The Economy of Latin America

The Economy of Latin America — page 5 — After gaining their independence many Latin American countries set up republics They modeled these govern ments after governments in northern Europe and the United States Many countries experienced political instability National governments were rapidly replaced This polit ical instability also affected the region’s economies The countries struggled to find sources of income to pay for new military and government expenses The governments com monly found themselves in financial difficulties In the nineteenth century industrialization spread through Europe and North America These countries turned to Latin America for its raw materials By the second half of the nineteenth century Latin America became an important exporter of raw materials Most Latin American countries had one or two main exports typically minerals or foods until the 1950s Relying on only a few exports made these countries vulnerable to changes in global demand Although many people talk about Latin America as one region there are enormous differences in the area The people live in a large number of independent nations and the geography and climate of each country can vary greatly As a result the economies of each nation are diverse Areas such as Mexico and Central America export many manufactured goods while countries in South America are major exporters of agricultural commodities petroleum and minerals such as iron ore Most of Latin America’s economies rely on capitalism In this type of economy trade and industry are generally controlled by private companies However the governments intervene in some areas of investment industry land owner ship and trade Today agriculture remains an important part of the Latin American economy In general about one-fourth of 6 THE ECONOMY OF LATIN AMERICA

The Economy of Latin America — page 6 — INTRODUCTION Made up of many independent countries Latin America is a very diverse region that is rich in natural resources Each area has its own native plants animals and resources 7

The Economy of Latin America — page 7 — Latin American workers work in agriculture In some poorer countries like Haiti and Nicaragua the number is even higher Services are a large and growing economic sector while manufacturing remains important Still Latin Amer ica depends heavily on its exports of commodities which makes it vulnerable to changes in market demand and world prices 8 THE ECONOMY OF LATIN AMERICA

The Economy of Latin America — page 8 — CHAPTER ONE AGRICULTURE FISHING AND FORESTRY L atin America’s economy relies on the export of foods and primary goods such as coffee from Brazil and Colombia beef from Argentina and bananas from Ecuador It also benefits from rich fishing grounds in the Caribbean Sea Atlantic Ocean and Pacific Ocean AGRICULTURE AND FARMING Many of Latin America’s staple foods have been grown since ancient times including corn beans and squash in Mexico and Central America quinoa corn and potatoes in the Andes and cassava and citrus fruits in lowland rain forests Rice plantains and bananas are vital to the Latin American diet Export of raw materials and foods is a major part of the Latin American economy Between 2012 and 2014 the region exported an estimated 16 percent of global food and agricultural products Fertile highlands have 9

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