A New Chapter in Bilateral Scientific Collaboration

The recent state visit of Uruguay’s President Yamandú Orsi to China marked a significant milestone in bilateral relations, particularly in agricultural biotechnology, scientific research, and innovation. As global demand for food security, sustainable agriculture, and advanced biotech solutions continues to rise, partnerships between technologically advanced nations and resource-rich agricultural producers are becoming increasingly strategic. In this context, China and Uruguay cooperate to accelerate innovation across agriculture, livestock, biotechnology, and nanomedicine—areas that could reshape productivity, competitiveness, and scientific capacity in both countries.

Why Agricultural Biotechnology Matters for China and Uruguay

China is currently the world’s largest consumer of livestock and forage products, with rising demand driven by population growth, dietary changes, and urbanization. To ensure food security, China is diversifying its import sources and strengthening international agricultural partnerships. Uruguay, meanwhile, stands out as a global agricultural producer with:

• Extensive pastureland
• A strong cattle and dairy industry
• High-quality genetic livestock resources
• A reputation for traceability and food safety

These strengths make Uruguay a strong partner for China’s efforts to modernize its agriculture.

“Uruguay is a country with a great wealth of natural resources that must be leveraged with advanced technology,” said Lucas Borchardt, CEO of Reevolution.

Establishing a Joint Agro-Livestock Laboratory

One of the most notable outcomes of the visit was the signing of an agreement to create a joint agro-livestock research laboratory between:

• Qingdao Agricultural University
• Vland Biotech (China)
• Uruguay’s National Institute of Agricultural Research (INIA)
• Reevolution (Uruguay)

The laboratory aims to turn traditional livestock systems into modern, data-driven, and high-value production models.

Key Research Areas

The joint laboratory will prioritize:

• Grass seed innovation to improve pasture productivity
• Smart livestock technologies for monitoring animal health and productivity
• Precision disease prevention and control systems
• Development of premium dairy and meat products derived from pasture-based systems
• Introduction of high-quality plant and animal genetic resources

This project moves beyond simple academic exchange and focuses on combining research, production, and real-world use.

“Our institution has global leadership in improving pasture quality and efficiency,” explained Professor Sun Juan from Qingdao Agricultural University.

Technology Transfer and Smart Livestock Production

A critical component of the collaboration is technology transfer. China plans to provide Uruguay with advanced solutions in:

• Healthy breeding technologies
• Smart herd management systems
• Deep processing of pasture-based livestock products
• Digital monitoring tools and AI-driven livestock analytics

Uruguay’s agricultural sector has shown a clear need for new ideas, especially in processing and creating higher-value products. By working with China, Uruguay aims to go beyond just exporting raw goods and develop more advanced, technology-driven agribusiness.

Potential Impact on Uruguay’s Agricultural Sector

Experts anticipate that the partnership could transform Uruguay’s livestock industry by enabling:

• Higher productivity per hectare
• Improved genetic breeding programs
• Enhanced traceability and quality control
• New premium export categories for Asian markets
• Increased integration into global agricultural innovation networks

Borchardt said that working together on genomic analysis, pasture improvements, and seed development can benefit both countries and speed up scientific progress.

Expanding Collaboration in Vaccine Production

The Uruguayan delegation also visited Vland Biotech’s research laboratories and vaccine production facilities, highlighting interest in scaling vaccine manufacturing.

Agustín Correa Bove, CEO of Scaffold Biotech, noted:

“We are expanding vaccine production, and finding a partner like Vland is essential to accelerate this process.”

This partnership could help Uruguay’s pharmaceutical and veterinary biotech industries grow and improve disease prevention for both livestock and public health.

Joint Nanobiotechnology and AI Research Platforms

Beyond agriculture, the partnership extends into cutting-edge biomedical and nanotechnology research. The University of Qingdao and the University of the Republic of Uruguay signed a memorandum to establish a joint pharmaceutical bionanotechnology laboratory.

Planned Research Platforms Include:

• Biological nanomaterial design and intelligent synthesis
• Biomedical big data and AI computing platforms
• Functionalized nanomedicine preparation and precision delivery systems
• Nanomedicine product development and commercialization platforms

The goal is to build an international center that draws top scientists and speeds up the sharing of new technology. By working together in nanomedicine, China and Uruguay cooperate and hope to lead in smart biomedical innovation.

Artificial Intelligence in Oral Pathology

Another advanced collaboration involves the Faculties of Dentistry at both universities, which agreed to establish a joint laboratory focused on AI-driven oral pathology. The initiative aims to:

• Develop AI models for digital histopathology
• Create interoperable and standardized clinical databases
• Improve diagnostic accuracy through machine learning

This partnership shows how bilateral cooperation is expanding beyond agriculture into advanced healthcare technologies.

From Academic Exchange to Integrated Innovation Networks

Historically, collaboration between China and Uruguay began with academic exchanges and joint research projects. Today, it is evolving into a multidimensional innovation ecosystem involving:

• Universities
• Private biotechnology companies
• Government research institutions
• Industrial partners

This combined approach helps both countries bring scientific discoveries to market more quickly and build stronger innovation skills. China and Uruguay cooperate and are also working with other countries in the Belt and Road Initiative, expanding their research worldwide.

Economic and Trade Relations: A Growing Partnership

The scientific partnership is supported by a rapidly expanding economic relationship. Since establishing a comprehensive strategic partnership in 2023, bilateral trade has grown steadily.

Key Trade Highlights

China has been Uruguay’s largest trading partner for several consecutive years. In 2025, bilateral trade reached $7.19 billion, up more than 9% year over year.

Uruguay exports:

• Beef
• Dairy products
• Wine
• Soybean meal
• Rapeseed meal

China exports:

• Automobiles
• Household appliances
• Consumer goods

These trade exchanges give Chinese consumers access to high-quality farm products and help improve living standards in Uruguay by making manufactured goods more affordable.

Strategic Implications for Global Agriculture

The collaboration reflects broader global trends:

• Rising demand for sustainable agriculture
• Increasing role of AI and biotechnology in food production
• Growing South–South and South–North scientific partnerships
• Integration of digital technologies in livestock and crop managemen

By combining China’s technological expertise with Uruguay’s agricultural resources, both countries are positioning themselves as leaders in next-generation agri-biotech innovation.

Opportunities for Investors and Industry

The expanding partnership opens new opportunities for:

• Agribusiness companies
• Biotechnology firms
• Venture capital investors
• Universities and research institutions
• Startups in AI, genomics, and agricultural technology

Joint labs and innovation platforms open doors for new business, partnerships, and technology sharing. The way China and Uruguay cooperate and are working together could bring global investment into agricultural tech centers in both countries.

Looking Ahead: A Model for Future Bilateral Innovation

As China and Uruguay commemorate 38 years of diplomatic relations in 2026, their partnership is shifting from traditional trade toward a knowledge-based, innovation-driven alliance. Key future priorities include:

• Expanding joint research programs
• Scaling industrial applications of biotech innovations
• Training and exchanging scientific talent
• Strengthening digital infrastructure for smart agriculture
• Developing joint standards and regulatory frameworks

By combining science, trade, and strategic diplomacy, this partnership serves as a model for other countries that want to modernize their agriculture and biotechnology sectors.

Conclusion: Building a High-Tech Agricultural Future

The recent agreements are more than just symbolic—they mark a real shift toward working together on technology and the economy. The partnership now covers smart livestock systems, advanced vaccines, AI-based diagnostics, and nanomedicine. By joining natural resources with new technology, China and Uruguay are setting an example for sustainable farming, scientific achievement, and global competitiveness. Their teamwork demonstrates how international partnerships can accelerate progress and economic growth in today’s world.

High-Growth Sectors in Latin America: How Demographic Change is Redefining Goods and Services

A growing number of companies and organizations across Latin America are expanding the range of services they offer or pivoting their business models to better serve the region’s changing demographics. Increasingly, goods and services are demanded by an aging population, making the silver economy one of the most promising high-growth sectors in Latin America.

Latin America’s Silver Economy

In Latin America, goods, services, and solutions that target the population of adults 60 years or older are commonly known as the “silver economy.” A mapping study by the Inter-American Development Bank (IDB) identified at least 245 actors spread across 24 countries developing initiatives and solutions in sectors such as:

• Health and long-term care
• Housing
• Digitalization
• Employment

The study from IDB says that this segment, which has grown considerably since the pre-pandemic years of 2020, has the potential to become “an opportunity for innovation and business development that will generate jobs and income while contributing goods and services that improve quality of life and well-being for older adults.”

Approximately 90% of these actors only operate in their home country, a detail that suggests how scaling companies that have found success in their local markets can be just as challenging as meeting the demand of growing in-market consumers.

“At the start of a new decade, it is clear that the silver economy not only allows us to meet the demand of this population group. With well-planned public policies, it is possible to leverage this sector’s growth to benefit society as a whole,”- IDB.

Sector Breakdown & Who’s Who

40% of actors identified in the IDB were concentrated in the Health sector, specifically long-term care and elderly care services. This can be both a reflection of the number of small providers within the market, as well as seniors not yet being as engaged within Latin America’s consumption, investment, and job markets compared to other sectors of the population.

Interesting data points about the silver economy:

• 3 out of 4 organizations work for profit
• 20 startups
• 98 SMEs
• 29 large companies

NGOs, foundations, universities, government institutions, and associations are also present, creating a hybrid network of public and private stakeholders looking to meet the demands of the region’s silver economy. These stakeholders show just how much the silver economy has grown from fragmented care options to a holistic network impacting goods and services offered throughout Latin America.

Highlighted sectors and companies include:

• Digital health solutions
• Senior housing
• Job and professional integration platforms
• Financial products
• Services specifically designed for older adults
• Government institutions coordinating policies

Health: Prevention and Chronic Illness

RAFAM International (Argentina) developed care programs that specialize in sports, active aging, and healthy aging programs for adults and seniors. RAFAM works with partners across 14 countries.

Diabetes and retinopathy prevention

TeleDx is a Chilean startup that creates automated retinography diagnostics using artificial intelligence. Their solution has been nationally deployed as a standard public health solution. TeleDX’s solution allows for scalable diabetic retinopathy screenings for patients.

Home care services

Bonanza Asistencia provides home care services and has become the gold-standard in Costa Rica with over 8,000 adults over age 60 in their care in recent years.

Senior real estate & nuda propiedad

NudaProp focuses on “nuda propiedad” in Uruguay. Or in English, when seniors sell their property but retain the usufruct for the rest of their lives.

Senior employment: Connections and platforms

Maturi Brazil’s leading employment network for professionals over 50. They’ve connected close to 140,000 workers with jobs and training.

Contraticos is similar to Maturi but based out of Costa Rica, providing professional reintegration services in various sectors.

Someone Somewhere is bridging the gap between older women in Mexico’s indigenous community and dignified work. Through the creation and sale of textiles, Someone Somewhere has provided tools for economic empowerment.

CONAPE is a leader in institutional solutions. This Dominican Republic-based institution, known as CONAPE (Spanish for Council for the Elderly), is the National Council for the Elderly and works to develop policies and programs focused on inclusion and protection for older adults.

Silver economy in digital transformation

Latin American markets and entrepreneurs are developing organizations and programs centered around technology and digital inclusion for silver economy consumers.

Digital Tablet Distribution

Plan Ibirapitá — with over 230,000 tablet giveaways to older adults — is another prime example of technology providing seniors with access to bilingual digital literacy courses at no cost.

Senior Oriented E-Commerce Portal

Canitas was founded in Mexico by serial entrepreneur Joaquín Suárez. Canitas serves as a one-stop-shop for providers offering healthcare, entertainment, service, and leisure goods to seniors and their families. “We want Canitas to become the national and continental benchmark in the sector,” says Suárez. Canitas will play a central role in our research by connecting us to startups, organizations, and business owners operating in the silver economy.

Education & empowerment

Fundación Saldarriaga Concha was founded in Colombia. Fundación Saldarriaga Concha creates opportunities for education, well-being, and income generation for vulnerable groups focused on autonomy and empowering citizens to advocate for public policies that improve the lives of older adults.

Silver Economy Trends in Latin America

The IDB shares the following trends about Latin America’s silver economy:

• Private investment: Most capital for businesses within the silver economy comes from domestic private investment, not international markets.
• Low internationalization: Few companies have been able to scale out of their home countries, suggesting high growth potential for companies that can expand — a clear indicator of high-growth sectors in Latin America.
• Slow legislation: Healthcare, job market, and housing legislation is very complex in Latin America, preventing the silver economy from growing at faster rates.
• Digital & gender inclusivity: As the silver economy grows, there is a greater focus on developing programs for women, who statistically still shoulder the largest burden of unpaid caregiving work.

The silver economy as an economic opportunity

Besides providing services that are increasingly in demand, by 2030, newly considered adults 60 and over will modify how goods and services are purchased in Latin America. Representing an opportunity for companies to serve this new market by:

• Creating training programs for professional caregivers
• Developing senior-focused financial products (i.e., Savings, Insurance, Investments)
• Helping transform the Latin American housing market
• Bridging stakeholders between startups, universities, and government entities to scale ideas and solutions

Latin America Goods and Services

Over the next decade, companies and institutions within Latin America will be forced to consider how goods and services can accommodate the region’s fastest-growing market. By diversifying their service offerings and creating sustainable business models that consider a silver-aged consumer, they can become a market leader within:

• Healthcare
• Financial services
• Housing
• And more

By putting measures in place to prepare for Latin America’s demographic shift, companies can be part of one of the region’s highest-growth industries in the coming years, firmly establishing themselves among the high-growth sectors in Latin America.

The Dominican Republic continues to attract leading multinational companies and advance its position as a premier destination for advanced manufacturing and logistics with the launch of the Savanna Free Zone Park, located in Boca Chica. The park will sit alongside Las Américas International Airport and port facilities in Caucedo.

“Our vision is for Savanna Free Zone Park to write the next chapter in Dominican industrialization,” said Eduardo Sanz Lovatón, Minister of Industry, Commerce, and MSMEs. “This project will create jobs, attract new investment, and solidify our leadership position in advanced manufacturing and logistics throughout the Caribbean region.”

Industrial Development Milestone in the Dominican Republic

A new frontier in Dominican Republic industrial park development, the Savanna Free Zone Park marks one of the most significant projects slated for completion within the next ten years. Today, the National Council of Free Zones for Export (CNZFE) signed the agreement to establish the Savanna Free Zone Park. “This groundbreaking represents much more than just an industrial park,” said Manuel Estrella, Chairman of the Board of Grupo Estrella. “It represents a great opportunity to welcome high-value-added industries to the country and better connect the Dominican Republic to markets around the world.”

Key aspects of the Savanna Free Zone Park include:

• Near vicinity to Las Américas International Airport and Port of Caucedo in Boca Chica
• Approximately 1.3 million square meters of land
• Zones dedicated to:
• High technology

Creation of a new ecosystem to develop businesses, including offices, high-value-added manufacturers, advanced logistics companies, and service providers. Minister Sanz Lovatón added, “We are committed to building the largest and most technologically advanced industrial park in the Dominican Republic. At Savanna Park, we are consolidating the pillars of innovation, technology, and sustainability all under one roof.”

Dominican Republic Continuing to Expand Industrial/Logistical Footprint

The Savanna Free Zone Park joins eight other companies selected by the CNZFE during its first ordinary session of the year 2026. Together, these companies will create:

• 615 direct jobs
• USD 8.336 billion in estimated revenues
• Investments spread throughout industries, including logistics, tobacco, textiles, and telecommunications.

“These are projects that catapult the Dominican Republic’s capacity to generate an ecosystem conducive to high-tech manufacturing,” said Daniel Liranzo, Executive Director of CNZFE. “Coupled with our competent workforce, these projects are going to make the Dominican Republic a top destination for foreign investors.”

Strategically Located among Leading Ports and Airports in the Caribbean

Located in Boca Chica, Savanna Park will provide unparalleled connectivity with Latin America and the rest of the Caribbean thanks to its proximity to both Las Américas International Airport and the Port of Caucedo. Savanna Free Zone Park’s location provides:

• Strategic proximity to ports that will allow for seamless import and export of goods.
• Access to global trade routes that Dominican companies can use to compete with neighboring countries.
• New opportunities to attract innovation-centric businesses looking to capitalize on advanced manufacturing processes.

Companies interested in setting up operations in the Savanna Free Zone Park will benefit from modern infrastructure designed to foster business development and growth. The park will feature:

• High-speed telecommunications with redundancy circuitry.
• Training centers focused on growing a skilled workforce.
• Full-time surveillance system with state-of-the-art technology.
• Landscaping optimized with native species to limit water usage.

Free Zones in the Dominican Republic Lead Year in 2025; Will Continue Growth in 2026

Minister Sanz Lovatón shared that in 2025, free zones successfully:

• Supported more than 200,000 direct jobs
• Exported USD 8.604 billion, representing over 60% of goods exported from the Dominican Republic

“The free zone sector has withstood global challenges and come out stronger,” Sanz Lovatón said. “As we move forward with projects like Savanna Free Zone Park, we are ensuring that the sector continues to grow and diversify.”

CNZFE projects that free zones will continue to lead the charge in 2026 by:

• Creating jobs
• Drawing in foreign direct investment
• Exporting more goods to countries throughout Latin America and the Caribbean

Dominican Republic Launches The Savanna Free Zone Park to Advance Industrial Presence

With a focus on sustainability and economic development, Savanna Free Zone Park embraced environmental policies and responsible development practices.

“Increase park visitors while limiting our impact on the environment,” Sanz Lovatón continued. “Every aspect of this project has been executed with sustainability in mind.”

Sustainability efforts included:

• Planting native species to decrease the park’s water consumption.
• Building efficient infrastructure to reduce power usage at offices, warehouses, and industrial plants.
• Establishing a circular logistics model.

Ready for Businesses to Lease and Purchase Office Space, Industrial Plants, Warehouses, and More

Infrastructure at Savanna Park will include options to lease or purchase office space, industrial plants, warehouses, and service providers. All projects adhere to laws and regulations set forth by the Dominican government. “We are not only creating a space for businesses to thrive,” Sanz Lovatón said. “We are creating a community for companies focused on innovation and high technology.”

The Newest Industrial Park to Launch in the Dominican Republic

The Hispaniola Industrial Free Zone Park was launched last month and joins the Savanna Free Zone Park as one of the newest industrial parks to launch in recent history. The industrial park, which began development in San Antonio de Guerra, also located in the province of Santo Domingo, will feature:

• Investment: RD$2.4 billion.
• Estimated job creation: 15,000 jobs.

Daniel Liranzo stated: “Not only have we broken ground on what will be one of the largest industrial parks in the country, but we have also seen the private sector take notice of our initiatives and kick off the development of the Savanna Free Zone Park.”

Dominican Republic Builds upon Increased Interest from Foreign Investors to Develop Industrial Sector

Manufacturing, free zones, and advanced industry continue to see interest from private investors and manufacturing companies around the world. By reinforcing its footprint in advanced manufacturing and logistics, the Dominican Republic hopes to establish itself as a leader in the region.

Chilean Exports Hit Record Highs as January Foreign Trade Tops US$18 Billion

January saw Chile post record-breaking exports of goods and historic trade exchange totals surpassing US$18 billion for the first time in a single month. Foreign trade grew 3.1% year-over-year in January 2026 despite sustained price pressures, kicking off what could be another banner year for Chile’s exports.

Published by Subrei, Chile’s Undersecretariat for International Economic Relations, the Monthly Report on Chile’s Foreign Trade shows exports totaled US$10.68 billion in January 2026, up 8.5% from the same month last year. It marks the highest total value for goods exports in January of any year on record.

Destinations for Chilean exports varied, with Asia continuing to lead the region by volume, followed by North America and Europe. Services exports also showed strong growth in January.

Mining Again Drives Chilean Export Growth

Mining continues to dominate Chilean exports, responsible for more than half (52%) of all exports leaving the country by value. Mining products exports totaled US$5.558 billion in January up 12.1% year-over-year.

The majority of Chile’s mining exports are comprised of copper exports. Copper cathodes and concentrates alone were exported to the value of US$4.546 billion.

January 2026 also saw strong export totals across gold, lithium carbonate, iron, molybdenum concentrate, and silver. The leading non-copper products shown above increased by over US$35 million each.

As a reminder, Chile’s extractive industries play an outsized role in overall exports, consistently representing over half of all goods shipped abroad.

Highest-Ever Fruit Export Totals Point to Continued Strength for Chile’s Agricultural Brands

Food exports from Chile reached US$1.318 billion in January, up 13% from January 2025 and marking the best January performance for the sector ever recorded.

Leading products by export value were fresh cherries, which alone accounted for more than two-thirds (US$1.231 billion) of all fruit leaving the country. Other noteworthy performers were fresh blueberries and fresh nectarines.

Demand for Chilean agricultural exports remains strong in Asia, North America, and Europe, thanks in large part to the country’s advanced cold chain logistics capabilities.

Strength in Processed Foods Shows Increased Diversification of Chilean Exports

Perhaps more impressive than Chile’s agricultural export figures were totals posted by the food industry. January’s food industry exports reached US$1.318 billion, showing an increase of 13% on a yearly basis and marking the best start to a year on record for the sector.

Driving growth across the sector was:

• salmonids
• frozen jack mackerel
• tomato purée
• frozen Patagonian toothfish
• frozen strawberries.

The health food trend continued to drive strong sales of organic food exported abroad, reaching US$72 million total and showing an increase of 15.9%.

Exports of fresh blueberries and frozen fruits such as strawberries, raspberries, and cherries also contributed to January’s impressive performance.

Traditionally Weak Segments Perform Mixed in January 2026

Shipments of bottled wine reached US$108 million total, falling precipitously (-9.4%) from the year prior. Chile’s winemakers have struggled this year to brand Chile outside of red blends, which saw declining exports in January.

Segments where exports grew despite an overall industry decline were bottled wine varietals, such as:

• Cabernet Sauvignon
• Merlot
• Riesling

Forestry manufacturing exports dipped 15% year-over-year to US$490 million. Key drivers of the pullback were declining shipments of pulp, profiled wood, and paperboard.

Growing forestry exports were:

• sawn radiata pine wood
• plywood, fluting papers
• wood pellets
• self-adhesive paper
• prefabricated constructions and offices
  doors, and tool handles

Agglomerated cork stoppers also increased year-over-year.

Chemical Manufacturing Bolsters Rising Contribution of Manufactured Goods to Chilean Exports

Industrial product exports continued to diversify in January 2026, with chemical manufacturing posting outsized growth. Exports of manufactured chemicals grew 47% from the year prior to US$862 million.

Driving chemical exports were:

• iodine
• lithium sulfate
• lithium hydroxide
• potassium nitrate
• fertilizers

Chilean manufacturers will likely play an increasingly important role in the global energy transition, driven by strong global demand for battery-related materials, particularly lithium.

Shipments of machinery and equipment grew 29.9% from January 2025 to US$144 million. Leading products were:

• Machinery for mineral processing
• Parts for drilling or exploratory machinery equipment
• Washing machines, tumble dryers, dryers, and cooking stoves
• Cold room cabinets
• refrigerated display cases

Activity was seen across a diverse range of sectors, suggesting maturation in Chile’s industrial manufacturing and export sector.

Non-Traditional Exports Lead the Way in January

For the first time ever, January 2026 saw greater value generated from the export of non-traditional goods than from traditional exports. Led by hazelnuts and frozen jack mackerel, non-traditional exports totaled US$5.622 billion and grew 9.8% year-over-year.

Additional noteworthy exports included fresh blueberries, frozen salmon fillets, fresh plums and fresh nectarines, fertilizers and ammonium nitrate, copper wire, and parts for drilling machinery equipment.

The diversification of Chilean exports will serve to insulate the economy from negative shocks to copper prices.

Services Exports Surpass US$400 Million for the First Time

Services also saw record growth in January, exceeding US$400 million (+37.4%) for the first time. Maintenance and repair of aircraft and aerial equipment alone reached US$141 million.

Other sectors showing strength were:

• Corporate administrative management advisory services: US$42 million
• Financial services associated with expert witnesses: US$16 million
• Information technology advisory services: US$15 million
• Logistics support services: US$14 million

Expansion of high-value services, such as those posted by Chile above, provides an opportunity for diversification of the economy, something that policymakers have sought for many years.

Stable Policy Environment Contributing to Export Growth

Like previous months, Chile’s trade growth has been attributed to a stable policy environment that seeks to continuously open markets and diversify trade relations abroad. The sustained expansion of Chilean exports can also be attributed to strong logistics infrastructure and an expansive network of free trade agreements.

Administrated by Subrei, Chile’s trade institutions use data reported by the Central Bank as well as data from Chile’s National Customs Service to monitor changes in export trends and guide policymakers.

Recent analysis by Harvard University has shown that El Salvador has risen in the economic complexity rankings. As a country develops new productive capabilities that are exported, it becomes more economically complex. Harvard’s analysis places El Salvador as the 59th most complex economy out of 100 countries included in their index. The report also forecasts that El Salvador’s  will rise in the economic complexity rankings by 14 spots over the next few years as El Salvador’s economic complexity grows at a rate of 1.48% per year.

What Do Economic Complexity Rankings Mean?

Economic Complexity can be described as a country’s diversity of productive capabilities as demonstrated by the different products that it exports. Countries that export a diverse array of complex products like electronics, machinery, auto parts, and other manufactured goods tend to grow faster than countries that export a very limited scope of products. Over time, complex economies have been shown to grow faster than their peers, and improvements in a country’s economic complexity ranking often correlate with stronger long-term growth prospects.

Why Should We Care?

Globalization has led to increasing economic complexity, which has contributed to accelerated economic development around the world. As technology changes at an accelerating pace, countries need to develop new capabilities to surpass their peers in the economic complexity rankings. Harvard’s Center for Growth Research maintains the Atlas of Economic Complexity, an online tool that allows users to analyze the different complexities of economies around the world.

Their latest Economic Complexity report analyzed the changing complexity of 100 countries and how it will affect future growth. This study is important because it has shown improvement for El Salvador and highlights specific industries that El Salvador is developing that can be used for future investment research, particularly as its economic complexity ranking continues to rise.

What Industries Are Fueling El Salvador’s Economic Complexity?

• Textiles/Apparel: Garments remain the dominant sector of El Salvador’s exports. Knitted shirts and sweaters are especially common.
• Agriculture/Industrial Products: Salvadoran exports also include sugar, plastic packaging bags, plastic containers, copper smelting, and nuts and dried fruits.
• Electronics: The Growth Lab lists electronic capacitors as a commonly exported product, which demonstrates the development of electronics assembling and manufacturing capabilities.

Of note, despite adding complexity through diversification of exports, the U.S. still accounts for nearly 80% of El Salvador’s exports, showing strong trade linkages with its northern neighbor. El Salvador also benefits from CAFTA-DR.

How Does El Salvador Compare Regionally?

El Salvador was not ranked highest in its potential to increase complexity, but it also did not rank lowest. Countries like Guatemala have the potential to grow their complexity faster than El Salvador, but are starting from a lower rank. Compared with most of its Central American neighbors, El Salvador ranked higher.

Vietnam leads the list of countries projected to grow fastest over the next decade. Mr. Hausmann, director of the Growth Lab, said, “Countries that are now diversifying into more complex economic activities than their peers today are the ones that we think will generate most of the growth in the global economy in the coming decade.” The full article from MIT Technology Review can be found here.

Multilateral Agencies Expect Strong Growth Going Forward

• International Monetary Fund (IMF): IMF projects 2025 growth to be around 4% by the end of 2025.
• World Bank: Projected growth of 3.5% in 2025 and 3% in 2026.
• Economic Commission for Latin America and the Caribbean (ECLAC): Estimates GDP growth of 3.5% in 2025.

All of these estimates put El Salvador’s growth rate well above the regional average of 2.4% and represent acceleration from 2.6% growth in 2024.

How Nearshoring and FTAs Drive Increases in Economic Complexity

One of the reasons for Salvadoran exports gaining complexity is that multinational companies are investing in El Salvador. They are attracted to El Salvador because it allows companies to nearshore production relative to Asia. Companies can take advantage of FTAs with the United States and Europe while maintaining shorter supply chains with suppliers located in Central America. Additionally, the government has incentivized companies to produce in the country through a variety of programs, such as tax holidays when operating in free trade zones, faster permitting processes, and investments in ports, logistics, and reliable energy.

How Is Economic Complexity Related to the Workforce?

Workforce development will be key to continuing to grow economic complexity. Over the last decade, the Salvadoran government has invested in improving technical education as well as manufacturing-specific skills training. Many multinational manufacturers have invested in training and bilingual services. Additionally, there has been an increase in technical colleges that offer students job-ready skills. While workforce skills have improved over the last decade, there is still significant room for productivity gains moving forward.

What Does Higher Economic Complexity Mean for El Salvador?

Increased complexity reduces risk for investors and corporations because it signals that the necessary inputs and skills are already present in the country or can easily be sourced from neighbors. For policymakers, the complexity analysis shows the benefits of economic diversification. For countries like El Salvador, this improvement signals an opportunity to gain investment from companies that are looking to nearshore their supply chains.

Paraguay has signaled that it is preparing to welcome new mega-sized industrial projects into the country’s forestry sector after President Santiago Peña met last week in Asunción with Peter Kaindl, CEO of Kronospan Group SA, the largest global producer of wood-based panels. The meeting comes amid renewed speculation that a major industrial project could be coming to Paraguay soon. Such projects have remained elusive for several years, even as the country’s area stocked with forest plantations has grown rapidly, and macroeconomic conditions have remained positive and stable. The meeting at Paraguay’s Government Palace was part of a wider-ranging government effort to promote manufacturing investments tied to the forestry sector instead of simply raw material exports. Mr. Kaindl is visiting Paraguay for undisclosed reasons, while government officials are reaching out to other potential investors in Brazil and elsewhere. Wood panel industry analysts have viewed those moves as a strong indication that a multi-billion-dollar project related to panel manufacturing or pulp production could materialize soon.

Meeting with Forestry Industry Titan

Mr. Kaindl is an Austrian businessman who has served as head of the Kronospan Group for many years. Kronospan is based in Austria but has facilities in Europe, Asia, and the Americas. The company manufactures particleboard, MDF panels (medium-density fiberboard), laminate flooring, and other wood-based materials used in furniture making and construction. It is currently the world’s largest producer of panels made from engineered wood. Kronospan operates in countries around the world, so interest in expanding its production further is closely watched by the forestry sector and construction industries in many countries. Mr. Kaindl traveled to Paraguay during a critical window during which government officials were meeting with investors to discuss potential opportunities related to forest plantations. Forestry investment in Paraguay is likely to continue picking up if multinational corporations like Kronospan believe that they can competitively produce goods for export to regional and international markets from Paraguay.

Background on Paraguay’s Forestry Sector Ambitions

Paraguay has grown its forest plantation area by about 10% each year on average over the past two decades. Forest plantation investments have been incentivized by Paraguay’s public sector, benefited from the country’s suitable climate, and experienced tremendous growth from private sector investment. Peña and previous administrations have encouraged landowners to plant trees through various public programs. They have also required long-term land use planning and other steps designed to ensure forestry projects would last for many years and supply raw materials that could eventually feed industrial projects capable of processing logs, wood chips, and other outputs into higher-value products. Forestry industrialization has been a particular focus of the Peña administration. While wood chip exports and log exports bring in millions of dollars of annual revenues for Paraguay, government officials have said that the country needs to attract companies that will operate sawmills, panel plants, pulp mills, and other industrial projects that further add value to exported goods. Forestry investment in Paraguay may be treated as synonymous with industrial policy under the Peña administration. Plans by Kronospan or another global leader in forestry manufacturing would create a flagship investment that Paraguay could promote to investors from other countries around the world.

Could Kronospan Bring Mega-Projects to Paraguay?

Forestry industry analysts believe that Kronospan is coming to Paraguay to explore opportunities related to either wood panels (MDF, particleboard) or pulp. Both forest products segments would be major investments for the company, though pulp is believed by some to be a primary target for investment. Analysts pointed to remarks by Paraguayan businessman Blas Zapag promoting a pulp plant referred to as Paracel that has failed to secure financing in recent months. Global pulp markets have been challenged by inflation and higher borrowing costs, making it difficult for the Paracel project to close on financing even though trees have already been planted in preparation for its development. Countries like Brazil are also experiencing challenges. The Arauco Group recently announced that it is studying alternative financing for a pulp plant under development near Brasilia due to higher capital costs. That pulp project, Sucuriú, may have to be partially sold off by Arauco in terms of its forest estate in order to advance. Forestry investment in Paraguay could become more likely if Kronospan views the country as a low-risk destination, given financing challenges elsewhere. Paraguay boasts low levels of debt compared to other countries in the region, stable macroeconomic indicators, and pro-business policies that are likely to appeal to global investors. Analysts say low operating costs in Paraguay are another potential draw for foreign investors looking at mega-sized projects that can take advantage of economies of scale.

Is MDF on Kronospan’s Radar?

It’s also possible that Kronospan is vetting an MDF manufacturing project during its trip to Paraguay. Last February, Paraguayan officials traveled abroad to tour an MDF facility as part of an investment promotion mission. During that mission, President Peña and senior officials met with Peter Kaindl, according to a source familiar with the meeting. An MDF manufacturing project would require consistent supplies of plantation-grown trees as well as reliable access to affordable energy and the ports needed to export products around the world. As noted above, forestry investment in Paraguay’s MDF sector could create demand for countless complementary products and services that would create jobs and boost value chains related to furniture making, construction, and other similar industries. SMEs in particular stand to benefit if larger projects are able to connect with local companies serving Paraguay’s plantation sector. Adding wood-based panel capacity in Paraguay would make sense from Kronospan’s perspective, too. Demand for MDF in South America has grown in recent years as countries look to promote wood-based construction.

Government Says Little about Plans but Shares Photos of Meeting

There have been few official announcements from the Paraguayan government about the potential implications of President Peña’s meeting with Peter Kaindl of Kronospan. Photos of the meeting were posted on X, formerly Twitter, by both the Presidency and President Peña. In the photos, Mr. Kaindl can be seen flanked by both President Peña and Graciano Pereira, a Paraguayan businessman with interests in rice farming and agroindustry. The newspaper Última Hora also reported that Peter Kaindl said that Paraguay has good forestry policies and seems interested in industrial projects instead of simply raw material exports. There has been no indication of a timetable should talks continue between the Paraguayan government and Kronospan. Such negotiations can often drag on for years as both parties conduct feasibility studies, track borrowing costs, solicit input from lenders, and negotiate key terms of any resulting agreements. Meetings like the one last week can take on increased importance when officials say little beyond showing that they met with potential investors from countries all around the world. Forest investment in Paraguay relies on these types of meetings to gain momentum.

Paraguay Poised to Become Forestry Hub

Plans related to MDF, pulp, or panels could help turn Paraguay into a regional hub for forestry-related industries. Global markets for wood products, sustainable packaging materials, and other bio-based sources of energy are expanding every year. Countries with strong capabilities in plantation forestry stand to benefit. Kronospan choosing to expand production in Paraguay would also create opportunities for suppliers of equipment, feedstocks, transportation services, and more. Forestry investment in Paraguay would have positive effects that reach far beyond the size of the initial investment. Rural communities that are home to plantation forestry investments would likely experience periods of accelerated development. Exports of higher-value wood products would diversify Paraguay’s trade portfolio and help the country connect with markets in North America, Europe, and Asia that demand sustainably sourced and traceable raw materials.

Forestry investment in Paraguay will continue to be watched closely by industry analysts and investors around the world as the results of Kronospan’s visit continue to unfold.