Today we welcome Simon Dexter from GWCI to discuss due diligence and exports, with a focus on our region.

Latin America is a hotspot for investment and opportunities to trade. Companies wishing to export to Latin America must do so with caution, as they may come across a multitude of issues.

Bribery & Corruption

In a 2019 survey published in Statista, 31% of respondents said that corruption was the most important problem their countries faced.

The second most important problem was unemployment and the lack of economic growth and the third, political instability and institutional weakness. 

Transparency International’s Corruption Perceptions Index (CPI) ranks 180 countries and territories by their perceived levels of corruption. Scores go up to 100, with higher scores denoting less corruption.

In 2020, the regional median score stood at a very low score of 39, suggesting very high levels of corruption. 

Tax evasion

Tax evasion is a serious problem in Latin America, affecting growth in areas such as public transportation, quality health services, and infrastructure. In 2015, Latin America’s tax evasion cases collectively amounted to a colossal US$340 billion.

One of the many reasons for this is because of the high frequency of informal work and low personal income tax. Large percentages of the population do not pay tax, with many not having the means to do so.

Tax havens

Latin America has many tax havens and is problematic for companies wishing to export to Latin America.

The Organisation for Economic Co-operation Development (OECD) define tax havens as countries/territories with the following characteristics: lack of transparency, minimal or no taxation, and the existence of laws that prevent the exchange of information between governments.

Tax havens are problematic to business as they enable criminal networks to operate under the cover of being a legitimate enterprise.

States with the “Tax Haven” status are often misinformed in thinking that their status will bring rapid development and improve the standard of living. In reality, the opposite happens; companies are often deterred from setting up businesses in these states.


The US has sanctioned two Latin American countries: Venezuela and Cuba. For over 15 years, the US has imposed sanctions on Venezuela in response to the activities carried out by Venezuela’s government and individuals.

Supply Chain Management

Supply chain corruption is a global issue, affecting companies around the world. The United Nations found that annual global cost of corruption stands at 5% of global GDP.

It is important that companies exporting to Latin America are aware 0f the impact of the globalisation of supply chains within the region as it means that companies operating across borders can be exposed to potential corruption and bribery throughout their supply chains. In Latin American countries, bribery and corruption policies are often not rigorous enough, and corrupt practices are usually commonplace.

In some Latin American countries, corruption and bribery extends to the highest levels of government.

In Brazil in  March 2014, Operation Carwash began; an investigation into allegations that Brazil’s state oil company Petrobras accepted bribes from construction firms during the awarding of contracts. Many government officials were indicted as a result, prominent figures including former presidents were entangled in the corruption scandal. Operation Carwash found that Latin America’s largest construction conglomerate Odebrecht was involved in these corrupt practices.

Key issues of concern for companies wishing to export to Latin America, is the fact that efforts to address supply chain corruption have plateaued, despite an initial period of success.

Want to find out more? Contact Simon Dexter-Jones, Head of Global Sales or visit