Your Portfolio Better Get Ready to Habla Espanol o Portugues

After China/India, Latin America is the region capturing the greatest attention from corporate America. The region is being touted as the spark that could ignite greater global economic growth. Many companies are keen on grabbing the opportunity with both hands.

The latest to realize this is Netflix (Nasdaq: NFLX). After entering Canada last year, the company has decided to start streaming Internet video in 43 Latin American and Caribbean countries this year. The decision is an attempt to tap a market expected to have the fastest growth in Internet connections by 2015, something that has the potential to directly impact Netflix's steaming video services.

The company's announcement aroused my curiosity as to what makes Latin America so attractive and, more importantly, which companies are making a beeline to put their flags in the region now. 

The growing region
In the face of global economic troubles, the region is showing a lot of promise, after seeing a 30-year-high growth rate of 6% last year. Output growth last year stood second only to that of a fast-emerging Asia. The International Monetary Fund expects Latin America to grow at 4.6% in 2011 and 4.1% in 2012, significantly higher than North America. The region's domestic demand has been rising, and is expected to be the catalyst for future growth.

It's worth noting China's increased interest in Brazil. China has been Brazil's main trading partner for several years, and the relationship is all set to get stronger with China investing another $9 billion in the country this year, with half in the technology sector. Brazil constitutes almost 40% of Latin America's total economy and China has already claimed its stake.

Many companies are either already in or gearing up to be in the region. The best part is that Latin America is proving to be fruitful for the companies.

Enjoying the Latin benefit
Latin America has been acting as a revenue booster for companies doing business in the region. Google's (Nasdaq: GOOG) revenues from the region grew a staggering 80% last year, beating all other markets, as well as fueling the company's plans of expanding further in the area. Frost & Sullivan has also recognized an increasing trend in IT revenues over the past couple of years, suggesting the growth will continue.

Similarly, satellite television provider DIRECTV's (Nasdaq: DTV) revenues last quarter were boosted on the back of a record number of subscribers from Latin America, giving the company a chance to present better forecasts for the business growth in the region.

General Electric's (NYSE: GE) revenues from Latin America surged 30% in the last quarter from a year ago, making the company highly positive about the region. Revenues from the region are expected to grow at an annual rate of 20% or more in the next five years.

In general, companies are riding the consumption wave in these markets. Avon Product's (NYSE: AVP) robust recent quarterly numbers strengthen that argument. The company's bottom line grew more than threefold, helped largely by higher volumes and prices in Latin America.

There seem to be strong reasons for companies to set up a stronger base in the region, and the craze has hit companies across almost all the industries. France's Total SA (NYSE: TOT), for instance, recently confirmed its plans of entering into Brazil's subsalt oil fields as soon as the country opens up auctions.

Israel-based pharmaceutical company Teva Pharmaceutical (Nasdaq: TEVA) announced the acquisition of a Peruvian company earlier this year, signifying its continuous bid to expand in the region.

Food major Kraft Foods also has plans to invest heavily in Latin America, after witnessing surging demand for its products like Tang in the region. Retailers are also pinning hopes on these countries for growth and expansion.

Given the way the region has been coming up, these companies seem to be on the right path. Going the Latin way is expected to do well for them; at least investors can hope so.

The Foolish bottom line
With the way Latin America is boosting revenues for companies, and given the optimistic forecasts for growth, all I can say is, if you come across a company that has plans of entering or foraying deeper into the region, you now know of a few reasons why you may like to keep an eye on that company and its stock.