Access to Trade in Latin America Can be achieved through Improved Infrastructure
Even though Latin America has recently enjoyed its highest economic growth rates since the late 1970s, economic strength and momentum in other regions—Asia, Europe—overshadows its progress. Latin America is not advancing as rapidly and will continue to fall behind if businesses and governments do not prioritize spending on infrastructure and address regulatory barriers.
In Latin America, poor transportation infrastructure and regulatory barriers undermine the region’s competitive strengths. Across most Latin American countries, less than one-third of the national road network is in good condition. The Organization for Economic Co-operation and Development (OECD) suggests that although proximity to the U.S. is a competitive advantage to Latin America, this edge is quickly eroded by an insufficient network of roads, ports, railways and airports. Insufficient infrastructure drives up transaction and transportation costs, and this impairs Latin American countries’ competitiveness with hot markets like China. To grow and compete aggressively with other markets, it is imperative that Latin America improve its infrastructure to lower transaction and transportation costs.
To compete successfully with rapidly growing economies in the global marketplace, key stakeholders from both the public and private sectors need to foster and develop partnerships to build stronger physical transportation networks. Businesses large and small must collaborate with government and non-profit organizations in new and innovative ways. Of the top 100 economies in the world, 51 are corporations and 49 are countries. Without a doubt, corporations, and governments play comparable roles to shaping the global economy.
While Latin American governments have recently increased investments in infrastructure development, we cannot rely solely on their efforts. In addition, businesses must forge partnerships with governments to establish procedures that facilitate trade and eliminate any unlawful practices. Efficiency in cross-border trade flows would significantly increase. Improved and increased transportation infrastructure across Latin American countries would create better cohesion and economic strength, allowing governments and organizations to work more closely together and give businesses the economic framework to grow and expand their market reach with more speed and frequency.
With so much promise for potential growth and progress, it would be a disappointment if Latin American businesses and governments can’t build the partnerships necessary for our commerce and citizens to thrive in the global marketplace.
Read More