Latin America's future growth will depend not only on politics or commodity prices, but also on a less visible yet equally decisive factor: the cost of capital.

Infrastructure is the backbone of any economy that aspires to grow sustainably. Roads, ports, dams, and canals require long-term capital. They require a large amount of capital and, above all, capital at a reasonable cost.

Every loan a bank grants—whether to a farmer, a small business, or a family buying a home—starts with a fundamental question: How much does it cost the bank to raise funds? That cost influences the loan’s interest rate, the bank’s willingness to grant it, and the amount of financing that flows into the real economy.

Latin America’s tech ecosystem is advancing at a rapid pace. Startups are targeting large markets, adapting quickly, and introducing new business models into everyday life. However, the main obstacle isn’t always product design or a lack of talent. In my work evaluating valuations, risks, and capital structures for startups and scale-ups in the region, I constantly encounter the same structural barrier: a high weighted average cost of capital (WACC).

Central American leaders constantly talk about integration: trade and customs reform, as well as logistics and infrastructure. But the region’s next concrete step forward could come from something more subtle: reducing the cost of capital by harmonizing the rules and procedures that determine the costs of public borrowing and the way markets assess regional risk.