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Corruption costs Central America $13 billion

The money taken away by corruption in Central America is “around 5% of GDP,” said Martínez. He is participating in Honduras in the IX Central American Donor Forum. The executive director of the Seattle International Foundation, Arturo Aguilar, inaugurated the Forum. Corruption is a “systemic phenomenon and, therefore, will require systemic interventions,” said the INCAE Business School expert.

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Corruption is an obstacle to development in Central America. The region loses $13 billion every year due to this scourge. That represents around 5% of the Gross Domestic Product (GDP), an INCAE Business School official said Thursday.

Central America suffers from corruption

Octavio Martínez, director of the Latin American Center for Competitiveness and Sustainable Development at INCAE Business School, said in an interview with Efe, in Tegucigalpa, that every year Central Americans lose “13 billion dollars” because of corruption.

The amount of public money taken away by corruption in Central America represents “around 5% of GDP,” said Martínez. He is participating in Honduras in the IX Central American Donor Forum. The executive director of the Seattle International Foundation, Arturo Aguilar, inaugurated the Forum.

He assured that this scourge is “one of the main obstacles for the development” of Central American countries. So he believes that governments should see the issue “as a priority.”

Corruption is a “systemic phenomenon and, therefore, will require systemic interventions,” said the INCAE Business School expert.

This picture show a beautiful lake in Guatemala.
El Salvador, Guatemala, Honduras and Nicaragua, known as the CA-4 group, have “very high levels of corruption similar to those in sub-Saharan Africa” (Source)

Governments should fight against corruption

Against this backdrop, he stressed the importance of the private sector being able to “really contribute” to the fight against corruption.

And also the importance of the government promoting improvements from the regulatory framework to the “more efficient and transparent” functioning of the different processes.

He regretted that this scourge in Central America is an “endemic” problem. Since the region, especially El Salvador, Guatemala, Honduras and Nicaragua, known as the CA-4 group, have “very high levels of corruption similar to those in sub-Saharan Africa”.

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Martínez said the fight against corruption must be “a number one priority” of governments.

Political instability also affects the development

The countries of Central America are “lagging behind.”The pace of growth “threatens us to continue widening the gap between developing countries and developed countries. The last ones are growing at faster rates economically and socially,” he said.

The director of Latin American Center noted that in the last 50 years the per capita GDP of Central Americans “has declined” in relation to the per capita GDP of the United States. He said that US economy “is a mature economy that should grow at rates lower than ours.

Martinez also assured that corruption and political instability are “hindering our capacity for development.” And that a “multisectorial joint work” is required to define a long-term agenda between the public and private sectors and academia.

This picture show a suitcase full of dollars.
Corruption costs Central America $13 billion, 5% of GDP. (Source)

The Central American Donor Forum

The region must work to strengthen democratic institutions. Also to improve the business climate so that economic activity can “flourish” and define an agenda of social progress. Moreover it needs an environmental sustainability that “identifies and addresses the priority issues of citizens,” he added.

Martínez said that we can prevent corruption. He also said that the Central American Donor Forum will discuss measures to “prevent, detect and punish” corruption.

The effort must be “joint” and each sector must “assume its role” so that the work is sustainable over time, said the director of the Latin American Center for Competitiveness and Sustainable Development of INCAE Business School.

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The IX Central American Donor Forum is sponsored by the Seattle International Foundation. More than 400 experts discuss corruption and the fight against impunity. Other subjects debated are the economic development, feminist movements and opportunities for alliances between the public and private sectors, among other topics.

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(Featured image by eismannhans via Pixabay)

First published in yahoonoticias, a third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.

Although we made reasonable efforts to provide accurate translations, some parts may be incorrect. Born2Invest assumes no responsibility for errors, omissions or ambiguities in the translations provided on this website. Any person or entity relying on translated content does so at their own risk. Born2Invest is not responsible for losses caused by such reliance on the accuracy or reliability of translated information. If you wish to report an error or inaccuracy in the translation, we encourage you to contact us.

Michael Jermaine Cards is a business executive and a financial journalist, with a focus on IT, innovation and transportation, as well as crypto and AI. He writes about robotics, automation, deep learning, multimodal transit, among others. He updates his readers on the latest market developments, tech and CBD stocks, and even the commodities industry. He does management consulting parallel to his writing, and has been based in Singapore for the past 15 years.

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