Colombia has emerged as a strategic destination for industrial development, with its network of modern industrial parks playing a central role in attracting manufacturing, logistics, and service companies. These parks are located in key cities such as Bogotá, Medellín, Barranquilla, Cali, and Cartagena, offering global investors access to domestic and regional markets through robust transportation infrastructure, favorable tax policies, and an increasingly skilled labor force. This overview examines Colombia’s most prominent industrial parks, focusing on critical operational factors such as infrastructure quality, labor dynamics, regulatory environment, costs, and business clusters.

Strategic Location and Access to Markets

Colombia’s location on the northern tip of South America bridges North and South American markets, with access to the Pacific and Atlantic Oceans. The most active industrial parks in Colombia are located near major cities and seaports:

• Zona Franca Bogotá: Located near El Dorado International Airport, this park provides direct access to air freight and the Bogotá consumer market. It’s ideal for companies with high-value exports.
• Zona Franca del Pacífico (near Cali): It is near the Port of Buenaventura and has road networks connecting southwestern Colombia and Ecuador.
• Zona Franca de Barranquilla: Strategically positioned on the Caribbean coast, it benefits from access to U.S. and Central American markets through maritime routes.
• Zona Franca La Candelaria (Cartagena): It is near Colombia’s central petrochemical hub and port infrastructure, making it particularly suitable for the energy and chemical industries.

Each park is near major labor pools and suppliers, reinforcing Colombia’s regional integration and supply chain resilience.

Transportation, Utilities, and Connectivity

Colombia has invested significantly in road networks (e.g., the 4G highway program), intermodal terminals, and airport infrastructure. Key industrial parks benefit from:

• Paved highway access to ports and major cities.
• Colombia has fiber optic internet and mobile coverage, and is ranked as one of Latin America’s most digitally connected countries.
• Reliable energy and water services, with parks like Zona Franca del Pacífico boasting uninterrupted power backed by local hydropower sources.
• Telecommunications infrastructure, including 4G and expanding 5G networks in urban-industrial areas.

These infrastructure upgrades support industrial activities, particularly high-tech manufacturing, logistics, and service-based operations.

Labor Availability, Cost, and Training

Colombia has a relatively young and urbanized workforce, with over 70% of the population living in cities. Labor availability is strongest in metropolitan areas, such as Bogotá (population approximately 8 million), Medellín (approximately 2.5 million), and Cali (approximately 2.3 million). Industrial parks tap into these urban labor pools and attract workers from surrounding regions.

Average monthly wages for manufacturing workers range from US $300 to US $500, depending on their skill level and region.

Labor law requires a 48-hour workweek, mandatory social security contributions, and severance pay. Overtime, night work, and holiday shifts incur additional premiums.

Union activity exists, but it is generally more concentrated in the public sector. In manufacturing, collective bargaining is present but does not dominate employer-employee relations.

Access to technical training is robust. SENA (Servicio Nacional de Aprendizaje) offers free vocational training tailored to employer needs, which is present in most industrial regions.

Colombia’s labor structure enables firms to access low— to mid-cost labor and opportunities for skills upgrading through government-backed programs.

Tax Incentives and Regulatory Environment

Industrial parks in Colombia, particularly those with free trade zone (zona franca) status, offer significant regulatory and fiscal benefits:

• Income tax reduction from 35% to 20% for companies located in free trade zones.
• No VAT or customs duties on imported raw materials, capital goods, or intermediate goods used for export.
• VAT exemptions for software and IT services produced within these zones.
• Simplified import/export procedures and customs inspections within park boundaries.

Colombia has steadily improved its Ease of Doing Business score regarding business regulation thanks to streamlined company registration, improved access to credit, and investment protection mechanisms. Foreign companies may repatriate profits freely and are allowed 100% ownership in most sectors.

However, environmental regulations—such as licensing for emissions, water usage, and solid waste—are strictly enforced, especially for manufacturing sectors with high environmental impact. Parks typically support tenants with compliance through in-house environmental departments or external consultants.

Lease Costs, Operating Expenses, and Utilities

Industrial parks in Colombia typically offer Class A and B industrial facilities, including warehouses, build-to-suit plants, and logistics platforms. Average monthly lease costs vary by location and property type:

• Bogotá and Medellín: USD 4–6/m²
• Cali and Barranquilla: USD 3–4.50/m²
• Cartagena (premium port zone): USD 4.50–6/m²

Construction costs for new industrial buildings average USD 500–700/m², with higher-end facilities reaching USD 900/m² for custom build-outs.

Operating expenses include:

• Waste management: USD 0.20–0.50/m²/month
• Facility management: USD 0.40–0.80/m²/month
• Security services: Typically included, but may add USD 0.30–0.70/m²/month depending on surveillance level
• Utilities such as electricity and water are billed at competitive regional rates, with average industrial electricity prices ranging from USD 0.12 to 0.15/kWh.

Logistics and Freight Costs

Colombia’s logistics performance is improving, particularly with the expansion of its intermodal and port infrastructure. Average freight costs for domestic road transport range from USD 0.08 to $ 0.12 per ton/km, depending on the route and carrier.

• From Bogotá to Port of Buenaventura (via Cali): Approx. USD 1,000–1,200 per 20-ton truck.
• From Medellín to Cartagena: Approx. USD 900–1,100 per full truckload.
• Export container rates from Cartagena to Miami: ~USD 2,000–2,400 per 40-foot container (as of early 2025, varies by contract and volume).

Companies in industrial parks near seaports, such as Cartagena, Barranquilla, and Buenaventura, benefit from lower last-mile delivery costs to export terminals. They can leverage Colombia’s free trade agreements (FTAs) with the U.S., the EU, and the Pacific Alliance.

Tenant Mix, Cluster Benefits, and Global Track Record

Each of the leading industrial parks in Colombia features a diverse tenant base and offers cluster advantages:

• Zona Franca Bogotá houses over 400 companies, including international firms in electronics, pharma, and logistics. It’s part of a broader innovation ecosystem in the Bogotá-Sabana corridor.
• Zona Franca del Pacífico supports agro-industrial and light manufacturing firms and is part of the Valle del Cauca cluster, with synergies in food processing and packaging.
• Zona Franca La Candelaria in Cartagena focuses heavily on chemicals and petrochemicals, with key anchors including Ecopetrol and Reficar.
• Ruta N in Medellín and the adjacent industrial districts form a tech and manufacturing cluster that has attracted companies like Hewlett-Packard and Rockwell Automation.

Colombia’s industrial parks have supported expanding companies such as Johnson & Johnson, Bayer, Nestlé, and Unilever. Their presence helps develop value chains, improve supplier quality, and create employment clusters, particularly in the life sciences, electronics, and processed food industries.

Environmental Considerations

While Colombia supports industrial development, it upholds a strict environmental code. Parks must comply with:

• Environmental impact assessments (EIA) before new construction
• Wastewater discharge standards and emission controls
• Reforestation or environmental offsets in some regions

Many parks offer ISO 14001-certified infrastructure and waste treatment facilities, reducing tenant compliance costs and timelines.

Conclusion

Industrial parks in Colombia are key platforms for foreign and domestic manufacturers looking to expand within Latin America. They combine geographic advantages, strong infrastructure, skilled labor, and compelling fiscal incentives. Whether located inland near major cities or in port cities with international shipping access, these parks offer scalability, cost-efficiency, and logistical connectivity. With growing cluster ecosystems and government support for export-driven industries, industrial parks in Colombia are increasingly attractive to global firms seeking stable, competitive, and well-serviced production bases.

As Colombia continues to enhance its investment climate and infrastructure, industrial parks will play an even greater role in its industrial and economic future.

A Dimmer Outlook for Uruguay’s Economic Expansion

The World Bank has revised its economic forecast for Uruguay, projecting a more subdued trajectory over the next two years. In line with recent updates from the International Monetary Fund (IMF), the World Bank’s latest economic outlook highlights growing concern over the Uruguayan growth rate due to external and domestic challenges.

In its most recent update to the Global Economic Prospects report, released Tuesday, the World Bank adjusted Uruguay’s expected gross domestic product (GDP) growth downward for 2025 and 2026. The new forecasts suggest that the country will grow by 2.3% in 2025 and then slow to 2.2% in 2026. These numbers represent a drop from the previously projected rate of 2.6% for both years, which was issued earlier in the year.

This downgrade aligns closely with the IMF’s latest assessment. As of April 23, 2025, the IMF reduced Uruguay’s 2025 growth projection from 3% to 2.8%. While slightly more optimistic than the World Bank’s forecast, the IMF’s move underscores the mounting headwinds facing the small but economically stable South American nation.

Regional Trends and Comparative Growth

The revision of the Uruguayan growth rate comes amid a wider reassessment of growth prospects across Latin America and the Caribbean. While Uruguay has long been viewed as one of the region’s most stable economies, it is not immune to the broader dynamics shaping global trade, consumption, and investment trends.

According to the World Bank, regional growth in Latin America is expected to reach just 2.1% in 2025. This figure, although modest, is buoyed by expectations of a strong rebound in Argentina, which is forecasted to grow by an impressive 5.5% in 2025 and 4.5% in 2026. This Argentine resurgence is primarily attributed to aggressive economic restructuring policies and stabilization measures undertaken in recent years.

In contrast, other large regional economies, including Brazil, Mexico, and Colombia, are expected to experience more tepid growth. Structural bottlenecks, high inflation, and fiscal pressures remain significant obstacles to sustained growth.

Domestic Sentiment and Analyst Reactions

The World Bank’s lower growth projections for Uruguay have fallen short of expectations held by domestic analysts. According to the most recent survey by the Central Bank of Uruguay (BCU), the average growth forecast for 2025 stood at 2.5%. This is higher than the World Bank’s 2.3% projection, indicating that local economists may have a more favorable view of the country’s internal fundamentals.

Nonetheless, some analysts have acknowledged that mounting external pressures—from global monetary tightening to trade volatility—may begin to weigh more heavily on Uruguay’s growth rate in the coming quarters.

An Uncertain Global and Regional Environment

The outlook for Uruguay, and indeed much of Latin America, is being shaped by a confluence of external uncertainties. The uneven global recovery from the COVID-19 pandemic and subsequent geopolitical disruptions are chief among these. While consumption drove growth across much of the region in 2024, countries like Argentina and Chile saw their economic performance hinge more heavily on external trade.

At the same time, output growth among Uruguay’s primary trading partners remained lackluster. The G7 economies, for instance, are projected to grow by only 1.2% in 2025, reflecting economic deceleration in the United States and continued stagnation in parts of Europe. Meanwhile, economic growth in China—a major importer of Latin American commodities—is expected to remain subdued, adding another layer of complexity for countries dependent on export-driven revenue.

These global factors are critical to understanding the recalibrated Uruguayan growth rate, as Uruguay’s economy is closely integrated with international markets through agriculture, energy exports, and financial services.

Trade Policy and Nearshoring Shifts

The World Bank’s report further emphasized that rising global trade policy uncertainty significantly shapes the economic prospects for Uruguay and its neighbors. The report notes that the trade policy uncertainty index has increased and remains persistently above pre-2015 levels.

Much of this uncertainty stems from protectionist policies and the evolution of global supply chains. Major economies such as the United States, the European Union, and China have either implemented or are considering new tariffs and non-tariff barriers, which could impact Uruguay’s export competitiveness.

Additionally, the nearshoring trend—where companies relocate their supply chains closer to their home markets—could realign trade and investment flows across the Western Hemisphere. While this could create new opportunities for countries like Mexico and Costa Rica, Uruguay might face challenges if multinational firms shift attention away from South America’s Southern Cone.

Weather, Infrastructure, and Other Risks

Beyond international concerns, Uruguay also faces domestic risks that could affect the Uruguayan growth rate. Agriculture remains a vital component of the nation’s economy, and adverse weather patterns, including prolonged droughts or floods, can disrupt production and exports.

Infrastructure limitations, particularly transport and logistics, could hinder growth if not addressed through targeted investment. Additionally, while Uruguay has a reputation for political stability and institutional strength, it must continue to modernize its regulatory framework and attract foreign direct investment (FDI) to maintain its competitiveness.

Policy Responses and Future Prospects

In response to these evolving challenges, Uruguayan policymakers will likely consider a range of measures to stimulate economic activity. These include reforms to improve labor market flexibility, public-private partnerships for infrastructure, and enhanced incentives for technology and innovation sectors.

The country’s renewable energy sector, one of the most advanced in Latin America, also presents an opportunity for sustainable long-term growth. By leveraging green energy assets and expanding digital services, Uruguay could strengthen its resilience against external shocks and secure a more favorable Uruguayan growth rate over the next decade.

Conclusion

Although Uruguay continues to enjoy relative economic and political stability, the revised forecasts from the World Bank and the IMF underscore a period of caution and recalibration. The downward revision of the Uruguayan growth rate for 2025 and 2026 reflects broader uncertainties in global markets, trade policy, and regional vulnerabilities.

Uruguay must adapt to a rapidly changing international landscape while reinforcing its domestic strengths. How well it navigates this transitional period will determine whether it can regain momentum and achieve higher, more inclusive growth in the years ahead.

A Quarter Century of Growth and Development

For the past 25 years, Paraguay has maintained a robust and forward-looking maquila regime, established under Law 1064 of 1997, “On the Export Maquiladora Industry,” and further regulated by Decree 9585 of 2000. This legal framework has provided a solid foundation for the country’s export-oriented manufacturing model. Known locally as the Maquila Regime, the system was designed to promote foreign investment, industrial activity, and economic development by facilitating the establishment and operation of maquiladora companies in Paraguay.

The maquila model in Paraguay refers to an investment regime in which foreign companies or Paraguayan firms primarily process goods or services for export. These goods are value-added within Paraguay, which increases their international competitiveness and contributes significantly to the local economy. In doing so, the maquila regime has proven to be a cornerstone of the country’s broader development strategy.

Maquila as a Catalyst for Economic Diversification

Since its inception, the maquila regime has become an effective and strategic tool for diversifying Paraguay’s economic base, which has traditionally relied on agricultural exports, particularly soybeans. While agriculture will continue to be a major contributor to GDP, the future of the Paraguayan Maquila industry lies in its capacity to balance the national economic portfolio and shield it from the volatility associated with global commodity prices and climatic disruptions.

Today, Paraguay’s maquila sector is a growing contributor to national exports. In 2024 alone, the sector closed the year with exports totaling $1.15 billion, representing approximately 50% of the country’s soybean exports —a remarkable milestone underscoring its increasing relevance.

Job Creation and Workforce Development

One of the most compelling features of the maquila industry is its job creation potential. Currently, the sector provides approximately 32,500 direct jobs, many of which offer on-the-job training and opportunities for skill development. For a country like Paraguay, where the population is predominantly young, this represents a vital opportunity to channel youthful energy into productive economic activities.

The future of the Paraguayan maquila industry will heavily depend on the country’s ability to cultivate a well-trained, dynamic workforce. This requires joint efforts by the public and private sectors to invest in education, technical training, and policies that foster innovation. Workforce development programs must be tailored to meet the evolving needs of an industry that is becoming increasingly tech-driven.

Fiscal Incentives and Competitive Advantages

Paraguay’s maquila sector benefits from a series of attractive fiscal incentives, making it highly competitive in the region. These include tax exemptions, a single-tax system (with a flat 1% tax on value-added), tariff elimination on imported inputs, and duty-free repatriation of profits. These features create a business-friendly environment that has drawn the attention of investors from diverse sectors, including automotive, textiles, electronics, and services.

Yet, the long-term future of the Paraguayan maquila industry will also depend on continued institutional support and regulatory stability. Investors seek predictability, and a consistent legal and policy framework will play a critical role in encouraging sustained foreign direct investment (FDI).

The Role of Energy and Industrial Hubs

Paraguay is blessed with abundant, renewable hydroelectric energy from the Itaipú and Yacyretá dams. This clean energy resource reduces manufacturers’ production costs and aligns Paraguay with the global shift toward sustainable production. Paraguay’s energy matrix becomes a strategic asset as the world increasingly prioritizes low-carbon and eco-friendly supply chains.

Leveraging these energy advantages, Paraguay has the potential to evolve into a significant industrial hub in South America. The maquila sector serves as a vital stepping stone toward this goal. The future of the Paraguayan Maquila industry must be aligned with broader national objectives to enhance infrastructure, improve logistics networks, and develop industrial parks that can accommodate larger, more complex manufacturing operations.

Exploring New Markets and Innovation

At its recent 25th anniversary celebration, the Paraguayan Chamber of Maquiladora Companies (CEMAP), under the leadership of President Carina Daher, emphasized the importance of expanding into new international markets and investing in technological innovation. These twin goals are crucial for securing the long-term competitiveness of Paraguayan-made products.

To achieve this, greater emphasis must be placed on market diversification strategies and quality certification systems that meet international standards. The public sector can support this through export promotion programs, bilateral trade agreements, and diplomatic efforts to open new commercial opportunities.

Incorporating new technologies, particularly Artificial Intelligence (AI), into maquila operations is another frontier. AI can improve supply chain efficiency, streamline production processes, and enhance product quality. This makes it imperative for government-led training programs to include AI literacy and digital skills development as core components. Indeed, the future of the Paraguayan Maquila industry may be defined as much by its ability to embrace innovation as by its cost competitiveness.

Policy Support and Social Responsibility

Government support will be essential in fostering a favorable environment for the maquila sector. Beyond tax incentives, the state must develop and implement policies that support inclusive industrial growth, focusing on job creation, environmental responsibility, and technological readiness.

Additionally, the social role of the maquila industry must not be underestimated. It offers stable employment opportunities, particularly in regions with limited formal job creation. For many Paraguayans, maquila jobs represent a gateway to financial stability and upward mobility. Therefore, protecting and growing this sector contributes to economic and social development.

A Vision for the Future

Looking forward, Paraguay stands at a strategic crossroads. It has the opportunity to build on the successes of the past 25 years and move toward a more industrialized and diversified economy. The maquila sector is uniquely positioned to lead this transformation. But for this to happen, visionary leadership, proactive policymaking, and collaborative action from all stakeholders must occur.

If these elements come together, the future of the Paraguayan Maquila industry could serve as a model for other emerging economies seeking to balance industrial growth with social inclusion and sustainability.

Conclusion

The maquila industry in Paraguay is more than just an export mechanism—it is a key pillar of national development, offering a viable path toward industrialization, job creation, and global economic integration. With the right investments in training, innovation, and infrastructure, the future of the Paraguayan Maquila industry looks promising. However, continued success will depend on how well the country navigates emerging challenges and leverages its strengths to build a resilient, forward-looking manufacturing sector.

A Strategic Boost to the Automotive Sector

Volvo is showing its strong long-term dedication to North America by expanding its operations in Mexico with a significant new investment. The Volvo investment in Mexico will rise from $700 million to $1 billion when it builds an advanced truck manufacturing facility in Ciénega de Flores, Nuevo León. Mexico emerges as a crucial automotive supply chain center following confirmation by the Secretary of Economy Marcelo Ebrard.

This development symbolizes a decisive turning point for Mexico’s automotive sector beyond its economic investment. The establishment of this new plant signifies an important achievement that will strengthen industrial production while making a major impact on the regional economy and society.

Focus on Freight Trucks for North America

Volvo’s upcoming Nuevo León site will focus its production on freight trucks which serve as essential components for logistics and trade throughout North America. The facility set to launch operations in 2026 will produce 25,000 units annually. This facility will exceed Volvo’s production levels at Canadian plants, which demonstrates Mexico’s strong position as a manufacturing hub.

The plant’s strategic positioning near the U.S. border makes it the perfect location to supply customers across the U.S., Mexico, and Latin America. The Volvo investment in Mexico helps achieve its objectives of improved efficiency and market proximity while enhancing supply chain resilience.

The Project Will Drive Economic Development and Employment Opportunities

The project delivers quick and noticeable benefits through its ability to create jobs. The anticipated operation of the plant will create around 2,500 direct positions alongside thousands more indirect jobs in supply chain and service-related industries. The rise in employment will generate a chain reaction throughout the local economy that will drive the need for more housing, transportation and educational services.

The surrounding municipalities, including Ciénega de Flores, are expected to experience a rapid expansion of infrastructure development. The new workforce and industrial activities require local governments to make investments in roads, utilities, and public services. The Volvo investment in Mexico generates additional benefits for urban planning and regional development through these progressive developments.

Leveraging Mexico’s Competitive Advantages

Due to increased protectionism with the U.S. as a key player and sustainable development trends, Volvo has made a decision that reflects shifts in global automotive strategies. Mexico stands out as an attractive industrial investment destination within this framework.

Several factors contribute to this favorable outlook. The United States-Mexico-Canada Agreement (USMCA) combined with skilled labor availability and geographic closeness to the U.S. market positions Mexico as an attractive manufacturing destination. The decision of Volvo investment in Mexico was made based on competitive advantages that enable adherence to USMCA rules of origin while eliminating costly tariffs.

Driving Sustainability in Manufacturing

Volvo follows the trend of making sustainability a fundamental aspect of corporate strategy. The company has declared that its new Nuevo León facility will target LEED Gold environmental certification, which represents a worldwide standard for sustainable building design and operation.

The manufacturing facility will incorporate design elements to lower energy use and emissions while implementing green materials and technologies. Volvo incorporates sustainability into its fundamental operations to meet regulatory standards and consumer demand for eco-friendly products. The Volvo investment in Mexico demonstrates its dual focus on economic profitability and environmental stewardship.

This Announcement Signifies Volvo’s Belief in Mexico’s Economic Stability and Future Market Potential

The Volvo announcement shows strong belief in Mexico’s future economic stability and market potential from a geopolitical and financial standpoint. The recent years have seen global investors voice their worries about changing trade patterns and increasing risks in operations. Mexico has shown resilience and adaptability by preserving strong trade partnerships and upgrading its industrial infrastructure.

The Volvo investment in Mexico validates the country’s standing as a dependable and progressive partner for international businesses. Mexico stands to gain from nearshoring trends that push firms to move production nearer to significant consumer markets.

Mexico Presents a Compelling Approach for Future Regional Investment Initiatives

The expansion plans of Volvo in Nuevo León may act as a strategic model for foreign companies aiming to diversify their manufacturing locations. Mexico delivers logistical benefits along with skilled workforce and cost-effective production while providing unmatched trade advantages that other regions cannot replicate.

Volvo’s dedication to sustainable practices and social responsibility establishes a leading example of corporate conduct within the region. The Volvo investment in Mexico demonstrates how multinational corporations can synchronize their profit objectives with wide-ranging social and ecological goals to facilitate equitable and sustainable development.

Strengthening Volvo’s Competitive Edge

From a business strategy perspective, the newly established plant enhances Volvo’s stability and presence in North America. Regional production enables the company to fulfill market demand more efficiently while minimizing shipping duration and adhering to USMCA local content regulations.

Volvo’s move allows the company to reduce potential overseas manufacturing challenges like trade tariffs as well as logistical delays and political instability. The Volvo investment in Mexico enables the company to enhance both agility and cost-efficiency by producing closer to its main customer base, which are vital elements in the automotive industry’s competitive environment.

Looking Ahead

As operations are set to begin in 2026 the massive investment generates growing anticipation about its wider effects. The impacts of this initiative on regional growth and labor market trends together with sustainable manufacturing practices in Mexico will be monitored by industry analysts and government officials as well as business leaders.

The project stands to launch high-tech and eco-friendly manufacturing in northern Mexico while strengthening Mexico’s status as a leading automotive nation. The Volvo investment in Mexico represents more than just an industrial facility because it showcases the nation’s ability to compete internationally while evolving and achieving success.

The foreign direct investment environment in Latin America continues to change and presents multiple complexities. Certain countries in the region show promise because of their economic potential and natural resources, together with skilled labor forces, but other countries face challenges that undermine investor confidence. The best countries to invest in Latin America often exhibit a blend of macroeconomic stability, export diversification, and a strong institutional framework. Brazil and Mexico continue to be the top investment destinations in Latin America, according to the 2025 Foreign Direct Investment Confidence Index from Kearney. The global rankings for both Brazil and Mexico decreased when compared to their positions in the previous year. The only regional country to show progress was Colombia, which reflected a change in investor outlook.

Latin America’s Top Investment Destinations in 2025

Investors view Brazil and Mexico as the best countries to invest in Latin America in 2025, although both countries experienced decreases in their international rankings. The Kearney index rankings for the top 25 FDI destinations saw Brazil fall to 21st place from its previous year ranking, while Mexico reached its lowest ranking at 25th.

Both nations maintain their appeal to investors because of their sizable domestic markets alongside their abundant resources and established manufacturing sectors. Global investors appear to focus more on political stability and regulatory reliability than market size alone when evaluating potential investment opportunities.

The Rise of Colombia

Colombia emerged as the sole Latin American country to advance in this year’s Kearney ranking by reaching the 20th position. This positive shift demonstrates increased investor trust in Colombia’s economic strategies and infrastructure modernization initiatives. The advancement of Colombia proves that maintaining steady policies along with economic changes can create major positive outcomes even when regional conditions are challenging.

According to Kearney’s analysts, developed markets hold 19 out of the top 25 positions in global rankings which indicates investor preference for established market stability during times of geopolitical and economic uncertainty. Colombia’s rising position signals that the best countries to invest in Latin America are not always the largest markets, but those making strategic reforms and modernizing infrastructure.

Argentina and the Emerging Market Index

Argentina has dropped out of the top 25 global index but still maintains a strong ranking in Kearney’s 2024 list of attractive emerging markets for investment. Argentina holds the ninth position in this subset and continues to attract investors looking for high-risk investment opportunities with potential high rewards. The nation’s unstable economy, alongside its changing regulations, persist as obstacles that prevent progress.

Chile (15), Costa Rica (23), Peru (24), and Uruguay (25) appeared lower on the emerging market index in comparison to Argentina, which shows wider investment competition among Latin America’s secondary markets.

Factors Driving Investment Decisions

According to the report, two factors dominate investor considerations when evaluating where to allocate foreign direct investment: Investors prioritize national economic performance and the efficiency of legal and regulatory processes when choosing investment destinations. The criteria that guide investment behavior demonstrate that investors seek stable institutions and strong economic foundations along with transparent legal frameworks.

Kearney’s analysis reveals that nearly half of the leading investment destinations attribute their appeal to strong economic performance. GDP growth, along with low inflation and sound fiscal policy, stand out as essential factors for attracting global capital flows.

Growing Investment Risks

Various Latin American countries have improved their appeal to international investors, but they also encounter external risks that could obstruct investment inflows. Global investors in 2025 face significant challenges due to increasing commodity prices together with expanding geopolitical tensions.

According to the survey results, 38% of respondents think that increased commodity prices will be the most probable global situation next year. The percentage of respondents who predict increasing geopolitical tensions reached 35%, which demonstrates a seven-point increase from 2024. Emerging markets face heightened uncertainty since their dependency on commodity exports leaves them susceptible to global supply chain disruptions and political instability. 

Brazil: Still the Regional Powerhouse

Brazil maintains its reputation as the leading nation in its region and remains a top investment choice for investors looking at Latin American markets, despite its recent minor drop in global rankings. Mark Essle from Kearney Brazil states that the country’s ranking drop remained minor because of statistical modifications. Brazil achieved better performance than Mexico while also outperforming India and multiple other emerging economies.

According to Essle, Brazil’s appeal stems from its varied economic capabilities. The nation possesses abundant natural resources, which support prominent mining and agricultural industries. Brazil stands out as a worldwide front-runner in renewable energy and carbon-based economic initiatives, which makes it more appealing as sustainability becomes a global priority.

According to Essle, Brazil attracts international attention for its massive consumer market and attractive investment opportunities, which span both established businesses and new projects. Foreign investors remain attracted to Brazil’s vast territory and future opportunities despite ongoing governmental disagreements about fiscal strategy. Among the best countries to invest in Latin America, Brazil continues to offer scale, diversity, and a pathway toward green economic growth.

A Favorable Business Environment

In addition to its natural resources, Brazil possesses multiple factors that establish its status as one of the best countries to invest in Latin America. These include:

• A relatively skilled labor force.
• The regulatory system provides uniform treatment to both domestic and foreign investors.
• Improving infrastructure and logistics capabilities.

The economy comprises sectors such as manufacturing along with services, energy production, and technological development.

Kearney’s evaluation reveals that these strengths establish Brazil as one of the leading five countries within emerging markets.

A Historic Return to the Rankings

After being absent for 25 years, Brazil reappeared on the FDI Confidence Index starting in 2024. Despite not regaining its early 2000s top-tier status yet, staying listed shows ongoing global investor interest.

Brazil shows that strategic assets and improving governance enable a large market to maintain international capital relevance despite economic and political complexities.

The Broader Latin American Context

Latin America stands out as a region of contradictions amid ongoing changes within the global economy. Certain nations are becoming dependable targets for foreign direct investment, while others face difficulties in sustaining stable economic policies. The best countries to invest in Latin America share common traits: strong economic resilience, clear regulatory transparency, and access to essential markets, while also aligning with progressive global trends including digital transformation and decarbonization efforts.

While Brazil, Mexico, and Colombia receive attention, Chile, Peru, and Costa Rica are building competitive advantages through sustainable practices, innovation, and export diversification. Investors looking for opportunities in Latin America will probably continue to assess companies based on quality and predictability reasons, aside from size alone.

Looking Ahead

Brazil, Mexico, and Colombia represent the best countries to invest in Latin America for 2025 due to their distinctive value propositions in a challenging global market. The Kearney index performance demonstrates the potential opportunities and existing challenges of the Latin American region.

The changing landscape of global economic conditions coupled with rising geopolitical tensions leads investors to monitor Latin America’s leading markets closely. In the upcoming years, regional nations must strengthen legal certainty, improve infrastructure, and expand regional integration, which serve as essential steps to achieve better standings in future international investment rankings.