2nd June 2023

President Andrés Manuel López Obrador (AMLO) has announced a proposal to allow temporary work visas for Central Americans in Mexico. The visas will enable regional workers to be employed on such projects as the Maya Train. Trades such as welders, blacksmiths and other manual work as well as engineers will be required. In order to link up the south of Mexico, which includes the Maya train, Interoceanic rail corridor and ports on the Atlantic and Pacific oceans, AMLO said Mexico will require more workers. According to the International Labor Organization (ILO) in a report published in Mexico City, there have been some programs in the region but migration is outstripping them. In the past 15 years international migrants have grown in Latin America and the Caribbean from 7 to 15 million, 5.3% of the world’s total.

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PHOTO: Mexican President Andres Manuel Lopez Obrador speaks during a news conference at the Secretariat of Security and Civilian Protection in Mexico City, Mexico REUTERS/Henry Romero

19th May 2023

The Council of Central American Transport Ministers (Comitran) discussed the integration of transport networks during a meeting in El Salvador. Having received the master plan for mobility and logistics 2035, officials started the task of investing up to US$52.49bn. The plan, presented by the Japan International Cooperation Agency (JICA) and the Central American Economic Integration System (Sieca) calls for an integrated land, sea, air and rail mobility system. El Salvador’s Minister of Public Works and Transportation (MOPT), Romero Rodríguez, argued this would boost regional trade and local economies. If such a system was built it would represent an estimated 35% saving for freight transport.

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Photo: Prensa Latina

5th May 2023

Talks between India and Central American representatives in Panama agreed to continue development of solutions to food security, connectivity and renewable energy. Indian Foreign Minister Subrahmanyam Jaishankar met with counterparts from the Central American Integration System (SICA). An Action Plan will be drawn up to include other areas such as agriculture, IT and health. Trade between India and Latin America reached US$50bn in 2022. India announced plans to gain more of a presence in the region with a logistics centre, possibly in Panama. Jaishankar is on an official tour of the region.

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Photo via: @DrSJaishankar

21st April 2023

Banco Cuscatlán, Banco Industrial and Ficohsa signed an agreement with the HUGE (Honduras, USA, Guatemala, El Salvador) Business and Investment Council to promote the generation of two million new jobs. Employment opportunities are viewed as key to halting migration from the Northern Triangle of Central America to the US. The deal was signed during the “Investment Opportunities to Capitalise on Nearshoring of American companies with companies from Guatemala, Honduras and El Salvador” event. The banks will promote good practices for strategic infrastructure to enhance business opportunities with the US. They will also commit to financial education and awareness programs, as well as reducing their environmental footprint and the promotion of green finance options.

Photo via think-huge.org

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7th April 2023

Taiwanese president Tsai Ing-wen concluded a three-day official visit to Guatemala stating the days of dollar diplomacy are over. In March, Honduras became the latest country to switch allegiances to China, leaving 13 countries officially recognising Taiwan. Guatemala will receive US$150mn in aid from Taiwan during the 2013-2025 period. Taiwan remains the largest shareholder in the Central Bank for Economic Integration (CABEI) and any change to this would imperil dozens of projects across the region. Taiwan represents 11.3% of CABEI’s shares with US$776.25mn out of US$7bn. Since 1997 there have been 20 bond issuances in Taiwan totaling US$2.6bn.

Photo by Jack Brind 

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24 March 2023

Honduras have announced that they will recognise only one China, breaking diplomatic ties with Taiwan that have existed for 82 years. In return, finance and expert assistance will be provided in the construction and operation of dams in Honduras. Diplomatic relations will begin between the two countries before the end of 2023. According to the Honduran government they see China as an “important ally” going forward. China’s Foreign affairs ministry described the move as bringing “more opportunities” to Honduras. Taiwan has warned Honduras, similar to El Salvador, Nicaragua, Panama and Paraguay, that any promises they received from China may not turn out as originally planned. Taiwan is now recognised by 13 countries worldwide. Honduras becomes the ninth country and fifth in Latin America to cut ties with Taiwan since 2016. Honduran foreign minister Enrique Reina stated that China offered more economic aid after not receiving a reply in respect to a renegotiation of a US$600mn debt with Taiwan.

Photo by Ling Tang

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10th March 2023

Nicaragua has formally joined the EL Salvador-Panama Integrated Stock Market and will now have access to a US$54bn market. The overall plan is for a regional stock market but will require legislative fine tuning in Costa Rica, Guatemala and Honduras. A CABEI-backed regional debt market is hoping to begin operations this year. The integrated stock market idea began in 2015 and from 2017 to date has carried out over US$500mn in transactions so far. The General Manager of the Nicaraguan Stock Exchange, Gerardo Argüello, hoped the move would see a 60-fold growth in their local market.

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24th February 2023

Burkhan World Investment has announced an alliance with Costa Rican real estate company Stone Alliance worth up to US$1bn. A range of projects will be considered with Burkhan World Investment beginning with sustainable investments in Marina Tambor and Cobano Preserve on the Southern Nicoya Peninsula. The portfolio consists of mixed eco-development including a marina, hotel, commercial and residential areas. Burkhan World Investment consists of investors from the United Arab Emirates, Bahrain, Saudi Arabia, Oman, Qatar, and Kuwait. The initial investment is in a 360-hectare property with 4.5kms of coastline.

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10th February 2023

Panama President Laurentino Cortizo has authorised the establishment of two new tax free economic zones. The Tech Valley Free Zone and Panama Digital Gateway will be able to house up to 740 companies. Hyundai has already been confirmed as one of the new arrivals. The total investment is believed to be around US$111.5mn, creating at least 4,710 direct jobs. The Panama Digital Gateway will be strategically placed near the new Curie submarine cables and is designed for content providers such as Netflix, Amazon, Facebook and Cloudflare.

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27 January 2023

The World Bank has warned that the Northern Triangle of El Salvador, Guatemala and Honduras face economic difficulties. According to analysts, El Salvador and Honduras faced 2022 with negative growth rates of 8-9%, with Guatemala’s around 2%. Should a worldwide recession become a reality, investment would be more complicated and the cost of debt increase. Any problem with the US’s economy would be felt in Central America through lower demand for exports and a possible fall in remittances. However, remittances have remained record breaking during the pandemic and any export decrease could be offset by nearshoring. Guatemala’s macroeconomic stability is offset by limited public investment and El Salvador’s ability to cover a US$800mn loan payment suggests cause for regional optimism.

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13th January 2023

According to official sources from each country, the total amount of violent deaths in 2022 fell 7.15% from 10,487 in 2021 to 9,737. El Salvador, which has embarked on a social crackdown that has seen over 2% of its adult population jailed, saw its homicide rate of 7.8 per 100,000 inhabitants. The lowest rate in a decade. 496 murders were officially recorded in El Salvador, Security Minister Gustavo Villatoro claimed 65% of those were committed in the first three months of 2022. Panama also saw a decrease while Costa Rica and Guatemala endured increases. Between Guatemala (4,274 deaths) and Honduras (3,397 deaths) they accounted for 81.86% of the region’s homicides. Costa Rica’s 656 homicides was the highest since records began.

Photo by David von Diemar

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9th December 2022

A regional study by the Japan International Cooperation Agency (JICA) suggested that El Salvador spend up to US$8.5bn in mobility by 2035. Of this, US$3bn would go towards the country’s road system. This would include the expansion of the Pan-American highway and Coastal highway. The rest would be spent on ports, airports and other infrastructure. “Other” could include the proposed ferry system with Costa Rica that has failed to be passed by previous governments. The first draft of the final report has been delivered to the respective Central American administrations. The study cost US$4.5mn and was paid for by the Japanese government. JICA hoped its master plan would be passed by each country in 2023.

Photo by Erik van Dijk

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25th November 2022

El Salvador, Nicaragua and Panama have agreed to an integration of their security markets. The Superintendency of the Financial System of El Salvador (SSF), Superintendency of Banks of Nicaragua (Siboif) and the Superintendency of the Panama Stock Market (SMV) agreed to let investors acquire and negotiate securities registered in any of the three countries. It also allows stock market institutions to work in the area covered by the agreement. Regional sources suggest this could see an increase in trading on the Nicaraguan stock market up to 60 times its current level. 98.25% of transactions in Nicaragua are public titles and bonds.

Photo by Maxim Hopman

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11th November 2022

El Salvador and China discuss Free Trade Agreement; confusion over debt

Discussions have already started on a free trade agreement between El Salvador and China. President Nayib Bukele stated that the FTA would help end international isolation and the agreement would be fast tracked to be signed as soon as possible. Meanwhile, Taiwan’s FTA with El Salvador, which had been kept afloat by legal means, has ended. Vice President Félix Ulloa announced that China had offered to buy all of El Salvador’s external debt but the Chinese foreign ministry claimed they were unaware of this offer. El Salvador’s external debt amounts to US$1.6bn.

Photo by Ian Taylor 

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28th October 2022

Central American judges have issued a plea for independence to carry out their functions. Supreme court elections are currently ongoing in Costa Rica and Panama against a backdrop of interference in El Salvador and Guatemala. Of the 25 members of Guatemala’s judicial service that have fled the country in the past 18 months, the majority are either judges or prosecutors. El Salvador has seen alleged illegal appointment of Supreme Court magistrates and the enforced retirement of those over 60. The Seattle International Foundation has warned of increasing authoritarianism in Central America at a forum in Tegucigalpa. Director Adriana Beltrán warned about the criminalization of human rights, the restriction of press freedom and of expression in the region.

Photo by Michael Dziedzic

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14th October 2022

Hurricane Julia’s path through Central America caused an expected level of havoc, leaving dozens dead, millions affected, and repair bills estimated in the billions of dollars. The Honduran government alone reported needing at least US$ 2bn for its recovery efforts. With hundreds of roads and bridges affected, infrastructure repairs will be of a high priority. Guatemala’s agricultural ministry reported that 250,000 families have lost basic food crops with bananas, cardamom and coffee also severely affected. Nicaragua, where Julia made landfall at its strongest, reported US$ 160-200mn in damages and no deaths. Many of the areas affected also suffered damage during Hurricane Eta and Iota in 2020.  

Photo by NASA 

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30th September 2022

Prior to the effects of Hurricane Ian, Honduras had already implemented a state of emergency as heavy rains battered Central America. Guatemala was considering issuing a similar decree with El Salvador also suffering loss of life and structural issues. Sinkholes have appeared across Guatemala causing the deaths of at least two people. Collapsing buildings and landslides have killed dozens more. So far the rainy season has killed 45 and affected over four million in Guatemala. Classes were suspended in El Salvador, as Guatemala endured the fourth wettest rainy season in 40 years.

Photo by Ruslan Zh 

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16th September 2022

Panama’s judicial system is under the spotlight with the opening of the Odebrecht case.
Considered the largest corruption scheme in the country’s history, the preliminary hearing
has opened and will spend days being read out. A total of 48 people are accused of money
laundering and corruption including former presidents Ricardo Martinelli and Juan Carlos
Varela. Charges against a further 29 defendants have been dismissed. The investigation
began in 2015 and after Odebrecht admitted to bribery charges in the US, Martinelli’s sons
Ricardo Alberto and Luis Enrique are serving jail sentences having been captured in
Guatemala and extradited. In July 2017, Odebrecht signed an agreement with the
Panamanian Prosecutor’s Office to pay a US$220 million fine to the State over 12 years.

Photo by Darren Miller