Argentina and Colombia are the second- and third-largest markets respectively, while Uruguay and Paraguay are the smallest.

The major multinational coatings companies have a strong presence in South America and continue to invest in the market, via organic growth and also through strategic acquisitions. Official population statistics give a per capita paint consumption of 7.1 kg for the South America region as a whole, with the highest levels seen in Brazil and Chile. Bolivia has the lowest paint consumption per person.

Despite starting from a small base, Bolivia is expected to show the fastest growth in its coatings market over the medium term (around eight percent per annum), followed by Chile and Uruguay.

There are several key drivers behind the expected future growth in the South American market. These include:  the growth of the oil and gas industries and alternative energy projects such as thermoelectric, hydroelectric and wind power; investment in the mining sector; the Football World Cup taking place in Brazil in 2014 and the Olympic Games in 2016, which will bring significant investment to improve infrastructure; government social housing programs to address housing deficits; and rising car ownership, due to greater spending power and higher living standards.

South America’s coastline provides opportunities for the marine coatings industry. Brazil’s Petrobras is currently modernizing its tanker fleet. Chile is the world’s second-largest salmon producer, and Peru has the second-largest fishing industry in the world.

South America continues to face challenges as well, arising from political, economic and social instabilities. Problems facing the coatings industry include:  reliance on imports for many raw materials required for paint production, e.g. resins and pigments; lack of regulation concerning environmental aspects of coatings, which can undermine consumer confidence in product quality; corruption at government and industry levels; the nationalization program in Venezuela, which has forced many investment projects to be put on hold; and Argentina’s controversial nationalization of the oil company Yacimientos Petrolíferos Fiscales and its expropriation from Spanish energy firm Repsol.

A Profile of the South American Paints Industryincludes market data for 2011 and forecasts to 2016 for each country included in the report, plus a SWOT analysis of the South American coatings industry overall and market splits by end-use sector. It also outlines the key industry players in each country and shows key trends in the decorative and industrial segments. Visit www.informationresearch.co.uk for additional information.

IRL, a division of Business Research Group, offers a comprehensive range of marketing research and analysis services to the global coatings industry.