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Challenges for businesses in Latin America for 2022

Political

Several Latin American countries will be facing electoral processes during the upcoming year. There is a clear tug of war between the rightist and leftist movements all over the continente with extremists on both sides using the population’s frustration over years of corruption of the traditional parties to have people take sides.

There will be elections in Colombia for congress and President, for President in Costa Rica and general elections in Brazil.

Chile, Honduras and Argentina held elections during the past month of November with surprising results in Honduras. Observers are standing by how the situations evolves in these countries, with special attention to Argentina where the party of government suffered a big defeat.

Economic

It’s not a secret that the pandemic caused by COVID 19 brought a lot of pressure on the economies of the región. Inflation rates have been rising sparked by high energy and food costs and the global supply chain crisis. The high inflation and rising unemployment numbers will surely cause social instability so companies must be prepared.   

Legislative Uncertainty

In many of the countries of the región the lack of strength of the parties in government, and failing to have majorities in congress has caused many difficulties to pass laws seeking reform. The people all over Latin America are demanding economic support from their governments but there is little will from rulers top ut a hold on public expenditures and use the funds to help the less favoured classes. In the countries with leftist parties in government, presidents are looking for greater control of the economy.

Corruption

Peru, El Salvador, Costa Rica, Colombia and Mexico continue to have corruption scandals that threaten political stability. People demand swift action from the judicial systems, but these have traditionally failed to prosecute the actors involved in the scandal.

Migrants

Migrants trying to get to the United States from Central American countries cause a big pressure on the regions they go through. Organized crime is a big part of the problem as they use migrants as an exchange instrument. And Venezuelans who have been fleeing their country to Colombia and Ecuador continue to cause problems as the lack opportunities forces them into the criminal world.