Without Legal Certainty There is No Investment

If Central America does not strengthen the institutions that ensure a stable legal framework and full respect for contracts, foreign investment will not come and national investment will go to other countries, no matter how many incentives and tax exemptions are offered.

Tuesday, June 16, 2015


The frequent displays of discontent for the Salvadoran Executive Branch in respect to rulings issued by the Constitutional Court and the inaction of the Panamanian government over blockades by a group of people are holding not only over the hydroelectric project Barro Blanco, but also the main access roads, are appalling signals sent from the region to the world, casting doubt on those companies who consider the region to be a potential investment destination.

Legal certainty not only attracts foreign investment which creates jobs and economic growth in the countries of the region, it is the cornerstone of any nation that claims to be respectful of the Constitution and the rights of their citizens and businesses.

The Central American private sector should not desist in its efforts to ensure respect for the rights and principles of legality and legal certainty for investment which comes from both foreign and local capital.

As stated by Carlos G. Fernandez, president of the Chamber of Commerce, Industries and Agriculture of Panama (CCIAP), "... Money is nervous. We are sending the wrong signals to investors and financial institutions, regardless (referring the Barro Blanco project) whether there is an ambitious investment plan, which requires the collaboration of the private sector.'"

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