Downside for Latin America commodities boom?
While strong global demand for commodities produced in South America is driving the current trade boom in Latin America, those markets could erode because of the historic boom and bust cycles for commodities.
That's the assessment of a Florida International University professor specializing in international business markets.
'The commodities boon is temporary,' Jerry Haar, a professor at FIU told the Miami Herald, which published a report on growth in Latin American trade. 'When commodity prices come down, you'll have social and civil unrest.'
The report noted that the current strong demand and high prices for oil, natural gas, gold, iron ore and copper and fueling a trade boom. With Latin American exports boosting currency reserves, the South American nations producing commodities have also increased imports from many nations, typically led by the U.S.
Meanwhile, the getting is good for southbound shipments. Exports to Latin America are up 12.7 during the first six month of this year, according to statistics compiled by the U.S. Census Bureau.
Downside for Latin America commodities boom?
