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Nine out of 10 Latin Americans distrust their neighbor

2022-01-13T13:46:34.477Z

A new study by the Inter-American Development Bank warns that low confidence in the region hinders economic growth and innovation



People with masks walk on a street in São Paulo (Brazil), during June 2020.Sebastião Moreira (EFE)

Compared to the world's largest and most developed economies, those in Latin America have much less confidence, according to the most recent analysis published by the Inter-American Development Bank (IDB).

90% of Latin Americans distrust others, a quarter of the levels registered in countries that make up the Organization for Economic Cooperation and Development (OECD).

"Distrust in the region is high, it is increasing and penetrates all corners of society," says the report, edited by Philip Keefer and Carlos Scartascini. "It undermines productive relations between and within companies, erodes civility and limits the ability of citizens to take collective action in support of laws and institutions that promote sustainable development," say the specialists.

"The new findings reveal that mistrust distorts the policies that citizens demand of their governments, prioritizing cash transfers over public services such as security and education, which would improve their well-being," the IDB reported. The impact on democracy and governance is clear, according to the document. “In countries where trust levels are low, citizens are more reluctant to vote for better policies. They are also less likely to complain when the Government fails to fulfill promises or support actions that discourage the search for unproductive income by the private sector ”.

The report entitled "

Confidence: the key to social cohesion and growth in Latin America and the Caribbean

", documents how countries with greater confidence tend to enjoy higher levels of productivity, while those with low levels of confidence tend to informality. An example is in the public sector. Of the 2,500 public officials in the region interviewed by the researchers, those who expressed greater confidence reported sharing more information and collaborating more with their colleagues, streamlining the public sector. In contrast, lowered trust ratings were associated with fewer digital government services, poorer regulatory quality, and higher tax evasion.

A survey was also made of 3,000 companies in the private sector through a digital platform.

The results showed that those managers whose companies had greater competition reported having more interpersonal trust than those companies that recognized having less competition.

"Strengthening confidence is essential for the business sector to become more dynamic and carry out the economic reforms necessary to enhance the post-covid recovery in Latin America and the Caribbean," the IDB said.

"Transparency of elections, political party institutions, citizen participation and corruption, among other factors of democratic governance, are essential to increase trust," the organization said.

The IDB recommends that governments increase the level of transparency of the budget, spending and regulations, as well as better information campaigns that communicate the fulfillment of promises and results. “Education is the foundation of trust. The report highlights that individuals with a higher level of education are better able to discern whether they were victims of bad luck or opportunistic outside behavior, even by companies or the Government, ”says the publication.

"Promoting trust through greater transparency and stronger institutions should be high on the political agenda in Latin America and the Caribbean," said IDB President Mauricio Claver-Carone.

“Greater trust means less bureaucracy that hurts business, investment and innovation.

It means more transparent governments, committed to keeping their promises and being accountable.

And finally, it also involves committed citizens who give voice to their opinions and actively participate to enhance democracies and support the construction of more inclusive societies, "he added.

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Source: elparis

All business articles on 2022-01-13

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