
Key market sectors attractive for international investment:
- Renewable Energy
- Insurance Services
- Financial Services
- Tourism and eco-tourism
- Medicinal Cannabis
International trading relationships are maximized among Caribbean countries and around the world through trade agreements including CARICOM, established to facilitate regional integration of the Caribbean through economic integration, foreign policy coordination, human and social development, and security. 
There is a new and emerging trading relationship between the Caribbean region and Africa through the respective development banks to facilitate the development of micro, small and medium sized enterprises making the regional economies more resilient and open to encouraging the flow of funds into the region.
In conclusion, the Americas region offers a wealth of commercial opportunities for businesses and investors worldwide and remains an attractive destination for foreign direct investment. Understanding the nuances of each country within the Americas region is crucial for evaluating investment and business opportunities.
View regional case studies
MSI’s 78 member firms throughout North, Central, and South America, as well as the Caribbean, are well-equipped to support clients in navigating the evolving landscape of globalisation and can provide their expertise and assistance to clients. View our selected case studies highlighting the breadth of expertise of our member firms in the Americas.
 Through the CARICOM Single Market and Economy (CSME), there is the right to free movement of goods, services, and human capital. There are also trade agreements with various countries and regions. For example, the Trade and Investment Framework Agreement between the United States of America and CARICOM.