The agonising dilemma of Spanish firms in Latin America

THIS IS A year of poignant anniversaries in Spain’s relationship with Latin America. Exactly 500 years ago Hernán Cortés launched his conquest of Mexico. In 1939 Mexico’s left-wing president, Lázaro Cárdenas, opened the door to Spaniards fleeing fascism at the end of the civil war. It might have been a celebratory year for Spanish business, too. In 1989 Telefónica, Spain’s biggest telecoms firm, made its first incursion into Latin America by bidding for a Chilean counterpart, unleashing a flood of Spanish investment into the region in the 1990s known as la reconquista. Instead, it has been a year of pot-banging protests and economic turmoil in the region. It says a lot that 30 years after it planted the flag, Telefónica has decided to cut its losses in the former Spanish colonies, and may sell its businesses there altogether.