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Latin America Investment News on Viva Tropical

El Salvador: 1 in 10 Adults Experienced an Armed Robbery in Last 12 Months

Article Summary:

With 10.6% of adults in El Salvador have said to have suffered an armed robbery in the last 12 months, its understood that Salvadorian companies see a loss of sales due to violence. According to The World Bank crime rates and violence in El Salvador are among the highest in Latin America, to the point that the Salvadoran entrepreneurs interviewed for Bank surveys stated that crime is the number one constraint for productivity and growth, even greater than competitors informal practices, limited access to financing, corruption and macroeconomic instability.

photo Credit: El Mundo

Original Article Text From El Mundo via Google Translate :

Companies lose 4.5% of Sales by Insecurity

The World Bank, the cost of violence and crime that generates losses equivalent to 4.5% of sales of Salvadoran firms.

Costs and losses faced by firms in the country due to violence is equivalent to 4.5% of sales, according to a study conducted late last year by the World Bank (WB).

In “Crime and violence in Central America. A Challenge for Development “, the agency cites 2006 data from its surveys that companies around the world, the Enterprise Surveys.

The data reveal that the losses reported by firms for the crime equivalent to about 2.8% of sales. The cost of private security amounts to 1.7% of sales, totaling 4.5%, the highest rate in Central America.

“The high cost of violence (…) acts as a barrier to competition, reduced profit margins and can mean the difference between success or failure of a company,” says the World Bank in its study.

And, according to the report, rates of crime and violence in El Salvador are among the highest in Latin America, to the point that the Salvadoran entrepreneurs interviewed for the surveys of the Bank stated that the crime is the number one constraint for productivity and growth of the country over competitors informal practices, access to financing, corruption and macroeconomic instability.

The costs generated by crime are so high that the World Bank also estimates that if El Salvador reduced by 10% the rate of homicides increased to achieve a 1% annual per capita income.

The country has the highest homicide rate in Latin America with 58 murders per 100,000 inhabitants, a rate higher than the average American, which is 35.4 per 100,000 inhabitants.

The causes, according to the WB

1. Drug Trafficking
Drug trafficking is a major promoter of homicides in the region and the main factor in the levels of violence, he says.

2. Justice weak
Weak legal institutions limit the effectiveness of the punishment and prevention of crime and violence suffered by all the countries of Central America.

3. Arms
Civil wars and the increase in arms imports in the years after those conflicts have left the region submerged in weapons, says the World Bank.

4. Gangs
Although not deny their influence, for more than 900 gangs operate in the region, “there are indications that are responsible for a small part.”

19% and 19% of adults said Salvadorans have been a victim of crime in the last 12 months.

10.6% The 10.6% of adults in El Salvador said to have suffered an armed robbery in the last 12 months.

Link to Original Article:

From El Mundo

Latin America Investment News on Viva Tropical