Keeping Up With The Fulanos

Latin Trade, Nov, 1999 by Sally Bowen, Douglass Stinson, Beth Rubenstein, James (Supreme Court justice) Wilson

The boom-bust cycle over the last few years has at once raised hopes and caused people to resign themselves to a life of greater effort for diminishing gains. No one complains about the end of the era of hyperinflation. At least that has allowed Latin Americans to take a breather from ever-escalating prices.

The missing ingredient, of course, is growing purchasing power for the masses. For that to happen, the region will have to put together a string of years of strong growth, not just flash-in-the-pan results. "They need stability and balanced budgets for 10 or 15 years before a broad base of consumers emerges. Think what happens when you create a middle class in Latin America that can buy goods," Merrill Lynch analyst Eduardo Cabrera says.

"The potential is tremendous:'

Meanwhile, a class of consumers that cannot buy good is "middle" only as in "middle of nowhere."

                         MEDIAN ANNUAL WAGES (US$)

                OFFICE  DRIVERS MID- LEVEL MID- LEVEL  SENIOR
               CLEANERS         SECRETARY   MANAGER   MANAGER
JAPAN           20,101   33,920   30,151     60,302    90,050
UNITED STATES   15,300   24,000   30,000     70,176   132,000
UNITED KINGDOM  13,458   23,070   26,356     57,676    97,502
SPAIN            9,553   13,401   15,922     34,072    52,728
ARGENTINA        6,003    9,604   18,009     54,027    99,050
BRAZIL           1,770    4,130    8,817     29,499    58,165
CHILE            3,609    5,654    8,421     36,091    72,182
COLOMBIA         1,984    2,862    4,579     21,872    40,324
PERU             1,570    2,791    5,233     20,930    40,226
MEXICO           2,416    4,257    6,945     33,214    84,544
VENEZUELA        3,120    4,471    6,863     20,797    41,595


NOTE: Data as of February 1999. It does not include bonuses, in-kind
benefits, stock options or other incentives.
SOURCE: World Economic Forum.