Central and South America is highly diverse, economically and culturally. In Brazil, the economy grew at a rate of 1.1%. Chile suffered a wave of riots and protests at the end of 2019. In response, the government has lurched to the left, increasing government spending by at least $1.5 billion a year. By the middle of 2019, the volume of retail sales in Colombia was growing at a rate of 10.1% a year. The flipside to this is that Colombia currently hosts 1.4 million Venezuelan refugees, which puts a strain on resources and infrastructure. The economies researched are highly dependent on commodity markets — most, with the exception of Colombia, export heavily to China — for oil, copper and other raw materials. Central and South America could be in for a bumpy ride in 2020.
The Local Payment Culture
The most common means of paying for an online purchase in Latin America is by credit card, used in 58% of all online transactions. Cash has 17% of the online payment market, bank transfer 13%, e-wallets 10%, and other minor payment methods the remaining 2%. Visa is the biggest player in the card market, with a 42% market share, followed by Mastercard (38%), local and other schemes with 18% and American Express with 1%.
The E-Commerce Market
The e-commerce market in the countries selected for detailed study is worth $50 billion and is growing at a rate of 23% a year. Today, 34% of online purchases are made using a mobile device and the average annual spend per online shopper is $471. The most popular purchase categories in Latin America vary from country to country. In Argentina, Chile, Colombia and Peru travel is the number one category. In Uruguay it’s clothing, and Brazil electrical goods.