Latin America is a continent bursting with potential, with a growing affluent and informed consumer base and a regulatory environment that is increasingly conducive to business. David Pineda Ereño, Managing Director of DPE International Consulting, discusses some of the opportunities and challenges to launching products in the region, from a regulatory point of view.
February 18, 2021
“Latin America is one of the most dynamic and diverse regional markets in the world,” says Pineda. “With increasing consumer demand, it offers many opportunities for food and beverages businesses”.
In common with other regions of the world, health has become a key driver. Higher incidences of obesity, diabetes and heart disease for example, are leading to consumer demand for natural, healthy and organic products.
A key trend in recent years has been more regulation, designed in part to boost consumer confidence and safety. This has not always made it easy for businesses. A diverse range of front-of-pack warning labelling systems for example, require companies to adapt products labels to national requirements. A critical consideration for businesses therefore is understanding the specificities of each country, while recognising a general trend towards greater regulatory harmonisation.
Steps have indeed been taken in this direction. Two key trade blocs have emerged in the region - the Mercosur trade bloc (composed by Argentina, Brazil, Bolivia, Paraguay and Uruguay), and the more recently formed Pacific Alliance (composed of Chile, Colombia, Mexico and Peru). In the case of Mercosur, several pieces of regulation have been harmonised to cover specific product categories as well as horizontal aspects such as labelling and additives, while the Pacific Alliance is working to develop harmonised rules on foods and beverages.
“It is worth considering that there are harmonised horizontal (e.g., food additives and labelling) and food commodity regulations in some of the trade blocs in the Latin American region,” says Pineda. “Nonetheless, companies still need to take into account the fact that food regulations have been mainly developed at the national level. Businesses therefore need to navigate across diverse regulatory frameworks, if they are to evaluate and identify important developments and business opportunities.”
The basis for any successful product launch strategy in Latin America is therefore to have a clear understanding of the sheer diversity of regulations across the different markets. Companies need to be able to develop regulatory strategies tailored for individual countries and products.
Even within Mercosur member countries, there are different regulatory entry requirements and procedures.
“In this sense, it is also necessary to explore the specific opportunities that have arisen from the EU-MERCOSUR Agreement and its application to specific food categories,” adds Pineda.
DPE International Consulting is an international consultancy firm that provides strategic and regulatory advice on the policy, regulation and trade of foods and beverages to companies, trade associations, and government bodies at national, regional, and international level in Europe, Latin America and the Caribbean, Asia, Middle East and Africa, and the USA. This includes the work of international intergovernmental organisations such as the Codex Alimentarius Commission, the World Trade Organisation, the Southern Common Market (MERCOSUR) and the Pacific Alliance, among others.
