How to start exporting to Latin America

However, Canadian businesses need to understand a few key challenges to succeed in Latin American markets. Unlike exporting to Europe, for instance, companies operating in Latin America often have to contend with more volatile exchange rates.

And although the region is geographically closer and perhaps more culturally familiar than other major export destinations like Asia, its business culture still differs from Canada’s in significant ways.

Ultimately, like any export venture, succeeding in Latin America comes down to thorough preparation.

What are the key benefits and opportunities of exporting to Latin America?

Latin America’s economy has more than doubled over the past 20 years, creating a rising middle class and new opportunities for Canadian exporters. “Latin America holds significant untapped potential for Canadian businesses, such as dynamic markets, a growing middle-class consumer base and strategic partnership opportunities,” says Allison Thorne, a business advisor with BDC Advisory Services. With its rich natural resources, emerging technology hubs and increasing demand for high-quality goods and services, the region presents a gateway for Canadian companies to diversify, innovate and strengthen global competitiveness.

High-demand sectors include:

• mining
• energy
• infrastructure
• agri-food
• education
• technology and digital services

Following the 2025 geopolitical and economic tensions, Latin America started to rethink its trade relationships, says Thorne. Many countries in the region are trying to reduce their dependence on the United States and China. This means they are looking for new trade partners, and Canadian companies could step in to fill the gap and meet the region’s growing demand for goods and services. Here are the main advantages of exporting to Latin America.

• Geographic proximity
  Latin America covers a vast and diverse area in our hemisphere. This geographic proximity can allow goods to be shipped quickly and more cost-effectively, providing Canadian exporters with a significant logistical advantage.
  
  Additionally, being in similar time zones allows Canadian businesses to communicate and collaborate with their Latin American partners more efficiently.  “This overlap in working hours is especially beneficial for sectors such as engineering, education and professional services, as it enables real-time problem-solving and decision-making without the delays caused by major time differences,” underscores Thorne.
• Easy access through bilateral free trade agreements
  Canada has several bilateral free trade agreements with Latin American countries that make it simpler for exporters to enter these markets. Reduced tariffs, streamlined customs procedures and stronger legal protections help create a more predictable trading environment, lowering barriers for Canadian companies and helping them compete effectively.
  
  Here are a few important trade deals that Canada has concluded in the region:
  • Canada-Chile Free Trade Agreement (CCFTA) – In force since 1997, the CCFTA eliminates most tariffs and promotes trade in goods and services.
  • Canada-Peru Free Trade Agreement (CPFTA) – Effective since 2009, the CPFTA provides preferential access to Peruvian markets and strengthens investor protections.
  • Canada-Colombia Free Trade Agreement (CCOFTA) – Active since 2011, the CCOFTA reduces tariffs on Canadian exports and facilitates market entry.
  • Canada-Panama Free Trade Agreement (CPAFTA) – In force since 2013, the CPAFTA covers market access for goods, cross-border trade in services, telecommunications, investment, financial services and government procurement.
  • Canada-Costa Rica Free Trade Agreement (CCRFTA) – Effective since 2002. The focus of the CCRFTA is largely on goods, with limited coverage of cross-border services, financial services, investment, or government procurement.

Canadian businesses also have access to the Mexican market through the Canada-United States-Mexico Agreement (CUSMA).

• Strong desire to do business with Canada
  Latin American businesses and governments are increasingly interested in Canadian products, technologies and services. This openness provides Canadian companies with a receptive market and multiple opportunities to establish partnerships, expand networks and grow their international presence.
  
  “Latin American companies are eager to do business with Canada, a reflection of our country’s solid global reputation,” says Thorne. “While Canadian products are valued in many markets, this enthusiasm is particularly strong in Latin America, making it an attractive region for exporters.”
• Favorable demographics
  Latin America has a young population, with a median age just above 30. This helps create a strong labour force and a growing consumer base. About 80% of the region’s population already lives in urban areas, and the number is expected to rise by roughly 115 million between 2025 and 2050. As more people move to cities, there is a greater need for infrastructure, technology, consumer goods and professional services, creating significant opportunities for Canadian exporters.
  
  Because the population is young, increasingly urban and earning more, Latin America is an attractive market for companies that want to grow internationally and establish long-term partnerships.

What are the main risks and challenges of exporting to Latin America?

Latin America is a diverse region, with significant differences in culture, regulations and economic stability across countries. These variations can create challenges for Canadian exporters, from navigating complex regulatory environments to managing currency fluctuations and local business practices.

Here are the main risks and challenges to keep in mind as you plan your expansion into the Latin American market, along with practical strategies to address them.

Challenge: access to market data

To be successful in Latin America, it’s important for exporters to really understand the market they want to enter. Exporters must navigate complex regulations, evaluate demand and assess consumer preferences. While the market may not be as saturated as Asia or Europe, gathering accurate and relevant data remains one of the most important challenges in preparing to export to Latin America. “There’s a lot of room for growth and competition, but success depends on how well companies prepare and understand the market before entering,” says Thorne.

Solution: market research and partnerships

To succeed, business owners should take a data-driven approach rather than relying on instinct, as they might in their home market. This means conducting detailed market studies and collaborating with local partners or specialized advisors to understand demand, competitive dynamics and potential opportunities. Engaging local consultants, legal experts or on-the-ground sales agents and distributors can help streamline the process and make market entry more effective.

Key resources for market data

Challenge: managing transparency and governance risks

Compared with Europe, some Latin American markets can pose greater challenges around transparency and business practices. Companies may encounter informal or non-standard practices, or face requirements that differ from the regulatory and ethical norms they are accustomed to in Canada.

Solution: engage experts and local partners

Collaborating with distributors, agents and legal professionals who understand the regulatory landscape can help mitigate risk. “Consult the Trade Commissioner Service (TCS),” suggests Thorne. “The TCS, along with other specialists, can provide guidance on selecting reliable partners and navigating government policies, helping you avoid unnecessary risks.”

Challenge: volatile exchange rate and higher interest rates

Exporters may face unpredictable exchange rates and higher interest rates in some Latin American countries. These conditions may affect costs, pricing and profit margins, making financial outcomes less predictable and increasing the complexity of doing business in the region.

Solution: use the right financial tools

Canadian exporters can manage the risks of fluctuating exchange rates and higher interest rates by using a range of financial tools. Currency hedging instruments, such as forward contracts and options, can help stabilize revenue and protect profit margins. “Programs such as the Foreign Exchange Facility Guarantee offered by Export Development Canada (EDC), for example, protect your profits against foreign exchange risk,” says Thorne.

Additionally, working with financial institutions to access export financing or flexible credit solutions can improve cash flow and reduce uncertainty when entering Latin American markets.

Challenge: cultural and language differences

Cultural differences can hinder effective communication and marketing efforts. While the barriers are not as high in Latin America as in Asia, they can still create misunderstandings and slow down negotiations.

Solution: adapt to local practices

Canadian exporters should take a tailored approach to navigate cultural and language differences and avoid misunderstandings or missteps. “Business in Latin America is deeply relationship-driven,” explains Thorne. “Trust and personal connection will often outweigh formal agreements when it comes to doing business in the region.” Building rapport is essential. Invest time in face-to-face meetings and nurture relationships before diving into deal details. Furthermore, decision-making is often concentrated at higher levels within companies, so engaging key decision makers early can help move deals forward more efficiently.

To overcome language and cultural barriers, don’t hesitate to invest in cross-cultural training. Consult The Culture Factor’s Country comparison tool to identify key cultural differences between Canada and your target country. Also, whenever possible, hire multilingual or multicultural staff, and find knowledgeable experts to translate and adapt your marketing material. 

What steps should business owners take to start exporting in Latin America?

To enter the Latin American market successfully, careful preparation is essential. Begin with these practical steps, which will help you assess the market, shape your strategy, and establish a strong foundation for your operations on the continent.

1. Assess your export readiness

Begin by evaluating your organization’s internal capabilities. Can your team, financial resources and operational processes handle the additional demands of exporting? Consider whether expanding into Latin America could dilute your local presence or stretch your resources too thin.

2. Select your target market

Analyze which Latin American market offers the most viable opportunities. Consider market size, geographical proximity, import demand and competitive landscape. Resources like Trade Data Online—a public platform that generates customized reports on Canada’s trade of goods with over 200 countries—can help focus your efforts and guide your strategy.

3. Understand regulations and compliance requirements

With regulations varying from country to country, you need to zero in on the rules that may apply to your product or service. Check for necessary certifications or standards—this is where collaborating with local experts can often save you time, money and missteps.

4. Plan your pricing and logistics

Develop your pricing, distribution and logistics strategies. Identify potential partners and sales channels. Understanding customs procedures and choosing reliable brokers are also key components of a solid operational plan. Look for initiatives such as the Trade Accelerator Program, which offers international trade workshop sessions across the country.

5. Seek funding and support

Explore export grants or funding programs available through federal, provincial or industry associations. These resources can help reduce your costs and provide valuable guidance. For example, through the Trade Commissioner Service’s CanExport SMEs program, eligible businesses may receive up to $50,000 to support the costs of international business development activities in markets where they have little or no existing sales.

6. Engage directly on the ground

Visit the target region in person. Attend trade shows. Join trade missions, whether through industry events or federal and provincial business delegations. Consult the Trade Commissioner Service website for a sortable list of upcoming trade missions and events.

7. Begin exporting

Start small and scale gradually. Launch initial shipments or pilot projects to test the market, refine your processes and build relationships with customers and partners before committing to larger operations. E-commerce platforms can be a great way to gauge interest, helping you test demand, learn from customer feedback and refine your approach before scaling up.

Next step

BDC’s experts in business expansion can help you shape a winning export strategy and access a world of new customers.