On September 29, the Adrienne Arsht Latin America Center hosted an event to discuss Central America’s economic reactivation in the context of COVID-19 and how countries can take advantage of the demographic bonus of a large working-age population, attract nearshoring opportunities, and renew momentum towards regional integration. The event marked the launch of a new Adrienne Arsht Latin America report titled, “Central America Economic Reactivation: Finding Sustainable Opportunities in a COVID-19 World” by former President Laura Chinchilla, former Minister María Eugenia Brizuela de Ávila, María Fernanda Bozmoski, and Domingo Sadurní, with Salvador Paiz and Enrique Bolaños as contributing authors.
Laura Chinchilla, former president of the Republic of Costa Rica and member of Adrienne Arsht Latin America Center’s Advisory Council, provided keynote remarks that emphasized the chronic problems facing Central America including high poverty rates, violence, migration to the United States, and a disenchantment with democracy. Former President Chinchilla stated that economic reactivation must be designed with a medium-to-long-term perspective to effectively tackle structural challenges, build on existing strengths, and place young people at the center of Central America’s future. Her keynote served as a call to action for turning this crisis into an “opportunity for past and present generations of Central Americans.”
Following the keynote remarks, María Fernanda Bozmoski, associate director of the Adrienne Arsht Latin America Center, moderated the panel discussion on unlocking economic growth in Central America, the role of public-private partnerships, and prospects of regional integration. Former Minister María Eugenia Brizuela de Ávila, non-resident senior fellow at the Adrienne Arsht Latin America Center, highlighted Central America’s unique economic ties, due to trade agreements with the United States and the European Union, and how this poses an opportunity “for allies to promote cooperation, democratic values, and rule of law” in collaboration with the private sector. Likewise, Andrew Herscowitz, chief development officer at the US International Development Finance Corporation (DFC), spoke to the need for investing in small and medium enterprises in Central America, and mentioned the DFC’s commitment to investing $1 billion in Guatemala and Honduras, as well as the need to strengthen financial sectors through job creation in innovative areas, such as financial technology.
Salvador Paiz, president of Fundación Sergio Andrade Paiz (FUNSEPA), mentioned that regional integration in Central America has been mostly occurring through the private sector – with some exceptions such as the Guatemala-El Salvador-Honduras customs union – due to lack of coordinated political will and investment from governments in the region. Mr. Paiz believes that there is a need to deliver momentum behind integration which requires agreeing and communicating the benefits of seizing low-hanging fruits, like digitalizing customs offices and integrating them into a common systems platforms (such as the US-Mexico FAST program), committing to concrete deliverables, and guaranteeing government accountability. Bringing Nicaragua to focus, Enrique Bolaños, rector of INCAE Business School, described the country’s short-to-medium-term outlook in light of the pandemic, economic mismanagement, migration, and erosion of democracy that Nicaragua faces today. Mr. Bolaños explained that after two years of political crisis, the outlook is grim, especially since economic forecasts place Nicaragua as the only country in the world that will have a negative GDP in 2021. For him, “economic improvement and the well-being of Nicaraguans depend on the resolution of this political crisis.