Globalization and restructuring the energy sector in Latin America

This article analyses the main manifestations of the globalization process and its implications in terms of the restructuring of energy markets. The reforms now being undertaken by the countries of the region are being pursued within the context of an economic paradigm with ramifications at the international level which assigns high priority to the liberalization and/or privatization of public utilities, and this, in turn, can be expected to engender new savigs/investment strategies based on the relatively more stable nature of income flows from energy activities. The introduction of competition (when the characteristics and size of the market in question so permit);, the regulation of natural monopolies, the presence of private firms and of institutional investors, and the ascendancy of the aim of running a profitable business venture over the conventional view of utilities as public services can all be expected to boost the formation, reproduction and diversification of capital, thereby galvanizing financial markets and opening up new opportunities for attracting external resources. The restructuring of energy markets may promote growth by opening up new financing options and increasing the mobility of income streams and, in so doing, will reshape the macroeconomic impact of the energy sector.