02 June 1999
(Growth of 485 percent in region expected by 2000) (660) By Eric Green USIA Staff Writer WASHINGTON -- The number of Latin American Internet users is expected to grow to 34 million people by 2000, a 485 percent jump since 1997, says the chief economist of a firm that provides financial services and information in Latin America. At a June 2 press conference, Gregory Keough, founder of Zona Financiera, said that figure compares to the 72 million people in the United States now using the Internet, and 250 million worldwide. He noted that the IBM company projects a 50 fold increase in the use of the Internet for transactions in Latin America from $200 million today to more than $10,000 million a year in 2003. Keough said Internet use is at the "beginning of the curve" in growth penetration in Latin America. This means, he said, that only about five percent of the homes and seven percent of the businesses in the region have personal computers, which is considered a key to allowing people to go on-line. Keough, who was the subject of a feature article in the May issue of Forbes Magazine for starting Zona Financiera in 1997, said Internet use in Latin America is growing because it allows people there for the first time ever to "comparison shop" for products on-line. His company, headquartered in Falls Church, Virginia, with offices in five Latin American countries, offers a place where Spanish and Portuguese-speaking users of the Internet can comparison-shop for a mortgage, a car loan or insurance, as well as check stock quotes and financial news. Previously, Keough said, if someone wanted to get the best deal on a mortgage loan or obtain interest rate information from a bank, it was necessary to call or go to every single bank for that information. On the Internet, however, a person can comparison-shop at the click of a mouse switch. In addition, he added, the Internet allows people to transact a loan on-line. Keough said surveys show that Internet users in Latin America average about age 29, and the average Internet user is on line about 9.7 percent of the time per week, which is less than in the United States, but three hours more than in Europe. Some 76 percent of the users are employed, he said, which is "good news" because that means they usually qualify for financial service products. Another key statistic, he said, is that 83 percent own a credit card, allowing a customer to purchase products on-line. Surveys also show, he said, that 71 percent of Latin American users have been on-line for over a year. That means, Keough said, that Latin Americans "are getting on-line and staying on-line. They're not trying out" the system and then abandoning it. But perhaps the most "astounding" statistic, he said, is that almost 30 percent of Latin American Internet users have made a purchase on-line. "That's pretty incredible," he said, "because in the United States it took us a long time to get up" to that number. "I think it goes to a basic fact that we've seen" about Latin American consumers -- that they are twice as likely to transact a purchase on line than consumers elsewhere in the world." Keough said that internet growth "presents opportunities" for Latin America in allowing countries of the region to rapidly interact with each other and with other parts of the world in sharing information and resources." Keough noted that not all parts of Latin America demonstrate the same rate of increase in Internet use. Brazil, Mexico, Argentina, Chile, Colombia, and Venezuela have the fastest growth rates, he said, but noted that other countries, such as those in Central America, "are not lagging that far behind." Internet use in Central America is at about 250,000 people, with Costa Rica making up the bulk of that figure.