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South America stirs to life thanks to privatization, reform and much attention from shipping outfits.
Is change good? Ask someone involved in shipping goods-or transporting them-to South America. The region, not long ago served by government-subsidized airlines and ocean carriers offering marginal service, has suddenly become an anthill of economic activity with some of the world's largest and most-efficient transportation companies chasing the action.
These days it seems that the sleeping giant has awakened to its potential, aroused by crumbling trade barriers, privatization, and economic and political reform, all seen as keys to the region's future. Just two years ago it would have been almost unheard of to see a widebody, all-cargo aircraft operating on a route to South America. A modern containership would have been out of place.
Today, major carriers Crowley, SeaLand, Maersk, Zim, Alianca and others are offering service to and from ports throughout the region almost daily, while air carriers like Challenge Air Cargo, American, Continental, Arrow Air and AmeriJet move growing amounts of freight between air terminals in the U.S. and Latin America. For shippers, the lowering of trade barriers and the influx of transportation providers means increased demand from the Latin American marketplace and more options when it comes to getting goods there. Freight rates, both sea and air, have dropped and stabilized as more carriers move into the region's alreadycrowded trade routes.
Last year, Latin America and the Caribbean combined to become the second leading regional destination for containerized U.S. exports, trailing only Asia and outpacing Europe for the first time ever.
Over the last two years, U.S. containerized exports to Latin America have grown by 21%, from 1.1 million 20-foot containers, or TEUs (twenty-foot equivalent units), of goods to 1.3 million TEUs-a trend expected to continue in the near future. According to the Commerce Department, exports this year of auto parts, chemicals, consumer goods, machinery and other products are expected to climb by close to 10% and by the end of next year, forecasts predict U.S. exports to the region could climb to as many as 1.5 million TEUs. On the import side, last year the U.S. took in 11% more products-mainly footwear, beef, seafood, coffee and auto components-from Latin America than it did in 1994,...