Latin America still offers opportunities

2010 could be the year where the smaller Latin American markets emerge from behind the shadow of their larger counterparts, according to F&C Emerging Equities fund manager Urban Larson.

Larson believes Peru, Chile and even Argentina have the potential to offer opportunities for investors, following signs of economic recovery and growth in most regions over recent months.

"While I remain positive on larger Latin markets such as Mexico and Brazil, I believe that the smaller countries could also present some exciting prospects. Chile was the top-performing Latin market in the fourth quarter 4 of 2009 and is recovering well from the recession.

Moreover, last month saw the election of the country's first centre-right president since the departure of Pinochet in 1990. New president Sebastián Piñera's pledge of structural reforms could be the catalyst which leads to higher long-term growth in the country," he commented.

Elsewhere, Larson is focussing on Peru and Argentina. He believes Argentina offers selective investment opportunities in companies that, while based there, do most of their business internationally, while Peru is particularly attractive as a v-shaped recovery takes hold after a period of disappointing growth between January and September 2009.

At stock level, Larson favours Chilean retailer Falabella, which is in a position to benefit from robust consumer spending in both Chile and Peru, along with Peru's leading bank Credicorp and Argentine/Mexican steel producer Ternium.

Larson concluded: "I remain positive on the long-term outlook for Latin America and believe the majority of the region's markets, small and large, can continue to offer very attractive opportunities for investors this year".