Venezuela: counting the cost of crime
January 25, 2012 9:48 pm by Benedict Mander
It is no secret that Venezuela is hardly the most business friendly country in the world, with a president who habitually takes pleasure in grabbing private property, while a maze of government regulations act as an added deterrent.
But a new report shows that Venezuela’s acute insecurity problem – it has one of the highest homicide rates in the world – also makes it the Latin American country where crime affects businesses the most.
Basing its findings on World Bank figures, a new survey by Latin Business Chronicle looked at factors like the losses sustained by companies as a result of robberies and vandalism, as well as the cost of security.
It found that companies were hit far worse in Venezuela than Mexico, which is in the middle of a brutal drug war but came in at eighth position overall. Companies in Venezuela registered the highest losses of any country in the region due to robbery, and also spent the third highest amount on security costs.
Honduras and El Salvador were the next worst after Venezuela, while Uruguay was the country least affected, followed by Colombia and Panama.
The news comes as Venezuela formally notified the World Bank on Tuesday that it will withdraw from its arbitration body, the International Centre for the Settlement of Investment Disputes, where some 20 foreign companies are claiming compensation for as much as $40bn from the OPEC country after their assets were expropriated.
In a country where, depending on whose statistics you believe, someone is killed about every half hour, and anecdotal evidence suggests that demand for armouring vehicles is roughly doubling each year, crime is unlikely to stop being a problem for businesses any time soon.