The Inter American Development Bank (IDB) Tuesday said that the value of exports from Latin America and the Caribbean (LAC) grew by an estimated 4.1 per cent last year, recovering from a 1.6 per cent decline in 2023.
According to the latest IDB’s Trade Trends Estimates for Latin America and the Caribbean, drawing on data for 2024, the report attributes the region’s export growth to higher shipment volumes, as prices stagnated.
The IDB said exports from the Caribbean rallied significantly, growing by 18.3 per cent in 2024 after a 14.9 per cent drop in 2023.
But while the trade outlook for Latin America and the Caribbean has improved significantly over the past year, with the region’s exports exiting a contractionary phase, the report cautions that there are still no signs of sustained growth.
“The risks to regional trade remain balanced, but projections point to only modest growth given the prevailing uncertainty in the global economy,” said Paolo Giordano, principal economist at the IDB’s Productivity, Trade, and Innovation Sector, who coordinated the report.
“To ensure foreign trade continues to make a meaningful contribution to economic growth, the region needs to prioritise reforms and investments that boost productivity, facilitate trade, and attract investment,” he added.
Export performance varied significantly across the subregions of Latin America and the Caribbean.
The IDB said that this year’s trade growth was spearheaded by South America, where export volumes surged. The Caribbean’s performance also rallied, while in contrast, exports from Central America remained stagnant.
The prices of Latin America and the Caribbean’s main export commodities declined steadily in 2024, with the exception of coffee and copper.
Coffee prices surged by 57.7 per cent year-on-year, while those of copper grew by 9.4 per cent. In contrast, there were significant year-on-year drops for soybeans (-22.1 per cent), sugar (-13.7 per cent), iron (-9.2 per cent), and oil (-2.7 per cent).
The IDB said it expects this downward trend to continue into the coming quarters, as global markets remain highly volatile.
South America’s exports grew by an estimated four per cent last year, after falling by 4.4 per cent in 2023. The driving force behind this increase was export volumes, which surged from 3.6 per cent growth in 2023 to 6.9 per cent in 2024, amid ongoing price declines.
The region’s total imports also rebounded, showing modest growth (3.2 per cent) after a sharp decline in 2023 (-6.8 per cent), the IDB added.
The estimates of exports from Latin America and the Caribbean for 2024 were calculated using data available through January 6, 2025.
In Trinidad and Tobago, exports fell by an estimated 13.1 per cent in 2024, less than the 37.8 per cent contraction of 2023.
Guyana’s exports soared by 59.6 per cent in 2024, building on the 15.8 per cent growth of 2023. Shipments increased to all major destinations except Asia (excl China), although the European Union and the rest of LAC contributed most to the rise.
This pronounced growth was driven entirely by a surge in oil production, according to the IDB report.
Jamaica’s exports contracted by an estimated 9.3 per cent in 2024, reversing the 4.9 per cent growth recorded in 2023, primarily driven by the decline in fuel sales.
The data used was for the following periods: January-December for Brazil; January-November for Argentina, Bolivia, Chile, Colombia, Costa Rica, El Salvador, Mexico, Nicaragua, Panama, Paraguay, Peru, Dominican Republic and Uruguay; January-October for Ecuador, Guatemala and Honduras; January-September for Bahamas, Barbados, Belize, Guyana and Suriname.
T&T and Jamaica reported data for the period of January to June 2024. (CMC)
