Analysis
In the Media

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.

While Western institutional investors and Chinese state-backed lenders compete for influence over Latin America’s energy infrastructure, one factor is quietly determining who will build the region’s clean energy future: the cost of capital.

In previous installments of this series, we examined how inflation acts as a hidden tax that makes money more expensive, and we broke down the components of equity, debt, and the weighted average cost of capital (WACC).