Latin American opportunities on the riseWith U.S. medical imaging system shipments slumping 3% in 1993and potentially declining by as much as 5% this year, internationalsales provide some good news for American manufacturers. U.S.imaging
With U.S. medical imaging system shipments slumping 3% in 1993and potentially declining by as much as 5% this year, internationalsales provide some good news for American manufacturers. U.S.imaging vendors have an advantage in approaching one of the brightestof the international bright spots, Latin America, according toMorgan W. Nields, chairman and CEO of Denver-based Fischer Imaging.
Nields spoke at the Diagnostic Imaging conference in San Franciscolast month, entitled Opportunities for the Imaging Industry: Prospectsand Challenges in the `90s (see story, page one).
U.S. medical imaging exports have doubled over the last fiveyears, according to Nields. Exports of imaging equipment amountedto almost $2.3 billion in 1993, up from just over $1 billion in1988.
Western Europe received almost half of U.S. medical imagingexports last year, while Japan counted for only 13%, Nields said(see chart). This contrasts with Japan's economic potential, whichis about half that of Europe. Japan takes a greater percentageof worldwide medical imaging sales due to the business of Japanese-basedsuppliers.
While there has been much industry discussion of Chinese salespotential, the China market accounted for only 3.3% of U.S. medicalimaging exports last year, he said. Latin America, on the otherhand, took 11% of U.S. medical imaging exports in 1993, up from7% in 1988.
While Latin America holds great potential for all imaging suppliers,U.S. firms in particular benefit from the growing momentum ofregional free trading pacts, he said.
The North American Free Trade Agreement will give U.S.-basedfirms a considerable advantage by circumventing the 10% duty ratesin Mexico. In addition, fast-developing Chile could join NAFTAwithin a year, with Argentina not far behind and Columbia andVenezuela on the horizon, he said.
"By the year 2000, I predict that we will have a freetrade zone in the Western Hemisphere. By that time, this willoffer a market of about 900 million people, all within two timezones of most places in the U.S.," Nields said.
Existing trading blocs among Latin American countries are fasttrimming by half the protectionist duty rates that were formerlyaround 40%, he said. Privatization is on the rise, led by Argentina,with Mexico close behind. Even Bolivia has gotten into the privatizationact through the formation of a giant public employee stock optionplan.
Democratization and economic growth are moving in tandem inLatin America. The fastest growing countries are Chile, Argentinaand Mexico. Double digit economic growth has been realized inmost cases, with inflation rising at only 5% to 8% a year. Thiswas unheard of in the region five years ago, Nields said.
"This (Latin America) is one of the best near-term opportunitieswe have in imaging," Nields said.