Back to the 19th Century? The Current Commodities Boom and the Primarization Process in Latin America

Latin America experienced strong economic growth between 2003 and 2007 due to a boom in the prices of primary goods. Net terms of trade have shifted in benefit of raw materials. The vigorous global demand for primary products, furthered by the high growth rates of Asian nations, is a unique opportunity for restructuring the economies of the region. The latter could undertake a thorough process of reindustrialization based on the domestic market. Nevertheless, national power groups would be opposed, as would foreign companies operating in key sectors which extract large quantities of resources. This article analyzes three possible results of the boom in primary goods. A return to the dependence of the 19th century seems the most likely.