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South America – Is Latin America the new Asia?

29 October 2013

Whilst most recruitment companies have traditionally favoured Asia for overseas expansion, Latin America is increasingly being viewed as a viable option. That’s according to the recent Rest of the World forum hosted by APSCo and sponsored by Goldenhill International, which informed staffing companies about opportunities for expansion in the region.

The event, which was held at the Colombian Consulate-General, featured an overview of the region’s economy from Neil Wynn Jones, of UK Trade & Investment. Mr Jones’ presentation had a particular focus on the opportunities within Chile and Colombia - two countries which could be particularly attractive to recruiters in the coming years.

Mr Jones noted that Chile had enjoyed a +5.5% GDP growth, due to its prolific mining trade and strong links with China.  Colombia also presented an opportunity, as it has recently been named by The Economist as one of the CIVETS nations (along with Indonesia, Vietnam, Egypt, Turkey and South Africa), a list of economies that are emerging as powerful after the BRIC nations.

The forum continued with a presentation from Herman Santiago of Nabas Legal, who highlighted some key legal and tax issues that companies wishing to expand would have to consider. First and foremost is an understanding of the labour regulations that can differ across the region. In Brazil, for example, there is not only a legal limit of 44 hours per week, but also above average notice periods, which are strictly enforced.

Commenting on the event APSCo’s Marilyn Davidson says: “What is clear from the Rest of the World forum is that, whilst many companies are looking towards Asia for expansion, there are many opportunities within the Latin American market. The key thing is to truly understand both the culture and the economy of a country before expanding there, rather than applying knowledge and experience of the British market to replicate past success. Taking this into account, this could be a very exciting time for the recruitment sector in South America.”  

APSCo Chair, Miles Hunt, concluded the event with an insight into his first-hand experience of setting up a recruitment business in South America. One of the main challenges highlighted was the fact that, due to the relative immaturity of the recruitment market, administrative matters can take longer to be resolved than in Europe.

Despite this, however, Mr Hunt stressed that these emerging nations were very keen to engage with foreign ideas, technology and sophistication. Chile, in particular, was highlighted due to its highly educated workforce, as well as the opportunities for niche recruiters. Something which, until recently, has been a challenge due the polarised nature of the sector.

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