Month: February 2025

In today’s fragmented global trade landscape, South America is emerging as a savvy player, striking a delicate balance between major economic powers like the United States, China, and the European Union. Thanks to its neutral stance, the region is not just weathering geopolitical tensions — it’s thriving, according to DP World’s 2025 Trade in Transition report. The annual report, co-authored with Economist Impact, examines the headwinds of global trade in 2025 and their impact around the world.

The regional South American report, “South America: Positioning for Global Connectivity” finds that by expanding trade agreements and attracting foreign direct investment (FDI), South America is positioning itself as a vital connector in the global supply chain. However, its path forward is not without challenges.

Neutrality: An Advantage in a Divided World

As the world’s largest economies engage in trade wars and protectionist policies, South America is charting a different course. According to the survey, 64% of South American executives view global trade fragmentation as a positive opportunity for the region’s exports.

This optimism reflects the region’s ability to maintain strong relationships with all three major blocs — the United States, China, and the EU — without overly aligning with any one of them.

Geopolitical tensions have created opportunities for South America to capitalize on disruptions. For instance, Brazil’s dominance in soybean exports to China, following Chinese tariffs on U.S. soybeans, underscores the region’s ability to turn trade disruptions into advantages.

Neutrality is also seen as a driver for attracting FDI, with 32% of executives pointing to this balanced approach as a way to expand manufacturing capabilities. By diversifying economic relationships, South America is building resilience against the uncertainties of relying too heavily on any single trade partner.

Trade Agreements: Building Stability Amid Uncertainty

Trade agreements are central to South America’s strategy to remain competitive in an unpredictable global market. The recently concluded EU-Mercosur trade negotiations mark a key milestone, reducing barriers and enhancing market access between South America and Europe.

Countries like Chile and Peru are leveraging free trade agreements (FTAs) with the United States and China to diversify their export markets and provide the stability businesses need in a world edging toward protectionism.

However, the region isn’t immune to the ripple effects of U.S. trade policy. Some South American businesses are adapting supply chains to mitigate potential tariffs, such as those targeting goods routed through the region from Chinese ports. This reflects the need for agility as global trade dynamics shift.

China’s Influence: A Double-Edged Sword

China’s economic footprint in South America has grown significantly, with bilateral trade increasing from $18 billion in 2002 to over $500 billion in 2024. Chinese investments in infrastructure and trade agreements have helped South America diversify its economic ties, but they also come with risks.

While deepening ties with China has strengthened trade networks, concerns remain about over-reliance on commodity exports and potential sovereignty issues. Additionally, North America’s protectionist policies could pressure South America to limit partnerships with Chinese firms. Balancing these competing relationships will be critical for long-term stability and resilience.

Infrastructure Challenges: A Roadblock to Growth

South America’s trade ambitions are constrained by its underdeveloped infrastructure. Logistical challenges such as unpaved roads, port inefficiencies, and unreliable electricity create barriers to building cost-effective, interconnected supply chains.

Addressing these issues will require significant investments, including public-private partnerships and international funding. However, infrastructure projects — especially those financed by China — often come with dual-use capabilities that could complicate global relationships.

Despite these obstacles, some countries are finding innovative ways to attract investment. Chile, for example, is positioning itself as a global leader in clean hydrogen production, leveraging its renewable energy resources to promote sustainable growth. Such initiatives highlight the potential for South America to align growth strategies with global sustainability goals.

Nearshoring: A Strategic Shift

Nearshoring is gaining traction among South American businesses as they seek to reduce logistics costs and improve supply chain resilience. According to the survey, 41% of executives cite reducing transport and logistics costs as their primary motivation for nearshoring, compared to a global average of 33%.

Countries like Argentina, under its recent free-market reforms, are striving to attract foreign investment by encouraging private enterprise and increasing competition. Similarly, other nations in the region are investing in infrastructure and reforms to establish themselves as hubs for transport and distribution.

However, these efforts depend on reliable tax incentives and clear legal frameworks. Without a stable regulatory environment, the region risks deterring the very investors it seeks to attract.

Digital Transformation: The Tech Advantage

South American firms are increasingly turning to technology to address trade challenges. Artificial intelligence (AI) is playing a growing role in reducing trade costs, improving planning, and optimizing cash management. Digital tools for inventory management and supply chain visibility are helping businesses mitigate logistical challenges tied to poor infrastructure.

While AI adoption varies across industries, its potential to enhance efficiency is undeniable. By streamlining operations and cutting costs, digital transformation is helping South America position itself as a competitive global trade partner despite its infrastructure gaps.

The Path Forward

South America stands at a crossroads, with opportunities and challenges in equal measure. By maintaining neutrality, leveraging trade agreements, and investing in infrastructure and technology, the region is navigating the complexities of modern trade with remarkable adaptability.

However, success will depend on South America’s ability to balance relationships with major powers while addressing internal challenges such as infrastructure development and regulatory stability. With the right strategies, the region can solidify its position as a vital player in the global economy.

Curious to learn more about South America’s trade dynamics? Click here to download a copy of the full report, where you can dive deeper into the findings shaping the region’s future.

Mastercard

More than 3,000 business and government leaders, academics and artists gathered in the mostly snow-less Swiss Alps for the World Economic Forum’s annual summit in Davos under the banner “Collaboration for the Intelligent Age” last week. And while all eyes were on Washington with the U.S. inauguration, the discussions on the ground emphasized the need to drive forward digital transformation — from agentic AI to blockchain to the commercialization of these technologies — that benefits everyone. 

“In a day and age where you’ve got … a disaggregated world, you want something that protects you,” said Jon Huntsman, Mastercard’s president of Strategic Growth, at a panel on stemming financial fragmentation. “We have spent a lot of money on consumer protection, on cyber, on tokenization … that allows us to gain critical insights and intelligence on who’s got your information, who might be a bad actor, and how to avoid that.”

AI remains atop the agenda

Artificial intelligence continued to dominate discussions — both its “stunning technology possibility,” in the words of former U.S. Treasury Secretary Larry Summers, and the “epic challenge” it poses for governments all over the world. Leaders discussed a number of those challenges they needed to address, including how they could meet the demands for energy and computer chips that heavy use of AI requires.

Additionally, they’ll have to confront a potential “crisis of truth” that AI could exacerbate, as Pope Francis characterized it in a written address, and find ways to upskill employees for the age of AI — even as a WEF survey earlier this month revealed that 41% of employers globally plan to downsize their workforce by 2030 due to AI automation. In fact, Salesforce CEO Marc Benioff said that the chief executives gathered in this Swiss village would be the last generation to manage all-human workforces.

Even as participants discussed the big issues of the day, they didn’t lose sight of the little things that are foundational to digital alignment and collaboration. Described by one participant as “inspired dullness,” a continued drive towards common standards came up frequently.

For small businesses, AI could be a gamechanger, but panelists acknowledged there are challenges in bringing those benefits to resource-strapped entrepreneurs. “There’s mistrust around technology. There’s time poverty. There’s a sense of overload in terms of where to start,” says Payal Dalal, an executive vice president for global programs at the Mastercard Center for Inclusive Growth, at a panel hosted by the Center on driving resilience for small businesses in an AI-driven world.

“And finally,” she continued, “small businesses don’t know how AI can really help them save time and make money. So really understanding what the needs of the small businesses are and then figuring out how AI can help as opposed to just pushing AI towards small businesses is the way forward.”

And in a piece for the WEF Agenda blog published as the summit opened, Ling Hai, Mastercard’s president for Asia Pacific, Europe, Middle East and Africa, highlighted how partnerships across the public sector, nonprofit and private sector are essential to accelerating the digital journeys of small businesses, which can boost economies and drive greater inclusion and resilience.

Trust must be foundational

In addition to AI, the rise of cybersecurity risks was a major topic of discussion at WEF this year. As attacks are growing in scope and scale, small businesses need help, Ling Hai wrote. “Given the pressures of running a small business, it is impossible to expect owners to keep track of the latest updates or research the best network monitoring software, but trust with customers that has taken years to build can be shattered in seconds by a cybersecurity breach.”

A new report by WEF released earlier in January on the state of cybersecurity pointed to the growing complexity of cyberspace, which is widening the opportunity gap between large and small organizations, and deepening the economic divide between developed and emerging economies.

Collaborative action, particularly between the private and public sector, is needed to ensure “we can bring innovation and data in the context of AI along, so that we can ensure that the Global South is well protected for future generations,” said Kiki Del Valle, Mastercard division president for North Latin America at a panel convened by ODI and Mastercard on leadership in an era of weakened multilateralism.

Another worrying finding of the survey: About 35% of small organizations believe their cyber resilience is inadequate, a proportion that has increased sevenfold since 2022. Meanwhile, many more large organizations are reporting that they believe they have enough cyber protections.

“Safety and security, right now, is one of the biggest threats that face us globally,” said Linda Kirkpatrick, Mastercard’s Americas president, who joined a panel on the WEF mainstage on the future of the economy in Latin America and the Caribbean.

“One positive outcome of the pandemic was that our small businesses, our consumers, got comfortable in a digitized environment,” she said. “We want everyone to have access, and we want access to drive usage. At the same time, that advancement in digitization can lead to risk in the system in the form of cyberattacks. Safety and security, right now, is one of the biggest threats that face us globally. We need to unify around a common goal to protect our digital ecosystem.”

Originally published by Mastercard

Follow along Mastercard’s journey to connect and power an inclusive, digital economy that benefits everyone, everywhere.

By Kevin Delaney

Keeping our rooms clean and safe. Maintaining personal hygiene. Staying connected with family.

For many of us, these are simple, everyday tasks. But for those with diverse abilities — including seniors and people with cognitive disabilities — handling such tasks can be a daily triumph. And they can mean the difference between independence and constant supervision.

A pilot project funded by Cisco’s Country Digital Acceleration (CDA) program, Ignite Technology, and other partners has been exploring how digital solutions can help. Under the brand name Hayla, a suite of high-tech innovations has evolved into a streamlined, secure, app-based platform that is ready for market.

“A lot of these individuals are looking to live more independently, autonomously, maybe move to a situation where they’re on their own,” explained Ignite CEO Steven Taylor. “And the Autonomous Living Project, now branded Hayla, uses technology to help people work towards the goal of self-sufficiency, independence, and greater dignity.”

The origins of Hayla began in 2021 at the Lou Fruitman Residence in Toronto, which is run by Reena, another partner in the project. The Residence houses 138 adults and seniors with diverse needs. And as part of this project, it adopted a number of technologies — including Internet of Things (IoT) sensors, automated alerts, smart-device integration, collaboration hubs, and a proprietary app — all supported by customized Cisco and Cisco Meraki products.

The concept is built around self-sufficiency, not surveillance. Through remote monitoring, smart notifications, alert services, and smart-device integration, users receive in-home support that enables them to live independently and safely. However, if the need arises — whether for an emergency, basic reminders, or emotional/mental counseling — caregivers can step in quickly.

It’s technology that’s geared to individual outcomes.

“If we’re talking to an individual and a caregiver,” Taylor said, “we don’t simply talk about the sensors they can have. We talk about the challenges they’re experiencing today, and we look at implementing a solution that leverages technology to actually help address those challenges.”

Security and simplicity for positive good

With their shared commitment to simple-to-use, secure technologies, Cisco and Ignite were ideal partners.

“Like Cisco, Ignite is committed and visionary,” said Wayne Cuervo, director of Cisco Canada’s Digital Impact Office. “They have an ideal view of how technology can not only help, but how technology can get out of the way — to simplify the experience.”

Hayla represents a big commitment in time, technology, and expertise from Cisco, particularly its CDA program.

“We consider Hayla to be one of our most important projects,” said Cuervo. “It’s a profound story that helps transform the lives of people. And we feel it’s very scalable to other use cases around the world.”

As for the outcomes so far, Jessica Noftle, day program supervisor for another partner, the Toronto-based family-support organization Creating Alternatives, weighed in from a caretaker’s perspective.

“With Hayla’s expertise, innovation and devices,” she said, “we have successfully been able to help more than 10 supported individuals transition out of fully supported days, to semi-independent living. Hayla’s dedication, along with their mentorship, has been a huge success for us at Creating Alternatives. We hope to continue to work alongside them for years to come.”

A scalable solution for aging populations

Hayla makes it all happen with a foundation of Cisco technology.

“At the core of the hardware is a Cisco firewall router and an access point,” Taylor stressed. “That access point communicates with the Meraki IoT sensors in the unit, which monitor things like the refrigerator, doors, and showers. Essentially, you have your network equipment — that is, access points, firewalls, and switches for larger implementations, – and IoT sensors that are set in the environment for safety and peace of mind. Maybe it’s actually detecting water leakage, smoke in units, or simply helping to track daily living tasks.”

Communication, of course, is equally critical. And Cisco Webex — either through handheld devices or hardware like the Cisco DeskPro, combined with Webex Calling — keeps users, their families, and caregiving teams connected on both emotional and practical levels.

“Webex Calling is part of our custom software that we’ve integrated,” Taylor continued. “This allows individuals to call a parent, caregiver, or therapist simply by clicking their picture. Everything is handled on the back end, so it’s just one button to call.”

Security is a key concern, especially when sensitive medical or personal data is shared among vulnerable populations. So, Cisco and Meraki’s built-in end-to-end security ensures further confidence in the system. Despite a constant flow of data coming from sensors, monitoring is automated and intuitive.

“All of this is managed on the back end through the Meraki Dashboard and Cisco Control Hub,” Taylor added. “We have automated alerts through Meraki dashboard.”

For Cuervo — and Cisco’s Country Digital Acceleration program — supporting Ignite’s effort to bring Hayla to market is a great opportunity. CDA’s mission is to use technology for positive transformation around the world (in more than 50 countries so far), and Hayla is a perfect fit.

“We’re all about using technology to address challenges and doing it in a way that benefits society,” Cuervo said. “Hayla is significant at an individual level, but also at a national and global scale. In Canada and other countries, populations are aging, increasing the demand for social services, while the number of caregivers is shrinking. This solution enables caregivers to be more effective while improving the quality of life for those in need. For us, it’s a perfect combination of technology excellence and real-world, positive impact.”

View original content here.