Central and Latin America: Country Risk Ratings

Bermuda (BMU)

Bermuda’s overall risk level remains low. David Burt, leader of the Progressive Labour Party remains the premier of the country. Political violence and political interference remain low, with legal & regulatory risk at a medium low. The Bermuda government has launched a consultation program, the Red Tape Reduction Consultation, where the people of Bermuda will be able to publicly share their thoughts on government policies and regulations and make suggestions. The minister for the Cabinet Office, Vance Campbell has committed that the Personal Information Protection Act (PIPA) legislation will be active from January 1 2025. MP’s in Bermuda are now discussing the introduction of the Cybersecurity act, after the cyberattack last September. This act will include the setup of National Cybersecurity unit and a National Cybersecurity Incident Response Team. A shooting occurred in the Middle Town neighbourhood, that injured 4 people on the 2 of May. The Premier addressed the incident and noted that such violence creates fear and assured the community the government is committed to make the island safer. Supply chain disruption remains medium and exchange transfer remains low. Bermuda’s economy is expected to grow between 4.3% and 4.5% in 2024, according to the ministry of Finance. The government will continue its targeted investment in the local economy, while also trying to achieve greater economic diversification. Sovereign non-payment remains medium and exchange transfer remains low. The Bermuda dollar is pegged to the US dollar at a rate of 1 to 1. The risk of doing business has increased from medium low to medium, with taxes continuing to be non-existent. Banking sector vulnerability remains medium high.

Dominican Republic (DOM)

Dominican Republic’s overall risk level remains medium. Luis Abidaner will remain president of the Dominican Republic after winning the elections in May with 58.85% of the votes, with former President Leonel Fernandez receiving just 27.29% of the total votes. A run-off election will not be required, since Abidaner gained more than 50%. A major factor for Abidaner’s re-election was how he handled the COVID-19 crisis. Political violence and political interference remain medium, with legal & regulatory risk at a medium high. Abidaner is very focused to tackle corruption in the Dominican Republic, which remains a great issue in the region. The Dominican Republic is closely affected by the ongoing gang war in Haiti and many fear that immigrants from the neighbouring region will raise security risks. Abidaner has noted the country’s slogan will be to either fight together to save Haiti or to fight alone to protect the Dominican Republic. Supply chain disruption remains medium. Growth is expected to rise by 3% to 5.4% in 2024 and rebound to 5% in 2025, according to the IMF. The tourism sector has proved to be a key factor for the country’s continuous growth and it generates 15-16% of its GDP. CPI is forecast to drop to 4.2% in 2024 and to 4% by 2025. Dominican Republic’s current account deficit is projected to decline to -3.7% of GDP in 2024 with a government debt/GDP ratio of 59.5%.   Sovereign non-payment remains medium and exchange transfer remains medium low. The Dominican Peso has slightly depreciated against the US dollar by around 2%, over the past 6 months. The risk of doing business remains medium. Banking sector vulnerability remains medium low and the inability of government to provide fiscal stimulus remains medium.

French Guyana (GUY)

French Guyana’s overall risk level remains low. Gabriel Serville, leader of the Guianese Socialist Party remains president of the National Assembly of French Guyana, since 2021. French Guyana is considered a French territory, therefore the head of State is the president of France. Political violence, political interference and legal & regulatory risk remain low. President of France, Emmanuel Macro visited the region in March to discuss issues, such as poverty and crime, but also address the issue of illegal mining. Macron is planning to create new regulated gold mining zones, in an effort to reduce illegal mining and its effects on the environment. Mercury is a toxic substance very commonly used by illegal miners to extract gold, which then leaks into rivers and forests and therefore to humans. The use of the substance will be prohibited in the new gold mining zones. Estimates show that around 5 tons of gold where extracted from the region according to Macron. French Guyana continues to suffer from issues, such as poverty, high unemployment, poor education and infrastructure. Poverty is reported to be 53% of the population in French Guyana. Supply chain disruption remains low. Sovereign non-payment and exchange transfer remain low. The currency utilised in French Guyana is the euro, since being a French territory. The risk of doing business remains low and banking sector vulnerability remains medium low.

Guatemala (GTM)

Guatemala’s overall risk level remains medium high. Bernardo Arevalo, leader of the Movimiento Semilla party, is now president of the country after receiving 60% of the votes in the 2023 elections. Political violence and political interference remain medium high, with legal & regulatory risk at a high. Arevalo’s campaign was focused on increasing transparency and reducing corruption. Arevalo has now dismissed his minister of environment and natural resources, after his 28-year old daughter’s did not meet certain protocols, showing zero tolerance to any misuse of state resources and corruption. 7 soldiers have been sentenced to jail for their role in the killing of six protesters. In March Kamala Harris had hosted the Guatemalan president in the White House to discuss methods to reduce migration from Central America to the US. U.S. Secretary Antony Blinken travelled to Guatemala in May to discuss with Arevalo about the same immigration issues. However, Guatemala is now also seeking diplomatic ties to China, however without losing ties to Taiwan. Supply chain disruption remains medium high. Growth is expected to remain at the same rate as 2023 at 3.5% in 2024, but rise to 3.7% in 2025, according to the IMF. CPI is forecast to drop by 2.2% in 2024 to 4% and stay at 4% in 2025. Guatemala’s current account surplus is projected to decline to 2.4% of GDP in 2024 and further decline to 1.9% in 2025. Sovereign non-payment remains medium and exchange transfer has decreased from medium low  to low. Guatemala’s currency the Quetzal is pegged to the US dollar at a rate of 1 Quetzal per 0.128909 USD. The risk of doing business remains medium high, due to high levels of corruption, lack of education and training, poor infrastructure and lack of access to financial services. Banking sector vulnerability and the inability of government to provide fiscal stimulus remain medium low.

Haiti (HTI)

Haiti’s overall risk level remains high. Prime minister Ariel Henry has announced that he will step down after the creation of the council and the appointment of an interim leader, who came in control after the assassination of the president in 2021. Political violence remains high, with political interference and legal & regulatory risk very high. The names of the members of the council have been announced by the government and the council will set a president and a prime minister. Haiti has been suffering from gang wars, which have led to the death of over 1,500 people this year and the hunger of millions. Gangs reportedly now control around 80% of Port-Au-Prince and continue to expand their territory, with the government not being able to limit their power and seeking help from abroad.  Civilian contractors have been trying to create a living area for a Kenyan task force of 1,000 soldiers, which has been delayed multiple times since it was agreed in July 2023. Other countries that have offered to support Haiti are Benin, Jamaica and the Bahamas. Gangs also demand a seat in the council that will determine the presidency and are threatening for more violence if their demands are not met. The council had internally chosen the new prime minister, but have decided to delay the process. Supply chain disruption remains high. Growth is expected to continue to decrease to -3% in 2024, due to the ongoing crisis, but rebound to 1.5% in 2025 according to the IMF. CPI is forecast to decrease from 44.1% to 23% in 2024 and reach 14.3% in 2025. Haiti’s current account deficit is projected to decline to -0.8% of GDP in 2024 and rebound to -1.2% in 2025. Sovereign non-payment remains medium high and exchange transfer remains medium low. Haiti’s currency the Gourde has slightly appreciated in value against the US dollar over the past 6 months. The risk of doing business remains very high, due to the ongoing crisis in Haiti. 

Puerto Rico (PRI)

Puerto Rico’s overall risk level remains medium low. Pedro Pierluisi of the New Progressive Party remains governor of Puerto Rico, since 2020, who will be running for re-election in the November elections. Political violence and legal & regulatory risk remain medium low, with political interference at a high. Puerto Rico, despite being in US territory, cannot cast ballots for the U.S.  elections, but can participate in presidential primaries by sending delegates to both the Democratic and Republican national conventions. Joe Biden won the democratic presidential primary in Puerto Rico on Sunday April 29. Meanwhile, there have been at least 3.5 million reported cases of dengue from Puerto Rico to Brazil, an illness that is spread through mosquitoes. Moreover, COVID-19 appears to remain a challenge for Puerto Rico. A big debate occurred in February, due to the announcement of the mandatory use of face masks, by the House of Representatives, following the increased COVID-19 cases. Supply chain disruption remains medium low. Growth is expected to rise to -0.2% in 2024 and reach 0% by 2025, according to the IMF. Pierluisi has announced that Puerto Rico’s budget of $14 billion, which is the highest in the country’s history, which will help to reduce violence, aid the elderly and fund solar power programs. CPI is forecast to drop to 1.9% in 2024, but rebound to 2.3% in 2025. Puerto Rico’s government debt/GDP ratio is projected to rise to 17.2% in 2024 but well below previous levels after the 2022 debt reprofiling.  The currency utilised in Puerto Rico is the US dollar. The risk of doing business remains medium, with challenges such as the cost of doing business and natural disasters. Banking sector vulnerability and the inability of government to provide fiscal stimulus remain medium.

Trinidad and Tobago (TTO)

Trinidad and Tobago’s overall risk level remains medium. Keith Rowley remains prime minister of the country, with Christine Kangaloo as president, after being elected in 2023. Political violence and political interference remain medium, as legal & regulatory risk remains at a medium high. A large oil leak occurred in the seas around Trinidad and Tobago by a barge that was carrying around 35,000 barrels of fuel oil, which capsized in February. The volume of the spilled oil, but also the ownership of the ship remain unknown. The tourism industry might be seriously harmed by this incident, but also the fishing industry.  Meanwhile, the twin-island nation is in talks with Venezuela and BP to develop a shared offshore gas field in the Caribbean, as BP is seeking to expand its production of natural gas. About 18% of BP’s liquefied natural gas is being produced in Trinidad and Tobago. Prime Minister Rowley also recently met with the President of Ghana to discuss various issues, such as the imminent finalization of a gas deal, but also about a Bilateral Air Services Agreement. Supply chain disruption remains medium. Growth is expected to rise to 2.4% in 2024, but be 2.3% in 2025, according to the IMF. The country’s economy highly depends on the production of oil and gas which account for 37% of its GDP. CPI is forecast to drop by 3.1% to 1.5% and rebound in 2025 to 2.2%. Trinidad and Tobago’s current account surplus is projected to decline to 5.7% of GDP in 2024, but then increase to 6.5% in 2025. Sovereign non-payment remains medium and exchange transfer remains medium low. Trinidad and Tobago’s dollar has slightly appreciated against the US dollar over the past 6 months and is operating under a floating exchange rate system.  The risk of doing business remains medium high and banking sector vulnerability remains medium low.