Latin America’s booming renewable energy investment: temporary or permanent?

As world economic leaders converge at Davos, Switzerland, this week to discuss climate change, there is a noticeable under-representation from Latin American heads of state. The leaders of Latin America’s biggest economies (Brazil, Mexico and Argentina), as well as other prominent states (such as Chile and Bolivia), are reportedly not attending. Yet, this is a region which has recently become the second-largest site for investment in renewable energy. Typically dominated by Europe and Asia-Pacific, installed capacity has been rising at an average rate of 37.2% between 2010-2018. However, even though Latin American countries are among three of the top five destinations for renewable energy FDI in the last two years (figure 1), its long-term projection should be queried. Is this a long-term trend or the result of global instability in emerging markets? Furthermore, even if it is indicative of future potential will recent political instability in the area stifle investment before it ever gets the chance to mature?