Latin America’s economy is set to grow by 2.2 percent this year, slightly below the 2.3 percent forecast in December due to a more complex global outlook, the Economic Commission for Latin America and the Caribbean (ECLAC, CEPAL in Spanish) said on Monday.
Argentina’s economy is projected to expand by 3.3 percent, according to the Santiago-based UN body.
Geopolitical tensions, not least the ongoing conflict in the Middle East, have hit Latin American economies through tighter financial conditions and a renewed build-up of inflationary pressures, ECLAC said in a statement.
In the first four months of the year, the escalation of the conflict has driven up global uncertainty and increased volatility across financial and commodity markets, said the body in a report.
A key influence has been the surge in oil prices, which in the first three weeks of April stood 74 percent above the average level recorded in December 2025. The spike has pushed up production and transport costs across the region.
Against this backdrop of higher inflation and weaker growth, major central banks have adopted a more cautious stance, maintaining less favourable financial conditions than had been expected at the end of last year, the UN commission said.
The slowdown will affect most regional economies. Mexico is a notable exception, with growth projected at 1.5 percent, up from 0.8 percent in 2025, alongside the Dominican Republic, which is expected to expand by four percent, compared with 2.1 percent last year.
Mexico is set to benefit from a recovery in consumption and investment, both of which fell sharply in 2025, as well as stronger exports linked to the likely ratification of the United States-Mexico-Canada Agreement (USMCA), said ECLAC executive secretary José Manuel Salazar-Xirinachs. The country is also expected to see a boost from tourism as one of the hosts of the 2026 World Cup.
Elsewhere, the Brazilian economy is forecast to grow by two percent in 2026, down from 2.3 percent the previous year. Colombia’s GDP is projected to expand 2.5 percent, Chile by two percent, Peru by 3.2 percent and Uruguay by 1.6 percent.
If the 2026 projection holds, Latin America will have recorded four consecutive years of growth at around 2.3 percent, underscoring a pattern of limited expansion capacity, the UN technical body warned.
– TIMES/AFP
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