LATIN AMERICA PHYSICAL SECURITY INDUSTRY MARKET STUDY 2023

LATIN AMERICA

PHYSICAL SECURITY INDUSTRY MARKET STUDY

2023

• TECHNOLOGIES STATUS AND ECONOMIC GROWTH • LATIN AMERICA PHYSICAL SECURITY GROWTH • TOP 100 PHYSICAL SECURITY COMPANIES

© Latin Press, Inc., 2023 All rights reserved. No part of this work may be reproduced or incorporated into a computer system or transmitted in any form or by any means (electronic, mechanical, photocopying, recording or otherwise) without the prior written permission of the copyright holders. Infringement of such rights may constitute an intellectual property offense.

Original title: Market study for the physical security industry in Latin America 1st edition: February 2023 Research and writing: Andrea Ochoa Restrepo Editorial Direction: Duván Chaverra Layout: Jhonnatan Martínez Avalo Graphics: Jhonnatan Martínez Avalo Photos: Pixabay

Table of Contents Market study for the physical security industry in Latin America: how is it done?............................5 Introduction................................................................................................................................6 Chapter 1: Technologies trends and economic growth.........................................................................10 Main segments in physical security 2022.......................................................................................... 11 Most used brands by physical security companies 2022.................................................................. 12 Growth according to dependent and independent variables (Growth expectations for 2022, growth in terms of employment, compound annual growth rate for the entire industry)................ 14 Chapter 2: Industry perspectives..............................................................................................16 Mexico............................................................................................................................................... 17 Central America and the Caribbean................................................................................................. 19 Andean region................................................................................................................................... 20 Southern Cone.................................................................................................................................. 23 Consultants Perspectives.................................................................................................................. 24 Chapter 3: Top 100 physical security companies ranking.........................................................30 Mexico............................................................................................................................................... 32 Central America................................................................................................................................ 34 Andean region................................................................................................................................... 35 Southern Cone.................................................................................................................................. 38 Chapter 4: Physical Security growth in Latin America...............................................................40 Industry economic data..................................................................................................................... 42 Private security market...................................................................................................................... 43 Chapter 5: Freight and cargo prices High freight rates overshadow the economic recovery............................................................56 High freight rates overshadow the economic recovery.................................................................... 58 Chapter 6: Latin American economies, a gradual recovery.......................................................60 Volatility in financial markets............................................................................................................. 62 Impact on trade and value chains..................................................................................................... 63 Balance of financial flows to the region............................................................................................ 65 Evolution of GDP in Latin America.................................................................................................... 66 Future perspectives........................................................................................................................... 68 Inflation expectations 2022-2023...................................................................................................... 71 Macroeconomic analysis................................................................................................................... 72 Reference index........................................................................................................................90

LATIN AMERICA PHYSICAL SECURITY INDUSTRY MARKET STUDY 2023

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How is it done?

Latin Press, Inc., with the support of Ventas de Seguridad magazine and Latin Market Research, introduce, for the first time, a report for the physical security industry, in order to generate value for this sector and boost growth of the industry.

This, then, made it possible to consolidate the list with the most outstanding companies in Latin America, divided into four subregions (Mexico, Central America and the Caribbean, Andean Region, and Southern Cone).

Latin Press has been producing these reports in recent years, which were conceived as an initiative that other international economic media have also successfully published.

Methodology The figures published in the physical security ranking are obtained from information from the survey platform, Dun & Bradstreet, and from companies consulted in 2022. The position in the ranking is given by the companies highest income; the last places are occupied by those who do not have data corresponding to income. The companies that do not have either of the two data are located in alphabetical order.

The report also includes the Top 100 ranking of physical security companies, which is ranked based on the revenue companies obtained in 2021.

To carry out this ranking, a complete compilation of information was made on the most recognized companies in Latin America, in addition to a detailed follow-up by the Latin Market Research team which was supported by expert consultants and professionals with extensive industry knowledge.

You can also apply to your company by writing to editorial@latinpressinc.com.

LATIN AMERICA PHYSICAL SECURITY INDUSTRY MARKET STUDY 2023

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Introduction The world economic outlook continued to weaken during the last two years, the crisis has triggered a contraction in international trade, and has caused strong fluctuations in high prices as a consequence of the volatility in financial markets, which is why it has become lower returns and higher risk aversion.

For this reason, investment has been losing dynamism in the world despite liquidity and low interest rates. This is directly related to the current level of uncertainty.

These disparities and asymmetries arise not only from short-term growth dynamics, but also from the ability to sustain growth in the medium term.

According to the estimates of the International Monetary Fund (IMF), “the group of advanced economies is the only one that in 2022 would resume the growth trajectory registered before the pandemic, and would even surpass it. The other groups of countries will produce, in the medium term (until 2025), on a growth trajectory much lower than that predicted before the pandemic”.

In relation to the current scenario, this industry also faces great obstacles, mainly due to the economic and social circumstances that several Latin American countries are going through.

However, as will be seen in this report, entrepreneurs have been able to sustain and move forward with their businesses, adapting to a new normal and

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facing the harsh measures imposed by governments to try to contain the pandemic as well as the market volatility, the decreased demand, the falling trade, capital flows, economic deficit, financial stability and investment risks.

The growth forecast is for it to slow from 6.1% last year to 3.2% in 2022, 0.4 percentage points less than in the April 2022 World Economic Outlook.

According to the latest projections of the Monetary Fund, published in July 2022 “the lower growth at the beginning of this year, the reduction in the purchasing power of households and a tighter monetary policy prompted a downward revision of 1.4 percentage points in the United States.”

According to ECLAC, “in subregional terms, a slowdown in the expansion rates is observed in both South America and Mexico and Central America in the first quarter of 2022 compared to the same quarter of the previous year.”

Compared to the previous year, the growth dynamics in 2021 were led by domestic demand. Private consumption was a key driver, contributing around half of the growth in the second quarter.

On the other hand, the United Nations Conference on Trade and Development (UNCTAD) warned that “world consumer prices will significantly affect in 2023 until the interruptions in the supply chain, port restrictions and deficiencies are resolved. Import terminals.”

World merchandise trade volume, 2019 Q1-2023 Q4 Seasonally adjusted volume index, 2015 = 100

130

Asia Africa Europe North America South America Oceania

125 120 115 110 105 100 95 90 85

2023 Q3

2023Q1

2022 Q3

2022 Q1

2021 Q3

2021 Q1

2020 Q3

2020 Q1

2019 Q3

2019 Q1

2018 Q3

2018 Q1

2017 Q3

2017 Q1

2016 Q3

2016 Q1

2015 Q3

2015 Q1

80

Note: Each shaded region represents a typical error band of +/-0.5 around the central forecast.

Source: WTO and UNCTAD, WTO Secretariat estimates.

LATIN AMERICA PHYSICAL SECURITY INDUSTRY MARKET STUDY 2023

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The Market Study of physical security entrepreneurs in Latin America, 2022-2023 analyzes how this economic outlook would impact the industry, by country.

In addition, it addresses key industry information, such as the import figures carried out by companies in each country, the most used equipment brands in the region, the segments with the highest investment in physical security services, even sales figures for several companies, along with detailed contact information about the companies that are part of the 2022 ranking of the sector.

Readers will also get a complete overview of physical security companies in Latin America, as well as comments and recommendations on technology trends, investment opportunities, main risks and challenges for the sector. Additionally, for this 2023, the market

study addresses the following chapters: “Physical security market.”

“Perspectives of entrepreneurs and experts.”

“Physical security services growth in Latin America.”

“Top 100 Physical security companies ranking.”

“Rise in freight and cargo prices: reasons and forecasts.”

“Latin American Economies, a gradual recovery.”

In addition, the document develops other key aspects of the industry, originated by technological trends, the main segments served in relation to physical security services, top brands used during the last year, growth according to independent and dependent variables and the outsourcing human talent and projection of economic growth of Latin America to 2022.

TARGET AUDIENCES • Entrepreneurs in the physical security industry.

• Manufacturers and distributors of physical security equipment.

• Market analysts and researchers.

• Government and financial institutions.

• Investors.

• End users with projects that include physical security services.

MAIN SEGMENTS ATTENDED IN PHYSICAL SECURITY 2022 - LATIN AMERICA 1,89% 3,55% 4,03% 10,00%

26,0%

15,19% 20,3% 19,04%

COMERCIAL INDUSTRIAL GOBIERNO RESIDENCIAL EDUCATIVO CORPORATIVO HOTELERO HOSPITALARIO

LATIN AMERICA PHYSICAL SECURITY INDUSTRY MARKET STUDY 2023

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CHAPTER 1

MAIN SEGMENTS ATTENDED IN PHYSICAL SECURITY 2022 The main segments served by physical security companies during 2022 evidenced a heterogeneous sample in the Mexico and Central America region, where the industrial and commercial sectors have a greater demand, the growth in these sectors can be explained by the need to protect systems, buildings and related support infrastructure against threats associated with the physical environment and that could be greater with the return to face-to-face.

In the case of the Andean Region, the sample shows that the commercial segment has greater demand and therefore supply. Physical security in shopping centers is one of the most complex issues in its structure and organization, since the purpose of these places has changed. Currently, they must be strategic and comprehensive plans that contemplate not only Industrial Security Risks, such as possible fires, power outages or natural phenomena, but also integrate physical security risks such as: Intrusion (unauthorized access), theft, personal aggression, vandalism, arson, crowds, attacks and others.

On the Southern Cone side, the percentages show that there are segments that significantly decreased their offer, such as education, corporate, hotel and hospital.

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MAIN SEGMENTS SERVED IN PHYSICAL SECURITY 2022 ANDEAN REGION

MEXICO AND CENTRAL AMERICA 5.67% 7.67%

15.36%

27.20%

28.00%

8.67% 17.18%

11.50% 24.06%

15.23%

COMMERCIAL INDUSTRIAL RESIDENTIAL EDUCACTION

21.08%

18.38%

CORPORATE HOTELS HOSPITAL

INDUSTRIAL RESIDENTIAL

COMMERCIAL EDUCATION GOVERNMENT Source: Survey carried out on an online platform among businessmen of the Physical Security Companies Market Study between September 15 and October 31, 2022.

SOUTHERN CONE

ALL LATIN AMERICA 1.89% 3.55% 4.03% 10.00%

15.00%

26.00%

40.00%

20.00%

15.19% 20.30% 25.00%

GOVERNMENT COMMERCIAL INDUSTRIAL RESIDENTIAL

19.04%

COMMERCIAL INDUSTRIAL GOVERNMENT RESIDENTIAL

EDUCATION CORPORATE HOTELS HOSPITAL

LATIN AMERICA PHYSICAL SECURITY INDUSTRY MARKET STUDY 2023

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TOP MOST USED BRANDS BY PHYSICAL SECURITY COMPANIES 2022

CAMERAS HIKVISION DAHUA AVIGILON HANWHA VIVOTEK AXIS FLIR BOSH PANASONIC MOTOROLA HELLOSECURITY

2.70% 3.00% 4.00% 5.00%

29.00%

7.00% 7.30% 8.00% 12.00%

22.00%

16.00%

VMS GENETEC MILESTONE BRIEFCAM SCATI

38.00%

18.00%

28.00%

25.00% 43.50%

OWN VMS HIKVISION UNIVIEW DAHUA

31.50%

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TOP MOST USED BRANDS

BY PHYSICAL SECURITY COMPANIES 2022

ALARMS DSC HONEYWELL SECO-LARM BOSCH TYCO SOFTGUARD TECHNOLOGIES TEKO DAHUA HIKVISION

3.00% 4.00% 5.00% 6.00%

28.00%

7.00% 9.00% 26.00%

12.00%

ACCESS CONTROL

ACTIVE TRACK EBS SMARTPANIC (TECNOLOGÍA DE SOFTGUARD) VOTI GARRETT

19.00%

9.00%

ZKTECO SUPREMA HID GLOBAL ROSSLARE CAME CDVI LENEL KEYSCAN TYCO

EQUIPMENT OR TECHNOLOGIES USED BY PHYSICAL SECURITY GUARDS

4.00% 4.00% 8.00%

16.00% 12.00% 13.00%

15.00%

14.00%

39.00%

19.00%

*Fuente: Descartes Datamyne e ITC, con información oficial.

28.00%

Source: Survey carried out on an online platform among businessmen of the Physical Security Companies Market Study between September 15 and October 31, 2022.

ESTUDIO LATIN DE MERCADO AMERICAINDUSTRIA PHYSICAL DE SECURITY MONITOREO INDUSTRY EN LATINOAMÉRICA MARKET STUDY 2023 2022

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Growth according to dependent and independent variables Growth expectations for 2022 80,00%

68.42%

70,00% 60,00% 50,00% 40,00% 30,00%

21.05%

20,00%

10.53%

10,00% 0,00% Between 10% and 20%

From 20% to 30%

Above 30%

Percentage of projected growth

Private security market figures

2400000

160000 Private security companies

11 People involved in the industry

Compound annual growth rate for the entire industry (%)

Source: Own elaboration, with official data collected through Surveys and Reports from government entities.

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MARKET STUDY LATIN FOR AMERICA THE PHYSICAL PHYSICAL SECURITY SECURITY INDUSTRY INDUSTRY IN MARKET LATIN AMERICA STUDY 2023

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CAHPTER 2 16

LATIN AMERICAN PHYSICAL SECURITY BUSSINESMEN OUTLOOK

Mexico

Impacto Total en Seguridad Privada Integral S.A. de C.V Carlos Ramírez Ángel Commercial manager

• Describe your company’s services: We focus on providing the most advanced electronic security technologies to the national market, always informed of the new trends and diversity of electronic security systems worldwide, in addition to having the necessary permits to operate at the federal, state and municipal levels.

We are committed to satisfying the different needs of each of our clients, since we have highly trained personnel to develop any system that is requested.

• How many employees do you currently have?

1,320.

Grupo IPS México Armando Zúñiga Salinas President and Founder

• Describe your company’s services: At IPS, we are a private security company that, since our foundation, we have focused on permeating values in each of our employees. Now we make this commitment even more present, with the application of the culture of Corporate Social Responsibility and with a well-defined vision and mission.

Among our philosophy, it is of vital importance to guarantee quality and professionalism to satisfy the needs of clients who use our services and also the satisfaction of the internal client (employees), managing their social benefits, payroll and equipment in a timely manner.

• Share with us the number of clients you had during the last year (2022) 382 clients, 10 business units, 15 alliances.

• What associations does it belong to and what certifications do it have?

Certificates and accreditations: We focus on providing the most advanced electronic security technologies to the national market, always informed of the new trends and diversity of electronic security systems worldwide, in addition to having the necessary permits to operate at the federal level, state and municipal.

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PHYSICAL SECURITY BUSSINESMEN OUTLOOK

Safe Environments Seguridad Privada Clara Yadira Reyes Meza CEO

• Describe your company’s services: We are authorized to operate as a provider of private security services throughout the Mexican Republic and in any of the modalities provided for in the Federal Private Security Law; Likewise, we have a Private Collective License to carry firearms.

Protection, custody, safeguard, defense of life and bodily integrity of our clients. Specialized services for senior officials, diplomats, businessmen and infants.

Grupo Control Seguridad Privada Integral

Carlos Martínez Chávez Communication Coordinator • How many employees do you currently have?

3,222.

• Describe your company’s services: Our security services are comprehensive, in addition to having intramural protection, we also have monitoring and custody services, so that your assets will always be safe in the hands of control.

We offer security guard services that protect the facilities through access controls, patrols and general and specific instructions for each service.

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Central America

Seguridad Permanente y Protección SA

Servicios Integrales de Seguridad Privada Mario Álvarez H General Manager Honduras

Dyana Díaz Communications and Marketing Manager Panama

• How many employees do you currently have?

1,200.

• How many employees do you currently have?

1,400.

• How many employees of your company are dedicated to surveillance / physical security?

1,350.

• Have you opened or closed offices in other cities or countries in the last year?

We maintain the same number of offices, 8 branches nationwide.

• What associations does it belong to and what certifications do it have?

ISO 9001 2015, BASC, DIASP.

• Have you opened or closed offices in other cities or countries in the last year?

No, we stand.

• What associations does it belong to and what certifications do it have?

ALAS, Icoca.

• Tell us about your growth and revenue prospects for 2023.

From 10 to 20%. It depends on how the market moves.

• In which cities do you have the greatest participation?

In the main cities of the country.

• Share with us an approximate sales figure in dollars for the income generated in the physical security services provided during the last year.

USD $19 000000 in 2021.

• Tell us about your growth and revenue prospects for 2023 From 10 to 20%.

• How many services did your company have in 2022?

99 services.

• In which cities do you have the greatest participation?

Panama, Chiriqui.

• Share with us the number of clients you had during the last year (2022). Tell us about any of them.

99 satisfied customers.

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PHYSICAL SECURITY BUSSINESMEN OUTLOOK

Andean region

Grupo Colombiano de Fortox Security Jesús Tovar Seguridad Integral Colombia

• Describe your company’s services: We are a company with 35 years of experience in the national market, authorized and monitored by the Superintendency of Private Security and Surveillance, with high quality standards, managing comprehensive security solutions for companies and institutions thanks to our certified systems under international management standards. Quality, safety and health at work, environment, security management for the supply chain and management of private security operations.

In addition, we seek to avoid, prevent, and reduce the probability of the consequences of undesirable or disruptive events.

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Operations manager

• Describe your company’s services: Private security and surveillance company with more than 47 years of experience in the sector nationwide and more than 9,000 security men and women committed to protecting the lives and property of our clients.

• How many employees do you currently have?

1,674

Miro Seguridad LTDA

Juan José Torrez Loza

• Describe your company’s services: We are a private surveillance and security company with more than 39 years of experience, generating peace of mind and well-being from the quality of our services, with innovative security proposals, integrating personnel who love what they do, focused on a culture of leadership that allows transformation of the organization that respects the environment and contributes to social development.

• How many employees do you currently have?

180.

Laura González Walteros Wellness and Training Coordinator

• How many employees do you currently have?

More than 7,000 employees.

• In which cities do you have the greatest participation?

In more than 24 cities nationwide.

S&T Seguridad General Manager Bolivia

• Have you opened or closed offices in other cities or countries in the last year?

We have opened offices in 3 cities in the last year.

• What associations does it belong to and what certifications do it have?

CADESP - FEBOSP AND Police certifications as from the Ministry of Government.

• Share with us an approximate sales figure in dollars for the income generated in the physical security services provided during the last year.

US $300 000.

• Tell us about your growth and revenue prospects for 2023.

Exceed 20 to 30% as the main objective.

• How many services did your company have in 2022?

More than 200.

• In which cities do you have the greatest participation?

La Paz, Cochabamba and Santa Cruz.

• Share with us the number of clients you had during the last year (2022). Tell us about any of them.

We implement systems and programs for a better control of registration of news, visits, surveillance with drones and motorized vehicles in gated communities.

Obtaining a communication channel with detailed characteristics in real time. In this way, immediate responses were offered to potential risk situations.

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PHYSICAL SECURITY BUSSINESMEN OUTLOOK

Southern Cone JL Seguridad Peru

• Describe your company’s services: We provide the Security service for our clients, as well as the custody of their clients and their environment.

We work by assigning a strategic security plan according to our client and then integrating it with our security services.

Likewise, we offer highly trained personnel according to the category of our client, the assigned surveillance zone and the risks in which they will be involved.

• How many employees do you currently have?

295.

• In which cities do you have the greatest participation?

10 agencies in Peru.

• Share with us an approximate sales figure in dollars for the income generated in the physical security services provided during the last year.

There is a growth of 20.04% per year.

• What associations does it belong to and what certifications do it have?

ISO 14001:2015 Environmental Management System, ISO 9001:2015 Quality Management System, ISO 45001:2018 Occupational Health and Safety Management System.

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AVIC Seguridad Mariano Picone General Manager Argentina

• How many employees of your company are dedicated to surveillance / physical security?

From 50 to 100. 74 employees are dedicated to physical security.

• Share with us an approximate sales figure in dollars for the income generated in the physical security services provided during the last year.

US $1 000 000.

• Tell us about your growth and revenue prospects for 2023.

From 10 to 20%.

• How many services didyou have in 2022?

15 targets.

• In which cities do you have the greatest participation?

Ushuaia and Rio Grande - Tierra del Fuego - Argentina • Share with us the number of clients you had during the last year (2022). Tell us about any of them.

10 physical security clients. Banks, Plastic, Financial Industries, Gated Communities among others.

Mcm security S.R.L María Luján Rombolá HR Manager H.

• Describe your company’s services: The guards are key within the physical security system, for this reason we have personnel selected by HR specialists, who in each selection carry out the psychological evaluation that determines the aptitudes and qualities of the applicants.

Then, they carry out an intensive training and training plan, which prepares them to cover any type of service.

Our security guards have responsibility, patience, discretion and the ability to resolve any unforeseen events, characteristics necessary to perform satisfactorily and guarantee a quality and trustworthy service.

• What associations does it belong to and what certifications do it have?

We are certified under the ISO 9001 standard, which guarantees a quality management system to satisfy the requirements of our clients.

We are authorized to provide service in CABA, GBA and Naval Prefecture, we comply with all the requirements and regulations of the Security Directorate.

• How many employees do you currently have?

More than 500 employees.

• Share with us the number of clients you had during the last year (2022). Tell us about any of them.

5 customers.

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EXPERTS / CONSULTANTS OUTLOOK

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“TODAY’S TECHNOLOGIES, GOOD OR BAD, EDGE OR LATEST GENERATION, ARE A ISSUE OF RESOURCES FINANCIAL, HOWEVER, KNOW THAT YOU SERVE THE UN DETERMINED PURPOSE (THREAT) IS TASK OF THE SECURITY MANAGER AND THIS IS THE CHALLENGE”.

Alfredo Iturriaga

Executive Vice President RacoWind Consultores SL

• HOW DO YOU ANALYZE THE PHYSICAL SECURITY INDUSTRY? Physical security will never cease to have its foundational importance, since it involves people and their actions with the environment, people being the weakest link in the security chain. Consequently, all the elements that make up physical security acquire capital importance: Access controls, CCTV, perimeter fences, alarms, lighting.

• WHAT IS YOUR PERCEPTION OF THE INDUSTRY AT THE PRESENT TIME? Security directors have never been closer to the CEO of companies. The reason is very simple, we are experiencing scenarios called VUCA (Volatile uncertain - complex - ambiguous), which requires risk management in a very professional manner and with a great sense of anticipation.

It is also worth remembering that today the perimeter has grown vertically, that is, the threats now also come from the sky, with the proliferation of drones.

The foregoing implies that physical security companies must be constantly updated, to be up to the speed of technological advances that are their ABC.

Today the security director, for the reasons explained above, is on the CEO’s WhatsApp list. With this, I want to point out the importance and relevance that the security industry and all its components are having today.

• HOW WOULD YOU DESCRIBE THE EVOLUTION OF THE INDUSTRY, LOOKING FROM THE LAST 3 YEARS? It is on par with technological advances, and it could not be otherwise, those who do not do so

LATIN AMERICA PHYSICAL SECURITY INDUSTRY MARKET STUDY 2023

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EXPERTS / CONSULTANTS OUTLOOK Growth and evolution have been exponential.

However, in such a demanded market there are good and bad physical security companies and there is a tempting risk of evaluating and choosing them because of the low values of their products and systems, which does represent a greater risk, since a security system It cannot fail, because from this failure, security is discredited and loses value, which makes companies vulnerable.

• WHAT HAVE BEEN THOSE MOST SIGNIFICANT CHANGES, BOTH IN THE PROCESSES IMPLEMENTED AND IN THE PROTOCOLS? I would say that the most transcendental change is that security is being seen as a business lever, at the business strategic level (even though there is still a long way to go), to the extent that the person responsible for security is no longer Not only the security director, but also the person in charge of security today is the “OWNER OF THE RISK”, that is, the line in general.

• WHAT DO BUSINESSMEN NEED (IN TERMS OF RISK ANALYSIS) TO CONTINUE PROMOTING THIS INDUSTRY? What a good question! Entrepreneurs need to take security seriously, work with it as a business lever, just as there is a need to delve into finance, operations, marketing, human talent and all the functions that are normally finding themselves on the front line (CEO spam); the foregoing requires having a “CERTIFIED” professional in Corporate Strategic Security, in such a way that he is capable of fulfilling the mission of contributing to the business and not remaining in security management at the operation level.

• ANOTHER RELEVANT ASPECT HAS BEEN THE GENERATION OF CAPACITIES FOR HUMAN TALENT. HOW IS THE SUPPLY OF PERSONNEL GIVEN IN THE MIDST OF THE ECONOMIC AND SOCIAL SITUATION THAT MANY LATIN AMERICAN COUNTRIES ARE GOING THROUGH? Well, the need creates the organ and facing threats that we did not know about, such as the pandemic or civil insurrections (misnamed social outbreaks), since the question concerns Latin America; it has necessarily been understood that the best way to deal with all of this is with frontier knowledge, and with leaders with exponential growth.

It is about managing business security risks (ESRM), in a holistic way, developing Strategic and Competitive Intelligence programs, programs in charge of business continuity management and organizational resilience.

This has been demonstrated in the growing interest of security professionals in becoming certified, both in strategic security management and in more specific areas, such as physical security or investigations.

• WHAT ARE THE MAIN BUSINESS CONTINUITY RISKS IN THE SECURITY INDUSTRY? Not having strategic security plans that allow business continuity, where the company’s critical processes and assets are defined, the impact on the business of the different risks in those processes are analyzed, both in their operational and financial aspects (BIA) through an appropriate strategy. Additionally, it is important to take into account that the plans must be inoculated in the organization and permanently tested.

• WHY IS TRAINING SO IMPORTANT? WHAT HAVE BEEN THE FORMS OF SUPERVISION AND KNOWLEDGE IN THE TRAINING? WHAT IS NEEDED TO IMPROVE? Basic training and permanent training are the foundation of continuous improvement, therefore, any effort made by companies in these aspects will never be superfluous.

are destined to disappear from the market.

Another risk is also not having trained professionals to perform and manage them.

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Security is that area of the business that has a tremendous particularity. It is about having the knowledge and skills to design security programs that are tailored suits (Tylor Made) for the company itself, no matter how much we have com-

panies in the same industry, for example, Retail, none will work the same to another. In terms of security and consequently each one will require security programs duly adjusted to their culture values and needs. In this sense, the company must invest in its security executives (at all levels) and retain them through training.

• WHAT ARE THE BIGGEST CHALLENGES FOR THE ADOPTION OF NEW TECHNOLOGIES IN PROCESSES AND IN THE DEVELOPMENT OF SKILLS WITHIN THE INDUSTRY? The challenge, for security management, is not fundamentally rooted in the acquisition of new technologies, although one must always be at the forefront; The issue is having the human capacities to know them and know how to apply and manage them.

Technologies today, good or bad, state-of-the-art or last generation, are a matter of financial resources, however, knowing that it serves a certain purpose (threat) is the task of the security administrator and this is the challenge, educated professionals and trained in the latest technologies.

LATIN AMERICA PHYSICAL SECURITY INDUSTRY MARKET STUDY 2023

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EXPERTS / CONSULTANTS OUTLOOK “ONE OF THE MAIN RISKS IN THE CONTINUITY OF BUSINESS INTO THE INDUSTRY IS BECAUSE OF INFORMALITY, THE DISPARITY IN COSTS DUE TO INFLATION AND THE CONTRACTING TERMS GIVEN BY THE COMPETITION.”

ASPROSEG

Association of Security Professionals of the Province of Cordoba • LET’S START FROM THE MOST GENERAL: WHAT IS YOUR PERCEPTION OF THE INDUSTRY AT THE PRESENT TIME? Currently, a need arises due to the lack of private security and more experts in the area. In addition to having more colleges of security professionals.

• HOW DO YOU ANALYZE THE SECTOR OF PHYSICAL SECURITY COMPANIES? In the case of physical security in the province of Córdoba, 15% is informal and there are 15,000 employees in the area.

• HOW WOULD YOU DESCRIBE THE EVOLUTION OF THE INDUSTRY, LOOKING FROM THE LAST 3 YEARS? The custody of men and companies has begun to be implemented, this has allowed it to evolve towards

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technical management. There is more planning and diagnosis. Additionally, there is an official title, which increases the cost.

• WHAT DO BUSINESSMEN NEED (IN TERMS OF RISK ANALYSIS) TO CONTINUE PROMOTING THIS INDUSTRY? A law update is missing that is more compatible with electronic security. In addition, a link between business, government and academia. In the case of Argentina, there is a need to unify the laws, including the training of private security (which is not carried out in Córdoba).

• WHAT ARE THE MAIN BUSINESS CONTINUITY RISKS IN THE SECURITY INDUSTRY? One of the main risks in the continuity of business in the industry is informality, disparity in costs due to inflation, the contracting terms given by the competition (security work cooperatives).

Also, the non-visibility of the professional (trade-activity: experience) and the pairing with those who do not have a degree is a risk.

On the other hand, the increase in the cost of private services and the lack of authorization and integration of new technologies.

• WHAT HAVE BEEN THOSE MOST SIGNIFICANT CHANGES, BOTH IN THE PROCESSES IMPLEMENTED AND IN THE PROTOCOLS? The implementation of an added value in training, the handling of explosives. The execution of a new role in physical security, such and such is the custody of hospitals, private care, visits and containment of the virus.

• ANOTHER RELEVANT ASPECT HAS BEEN THE GENERATION OF CAPACITIES FOR HUMAN TALENT. HOW IS THE SUPPLY OF PERSONNEL GIVEN IN THE MIDST OF THE ECONOMIC AND SOCIAL SITUATION THAT MANY LATIN AMERICAN COUNTRIES ARE GOING THROUGH? There is still a way to go. Human talent must be supported with technology, that is the challenge in conjunction with electronic security. It is important to provide security and protection elements, give a greater interpretation of a guard’s collaboration to a client, improve management areas, such as logistics information and production processes.

• WHY IS ONGOING TRAINING IMPORTANT? WHAT HAVE BEEN THE FORMS OF SUPERVISION AND KNOWLEDGE IN THE TRAINING? WHAT IS NEEDED TO IMPROVE? Currently, there is a lack of training and motivation services. It is also necessary to increase investment and validate costs. You have to detect security and opportunities that exist.

• WHAT ARE THE BIGGEST CHALLENGES FOR THE ADOPTION OF NEW TECHNOLOGIES IN PROCESSES AND IN THE DEVELOPMENT OF SKILLS WITHIN THE INDUSTRY? There is no compliance with the law in professionalization and training in the use of technology. *The interview was answered by the main members of the association.

LATIN AMERICA PHYSICAL SECURITY INDUSTRY MARKET STUDY 2023

29

30

CHAPTER 3

100

PHYSICAL SECURITY INDUSTRY RANKING BY REGION

LATIN AMERICA PHYSICAL SECURITY INDUSTRY MARKET STUDY 2023

31

Mexico Position

Company

Representative

Info web

Income ($USD)

1

G4S

Dana Lau 52 55 53370400

informacion@mx.g4s.com www.g4s.com

$68,000 millions (Modeling)

2

GRUPO MULTISISTEMAS DE SEGURIDAD INDUSTRIAL

Waldo Figueroa Rosete 52 55 4144 2529

comercial@multisistemas.com.mx www.multisistemas.com.mx

$209,810,000 (Modeling)

3

SECURITAS MÉXICO

Mauricio Miranda 52 55 2 6363700

mauricio.miranda@securitas.com.mx www.securitas.com.mx

$67,100,000 (Current)

4

INTER-CON SERVICIOS DE SEGURIDAD PRIVADA, S.A. DE C.V

Armando Acosta 52 55 13461000

info@intercon-mexico.com www.interconmexico.com.mx

$44,280,000 (Current)

5

MSPV SEGURIDAD PRIVADA, S.A. DE C.V.

Mustapha Sahali 52 55 5399 9937

m.sahali@mspv.com.mx www.mspv.com.mx

$34,910,000 (Current)

6

ALLIED UNIVERSAL PRIVATE SECURITY SERVICES, S.A. DE C.V.

Karla Vázquez 52 55 53370400

karla.vazquez@aus.com www.aus.com

$32,400,000 (Current)

7

GRUPO INTERNATIONAL PRIVATE SECURITY DE MÉXICO, S.A. DE C.V

Gabriela Aguilar 52 55 5525 3242

contacto@grupoipsmexico.com www.grupoipsmexico.com

$32,290,000 (Current)

8

EULEN DE SEGURIDAD PRIVADA, S.A. DE C.V.

Luis Manuel Alcocer Gutierrez 52 5002 7000

NA www.eulen.com

$26,780,000 (Current)

9

SERVISEG, S.A. DE C.V.

Karla Bianca Guerrero 52 5554834400

info@serviseg.com.mx www.serviseg.com.mx

$25,680,000 (Current)

10

GRUPO ESPECIAL DE SEGURIDAD PRIVADA MEXICO GESPRIME

José Humberto Carrillo Montes 52 1 55 3412 1575

humberto.carrillo@grupoespecialmexico.com www.grupoespecialmexico.com

$22,550,000 (Modeling)

11

GRUPO CONTROL SEGURIDAD PRIVADA INTEGRAL, S.A. DE C.V

Ernesto Guerrero Zarco 52 5546047349

eguerrero@seguridadcontrol.com.mx www.seguridadcontrol.com.mx

$17,320,000 (Current)

12

JJB INVERSIONES, S.A. DE C.V. (PROGUARDIAS)

Erika Ruiz Mireles 52 8183487839

info@proguardias.com www.proguardias.com.mx

$13,480,000 (Current)

13

PROSEGUR TECNOLOGÍA S.A. DE C.V.

Daniel Ballato 52 55 86283000

daniel.ballato@prosegur.com www.grupoprosegur.com.mx

$6,880,000 (Current)

14

MONITOREO Y SEGURIDAD PRIVADA, Nicolás Pineda Sánchez S.A. DE C.V. 52 55 2626 2426

comercial@moseg.com.mx www.moseg.com.mx

$6,260,000 (Current)

15

SERVICIOS PRIVADOS DE SEGURIDAD I, S.A. DE C.V.

mchavezf@seguridadsps.com.mx www.seguridadsps.com.mx

$5,300,000 (Current)

32

Mario Chávez Elizondo 52 8181305408

Mexico Position

Company

Representative

Info web

Income ($USD)

16

FORMACIÓN PERSONALIZADA EN VIGILANCIA, S.A. DE C.V.

Ignacio Ortiz Pérez 52 5510693834

ventas@vigilantiaseguridad.com www.vigilantiaseguridad.com

$4,100,000 (Current)

17

RMS SEGURIDAD PRIVADA, S.A. DE C.V

Carlos Macias 52 55 9020 0001

contacto@rmsseguridad.mx www.rmsseguridad.mx

$3,260,000 (Modeling)

18

ASI SEGURIDAD PRIVADA, S.A. DE C.V.

Joel Juárez Blanco 52 55 5719 0072

www.asiseguridadprivada.com

$1,320,000 (Current)

19

SEDEGRAL SEGURIDAD PRIVADA, DEFENSA EN GENERAL, S.A. DE C.V.

David Ramón Mandujano 52 9933379840

ventas@gruposdg.com www.sedegral.com

$1,190,000 (Current)

20

CONCORD DEFENSE

Carlos Contreras 52 55 5272 9517

contreras@defense.mx www.concord.mx

$462,530 (Modeling)

21

SEPSISA

Manuel Cruz 52 55 5351 0402

ventas@sepsisa.com.mx www.sepsisa.com.mx

$299,750 (Modeling)

22

GG SEGURIDAD PRIVADA

René Allende 52 56 4158 7590

contactoweb@ggseguridad.com.mx www.ggseguridad.mx

$275,310 (Current)

23

GSM SEGURIDAD

Edgar Ulises Díaz 52 55 5770 3077

ventas@sepsisa.com.mx www.gsmseguridad.com.mx

$82,170 (Modeling)

24

SAFE ENVIRONMENTS SEGURIDAD PRIVADA, S.A. DE C.V.

David Camarillo 52 55 5203 9088

directorgeneral@safeseguridadprivada.com www.safeseguridad.mx

$82,170 (Modeling)

25

MULTIPRODUCTOS DE SEGURIDAD PRIVADA S.A. DE C.V.

Miguel Ángel Champo 52 5555945513

info@multiproseg.com.mx www.multiproseg.com.mx

$82,170 (Modeling)

26

MEXSEPRO S. DE R.L. DE C.V.

Adhaf Raul Hatem 52 5565854448

raulhatem@mexsepro.com www.mexsepro.com

$13,960 (Current)

27

ADAMANTIUM PRIVATE SECURITY SERVICES, S. DE R.L. DE C.V.

Luis Cardenas Palomino 52 5580646309

adamantium237sp@gmail.com www.adamantiumseguridadprivada.com

$81,670 (Modeling)

28

DOORMAN PLUS, S.A. DE C.V

Mako Nancarrow 52 5555468229

direccion@doorman.com.mx www.doorman.com.mx

$70,350 (Modeling)

29

GUARDIAS DE SEGURIDAD PRIVADA EN MÉXICO

NA 52 55 5711-2226

dir@seguridadgmi.com www.melider.com.mx

NA

30

SEGURIDAD GC

Luis Rafael Gil 52 55 5535 9462

ventas@seguridadgc.com www.seguridadgc.com

NA

Note: The published figures are obtained from information from the D&B Hoovers Platform (Data from 2021 and 2022). It should be noted that the position is given from highest to lowest income.

The last places are occupied by those who do not have data corresponding to income or sales. The companies that do not have any of the two data are ranked in alphabetical order.

LATIN AMERICA PHYSICAL SECURITY INDUSTRY MARKET STUDY 2023

33

Central America Position

Company

Representative

1

AGO SECURITY DE COSTA RICA, S.A.

Anthony Nuñez Jiménez 506 2430 6359

2

PROTEC INTERNACIONAL PRIVADA

3

Info web

Company

Income ($USD)

m.cascante@grupoago.com ww.seguridad-privada-costa-rica.info

Costa Rica

$90,000,000 (Modeling)

Julio Gomez Viyella 809 563 5352

juliogomezv@protecinternacional.com www.protecinternacional.com

Dominican Republic

$63,000,000 (Current)

COPS K-NUEVE, S.A.

Ronald Sancho 506 2263-9093

info@k-9corporation.com www.k-9internacional.com

Costa Rica

$32,7200,000 (Current)

4

GRUPO SIS, S.A

Luis Alberto López 502 242 92200

info@gruposis.com www.gruposis.com

Guatemala

$11,880,000 (Modeling)

5

CONCORD SECURITY

Edwards Joel Mendoza 507 6949 1573

administracion@concordsecurity.com.pa www.concordsecurity.com.pa

Panama

$10,020,000 (Modeling)

6

G4S

Roberto Gamero 503 250 06285

roberto.gamero@sv.g4s.com www.g4s.com

Honduras / El Salvador/ Nicaragua

$7,860,000/ $1,260,000 / $1,030,000 (Modeling)

7

SPC TELECENTINEL, S.A.

Joseph Jamri 506 4001 5757

comercial@spctc.cr www.spctc.cr

Costa Rica

$6,550,000 (Modeling)

8

AGENCIA DE SERVICIOS INTEGRALES DE SEGURIDAD PRIVADA S. DE R.I. DE CV

Mario Álvarez 50 2290 7100

gerente_general@securityasis.com www.securitysis.com

Honduras

$3,920,000 (Current)

9

SERVICIOS DE SEGURIDAD MOORE & STAHL, S.A.

Joel Chacón Madrigal 506 41031800

prandre@moorestahl.com www.moorestahl.com

Costa Rica

$3,520,000 (Current)

10

COMPAÑÍA DE SEGURIDAD E INVESTIGACIONES DE EL SALVADOR S.A. DE C.V.

Jorge castaneda 502 2414 6700

hn.operaciones@corporacioncomsi.com www.corporacioncomsi.com

El Salvador

$3,380,000 (Current)

11

SPS SECURITY PROTECTORS AND SOLUTIONS, S.A.

Eyal R 506 2291 6691

contacto@sps.cr www.sps.cr

Costa Rica

$1,600,000 (Modeling)

12

GERMAN SECURITY

Axel Batista 507 292 9318

abatista2589@gmail.com www.germansecurity.com.pa

Panama

$1,530,000 (Modeling)

13

SEGURIDAD C Y B

Victor Alberto Bárcenas 505 2280 9480

infor@seguridadcyb.com www.seguridadcyb.com

Nicaragua

$1,350,000 (Modeling)

14

SEGURIDAD PRIVADA SRL

Jose Oviedo 809 535 9585

soporte@seprisa.com.do www.seprisa.com.do

Dominican Republic

$1,280,000 (Modeling)

15

SERVICIO VIGILANCIA CORPORATIVO SRL

Carlos Cintrón 809 534 8128

ventasmonitoreo@servicorp.com.do www.servicorp.com.do

Dominican Republic

$1,280,000 (Modeling)

Note: The published figures are obtained from information from the D&B Hoovers Platform (Data from 2021 and 2022). It should be noted that the position is given from highest to lowest income.

The last places are occupied by those who do not have data corresponding to income or sales. The companies that do not have any of the two data are ranked in alphabetical order.

34

Andean Region Position

Company

Representative

Info web

Company

Income ($USD)

Colombia/Perú

$74,720,000 / $74,650,000 (Current)

1

G4S

Diana Barrera 57 601 7054040

diana.barrera@co.g4s.com www.co.g4s.com

2

FORTOX SECURITY

Carlos Andrés Dáaz Sánchez 57 6024874747

andresdiaz@internacionaldeseguridad. com www.fortoxsecurity.com

Colombia

$76,400,000 (Current)

3

SEGURIDAD Y VIGILANCIA COLOMBIANA, SEVICOL LTDA

Julio Enrique Anaya Rincon 57 6076457003

principal@sevicol.com.co www.sevicol.com.co

Colombia

$63,620,000 (Modeling)

4

SEGURIDAD SUPERIOR LTDA

Eduardo Uribe Eslava 57 6016230581

info@seguridadsuperior.co www.seguridadsuperior.com.co

Colombia

$63,560,000 (Current)

5

SECURITAS

Julio César Belalcázar 57 1 217 0081

julio.belalcazar@gmail.com www.securitas.com.co

colombia

$63,250,000 (Current)

6

MIRO SEGURIDAD LTDA

Jorge Botero Mesa 57 604 4481190

jorge.botero@miroseguridad.com www.miroseguridad.com

Colombia

$50,430,000 (Current)

7

EMPRESA DE SEGURIDAD VIGILANCIA Y CONTROL S.A.C

Elio Ricardo Ballon Rodriguez 51 14712552

ventas@esvicsac.com.pe www.esvicsac.com.pe

Perú

$46,850,000 (Current)

8

COLVISEG COLOMBIANA DE VIGILANCIA Y SEGURIDAD LTD

Andres Olarte Camacho 57 6015189191

aaolartec@yahoo.com www.colviseg.com

Colombia

$33,810,000 (Current)

9

SERACIS LTDA

Maria Teresa Panqueva 57 6044484518

atencionalcliente@seracis.com www.seracis.com

Colombia

$24,090,000 (Current)

10

ASESORIA, SEGURIDAD Y VIGILANCIA ASEVIG LIDERMAN CIA. LTDA

Juan Pablo Borja 59 3 42292477

info@liderman.com.ec www.liderman.com.ec

Ecuador

$23,660,000 (Current)

11

AMCOVIT LTDA

Franklin Moreno Carvajal 57 317 670077

info@amcovit.com.co www.amcovit.com

Colombia

$18,270,000 (Current

12

SEGUROC S.A

Jorge Luis Rocca 51 14632000

contacto@seguroc.com.pe www.seguroc.com.pe

Perú

$15,860,000 (Current)

13

JARA SEGURIDAD JARASEG CIA. LTDA

Gabriel Espinosa 59 02 2527 119

ventas@jaraseguridad.com.ec www.jaraseguridad.com.ec

Ecuador

$15,740,000 (Modeling)

LATIN AMERICA PHYSICAL SECURITY INDUSTRY MARKET STUDY 2023

35

Andean Region Position

Company

Representative

14

ALPHA SEGURIDAD PRIVADA LTDA

Francisco Duran Casas 57 6012878390

15

CELAR, LTDA

16

Company

Income ($USD)

info@alphaseguridad.com.co www.alphaseguridad.com.co

Colombia

$14,980,000 (Current)

Juan Carlos Giraldo Lopez 57 6018612240

celar@celar.com.co www.celar.com.co

colombia

$12,830,000 (Modeling)

GRUPO VICMER SECURITY S.A.C.

Aldo Oliver Herrera Cabrera 51 12660044

ventas@vicmersac.com www.vicmersecurity.com

Peru

$9,810,000 (Current)

17

SEGURIDAD MINERA INTERNACIONAL SEMINTER C. LTDA

NA 59 3 2 247 5955

info@seminter.com.ec www.seminter.com.ec

Ecuador

$6,480,000 (Current)

18

CORPRISEG

NA 01 717 31 15

informes@corpriseg.com.pe www.corpriseg.com.pe

Peru

$5,560,000 (Modeling)

19

PROSEGUR VIGILANCIA Y SEGURIDAD PRIVADA LTDA

Gian Franco Maza 51 1 421 2911

gianfranco.maza@prosegur.com www.prosegur.com.co

Peru / Colombia

$5,420,000 / $4,460,000 (Modeling)

20

COMPAÑÍA DE SEGURIDAD NACIONAL- COMSENAL

César Garzón 57 6015556638

gerencia@comsenal.com www.comsenal.com

Colombia

$5,210,000 (Current)

21

NOVA SEGURIDAD PRIVADA LTDA

Jonathan Villamizar 57 6044484052

Servicioalcliente@novaseguridad.com.co www.novaseguridad.com.co

Colombia

$4,870,000 (Current)

22

SERVISEGUR

Luis Navarrete 51 986 591 367

comercial@servisegur.com.pe www.servisegur.com.pe

Peru

$4,340,000 (Modeling)

23

GRUPO COLOMBIANO DE SEGURIDAD INTEGRAL

Edward Leonardo Medina 57 6016348201

coordinadora.comercial@gcsi.com.co www.gcsi.com.co

Colombia

$3,990,000 (Current)

36

Info web

Andean Region Position

Company

Representative

24

COOPERATIVA ESPECIALIZADA EN SEGURIDAD Y ESCOLTAS PROFESIONALES ASOCIADOS DE COLOMBIA

57 312 350 9889

25

COOPERATIVA DE TRABAJO ASOCIADO DE SERVICIOS DE VIGILANCIA Y SEGURIDAD PRIVADA COOSERVITEC CTA

26

Info web

Company

Income ($USD)

coopsercivicos@yahoo.es www.Coopsercivicoscta.com

Colombia

$3,850,000 (Current)

Jose Rolando Merchan Mayid 57 1 244 4878

cooservicta@gmail.com www.cooservicta.com

Colombia

$2,670,000 (Current)

SEGURTRONIC LTDA.

Nerso Arlevis Benitez 57 4 444 1926

direcciontecnicaydeproyectos@ segurtronic.com www.segurtronic.com

Colombia

$2,010,000 ( 2020 Current)

27

FERJEM SEGURIDAD

Juan Alfredo Zambrano Pisco 59 3 45044617

jzambrano@ferjemseguridad.com www.ferjemseguridad.com

Ecuador

$1,940,000 (Current)

28

COOPERATIVA SEGURIDAD Y VIGILANCIA DEL NORTE DE SANTANDER C T A COOSERVINORT

Alcibiades Ochoa 57 6075719448

cooservinort@gmail.com tesoreriacooservinort@gmail.com www.cooservinort.co

Colombia

$1,830,000 (Current)

29

COMPAÑIA DE VIGILANCIA Y SEGURIDAD ANDINO AVISEP CIA. LTDA

Marco Henry Quelal 59 3 999710871

gerencia@avisep.com www.avisep.com

Ecuador

$1,630,000 (Current)

30

AGIL SEGURIDAD AGILSEG CIA. LTDA

Richard Acosta 59 3 984258497

info@seiprac.com www.seiprac.com

Ecuador

$303,950 (Current)

31

JL SEGURIDAD

Pablo Flores 51 903 067 157

bautista@jlseguridad.com www.jlseguridad.com

Peru

$225,370 (Modeling)

32

COMPAÑIA DE SEGURIDAD PRIVADA PAQUISHASEG CIA. LTD

José Arturo Jérez 59 3 02 5128783

paquishaseg2009@hotmail.com www.grupopaquishaseg.com

Ecuador

$109,170 (Current)

33

CONSEG SEGURIDAD INTEGRAL PERU

Luis Ronald Álvarez 51 01 228 4265

comercial@conseg.pe www.conseg.pe

Peru

NA

34

CVL SEGURIDAD INTEGRAL,C.A

Daniel Palacios 58 212 2424532

ventas@cvl-seguridad.com www.cvl-seguridad.com

Venezuela

NA

35

GLOBALEYE SEGURIDAD C.A

Giovanni Solano 58 2129531951

mercadeo@seguridadglobaleye.com.ve www.seguridadglobaleye.com

Venezuela

NA

Note: The published figures are obtained from information from the D&B Hoovers Platform (Data from 2021 and 2022). It should be noted that the position is given from highest to lowest income.

The last places are occupied by those who do not have data corresponding to income or sales. The companies that do not have any of the two data are ranked in alphabetical order.

LATIN AMERICA PHYSICAL SECURITY INDUSTRY MARKET STUDY 2023

37

Southern Cone Position

Company

Representative

Info web

Company

Income ($USD)

1

SECURITAS ARGENTINA

Daniel Alberto Pizzi 54 11 401 4 3200

info@securitasargentina.com www.securitasargentina.com

Argentina

$ 76,880,000 (Current)

2

G4S ARGENTINA

Adrian Miranda 54 11 4630 6600

info@ar.g4s.com www.g4s.com/es-ar

Argentina/ Uruguay

$73,880,000 $26,560,000 (Current)

3

PROTECT SECURITY CHILE SPA

NA 56 2 2500 3945

info@protectsecurity.cl www.protectsecurity.cl

Chile

$65,000,000 (Modeling)

4

PROSEGUR

Maximiliano D’ario 54 11 4838 2350

maximiliano.dadario@prosegur.com www.prosegur.com.ar

"Uruguay/ Argentina/ Chile"

$28,540,000 / $8,740,000 / $1,500,000 (Current/ Modeled/ Modeled)

5

MCM SECURITY S.R.L

María Luján Rombolá 54 11 4544-7999

info@mcmsecuritysrl.com.ar www.mcmsecuritysrl.com

Argentina

$15,640,000 (Modeling)

6

ALBIERO SEGURIDAD

Óscar Albiero 54 0387 4218800

oscaralbiero@albieroseguridad.com.ar www.albieroseguridad.com.ar

Argentina

$14,190,000 (Modeling)

7

ARGENTINA SEGURIDAD INTEGRAL

Carlos Aldecoa 54 261 431 9890

carlos@aldecoa.com.ar www.argentinaseguridad.com.ar

Argentina

$13,450,000 (Modeling)

8

PPI CHILE

Francisco Fontecilla 56 2 2519 0200

ppichile@ppichile.cl www.ppichile.cl

Chile

$13,390,000 (Modeling)

9

A TIEMPO SEGURIDAD S.R.L.

Walter Guerra 54 0387 155 600 8080

NA www.atiemposeguridad.com.ar

Argentina

$12,720,000 (Modeling)

10

MEDINILLA SEGURIDAD

Ariel Medinilla 54 0223 476 1222

rrhh@medinillaseguridad.com.ar www.medinillaseguridad.com.ar

Argentina

$9,970,000 (Modeling)

38

Southern Cone Position

Company

Representative

Info web

Company

Income ($USD)

Chile

$8,730,000 (Modeling)

11

MOWART

Cristian Andrés González 56 9 5000 8984

contacto@mowartchile.cl www.mowartchile.cl

12

SOLUTION SEGURIDAD

NA 54 02320 488700

ventas@solutionseguridad.com.ar www.solutionseguridad.com.ar

Argentina

$8,270,000 (Modeling)

13

LATIN SECURITIES S.A. AGENTE DE VALORES

Mateo Piacenza 54 9 11 2164-8668

ventas@latinsec.com www.latinsec.com

Argentina

$2,230,000 (Modeling)

14

SEGURIDAD HUAL-CON S.R.L.

Hugo M. Guerrero 54 46342147

NA www.seguridadhualcon.com.ar

Argentina

$1,720,000 (Modeling)

15

ALRM GRUPO CHILE

Arturo Contreras NA

ventas@glgroup.cl www.alrmgroup.cl

Chile

$1,030,000 (Modeling)

16

ALLIANCE PROTECT

Paola Carpintero NA

hablemos@allianceprotect.com www.allianceprotect.com

Argentina

NA

17

BRUJULA S.P.A

NA 562 2 929 49 20

contacto@brujula-sa.com www.brujula-sa.com

Chile/ Uruguay

NA

18

SEGURIDAD URUGUAY

NA 598 2401 4423

administracion@seguridaduruguay.com.uy www.seguridaduruguay.com.uy

Uruguay

NA

19

SIESCA

NA 59 8 29162596

info@siesca.com.uy www.siesca.com.uy

Uruguay

NA

20

VIEW CAM

Michelle Paulina Zurita 56 223243474

contacto@viewcam.cl www.viewcam.cl

Chile

NA

Note: The published figures are obtained from information from the D&B Hoovers Platform (Data from 2021 and 2022). It should be noted that the position is given from highest to lowest income.

The last places are occupied by those who do not have data corresponding to income or sales. The companies that do not have any of the two data are ranked in alphabetical order.

LATIN AMERICA PHYSICAL SECURITY INDUSTRY MARKET STUDY 2023

39

CHAPTER 4 40

LATIN AMERICA PHYSICAL SECURITY GROWTH

Physical security has played a fundamental role, providing identification and analysis of threats and risks that may arise in facilities, assets and processes, which has generated a wide and varied range of economic activities, both in the governmental sphere and in the business. This aims to protect personal and organizational assets, on which growth and development depend.

In relation to the impact that physical security has on the economic growth of a region, it is important to contextualize the social transformation that has been perceived as a result of external factors and political decisions, which have generated higher rates of violence and greater violence in some countries. Therefore, this triggers the need to evaluate the different public policies and the different models implemented.

Currently, in Latin America, there has been a greater social vulnerability as a consequence of the pandemic produced by COVID-19. Faced with this pa-

norama, it is exposed that in the physical security industry, the most important thing is prevention. According to analysts, they propose taking preventive measures in order to be able to anticipate threats, in addition to increasing the reaction capacity of the human talent involved in an effective and efficient manner.

According to various market investigations, “vendors in the physical security market worked remotely to provide the best services to their customers.

Some market players remained to help their clients during the crisis, regardless of the pandemic.”

In turn, it has been justified that a large part of the companies made changes after the arrival of COVID. Different companies in the sector stated that “end users have been assisted by companies.” To which they added: “This strengthens remote labor and generates flexibility in the use and incorporation of Information Technology and network protection.”

LATIN AMERICA PHYSICAL SECURITY INDUSTRY MARKET STUDY 2023

41

Industry Economic Data Physical Security Information Management Global Market 2020 ($USD)

2024 ($USD)

2026 ($USD)

25,000,000

20,000,000

15,000,000

10,000,000

5,000,000

0

15.19 % Compound annual growth rate Source: Latin Market Research with official data.

Globally, the private security industry has been growing. In 2019, revenues totaled $220,000 and Latin America generated 6% of these revenues.

Additionally, the global physical security information management market was valued at USD $8 million in 2020, and is expected to reach USD $21 million by 2026, registering a compound annual growth rate (CAGR) of 15.93%, over the period 2021-2026.

As stated by the Universidad del Atlántico in the “Economic Analysis of the Sector”, “the global private surveillance and security market that currently predominates in North America with a 38% share, followed by Asia Pacific, the Middle East and Africa with a 16% and Latin America and Eastern Europe

42

with 7% offer services of security guards, supervisors, escorts, operators of technological means and canine handlers.”

In turn, the projections of the Freedonia Group show that “global income from security services will grow by 3.6% (annual) until 2024, the year in which it will reach USD $263,000. Regarding the type of service, private security with a guard will represent 53% in 2024, followed by alarm monitoring and transportation of valuables.”

The building security segment contributes the largest market share of around 40%, followed by perimeter security and data room security in Latin America.

Private security market by country

Mexico Physical security in this country produces more than fifteen billion dollars. Various investigations argue that “there are at least five thousand private security companies in the country, of which only around 10% are registered with the Federal Public Security Secretariat. In turn, the industry provides employment for 180,000 people (18% of the total). And it is prepared to assume the demand of the country’s companies”.

According to the Mexican Association of Private Security Companies (Amesp), “70% will make more investments in technology in 2022 that include security issues.”

It is worth noting that the private security business sector in Mexico has continued to grow between 3 and 4% per year. While the country as a whole grows at 2.3% and approximately contributes 2% of GDP.

Additionally, 80% of companies invest between 5 and 8% of their operating expenses to protect personnel and protect merchandise or information. On the other hand, it should be noted that the increase in the hiring of private security in Mexico was due to the increase (2.4%) in crimes related to firearms and explosives.

According to a security report issued by Mexican authorities, “common criminal incidents, such as vehicle theft and home robbery, registered a drop of 3.2% and 5.9% respectively.”

In turn, the study by the Mexican Chamber of Commerce (CANACO), “Security in Commerce”, revealed that “during the first quarter of 2022, 21.1% of the merchants interviewed were victims of at least one illicit transaction. This represented a 2.6% increase in cases compared to the previous quarter.”

Market of physical security companies registered with the Ministry of Federal Public Security in Mexico 100% 80%

80%

70%

60% 40% 20%

5% 4%

2%

0%

Revenue: USD $15,000 million % in technological investment % of operating expenses (personnel and merchandise) % of companies that contribute to this expense % contributor to GDP Industry growth (annual)

Source: Latin Market Research with official data.

LATIN AMERICA PHYSICAL SECURITY INDUSTRY MARKET STUDY 2023

43

El Salvador In terms of employability, between 2018 and February 2021, it has been documented according to official sources that during this period 213 new private security agents were registered, of whom 203 were men and 10 women. “The year with the most new registrations was in 2018, with 133 people registered. The age ranges of the staff are between 30 and 44 years old,” Foro de Seguridad evidenced through its analysis.

Given the difficult economic situation and despite the fact that an age is legally established to be able to retire, some companies hire older people for security work. In 2018, 8 people with this age were

registered and 7 in 2020.

According to the Chamber of Commerce and Industry of El Salvador “in terms of perceptions on the issue of security, almost 80% of businessmen think that insecurity in the country remains (50.4%), or that it has even worsened (29.4%), compared to previous years.”

Almost 60% reported having suffered in a private way, in their business, or by one of their collaborators, some mishap related to security. The most common mishaps were robbery and theft (61%), and extortion (23%).

Number of new private security companies Registered between 2018 - February 2021 City

Quantity/year 2018

2019

2020

2021

San Salvador

8

13

11

1

San Miguel

1

1

La Libertad

3

1

Cuscatlan

1 1

La Paz

1

Sonsonate

2 7

11

1

2 1

1 13

33

1

Santa Ana

Total

Total

17

20

1 1

51

Source: Own construction with information provided by the PNC.

44

Panama Panama reported an 11% increase (approximately) in homicides for the year 2021, compared to 2020, and 15% with 2019 as a reference.

In relation, the country presented 554 murders in 2021, 54 more than in 2020, it ranks 151, in terms of

intentional homicide rate (or intentional per hundred thousand inhabitants).

The demand for private security services and the supply increase due to the high level of insecurity, as is the case with homicides.

Percentage growth in homicides 15%

11%

4%

2020

2021

difference decrease

Source: Latin Market Research with official data.

LATIN AMERICA PHYSICAL SECURITY INDUSTRY MARKET STUDY 2023

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Dominican Republic According to Foro de Seguridad, “the situation of insecurity in the Dominican Republic allows surveillance and private security companies to receive more and more service requests, according to Pedro A. Benoit, former president of the Dominican Association of Security Companies (ADESINC).”

In relation to said information, citizens not only require personal and institutional protection services, but also the installation of surveillance cameras and alarm systems.

In recent years it has been shown that the member companies of ADESINC contribute to the country with around 82 million hours of annual surveillance, payments of USD $533 million annually in taxes, USD $846 million to social security and USD $55 million to

the Institution of Higher Education (INFOTEP).

However, informality is 63% in the sector. The competitiveness and quality of the private security services provided are closely linked to the reduction of informality in the sector. Sustained economic growth for decades has allowed private security to grow as well.

However, due to regulatory distortions, informal security has prevailed over formal security, generating insecurity and loss of value from this space.

Regarding insecurity rates, the Dominican Republic is the fifth country in the region with the lowest levels of homicides, achieving a rate of 11.1 per 100,000 inhabitants, which places it in a position well below the regional average of 20.4 homicides per 100,000 inhabitants.

Spending and investment of private security companies in Dominican Republic 900,000,000

846,000,000

800,000,000 700,000,000 600,000,000 500,000,000

533,000,000

400,000,000 300,000,000 200,000,000 100,000,000

55,000,000

0 Payments in taxes (USD)

Social security payments (USD)

Investment in higher education (USD)

Source: Latin Market Research with official data.

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Guatemala By 2021, more than 41,000 people were reported as part of the workforce of private security companies (ESP), of which 93% are operational personnel, 6% administrative, and the remaining 1% technical. As presented by the Institute of Education for Sustainable Development in its report “PRIVATE SECURITY and FIREARMS a permanent alert” “the majority of personnel are agents, the offer of private security has expanded in such a way that a series of professionals from various specialties provide their services in these companies.”

Likewise, the records of the Division of Private Security Companies, an entity of the National Civil Police that previously supervised Private Security Companies, in 40 years, from 1970 to 2010, authorized around 140 PRIVATE SECURITY COMPANIES. As of January 28, 2022, the General Directorate of Private Security Services reports 241 authorized

companies, that is, in 10 years, 101 more companies were authorized. The growth of this business turn is marked from the signing of the peace agreements and in the offer of these services there are companies that have thousands of agents at their service and others that have less than 100.

According to the second generation think tank (Diálogos) “Police records indicate that during 2021 there were at least 2,843 homicides throughout the territory of the Republic of Guatemala.

This is an increase of almost 11% compared to the figure registered in 2020, that is, 274 deaths above the 2,569 victims of the previous year. Once these figures were adjusted for the size of the population, the rate went from 15.2 to 16.6 homicides per 100,000 inhabitants”. This is a rate increase of 9% (because the population increased 1.5% according to the projections of the National Institute of Statistics, INE).

Personnel linked to private security in Guatemala: 41,000 employees

100% 80% 60% 40% 20% 0% Operational staff (%)

Administrative staff (%)

Technical staff (%)

Source: Latin Market Research with official data.

LATIN AMERICA PHYSICAL SECURITY INDUSTRY MARKET STUDY 2023

47

Honduras The records show records prior to 1999, where the separation of the Public Security Force (one year before from the Armed Forces and its immediate conversion into the National Police, as a civilian entity) facilitated the creation of the Security Services Control Unit.

A significant growth of more than 70% can be observed for the year 2009, which coincides with the Coup d’état in Honduras; then it shows a decline and remains relatively stable until 2017 and 2018, which rises to more than 50%, an action that is consistent with the post-electoral crisis given in those years.

According to 2019 data from the Institute of Economy and Peace, the impact of crime and violence imposes a cost on the Honduran economy equivalent to 13% of GDP. This is likely an underestimate of the true economic cost of crime in Honduras, given that it focuses only on violence and conflict and not on other types of nonviolent crime.

The high levels of crime and insecurity force Honduran companies to use private security to protect their businesses. Due to this, the number of private security personnel employed is high, especially in comparison with the total number of police officers.

Number of private security companies that joined to the authorized list 1999 - 2001 period 100 90

88

87 80

80 70 60

59 51

50

31

30 20

18

10 0

42

41

40

0

18

14 1

3

35

37

41

19

14

12 4

4

5

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Source: Own elaboration with data from (Directorate of control of private security services and other services, 2021

48

Andean region

Colombia The private surveillance sector moves around USD $2 trillion, is made up of some 855 licensed companies and grew 8% in 2020, being one of the fastest growing in the midst of the pandemic, generating around 40,000 new jobs, due to the need to implement the service, proportionally increasing the hiring of personnel. It is an industry that has generated between 380 and 400 thousand direct jobs.

Private security companies have taken advantage of different technological advances to develop comprehensive service offerings, where the customer is provided with an experience that goes far beyond surveillance. Aspects such as data analysis, predictive intelligence and facial recognition are some of those that have allowed the segment to grow exponentially in recent years.

The Superintendence of Surveillance and Private Security explained that “this growth is reflected in the sector’s contribution to the country’s economy, which represents 1.2% of GDP.” In relation to this, it is said that the incentives established by the National Government have strengthened that surveillance companies include people with disabilities or people over 45 years of age in their payrolls. The participation of women in these payrolls has also reported growth.

In Colombia, the sector employs about 376,700 people including security guards, escorts, canine handlers, technological media operators, and supervisors, and its income in 2020 was USD $24 billion.

Private security sector outlook

Annual generation: $10.5 billion ( Local currency)

$

Contribution to Approximate the economy number of 1.2% workers: of GDP 390.000

Growth in surveillance services From 8,000 in 2019, more than

Fines for those who hire illegal surveillance services Between 20 and 40 SMMLV

more than 10,500 in 2022

Surveillance service rates (24 hours/30 days) Commercial sector 8.8 SMMLV

Supervision expenses No weapon 8% With weapon 8%

Residential sector (Estrata 4, 5 and 6) 9.6 SMMLV

Con canino 11% Source: Superintendency of Surveillance and Private Security LATIN AMERICA PHYSICAL SECURITY INDUSTRY MARKET STUDY 2023

49

Ecuador In the country, according to different investigations, it has been shown that insecurity has become a problem for governments that see the demand directed towards them grow, but that it is shown to be inefficient in providing it giving way to the expansion of private security.

In Ecuador, according to data from the Ministry of Government (2019) “the homicide rate went from 5.8 per 100,000 inhabitants in 2018. In 2019, the number of complaints about robberies went from 65,439 to 72 502 accusations for this crime.”

On the other hand, the level of income for companies in the private security sector is given by the average sales for private security companies is USD $778 million, with a growth of 6.16%. Regarding sales for security system companies, revenue for these companies decreased by 3.38% between 2010-2019, their average level of sales was USD $62 million between 2010-2019.

This means that in Ecuador, the preference of people is directed towards services such as bodyguards, armored security transport, etc. in relation to the installation of security systems, such as alarms, cameras, etc.

Sales average of electronic and private security

1,000,000,000 800,000,000

778,000,000

840,000,000

600,000,000 400,000,000 200,000,000

62,000,000

0

Average private security sales (USD) Average electronic security sales (USD) Total revenue for the industry (USD)

Source: Latin Market Research with official data.

50

Peru According to the National Institute of Statistics and Informatics (INEI) “in February 2022, the activities of administrative and support services increased by 1.86%, mainly due to private security activities explained by the hiring of personnel for physical security, transfer and logistics of values, protection of personnel and comprehensive security consulting; In addition, security system services activities grew.”

It is worth noting that the companies formally dedicated to the field, in Peru, move more than USD $400 million a year and more than 1,000 registered security companies participate in it.

However, there are still limitations such as social factors; that is, the crime rate, security threats and perceptions; the lack of new technologies and the little expansion of the private sphere.

Faced with the whole panorama, there is a growing trend in the operation of private security companies, this increase in supply and demand can be explained by the economic growth experienced in the country, which at the same time strengthens the increase in industries and companies, there is an increase in the contracting services of guards or private security guards, in order to protect the value chain, assets and therefore investments.

No graph due to lack of available data

LATIN AMERICA PHYSICAL SECURITY INDUSTRY MARKET STUDY 2023

51

Venezuela In Venezuela, it is said that an escort can make between 300 and 500 dollars a month, very attractive compared to police salaries that for a long time did not reach 30 dollars.

Today, after an increase of 1,700% decreed by the government, a recently graduated officer from the National Police earns the equivalent of 114 dollars.

It is worth noting that in 2021, there were almost 40.9 homicides per 100,000 inhabitants in the country, below a homicide rate of 45.6 the previous year. According to Statista, one of the main sources of economic consultation, “since 2017, when it reached its peak, the homicide rate in Venezuela has been decreasing year after year.”

According to the Venezuelan Violence Observatory (OVV) “the year 2021 was representing an inflection in the behavior of crime and violence as a result of changes in the local economy, the dollarization process and the generalization of remittances by family members to migrants. This process, through which there has been a small commercial reactivation and a slight recovery of the economy, which, although very precarious due to its small size and the level of setback from which it starts, opens up new opportunities for crime.”

That year, for example, there were 10% increases in the number of thefts, 13% in vehicle theft, and 18% in vehicle theft known to the police.

Income comparison between police officers and private security guards

400 50 300

300

250 186

200 150

114

100 50 0 Security guard income (USD)

Police income (USD)

Difference in income (USD)

Source: Latin Market Research with official data.

52

Southern Cone

Argentina Like many other sectors of the economy, private security also has a lot of informality; “although at the same time it is one of the main labor demanders with these estimated numbers: 350,000 workers nationwide, of which 150,000 work in the Province of Buenos Aires, although only 25,000 are registered.

In fact , companies such as Securitas Argentina and Prosegur usually appear in the rankings of the largest contracting companies with more than 10,000 employees each” states the article “Private Security: business and union dispersion affect an industry that could have much more registered work.”

This flow of personnel had an explosion of growth during the pandemic: the employees of many businesses that closed found employment refuge in pri-

vate security, a migration that today runs in reverse due to the return to normality and the reopening of businesses. In CABA, the starting salary for a security guard is USD $452 for 208 hours per month.

In Argentina, the majority of workers in the sector are men and the predominant age range is from 30 to 50 years.

According to Mundo Gremial, “the three main players in the sector, which account for 80% of the market, are Securitas with a monthly turnover of around USD $77,000, employing some 10,500 people; followed by Prosegur, which invoices USD $54,000 and has a payroll of 8,900 workers. Complete G4 with USD $25,000 and 3,500 employees.”

Number of private security employees in Argentina

400,000 300,000 200,000 100,000 0 Level employees national

Employees in the Buenos Aires Province

Employees registered

Source: Latin Market Research with official data.

LATIN AMERICA PHYSICAL SECURITY INDUSTRY MARKET STUDY 2023

53

Chile Currently, Private Security is governed by Law No. 3,607 (1981), whose Regulations were published in the Official Gazette on July 31, 2020.

Given the growing interest in protection systems, between 2020 and 2022, the security industry in Chile posted a net annual growth of more than 8%. For its part, the company that has a presence in 14 of the

16 regions of the national territory registered a net increase of 24% annually.

It is worth noting that in the last six years homicide rates in Chile increased by 70%, while the perception of damage caused by violent robbery rose by 37% in a decade.

It does not have a graph due to data availability.

54

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55

CHAPTER 5

FREIGHT AND CARGO PRICES

56

FREIGHT AND CARGO MOVED ON DIFFERENT ROUTES FROM LATIN AMERICA From

07-10-2016

to

07-10-2016

$10.000 $7.500 $5.000 $2.500 $0 01-Jan-17

01-Jan-18

01-Jan-19

01-Jan-20

01-Jan-21

01-Jan-22

Source: Freight Baltic Index (FBX).

Note: Price growth (in USD) for the last 5 years.

Rising product prices, shortages of raw materials and high container shipping costs are other concerns for industry integrators in terms of distribution and logistics. In addition, it is possible that the supply of some integrated systems, equipment, among others, may decrease. In relation to this, if there is an increase in demand in this scenario, the price increase would be much higher.

Alessandro Nicita, economist at the UN trade agency (Unctad), explains that the strong recovery of exports in the world is what is generating a real shock: “If trade were depressed, there would be no crisis.”

Before the pandemic, shipping a container from Asia to Latin America and vice versa cost an average of $2,000 USD and sometimes as much as $1,500 USD. By 2021, it was hardly feasible to get sea freight on that route for less than $8,000 USD. The Asia-Europe corridor, on the other hand, by that time was fetching rates in excess of $10,000 USD and up to $14,000 USD for a single voyage.

In 2022, fares have started to decrease at the international level. It is noteworthy that in May 2022 it was above $8,000 USD, since that month it has been decreasing month by month. By October 2022, pressure had dropped by more than 50%, showing a price of $3,540 USD.

LATIN AMERICA PHYSICAL SECURITY INDUSTRY MARKET STUDY 2023

57

From

22-10-2021

To

14-10-2022 $10.000

$7.500

$5.000

$2.500 01-Nov-21

01-Jan-22

Fuente: Freight Baltic Index (FBX).

01-Mar-22

01-May-22

01-Jul-22

01-Sep-22

Nota: El aumento de los precios (anual: noviembre 2021 a septiembre 2022) evidenciados en la gráfica están relacionados con el Índice Global de carga de contenedores (valores en USD).

From another point, according to figures from Drewry, a global logistics research and consulting firm, in the last week of September 2022 the freight rate for a 40-foot container fell to $4,014 USD.

Supply chains will be affected by the rising costs of maritime trade. Low value-added goods produced in smaller economies, in particular, could suffer a serious erosion of their comparative advantages.

The above represented a 61% decrease in the last year, when compared to September 2021 when the value for freight in that same container was at $10,377 USD.

A 10 % increase in container freight rates, coupled with supply chain disruptions, is expected to decrease industrial output in the United States and the euro area by more than 1 %, while in China output is expected to decline by 0.2 %.

Likewise, the average composite rate for the year to date is $7,597 USD per 40-foot container, which is $3,884 USD higher than the five-year average ($3,714 USD).

Rising and falling freight rates the uncertainty of economic recovery

The United Nations Conference on Trade and Development (UNCTAD) warned that “global consumer prices will increase significantly in 2023 until supply chain disruptions, port constraints and port terminal deficiencies are resolved.”

The impact of higher freight rates will be greatest in Small Island Developing States (SIDS), which could see import prices rise by 24% and consumer prices by 7.5%. In the Least Developed Countries (LDCs), consumer price levels could increase by 2.2%.

58

What is forecast

The UN agency stresses that the increase in goods exports was mainly due to higher commodity prices, especially for minerals, hydrocarbons and agro-industrial products, rather than to an increase in the volume exported.

It also indicates that regional exports of services continue to fail to recover from the drop they suffered due to the coronavirus pandemic.

“In particular, regional dependence on tourism far exceeds the world average, so the uncertainty about the reopening of this sector negatively conditions the prospects of several economies, especially in the Caribbean,” warns the Economic Commission for Latin America and the Caribbean (ECLAC). “In sum, the recovery of regional trade in 2021 shows important weaknesses.”

In relation to this last point, the agency calculates that the global average cost of container freight by sea has risen by more than 660 % from June 2019 to date.

On the other hand, the value of regional imports of goods would register an increase of 32 % with an expansion of 20 % in volume and 12 % in prices.

Looking ahead to 2022 forecasts, the agency projects growth in the value of regional exports and imports of 10 % and 9 %, respectively.

The highest trade activity was recorded with China and at the regional level. The projected annual variation in regional exports to the Asian country is 35%, followed by 33% inter-regional, and a growth in ship-ments of 23% to the European Union and 19% to the United States.

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59

CHAPTER 6

LATIN AMERICAN ECONOMIES RECOVERED GRADUALLY Economic analysis with data and update through January 2023

60

Latin America and the Caribbean (33 countries): GDP growth rate projection, 2022 (Percentages) Guyanese

46,0

St. Lucia

15,8

Caribbean

11,0 8,5

Bahamas Barbados Panama

7,5 7,3

Belize The Caribbean (excl. Guyana)

6,2 6,1 5,7 5,7

Trinidad and Tobago Jamaica Dominican Rep Dominica

5,5 4,6 4,6

Central America Honduras Guatemala Antigua and Barbuda

4,5 4,3 4,2 4,0 3,9

Grenade Saint Kitts and Nevis El Salvador

3,8

Paraguay

3,8 3,7

St. Vincent and the Grenadines Costa Rica Colombia

3,7 3,7 3,5 3,3

Cuba Central America and Mexico Bolivia (Plur. State of) Uruguay

3,2 3,1

Nicaragua Venezuela (Bol. Rep. of) Peru

3,0 3,0 3,0 2,9 2,6 2,2

Mexico Ecuador Argentina

2,1

Latin America and the Caribbean Latin America

2,0 1,9

Chile Suriname South America

1,5 1,4

Haiti Brazil

1,4 0,5 0

5

10

15

20

25

Source: Economic Commission for Latin America and the Caribbean (ECLAC) on the basis of official figures.

MARKET STUDY LATIN FOR AMERICA THE PHYSICAL PHYSICAL SECURITY SECURITY INDUSTRY INDUSTRY IN MARKET LATIN AMERICA STUDY 2023

61

In 2022, following the contraction of world GDP in 2020 as a result of a generalized fall in economic activity in both developed and emerging economies, the effects of the war between Russia and Ukraine, the rise in prices and the impact on trade chains in Europe, will also be reflected in some Latin American countries.

Likewise, the crisis has triggered a contraction in international trade and, in turn, has led to sharp fluctuations in (high) prices as a result of volatility in the financial markets, which has translated into lower profitability and greater risk aversion.

In addition, the measures taken in the vast majority of countries around the world to contain the pandemic have had a significant impact on tourism and commercial aviation activities and restaurant and hotel services.

However, such measures implemented by some of the governments of Latin American countries to deal with the effects of the pandemic have helped to mitigate the economic impact on the social and business fabric of the region. The case of the fiscal monetary packages, for amounts close to USD 12 trillion in fiscal actions and USD 7.5 trillion in monetary action announcements, have cushioned the fall in economic activity, but this has also led to high levels of liquidity, which has had repercussions in the increase of indebtedness at a global level.

These disparities and asymmetries affect not only the dynamics of short-term growth, but also the capacity to sustain medium-term growth. According to International Monetary Fund (IMF) estimates, “the group of advanced economies is the only one that in 2022 would resume the growth trajectory registered

62

before the pandemic, and even surpass it. The other groups of countries will remain, in the medium term (until 2025), on a much lower growth trajectory than projected before the pandemic”.

It is worth noting that during 2021, commodity prices continued the upward trend that began in May 2020, and are estimated to have grown by 42% over the 2020 average level. In 2022, prices are expected to remain high, although a slight decline (-3.2 %) compared to 2021 would be observed.

For the global economy, 2022 starts in weaker conditions as a result of higher energy prices and supply disruptions, inflation is higher and more widespread than expected, especially in the United States and in many emerging markets and developing economies.

In addition, the ongoing contraction in China’s real estate sector and the unexpectedly slow recovery in private consumption have limited growth prospects.

Volatility in financial markets

International financial markets performed favorably in 2021, despite some brief episodes of increased volatilities linked not only to the evolution of the pandemic, but also to uncertainty about the inflation outlook and the possibility of early withdrawals of monetary stimulus. This has increased the likelihood that central banks in developed economies will reduce their monetary stimulus, which may have adverse effects on emerging markets.

The lower exchange rate corrections recorded in 2021 were also accompanied by lower volatility in the exchange rate, relative to the average absolute value of inter-daily exchange rate variations during the first three quarters of the year.

Volatility index in financial markets (January 2018- October 2021) VIX, V2X and VXEEM indices of financial volatility, January 2018 to October 2021 70 60 50 40 30 20

2018

2019

2020

VXEEM Index VIX index EURO STOXX V2X Index

Oct

Jul

Apr

Jan

Oct

Jul

Apr

Jan

Oct

Jul

Apr

Jan

Oct

Jul

Apr

0

Jan

10

2021

Source: Economic Commission for Latin America and the Caribbean (ECLAC), based on Bloomberg.

Note: The VIX index, compiled by the Chicago Board of Options (CBOE), measures the expected volatility for the next 30 days based on the prices of the call and put options of the S&P 500 index. CBOE also produces the VXEEM index, which measures volatility in emerging markets, and Deutsche Börse, together with Goldman Sachsa, produces the V”X index, which measures volatility in the euro zone.

Impact on trade and value chains In line with global GDP growth dynamics, the volume of world trade in goods would also grow less in 2022 (by 4.7 %, compared to a figure of almost 11 % in 2021), according to estimates from the outlook for Latin American and Caribbean countries, the region’s

exports grew by 25 % in value in 2021, with a 17 % increase in export prices and an 8 % increase in the volume exported. Meanwhile, imports would have grown by 32% in value, representing the largest increase since 2010, when they expanded by the same amount.

North America CIS b Asia

South America parts Africa

Europcar Middle East

North America CIS b Asia

South America parts Africa

2022T4

2022T3

2022T2

2022T1

2021T4

2021T3

2021T2

2021T1

2020T4

2020T3

2020T2

2020T1

70

2019T4

70

2019T3

75 2022T4

75 2022T3

80

2022T2

85

80

2022T1

85

2021T4

90

2021T3

90

2021T2

95

2021T1

100

95

2020T4

100

2020T3

105

2020T2

105

2020T1

110

2019T4

115

110

2019T3

115

2019T2

120

2019T1

120

2019T2

Imports

2019T1

Exports

Europcar Middle East

Note: a. Comprises Central and South America and the Caribbean. B. Comprises the Commonwealth of Independent States (CIS), including certain former member states and associate member states.

Fuente: WTO and UNCTAD. LATIN AMERICA PHYSICAL SECURITY INDUSTRY MARKET STUDY 2023

63

After the collapse of 2020, it is estimated that import volumes grew by 20%, in line with the expansion of domestic activity in the region, both consumption and investment, and that import prices rose by 12%.

Although the favorable evolution of commodity prices in 2021 translated into an estimated increase in the terms of trade of around 5% in the region, there are differences at the subregional level.

Notably, the terms of trade fell by 5% in the Caribbean (excluding Guyana, Jamaica and Trinidad and Tobago) and by 1% in Central America, partly as a result of the large weight of energy in the import basket of these countries. According to the Economic Commission for Latin America and the Caribbean, “the group of countries whose terms of trade increased the most is precisely that of hydrocarbon exporters (15%). Remittances continue on an upward trajectory and, after having increased by 8% in 2020, they would have increased by almost 30% in 2021”.

According to ECLAC, “they continue to be a very important source of external resources for the countries of the region, particularly for Central America,

Mexico and some Caribbean countries. The services balance deficit worsened in 2021, influenced mainly by a deterioration in the transport and other services account, whose imports increased in line with the rise in goods imports”.

The World Trade Organization (WTO) forecasts world merchandise trade volume growth of 10.8% in 2021, up from 8.0% forecast in March, followed by a 4.7% increase in 2022. Supply-side challenges, such as semiconductor shortages and port delays, affect in certain areas, but are unlikely to have a material impact on global aggregates. The greatest downside risks come from the pandemic itself Against this, Director-General Ngozi Okonjo-Iweala argued, “Trade has been an essential tool in combating the pandemic, and this strong growth underscores the importance of trade in underpinning global economic recovery.”

The high annual growth rate of merchandise trade volume recorded in 2021 primarily reflects the sudden drop in the previous year, which bottomed out in the second quarter of 2020. Starting from a low point,

World merchandise trade volume, 2015Q1- 2022Q4 Index, 2015=100 125 120 115 110 105 100 95

Forecast Trend 2011-2019

Current forecast

Previous forecast

2022Q4

2022Q3

2022Q2

2022Q1

2021Q4

2021Q3

2021Q2

2021Q1

2020Q4

2020Q3

2020Q2

2020Q1

2019Q4

2019Q3

2019Q2

2019Q1

Merchandise trade volume Current

Source: WTO and UNCTAD for trade volume data; WTO for forecasts.

64

2018Q4

2018Q3

2018Q2

2018Q1

2017Q4

2017Q3

2017Q2

2017Q1

2016Q4

2016Q3

2016Q2

2016Q1

2015Q4

2015Q3

2015Q2

2015Q1

90

year-on-year growth in the second quarter of 2021 was 22.0 %, but the figure is forecast to fall to 10.9 % in the third quarter and 6.6 % in the fourth quarter, due in part to the rapid recovery of trade in the last two quarters of 2020. Only 0.8 % quarter-on-quarter growth averaging 0.8 % each quarter in the second half of this year, equivalent to an annualized rate of 3.1 %, is needed to meet the forecast for 2021.

Indeed, debt issuance in the international markets by the region continued to rise and, in the first ten months of 2021, increased by 12.3 % compared to the same period in 2020, although this time with greater prominence of private debt and lower growth in sovereign issuance. Non-bank private sector issuance grew by 77 %, while sovereign issuance increased by 14 %, after experiencing strong dynamism in 2020.

Trade volume growth is expected to be accompanied by market-weighted GDP growth of 5.3% in 2021 and 4.1% in 2022 (instead of the 5.1% and 3.8% previously forecast).

The recovery in financial flows has, however, been accompanied by a deterioration in credit ratings in several countries in the region, with 12 credit rating downgrade actions in 2021, in addition to downward outlook revisions for almost all countries in the region, as well as a slight increase in sovereign risk, which even so still remains well below the figures recorded during much of 2018 and 2019.

Balance of financial flows to the region

The income balance deficit, on the other hand, increased in 2021 mainly due to higher profit remittance by foreign investment companies, in a context of rising commodity prices. As a result of the aforementioned trends, after exhibiting a small surplus in 2020 (0.2 % of GDP), the current account of the balance of payments turned into a deficit again in 2021 and stood at 0.6 % of GDP.

Growth dynamics in 2021 were led by domestic demand. Private consumption was a key driver and contributed around half of second-quarter growth.

On the other hand, although exports grew significantly, the net external sector (exports minus imports)

Cumulative 12-month net portfolio capital flows to emerging markets and financial volatility in emerging markets, March 2011 to September 2021 (In millions of dollars)

2011

2012

2013

2014

2015

2016

2017

2019

2020

Sep

Mar

Sep

Mar

Sep

Sep

2018

Mar

Mar

Sep

0

Mar

-100

Sep

10

Mar

-50

Sep

20

Mar

0

Sep

30

Mar

50

Sep

40

Mar

100

Sep

50

Mar

150

Sep

60

Mar

200

Portfolio capital flows Financial volatility index in emerging markets

2021

Source: Economic Commission for Latin America and the Caribbean (ECLAC), on the basis of information from the International Monetary Fund (IMF), 2021 and Bloomberg LATIN AMERICA PHYSICAL SECURITY INDUSTRY MARKET STUDY 2023

65

presents a negative contribution to output growth, due to the sharp increase in imports.”

According to ECLAC, “from a sectoral perspective, the expansion of economic activity was led by the recovery of the sectors of economic activity most affected by the pandemic (construction, commerce, manufacturing, and transport and communications), all of which showed a generalized increase. The rest of the sectors of economic activity also recorded recoveries during the second quarter”.

GDP evolution in Latin America

In this context, the projected growth of the world economy for 2021 was 5.8 % and, for 2022, a slowdown to 4.9 % is expected. In the cases of the United States and China, substantially lower growth rates are expected in 2022 than those observed in 2021.

According to the Economic Commission for Latin America and the Caribbean, “the group of developed economies would have grown by 5.2% in 2021.

The United States is estimated to have grown by 6.0% and the euro zone by 5.2%, while Japan is estimated to have grown by 2.4% and the United Kingdom by around 6.8%. In the group of emerging and developing economies estimated to have grown by 6.4 % this year, China, with a growth of 8.0 %, and India, with 9.5 % stand out”.

From another point, and in a less optimistic scenario, the negative developments since the release of

66

the October 2021 WEO report mean that the world economy is starting the year in weaker conditions than expected.

Supply disruptions continued during the fourth quarter, sowing obstacles for international manufacturing, particularly in the United States and Europe. A resurgence of COVID cases (particularly in Europe) also hinders a broader recovery. In China, disruptions caused by COVID outbreaks, disruptions to industrial production caused by power outages, falling real estate investment and the unanticipated acceleration of public investment retrenchment contributed to a cooling of the economy in the second half of the year.

In sectoral terms, ECLAC states that although the current economic situation has had a negative impact on all sectors, it has done so with varying intensity depending on the sector. The most affected were manufacturing, construction, commerce and transportation, and the least affected were agriculture, essential services, financial services and mining.

The analysis presented by ECLAC at the country level indicates that Chile and Brazil are the most indebted economies in the region (263% and 229% of GDP for the third quarter of 2020, respectively).

This is why liquidity expansion policies have succeeded in lowering the cost of financing for the nonfinancial corporate sector. The interest rate spread for the corporate sector has narrowed substantially since the beginning of the pandemic for high yield and investment grade bonds.

Selected regions and countries GDP growth rate for 2020 and projections for 2021 and 2022 (In percentages)

13 6,8 5,8

4,9

5,2

6,0 4,2

3,9

3

5,0 2,4 3,0

5,2 4,6

-2 3,1 -7

-3,4

6,4

5,1

5,7

-2,1

7,9 5,9 3,8

2,3

-0,8

-2,0

4,1 4,1

-2,8

3,7 3,8

-1,7

-4,7 -6,3

-7,3 Sub-saharan Africa

2022

Middle East and North Africa

Emerging and developing countries in Asia

2021

Emerging and developing countries in Europe

Emerging and developing economies

2020

India

Euro zone

United Kingdom

Japan

United States

Advanced economies

-9,7 World

-12

-4,5

6,4

9,5

8,0

7,2

China

8

Source: Economic Commission for Latin America and the Caribbean (ECLAC), on the basis of Organization for Economic Cooperation and Development (OECD), OECD Economic Outlook, Interim Report, Keeping the Recovery on Track, September 2021; International Monetary Fund (IMF), World Economic Outlook (WEO), October 2021; European Central Bank (ECB), “Eurosystem staff macroeconomic projections”, September 2021 and Capital Economics. a Figures for India are for the fiscal year, beginning in April and ending in March of the following year.

MARKET STUDY LATIN FOR AMERICA THE PHYSICAL PHYSICAL SECURITY SECURITY INDUSTRY INDUSTRY IN MARKET LATIN AMERICA STUDY 2023

67

World Economic Outlook Update, January 2022 growth projections

World economy

5,9

2021

4,4

2022

Advanced economies

3,8

2023

5,0

2021

Emerging market and developing economies

6,5 3,9

2022

4,8

4,7

2022

2023

2,6

2023

2021

Source: International Monetary Fund

Future perspectives From another perspective, the growth projections for the economies of Latin America and the Caribbean in 2021 are positive (subject to changes due to the current situation). An average regional growth rate of 3.7% is estimated. In fact, 3.1 points of the projected growth rate for the region in 2021 correspond to statistical carryover, which means that 3.7% would make it possible to recover 44% of the GDP loss recorded in 2020.

of 1.8%. In this scenario, recovery to the 2019 GDP level would be reached in 2024.

In the Economic Survey of Latin America and the Caribbean, 2020, ECLAC projected a scenario in which the region picks up in 2021 and then returns to its average growth trajectory of the last decade

The forecast is based on poor health indicators falling to low levels in most countries by the end of 2022, assuming immunization rates will improve internationally and more effective therapies will emerge.

68

From another angle, the International Monetary Fund expects global growth to moderate from 5.9% in 2021 to 4.4% in 2022; that is, half a percentage point lower in 2022 than forecast in the October edition of the WEO report, largely due to the cut in the projections of the two largest economies.

ESTIMATES 2020-2021 AND PROJECTIONS 2022 - 2023 Estimates

Projections

Difference with Update of the WEO report of October 2021 1/ 2022 2023 -0.5 0.2 -0.6 0.4 -1.2 0.4 -0.4 0.5 -0.8 0.9 -0.4 0.0 -0.4 0.6 -0.6 1.2 0.1 0.4 -0.3 0.4 -0.8 0.2 -0.1 0.0

2021 5.9 5.0 5.6 5.2 2.7 6.7 6.2 4.9 1.6 7.2 4.7 4.7

2022 4.4 3.9 4.0 3.9 3.8 3.5 3.8 5.8 3.3 4.7 4.1 3.6

2023 3.8 2.6 2.6 2.5 2.5 1.8 2.2 3.8 1.8 2.3 2.8 2.9

-2.0

6.5

4.8

4.7

-0.3

-0.9 -7.3 -3.4

7.2 9.0 3.1

5.9 9.0 5.6

5.8 7.1 6.0

-1.8

6.5

3.5

-2.7 -6.9 -3.9 -8.2 -2.8 -4.1 -1.7 -1.8 -6.4

4.5 6.8 4.7 5.3 4.2 2.9 4.0 3.0 4.6

-3.5

Projections

2021 4.2 4.4 5.3 4.8 1.9 5.0 6.2 4.9 0.4 6.3 3.5 3.8

2022 3.9 3.5 3.5 3.2 4.2 1.9 2.5 5.0 3.6 3.8 3.9 3.4

2023 3.4 1.8 2.0 1.8 1.6 1.7 1.7 2.5 1.1 0.5 1.9 2.5

0.1

4.0

4.3

4.8

-0.4 0.5 -0.2

0.1 0.5 0.0

3.7 4.3 3.5

5.4 5.8 5.6

5.7 7.5 5.9

2.9

-0.1

0.0

5.8

2.2

3.0

2.8 2.4 0.3 2.8 4.3 4.8 3.7 2.7 1.9

2.1 2.6 1.6 2.7 3.6 2.8 4.0 2.7 1.4

-0.1 -0.6 -1.2 -1.2 0.2 0.0 -0.1 0.0 -0.3

0.1 0.1 -0.4 0.5 -0.2 0.0 -0.1 0.1 0.0

4.2 3.7 0.6 2.9 ...

5.2 ...

2.4 1.3

2.1 1.8 1.5 3.4 ...

5.3 ...

2.1 2.6

1.8 2.6 1.4 1.9 ...

2.8 ...

2.3 0.9

5.6

4.2

3.4

-0.5

0.3

4.2

3.9

2.8

0.1

3.1

5.3

5.5

0.0

0.0

...

...

...

Volume of world trade (goods and services) 6/

-8.2

9.3

6.0

4.9

-0.7

0.4

...

...

...

Advanced economies advanced economies Emerging market and developing economies Commodity prices (US$ USA.) Petroleum 7/ Non-combustible (average based on world import weights of raw Materials) Consumer prices Advanced Economies

-9.0

8.3

6.2

4.6

-0.7

0.6

...

...

...

-6.7

11.1

5.7

5.4

-0.7

0.0

...

...

...

-32.7

67.3

11.9

-7.8

13.7

-2.8

79.2

-4.7

-6.8

6.7

26.7

3.1

-1.9

4.0

-0.4

17.2

1.5

-1.6

0.7

3.1

3.9

2.1

1.6

0.2

4.8

2.8

2.0

world product Advanced economies USA Euro zone Germany France Italy Spain Japan United Kingdom Canada Other advanced economies 3/ Asian emerging market and developing economies China India 4/ ASEAN-5 5/ Emerging and developing economies of Europe Russia Latin America and the Caribbean Brazil Mexico Middle East and Central Asia Saudi Arabia sub-saharan africa Nigeria South Africa informative items World growth according to market exchange rates Low-income developing countries

2020 -3.1 -4.5 3.4 -6.4 -4.6 -8.0 -8.9 -10.8 -4.5 -9.4 -5.2 -1.9

Estimates

Note: Real effective exchange rates are assumed to remain constant at current levels between December 10, 2021 and January 7, 2022. Economies are listed by size. Aggregate quarterly data is seasonally adjusted. WEO = World Economic Outlook.1/ Difference based on rounded figures in both forecasts in this update and the October 2021 World Economic Outlook. Countries whose forecasts have been revised as of the October 2021 WEO correspond to about 90% of annual global production weighted by purchasing power parity.2/ For global production, quarterly estimates and projections correspond to around 90% of annual world production weighted by purchasing parity.

For emerging market and developing economies, the quarterly estimates and projections correspond to about 80% of the group’s annual output weighted by purchasing power parity.3/ Excludes the Group of Seven (Canada, France, Germany, Italy, Japan, UK, US and US) and euro area countries.4/ For India, data and forecasts are based on fiscal year, with fiscal year 2021/22 as of April 2021.

In the January 2022 WEO Update, India’s growth is projected at 8.7% in 2022 and 6.6% in 2023 on a calendar year intensive basis. The 2021 column of the table includes the impact of the omicron variant. 5/ Philippines, Indonesia, Malaysia, Thailand, Vietnam.6/ Simple average of growth rates of export and import volumes (goods and services).7/ Simple average of U.K. crude oil prices.

Brent, Dubai Fateh and West Texas Intermediate. The average price of oil was USD 69.07 in 2021; the assumed price based on futures markets (as of January 10, 2022) is USD 77.31 in 2022 and USD 71.29 in 2023.8/ The inflation rate for the euro zone is 3.0% in 2022 and 1.7% in 2023, for Japan it is 0.7% in 2022 and 2023, and for the United States it is 5.9% in 2022 and 2.7% in 2023, respectively.9/ Excludes Venezuela.

LATIN AMERICA PHYSICAL SECURITY INDUSTRY MARKET STUDY 2023

69

GDP GROWTH RATE (2020) AND PROJECTIONS (2021-2022) Countries

December 2020

2021 projections %

2022 projections %

Growth Difference (2020-2021)

Growth Difference (2021-2022)

Paraguay

-0.6

4

4

-85

100

Panama

-17.9

2.6

7.8

788.4

66.66

Brazil

-1.2

3.7

6.5

132.4

43.07

Costa Rica

-4.5

2.9

4

-55.17

27.5

Honduras

-9

4.5

5.2

300

13.46

Uruguay

-5.9

2.7

3.1

318.51

12.9

Guatemala

3.6

3.1

3.4

-16.12

8.82

Dominican Republic

-6.7

4.8

4.5

239.583

-6.66

El Salvador

-7

5

4.4

240

-13.63

Bolivia

-6.2

4.4

3.5

-40.9

-25.71

Colombia

6.1

5.1

3

-19.6

-70

Mexico

3.1

5

2.5

38

-100

Chile

3.2

6.2

3

48.38

-106.6

Peru

0.51

8.5

3.9

94

-117.9

Argentina

-9.9

5.8

2.5

270.68

-132

Ecuador

-7.8

8.8

1.3

11.36

-576.9

Source: based on official information from the region’s central banks. Own calculations and graph.

Note: The difference in growth expressed in percentage units is obtained by estimating the current GDP (projection with the previous GDP).

70

Inflation expectations 2021-2022 ECLAC estimated in 2020 that year-on-year (December-December) average inflation in CARD countries stood at 2.3%, 0.4 percentage points below that recorded in 2019 (2.7%). This slowdown was the result of a significant contraction in domestic demand, due to the temporary closure of economic activities.

The August 2020 expectations surveys conducted by the region’s Central Banks indicate that the simple average of growth expectations for 2020 decreased 0.1 percentage points from -5.9 % to -6.0 % and the simple average of inflation expectations increased 0.1 percentage points from 3.1 % to 3.2 % with respect to the July surveys. Changes in both inflation and growth expectations are heterogeneous among the countries analyzed.

In the case of expectations for 2021, the August 2020 surveys indicate that the simple average of growth expectations increased 0.1 percentage points from 3.8 % to 3.9 % and the simple average of inflation decreased 0.1 percentage points from 3.8 % to 3.7 % with respect to the July surveys.

The countries where growth expectations for 2021 increased were Brazil, Mexico, Paraguay and Peru.

In the case of inflation, Brazil, Paraguay and Uruguay recorded a drop in inflation expectations.

High inflation is expected to continue higher than

anticipated in the October edition and supply chain disruptions and high energy prices are expected to persist in 2022. Inflation would remain elevated in the near term, averaging 3.9% in advanced economies and 5.9% in emerging markets in the 2022.

Futures markets indicate that oil prices will rise by about 12% and natural gas prices by about 58% in 2022 (both increases being considerably lower than those seen in 2021), before falling back in 2023 as supply-demand imbalances are further corrected.

Similarly, food prices are projected to advance at a more moderate pace of around 4% in 2022 and reverse in 2023.

In many countries, nominal wage growth remains subdued, even though employment and participation have almost recovered to pre-pandemic levels).

In the United States, however, the situation is different: the dramatic fall in unemployment is accompanied by a vigorous rise in nominal wages. This suggests a degree of saturation of U.S. labor markets not seen elsewhere.

Consequently, in December 2021, the Federal Reserve announced that it would accelerate the gradual tapering of asset purchases and hinted that the federal funds rate would likely rise to 0.75-1.00% by the end of 2022; that is, about 50 basis points higher than previously suggested.

LATIN AMERICA PHYSICAL SECURITY INDUSTRY MARKET STUDY 2023

71

EXPORT GROWTH AND TRADE BALANCE IN MEXICO AND CENTRAL AMERICA 2020 - 2021 % EXPORT GROWTH 2020 - 2021

2,24% -9,04%

-12,05%

-8,55%

Nicaragua

-22,58%

El Salvador

-4,49%

-9,45%

Source: ECLAC

TRADE BALANCE 2020* Mexico 24.422

(Surplus)

Costa Rica 2.768 (Deficit)

In US Dollars. *Estimate by ECLAC * Note: latest available data (2020 - 2021).

72

Guatemala 6.637 (Deficit)

Honduras 2.138 (Deficit)

Nicaragua 1.521 (Deficit)

Panama 5.002 (Deficit)

El Salvador 5.563 (Deficit)

Mexico, Central America and the Caribbean

Mexico The Organization for Economic Co-operation and Development (OECD) lowered its growth forecast for the Mexican economy from 3.3% to 2.3% for 2022.

In its “OECD Economic Survey of Mexico”, the international organization also estimated that the gross domestic product will grow by only 5.3 % in 2021, after a previous estimate of 5.9 %.

On the other hand, the OECD anticipated a 2 % growth in private consumption in Mexico for this year, in addition to a 6.5 % increase in exports and 6 % in imports. At the same time, the organization estimated that the unemployment rate will stand at 4 %, which in comparison would not make much difference with the 4.1 % of 2021.

During January 2022, the National Institute of Statistics and Geography (Inegi) informed that the National Consumer Price Index (NCPI) presented a variation of 0.59 % with respect to the previous month.

In this way, annual general inflation in the first month MEXICO: GDP AND of the year reached 7.07 %, which represents a slight UNEMPLOYMENT, 2018-2020 decrease compared to December 2021, when it reached 7.36 %, this was reported on Wednesday. 6 4

MEXICO: GDP AND UNEMPLOYMENT, 2018-2020

E E I 6

4 2

5

0 -2

4

-4 -6

3

-8 -10

2

-12 -14

1

-16 -18 -20

T1

T2 T3 2018

T4

T1

T2 T3 2019

T4

T1

T2 2020

0

T3

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

S

ELECTRONIC SECURITY EQUIPMENT IMPORTS IMPLEMENTED IN PHYSICAL SECURITY

2 0 5 The Bank of Mexico (Banxico) warned that by 2022, -2 the Mexican economy will continue to face an uncer4 -4 tain environment, so it recommended that the coun-6 try -8 has an environment conducive to investment3and boost economic growth after the health crisis.

-10

2

-12 -14

1

-16 -18 -20

T1

T2 T3 2018

T4

T1

T2 T3 2019

T4

T1

T2 2020

T3

0

GDP, VARIATION RATE OVER 4 QUARTERS.

59.8 % CHINA

11.2 % MEXICO

20.5 % EEUU

8.5 % TAIWAN

INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

FROM JANUARY 2022 TO SEPTEMBER 30, 2022.

Source: Descartes Datamyne – Inegi.

LATIN AMERICA PHYSICAL SECURITY INDUSTRY MARKET STUDY 2023

73

Costa Rica

COSTA RICA: GDP AND UNEMPLOYMENT, 2018-2020

The Costa Rican economy has continued to grow at a faster-than-expected pace. Since the second quarter of 2021, economic activity surpassed the levels observed prior to the pandemic, and the strong rebound continued in the second half of the year. As a result, the Central Bank of Costa Rica (BCCR) revised upwards again the estimated growth for 2021, to 7.6%, from 5.4% in the projection presented last October.

The Central Bank projects a continued expansion, with a Gross Domestic Product (GDP) variation of 3.9% in 2022 and 4.0% in 2023. These rates reflect a gradual normalization of economic growth, but remain above the long-term trend.

5 4 3 2 1 0 -1 -2 -3 -4 -5 -6 -7 -8 -9 -10

T1

T2

T3 2018

T4

T1

T2

T3

T4

T1

2019

T2

T3

E E IN 24 22 20 18 16 14 12 10 8 4 4 2 0

2020

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS.

The unemployment rate moved visibly downward throughout 2021 to stand at 14.4 % in the moving quarter ending in November, but that rate is still 2.2 percentage points (p.p.) higher than observed before the pandemic.

Like economic activity, the fiscal accounts show COSTA GDP not AND much more RICA: favorable results, only compared to 2020, but also compared to the forecast. As of DeUNEMPLOYMENT, 2018-2020 cember 2021, the Central Government accumulated a5 primary deficit (excluding interest payments) 24 equi4 valent to 0.3 % of GDP (0.9 % projected in October), 22 3 2 20 considerably lower than that recorded in the same 1 18 period of the previous year (3.4 %), while the finan0 16 -1 cial deficit was 5.0 % of GDP (5.8 % projected in14Oc-2 12 tober and 8.0 % recorded a year earlier).

-3

Source: ECLAC, based on official data

S

ELECTRONIC SECURITY EQUIPMENT IMPORTS IMPLEMENTED IN PHYSICAL SECURITY

-4 10 -5 8 These results helped to contain indebtedness, but as -6 4 a-7 consequence of the still high financial deficit, the 4 -8 -9 Central Government debt to GDP increased in 22021 -10 0 by 1.1 p.p. withT4respect December T1 T2 T3 T1 T2 to T3 T4 T1 2020, T2 T3 to close

at 68.3 %.2018

2019

2020

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

74

53.2 % EEUU

10.9 % HONG KONG

27.3 % CHINA

8.6 % PANAMA

FROM JANUARY 2022 TO SEPTEMBER 30, 2022.

Source: Descartes Datamyne - National Customs Service.

El Salvador

EL SALVADOR: GDP AND INFLATION, 2018-2020

After a sharp contraction in 2020, the Monetary Fund projected that the economy would grow by approximately 10% of GDP in 2021, and 3.2% in 2022.

This has much to do with the rebound in external demand and El Salvador’s response to the pandemic. The country recorded one of the lowest rates of COVID-19 infections and deaths in the region, and has a relatively high vaccination rate.

Medium-term growth rates in El Salvador will slow to about 2% as stimulus policies in the United States are withdrawn.

On the other hand, the 64.8 % growth of gross fixed capital formation during the second quarter of 2021 was related to the continuity of investment in infrastructure of buildings, roads, improvement of hospitals and schools, among others; and by investment in machinery and equipment through the acquisition of communications equipment, mainly computers related to teleworking and online service provision; transportation equipment for services; equipment for electricity generation, among others.

EL SALVADOR: GDP AND Additionally, exports grew 113.5 % in the second INFLATION, 2018-2020

quarter of 2021, in response to the higher demand 3 and coming from Central American trading partners 4 the United States; while private consumption, which 2 2 0 constitutes the most important expenditure compo-2 nent within GDP, grew 39.2 % in the period thanks 1 -4 to the higher income that households are obtaining -6 -8 through family remittances and wages; the 0latter -10 show as of June 2021 a growth of 7.3 % among wor-1 -12 kers contributing to the Salvadoran Social Security -14 -2 -16 Institute (ISSS).

E E I 3

4 2

2

0 -2

1

-4 -6 -8

0

-10 -12 -14

-1 -2

-16 -18 -20

T1

T2 T3 2018

T4

T1

T2 T3 2019

T4

T1

T2 2020

T3

-3

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

S

ELECTRONIC SECURITY EQUIPMENT IMPORTS IMPLEMENTED IN PHYSICAL SECURITY

-18 -20

T1

T2 T3 2018

T4

T1

T2 T3 2019

T4

T1

T2 2020

T3

-3 48.0% EEUU

15.0% PANAMA

33.0% CHINA

4.0% COSTA RICA

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

F

FROM JANUARY 2020 TO DECEMBER 2021

Source: Descartes Datamyne - National Customs Service.

LATIN AMERICA PHYSICAL SECURITY INDUSTRY MARKET STUDY 2023

75

Panamá

PANAMA: GDP, INFLATION AND UNEMPLOYMENT, 2018-2020 3

The World Bank forecasts real GDP growth of 9.9% in 2021 and then a convergence to a potential growth rate of about 5%. The budget deficit will remain high in 2021, but will be below the deficit reduction path established in the revision of the Social and Fiscal Responsibility Law (7.5% of GDP by 2021).

On the other hand, Panama’s statistical institute reported that the performance of the economy in the third quarter of 2021, measured through the Quarterly Gross Domestic Product (GDPT), showed an increase of 25.5 %, with respect to the period of the previous year.

The GDP, valued at 2007 prices, registered an amount of $103.4 billion USD for the compiled quarter, which corresponds to an increase of $210.07 billion USD. They also indicated that the behavior observed in the different economic activities was a reflection of the economic reactivation since the elimination of the sanitary restrictions imposed by the health PANAMA: GDP, INFLATION authorities due to the COVID-19 pandemic.AND

UNEMPLOYMENT, 2018-2020 3

5 0

5 0

2

-5 1

-10 -15

0

-20 -1

-25 -30

-2

-35 -40

T1

T2

T3

2018

T4

T1

T2

T3

T4

2019

T1

T2

T3

-3

2020

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

S

ELECTRONIC SECURITY EQUIPMENT IMPORTS IMPLEMENTED IN PHYSICAL SECURITY

2

-5 1

-10 -15

0

-20 -1

-25 -30

-2

-35 -40

T1

T2

T3

2018

T4

T1

T2

T3

2019

T4

T1

T2

T3

-3

2020

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

76

E E IN

41.3% CHINA

16.0% BRASIL

31.3% EEUU

11.4% ZONA COLON

FROM JANUARY 2022 TO SEPTEMBER 30, 2022.

Source: Descartes Datamyne - National Customs Authority.

República Dominicana According to estimates by the Economic Commission for Latin America and the Caribbean (ECLAC), the Dominican economy would register 8.0% growth in 2021. “The recovery would be due in part to the successful vaccination campaign and the expected growth of the U.S. economy, the main source of income from family remittances and tourists.”

Increased economic activity would result in higher revenues, which, together with the gradual elimination of tax exemptions, would reduce the non-financial public sector fiscal deficit to 3.0% of GDP. The current account deficit is expected to narrow to the equivalent of 1.4% of GDP, close to its pre-pandemic level. Inflation would close the year at around 5%, close to the upper end of the target range.

DOMINICAN REP: GDP, INFLATION AND UNEMPLOYMENT, 2018-2020 10 8 6 4 2 0 -2 -4 -6 -8 -10 -12 -14 -16 -18 -20

8 7 6 5 4 3 2 1 T1

T2

T3

T4

2018

T1

T2

T3

T4

2019

T1

T2

T3

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

DOMINICAN REP: GDP, INFLATION AND UNEMPLOYMENT, 2018-2020

ELECTRONIC SECURITY EQUIPMENT IMPORTS IMPLEMENTED IN PHYSICAL SECURITY

8

0

2020

As of April 2021, total exports grew at a year-onyear rate of 22.9%. Imports also recorded a positive variation of 21.2%. Remittances maintained their dynamism, with an increase of 17.9% year-on-year compared to June 2020.

10 8 6 4 2 0 -2 -4 -6 -8 -10 -12 -14 -16 -18 -20

So

7 6 5 4 3 2 1 T1

T2

T3

2018

T4

T1

T2

T3

2019

T4

T1

T2

T3

0

2020 65.0% CHINA

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

EL EQ IN

5.0% COREA

30.0% EEUU FROM JANUARY 2020 TO DECEMBER 2021.

Source: International Trade Center (ITC).

LATIN AMERICA PHYSICAL SECURITY INDUSTRY MARKET STUDY 2023

77

Honduras

HONDURAS: GDP AND INFLATION 2018-2020

In the first quarter of 2021, total central government revenues registered a real year-on-year growth of 10.9%, in the face of an increase in tax revenues (13.5% real year-on-year). This was due, in part, to the collection of the December 2020 installment of income tax payments on account, which was postponed to January 2021.

5

6

4 2 2

5

-2

E E IN

4

-4 -6

3

-8 -10

2

-12 -14

Expenditure rose by 4.5% (0.5% real) year-on-year, due to higher spending on wages and salaries and an increase in current transfers. As of March 2021, the public sector external debt balance contracted by 0.6% (USD 58.5 million) compared to the December 2020 balance, due to a net amortization of USD 22.0 million and a favorable exchange rate variation.

In March, the Government acquired new debt of USD 220 million with the World Bank’s IDA and USD 44.7 million with the IDB. Exports of services reached USD 722 million, 38.7% below the value accumulated in 2019. In addition to the notable contraction in travel revenue (-65.8 %), there was a drop in the export of communications HONDURAS: AND services (-18.9 %) andGDP business services (-6.2 %).

INFLATION 2018-2020

5As of April 2021, exports had decreased by 13.1%, 6

1

-16 -18 -20

T1

T2

T3

2018

T4

T1

T2

T3

2019

T4

T1

T2

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

S

ELECTRONIC SECURITY EQUIPMENT IMPORTS IMPLEMENTED IN PHYSICAL SECURITY

watermelons and sugar, four crops that,

4 -4despite improved prices, negatively affected by tro-6

pical storms. Imports increased at a year-on-year 3 -10rate of 27.6% to April 2021. Consumer goods grew 2 -12by 29.5%, especially non-durable goods.

-8

-14 1

-16

-18Imports of capital goods totaled USD 553.4 million,

-20up 42.2 % from April 2019, as a result of increased 0 T1 T2 T3 T4 T1 T2 T3 T4 T1 T2 T3

purchases of transport vehicles and machinery for 2018 2019 2020 the textile and agricultural industry.

81.0 % CHINA

19.0 % EEUU

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

78

0

2020

4compared to the same period in 2020. This behavior 2 5 is associated with the drop in exports of bananas, 2

-2melons,

T3

FORM JANUARY 2022 TO SEPTEMBER 2022.

Source: Descartes Datamyne - National Customs Authority.

Guatemala

GUATEMALA: GDP AND INFLATION, 2018-2020

ECLAC estimates that Guatemala’s GDP will grow by 4.6% in 2021. The central government deficit will close the year at around 3.5% of GDP, as a result of a gradual recovery of revenues. The current account surplus is expected to be around 2.5% of GDP, mainly due to the recovery of imports as a result of the reactivation of consumption and investment.

Year-on-year inflation (December to December) would close at around 3.8%, within the central bank’s target range (4%, with a one percentage point tolerance in both directions), due to fewer restrictions on the supply of goods and services. The open unemployment rate is expected to decrease in 2021, to the extent that progress is made in vaccination and the dynamism of economic activity recovers.

For 2021, a fiscal policy with a strong execution of public spending is expected towards the second half of the year, so that, as of the first four months of the year, a surplus is recorded. Total public revenues experienced a real year-on-year growth of 12.3% as of April 2021.

GUATEMALA: GDP AND Tax revenues expanded by 13.3 % in real terms, whiINFLATION, 2018-2020

le non-tax revenues fell by 5.2 %, also in real terms.

As of the first four months of 2021, total expenditu6 res recorded a real annual decline of 3.4%. Capital 6 expenditures, on the other hand, showed an increa5 5 se of 0.4% in real terms.

4

6

6 5

5

4

4

3

3

2

2

1 0

1 T1

T2 T3 2018

T4

T1

T2 T3 2019

T4

T1

T2 2020

T3

0

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

Sou

ELECTRONIC SECURITY EQUIPMENT IMPORTS IMPLEMENTED IN PHYSICAL SECURITY

4

3

3

2

2

1 0

EL EQ IN

1 T1

T2 T3 2018

T4

T1

T2 T3 2019

T4

T1

T2 2020

T3

0 56.0% EEUU 19.0% CHINA

GDP, VARIATION RATE OVER 4 QUARTERS.

25.0% PANAMA

INFLATION, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

FROM JANUARY 2020 TO DECEMBER 2021.

Source: ITC.

LATIN AMERICA PHYSICAL SECURITY INDUSTRY MARKET STUDY 2023

79

EXPORTS AND TRADE BALANCE IN THE ANDEAN REGION AND THE SOUTHERN CONE 2020 - 2021 % EXPORT GROWTH 2020 - 2021

23,10% Venezuela

TRADE BALANCE 2020 - 2021

-4,60%

Bolivia 64.800 (Deficit)

Colombia

Colombia 12.481 (Deficit)

2,29%

Ecuador

Brazil 3,07%

3,02%

Peru

Ecuador 2.267 (Surplus) Peru 6.314 (Surplus) Venezuela 1. 530 (Deficit)

0,18%

Bolivia

Brazil 43.602 (Surplus) 5,02% Chile

Source: IADB and ECLAC

80

3,22%

Argentina

Argentina 12. 530 (Surplus) Chile 12.695 (Surplus) In US Dollars *Estimation by ECLAC

Andean Region

Bolivia

BOLIVIA: GDP, INFLATION AND UNEMPLOYMENT, 2018-2020

In the first months of 2021, the economy has shown important signs of recovery due to the improvement of the international environment and the relaxation of the isolation measures adopted at the beginning of the pandemic.

6

6

5

2 -2

4

-6

According to ECLAC, “high public indebtedness and modest international reserves could limit efforts to invigorate the economy through expansionary policies alone, especially if the private sector does not play a more active and sustained role.”

In 2021, Bolivia’s average inflation rate was projected to register one of its highest points, at over 3.8%.

Additionally, from 2024 onwards, the inflation rate is also expected to remain stable at 3.5% until 2026.

The 2022 General State Budget (PGE) establishes an economic growth of 5.1%, inflation of 3.4%, public investment of USD 5,015 million and a fiscal deficit of -8%.

Imports will approach USD 8 billion, with USD 7.424

BOLIVIA: INFLATION AND billion reportedGDP, for October 2022.

UNEMPLOYMENT, 2018-2020

3

-10

2 -14

1

-18 -20

T1

T2 T3 2018

T4

T1

T2

T3 2019

T4

T1

T3 T2 2020

0

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

S

ELECTRONIC SECURITY EQUIPMENT IMPORTS IMPLEMENTED IN PHYSICAL SECURITY

6

6

5

2 -2

4

-6

3

-10

2 -14

1

-18 -20

T1

T2 T3 2018

T4

T1

T2

T3 2019

T4

T1

T3 T2 2020

0 64.89 % CHINA

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

E E IN

20.02 % EEUU 15.09 % MEXICO FROM JANUARY 2020 TO DECEMBER 2021.

Source: International Trade Center (ITC) - Pro-Bolivia.

LATIN AMERICA PHYSICAL SECURITY INDUSTRY MARKET STUDY 2023

81

Colombia

COLOMBIA: GDP, INFLATION AND UNEMPLOYMENT, 2018-2020

The Colombian economy grew by 10.6% in 2021, after plummeting 7% in 2020 due to the ravages of the pandemic, according to official data from the National Administrative Department of Statistics (DANE).

Both figures are historic. Last year’s is the largest increase in gross domestic product (GDP) in the country, at least since the statistical authority has been keeping records, in 1975.

4

20

2

18

0

16

-2

14

-4

12

-6

10

-8

8

-10 -12

6

-14

4

In the region, Colombia’s growth is only below the current projections of the Organization for Economic Cooperation and Development (OECD) for Chile (12%), and is above Argentina (8%) or Mexico (5.9%). The OECD also updated its projections for Colombia, and expects it to grow 5.5% in 2022 and 3.1% in 2023.

-16

2

In terms of unemployment, the year 2021 closed with an unemployment rate of 13.7%, a reduction compared to 15.9% in 2020. The informality rate for 2021 reached 48.4%.

Source: ECLAC, based on official data

In turn, consumption, especially private consumpCOLOMBIA: GDP, tion, has been leading theINFLATION recovery: it will AND grow 12.2% in 2021 and 4.1% in 2022, with a gradual UNEMPLOYMENT, 2018-2020 rebalancing from spending on goods to services.

-18

T1

T2 T3 2018

T4

T1

T2 T3 2019

10 the By 2022, the moderation of domestic demand, -8 reactivation of services exports and higher oil8 pro-10 duction will help moderate the current account6 defi-12 4 -14 cit to 4.5% of GDP. 2

-18

T1

T2 T3 2018

T4

T1

T2 T3 2019

T4

T1

T2 2020

T3

0 66.00 % CHINA

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

82

T3

ELECTRONIC SECURITY EQUIPMENT IMPORTS IMPLEMENTED IN PHYSICAL SECURITY

12

-16

T2 2020

0

UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS.

0 be able to recover its pre-pandemic levels. In 16 2022, -2 14 investment will grow 4.5%.

-6

T1

INFLATION, VARIATION RATE OVER 12 MONTHS.

2 18 not Investment, despite growing 13.1% in 2021, will

-4

T4

GDP, VARIATION RATE OVER 4 QUARTERS.

20

4

E E IN

24.00 % EEUU 10.00% MEXICO FROM JANUARY 2022 TO SEPTEMBER 2022.

Source: Descartes Datamyne - DIAN.

S

Ecuador

ECUADOR: GDP, INFLATION AND UNEMPLOYMENT, 2018-2020

According to the latest report of the International Monetary Fund (IMF), “the latest growth expectations for the region at the end of 2021 rose to 6.3%, compared to July’s estimates (5.8%) mainly due to the reopening and progress in vaccination. Ecuador would have an economic growth of 2.8% by the end of 2021 and 3.5% by 2022”.

5

5

3

4

1

3

-1 -3

2

-5

1

-7 -9

Similarly, the inflation projection for 2022 is 2.1%, which evidences a potential recovery of prices. Similarly, the IMF estimates a 0.4 p.p. reduction in unemployment between 2021 (4.6 %) and 2022 (4.2 %). This scenario is explained by the increase in oil prices, the easing of restrictions and the boost in the export of raw materials.

0

-11

-1

-13 -15

E E IN

T1

T2

T3

T4

2018

T1

T2

T3

T4

T1

2019

T2

T3

-2

2020

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS.

On the other hand, foreign direct investment (FDI) reached USD 364 million between January and June 2021, i.e. 19.9 % (USD 91 million) lower than in the same period of 2020, according to the Central Bank of Ecuador. The sectors that received the highest FDI were: business services (USD 143 million); construction (USD 85 million); and manufacturing (USD ECUADOR: GDP, INFLATION AND 52 million).

UNEMPLOYMENT, 2018-2020

Despite the performance in this first semester, the 5 5 government mentioned its interest in increasing FDI, progress is shown in the willingness to invest 3 4 in in1 ternational companies, mainly from Peru, Colombia 3 -1 and Mexico. These companies highlight Ecuador’s -3 2 low inflation, current political stability, economic re-5 activation, commitment to fiscal adjustment and le1 -7 gal security.

-9

S

ELECTRONIC SECURITY EQUIPMENT IMPORTS IMPLEMENTED IN PHYSICAL SECURITY

0

-11

-1

-13 -15

Source: ECLAC, based on official data

T1

T2

T3

2018

T4

T1

T2

T3

T4

2019

T1

T2

T3

-2

2020

GDP, VARIATION RATE OVER 4 QUARTERS.

44.6 % EEUU

16.2 % COLOMBIA

34.3 % CHINA

4.9 % BRAZIL

INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

FROM JANUARY 2022 TO SEPTEMBER 2022.

Source: Descartes Datamyne – National Customs Service.

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83

Venezuela ECLAC estimates that the Venezuelan economy will grow by 1% in 2022, as a result of a greater availability of external assets that imply increases in both crude oil prices and exported volumes, due to the normalization of Venezuelan crude oil commercialization processes as a result of the greater growth of the main destinations of said product, and a possible relaxation of the sanctions imposed by the United States.

Data not available

Private consumption could recover as a result of a greater dynamism in remittances and the end of restrictions on mobility within the country. In this scenario, the Venezuelan economy would put an end to an episode of contraction that has lasted eight years and that, by the end of 2021, would bring Venezuelan GDP to represent just over 24% of what it was in 2013.

Venezuelan exports of goods and services fell by nearly 50 % in 2020, after falling by 33 % in 2019.

This further plunge in exports in 2020 reflects the considerable decline in the average price of the Venezuelan crude oil basket, which fell by 50 % compared to the average value in 2019 (USD 56.6 per barrel).

ELECTRONIC SECURITY EQUIPMENT IMPORTS IMPLEMENTED IN PHYSICAL SECURITY

Similarly, the reduction in the volume exported, estimated at 36 %, also contributed to the sharp decline in Venezuelan exports during 2020. Imports of Venezuelan goods and services decreased by more than 40% in 2020, reflecting the sharp contraction in aggregate demand, as well as the lower availability of foreign currency implied by the drop in exports and the sharp decline in remittances sent by Venezuelans working abroad during 2020.

75.0 % CHINA 15.0 % PANAMA 10.0 % EEUU FROM JANUARY 2022 TO SEPTEMBER 2022.

Source: Descartes Datamyne with information from partner countries.

84

Peru

PERU: GDP, INFLATION AND UNEMPLOYMENT, 2018-2020

For 2021, the Economic Commission for Latin America and the Caribbean (ECLAC) projected a growth of 10.6%. With the data available for 2021, it can be seen that in the first half of the year, domestic production accelerated and presented a growth of 20.9%, registering positive results in practically all sectors, although it is necessary to take into account the low base of comparison.

The reopening of all productive sectors and the recovery of aggregate demand, particularly domestic demand, contributed to this rebound.

In July, the fiscal account showed a primary deficit of 4.5% of GDP in the 12-month accumulated period, a progressive decline from a deficit of 7.3% at the end of the previous year. This was due to the gradual recovery of tax revenues at a higher rate than the increase in spending after the application of tax relief measures, higher taxes from the mining sector and the gradual recovery of activity.

The central bank also projected that in 2021 the

PERU: GDP, INFLATION AND public deficit will be halved and public debt will remain stable at 34.4% of GDP (compared to 34.8% in UNEMPLOYMENT, 2018-2020 2020).

E E IN 10

4 1 -2

8

-5 -8

6

-11 -14

4

-17 -20 -23

2

-26 -29 -32

T1

T2

T3

2018

T4

T1

T2

T3

T4

T1

2019

T2

T3

0

2020

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

S

ELECTRONIC SECURITY EQUIPMENT IMPORTS IMPLEMENTED IN PHYSICAL SECURITY

10

4

Revenues rebounded to 19.2% of GDP due to a re1 8 bound in activity and higher tax and royalty collec-2 -5 tions from the mining sector. Non-financial expendi-8 tures declined to 23.9% of GDP as a result of 6lower -11 current expenditures, which more than offset higher -14 4 -17 capital expenditures. The fiscal deficit narrowed to -20 4.9% of GDP. -23

2

-26 -29 -32

T1

T2

T3

2018

T4

T1

T2

T3

2019

T4

T1

T2

T3

0

2020

75.00 % CHINA

GDP, VARIATION RATE OVER 4 QUARTERS.

15.00 % JAPON

INFLATION, VARIATION RATE OVER 12 MONTHS.

10.00 % EEUU

UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

SECURITY FROM JANUARY 2022 TO SEPTEMBER 2022.

Source: Descartes Datamyne – National Customs Service.

LATIN AMERICA PHYSICAL SECURITY INDUSTRY MARKET STUDY 2023

85

Southern Cone

Argentina In the first half of 2021, the Argentine economy showed a recovery after the gradual lifting of the restrictions on circulation implemented since the end of the previous year. The Monthly Estimator of Economic Activity (EMAE), published by the National Institute of Statistics and Censuses (INDEC), grew by 9.7% year-on-year in the accumulated of the first six months of the year, placing 3.9% below the value of the same period of 2019, before the irruption of the pandemic.

ARGENTINA: GDP, INFLATION AND UNEMPLOYMENT, 2018-2020 6

55

4 2

50

Inflation in the first seven months of the year accelerated to 45.7 % year-on-year, in the context of the increase in international commodity prices, the unfreezing of a set of regulated prices and the economic recovery.

In the same period, the trade surplus in goods narrowed, as a result of an increase in imports (51 %) that was greater than that of exports (31 %). In any case, the high foreign exchange liquidation of the export sector and the crediting of special drawing rights (SDRs) issued by the International Monetary ARGENTINA: INFLATION Fund (IMF) resulted inGDP, international reserve s(a key variable UNEMPLOYMENT, in the context the external crisis afflicting AND the country)since the beginning of 2018 increasing 2018-2020 55 6 about USD 46.2 billion at the end of August 2021. to 4 2

45

0 -2

40 35

-4 -6 -8

30 25

-10 -12 -14

20 15 10 5

-16 -18 -20

T1

T2 T3 2018

T4

T1

T2 T3 2019

T4

T1

T2 2020

T2 T3 2018

T4

T1

T2 T3 2019

T4

T1

T2 2020

T3

UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

ELECTRONIC SECURITY EQUIPMENT IMPORTS IMPLEMENTED IN PHYSICAL SECURITY

0 54.48 % CHINA

GDP, VARIATION RATE OVER 4 QUARTERS.

15.39 % MEXICO

INFLATION, VARIATION RATE OVER 12 MONTHS.

13.15 % CANADA

UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

86

0

INFLATION, VARIATION RATE OVER 12 MONTHS.

In0 the first half of 2021, the central bank kept45 un40 -2 changed the annual nominal monetary policy inter35 -4 est rate (38 %), the minimum guaranteed rate for 30 -6 30-day time deposits of individuals up to 1 million -8 25 -10 pesos (37 %) and the minimum guaranteed rate 20 for -12 all other time deposits (34 %). During this period, 15 -14 10 the interest rate for personal loans also remained -16 5 stable at 52.7% nominal annual rate.

-18 T1

T3

GDP, VARIATION RATE OVER 4 QUARTERS.

50

-20

E E IN

FROM JANUARY 2022 TO SEPTEMBER 2022.

Source: Descartes Datamyne - National Customs Service.

S

Uruguay

URUGUAY: GDP, INFLATION AND UNEMPLOYMENT, 2018-2020

The markets for Uruguay’s main products have shown favorable signs, and the reactivation measures in the central countries have generated a context of high international liquidity. The Uruguayan economy is expected to grow by 4.1% in 2021, driven by a recovery in the level of activity in the manufacturing industry, gross fixed capital formation, and goods exports.

12

4 2 0

8

-2 -4 -6

4

-8

The IMF projected economic growth of 3.4% in 2021 and 3.2% in 2022. The reopening of borders and the resumption of tourism could support growth in 2022, although the outlook remains uncertain. Inflation is expected to close 2021 at around 7.2% and to remain on a downward trajectory, reaching 5.8% by the end of 2022.

-10

External demand also had a negative contribution to growth (-2.1 %) due to the sharp drop in exports (-16.2 % YoY) above the drop in imports (-10.8 % YoY). The services sector, led by tourism, was one of the hardest hit by the sanitary emergency and the continued border closure will continue to severely URUGUAY: INFLATION AND affect this branch GDP, of activity.

Source: ECLAC, based on official data

UNEMPLOYMENT, 2018-2020

Given the temporary closure of businesses and in12 dustries and the consequent reduction in income, 4 consumption in the country fell 6.9% in 2020, but a 2 recovery is expected for 2021, reaching 1.7%.

0

-12

T1

T2

T3

T4

2018

T1

T2

T3

T4

T1

2019

T2

T3

0

2020

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS.

S

ELECTRONIC SECURITY EQUIPMENT IMPORTS IMPLEMENTED IN PHYSICAL SECURITY

8

-2 Investment will maintain positive indicators in 2021, -4 a result of the progress of the third pulp mill proas ject in the country (UPM II) and the FFCC works.

This -6 4 would place investment at 11.7% versus 8% in 2020.

-8 -10 -12

T1

T2

T3 2018

T4

T1

T2

T3 2019

T4

T1

T2

T3

0

2020

40.70% BRAZIL

9.30%

ITALY

GDP, VARIATION RATE OVER 4 QUARTERS.

21.70% EEUU

8.90%

ARGENTINA

INFLATION, VARIATION RATE OVER 12 MONTHS.

12.10% CHINA

7.30%

ISRAEL

UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

E E IN

FROM JANUARY 2022 TO JULY 2022

Source: Descartes Datamyne - National Customs Service.

LATIN AMERICA PHYSICAL SECURITY INDUSTRY MARKET STUDY 2023

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Chile

CHILE: GDP, INFLATION AND UNEMPLOYMENT, 2018-2020

For 2022 and 2023, the growth ranges are corrected downwards, given the higher base of comparison, the gradual decline in the impulse to consumption and a limited dynamism of investment.

7 5 3 1 -1 -3

In the central scenario, GDP will grow between 2 and 3 % in 2022, and between 1.75 and 2.75 % in 2023.

The annual increase in private consumption will moderate significantly over the next two years, largely reflecting the temporary nature of the current income support measures.

-5 -7 -9 -11 -13 -15

T1

T2

T3

T4

2018

In investment, significantly lower rates of expansion are expected for 2022-2023 than in 2021. This is mainly due to the low dynamism of construction and works, the slow incorporation of new projects to the cadastres, the maintenance of uncertainty at high levels, the higher indebtedness of companies and the evolution of local financial conditions.

Underlying inflation will close the year slightly below 4 % annually. Rising energy prices will continue to dominate the volatile component. Thus, after reCHILE: GDP, AND aching higher valuesINFLATION in the second half of the year, total annual CPI inflation will be 4.4% in December UNEMPLOYMENT, 2018-2020 2021.

7 14

T1

T2

T3

T4

T1

2019

T2 2020

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

So

ELECTRONIC SECURITY EQUIPMENT IMPORTS IMPLEMENTED IN PHYSICAL SECURITY

13 12 In 3 2022 and 2023, as the fiscal and monetary impul11 se to 1 normalizes, inflation will converge towards 3%, 10 9 -1 remain at that value by the end of the policy horizon, 8 -3 the second quarter of 2023. in 7 -5 6 -7 5 4 -9 3 -11 2 -13 1 -15 0 5

T1

T2

T3

2018

T4

T1

T2

T3

2019

T4

T1

T2

T3

2020

GDP, VARIATION RATE OVER 4 QUARTERS. INFLATION, VARIATION RATE OVER 12 MONTHS. UNEMPLOYMENT, VARIATION RATE OVER 12 MONTHS. Source: ECLAC, based on official data

88

T3

14 13 12 11 10 9 8 7 6 5 4 3 2 1 0

E E IN

57.80 % CHINA

8.00 % ITALY

18.20 % EEUU

5.00 % SPAIN

11.00 % GERMANY FROM JANUARY 2022 TO SEPTEMBER 2022.

Source: Descartes Datamyne - National Customs Service.

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Reference index Cited sources: National Association of Industrialists (ANDI), “COLOMBIA: BALANCE 2020 AND PERSPECTIVES 2021,” 2021.

Bank of the Republic of Colombia, “Monetary Policy Report,” February 11, 2022.

Central Reserve Bank of El Salvador, “Salvadoran economy grew 24.5% in the second quarter of 2021,” October 1, 2021.

Inter-American Development Bank, “Broadband policies for Latin America and the Caribbean”.

World Bank, “Panama: overview,” October 6, 2021.

World Bank, “Bolivia: overview,” October 11, 2021.

Geneva Center for the Governance of the Security Sector, “Private Security in El Salvador,” 2021.

Economic Commission for Latin America and the Caribbean (ECLAC), “The paradox of recovery in Latin America and the Caribbean. Growth with persistent structural problems: inequality, poverty, little investment and low productivity,” July 2021.

Economic Commission for Latin America and the Caribbean (ECLAC), “Preliminary Overview of the Economies of Latin America and the Caribbean,” 2021 (LC/PUB.2022/1-P), Santiago, 2022.

Economic Commission for Latin America and the Caribbean (ECLAC), “The paradox of recovery in Latin America and the Caribbean Growth with persistent structural problems: inequality, poverty, little investment and low productivity,” July 8, 2021.

Economic Commission for Latin America and the Caribbean (ECLAC), “Economic Study of Latin America and the Caribbean,” Santiago, 2021.

Economic Commission for Latin America and the Caribbean (ECLAC), “Macroeconomic Report- Honduras,”2021.

Economic Commission for Latin America and the Caribbean (ECLAC), “Macroeconomic Report-Peru,” 2021.

Economic Commission for Latin America and the Caribbean (ECLAC), “Macroeconomic Report-Venezuela,”2021.

Economic Commission for Latin America and the Caribbean (ECLAC), “Macroeconomic Report-Brazil,”2021.

Economic Commission for Latin America and the Caribbean (ECLAC), “Uruguay Macroeconomic Report,”2021.

Economic Commission for Latin America and the Caribbean (ECLAC), “International Trade Outlook for Latin America and the Caribbean,” 2021.

90

Diario de los Andes, “More than 11 thousand violent deaths registered by the OVV during 2021,” December 2021.

El País, “Colombia’s GDP grew 10.6% in 2021, the highest annual rise since there are records,” February 15, 2022.

Infobae, “OECD reduced its GDP growth forecast for Mexico to 2.3% for 2022,” February 21, 2022.

Fenalco Antioquia, “Private security sector grew 8% in 2020,” September 15.

International Monetary Fund (IMF), “World Economic Outlook Update, July 2022: Bleak and More Uncertain,” July 2022.

International Monetary Fund (IMF), “El Salvador’s Recovery Constrained by Rising Risks,” February 16, 2022.

GECSA, “SURVEILLANCE AND PRIVATE SECURITY SECTOR,” January 2020.

HumVenezuela, “OVV: Annual Report on Violence 2021,” December 2021.

National Institute of Statistics and Informatics (INEI), “In June of this year, national production grew 3.44%,” August 15, 2022.

La República, “The private security sector contributes 1.2% of the national Gross Domestic Product,” August 24, 2022.

Mundo Gremial, “Private Security: business and union dispersion affect an industry that could have much more registered work,” April 19, 2022.

World Trade Organization (WTO), “Global trade recovery exceeds expectations, albeit with regional divergences,” 4 October 2021.

World Trade Organization (WTO), “Trade can help put the UN Sustainable Development Goals on track: Director-General Okonjo-Iweala,” 6 July 2021.

Portfolio, “International trade will grow 10.8% this year, according to the WTO,” October 4, 2021.

Presidency of Costa Rica, “BCCR ESTIMATES ECONOMIC GROWTH FOR 2021 AT 7.6% AND PROJECTS 3.9% FOR 2022 AND 4.0% FOR 2023”.

University Presence, “Crime and violence in Honduran companies limit the economic growth of the country,” October 2021.

Digital Process, “Crime and insecurity drive an unequal Honduras, highlights Cohep report,” June 2021.

SeguriLatam, “Amesp promotes the regularization and professionalization of private security in Mexico,” March 30, 2022.

Semana Magazine, “IMF reduced growth outlook for the world economy for 2022,”January 25, 2022.

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Databases: International Trade Center (ITC). With information from UN Comtrade (United Nations Organizations Trade Statistics Database) and official sources: • El Salvador: Central Reserve Bank.

• Guatemala: Central Bank of Guatemala.

• Paraguay: General Directorate of Customs.

• Dominican Republic: UN Comtrade.

Descartes Datamyne. With information from official sources and partner countries: • Argentina: General Directorate of Customs.

• Brazil: Latin American Integration Association (Aladi).

• Chile: National Customs Service.

• Colombia: Directorate of National Taxes and Customs (Dian).

• Costa Rica: National Customs Service.

• Ecuador: National Customs Service.

• Honduras: General Directorate of Control of Customs Franchises.

• Mexico: National Institute of Statistics and Geography of Mexico (Inegi).

• Panama: National Customs Authority.

• Peru: National Superintendence of Customs and Tax Administration (Sunat).

• Uruguay: General Directorate of Customs.

Harmonized Tariff Classification (HS-code) codes analyzed* for physical security: * Electronic security equipment used in physical security was taken into account: HS-Code** 85

8521 8525

8525.80 8531 8531.10

Description Electrical machines and equipment and their parts; sound recorders and players; television image and sound recorders and reproducers; parts and accessories of said articles.

Video recording or reproduction devices.

Radio broadcasting or television transmission apparatus, whether or not it incorporates reception or sound recording or reproduction apparatus; Television cameras, digital cameras and camcorders.

Television cameras, digital cameras and camcorders.

Signaling apparatus; Electrical or visual sound (for example, bells, sirens, indicator panels, burglar or fire alarms), excluding those of items no. 8512 or 8530.

Signaling apparatus; Electric, sound or visual alarms, anti-theft or fire alarms and the like, other than those of heading no. 8512 or 8530.

Harmonized tariff classification codes (HS-code) analyzed* for physical security: * Electronic security equipment used in physical security was taken into account.

Data collection dates: August 18 to October 31, 2022.

Data collection technique: Online survey on the Encuestados.com platform, company directory and Web sites.

Method: multiple choice and open questions.

Topics to which it refers: Selection of one or more of the brands of equipment most used in physical security.

Target group: Companies from the Top 10 Latin American Physical Security Companies 2022.

Survey developed by Latin Press, Inc.

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