When U.S. and European economies tanked in 2009, many multinationals turned their attention to Latin America as a source for growth. Brazil in particular became hot.

But now, as the U.S. market rebounds and Brazil’s economy sags, many in Corporate America see chances for growth elsewhere and are re-thinking plans for Latin America.

That shift raises a key challenge for the multinational executives running those Latin American operations: How to keep corporate headquarters engaged in tough times and keep budgets flowing to the region?

Gustavo Sorgente, managing director for sales for Central America, northern South America and the Caribbean for software maker Cisco Systems, explored that question at WorldCIty’s CEO Club on Dec. 5 in talks that touched on differences in time horizons and rising competition from Chinese companies.

“If Latin America is a focus, it shouldn’t be because the United States or Europe is going down. It should be because Latin America has long-term growth potential,” said Sorgente, speaking in his personal capacity and not as a representative of Cisco.

“To be positioned in a country [in the emerging Latin American region], you have to ride the waves,” said Sorgente. “If you pull back, you are going to miss the next wave up.”

Shifting perceptions about Latin America

Sorgente sees the challenge arising partly from misperceptions about Latin America at many corporate headquarters. Too often, senior U.S. executives see the region as “unstable” and “unpredictable,” just because its emerging economies tend to swing through bigger cycles than mature economies do.

“It’s not linear,” said Sorgente of Latin America’s growth. But that “doesn’t mean lack of stability.”

Corporate America also tends to focus on short-term results, influenced partly by Wall Street. But Latin America’s cycles demand more of a long-term view and long-term commitment, said Sorgente.

“Getting embedded in the local markets is probably the way to go,” Sorgente told the group. In dollar-short Venezuela, for example, companies selling to the local market in local currency are prospering.

Sorgente is bullish long-term on business in Latin America for lots of reasons: a young and growing population now around 600 million people, an expanding middle class, improved financial management in most nations and ample wealth in minerals and other commodities.

A premium or a cost for loyalty?

U.S-based multinationals are more comfortable nowadays with the idea of “embedding” in Latin America for the long-term than they were decades back, said Lorena Keough, a managing director in Miami with retained executive search firm Diversified Search.

In the past, some multinationals would literally pull up stakes when times got tough in Latin American markets. But now, there’s a greater understanding that it costs more to leave and then re-enter the market later. Plus, there’s a premium gained from consumers and governments for staying loyal, said Keough.

Still, loyalty can come at a high price, participants said. For example, airlines now are owed hundreds of millions of dollars from Venezuela, and many producers in Argentina face hurdles to obtain imports.

Financial markets don’t tend to reward long-term commitment to the region either. When a U.S.-based company pursues an acquisition in Latin America, that purchase tends to worsen the risk profile of its shares – even when the acquisition will bring growth, said Enrique Lopez-Negrete, managing partner of business brokers Sunbelt.

Chinese companies don’t face the same constraints to expand in Latin America. Their managers tend to look longer term, partly to secure oil, metal and other basics for decades to come. Plus, they’re looser than U.S. multinationals in how they conduct business, participants agreed.

One example of the U.S.-Chinese contrast: Sunbelt was selling a mining company in Latin America, and both a Chinese buyer and a U.S. buyer were interested. The first to send a deposit would get the edge. The Chinese firm immediately sent in the cash – with no contract and no receipt requested. The U.S. company could never act that fast because of its compliance procedures, said Lopez-Negrete.

“It’s a question of long-term versus short-term,” emphasized Sorgente.

Managing expectations at corporate headquarters

To be sure, the short-term for Latin America does not look rosy.

Brazil slipped into recession this year, and the Rousseff administration is discussing austerity plans. Visions of a Mexico takeoff also have dimmed, as the Pena Nieto government has moved slower than hoped on reforms, participants said.

“With the world economy improving, Latin America now does not compare as well as it did,” said Jose Gelabert-Navia, regional director for Latin America for architecture firm Perkins + Will. He had been asked to develop business in Latin American region in 2009, when the recession hit hard at U.S. sales.

To keep budgets flowing to Latin America, it pays to manage expectations carefully at corporate headquarters and avoid hype, said George Calienes, senior vice president of Latin American operations for air-conditioning maker Daikin Applied.

“If you portray the region as difficult, if you’re too pessimistic, they shut you down,” Calienes said. “If you’re too optimistic, you create too high expectations. So you have to walk a fine line.”

Sorgente said he’s learned to de-emphasize Latin America’s peaks and valleys with corporate brass.

“It starts with is selling the region in a different way,” said Sorgente. “It’s not going to be great. It’s going to be cloudy. But that’s ok. There’s great opportunity long-term.”

Placing too much emphasis on immediate gains can backfire, agreed Fernando Campo, senior vice president at software maker Citrix Systems for all the Americas, including the U.S.

“Our problem is that we sell Latin America short-term,” Campo told the group. “Tempering the message and making it a little more stable helps a lot.”

The CEO Club is one of six event series organized by media company WorldCity to bring together executives of multinational companies in greater Miami. The CEO round-tables are sponsored by the University of Miami School of Business Administration and real estate company CBRE.

The next CEO Club is set for Feb. 6.