While the Asian and European markets continue their downfall closely following Wall Street, some Latin American markets are glad to show that this crisis has not had such a harmful impact on them as it did elsewhere.
Unfortunately, not only financial organisations have felt the effects of the crisis, but now other companies, such as Marks & Spencer Group plc., British Airways, Indian’s largest zinc producer, Vendanta Resources plc., have suffered a drop in their stock prices of around 5% due to the overall economic downturn. One of the reasons for the drop in stock prices is the concern from financial companies and commodity producers that the US Treasury Secretary Henry Paulson will not be able to deliver his plan. If Mr Paulson’s plan of buying $700bn of bank assets does not take place, global recession will not be able to be prevented.
As mentioned above, there are still some markets that have not been affected to a great extent. In the Latin American region, excluding Mexico, Venezuela and Brazil, there are a few markets that are still stable and rather going up than following the path many markets in the rest of the world have followed. One of the reasons for this could be that the banks of the affected sector at present do not have any specific presence in the Latin American Region. As evidence of this, Citibank is now showing a great interest in increasing its presence across various Latin American countries.
Maybe the financial crisis in the developed world will prove to have a positive effect on less developed regions. This might be the start to a new era of prosperity in a part of the world which still is more or less unexploited by this specific sector. Will these financial institutions have a change of scenery from Canary Wharf and the River Thames to the Andes Mountains and the Amazon River? That is something we will have to wait and see.
Unfortunately, not only financial organisations have felt the effects of the crisis, but now other companies, such as Marks & Spencer Group plc., British Airways, Indian’s largest zinc producer, Vendanta Resources plc., have suffered a drop in their stock prices of around 5% due to the overall economic downturn. One of the reasons for the drop in stock prices is the concern from financial companies and commodity producers that the US Treasury Secretary Henry Paulson will not be able to deliver his plan. If Mr Paulson’s plan of buying $700bn of bank assets does not take place, global recession will not be able to be prevented.
As mentioned above, there are still some markets that have not been affected to a great extent. In the Latin American region, excluding Mexico, Venezuela and Brazil, there are a few markets that are still stable and rather going up than following the path many markets in the rest of the world have followed. One of the reasons for this could be that the banks of the affected sector at present do not have any specific presence in the Latin American Region. As evidence of this, Citibank is now showing a great interest in increasing its presence across various Latin American countries.
Maybe the financial crisis in the developed world will prove to have a positive effect on less developed regions. This might be the start to a new era of prosperity in a part of the world which still is more or less unexploited by this specific sector. Will these financial institutions have a change of scenery from Canary Wharf and the River Thames to the Andes Mountains and the Amazon River? That is something we will have to wait and see.
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