The Inter-American Development Bank (IDB) says the value of goods exports from Latin America and the Caribbean (LAC) increased at an estimated rate of 18.8 percent last year.
It said the downward trend in the region’s external sales consolidated during this period, after growing 27.8 percent in 2021, according to an IDB report prepared by the IDB’s Integration and Trade Sector and its Institute for the Integration of Latin America and the Caribbean (INTAL).
Exports from the Caribbean rose by an estimated 38 percent in 2022 after growing by 44.4 percent in 2021. The United States accounted for most of the increase, followed by the European Union.
Latin America and the Caribbean’s total imports increased at an estimated rate of 26.3 percent in 2022, after growing by 37.4 percent in 2021.
The Washington-based financial institution said the region’s export performance was mainly explained by higher prices, while volumes lost momentum.
“In the coming months, the export growth rate is expected to slow in response to the downward trend in commodity prices, the war in Ukraine, restrictive monetary policies to reduce inflation and the slowdown in global growth, the latest edition of Trade Trends Estimates: Latin America and the Caribbean has found.
“After a rapid recovery in 2021, a series of global shocks have sent exports from Latin America and the Caribbean into a slowdown that will continue into 2023. Reversing this trend will be key to shoring up economic growth in the region,” said Paolo Giordano, Principal Economist at the IDB’s Integration and Trade Sector, who coordinated the publication.
The region’s external sales were driven by shipments to the United States, which are estimated to have grown by 21.3 percent in 2022. Demand from the rest of Latin America and the Caribbean’s major trading partners slowed dramatically compared to 2021. Sales grew by two percent to China, 14 percent to the European Union, and 25.6 per cent to Latin America and the Caribbean.
The report noted that in 2022, the prices of most commodities exported by Latin America and the Caribbean climbed.
Between January and November 2022, the year-on-year prices of oil (43 percent), coffee (29.1 percent), soybeans (13 percent), and sugar (5.5 percent) all increased. In contrast, the prices of iron ore and copper fell by 28.9 percent and 4.9 percent year-on-year, respectively, the report noted.
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