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Caribbean and LatAm businesses upbeat for 2010

Published:Friday | February 19, 2010 | 12:00 AM

Despite the
challenging circumstances facing economies and businesses around the world, corporate leaders in the Caribbean and Latin America who do business with the United States are upbeat about the future, according to the latest Association of American Chambers of Commerce in Latin America (AACCLA) business pulse survey.

The survey done in August and September last year by the AACCLA, the umbrella organi-sation of US chambers of commerce in the region, showed that more than half, or 52 per cent of leaders polled were optimistic about the 2010 economic and political outlook. It sampled 900 business leaders affiliated with US trade chambers in more than 22 countries, representing more than 80 per cent of US investment in Latin America and the Caribbean.

The survey included questions on issues such as democracy, rule of law, economics, trade, politics, among others, with the aim of getting corporate perspectives on their impact on business.

Growth expectations

"Although there are challenges, the majority of respondents are optimistic, expect recovery in 2010 and have articulated growth expectations for the region as a whole, as well as on a national level," Deika Morrison, managing director of MDK Advisory & Consulting Limited, who recently presented the finding on behalf of the American Chamber of Com-merce in Jamaica (AmCham).

"To me, if we work together with priorities, then we do indeed have opportunities for growth, even in this crisis," the former government senator and junior finance minister in the previous People's National Party administration said at the Kingston launch of the survey results.

According to the poll, two-thirds of the respondents expected regional recovery for Latin America and the Caribbean in 2010, with 14.1 per cent anticipating growth greater than two per cent. At the same time, 30.8 per cent forecasted one to two per cent growth and 22.8 per cent predicting growth rates of between zero and one per cent.

For Jamaica, most of the business leaders whose outlook was sought predicted growth rates below three per cent, coming out between minus one to two per cent, AmCham said. But for the next four years, at least 77.8 per cent said that they were optimistic about the economic and political situa-tion in the country. About 11 per cent were said to have reflected pessimism or remained neutral on the matter.

Among Jamaican business-persons captured in the data, free trade and economic integration were considered the most important issues for the Barack Obama administration in the United States, with 41 per cent of respondent so indicating.

Security priority

About 16 per cent, the results show, thought that strengthening security and combating violence and narco-trafficking in Latin America and the Caribbean should be top agenda items for Obama

The survey covered Jamaica as well as Panama, Mexico, Honduras, Haiti, Guatemala, Trinidad and Tobago, the Dominican Republic and Colombia.

According to the survey, the main external threats to business were economic crisis, competition from state-owned and controlled actors and political instability.

About 39 per cent of respondents cited strengthening the rule of law and fighting corruption as the number one short-term reform priority, 22 per cent say reducing regulations, and four per cent pointed to physical security and crime enforcement.

Education was seen as a long-term issue with the need for businesses to also play their part in assisting with funding.

Among the issues listed as obstacles to business profitability were high taxes, weak or inefficient public institutions and the high cost of capital.