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Survey: Businesses Leaders Operating in Latin America & Caribbean View Rule of Law, Free Trade as Critical for Economic Growth
WASHINGTON, D.C. — A majority of business leaders operating in Latin America and the Caribbean are optimistic about the future, but they view widespread shortcomings in the rule of law as an inhibitor to growth and want the U.S. to make free trade and economic integration a priority, according to a special 50th anniversary edition of the Business Pulse Survey, released today by the U.S. Chamber of Commerce and the Association of American Chambers of Commerce in Latin America and the Caribbean (AACCLA).
The survey, which polled more than 600 business leaders representing companies doing business in the 28 markets that make up the AACCLA network, found that a majority of business leaders (53 percent) are optimistic overall about the next four years and that a majority (65 percent) also expect the region’s economy to grow up to 4 percent.
On matters of regional economic policy, the survey revealed that rule of law remains a major concern for businesses operating in the region; 31 percent named it the “most important” issue to address. Further, when presented with eight key issues, nearly half of those surveyed (45 percent) said strengthening the rule of law and fighting corruption are most important in the short term for enhancing economic growth. Nearly two-thirds of respondents characterized the rule of law in the region as “adequate but deteriorating” or “poor,” and 40 percent identified weak institutions and corruption as the key issue influencing the future of the region.
Business leaders who participated in the survey identified a number of other core challenges facing the region. For example, a cumulative 90 percent of respondents said customs laws and procedures in the region are inconsistently applied, inadequate in meeting objectives, or overly restrictive to trade; and nearly half said the region doesn’t understand the importance of intellectual property.
“The candid, informed responses that we received from across the hemisphere provide the foundation we need to set policy priorities as AACCLA embarks on its next 50 years,” said Jodi Hanson Bond, senior vice president for the Americas at the U.S. Chamber. “Far and away, AACCLA stakeholders believe the rule of law is the primary issue the region must address. That’s understandable considering how difficult it is today to find a country in the region that isn’t confronting rule of law challenges, and too, considering how significant an impact improvements could have on economic growth throughout the hemisphere.”
The survey also offers insights on the views of the region’s business leaders toward the U.S. — its private sector, government, and policy priorities. Seventy-two percent indicated a favorable view of the U.S. private sector and U.S. investment. However, fewer respondents (38 percent) have a favorable view of the U.S. government, and when asked for their perspective on relations between the U.S. and Latin America, less than half (47 percent) of those surveyed said they were optimistic. One-third indicated that they’d like the U.S. administration to make free trade and economic integration the top policy priority for the region.
“The United States is the single largest source of investment in Latin America and the Caribbean, but today, our members are concerned with the direction of U.S. trade policy,” said Jose Antonio Muñoz, who was named this week as the new chairman of AACCLA. “As we celebrate AACCLA’s jubilee year, our hope is to capture the optimism indicated by the survey and work with the U.S. administration to promote free trade, free markets, and free enterprise between the United States and the countries of the region.”
Muñoz succeeds Thomas Kenna, who led AACCLA as chairman beginning in 2015.
The results of the survey were released during AACCLA’s annual “Forecast on Latin America and The Caribbean” conference, which this year served as a commemoration of the 50th anniversary of the founding of AACCLA.
The 2017 AACCLA Business Pulse Survey is available online here.
For half a century, the American Chambers of Commerce (AmChams) have been the most influential voice of U.S. business in Latin America and the Caribbean. Today, joined together in the Association of American Chambers of Commerce in Latin America and the Caribbean, these 24 AmChams represent more than 20,000 companies and over 80 percent of U.S. investment in the region.
The U.S. Chamber of Commerce is the world’s largest business federation representing the interests of more than 3 million businesses of all sizes, sectors, and regions, as well as state and local chambers and industry associations. Its International Affairs division includes more than 70 regional and policy experts and 25 country- and region-specific business councils and initiatives. The U.S. Chamber also works closely with 117 American Chambers of Commerce abroad.