Recalibrating for 2026
HLB Survey of Business Leaders 2026 - LATAM outlook
Optimism is returning across Latin America. Nearly one and a half times more leaders now expect global growth to accelerate, and confidence at the firm level has strengthened sharply. Almost half say they are very confident about revenue growth this year, more than double last year’s level.
Policy reforms are driving both opportunity and uncertainty. In Argentina, President Javier Milei’s programme is beginning to stabilise the economy. Economic growth has reached a steady 5% growth on a yearly basis, thanks to recovering trade volumes. In Brazil, by contrast, a sweeping tax overhaul is raising questions. The move to a dual VAT regime and higher taxation on Interest on Net Equity from 2026 is forcing companies to revisit capital and repatriation strategies.
Geopolitics clearly remains a complicating factor. The United States continues to flex its muscle to advance strategic aims in the region — be it privileged access to rare earth minerals, new migration deals, or to counteract China, which has been deepening its presence through credit lines and significant infrastructure investment. Diverging choices, from Colombia joining the Belt and Road Initiative to Panama’s exit, highlight the region’s growing strategic tension.
LATAM market snapshot
of leaders are confident in their business growth for 2026.
Still, fundamentals are improving. Regional GDP growth is expected to reach 2.3% in 2026, supported by easing inflation and looser monetary conditions across most countries.
Profitability is also recovering. Twice as many LATAM leaders report margin increases of five per cent or more this year, while the share experiencing margin pressure has fallen markedly.
Three levers for growth in 2026
As volatility persists, LATAM leaders are developing a clearer growth playbook for 2026.
Our survey data points to three levers that matter most in the year ahead: sharper timing in planning and decision-making, technology-led operational agility, and a renewed focus on the customer. Together, these reflect a shift away from broad, defensive measures towards more targeted actions that translate uncertainty into momentum.
Timing and options-driven planning cycles
Prolonged volatility has encouraged LATAM leaders to deploy greater agility. Compared with their global peers, they are more likely to rely on continuous planning or short horizons of six to twelve months, reflecting the need to adjust quickly as conditions shift. In a region shaped by currency swings, political change, and external shocks, longer planning cycles often struggle to remain relevant.
Rather than abandoning planning structures, many organisations are reframing strategy as a repeatable, yet adaptive process. Transelec, one of Chile’s largest utility providers, describes its approach as a disciplined analytical cycle. In its Carta del Gerente General, the company outlines a structured assessment of internal and external variables, including market conditions, regulation, operational priorities, and long-term system needs. This analysis feeds directly into decision-making and results in a defined action plan for a fixed period (2024–2027), with an explicit intention to reassess and recalibrate rather than lock in assumptions indefinitely. Strategy, in this model, is cyclical rather than static: analyse, prioritise, decide, execute, revisit.
Decision-making styles reflect the same logic. LATAM leaders are 1.3 times more likely than their global peers to use options analysis. In volatile environments, generating multiple pathways helps organisations pivot quickly when risks materialise and move decisively when opportunities emerge.
For instance, Genomma Lab Internacional, one of the leading pharmaceutical and personal care products companies in Mexico, linked the launch of its several new products to stronger demand signals. In 2023, the company expanded the presence of key products such as Suerox®, Tio Nacho®, Novamil®, and XL-3® across multiple Latin American markets, delivering double-digit sales growth and market share gains, particularly where consumer demand began recovering after pandemic lulls or currency-adjusted slowdowns.
This emphasis on options does not imply indecision. On the contrary, profit accelerators — firms that increased margins by five to ten per cent or more over the past year — appear more decisive than the broader cohort. While many organisations use options and scenarios to inform longer-term thinking, higher performers are more likely to operate on adaptive planning cycles that translate analysis into action more quickly.
Across the region, decision-making remains highly centralised. LATAM leaders continue to favour executive-led models, combining faster planning cycles with clear accountability at the top. In an environment where timing matters as much as direction, agility is proving most effective when paired with strong leadership control.
Tech-led operational agility
Faster planning cycles are sharpening the focus on execution. While 58% leaders still cite operational efficiency as a priority, the decline from 71% last year suggests that many have already made measurable progress. Cost reduction is also becoming less urgent, pointing to a shift from defensive measures towards more selective investment.
What remains constant is the role of technology as a driver of growth. New technology adoption continues to rank among leaders’ top priorities year on year. In LATAM, this focus builds on a decade of rapid digitisation, now reinforced by growing multinational investment. Major commitments such as AWS’s US$4 billion investment in a new Chilean cloud zone and Microsoft’s US$2.7 billion expansion of cloud and AI infrastructure in Brazil are strengthening local ecosystems and expanding the region’s technology talent base.
This growing footprint is shaping how LATAM firms pursue innovation. Compared with global peers, regional leaders are more likely to seek joint ventures and strategic alliances, a tendency that may accelerate as multinational presence deepens. Access to stronger infrastructure and tech skills is lowering barriers to adoption and enabling more ambitious transformation efforts.
LATAM AI adoption
of leaders now report no AI use within their business, down from 27% last year
LATAM Airlines, for instance, recently migrated 95% of its infrastructure to Google Cloud, gaining greater agility in deploying new digital solutions.
The move laid the foundation for deploying a virtual assistant, powered by cloud-based AI, enabling customers to search flights, manage bookings, and access personalised recommendations across travel services. The result is a more responsive platform and a smoother customer experience.
Even with high AI adoption in the region, leaders recognise that the journey is far from complete. This year, 32% plan to address gaps in digital and AI capabilities, while almost a third aim to strengthen cybersecurity. Two-thirds also intend to increase spending on digital transformation and emerging technologies, alongside greater investment in business intelligence and AI-driven decision-support tools.
The aim is clear: sharper strategic insight, stronger execution, and closer alignment with customers.
Customers as the growth engine
To grow in the next 12 months, over half of leaders in the region are prioritising their focus on customers. This reflects a shift in where growth is coming from. While global markets remain uneven, stronger domestic demand has provided a counterweight. In the first half of 2025, rising local consumption in Argentina, Peru, Colombia, Chile, and Brazil supported business performance across sectors.
With unemployment hovering at the lowest levels since the start of the decade and minimum wage increases in several counties, local consumers gained higher purchasing power. The middle class now represents 42.8% of the population, and poverty levels have fallen to historical lows of 25.2% according to a new World Bank study. These dynamics have created a more resilient domestic consumer base.
Yet, just like their global peers, LATAM consumers are redefining how and where they spend. In our survey, we asked leaders what they recently learned about their customers, and their responses revealed significant shifts. “They demand efficiency, shorter turnaround times, and competitive pricing,” shared a CEO in the Education sector. While a CISO in the technology sector noticed that “they change their habits temporarily and without any certainty.”
What have leaders recently learned about their customers?
“The most important thing I've learned recently is that my clients, whether businesses, cities, or households, greatly value not only energy service, but also trust and support as strategic allies in their efficiency and sustainability. Innovation, agility in service delivery, and the design of solutions tailored to their needs are key to strengthening this relationship and exceeding their expectations.”
COO at a publicly-listed energy sector company
Other common themes included demand for greater responsiveness, personalised solutions, empathy and professional treatment at every touchpoint. To build loyalty in this environment, nearly three-quarters of leaders plan to increase spending on customer analytics, segmentation, and personalisation. Profit leaders intend to go further, allocating even more resources to customer-facing initiatives. The aim is not simply to lower prices, but to deliver clearer value for money through a better understanding of customer needs.
Mercado Libre provides a clear example of this approach in Brazil. By lowering its free-shipping threshold, in response to feedback from customers, the company achieved a 42% YoY increase in items sold and a 29% rise in unique buyers, the largest quarterly addition in its history. Within its fintech arm, Mercado Pago has taken a similar path, using customer experience to drive retention, reduce delinquency and deepen cross-sell. High engagement through QR payments and remunerated balances has strengthened the platform’s expansion, including efforts to improve financial inclusion in Argentina.
Customer involvement is also reshaping innovation. Almost three-quarters of LATAM leaders plan to focus more on customer-driven innovation, using early feedback to reduce risk and validate demand.
Natura’s long-running open innovation model illustrates the benefits. Since 2015, the cosmetics company has been using customer feedback to co-create new products. During the “Viva Sua Beleza” project, the brand sourced over 200 creative ideas from consumers over 90 days. It resulted in a natural product line shaped by consumer input from concept to formulation. By co-creating products with consumers, the company has consistently delivered launches with strong market acceptance and sustained brand leadership.
Looking ahead, LATAM leaders expect growth in 2026 to be defined by the strength of customer relationships. As a result, most plan to increase investment in customer experience enhancement initiatives over the next year, reinforcing the view that sustainable growth will be built closer to the customer.
How profit accelerators stand out in LATAM
In LATAM, sustained profitability appears to be built on a combination of operational confidence, disciplined technology adoption, and a markedly stronger focus on the customer.
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LATAM companies with the strongest margins are shifting decisively from defence to expansion. Their main focus areas for 2026 are new product/services development and expansion to new markets despite ongoing uncertainty.
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While many peers take a more cautious, scenario-led approach to long-term planning, these firms are more likely to operate on adaptive planning cycles, likely to better position themselves to profit from emerging opportunities.
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Their ability to move quickly is enabled by a deeper use of advanced technologies. Half have already deployed AI in core functions such as research and development, customer service, content generation, and performance management, compared with far lower adoption among peers.
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Their approach to technology is also more targeted. Profit leaders place greater emphasis on addressing specific cybersecurity gaps rather than broadly upgrading digital or AI capabilities, recognising that secure systems are a prerequisite for scaling innovation.
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Customer investment is the clearest differentiator. Profit leaders plan to increase spending on customer experience enhancement, analytics, personalisation, and customer data security at rates around 30 percentage points higher than the rest of the cohort.
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