According to the risk agency, 70% of companies in the region have moderate exposure, 17% have a slight impact and only 13% of companies should be more affected by the new rate
With the beginning of the collection of new import rates in the NOS, Moody’s considers that the corporate sector in Latin America has moderate exposure to the measure imposed by the government of. According to the risk agency, 70% of companies in the region have moderate exposure, 17% have a slight impact and only 13% of companies should be more affected by the new rate. The agency analyzed about 3,500 non -financial companies with rating worldwide, including 140 in Latin America, to evaluate its vulnerability to US tariff risks. For these, even, the classifier recalls that the biggest exhibition of them is to. “Persistent commercial uncertainty will be more difficult for Mexico exporters than to those of other large economies in Latin America, which depend more on commodities than manufactured items,” Moody’s said in a report.
According to the agency, the region’s exposure to US commerce mainly involves companies with direct trade relations with that country, such as car and aircraft manufacturers. “The US announced in July, tariff exemptions for certain products, including civilian aircraft. Auto parts suppliers have one of the largest exhibitions to new US tariffs, mainly because of the consumer stress that rates would cause the country’s automakers,” Moody’s said. Macroeconomic exposure is high for Latin American commodity producers dependent on exports, but these companies still maintain some advantages over their counterparts in other regions, the risk agency said.
According to Moody’s, consumer, telecommunications and airline companies are susceptible to changes in macroeconomic conditions. As a result, US fares will reduce economic growth rates in most Latin American countries, which will overload employment rates, discretionary income and consumption in different sectors and countries. “About 21% of Latin American companies with rating have high exposure to macroeconomic factors.” The agency stressed that in general, US tariff risks have limited credit effects of most Latin American companies with rating. Only 9% have direct exposure to trade, 21% to macroeconomic shocks and 10% to financial volatility.
Moody’s stressed that Mexico and Brazil face higher US fares than other countries in the region. “Brazil, for example, is subject to a new 50% rate from August 1, although the US has announced exemptions for products such as civil aircraft and orange juice. Chile stands out for its high macroeconomic exposure, especially in the metal, chemicals and forest products,” the agency said. The classification, however, recalls that some Brazilian products have entered the tariff exception, including items that benefited Embraer.
*With information from Estadão Content
Posted by Fernando Dias
