When large Latin American companies were squeezed by aggressive multinational expansion in their home markets in the 1980s and 90s, they began to respond in kind, moving into regional and international growth mode. Together with multinational expansion from outside the region, these deals upped the percentage of cross-border companies in Latin America's very large firm segment from around 25% to close to 40%, according to a 2003 study by management consultancy firm Booz Allen Hamilton and The University of Pennsylvanias Wharton School.
Small- and medium-sized enterprises (SMEs) could be next, bankers say, as there are signs that the mindset for expansion is already in place for companies. João Roberto Teixeira, executive vice president of ABN Amro Real in São Paulo reveals that a number of his smaller clients in Brazil are devising international strategies, sometimes in tandem with their domestic plans. First, there is the wave of globalization that Brazilian companies are witnessing and responding to," Teixeira explains. "Second, the opening of capital markets is giving smaller companies the means to expand overseas. Before expanding abroad, Teixeira says smaller companies must identify a competitive advantage.